Boerstler v. American Medical Ass'n

16 F.R.D. 437, 1954 U.S. Dist. LEXIS 4115, 1954 Trade Cas. (CCH) 67,818
CourtDistrict Court, N.D. Illinois
DecidedJune 17, 1954
DocketNo. 54 C 58
StatusPublished
Cited by14 cases

This text of 16 F.R.D. 437 (Boerstler v. American Medical Ass'n) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Boerstler v. American Medical Ass'n, 16 F.R.D. 437, 1954 U.S. Dist. LEXIS 4115, 1954 Trade Cas. (CCH) 67,818 (N.D. Ill. 1954).

Opinion

HOFFMAN, District Judge.

This is an action for treble damages and injunctive relief. Count I alleges a conspiracy, in violation of the antitrust laws, to promote sales of General Electric’s therapeutic lamps and to hinder the sales of plaintiffs’ lamps. In substance, the plaintiffs charge a conspiracy between the American Medical Association and General Electric Company to foster the sale of the therapeutic lamps manufactured by General Electric Company by the approval of the lamps by the Council of the American Medical Association, and to discourage the sale of the plaintiffs’ lamps by refusing such approval, and the dissemination of untrue statements concerning them, all of which acts are alleged to have occurred, and to have been occurring, since 1926, when the plaintiffs secured patents.

Count II alleges a common law business tort arising from the acts alleged in Count I.

Both defendants have moved: (1) to strike or dismiss the complaint in its entirety; or in the alternative (2) to strike certain entire paragraphs or portions thereof; and (3) to compel plaintiffs to make a more definite statement in certain paragraphs.

AMA has moved to strike Counts I and: II for failure to state a claim on which relief can be granted.

Although the parties have not raised the issue in their briefs and arguments, it may be noted at the outset that a motion to strike which attacks the sufficiency of the complaint may be treated as a motion to dismiss. Shanesy v. Ford Motor Co., D.C.N.D.Ill.1946, 7 F.R.D. 199; Potter v. United States, D.C.N.D.Ill.1946, 79 F.Supp. 297. AMA [443]*443advances four grounds in support of its motion:

(1) It asserts that the plaintiffs have alleged conclusions of fact and/or law which are insufficient to constitute a 'Claim on which relief can be granted. Plaintiffs contend that they have properly alleged ultimate facts but that conclusions are to be considered in determining whether the plaintiffs have stated a cause of action.

The motion will be denied on this ground. Prior to 1954 there was a division of authority on the question of whether a pleader could properly allege conclusions as opposed to ultimate facts. Many cases supported the defendant’s contention that a conclusory allegation is insufficient. In Nelson Radio & Supply Co. v. Motorola, Inc., 5 Cir., 1952, 200 F.2d 911, 913-914, it was stated that:

“* * * in pleading a conspiracy * * * a general allegation of conspiracy, without a statement of the facts constituting the conspiracy to restrain trade, its object and accomplishment, is but an allegation of a legal conclusion, which is insufficient to constitute a cause of action.”

Professor Moore has asserted approvingly that the weight of authority permits conclusory allegations, 2 Moore, Federal Practice, 1650 (2d Ed. 1948), but he omits to cite many of the cases relied on by the defendant. However, in United States v. Employing Plasterers Ass’n, 1954, 347 U.S. 186, 74 S.Ct. 452, 454, the problem seems to have been resolved in favor of the allowance of conclusory allegations. The court said:

“The complaint plainly charged several times that the effect of all these local restraints was to restrain interstate commerce. Whether these charges be called ‘allegations of fact’ or ‘mere conclusions of the pleader’, we hold that they must be taken into account in deciding whether the Government is entitled to have its case tried * *.
“* * * And where a bona fide complaint is filed that charges every element necessary to recover, summary dismissal of a civil case for failure to set out evidential facts can seldom be justified. If a party needs more facts, it has a right to call for them under Rule 12(e) * *

Thus, a pleader in these circumstances may properly make conclusory allegations.

But even assuming the validity of the defendant’s contention, its position is still not well taken because the plaintiffs have alleged facts rather than conclusions. It is true that paragraph 18 of the complaint asserts the existence of a conspiracy in conclusory terms. However, paragraph 19 alleges the acts comprising the conspiracy, and paragraph 20 alleges the acts which effectuated the conspiracy.

(2) AMA asserts that the plaintiffs have failed to allege injury to the public and that such allegation is essential in stating a claim on which relief can be granted. The plaintiffs contend that paragraph 18, if closely read, contains an allegation of public injury; that in any event, a specific allegation is unnecessary if the facts alleged show public injury; and that the facts as alleged show public injury.

The motion of the defendant should be denied on this ground. The defendant correctly contends that the complaint must allege public injury. In Wilder Mfg. Co. v. Corn Products Refining Co., 1914, 236 U.S. 165, 174, 35 S.Ct. 398, 401, 59 L.Ed. 520, the court said:

“* * * the prohibitions of the (anti-trust laws) were enacted to prevent not the mere injury to an individual which would arise from the doing of the prohibited acts, but the harm to the general public which would be occasioned by the evils which it was contemplated would be prevented, and hence not only the [444]*444prohibitions of the statute, but the remedies which it provided, were co-extensive with such conceptions. * * *»

This statement has been relied upon in subsequent cases for the proposition that a proper complaint must show a violation of public rights. Glenn Coal Co. v. Dickinson Fuel Co., 4 Cir., 1934, 72 F.2d 885; Shotkin v. General Electric Co., 10 Cir., 1948, 171 F.2d 236; and Emich Motors Corp. v. General Motors Corp., 7 Cir., 1950, 181 F.2d 70, reversed on other grounds, 1951, 340 U.S. 558, 71 S.Ct. 408, 95 L.Ed. 534.

The Shotkin case, supra, 171 F.2d at page 239, enumerated those acts which may injure the public:

“* * * The complaint did not allege that the defendants combined and conspired to refrain from competing with each other * * *. It did not allege that the defendants conspired to raise prices. It did not charge that they combined to divide trade territory. It failed to allege that they conspired to apportion customers. It did not aver that they agreed to furnish the public commodities of inferior quality. * * * In other words, the complaint failed to allege facts from which it could be determined as a matter of law that a combination or conspiracy was entered into which .brought about * * * a deterioration in the quality of the merchandise available in the channels of commerce, or any other like evil consequence * * (Emphasis added.)

However, it is not necessary expressly to allege public injury, if the asserted facts show such injury.

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Bluebook (online)
16 F.R.D. 437, 1954 U.S. Dist. LEXIS 4115, 1954 Trade Cas. (CCH) 67,818, Counsel Stack Legal Research, https://law.counselstack.com/opinion/boerstler-v-american-medical-assn-ilnd-1954.