Metro Industries, Inc. v. Sammi Corp.

82 F.3d 839, 96 Daily Journal DAR 4883, 96 Cal. Daily Op. Serv. 2946, 1996 U.S. App. LEXIS 9874, 1996 WL 204094
CourtCourt of Appeals for the Ninth Circuit
DecidedApril 29, 1996
DocketNo. 94-56180
StatusPublished
Cited by12 cases

This text of 82 F.3d 839 (Metro Industries, Inc. v. Sammi Corp.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Metro Industries, Inc. v. Sammi Corp., 82 F.3d 839, 96 Daily Journal DAR 4883, 96 Cal. Daily Op. Serv. 2946, 1996 U.S. App. LEXIS 9874, 1996 WL 204094 (9th Cir. 1996).

Opinion

WIGGINS, Circuit Judge:

Metro Industries, Inc. (“Metro”), an importer and wholesaler of kitchenware, sued Sammi Corp. (“Sammi”), a South Korean exporting company, and two of its American subsidiaries alleging, inter alia, that a Korean design registration system, which gives Korean holloware producers the exclusive right to export a particular holloware design for three years, constituted a market division that is a per se violation of section 1 of the Sherman Antitrust Act, 15 U.S.C. § 1. Metro alleges that Sammi used this registration system in 1983 to prevent Metro and other kitchenware importers from acquiring Korean-made stainless steal steamers from any of Sammi’s competitors in Korea.

Metro appeals the district court’s grant of Sammi’s motion for summary judgment on Metro’s Sherman Act § 1 claim, which was based on the district court record from Vollrath Co. v. Sammi Corp., 9 F.3d 1455 (9th Cir.1993), cert. denied, — U.S. —, 114 S.Ct. 2163, 128 L.Ed.2d 886 (1994), a case in which another importer of Korean kitchenware sued Sammi for alleged violations of §§ 1 and 2 of the Sherman Act. We have jurisdiction pursuant to 28 U.S.C. § 1291 and AFFIRM.

FACTS AND PROCEDURAL HISTORY

Metro is an importer and distributor of kitchenware products. Metro started a stainless steel kitchenware business in about 1977, importing mixing bowls from a Korean supplier called Haidong. In 1978 it began to purchase bowls from Sammi,' and over the next few years, expanded its business to include other kitchenware. By 1981, importing and selling stainless steel kitchenware constituted Metro’s principal business activity.

Sammi is a large Korean trading company that purchases a wide variety of finished products, including stainless steel steamers, for export to the United States and other countries. Sammi is a member of the Korea Holloware Association. See Vollrath, 9 F.3d at 1462. This association, through a thirteen-member design registration committee, grants pattern and design registration rights for particular products based on the shape, appearance, and color of the products. Id. The registration committee consists of members from manufacturing companies, trading companies, the Korea Association of patent attorneys, and three members of Korean government organizations. A trading company, such as Sammi, can only hold a pattern design right jointly with a manufacturer. Id. Registration gives the design holder the exclusive right to export a particular design for three years, and the rights can be extended for three additional years.

.According to Metro, in late 1981, it raised the idea of a line of stainless steel steamers with Sammi, provided Sammi with models, and asked Sammi to develop samples and to prepare to supply the steamers. Sammi registered the steamer design and began to supply Metro with steamers. Metro experienced a disruption of steamer deliveries from Sammi at some time during 1983. Metro [842]*842alleges that its attempts- to order the steamers from another company were blocked by Sammi. Eventually, in late 1983, Metro was able to secure a source of steamers from a Korean company called Sambo and apparently had no further disruptions in its steamer shipments.

In December 1983, Metro filed a complaint in the United States District Court for the Central District of California against Sammi and two of its American subsidiaries alleging violations of §§ 1 and 2 of the Sherman Act (15 U.S.C. §§ 1 and 1px solid var(--green-border)">2) and §§ 2, 3, and 7 of the Clayton Act (15 U.S.C. §§ 13,14, and 18), and various violations of California law. In June 1984, the claims against Sammi were dismissed for lack of personal jurisdiction.

In June 1986, the district court commenced a bench trial on Metro’s claims against the two American subsidiaries. The essence of Metro’s case against the subsidiaries was that they had engaged in predatory pricing with the intent of monopolizing the stainless steel steamer and mixing bowl markets. After several days of trial on certain issues of the predatory pricing case, the two subsidiaries filed a motion for involuntary dismissal, pursuant to Rule 41(b) of the Federal Rules of Civil Procedure, on the grounds that Metro had not presented a prima facie case and could not present such a case with its remaining witnesses. The district court took the Rule 41(b) motion and an earlier motion for summary judgment under advisement and postponed the remainder of Metro’s trial pending the court’s decisions on Sammi’s motions.

Meanwhile, a second importer of Korean kitchenware, the Vollrath Company, filed a similar action in the same district court against Sammi and its two U.S. subsidiaries. As in Metro’s case, the district court granted Sammi’s motion to dismiss for lack of personal jurisdiction. However, in February 1988, the district court granted Vollrath’s motion to reconsider the court’s jurisdiction over Sammi, and Sammi was reinstated as a defendant in both Vollrath’s and Metro’s cases. Defendants’ 1986 motion for involuntary dismissal was denied without prejudice in May 1988.

The trial on Vollrath’s claims against Sam-mi and its subsidiaries for violation of §§ 1 and 2 of the Sherman Act and the California Unfair Trade Practices Act, based on accusations of predatory pricing and output restriction, was conducted during March and April of 1989. On April 11,1989, the jury returned a verdict in favor of Vollrath, awarding $9,478,676 in damages on the federal claims and $711,803 in damages on state law claims, for a total of over $29 million in damages after trebling the award on the federal claims. On December 27,1989, however, the district court granted judgment notwithstanding the verdict (“JNOV”) in favor of all defendants on all claims.

On appeal, we affirmed the district court’s JNOV on all of Vollrath’s theories. First, we held that the evidence presented could not support Vollrath’s claims of attempted monopolization based on a predatory pricing theory. Vollrath, 9 F.3d at 1460-62. Second, we held that Vollrath could not sustain a Sherman Act § 2 attempted monopolization claim against Sammi for its temporary assertion of its rights to a particular rice steamer design, which’ prevented Vollrath from receiving steamers from another Korean exporter for a three-month period. We found that “[t]here was insufficient evidence concerning the relevant product and geographic market and Sammi’s power in that market,” making it impossible to find a dangerous probability that Sammi could gain monopoly power- over any market in the United States. Id. at 1462.1

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82 F.3d 839, 96 Daily Journal DAR 4883, 96 Cal. Daily Op. Serv. 2946, 1996 U.S. App. LEXIS 9874, 1996 WL 204094, Counsel Stack Legal Research, https://law.counselstack.com/opinion/metro-industries-inc-v-sammi-corp-ca9-1996.