Wilson P. Abraham Construction Corporation v. Texas Industries, Inc. And Frank T. Dooley, Texas Industries, Inc., Third-Party v. Radcliff Materials, Third-Party Jahncke Service, Third Party

604 F.2d 897
CourtCourt of Appeals for the Third Circuit
DecidedNovember 29, 1979
Docket78-1788
StatusPublished

This text of 604 F.2d 897 (Wilson P. Abraham Construction Corporation v. Texas Industries, Inc. And Frank T. Dooley, Texas Industries, Inc., Third-Party v. Radcliff Materials, Third-Party Jahncke Service, Third Party) is published on Counsel Stack Legal Research, covering Court of Appeals for the Third Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wilson P. Abraham Construction Corporation v. Texas Industries, Inc. And Frank T. Dooley, Texas Industries, Inc., Third-Party v. Radcliff Materials, Third-Party Jahncke Service, Third Party, 604 F.2d 897 (3d Cir. 1979).

Opinion

604 F.2d 897

1979-2 Trade Cases 62,929

WILSON P. ABRAHAM CONSTRUCTION CORPORATION, Plaintiff,
v.
TEXAS INDUSTRIES, INC. and Frank T. Dooley, Defendants.
TEXAS INDUSTRIES, INC., Third-Party Plaintiff-Appellant,
v.
RADCLIFF MATERIALS et al., Third-Party Defendants-Appellees,
Jahncke Service, Third Party Defendant.

No. 78-1788.

United States Court of Appeals,
Fifth Circuit.

Oct. 16, 1979.
Rehearing and Rehearing En Banc Denied Nov. 29, 1979.

Benjamin R. Slater, Jr., William J. Hamlin, New Orleans, La., for third-party plaintiff-appellant.

Stone, Pigman, Walther, Whittmann & Hutchinson, Stephen H. Kupperman, Ewell P. Walther, Jr., New Orleans, La., Lemle, Kelleher, Kohlmeyer & Matthews, Dando B. Cellini, New Orleans, La., Chaffe, McCall, Phillips, Toler & Sarpy, James A. Babst, New Orleans, La., for third-party defendants-appellees.

Bell, Boyd, Lloyd, Haddad & Burns by R. Clifford Potter, Chicago, Ill., for amicus curiae Boise Cascade Corp.

Mandell & Wright, Houston, Tx.; McGovern, Opperman & Paquin, Minneapolis Mn.; Kohn, Millstein, & Cohen, Washington, D. C.; and Sachnoff, Schrager, Jones, Weaver & Rubenstein, Ltd., by Lowell E. Sachnoff, Chicago, Ill., for amici curiae plaintiffs in M.D.L.-310.

Eckert, Seamans, Cherin & Mellott, Pittsburgh, Pa.; Mills, Shirley, McMicken & Ecketl, Galveston, Tx.; Skadden, Arps, Slate, Meager & Flom, by Leslie H. Arps, New York City, for amici curiae Georgia-Pacific Corp., Westvaco Corp., and Packaging Corp. of America.

Kirkland & Ellis, by John H. Morrison, Chicago, Ill., for amici curiae Weyerhaeuser Co., and by Hammond E. Chaffetz, Chicago, Ill., for amici curiae Williamette Industries, Inc.

Appeal from the United States District Court for the Eastern District of Louisiana.

Before THORNBERRY, AINSWORTH and MORGAN, Circuit Judges.

THORNBERRY, Circuit Judge:

Texas Industries, Inc., the defendant in a civil antitrust action, appeals the dismissal of its third-party complaint impleading its alleged coconspirators and seeking contribution. The sole issue is whether a right of contribution is available to an antitrust defendant under the federal antitrust laws. We hold that there is no such right of contribution.

I.

This action was instituted on September 8, 1975, by Wilson P. Abraham Construction Corp., not a party to this appeal, against Texas Industries, Inc.1 for damages arising out of an alleged price-fixing scheme. Abraham's complaint asserts that Texas Industries and certain unnamed coconspirators engaged in an unlawful combination and conspiracy to raise and stabilize the price of ready-mix concrete in the New Orleans area in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1.2 Abraham seeks to recover treble damages under 15 U.S.C. § 15.

Discovery instituted by Texas Industries revealed that the unnamed alleged coconspirators were Radcliff Materials, Inc., Jimco, Inc., and OKC Dredging, Inc. Texas Industries then filed a third-party complaint against these parties seeking contribution from them should it be found liable to Abraham in the main demand. The third-party defendants filed motions to dismiss the third-party complaint pursuant to Rule 12(b)(6) for failure to state a claim upon which relief could be granted.

On October 4, 1977, the district court entered a Minute Entry granting the motions to dismiss the third-party complaint with prejudice on the ground that no right of contribution exists among antitrust coconspirators under federal law. Although persuaded by Texas Industries' arguments in favor of allowing contribution, the court deferred to what it considered the "weight of authority"3 denying such a right to an antitrust defendant. On March 29, 1978, the court determined that there was no just reason for delay and directed that the Minute Entry be entered as a final judgment. Texas Industries appealed.

In their briefs and at oral argument the third-party defendants correctly asserted that no federal court had ever recognized a right of contribution among antitrust coconspirators. See Olson Farms, Inc. v. Safeway Stores, Inc., (1977-2) Trade Reg.Rep. (CCH) P 61,698 (D.Utah 1977), Argued and submitted, No. 77-2068 (10 Cir. March 16, 1979); El Camino Glass v. Sunglo Glass Co., (1977-1) Trade Reg.Rep. (CCH) P 61,533 (N.D.Cal.1976); Sabre Shipping Corp. v. American President Lines, Ltd., 298 F.Supp. 1339 (S.D.N.Y.1969).4 Unfortunately for the third-party defendants, however, the most recent, and only appellate, court to specifically consider this issue abruptly jettisoned the limited precedent and adopted the very position previously rejected by the district courts. In Professional Beauty Supply, Inc. v. National Beauty Supply, Inc., 594 F.2d 1179 (8 Cir. 1979), an Eighth Circuit panel, with one judge dissenting, held that an antitrust defendant should, at least under certain circumstances, be entitled to contribution from those "joint tortfeasors"5 not sued by the plaintiff in the main demand. Although we have carefully considered the arguments set forth in the majority's opinion, we are unable to agree that a right of contribution should be allowed among violators of the antitrust laws.

II.

There is no statutory right of contribution provided for under either the Sherman Act, 15 U.S.C. § 1 et seq., or the Clayton Act, 15 U.S.C. § 12 et seq. We do not, however, interpret this omission as evidence that Congress necessarily intended to deny contribution under the antitrust laws. But see Sabre Shipping, supra, 298 F.Supp. at 1345. It is more likely that this narrow question, although a matter of some importance, never occurred to the drafters of the legislation. Our task, therefore, is to guess what Congress "would have intended on a point not present to its mind, if the point had been present."6 We agree with the case law that this issue must be resolved by reference to federal common law.7

Texas Industries advances a number of arguments for implication of a right of contribution. First, it argues that the deterrent effect of treble damages is dissipated by the possibility that only one of a number of conspirators would actually be liable for the injury. We conclude, consistent with prevailing economic theory,8 however, that that very possibility of imposition of sole liability has an enhanced deterrent effect. The chance that a participant may be faced with a full judgment is more likely to discourage anticompetitive conduct than would ensuring that each participant pays only some fair share. Allowance of contribution in effect ensures that the burden upon a particular defendant would be ameliorated by a division of liability. See Sabre Shipping Corp. v. American President Lines, Ltd., 298 F.Supp. 1339 (S.D.N.Y.1969); El Camino Glass v. Sunglo Glass Co., 1977-1 Trade Cases P 61,533 (N.D.Cal.1976).

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