M & M Medical Supplies and Service, Incorporated v. Pleasant Valley Hospital, Incorporated Pleasant Valley Home Medical Equipment, Incorporated

981 F.2d 160, 1992 WL 360560
Court of Appeals for the Fourth Circuit·Decided January 20, 1993·No. 90-3100·Published·Cited by 141 cases

Opinions

OPINION

BUTZNER, Senior Circuit Judge:

M & M Medical Supplies and Service, Inc. (M & M), a retail dealer in durable medical equipment (DME), appeals a summary judgment dismissing its antitrust action and pendent state claims against Pleasant Valley Hospital, Inc., and its subsidiary, Pleasant Valley Home Medical Equipment, Inc. (Equipment Company). M & M complains that the Hospital uses its access to patients to exclude a previously strong DME competitor from the market. The Hospital contends that M & M did not meet its burden of proving the elements of its claim.

The district court held that M & M failed to furnish sufficient proof to withstand summary judgment with respect to its claim that the Hospital and its Equipment Company monopolized and attempted to monopolize the DME market in Mason County, West Virginia, in violation of section 2 of the Sherman Act, 15 U.S.C. § 2. Specifically, the court ruled that M & M had failed to establish the relevant market and to show that the Hospital and its Equipment Company had monopoly power or had attempted to monopolize the DME market. The district court also dismissed the claim of monopoly leveraging on the ground that it is not a distinct claim under the Sherman Act. It summarily dismissed pendent state claims. M & M Medical Supplies & Service, Inc. v. Pleasant Valley Hospital, Inc., 738 F.Supp. 1017 (S.D.W.Va.1990).

A panel of this court, one judge dissenting, vacated the summary judgment entered in favor of the Hospital and its Equipment Company. 946 F.2d 886. The court then reheard the appeal en banc. Guided in part by recent decisions that were not available to the district court, we again vacate the district court’s judgment and remand the case for further proceedings.

I

Since approximately 1980, M & M has sold and rented DME to patients receiving medical care and treatment. DME is a category of medical goods that includes beds, wheelchairs, walkers, and oxygen equipment. M & M is located in Point Pleasant, West Virginia, one of four DME dealers in that community. The Hospital is a 128-bed, acute-care hospital also located in Point Pleasant. It is the only acute-care hospital in Mason County and draws approximately 65% of its patients from Mason County. The rest of the patients are drawn largely from Gallia and Meigs Counties, Ohio. Both of these Ohio counties have acute-care hospitals, and some Mason County patients use them.

Late in 1985, the Hospital found itself faced with flagging revenues because of cutbacks ordered in the rates of Medicare and Medicaid reimbursement. In response, the Hospital decided to enter the DME business as a means of bolstering its profitability. The Hospital first attempted to purchase M & M, but the parties could not come to terms. In November 1985, the Hospital opened a wholly owned subsidiary, the Equipment Company. After the founding of the Equipment Company, the gross revenues of M & M fell by more than 75%.

II

Federal Rule of Civil Procedure 56 requires the entry of summary judgment “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show [163]*163that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Fed.R.Civ.P. 56(c). “[T]he plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party’s case, and on which that party will bear the burden of proof at trial.” Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). However, “summary judgment will not lie if the dispute about a material fact is ‘genuine,’ that is, if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). A motion for summary judgment may not be defeated by evidence that is “merely colorable” or “is not sufficiently probative.” Anderson, 477 U.S. at 249-50, 106 S.Ct. at 2510-11. Summary judgment is inappropriate “even where there is no dispute as to the evidentiary facts but only as to the conclusions to be drawn therefrom.” Charbonnages de France v. Smith, 597 F.2d 406, 414 (4th Cir.1979) (quoting Pierce v. Ford Motor Co., 190 F.2d 910, 915 (4th Cir.1951)). However, respondents must show that the inferences they suggest are “reasonable in light of the competing inferences_” Matsushi-ta Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 588, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986).

? any other nonmoving party that will bear the burden of proof at trial, M & M is entitled

to have the credibility of [its] evidence as forecast assumed, [its] version of all that is in dispute accepted, all internal conflicts in it resolved favorably to [it], the most favorable of possible alternative inferences from it drawn in [its] behalf; and finally, to be given the benefit of all favorable legal theories invoked by the evidence so considered.

Charbonnages, 597 F.2d at 414. The appellate standard for review of a summary judgment is de novo. Medical Waste Assocs. v. Mayor and City Council of Baltimore, 966 F.2d 148, 150 (4th Cir.1992).

We reject M & M’s argument that the district court improperly allocated the burden of production under Fed.R.Civ.P. 56. The rule “requires the nonmoving party to go beyond the pleadings and by [its] own affidavits, or by the ‘depositions, answers to interrogatories, and admissions on file,’ designate ‘specific facts showing that there is a genuine issue for trial.’ ” Celotex Corp. v. Catrett, 477 U.S. at 324, 106 S.Ct. at 2553 (quoting Fed.R.Civ.P. 56(e)). By requiring M & M to establish that triable issues existed as to every element of its claims, the district court properly applied the doctrine of Celotex.

M & M also assigns error to the district court’s entry of a protective order under Fed.R.Civ.P. 26(c) barring it from contacting former patients of the hospital whose identity it learned through discovery. The district court acted after the Hospital complained that M & M was harassing its former patients.

An order under rule 26(c) is committed to the discretion of the trial court and will not be disturbed on appeal unless the court has abused its discretion. Keyes v. Lenoir Rhyne College,

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M & M Medical Supplies and Service, Incorporated v. Pleasant Valley Hospital, Incorporated Pleasant Valley Home Medical Equipment, Incorporated, 981 F.2d 160, 1992 WL 360560 (4th Cir. 1993).

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