Coleman v. Cannon Oil Co.

849 F. Supp. 1458, 1993 U.S. Dist. LEXIS 19740, 1993 WL 632340
CourtDistrict Court, M.D. Alabama
DecidedNovember 19, 1993
DocketCiv. A. No. 90-T-414-S
StatusPublished
Cited by17 cases

This text of 849 F. Supp. 1458 (Coleman v. Cannon Oil Co.) is published on Counsel Stack Legal Research, covering District Court, M.D. Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Coleman v. Cannon Oil Co., 849 F. Supp. 1458, 1993 U.S. Dist. LEXIS 19740, 1993 WL 632340 (M.D. Ala. 1993).

Opinion

MEMORANDUM OPINION

MYRON H. THOMPSON, Chief Judge.

In this class-action lawsuit, plaintiffs, who are individual gasoline consumers, charged that defendants, who are retail sellers of gasoline, violated federal antitrust laws by [1462]*1462conspiring to fix gasoline prices in Dothan, Alabama. Plaintiffs are: T.R. Coleman; Bernard J. Petit; and R.L. and Lucy Middleton. Defendants are: Sunshine-Jr. Stores, Inc.; Rodney Parrish; Vernon Cannon and his company, Cannon Oil Company; Thomas Shirley and his company, Home Oil Company; and James Sheffield and his company, Sheffield Oil Company.1 Plaintiffs seek damages and injunctive relief under § 1 of the Sherman Act, 15 U.S.C.A. § 1 (West Supp. 1993), and § 4 and § 16 of the Clayton Act, 15 U.S.C.A. §§ 15, 26 (West Supp.1993). Plaintiffs properly invoked the court’s jurisdiction pursuant to 28 U.S.C.A. §§ 1331 (West 1993), 1337 (West Supp.1993).

After a month-long trial, a jury found that defendants had engaged in illegal price fixing but awarded only nominal damages of one dollar. Defendants have filed motions requesting that the court enter judgment in their favor as a matter of law. Plaintiffs have filed motions requesting that the court treble the nominal damages award and enter a final injunction prohibiting defendants from engaging in future illegal price fixing. For the reasons given below, the court will grant plaintiffs’ motion to enter a final injunction and defendant Sunshine-Jr. Stores’ motion for judgment as a matter of law and will deny the other motions.

I. BACKGROUND

Plaintiffs filed this lawsuit on April 19, 1990, charging several persons and then-businesses with conspiring to fix the retail price of gasoline in Dothan, Alabama. The original defendants consisted of the following: Sunshine-Jr. Stores; Rodney Parrish; Vernon Cannon and his company, Cannon Oil Company; Thomas Shirley and his company, Home Oil Company; and James Sheffield and his company, Sheffield Oil Company; Southeastern Oil Company, Inc.; Davis & Harp Oil Company, Inc.; Herndon Oil Company, Inc.; Beard Oil Company; A.W. Hern-don and his company, A.W. Herndon Oil Company, Inc.; McGee Oil; and Graceville Oil Company, Inc. The court certified a plaintiff class for “damages” consisting of “all individuals and entities who made retail purchases of gasoline from the defendants in the Houston County, Alabama area since April 15, 1986.”2 The court dismissed Beard Oil Company3 and entered summary judgment in favor of Southeastern Oil Company, Davis & Harp Oil Company, Herndon Oil Company, and McGee Oil Company.4 The plaintiffs settled their claims against Graceville Oil Company5 and against A.W. Herndon and his company, A.W. Herndon Oil Company.6 This case went to trial as to the remaining defendants' — Sunshine-Jr. Stores, Rodney Parrish, Vernon Cannon and Cannon Oil Company, Thomas Shirley and Home Oil Company, and James Sheffield and Sheffield Oil Company — who are collectively referred to in the remainder of this order as just the defendants. A jury found that these defendants had engaged in illegal price fixing and that they should pay nominal damages of one dollar. The parties responded to the verdict with the motions now before the court.7

[1463]*1463II. DEFENDANTS’ MOTIONS FOR JUDGMENT AS A MATTER OF LAW

As stated, plaintiffs sought relief under the antitrust laws of the United States: § 1 of the Sherman Act, 15 U.S.C.A. § 1 (West Supp.1993), and § 4 of the Clayton Act, 15 U.S.C.A. § 15 (West Supp.1993).8 Section 1 of the Sherman Antitrust Act provides that, “Every contract, combination ... or conspiracy, in restraint of trade or commerce ... is ... illegal.” Section 4 of the Clayton Act provides that “any person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws may sue therefor ... and shall recover threefold the damages by him sustained.” With these laws, “Congress was dealing with competition, which it sought to protect.” Standard Oil Co. v. F.T.C., 340 U.S. 231, 249, 71 S.Ct. 240, 249, 95 L.Ed. 239 (1951) (citation omitted). As this court explained in its instructions to the jury, “The purpose of the antitrust laws is to preserve our system of free and open competition, the most important part of our private enterprise system.” “These laws,” the court continued, “promote the concept that free competition results in the best allocation of economic resources, to the end that the consuming public may receive better goods and services at a lower cost.”

Plaintiffs charged that defendants violated § 1 of the Sherman Act by entering into a “contract, combination, or conspiracy” among themselves and with others “in restraint of trade or commerce” to fix the retail price of gasoline in the Dothan, Alabama market. With the phrase “contract, combination, or conspiracy,” Congress sought “to embrace a single concept”—that is, an agreement, express or implied, between two or more persons'—-and thus the terms in the phrase are used interchangeably. Phillip E. Areeda, Antitrust Law ¶ 1400a at 3 (1986) (hereinafter referred to as “Areeda”). Section 1 of the Sherman Act does not prohibit independent business decisions and actions. Monsanto Co. v. Spray-Rite Serv. Corp., 465 U.S. 752, 760, 104 S.Ct. 1464, 1469, 79 L.Ed.2d 775 (1984).

With the phrase “in restraint of trade or commerce,” Congress did not seek to prohibit all agreements that restrain trade or commerce but only those that impose an “unreasonable restraint.” N.C.A.A. v. Board of Regents of the University of Oklahoma, 468 U.S. 85, 98, 104 S.Ct. 2948, 2959, 82 L.Ed.2d 70 (1984). However, certain agreements, including conspiracies to fix prices, have been held to be per se unreasonable and always illegal, meaning that no demonstration of an unreasonable restraint on competition is required. Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752, 768, 104 S.Ct. 2731, 2740, 81 L.Ed.2d 628 (1984). This conclusion rests on the empirical observation that such agreements “ ‘would always or almost always tend to restrict competition and decrease output.’” N.C.A.A., 468 U.S. at 100, 104 S.Ct. at 2959 (quoting Broadcast Music, Inc. v. Columbia Broadcasting System, Inc., 441 U.S. 1, 19-20, 99 S.Ct. 1551, 1562, 60 L.Ed.2d 1 (1979)).

Finally, § 4 of the Clayton Act requires that a plaintiff who has demonstrated a Sherman Act violation also prove an injury to his or her business or property from the violation and provide some indication of the amount of damage done. Construction Aggregate Transport, Inc. v. Florida Rock Industries, Inc., 710 F.2d 752, 782 (11th Cir.1983). “The plaintiff must introduce substantial probative facts demonstrating that some damage flowed from the unlawful conspiracy.” Id.

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Bluebook (online)
849 F. Supp. 1458, 1993 U.S. Dist. LEXIS 19740, 1993 WL 632340, Counsel Stack Legal Research, https://law.counselstack.com/opinion/coleman-v-cannon-oil-co-almd-1993.