Chrysler Corp. v. Fedders Corp.

643 F.2d 1229
CourtCourt of Appeals for the Sixth Circuit
DecidedMarch 18, 1981
DocketNo. 78-1287
StatusPublished
Cited by255 cases

This text of 643 F.2d 1229 (Chrysler Corp. v. Fedders Corp.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Chrysler Corp. v. Fedders Corp., 643 F.2d 1229 (6th Cir. 1981).

Opinion

BOYCE F. MARTIN, Circuit Judge.

Chrysler Corporation appeals the dismissal of its complaint charging Fedders Corporation and others with violations of the antitrust laws. The case arose after Chrysler entered into an agreement with Fedders to sell virtually all the assets of Chrysler’s Airtemp Division. The Airtemp Division was engaged in the business of designing, manufacturing, marketing, and servicing non-automotive air-conditioning systems. The assets acquired by Fedders included the stock of various subsidiaries connected with the Airtemp operation, but excluded two subsidiaries in Australia and South Africa. Chrysler also covenanted, with certain exceptions, not to compete in the non-automotive air-conditioning market for a period of five years.

After the contract was executed, Chrysler became dissatisfied with the agreement. According to the complaint filed below, Fedders has never paid Chrysler several million dollars due under the contract.

On November 14, 1977, Chrysler brought this action under § 4 of the Clayton Act, 15 U.S.C. § 15, alleging that the defendants had violated § 1 of the Sherman Act, 15 U.S.C. § 1. The complaint charged the defendants with conspiring to manipulate the non-automotive air-conditioning market in a manner calculated to lessen and eliminate competition. In addition to the antitrust claim, Chrysler alleged twenty-two pendant claims for relief under state law.

On February 10, 1978, all the defendants except Interclisa moved, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, to dismiss the antitrust claim on the grounds that it failed to state a cause of action and that Chrysler lacked standing to sue under § 4 of the Clayton Act. They also moved under Rule 12(b)(1) to dismiss the other claims for lack of diversity.

On February 24, 1978, the District Court granted the motion to dismiss the antitrust claim. It specifically found that Chrysler met the standing requirements articulated by this Court in Malamud v. Sinclair Oil Corp., 521 F.2d 1142 (6th Cir. 1975), but went on to hold that Malamud is “wrong” in light of the Supreme Court’s decision in Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 97 S.Ct. 690, 50 L.Ed.2d 701 (1977). The District Court characterized Chrysler’s claim as a breach of contract action which lacked the element of “antitrust injury” required by Brunswick. Because this essential element was missing, the court held that Chrysler did not have standing to sue under § 4 of the Clayton Act.

[1232]*1232On March 10, 1978, defendant Interclisa, a Spanish corporation, filed a Rule 12(b)(2) and 12(bX6) motion to dismiss the complaint against it. Interclisa alleged, in addition to the arguments advanced by the Fedders defendants, that the court lacked in person-am jurisdiction over Interclisa. The District Court agreed and granted the motion, holding that Interclisa had insufficient contacts with the forum to support jurisdiction under either the Michigan long arm statute, M.C.L.A. § 600.715(2), or § 12 of the Clayton Act, 15 U.S.C. § 22. The court also denied Chrysler’s request for further discovery on the question of Interclisa’s forum contacts.

On appeal, Chrysler contends that it succeeded in making out a cause of action under § 1 of the Sherman Act and that it satisfies this circuit’s requirements for standing to sue under § 4 of the Clayton Act. It argues that our opinion in Malamud is unaffected by the Supreme Court’s Brunswick decision and that, in any event, its complaint alleges “antitrust injury.” Chrysler also claims that the District Court erred in dismissing the complaint against Interclisa on jurisdictional grounds and in refusing to allow Chrysler to conduct further discovery of jurisdictional facts.

We hold that Brunswick does not negate our decision in Malamud. Rather, the effect is cumulative; Brunswick merely adds to the standing requirements set out in Malamud. Insofar as Chrysler claims that the defendants eliminated it as a competitor in the non-automotive air-conditioning market, the District Court correctly concluded that Chrysler failed to allege “antitrust in-, jury” and therefore lacked standing under § 4 of the Clayton Act. However, certain of Chrysler’s other allegations do satisfy this circuit’s post-Brunswick standing test and should not have been dismissed.

Finally, we affirm the District Court’s finding that it lacked personal jurisdiction over Interclisa and uphold its exercise of discretion in denying Chrysler’s request for further discovery.

1. Chrysler’s Standing Under § 4 of the Clayton Act

In Malamud, supra, this Court addressed the troublesome question of standing to sue under § 4 of the Clayton Act. The plaintiffs in that case fell into three categories:

1) the individuals Jack and Ann Malamud, who were also the officers, directors, and sole shareholders of the corporate plaintiffs;

2) Maleo Petroleum, a petroleum distributing corporation; and 3) three real estate investment corporations.

In 1965, Maleo and Sinclair Oil executed a distribution agreement. The parties had an understanding that Sinclair would provide financial assistance to the Malamuds’ investment companies in their efforts to acquire and develop new service station properties. In early 1966, however, Sinclair declined to help finance several proposed real estate ventures, whereupon Maleo unsuccessfully sought an early termination of the contract. After the contract expired, the plaintiffs filed suit, alleging that Sinclair’s failure to provide financing and refusal to permit an early contract termination violated § 1 of the Sherman Act and § 3 of the Clayton Act.

Sinclair sought and was denied summary judgment. On a motion for reconsideration, it argued that all of the plaintiffs lacked standing because none of them had been “directly” injured. The District Court rejected this contention and held that all the plaintiffs had standing as defined in Association of Data Processing Service Organizations, Inc. v. Camp, 397 U.S. 150, 90 S.Ct. 827, 25 L.Ed.2d 184 (1970). However, it went on to find that neither the individual plaintiffs nor Maleo could possibly satisfy the further requirement that their injury bear a “direct” and causal relationship to the alleged antitrust violations. As for the investment company plaintiffs, however, a determination of the “directness” of their injury presented mixed questions of law and fact. Accordingly, the District Court denied summary judgment against the investment firms. It subsequently certified for appeal the threshold question of their standing to sue.

[1233]

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