Clark Marine Corporation v. Cargill, Inc.

226 F. Supp. 103, 1964 U.S. Dist. LEXIS 8319, 1964 Trade Cas. (CCH) 71,043
CourtDistrict Court, E.D. Louisiana
DecidedFebruary 10, 1964
DocketCiv. A. 2618
StatusPublished
Cited by5 cases

This text of 226 F. Supp. 103 (Clark Marine Corporation v. Cargill, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Clark Marine Corporation v. Cargill, Inc., 226 F. Supp. 103, 1964 U.S. Dist. LEXIS 8319, 1964 Trade Cas. (CCH) 71,043 (E.D. La. 1964).

Opinion

WEST, District Judge.

This is an action seeking a permanent injunction, together with treble damages for alleged violation of the Federal antitrust laws, 15 U.S.C.A. § 1 et seq. Petitioner, Clark Marine Corporation, hereinafter referred to as “Clark”, originally alleged that respondents, Cargill, Inc., hereinafter referred to as “Cargill”, Cargo Carriers, Inc., hereinafter referred to as “Cargo”, Lloyd Graving, and Tom Betts, conspired to monopolize all of the docking, fleeting, switching, and repair services in the Port of Baton Rouge. During the trial, however, it was stipulated that the monopoly alleged pertained only to the fleeting and switching of grain barges.

Clark is a Louisiana corporation, organized in July, 1960, and at all times pertinent to this suit, engaged in fleeting, switching, boat cleaning, and boat repair business in the Port of Baton Rouge. Cargill is primarily a grain company, with headquarters in Minneapolis, Minnesota, which does business on an international scale. It operates the only grain elevator in the Port of Baton Rouge under lease agreement with the Greater Baton Rouge Port Commission. Cargo is primarily a water transportation company, and is a wholly-owned subsidiary of Cargill. Cargo’s primary function is to provide, either by use of its own barges and equipment, or by contract with other carriers, for the transportation of Cargill’s commodities. Lloyd Graving is the manager of Cargill’s Baton Rouge operation, and Tom Betts is the manager of Cargo’s Baton Rouge operation.

The Court having split the issues involved in this case for the purposes of trial, this cause came on for trial, without a jury, on November 4, 5, 6, 7, and 12, 1963, on the issue of liability only, i. e., for a determination of the question of whether or not respondents are liable to petitioner under the provisions of the Federal antitrust laws, 15 U.S.C.A. § 1 et seq. If liability were found to be present, the question of quantum was to be resolved by a subsequent trial limited to that issue.

After hearing five days of evidence, and after carefully considering all of the documentary evidence, as well as the briefs and arguments of counsel, this Court concludes that petitioner has failed to carry the burden of proving that respondents in any way conspired to monopolize, or that they did in fact monopolize any of the fleeting and switching business in the Port of Baton Rouge, Louisiana, in violation of the Federal antitrust laws. In accordance with this conclusion, the Court now makes the following Findings of Fact and Conclusions of Law.

FINDINGS OF FACT

1. Cargill has, since 1955, operated a grain elevator at Port Allen, Louisiana, which is located in the heart of the Baton Rouge Port. This elevator accepts grain for storage from many sources throughout the country, and is operated in competition with fourteen other large elevators in the Lower Mississippi Gulf area. Car-gill’s elevator, like those of its competitors, is primarily an export elevator. They store grain, which comes from grain surplus areas in the United States. They receive export orders calling for specific grades and types of grain, and in accordance with these orders, grain of the various grades are mixed and blended to meet the requirements of the contract. After mixing and blending, the grain is transferred from the elevator into ocean-going vessels for shipment overseas or to points of destination as called for by the contracts. Approximately 35 per cent of the grain received by Cargill moves to the Cargill elevator by railroad car, and approximately 65 per cent of the grain received moves into the port area and to the elevator by river barge. Of the 65 per cent of the grain moving into the Baton Rouge Port by barge, approximately 40 per cent is carried by barges owned or managed by Cargo, a wholly-owned subsidiary of Cargill. The balance of the grain coming into the port area by barge is carried on barges owned and *105 operated by other barge lines. These barges, which are moved up and down the Mississippi River, are made up into “tows” of several barges made up together, and are pushed up and down the river by line tow boats. In 1955, when Cargo commenced operating in the Baton Rouge Port, a tow consisted of very few barges, seldom more than three. However, as the size of line tow boats increased, the size of the tows increased, so that by 1959 a tow would normally consist of twelve to fifteen barges. In 1959 the so-called super line towboat made its appearance on the River, and these boats, being large and powerful, were capable of pushing tows consisting of thirty or more barges. As these large tows reached the port area, it is obvious that they could not be simultaneously unloaded into the elevator. Consequently, it was necessary to “park” these barges while awaiting their turn for unloading. Consequently, an area convenient to the elevator had to be provided for a sort of parking place for these barges. This area is referred to as a “fleet”, and because of the fact that these large towboats were rather unwieldy, they were not suitable for “switching” or moving the barges out of their tow and into the fleet. Consequently smaller harbor towboats are used to “switch” the barges from the tow to the fleet, and later from the fleet to another tow for return to its point of departure or elsewhere. Ordinarily the owner or operator of the “fleet” charges a certain rate per day to the owner of the barge for each day that the barge remains in the “fleet”, and the owner of the switching boat charges either a per hour fee or a per switch fee for switching a barge in or out of the fleet. Also, it is not always practical to unload the barges in the order in which they arrive at the port because of the fact that it is necessary for the elevator to mix and blend different kinds of grain in order to fill certain orders, and consequently, they must take the grain from the barge which is carrying the particular type of grain needed for the mixing and blending then in process.

2. At the time Cargill commenced business in the Port of Baton Rouge, its elevator had a capacity of approximately 2.5 million bushels of grain. In 1959 the capacity of the elevator was increased to 7.7 million bushels, and in the past year, approximately 115 million bushels of grain passed through the Cargill elevator.

3. The Port of Baton Rouge receives from 7,000 to 8,000 inbound barges per year, of which number from 60 to 70 per cent are grain barges bound for the Car-gill elevator. The remaining barges carry commodities such as gasoline, fuel oil, petroleum, sodium hydroxide, and other industrial chemicals, as well as iron ore, scrap iron, aluminum ores, etc. This suit in no way involves the switching or fleeting of any barges other than grain barges destined for the Cargill elevator. Petitioner is not now contending that defendants have in any way conspired to monopolize or have in fact monopolized the switching or fleeting of any barges other than grain barges as the testimony shows conclusively that respondents have not handled anything other than grain barges in the Port of Baton Rouge.

4. At the time of Cargill’s entry into the Port of Baton Rouge in 1955, the fleeting and switching services in the port were performed almost exclusively by two companies, Kenneth A. Hutton, and Louisiana Marine Services.

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226 F. Supp. 103, 1964 U.S. Dist. LEXIS 8319, 1964 Trade Cas. (CCH) 71,043, Counsel Stack Legal Research, https://law.counselstack.com/opinion/clark-marine-corporation-v-cargill-inc-laed-1964.