Technical Resource Services, Inc. v. Dornier Medical Systems, Inc.

134 F.3d 1458, 40 Fed. R. Serv. 3d 166, 1998 U.S. App. LEXIS 2005, 1998 WL 56113
CourtCourt of Appeals for the Eleventh Circuit
DecidedFebruary 12, 1998
Docket95-2565, 95-3220
StatusPublished
Cited by54 cases

This text of 134 F.3d 1458 (Technical Resource Services, Inc. v. Dornier Medical Systems, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eleventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Technical Resource Services, Inc. v. Dornier Medical Systems, Inc., 134 F.3d 1458, 40 Fed. R. Serv. 3d 166, 1998 U.S. App. LEXIS 2005, 1998 WL 56113 (11th Cir. 1998).

Opinion

ANDERSON, Circuit Judge:

These consolidated appeals arise from a civil antitrust dispute which was the subject of two jury trials. We affirm the district court’s entry of judgment for the appellee and, with one exception, affirm the district court’s award of costs to the appellee.

I. FACTS

Appellee Dornier Medical Systems, Inc. (“DMSI”) sells, supplies, and services Dornier lithotripters, which are manufactured by Dornier Medizintechnik, GmbH (“DMT”), DMSI’s German parent company. Lithotrip-ters are medical devices which dissolve kidney stones through the use of shock waves. Appellant Technical Resource Services, Inc. (“TRS”) is an independent service organization which services lithotripters.

DMT invented the first lithotripter, the HM-3, in the early 1980’s. This invention revolutionized the treatment of kidney stones by eliminating the need for invasive surgery. The next generation of Dornier lithotripters was the HM-4, which received FDA approval in 1987. 1 Both the HM-3 and the HM-4 remain in use, as does the MFL 5000, the HM-4’s successor.

TRS contends that DMSI engaged in unlawful, anticompetitive conduct in order to maintain control of the servicing market for Dornier lithotripters and to prevent competition from TRS and other independent service organizations. TRS’s allegations are as follows. TRS alleges that until 1989, DMSI’s lithotripter sales contracts required Dornier lithotripter buyers to purchase a DMSI service contract, and that these service contracts automatically renewed from year to year unless the buyer notified DMSI that it wished to terminate the contract. TRS also alleges that DMSI used various tactics to maintain control of Dornier lithotripter spare parts. In particular, TRS contends that DMSI sold parts only to Dormer lithotripter owners and users. TRS also alleges that DMSI took special advantage of the HM-3’s energy source, the shock wave generator. Rather than selling replacement shock wave generators, DMSI had an exchange program under which a shock wave generator that needed to be replaced would be exchanged with DMSI for a new one. TRS contends that DMSI’s shock wave generator exchange program prescribed an arbitrarily short lifespan for shock wave generators, limited TRS’s access to shock wave generators, and prevented TRS from performing both shock wave generator service and full HM-3 service.

The HM-3’s successor, the HM-4, uses software for its operation and servicing. This software is copyrighted, and DMSI limits access to it. The gist of TRS’s complaint regarding the HM-4 software is that DMSI has refused to provide TRS with the HM-4 diagnostic software and manuals, and that without these materials, it is cumbersome to perform service on the HM-4.

II. PROCEDURAL HISTORY

TRS filed this lawsuit against DMSI on October 11, 1991, alleging violations of §§ 1 and 2 of the Sherman Act. 2 TRS’s claim *1461 under § 1 is a tying claim: TRS contends that DMSI possessed power in the lithotrip-ter market and unlawfully used this market power to force buyers of Domier lithotrip-ters to accept unwanted service contracts. TRS thus claims that Domier lithotripters are the “tying product” and service for Dormer lithotripters is the “tied product.” TRS also claims that DMSI violated § 2 of the Sherman Act by unlawfully monopolizing and unlawfully attempting to monopolize the service market for Dornier lithotripters.

Following contentious and protracted discovery and pre-trial proceedings, this case was tried to a jury beginning on May 13, 1993. The Honorable Patricia C. Fawsett 3 presided over the seven week jury trial and submitted to the jury a special verdict form. See Fed.R.Civ.P. 49(a). Section I of the special verdict form contained three interrogatories regarding TRS’s § 2 monopolization claim. The jury wrote “No Decision” under each of these interrogatories. Section II of the special verdict form contained four interrogatories regarding TRS’s § 2 attempt to monopolize claim. The jury also wrote “No Decision” under each of these interrogatories. Section III of the special verdict form contained interrogatories regarding TRS’s § 1 tying claim. The jury responded to these interrogatories as follows:

8. Has TRS proven by a preponderance of the evidence that there were separate markets for Domier lithotripters, the tying product, and service for Dor-nier lithotripters, the tied product?
No Decision
Yes __ No_
9. Has TRS proven by a preponderance of the evidence that DMSI possessed sufficient economic power in the litho-tripter market to coerce the buyer to purchase service for Domier lithotrip-ters, the tied product?
Yes_No X
10. Has TRS proven by a preponderance of the evidence that DMSI forced the buyer to purchase the tied product? Yes_No X
11. Has TRS proven by a preponderance of the evidence that the arrangement had an anticompetitive effect in the tied product market?
No Decision
Yes_No_
12. Has DMSI proven by a preponderance of the evidence that the tying arrangement was justified by a legitimate business reason?
No Decision
Yes_No_

Section IV of the special verdict form contained two interrogatories regarding injury and damages; the jury did not respond at all to those interrogatories.

Judge Fawsett polled the jury and determined that the jurors were unanimous in their decision as to interrogatories 9 and 10, but that they were unable to reach a decision as to the remaining interrogatories. Judge Fawsett then dismissed the jury. DMSI moved for judgment on TRS’s § 1 tying claim based on the jury’s answers to interrogatories 9 and 10. Judge Fawsett denied this motion, reasoning that the jury’s failure to reach a decision on interrogatory 8 was fatally inconsistent with the jury’s answers to interrogatories 9 and 10.

A new trial was scheduled, and this ease was transferred to the Honorable Louis C. Bechtle. 4 DMSI renewed its motion for judgment on TRS’s § 1 tying claim based on the jury’s answers to interrogatories 9 and 10. Judge Bechtle reconsidered Judge Faw-sett’s earlier ruling and granted DMSI’s motion for judgment on the § 1 tying claim.

TRS’s § 2 claims were then the subject of a new jury trial before Judge Bechtle. This trial began on March 9, 1994, and lasted almost six weeks. A special verdict form was *1462 again submitted to the jury, to which the jury responded as follows:

I. SHERMAN ACT — SECTION 2 MONOPOLIZATION CLAIM
1.

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Cite This Page — Counsel Stack

Bluebook (online)
134 F.3d 1458, 40 Fed. R. Serv. 3d 166, 1998 U.S. App. LEXIS 2005, 1998 WL 56113, Counsel Stack Legal Research, https://law.counselstack.com/opinion/technical-resource-services-inc-v-dornier-medical-systems-inc-ca11-1998.