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holding that courts lack jurisdiction under § 301 to adjudicate disputes arising out of a local union constitution because it is a contract between the union members and the local union
Summary of this case from [REDACTED] v. Commc'ns Workers of Am.Opinion
Editorial Note:
This opinion appears in the Federal reporter in a table titled "Table of Decisions Without Reported Opinions". (See FI CTA9 Rule 36-3 regarding use of unpublished opinions)
Argued and Submitted Aug. 2, 1999.
Appeal from the United States District Court for the Central District of California Consuelo B. Marshall, District Judge, Presiding.
Before KOZINSKI and THOMAS, Circuit Judges, and HAGEN, District Judge.
The Honorable David W. Hagen, United States District Judge for the District of Nevada, sitting by designation.
This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir. R. 36-3.
Because "federal cases interpreting the Sherman Act are applicable to problems arising under the Cartwright Act," Roth v. Rhodes, 30 Cal.Rptr.2d 706, 712 (Ct.App.1994) (citations omitted), we look to both federal and state cases in this appeal.
1. Because Classic did not present evidence showing that American National Watermattress controlled a dominant share of the waterbed heater market, it failed to prove that American had sufficient market power to effect a restraint of trade. See Rebel Oil Co. v. Atlantic Richfield Co., 51 F.3d 1421, 1434 (9th Cir.1995). * American controlled 5.8% of the market in 1988, a figure that is insufficient as a matter of law to establish market power under the Cartwright Act, Cal. Bus. & Prof.Code § 16700 et seq. (West 1997). See Exxon Corp. v. Superior Court, 60 Cal.Rptr.2d 195, 202 (Ct.App.1997) (less than 10% market share insufficient); Roth v. Rhodes, 30 Cal.Rptr.2d 706, 713 (Ct.App.1994) (16% insufficient).
Classic's argument under Fed. R. Civ. Pro. 51 that we are precluded from evaluating market power because American raised the issue for the first time on appeal is without merit, as the record shows multiple references to market power, including expert testimony. In any case, "on review of a denial of a JNOV motion, this court applies the law truly controlling the case, regardless of the jury instructions." Los Angeles Land Co. v. Brunswick Corp., 6 F.3d 1422, 1426 n. 2 (9th Cir.1993) (citing Air-Sea Forwarders, Inc. v. Air Asia Co., 880 F.2d 176, 182-83 & n. 5 (9th Cir.1989)). Market power is a threshold inquiry that is necessary to evaluate an antitrust claim under the rule of reason. See, e.g., Adaptive Power Solutions v. Hughes Missile Sys's Co., 141 F.3d 947, 951 (9th Cir.1998); Exxon, 60 Cal.Rptr.2d at 201.
Classic also failed to show that American's conduct had an adverse impact on competition in the relevant market, an "absolutely essential element of [a] rule of reason case." Kaplan v. Burroughs Corp., 611 F.2d 286, 291 (9th Cir.1979). Though Classic alleges that American conspired to put it out of business, the elimination of a single competitor is not a sufficient injury to competition to invoke the antitrust laws. See McGlinchy v. Shell Chem. Co., 845 F.2d 802, 812 (9th Cir.1988); Rutman Wine Co. v. E. & J. Gallo Winery, 829 F.2d 729, 735 (9th Cir.1987).
2. Classic claims that the verdict forms and the instructions under which the jury reached their verdict show that American engaged in an unreasonable restraint of trade, and that American's failure to object to the jury instructions precludes its challenge to the verdict. But American's motion for a directed verdict and its denial by the district court preserves the question of whether there was an adequate evidentiary basis for the jury verdict. See Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585, 600 n. 26 (1985); Air-Sea Forwarders, 880 F.2d at 182-83. Classic's claim--explicitly rejected by the district judge--that this is a per se case of group boycott or tying finds no support whatsoever in the record.
3. Classic's claim of negligent misrepresentation similarly fails as a matter of law. The primary basis of the misrepresentation claim, the Capital Stock Purchase Agreement, is a contract between Lawrence and Smetana, and did not involve or even mention American. The agreement cannot form the basis of a claim against American, which was not a party to the agreement and thus could not have misrepresented anything to Classic through its terms.
The only other evidence of misrepresentation offered by Classic involves Lawrence's failure to inform Fogel that he continued working with American. But negligent misrepresentation must be based on a positive assertion, not an omission, under California law. See Wilson v. Century 21 Great W. Realty, 18 Cal.Rptr.2d 779, 783 (Ct.App.1993). Thus, the record does not support the jury's finding of negligent misrepresentation, and this award also must be reversed.
REVERSED and REMANDED for entry of judgment in favor of American National Watermattress.