"shoe" on their foot. They have good grounds to try to do so, as Chicago Ridge noted that "a lot of water has passed under the bridge" since the Supreme Court's decision in Paramount. The Seventh Circuit left it to this court to explore the matter further. See Chicago Ridge, 855 F.2d at 470-71.
The decision whether to reopen the plaintiffs' case turns on the history of this lawsuit. The plaintiffs filed this case in 1982. They stated two counts in their complaint. Count 1 alleged that the defendants illegally boycotted the plaintiffs. Count 2 alleged that each of the Evergreen's clearances over the Chicago Ridge was illegal, as the Evergreen and Chicago Ridge were not in substantial competition. See id. at 466-67; Complaint (May 20, 1982).
On February 22, 1983, the court denied the defendants' motion for summary judgment and narrowed the issues in this case. See Chicago Ridge, 855 F.2d at 467. This ruling came before judgment in this case, and despite all that has happened since -- the court's original judgment pursuant to Rule 41(b) and the Seventh Circuit's reversal of that judgment -- that ruling stands. It has not become the Seventh Circuit's law of the case. That doctrine applies following an appeal only to those matters presented to and actually decided by the appellate court. See Parts and Elec. Motors, Inc. v. Sterling Elec., 866 F.2d 228, 231-32 (7th Cir. 1988). This court thus has the discretion to make a different determination of any matter not yet taken to judgment or determined on appeal, including its February 22, 1983 order. See Cameo Convalescent Center, Inc. v. Percy, 800 F.2d 108, 110 (7th Cir. 1986).
While this court has the power to modify its earlier order, the court believes it would prejudice the defendants to do so in this case. The record of this case demonstrates that the "modern rule of reason" case occurred to the plaintiffs very late in trial. As noted before, the court narrowed the issues for trial on February 22, 1983. The plaintiffs moved for reconsideration of this order on March 3, 1983. They raised four arguments, but did not present the modern rule of reason theory in this motion.
As the court rightly noted at the time, the motion to reconsider raised no new issues or theories about the defendants' potential liability.
On June 22, 1983, the plaintiffs amended their complaint. The defendants moved for summary judgment once again, contending that since the theaters were in substantial competition, the Evergreen's clearances over the Chicago Ridge were lawful. In their written brief in opposition to this motion, the plaintiffs did not argue that they could demonstrate the defendants' liability under the modern rule of reason. Indeed, the plaintiffs continued to believe that Paramount controlled, and that the "key issue" was "whether the theatres are in substantial competition. . . ." See Brief of Chicago Ridge . . . In Opposition to Renewed Motions of Defendants for Summary Judgment 2, 7-18 (Aug. 13, 1984). The court agreed with the plaintiffs in denying the defendants' motion -- a decision which no one asked the court to reconsider prior to trial. Substantial competition quite firmly remained the central issue in this case.
The court held trial in this matter in January 1985. Sheldon Collen, one of the plaintiffs' attorneys, argued in his opening statement that "the issue of liability revolves about the question of whether the theaters are in substantial competition." T. 12. While he briefly suggested that the presence or absence of competition bore a relation to whether a clearance was pro- or anti-competitive, the focus of his argument clearly was substantial competition. Collen acknowledged that the plaintiffs bore the burden of proof in showing the absence of competition. T. 17-18.
The defendants too focused on substantial competition in their opening statements. After hearing the opening arguments, the court observed yet again that substantial competition was the key issue. No one demurred. T. 114-18. The court then heard evidence over several days, much of it centering on the extent of competition between the theaters, and listened to arguments at the close of the plaintiffs' case. The plaintiffs presented their closing argument through two attorneys, Collen and Paul Slater. Collen spoke again of the importance of the question of substantial competition. He admitted that the plaintiffs' burden was peculiar, as they had to prove a negative: the absence of competition. Still, the issue in the case was the degree of substantial competition. T. 1459-60. With only a few lapses -- there are points in his argument where Collen describes the central issue as "the substantiality of the effect of competition of the clearance" -- Collen argued that the competition between the theaters was not substantial enough to justify the defendants' practices. T. 1477-89.
Attorney Slater tried to sing a different tune. From the start of his portion of the plaintiffs' closing argument, Slater argued that "we are proceeding under the rule of reason, which is what your Honor ordered in your February 22, 1983 opinion. As in any other rule of reason case, what we are going to try and establish here is that, on balance, the challenged conduct is anti-competitive as opposed to pro-competitive." T. 1491. As the Seventh Circuit noted in Chicago Ridge, this is the central inquiry in a modern rule of reason case, and Slater was correct in suggesting that a court could apply this analysis to clearances. But the court was quick to note that the plaintiffs had never previously asked the court to proceed under this theory:
THE COURT: If that is the case [that a court should weigh clearances for their pro- and anti-competitive effect], why didn't you file a motion for reconsideration when I wrote the summary judgment opinion and told you how we were going to try this case? Because you are telling me that I am supposed to now look at the -- in a holistic way at the totality of the facts and decide whether the restraint is reasonable, and I conclude that it isn't, then there is no pro-competitive reason for it, and if I conclude that it is, there is.
You are putting the cart before the horse, I suggest to you, Mr. Slater. And you are not trying the case in accordance with the guidance I gave you in the opinion.