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OBERWEIS DAIRY v. ASSOCIATED MILK PRODUCERS

United States District Court, Northern District of Illinois, E.D


December 30, 1982

OBERWEIS DAIRY, INC., PLAINTIFF,
v.
ASSOCIATED MILK PRODUCERS, INC., ET AL., DEFENDANTS.

The opinion of the court was delivered by: Shadur, District Judge.

  MEMORANDUM OPINION AND ORDER

Oberweis Dairy, Inc. ("Oberweis") has sued Associated Milk Producers, Inc. ("AMPI") and Central Milk Producers Cooperative ("CMPC")*fn1 alleging violations of the Sherman Act, 15 U.S.C. § 1 and 2. Oberweis has moved for summary judgment on the issue of liability, contending AMPI and CMPC are collaterally estopped from litigating that issue as a result of the holding in Alexander v. National Farmers Organization, 687 F.2d 1173 (8th Cir. 1982). In turn AMPI and CMPC have moved for "partial summary judgment" on certain Oberweis claims. For the reasons stated in this memorandum opinion and order:

1. This Court finds (a) certain facts and issues have been determined with preclusive effect in Alexander and (b) AMPI and CMPC are collaterally estopped from relitigating those facts and issues in this action.

2. This Court denies the AMPI-CMPC motion.

Background

Oberweis is a dairy engaged in the business of buying raw milk and marketing Grade A milk in the greater Chicago area.*fn2 AMPI is a large dairy cooperative. CMPC is a federation of cooperatives, including AMPI. Dairy cooperatives operate to increase the market power of member dairy farmers by various means.*fn3

Alexander was a private antitrust action begun in 1971 when a large dairy cooperative, Mid-America Dairymen, Inc. ("Mid-Am") sued National Farmers Organization ("NFO"), a rival organization of dairy and other farmers. NFO counterclaimed against Mid-Am, AMPI, CMPC and others, and AMPI counterclaimed against NFO. At the District Court level all substantive antitrust claims of the parties were rejected. In re Midwest Milk Monopolization Litigation, 510 F. Supp. 381 (W.D.Mo. 1981) ("Midwest Milk").

On appeal the conclusion NFO had not violated the antitrust laws was affirmed on other grounds. But the Court of Appeals for the Eighth Circuit found "Mid-Am, AMPI and CMPC did conspire to monopolize milk and eliminate competition through the use of predatory, anticompetitive and unlawful tactics." Alexander, 687 F.2d at 1179.*fn4 Oberweis invokes Alexander in its effort to preclude AMPI and CMPC from litigating their liability in this action.

By way of counterattack, AMPI and CMPC contend they are entitled to "partial summary judgment" on Oberweis' claims for damages arising from:

    1. purchases of raw milk from suppliers not
  controlled by AMPI or CMPC;

    2. handling, hauling and premium charges for
  certain raw milk in purchases from AMPI-CMPC; and

3. alleged AMPI-CMPC acts with co-conspirators.

AMPI and CMPC contend the first type of claim is barred under the "indirect purchaser" doctrine of Illinois Brick Co. v. Illinois, 431 U.S. 720, 97 S.Ct. 2061, 52 L.Ed.2d 707 (1977). As for the other two types, they contend Oberweis (a) has not produced in the discovery process, (b) is now precluded from producing or (c) admittedly does not have any factual evidence supporting those claims.

Oberweis' Motion

Oberweis has miscast its current motion as one seeking summary judgment on AMPI-CMPC liability. As Oberweis' own Mem. 5-8 indicates, it rather wants a ruling that (1) certain specific facts and issues have been determined in Alexander and (2) AMPI and CMPC are precluded from relitigating those issues here. Summary judgment "on the issue of liability alone" is appropriate under Fed.R.Civ.P. ("Rule") 56(c) only when a party has moved under Rule 56(a) or 56(b) and has established there is no genuine issue of fact material to liability, but the court does find a genuine issue as to the amount of damages. Though the Rules provide no specific procedural vehicle for the relief Oberweis seeks, Rule 16 comes closest to doing so. See Wetherill v. University of Chicago, 548 F. Supp. 66, 67 & n. 3 (N.D.Ill. 1982).

Even apart from that procedural problem, Alexander could not conceptually have determined AMPI-CMPC's liability to Oberweis. "[B]efore the private plaintiff in an antitrust action can recover damages, he must establish not only that the defendant has violated the antitrust laws, but also that the violation proximately caused injury to his business or property." 15 J. Von Kalinowski, Antitrust Laws and Trade Regulation § 111.01, at 111-1 (1981) ("Von Kalinowski"). Alexander did decide AMPI and CMPC conspired in violation of the antitrust laws, but their liability in that action necessarily depended on the Court's also finding "that NFO was a specific target of the conspiracy." 687 F.2d at 1191.

There was of course no corresponding finding in Alexander that the AMPI-CMPC conspiracy "proximately caused injury to" or targeted Oberweis' business. Oberweis cannot therefore be put in a position where "only the issue as to the amount of damages" remains in this action. Oberweis Motion at 1. That issue can be reached only after Oberweis satisfies its burden as to causation. 15 Von Kalinowski § 111.01, at 111-1 to 111-2. Any collateral estoppel effect of Alexander cannot and does not eliminate that burden.

Oberweis' mischaracterization of its motion has misdirected the argument between the parties. Essentially three questions are really presented:

    1. What relevant facts and issues did
  Alexander determine, with possibly preclusive
  effect?

    2. Can Oberweis satisfy the general
  requirements for invocation of offensive
  collateral estoppel?

    3. Are there specific reasons why collateral
  estoppel should not be applied against AMPI and
  CMPC in this action?

Those questions are addressed in turn.

1. Alexander's Relevant Holdings

Alexander found specifically (all these are direct quotes from the Court of Appeals' opinion):

    (a) In any commercially meaningful sense, Grade
  A milk is . . . a relevant product market for
  antitrust purposes. . . . 687 F.2d at 1191.

    (b) [T]he record reveals public
  assertions . . . by CMPC that it represents over
  ninety percent of the producers selling into the
  Chicago market, and supplies over ninety percent
  of that market's fluid milk use. Id. at 1192.

    (c) [T]he defendants do not seriously dispute,
  nor could they on this record, that they acted in
  concert with the intent to eliminate competition
  and gain sufficient control of milk to enable
  them to set higher prices. Id. at 1193.

    (d) AMPI, Mid-Am and CMPC did conspire to
  monopolize and eliminate competition in the
  marketing of Grade A milk produced in the
  Midwest, through the use of discriminatory
  pricing, coercive supply disruptions and threats
  of similar conduct, as well as bad faith
  harassment and threats of litigation against
  independent buyers of NFO milk. Id.

    (e) This conspiracy violates Sections 1 and 2
  of the Sherman Act, notwithstanding the
  Capper-Volstead exemption [of cooperatives from
  certain antitrust law liability], because it
  involved the concerted use of predatory and other
  unlawful, anti-competitive means to eliminate
  competition and pursue monopoly power.
  Id. at 1191.

Then the Court of Appeals surveyed the defendants' overt acts, id. at 1194-1207, including some in the Chicago marketing region, id. at 1196-99. All the activity cited in that survey fell in the 1969-71 period, and there is nothing to indicate a holding of illegality either before or after those years.
*fn5 As AMPI points out (Ans. Mem. 13 n. 5) the Chicago-area overt acts described in Alexander occurred only in 1970-71.

In this action Oberweis claims damages allegedly arising from AMPI and CMPC conduct beginning in 1957 and continuing to date, Complaint ¶ 21, insofar as those fall within the statute of limitations, id. ¶ 26. But Oberweis has not responded to AMPI's point on the time frame of Alexander's holding. Because Alexander's findings relevant here are focused on the 1970-71 period, any collateral estoppel effect must be so limited.*fn6

2. General Collateral Estoppel Principles

In Montana v. United States, 440 U.S. 147, 153, 99 S.Ct. 970, 973, 59 L.Ed.2d 210 (1979) the Supreme Court described the doctrine of collateral estoppel:

  Under collateral estoppel, once an issue is
  actually and necessarily determined by a court of
  competent jurisdiction, that determination is
  conclusive in subsequent suits based on a
  different cause of action involving a party to
  the prior litigation.

Collateral estoppel is integral to civil practice because it permits conservation of adversarial and judicial resources and minimizes the possibility of inconsistent judicial decisions. Id. at 153-54, 99 S.Ct. at 973-74.

"Offensive" collateral estoppel, approved for the federal courts in Parklane Hosiery Co. v. Shore, 439 U.S. 322, 99 S.Ct. 645, 58 L.Ed.2d 552 (1979), permits a plaintiff to foreclose a defendant's relitigating an issue previously lost by that defendant in an action with another party. Even though that usage had been criticized by some courts and commentators, the Court held (id. at 331, 99 S.Ct. at 651-52, footnote omitted):

  We have concluded that the preferable approach
  for dealing with these problems in the federal
  courts is not to preclude the use of offensive
  collateral estoppel, but to grant trial courts
  broad discretion to determine when it should be
  applied. The general rule should be that in cases
  where a plaintiff could easily have joined in the
  earlier action or where, either for the reasons
  discussed above or for other reasons, the
  application of offensive estoppel would be unfair
  to a defendant, a trial judge should not allow
  the use of offensive collateral estoppel.

Determination of fairness requires the defendant to have had a "full and fair" opportunity to litigate the claims in the earlier action. Id. at 332, 99 S.Ct. at 652.*fn7

Just last year the operative principles were restated in the context of a summary judgment motion in a private antitrust action, GAF Corp. v. Eastman Kodak Co., 519 F. Supp. 1203, 1211-12 (S.D.N.Y. 1981) (citations omitted):*fn8

  Briefly stated, the following are preconditions
  to the application of collateral estoppel: (1)
  the party against whom collateral estoppel is
  asserted must have been a party, or in privity
  with a party, to the prior action; (2) there must
  have been a final determination of the merits of
  the issues sought to be collaterally estopped;
  (3) the issues sought to be precluded must have
  been necessary, material, and essential to the
  prior outcome; (4) the issues sought to be
  precluded must have been actually litigated in
  the prior action, with the party against whom the
  estoppel is asserted having had a full and fair
  opportunity to litigate the issues; and (5) the
  issues actually and necessarily decided in the
  prior litigation must be identical to the issues
  sought to be estopped. . . . In addition, in
  exercising its discretion, the trial court may
  only invoke offensive collateral estoppel when
  the plaintiff could not have easily joined in the
  prior action and when application of the doctrine
  would not be unfair to the defendant.

AMPI and CMPC would have done well to focus on those "preconditions" to Oberweis' use of collateral estoppel here.*fn9 Unfortunately, due in part to Oberweis' mischaracterization of its motion, AMPI and CMPC did not follow GAF's logical and clear legal outline.

3. pplication of Collateral Estoppel in This Action

Beyond doubt the principal GAF "preconditions" to offensive collateral estoppel have been met. AMPI and CMPC were defendants in Alexander and litigated that action fully over a decade. They had every reason to contest every issue in Alexander vigorously and under the same procedural conditions prevailing here. See Pinto Trucking Service, Inc. v. Motor Dispatch, Inc., 649 F.2d 530, 533 n. 4 (7th Cir. 1981). As a general matter, then, there is no element of potential unfairness to AMPI and CMPC. It remains to consider the specific objections raised by AMPI and CMPC.

AMPI and CMPC pose the legal question whether offensive collateral estoppel is available between private antitrust actions. Otherwise most of their objections go in one way or another to the finality of Alexander, to the identity of the issues involved in that and this action, and to certain allegedly questionable legal tests applied in Alexander. But throughout their discussion AMPI and CMPC have argued to avoid final liability to Oberweis.*fn10 Having swallowed whole Oberweis' characterization, AMPI and CMPC wasted much of their effort instead of concentrating (as they should have) on why collateral estoppel as to specific issues and facts might be inappropriate here.*fn11

a. Collateral Estoppel in Private Antitrust Actions

AMPI (Ans. Mem. 3-5) and CMPC (Ans. Mem. 2-4) argue collateral estoppel is not available between private antitrust actions. Their argument is based on tortured legislative history and logic.

Before its amendment in 1980 Clayton Act § 5(a) (15 U.S.C. § 16(a)) provided a final judgment against a defendant in a governmental civil or criminal antitrust action "shall be prima facie evidence against such defendant" in a private antitrust action. In 1980 Section 5(a) was amended by adding:

  Nothing contained in this section shall be
  construed to impose any limitation on the
  application of collateral estoppel, except that,
  in any action or proceeding brought under the
  antitrust laws, collateral estoppel effect shall
  not be given to any finding made by the Federal
  Trade Commission under the antitrust laws or
  under section 45 of this title which could give
  rise to a claim for relief under the antitrust
  laws.

That amendment was intended to override some court decisions that had interpreted the former "prima facie evidence" language to preclude (inferentially) full collateral estoppel effect to a prior government action in a private action. See H.R. Rep. No. 874, 96th Cong., 2d Sess. 2-6, reprinted in 1980 U.S.Code Cong. & Ad. News 2716, 2752, 2752-56; National Comm'n for the Review of Antitrust Laws and Procedures, Report to the President and the Attorney General, Antitrust & Trade Reg.Rep. (BNA) No. 897, at 29-31 (Jan. 18, 1979). Its entire focus was on the collateral estoppel effect to be given future government antitrust actions.

AMPI and CMPC somehow read into the amendment the notion that before 1980 there could be no collateral estoppel effect given to private antitrust actions in later private actions. They not only embrace the questionable restrictive reading of pre-amendment Section 5(a) but also infer the section had implicitly denied any collateral estoppel effect to private antitrust actions!

Instead the thrust of the 1980 amendment is precisely the opposite: Congress wanted to clarify the applicability of universal collateral estoppel principles to government antitrust actions, unfettered by a narrow reading of Section 5(a). This was the import of the National Commission's Report, id. at 30 (footnote omitted):

  [T]he majority of the Commission recommends that
  Congress amend the statute to make it clear that
  the prima facie effect afforded prior litigated
  judgments won by the government does not preclude
  courts, in their discretion, from applying in
  antitrust cases the principles of collateral
  estoppel now applicable in other types of
  litigation. A defendant who lost either a prior
  government or private suit could be precluded
  from relitigating against subsequent plaintiffs
  those issues fully and fairly contested and
  necessary to the result in the first action. In
  this way, the deterrent effect of the antitrust
  laws will be enhanced and complex antitrust cases
  can be litigated and adjudicated more
  efficiently.

AMPI and CMPC would distort the phrase "or private suit" to mean the Commission was recommending creating the possibility of collateral estoppel use of a private action. That is simply nonsense, for it is plain the Commission was rather seeking to make sure government actions were brought into parity with the existing status of private actions for collateral estoppel purposes.*fn12 See 15 Von Kalinowski § 109.04[5], at 109-29 to 109-32 and July 1982 Supp. § 109-04[5], at 5-7.

b. Finality of Alexander

AMPI implies (Ans. Mem. 2) and CMPC argues (Ans. Mem. 21-22) Alexander is not a final judgment on the merits. Of course Alexander's being subject to review en banc or by the Supreme Court does not affect its finality. See 1B Moore's Federal Practice § 0.416[3], at 2252-53 (1982).*fn13

c. Identity of the Issues

AMPI (Ans. Mem. 5-10) and CMPC (Ans. Mem. 11-14, 19-20, 23) contend the conspiracy in Alexander was not the same as the conspiracy alleged by Oberweis. That position makes sense only if translated into an argument Alexander could not establish AMPI-CMPC liability in this action. Otherwise the conspiratorial facts and issues determined in Alexander are identical to those here — though Oberweis is obligated to prove it too was a target of AMPI-CMPC antitrust violations found in Alexander. Even Oberweis came to see this dimly. R. Mem. 3-5, 8.

Nor is this conclusion altered by Oberweis' original opposition to consolidation of this case with Alexander for discovery purposes. AMPI Ans. Mem. 8-9; CMPC Ans. Mem. 24. Alexander was a suit between competitors, involving claims of antitrust violations throughout the Midwest. Oberweis was a buyer operating in a limited market, so the two actions did not fully occupy the identical universe. Pl.R.Mem. 9. Yet that does not foreclose Oberweis' use now of AMPI-CMPC antitrust violations over time periods and in the geographic area covered by the Complaint here. It is irrelevant that the geographic areas of the two actions differ (AMPI Ans.Mem. 2, 10-12 and CMPC Ans.Mem. 14-15). What controls is that Alexander included this action's relevant area.

d. Assertedly Differing Legal Standards

AMPI (Ans.Mem. 2, 15-22) and CMPC (Ans.Mem. 6-11, 20-21) argue vigorously about Alexander's supposed laxity in requiring a lesser showing of a relevant geographic market on NFO's conspiracy claims than on its actual and attempted monopolization claims against AMPI and CMPC. See 687 F.2d at 1181-82, 1192-93. True enough, the lesser showing was in part responsible for the Court of Appeals' reversing Midwest Milk on the conspiracy claims but affirming dismissal of the actual/attempted monopolization claims. That difference however related to NFO's effort to show a ten-state-wide conspiracy and monopolization — an effort found adequate as to the former but inadequate as to the latter. Id. at 1192-93.*fn14

What is significant for this case, though, is the Chicago market — and here there was no doubt about AMPI-CMPC antitrust violations under the strictest of standards. Id. at 1192, 1194, 1196-99, 1207. Thus even if Alexander were considered to have applied in some respects a legal rule different from one prevailing in this Circuit, Alexander's finding of antitrust violations in the Chicago market is available for collateral estoppel use in this action.

AMPI (Ans.Mem. 23-24) and CMPC (Ans.Mem. 18-19, 20) also object to Alexander's treatment of the Noerr-Pennington doctrine, under which joint efforts to influence public officials are not themselves illegal under the Sherman Act. See 687 F.2d 1195-96. AMPI and CMPC claim misuse of the doctrine led to the Alexander holding, precluding reliance on Alexander in this action and Circuit. That argument hardly merits discussion:

    1. Application or non-application of the
  doctrine to NFO is totally irrelevant to
  liability as between Oberweis and AMPI-CMPC.

    2. In any case even a cursory glance shows
  Alexander's use of Noerr-Penning-ton evidence was
  not crucial to its overall findings. See 687
  F.2d at 1196.

e. Unfairness to AMPI-CMPC

AMPI (Ans.Mem. 26-29) and CMPC (Ans. Mem. 22-26) assertions about the unfairness of applying collateral estoppel against them either (1) rehash the objections already discussed or (2) suggest no determination of their liability would be proper on Oberweis' motion. Neither set of arguments needs further discussion.

Still another "fairness" contention involves Oberweis' discovery shenanigans in this action. AMPI Ans.Mem. 6, 29; CMPC Ans.Mem. 24-26. But any Oberweis discovery sins argue for appropriate sanctions under Rule 37, not for a reward to AMPI-CMPC on this motion. Moreover, the very contention comes with ill grace from AMPI, whose own discovery actions in Alexander were condemned as "outrageous" and as justifying "the most severe sanctions upon AMPI — . . . default judgment against it." 687 F.2d at 1205.*fn15

4. Summary

This Court finds AMPI and CMPC collaterally estopped from relitigating the facts and issues referred to under "Alexander's Relevant Holdings": essentially whether Grade A milk is a relevant product market, whether AMPI and CMPC conspired to monopolize the market for Grade A milk and to eliminate competition in the Chicago Regional Market Area in the 1970-71 period, thus violating Sherman Act §§ 1 and 2, and whether they controlled over 90% of the Chicago market. Only those facts and issues, raised by Oberweis' multifarious claim for damages (Complaint ¶¶ 21-24, 26), have been determined adversely to AMPI and CMPC in Alexander. But those determinations ought to be and are given preclusive effect in this action.

AMPI-CMPC Motion

One easy answer to AMPI-CMPC's "partial summary judgment" motion is there is no such animal in their terms. Rule 56(d) is not designed for the use AMPI-CMPC intend: "the singling out of limited issues on which the Court's advice may be obtained." Mendenhall v. Barber-Greene Co., 531 F. Supp. 947, 948 (N.D.Ill. 1981). See also Malcak v. Cooney, 93 F.R.D. 830, 831 n. 1 (N.D.Ill. 1982).

Rule 56(d) does allow a court to determine some material facts "appear without substantial controversy," but only when a party has moved unsuccessfully for a "full" summary judgment under Rule 56(a) or 56(b). Here AMPI-CMPC do not move for full summary judgment, nor do they really seek summary judgment on a "part" of a claim in the sense meant in the same Rules. Oberweis' Complaint ¶¶ 21-23, 26) states one single-count claim for damages, the "parts" of which are aspects of that whole claim rather than discrete "sub-claims." Essentially AMPI-CMPC want a ruling that certain Oberweis damages cannot be assessed or have not been proved. "Partial summary judgment" is their invented mechanism to gain that end.*fn16

1. Claimed Failures To Prove Damages

Their focus on damages issues is most evident in the part of their motion dealing with (1) handling, freight and premium charges on Oberweis' purchases from AMPI-CMPC*fn17 and (2) alleged illegal acts of AMPI-CMPC and unnamed co-conspirators. Their whole argument in that area (Mem. 29-32, 32-34, 35-37; R.Mem. 18ff.) is that certain damages have not been shown in the discovery process.*fn18

Even were Rule 56 susceptible to such use, Oberweis would be entitled to all favorable inferences from the facts of record, United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176 (1962). In that light even the claimed absence of specific facts on specific parts of Oberweis' damages claim would not mean AMPI-CMPC are now entitled to "partial" judgment as a matter of law. Because favorable inferences would be available to Oberweis from its more general factual showings (see Ans.Mem. 12-18, describing its discovery evidence), a ruling against Oberweis on a Rule 56 motion would be extremely unlikely. This suggests another reason why Rule 56 is really not fit for AMPI-CMPC's intended use.

2. Illinois Brick Issue

AMPI-CMPC make a different contention on a third set of claims, arising from Oberweis' purchases from 23 suppliers allegedly not controlled by AMPI-CMPC. Those claims, involving both raw milk prices and handling/service charges, are assertedly barred by the indirect purchaser doctrine of Illinois Brick. Mem. 19-27, 29; R.Mem. 10-18. Entirely aside from any Rule 56 considerations, AMPI-CMPC's appeal to Illinois Brick is misguided.

Clayton Act § 4 (15 U.S.C. § 15) provides a treble-damage remedy to "[a]ny person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws." On its face Section 4 "contains little in the way of restrictive language." Reiter v. Sonotone Corp., 442 U.S. 330, 337, 99 S.Ct. 2326, 2330, 60 L.Ed.2d 931 (1979). Section 4 reflects Congress' broad remedial and enforcement purposes in enacting the antitrust laws. See Pfizer Inc. v. India, 434 U.S. 308, 313-14, 98 S.Ct. 584, 587-88, 54 L.Ed.2d 563 (1978).

Illinois Brick stated a limitation on the otherwise broad sweep of Section 4, holding indirect purchasers of concrete block were not parties "injured" within Section 4's meaning. 431 U.S. at 729, 97 S.Ct. at 2066. Such indirect purchasers obtained concrete block from general contractors, who in turn obtained the block from masonry contractors, themselves the direct purchasers from the defendant manufacturers. Id. at 726, 97 S.Ct. at 2064-45. Three interrelated reasons were held to bar Section 4 actions by both direct and indirect purchasers:

    1. There was an unacceptable risk of
  duplicative recovery of damages from a single
  overcharge by an antitrust defendant.
  Id. at 730-31, 97 S.Ct. at 2066-67.

    2. Splintered recoveries and litigation burdens
  under a rule requiring apportionment of damages
  among direct and indirect purchasers might chill
  private enforcement of the antitrust laws.
  Id. at 745-47, 97 S.Ct. at 2074-75.

    3. Direct purchasers were the group most likely
  to press their claims vigorously under Section 4.
  Id. at 735, 97 S.Ct. at 2069.

Illinois Brick's rationale was recently summarized and reaffirmed in Blue Shield of Virginia v. McCready, ___ U.S. ___, 102 S.Ct. 2540, 2546, 73 L.Ed.2d 149 (1982). McCready held a health plan subscriber had Section 4 standing to sue for the plan's failure to reimburse psychotherapy expenses incurred for services provided by psychologists, while providing reimbursement for services rendered by psychiatrists. Although that distinction arguably harmed psychologists directly and subscribers only indirectly or remotely, id. 102 S.Ct. at 2544, the Court refused to apply Illinois Brick to bar recovery (id. 102 S.Ct. at 2546, footnote omitted):

  [Illinois Brick] focused on the risk of duplicative
  recovery engendered by allowing every person along
  a chain of distribution to claim damages arising
  from a single transaction that violated the
  antitrust laws. But permitting respondent to
  proceed in the circumstances of this case offers
  not the slightest possibility of a duplicative
  exaction from petitioners. McCready has paid her
  psychologist's bills; her injury consists of Blue
  Shield's failure to pay her. Her psychologist can
  link no claim of injury to himself arising from his
  treatment of McCready; he has been fully paid for
  his service and has not been injured by Blue
  Shield's refusal to reimburse her for the cost of
  his services. And whatever the adverse effect of
  Blue Shield's actions on McCready's employer, who
  purchased the plan, it is not the employer as
  purchaser, but his employees as subscribers, who
  are out of pocket as a consequence of the plan's
  failure to pay benefits.

Moreover, the Court went on to hold McCready had satisfied the "[a]nalytically distinct" question whether her injuries were "too remote" from an antitrust violation. Id. 102 S.Ct. at 2547. It looked (id. 102 S.Ct. at 2548):

  (1) to the physical and economic nexus between
  the alleged violation and the harm to the
  plaintiff, and,

  (2) more particularly, to the relationship of the
  injury alleged with those forms of injury about
  which Congress was likely to have been concerned
  in making defendant's conduct unlawful and in
  providing a private remedy under § 4.

Surveying the facts, the Court concluded (id. 102 S.Ct. at 2549, 2551, citations and footnote omitted):

  Where the injury alleged is so integral an aspect
  of the conspiracy alleged, there

  can be no question but that the loss was
  precisely "`the type of loss that the claimed
  violations . . . would be likely to cause.'"

  As a consumer of psychotherapy services entitled
  to financial benefits under the Blue Shield plan,
  we think it clear that McCready was "within that
  area of the economy . . . endangered by [that]
  breakdown of competitive conditions" resulting
  from Blue Shield's selective refusal to
  reimburse.

  Although McCready was not a competitor of the
  conspirators, the injury she suffered was
  inextricably intertwined with the injury the
  conspirators sought to inflict on psychologists
  and the psychotherapy market. In light of the
  conspiracy here alleged we think that McCready's
  injury "flows from that which makes defendants'
  acts unlawful" . . . and falls squarely within
  the area of congressional concern.

Oberweis (Complaint ¶ 23c-h) has alleged AMPI-CMPC control the price and supply of substantially all raw milk in the Chicago region (see also Ans.Mem. 2-3, 7). More critical to the present motion, there is evidence to indicate the AMPI-CMPC conspiracy controls the price of the raw milk Oberweis buys from all its sources.*fn19 Oberweis thus claims harm from all its purchases, harm caused by the AMPI-CMPC conspiracy. That provides the required "nexus" between AMPI-CMPC's violation and Oberweis' harm from purchases from the 23 separate suppliers.

Oberweis also asserts precisely the kind of injury with which Congress was concerned in providing the Section 4 remedy. It is irrelevant here, as in McCready, that Oberweis was not a competitor of AMPI-CMPC.*fn20 Finally (and controlling under McCready and Illinois Brick) there is no danger of duplicative recovery here. No "chain of distribution" is involved, and the 23 suppliers are not potential plaintiffs harmed by the alleged AMPI-CMPC conspiracy. It could be inferred that their prices were also set by AMPI-CMPC. In sum the concerns underlying Illinois Brick (and specifically its distinct concerns about remoteness of injury) are absent here.

McCready, as Supreme Court authority, obviates any need to discuss the District Court and Court of Appeals cases cited by AMPI-CMPC. Nevertheless all those cases are distinguishable:

    1. In Mid-West Paper Products Co., two groups of
  plaintiffs were denied Section 4 standing:

      (a) indirect purchasers, where there was no
    showing (596 F.2d at 578) "they have absorbed
    the illegal overcharge in its entirety," and

      (b) direct purchasers from defendants'
    competitors, where there was no showing
    defendants controlled or set competitors'
    prices (id. at 583-87).

  Here Oberweis has some factual predicate for its
  assertions (a) it has absorbed all the
  overcharges in its purchases from the 23
  suppliers and (b) AMPI-CMPC control the 23
  suppliers' prices.

    2. In both In re Folding Carton Antitrust
  Litigation, 88 F.R.D. 211, 217-20 (N.D.Ill. 1980)
  and Liang v. Hunt, 477 F. Supp. 891, 896 (N.D.Ill.
  1979), classic Illinois Brick situations were
  involved: Plaintiffs denied standing were linked
  only indirectly to defendants' antitrust
  violations.

    3. After briefing was completed, AMPI-CMPC
  directed attention to newly-decided
  California v. Standard Oil Co., 691 F.2d 1335 (9th
  Cir. 1982). Even a cursory reading (at 1340-41)
  discloses California was decided on classic
  Illinois

  Brick facts and special problems of "speculative"
  damages.

Illinois Brick and its progeny clearly do not bar Oberweis' recovery of damages sustained in purchases from the 23 allegedly independent suppliers of raw milk. Illinois Brick's limitations do not apply to defendants who control their "independent" competitors' prices.*fn21

Conclusion

AMPI and CMPC are bound by, and may not relitigate in this action, the Alexander determinations identified in the Summary of the "Oberweis' Motion" section of this opinion.*fn22 On the other side of the coin, the AMPI-CMPC motion for "partial summary judgment" is denied in all respects.


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