Opinion
A127485
08-24-2011
GINA O. EL SINEITTI, Plaintiff and Appellant, v. CONOCO PHILLIPS CO., Defendant and Respondent.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
(San Francisco County
Super. Ct. No. CGC-06-458663)
INTRODUCTION
Plaintiff Gina El Sineitti appeals from a judgment of the San Francisco Superior Court, dismissing defendant ConocoPhillips Co. (ConocoPhillips) from her action against defendants ConocoPhillips and Tower Energy Group (Tower) for alleged price discrimination under California Business and Professions Code sections 17045 and 21200. Dismissal followed the court's grant of summary judgment in favor of defendant ConocoPhillips. El Sineitti contends she raised triable issues of fact as to her section 21200 price discrimination claim. We shall conclude the trial court did not err in granting summary judgment as to this claim on the ground that El Sineitti cannot prove the competitive market that she asserts as the basis for her claim. We shall therefore affirm the judgment.
All statutory references are to the Business and Professions Code, unless otherwise indicated.
El Sineitti does not challenge the court's grant of summary judgment as to her claim under section 17045. Tower did not move for summary judgment and is not a party to this appeal.
FACTS AND PROCEDURAL BACKGROUND
The facts and procedural background statement is taken in large part from the court's statement of decision, which contains an accurate summary. Additional facts are contained in the discussion, where relevant.
El Sineitti was the sole proprietor and operator of a gasoline service station located at 1490 Ocean Avenue in San Francisco. From 2001 through 2007, El Sineitti's station sold Union 76-branded gasoline under an agreement with ConocoPhillips, a refiner and distributor of petroleum fuel products. El Sineitti began leasing her station from ConocoPhillips in 2001. She purchased the station in January 2006. While she was leasing the station from 2001 through 2005, ConocoPhillips supplied El Sineitti with Union 76-branded gasoline for resale at her station. When she purchased the station, El Sineitti agreed to remain a Union 76 station and to purchase her Union 76 fuel exclusively from Tower, an independent wholesaler and distributor. On December 31, 2007, El Sineitti terminated the agreements with ConocoPhillips and Tower, debranded as a Union 76 station, and began purchasing gasoline from independent suppliers.
On December 12, 2006, El Sineitti filed a complaint against Tower, asserting price discrimination claims under sections 17045 and 21200. On June 4, 2008, she filed her first amended complaint naming ConocoPhillips as a defendant. The first amended complaint asserts the same price discrimination claims against ConocoPhillips as she had asserted against Tower: namely, that El Sineitti was unlawfully charged higher prices for gasoline than other Union 76-branded stations. Her claims were premised on the theory that, from 2005 through 2007, her station competed with—and therefore should have been charged the same as—all Union 76 stations located within five miles of her station.
In her answer to ConocoPhillips's interrogatories, El Sineitti stated that her station "competes for the sale of gasoline with all Union 76-branded stations within a five (5) mile radius." She identified 14 Union 76 stations supplied by Tower as within this five-mile radius. She further stated on information and belief that she "does not contend other non-Union 76 branded retail dealers are within [the first amended complaint's] competitive market definition for purposes of the price discrimination alleged in this action."
ConocoPhillips answered on July 21, 2008. Thereafter, ConocoPhillips propounded extensive written discovery in the form of interrogatories and document requests and it took El Sineitti's deposition. On April 10, 2009, ConocoPhillips moved for summary judgment, or alternatively for summary adjudication as to each of the causes of action and claims for damages asserted by El Sineitti in the first amended complaint. ConocoPhillips asserted that El Sineitti had failed to raise a triable issue of material fact because she could not show the following essential elements of her section 21200 cause of action: (1) that her relevant competitive market included any station that allegedly received more favorable pricing, (2) that ConocoPhillips gave any of her competitors a "major" or "substantial" pricing advantage that was sustained over a significant period of time, or (3) that her business was injured as a result of ConocoPhillips's alleged acts.
The summary judgment motion also alleged El Sineitti could not show that ConocoPhillips gave any of her competitors a "secret payment or allowance"—a required element for a section 17045 cause of action. El Sineitti does not dispute the court's summary judgment grant as to this claim.
In May and June 2009, El Sineitti deposed two ConocoPhillips representatives and a third-party former employee. ConocoPhillips also made extensive document productions to El Sineitti in connection with those depositions. In June 2009, El Sineitti filed her opposition to ConocoPhillips's summary judgment motion and ConocoPhillips submitted its reply papers.
After a hearing on the motion, the trial court granted summary judgment in favor of ConocoPhillips, finding that ConocoPhillips had presented affirmative admissions by El Sineitti during discovery as to the factual basis of her claims and had identified needed evidence that she did not possess and could not reasonably obtain. Specifically, the court concluded that ConocoPhillips had satisfied its initial burden on summary judgment by producing evidence that El Sineitti did not possess and could not reasonably obtain evidence from which a reasonable juror could conclude she had sustained her burden as to each of the three elements—definition of the relevant competitive market, substantial or major price differentials over time, and actual injury to El Sineitti proximately caused by ConocoPhillips's alleged conduct. Consequently, the burden shifted to El Sineitti to set forth specific facts showing a triable issue of material fact as to each of these elements. The court concluded that El Sineitti had failed to make this showing.
On November 19, 2009, the court filed its statement of decision granting ConocoPhillips's summary judgment motion. Judgment was entered that day, dismissing ConocoPhillips from the action. This timely appeal followed.
I. Summary Judgment Standard of Review
" 'A trial court properly grants a motion for summary judgment only if no issues of triable fact appear and the moving party is entitled to judgment as a matter of law. [Citations.] The moving party bears the burden of showing the court that the plaintiff "has not established, and cannot reasonably expect to establish, a prima facie case . . . ." [Citation.]' [Citation.] '[O]nce a moving defendant has "shown that one or more elements of the cause of action, even if not separately pleaded, cannot be established," the burden shifts to the plaintiff to show the existence of a triable issue; to meet that burden, the plaintiff "may not rely upon the mere allegations or denials of its pleadings . . . but, instead, shall set forth the specific facts showing that a triable issue of material fact exists as to that cause of action. . . ." [Citation.]' [Citation.]" (Lyle v. Warner Brothers Television Productions (2006) 38 Cal.4th 264, 274; see also Nazir v. United Airlines, Inc. (2009) 178 Cal.App.4th 243, 252-253 (Nazir).)
" ' " '[W]e take the facts from the record that was before the trial court when it ruled on that motion,' " ' and we ' " ' " 'review the trial court's decision de novo, considering all the evidence set forth in the moving and opposing papers except that to which objections were made and sustained.' " ' " ' (Hughes v. Pair (2009) 46 Cal.4th 1035, 1039, quoting Lonicki v. Sutter Health Central (2008) 43 Cal.4th 201, 206.)" (Tverberg v. Fillner Construction, Inc. (2010) 49 Cal.4th 518, 522 (Tverberg).)Where the trial court has failed to rule upon evidentiary objections made in writing before a summary judgment hearing or orally at the hearing, the objection is preserved on appeal. (Reid v. Google, Inc. (2010) 50 Cal.4th 512, 517, 531-532 .) "We also ' " 'liberally construe the evidence in support of the party opposing summary judgment and resolve doubts concerning the evidence in favor of that party.' " ' [Citations.]" (Tverberg, at p. 522; see Nazir, supra, 178 Cal.App.4th at p. 254.)
"[I]f the trial court fails to rule expressly on specific evidentiary objections, it is presumed that the objections have been overruled, the trial court considered the evidence in ruling on the merits of the summary judgment motion, and the objections are preserved on appeal." (Reid v. Google, Inc., supra, 50 Cal.4th at p. 534.)
II. Price Discrimination
In 1975, the California Legislature passed section 21200 to regulate price discrimination by major distributors of motor fuel. (Shell Oil Co. v. Younger (9th Cir. 1978) 587 F.2d 34, 35.) In language paralleling section 2(a) of the Robinson-Patman Act (15 U.S.C. § 13(a) (1970)), section 21200 prohibits price discrimination where the effect of such discrimination is to lessen competition. (Ibid.)It provides in relevant part: "It is unlawful for any refiner, distributor, manufacturer, or transporter of motor vehicle fuels or oils engaged in business in this state, either directly or indirectly, to discriminate in price between different purchasers of motor vehicle fuels or oils of like grade and quality, where the effect of such discrimination is to lessen competition, or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination, or with customers of either of them.
The parties agree that because California price discrimination law closely parallels the Robinson-Patman Act, and is based upon the same policy considerations, case law under the act is considered persuasive authority by California courts. (Cf. ABC Internat. Traders, Inc. v. Matsushita Electric Corp. (1997) 14 Cal.4th 1247, 1261 [The prohibition on unearned discounts, codified as section 17045, of the Unfair Practice Act (§ 17000 et seq.), was designed to prohibit similar types of business conduct as the federal Robinson-Patman Act]; G.H.I.I. v. MTS, Inc. (1983) 147 Cal.App.3d 256, 271 [Unfair Practice Act closely parallels, and is based upon same policies as, Robinson-Patman Act]; Petroleum Sales, Inc. v. Valero Refining Co. (N.D. Cal. 2006) 2006 WL 3708062, p. *21 [applying Robinson-Patman Act analysis and the requirement that plaintiff show it was in actual competition with a favored purchaser at the time of the price differential to section 21200 claim of price discrimination].)
"Upon proof being made, at any hearing on a complaint under this section, that there has been such discrimination in price, the burden of rebutting the prima facie case thus made by showing justification shall be upon the person charged with a violation of this section." (§ 21200.)
"Mindful of the purposes of the Act and of the antitrust laws generally, [the United States Supreme Court has] explained that Robinson-Patman does not 'ban all price differences charged to different purchasers of commodities of the grade and quality,' [citation]; rather, the Act proscribes 'price discrimination only to the extent that it threatens to injure competition,' [citation]. Our decisions describe three categories of competitive injury that may give rise to a Robinson-Patman Act claim: primary line, secondary line, and tertiary line. Primary-line cases entail conduct—most conspicuously, predatory pricing—that injures competition at the level of the discriminating seller and its direct competitors. [Citations.] Secondary-line cases, of which this is one, involve price discrimination that injures competition among the discriminating seller's customers . . . ; cases in this category typically refer to 'favored' and 'disfavored' purchasers. [Citations.] Tertiary-line cases involve injury to competition at the level of the purchaser's customers. [Citation.]" (Volvo Trucks North America, Inc. v. Reeder-Simco GMC, Inc. (2006) 546 U.S. 164, 176.)
Secondary-line discrimination can be direct or indirect. "Direct discrimination occurs when a seller charges different prices to different buyers. [Citation.] Indirect discrimination occurs 'when one buyer receives something of value not offered to other buyers,' such as free goods. [Citation.]" (Lewis v. Philip Morris Inc. (6th Cir. 2004) 355 F.3d 515, 521.) Here, El Sineitti claims that the higher gasoline prices to her constituted direct discrimination.
In order to establish secondary-line discrimination, the plaintiff who is the disfavored purchaser must establish the element "that the discrimination had a prohibited effect on competition. . . . The 'prohibited effect on competition' element of the prima facie case requires that the discrimination have caused an actual injury to the disfavored purchaser. Causation is established by examining whether the favored and disfavored buyers were in actual competition with each other and proof of injury. Actual competition requires that the plaintiff prove a relevant product and geographic market to be defined."(Water Craft Management, L.L.C. v. Mercury Marine (M.D. La.2004) 361 F.Supp.2d 518, 538, third and fourth italics added (Water Craft); see also George Haug Co. Inc. v. Rolls Royce Motor Cars (2nd Cir. 1998) 148 F.3d 136, 142 ["[T]o satisfy this 'competitive nexus' requirement, 'it must . . . be shown that, as of the time the price differential was imposed, the favored and disfavored purchasers competed at the same functional level, i.e., all wholesalers or all retailers, and within the same geographic market.' [Citation.]"].)
"Thus, in summary, to establish illegal secondary-line price discrimination between purchasers, a plaintiff must prove the following elements: (1) sales made in interstate commerce; (2) the commodities sold to purchaser were of the same grade and quality as those sold to other purchasers; (3) that the seller discriminated in price between purchasers; and (4) that the discrimination had a prohibited effect on competition. A price discrimination within the meaning of §13(a) is an actual price difference. The 'prohibited effect on competition' element of the prima facie case requires that the discrimination have caused an actual injury to the disfavored purchaser. Causation is established by examining whether the favored and disfavored buyers were in actual competition with each other and proof of injury. Actual competition requires that the plaintiff prove a relevant product and geographic market to be defined. Proof of injury to competition is established prima facie by proof of a 'substantial' price discrimination between competing purchasers over time." (Water Craft, supra, 361 F.Supp.2d at p. 538, italics added.)
"The relevant geographic market . . . is 'the area in which buyers or sellers of the relevant product effectively compete.' [Citation.]" (Berlyn, Inc. v. Gazette Newspapers, Inc. (D.C. Md. 2002) 223 F.Supp.2d 718, 726 (Berlyn); see TYR Sport, Inc. v. Warnaco Swimwearn, Inc. (C.D. Cal. 2010) 709 F.Supp.2d 802, 816 (TYR Sport) [relevant geographic market is the area of effective competition where buyers can turn for alternate sources of supply].) "For purposes of [s]ection 21200, two stations 'compete' with each other only if they engage in substantial, rather than minimal, competition with each other. [Citations.]" (Madani v. Equilon Enterprises LLC (C.D. Cal. 2009) 2009 WL 2148664, *13, citing Lewis v. Philip Morris Inc., supra, 355 F.3d at p. 533 [sellers who have ability to deprive each other of significant levels of business]; Universal-Rundle Corporation v. F.T.C. (7th Cir. 1967) 382 F.2d 285, 287 [evidence must show a substantial degree of existing as opposed to minimal or sporadic competition].)
"In determining that the favored and disfavored purchasers are 'competitors,' the most obvious set of criteria that come to mind are those for defining relevant geographic and product markets. Under those criteria two sellers are in the same market if they (1) compete for sales to the same customers and (2) one seller's competition is sufficient to restrain the other's ability to set price above the competitive level. But the Robinson-Patman inquiry typically differs from the general relevant market inquiry in that the second part of the question is unnecessary. As a general matter, it need be shown only that the two sellers compete for the same customers." (XIV Hovenkamp, Antitrust Law (2d ed. 2004) ¶ 2333b, p. 97, fns. omitted.)
In Hamro v. Shell Oil Co. (9th Cir. 1982) 674 F.2d 784, the Ninth Circuit affirmed an order granting a directed verdict on the plaintiff's claim of unlawful price discrimination in violation of section 21200, where the plaintiff failed to offer substantial evidence that he was in competition with the more favored customers. (Id. at pp. 786, 790.) "Shell admitted that from January 1, 1976 through December 1979 it sold gasoline to up to ten independent retailers at a price below that charged to Hamro. However, section 21200 prohibits price discrimination by a seller only 'where the effect of such discrimination is to lessen competition, or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination, or with customers of either of them.' [Citation.] However, a review of the record reveals that Hamro failed to offer any evidence from which a reasonable person could conclude that Hamro was in competition with Shell's more favored customers." (Id. at p. 790; accord, Cain v. Chevron U.S.A., Inc. (D.Ore. 1991) 757 F.Supp.1120, 1123 [granting summary judgment under Oregon statute nearly identical to § 21200 and stating "plaintiff must establish that he was in actual and substantial competition with a favored purchaser"], aff'd. 972 F.2d 1337 (9th Cir. 1992); see also England v. Chrysler Corp. (9th Cir. 1974) 493 F.2d 269, 271-272 (England) [advantaged and disadvantaged parties must be shown to be "competing customers" at or near the time of the alleged price discrimination].)
"It is well settled that the relevant . . . geographic markets must be defined with some degree of precision to enable the trier of fact to determine if . . . antitrust laws have been violated." (Water Craft, supra, 361 F.Supp.2d at p. 541.) This is because the geographic market can be the entire nation or an area containing only a small percentage of business activity. (Ibid.)"The factors to consider in determining the economic significance of the relevant geographic market include the size, cumbersomeness, and other characteristics of the relevant product; regulatory constraints impeding the free flow of competing goods into the area; perishability of products; and transportation barriers. The economic significance of the relevant geographic market does not depend on singular elements such as population, income, political boundaries, or geographic extent. Rather, it depends on the relationship between these elements and the characteristics of competition in the relevant product market within a particular area." (Id. at pp. 541-542, fns. omitted, italics added.) For this reason "Courts consistently require that expert testimony adequately define the relevant geographic and product markets in antitrust cases." (Id. at p. 542, italics added; see, e.g., United Food Mart, Inc. v. Motiva Enterprises, LLC (S.D. Fla. 2005) 404 F.Supp.2d 1344, 1348 [granting motion to exclude the plaintiff's expert testimony that the defendant's two Shell stations were in the same relevant geographic market as the plaintiff's Shell station because the expert performed neither of two analyses generally accepted in the economics community for determining whether products or businesses compete with one another].)
III. ConocoPhillips Satisfied Its Initial Burden of Producing Evidence
El Sineitti first contends that ConocoPhillips did not meet its initial burden of producing evidence that El Sineitti "does not possess, and cannot reasonably obtain, needed evidence" to enable her to create a triable issue of material fact as to the particular element to be proven. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 854 (Aguilar).) "Summary judgment law in this state . . . continues to require a defendant moving for summary judgment to present evidence, and not simply point out that the plaintiff does not possess, and cannot reasonably obtain, needed evidence. In this particular at least, it still diverges from federal law. For the defendant must 'support[]' the 'motion' with evidence including 'affidavits, declarations, admissions, answers to interrogatories, depositions, and matters of which judicial notice' must or may 'be taken.' (Code Civ. Proc., § 437c, subd. (b).) The defendant may, but need not, present evidence that conclusively negates an element of the plaintiff's cause of action. The defendant may also present evidence that the plaintiff does not possess, and cannot reasonably obtain, needed evidence—as through admissions by the plaintiff following extensive discovery to the effect that he has discovered nothing." (Aguilar, at pp. 854-855, fns. omitted.)
El Sineitti argues that ConocoPhillips failed to meet this threshold because "it presented no evidence, other than deposition testimony of El Sineitti, one interrogatory response (No. 8), a few documents selected from El Sineitti's document production, and a deed to the [El] Sineitti Station." We disagree. The evidence presented by ConocoPhillips was sufficient to satisfy its initial burden so as to shift the burden of proof to El Sineitti to show the existence of a triable issue of material fact.
In Andrews v. Foster Wheeler LLC (2006) 138 Cal.App.4th 96, we addressed the question whether the plaintiff's nonresponsive answers to comprehensive discovery were sufficient to meet the defendant's burden of production when the defendant moves for summary judgment. We concluded that the discovery propounded by the defendant was sufficiently comprehensive and the responses to it so devoid of facts, "as to lead to the inference that plaintiffs could not prove causation upon a stringent review of the direct, circumstantial and inferential evidence contained in their interrogatory answers and deposition testimony." (Id. at p. 107.) We therefore concluded that the defendant had met its initial burden of presenting evidence sufficient to make a prima facie showing that a triable issue of fact did not exist regarding the element of causation and the burden of production shifted to plaintiffs to establish a triable issue of fact regarding that element of the cause of action. (Ibid.) "When defendants conduct comprehensive discovery, plaintiffs cannot play 'hide the ball.' " (Id. at p. 106.) If the plaintiffs respond "to comprehensive interrogatories seeking all known facts with boilerplate answers that restate their allegations, or simply provide laundry lists of people and/or documents, the burden of production will almost certainly be shifted to [the plaintiffs] once defendants move for summary judgment and properly present plaintiffs' factually devoid discovery responses." (Id. at p. 107, fn. omitted.)
In this case, ConocoPhillips took extensive discovery from El Sineitti through written discovery and deposition testimony. It submitted the following evidence from her deposition in support of its assertion that El Sineitti was unable to establish her area of effective competition: Her admission that her only support for her definition of her competitive market as all Union 76 stations within five miles of her station came from her own belief and conversations with 10 to 12 or 10 to 15 customers about their purchasing practices with Union 76 stations and their willingness to buy gasoline at another Union 76 station if it is cheaper. She could name only two such customers. She had no documents supporting her contention that specific customers were price sensitive to the purchase of gas at her station. Neither she nor anyone under her direction had ever analyzed the geographic disbursement of her customers. She admitted she had no documents to support her competitive market definition. She admitted she had no economic studies or empirical evidence to support the price sensitivity of customers. ConocoPhillips also presented evidence of El Sineitti's answers to specially prepared interrogatories wherein she was asked to specifically identify "each instance" that she lost business to other Union 76-branded retail gas stations supplied by ConocoPhillips and Tower. She responded on information and belief with the names of only two customers of her station who had told her during the time of the alleged price discrimination they would drive to another Union 76 station that was offering better retail prices. She also asserted that other customers had expressed the same position. Statements by two (or even 15) customers that they would drive to another Union 76 station that was offering better retail prices is insufficient to provide substantial evidence of the relevant competitive geographic market. (See, e.g., U.S. v. Oracle (N.D. Cal. 2004) 331 F.Supp.2d 1098, 1167.)
Nor do we accept El Sineitti's claim that defendant failed to satisfy its initial burden of proof by producing discovery responses that did not exclude the possibility that El Sineitti might reasonably obtain evidence to establish her claim. As the trial court observed in its statement of decision, El Sineitti never contended that needed evidence was still undiscovered or in possession of ConocoPhillips or third parties, nor did she move for a continuance of the motion on such grounds pursuant to Code of Civil Procedure section 437c, subdivision (h). ConocoPhillips moved for summary judgment in April 2009, nearly a year after El Sineitti had first named it as a defendant in the action and more than two years after she filed her initial complaint for price discrimination against Tower. She had ample time to initiate discovery and she in fact did conduct discovery after ConocoPhillips had moved for summary judgment. Although not identical to the "state all facts" interrogatories propounded by defendant in Andrews v. Foster Wheeler LLC, supra, 138 Cal.App.4th at pages 104-106, the questions ConocoPhillips propounded to El Sineitti at her deposition and in interrogatories constituted "comprehensive discovery" by ConocoPhillips sufficient to elicit from her all facts that she possessed or expected to obtain to support her claim. Her responses were so devoid of facts as to lead to the inference that she could not prove her competitive geographic market and so could not show ConocoPhillips had engaged in price discrimination in favor of her competitors. (Id. at p. 106.)
"If it appears from the affidavits submitted in opposition to a motion for summary judgment or summary adjudication or both that facts essential to justify opposition may exist but cannot, for reasons stated, then be presented, the court shall deny the motion, or order a continuance to permit affidavits to be obtained or discovery to be had or may make any other order as may be just. The application to continue the motion to obtain necessary discovery may also be made by ex parte motion at any time on or before the date the opposition response to the motion is due." (Code Civ. Proc., § 437c, subd. (h).)
The evidence presented by ConocoPhillips in support of its summary judgment sufficed to satisfy its initial burden on summary judgment by showing through El Sineitti's deposition and response to discovery that she did not possess, and could not reasonably obtain, needed evidence to support her claim. (Aguilar, supra, 25 Cal.4th at p. 854; Andrews v. Foster Wheeler LLC, supra, 138 Cal.App.4th at p. 106.) Consequently, ConocoPhillips made a prima facie showing that a triable issue of fact did not exist regarding El Sineitti's claimed competitive geographic market and the burden of production shifted to El Sineitti to establish a triable issue of fact regarding that element of her section 21200 price-discrimination cause of action. (Ibid.)
We reject El Sineitti's claim that she presented a prima facie case of price discrimination under section 21200 by producing evidence of a difference in prices in the sale of like goods having the requisite effect on competition. El Sineitti suggests the burden shifting provision of section 21200 "trumps" Code of Civil Procedure section 437c, and asserts that this "is a case of first impression." The assertion that the burden-shifting provision of section 21200 trumps summary judgment law was never raised in the trial court and was therefore waived. (See generally, Eisenberg et al., Civil Appeals and Writs (The Rutter Group 2010) ¶ 8:229, p. 8-155.) Moreover, under the plain language of section 21200, before the burden shifts to defendant to justify price discrimination, the plaintiff must first prove price discrimination at a hearing. Proof of the prima facie case under section 21200, as under the Robinson-Patman Act, requires a showing of actual competition, which in turn requires a showing of the relevant geographic market. (See XIV Hovenkamp, Antitrust Law, supra, ¶ 2331, pp. 91, 93 [vast majority of courts and the Federal Trade Commission interpret section 2(b) of the Robinson-Patman Act "as meaning that the burden shifts after all of the various elements of a price discrimination offense outlined in [section] 2(a), including the injury requirement, have been made out." Thus, the plaintiff has the burden of showing the requisite competitive injury]; see, e.g., Water Craft, supra, 361 F.Supp.2d at p. 538 ["actual competition requires that the plaintiff prove a relevant product and geographic market].) In this case, the trial court properly determined El Sineitti did not and could not make the necessary showing.
"Upon proof being made, at any hearing on a complaint under this section, that there has been such discrimination in price, the burden of rebutting the prima facie case thus made by showing justification shall be upon the person charged with a violation of this section." (§ 21200.)
IV. El Sineitti Failed to Establish a Triable Issue of Fact
That She Actually and Substantially Competed
With Union 76 Stations Within Five Miles
In opposition to ConocoPhillips's summary judgment motion, El Sineitti offered the following evidence to support her assertion that the relevant geographic market was all Union 76 stations within a five-mile radius of her station or, at least the single station located at 101 South Mayfair, Daly City:
(1) declarations from four alleged customers who stated they would travel five or more miles to purchase gasoline if El Sineitti's prices were too high;
(2) a declaration from El Sineitti's accountant, Albert J. Martig (whom El Sineitti identifies as an industry expert), that El Sineitti characterizes as opining that there is cross-elasticity of demand for gasoline between stations in near proximity and those that may be five to 10 miles away or further; and
(3) evidence discovered from ConocoPhillips that El Sineitti contends inferentially supported a five-mile radius geographic market. El Sineitti characterizes this evidence as:
(a) evidence that ConocoPhillips has used a varying number of price zones in the San Francisco area, from microzoning single stations to four or five zones in 2002, to a single zone for all of San Francisco and northern San Mateo County in 2008;
(b) evidence that ConocoPhillips has used data and software from Marketing Planning Solutions, Inc. (MPSI), and employed "MPSI tactics," a competition model employing software to show how much volume stations in a price zone will lose to a particular station that raises its price;
(c) evidence demonstrating that El Sineitti's station was run in an MPSI tactic showing that it was in a competitive area with other stations;
(d) evidence that stations in the "price zone" next to El Sineitti's, including the station at 101 South Mayfair in Daly City, were run in an MPSI tactic with stations as far away as 7.8 miles;
(e) evidence that the 101 South Mayfair station was taken out of the northern San Mateo County price zone and moved into a price zone in the Sunset area of San Francisco (Bay Area Zone 9), further away from El Sineitti's price zone (Bay Area Zone 32).
A. Customer declarations
The court properly found the customer declarations deficient. The four individuals, hand-picked by plaintiff, did not constitute a scientific or representative market sample of customers for her proposed economic market. As Judge Vaughn Walker has observed: "Drawing generalized conclusions about an extremely heterogeneous customer market based upon testimony from a small sample is not only unreliable, it is nearly impossible. [Citation.]" (U.S. v. Oracle Corp., supra, 331 F.Supp.2d 1098, 1167 [finding responses from five customers insufficient to establish market definition in a case involving challenge to a merger under the Clayton Act]; see also FTC v. Freeman Hospital (W.D.Mo. 1995) 911 F.Supp. 1213, 1220 [in defining relevant geographic markets, "anecdotal evidence concerning the marketplace [is] no substitute for solid economic analysis"], affd. 69 F.3d 260 (8th Cir. 1995).) There is no evidence that this sample was sufficiently large or sufficiently representative to constitute a statistically valid sample.
The four customer declarants are: William Mayta, Mark Gin, Joe Koman and Kathryn McGarey.
Further, the customer declarations themselves fall far short of providing substantial evidence for El Sineitti's proposed market definition. The customers state that price per gallon is the most important factor in their decision as to where to buy gasoline. All four bought gasoline from El Sineitti when her station was a Union 76 station and have continued to buy from her even after it became a non-branded station. All four have had repair work at her service station. Although all four state that if the price of gasoline at the Union 76 station at 999 Ocean Avenue or the station at 101 South Mayfair Street in Daly City is $.01 to $.02 per gallon less than El Sineitti's station they "would buy" or "would probably buy" from the lower priced station, all four customers also state that if they became aware that the price at another station—not identified as a Union 76 station—was significantly less per gallon, they would buy gas from the lower priced station, even if it were up to five miles away. El Sineitti's proposed relevant market includes only Union 76-branded stations, not all gas stations selling all brands of fuel. El Sineitti admitted in answer to an interrogatory that she "does not contend other non-Union 76 branded retail dealers are within [her] competitive market definition for purposes of the price discrimination alleged in this action." However, the customer declarations do not indicate that they would limit the brands of gasoline that they would purchase, given a price difference they deemed significant. Potential customer purchases from non-Union 76 stations are irrelevant to establishing El Sineitti's proposed market. Those stations do not purchase branded fuel from ConocoPhillips, and therefore could not have received more favorable pricing from ConocoPhillips than El Sineitti. (See, e.g., England, supra, 493 F.2d at pp. 271-272 ["the advantaged and disadvantaged parties must be shown to be competing customers of the giver in order for there to be discrimination"]; Richard Short Oil Co., Inc. v. Texaco, Inc. (8th Cir. 1986) 799 F.2d 415, 421 [plaintiff dealer failed to present evidence of "lost sales to any competing Texaco station as the result of the difference in prices"].) Further, the declarations also do not indicate whether a customer would necessarily drive up to five miles to purchase from another Union 76 station, regardless of whether a non-Union 76-branded station within a shorter distance was also charging lower prices than El Sineitti. (See Madani v. Equilon Enterprises LLC, supra, 2009 WL 2148664, pp. *12, 14 [denial of claim for equitable relief under section 21200 where plaintiff failed to account for the fact that alleged lost volume "likely 'went to competitors of all sorts' " including other brands such as Chevron, Arco, and Unocal].) Indeed, here all four customers continued to buy gasoline from El Sineitti's station even after she debranded as a Union 76 station.
Various individualized circumstances described in the customers' declarations also impact where they purchase gasoline, including the station's proximity to the declarant's residence, proximity to a family member's residence, proximity to work, whether he or she is traveling to shop at Costco, or whether traveling on business.
Mayta would travel over five miles from his home to obtain a price savings of $.05 to .10 per gallon.) He states: "If a station where I am buying gasoline raises its price above another station with which I am familiar and is reasonably near to my house, I will stop and buy gasoline from the lowest priced station when I need gasoline." He would "probably" buy from a Union 76 station such as the 999 Ocean Avenue station or the 101 South Mayfair Street station if its price were $.01 to .02 per gallon less than El Sineitti's station. He also travels on business and would purchase gasoline at a station over five miles from El Sineitti's station if its price were $.05 to .10 per gallon less than El Sineitti's. Finally, he has a second home in Forestville, California, where the price differential is often significant and he tries to buy gasoline there.
Gin states he has bought gasoline from "ARCO stations, including some located at distances over 5 miles from [Gin's business]."
Koman has purchased gasoline from a South San Francisco Costco station, located seven and one-half miles from his residence.
McGarey has purchased gasoline from an Olympian station in San Francisco, located about three miles from her residence.
The trial court correctly found that "by failing to account for the brand of gasoline, [El Sineitti's] customer declarations ignore a fundamental aspect of [p]laintiff's claims and proposed market definition, not to mention the other numerous and complicated factors that affect a relevant market definition."
B. Martig declaration
El Sineitti offered the declaration of her personal accountant, Albert J. Martig, whom she identified as an industry expert. Martig provides financial and marketing services, and tax work for individuals and businesses, including a large number of service stations. He has worked in that field for 39 years, including periods working as marketing representative for Mobil Oil Corporation and BP Oil Company. He specializes in service station marketing and finances and has worked with oil company owned stations and private owner-operators for both branded and independent stations. He had prepared El Sineitti's taxes for her service station for six years preceding the litigation.
With respect to identification of the geographically relevant market, Martig opined: "It is well known in the oil business that the retail price of gasoline at the pump significantly affects the volumes purchased from a particular service station. A service station that has higher gasoline prices than stations that its customers might buy from will lose customers to the lower price station. Stations in near proximity with lower gasoline prices at the pump than one with higher prices are the most likely stations to which customers will switch. However, customers that make trips in their car, whether to go to work, to go to school, to shop, [or] to visit relatives will switch to stations near to their destinations or on their way which may be 5 to 10 miles away or further if the station where they normally purchase gasoline has higher prices at the pump." (Italics added.) He also opined that when El Sineitti is charged a price that is higher than that given to stations to which her customers might switch, if she maintains the same profit margins as she has charged in the past, and raises prices, she will lose customers and sales and her volumes of gasoline pumped will go down.
Martig's declaration does not indicate that he either conducted or considered any market analysis. He does not identify any factual data upon which his conclusions are based, nor does he identify any economic basis for his conclusory statements as to how gasoline consumers behave generally, other than his assertion that "[i]t is well known" that price at the pump affects volume sold. The court found that "Mr. Martig's declaration does not present credible evidence to support [p]laintiff's proposed relevant market definition." We agree.
First, we reject El Sineitti's repeated contention that her competitive market is simple to discern and easily understood by all. Courts have recognized that, in the retail gasoline market, "proximity does not per se show actual competition." (Shell Co. (Puerto Rico) Ltd. v. Los Frailers Service Station (1st Cir. 2010) 605 F.3d 10, 26 [summary judgment for defendant affirmed on Robinson-Patman Act claims where the plaintiff "presumed" competition with three other Shell stations within two miles].) In United Food Mart, Inc. v. Motiva Enterprises, LLC, supra, 404 F.Supp.2d 1344, the court excluded the declaration of plaintiff's expert on defendant petroleum company's summary judgment motion. The court found the expert's declaration opining that the plaintiff operator's station was within the same relevant geographic market as two nearby service stations was inadmissible because it was based upon unreliable methodology. The expert did not perform a cross-price elasticity analysis or determine whether a positive correlation existed between retail prices, but merely visually observed the physical proximity of the stations and performed a comparative sales volume analysis. (Id. at pp. 1349-1350, 1352.) As the trial court here stated, "the Court cannot accept Plaintiff's proposed relevant market definition simply because Plaintiff says it is so."
In arguing that ConocoPhillips "waived" any objection to Martig's testimony, El Sineitti suggests the court refused to credit Martig's testimony because it found him unqualified on the issue of geographic markets. The court did not reject Martig's declaration on the ground that he was not qualified to testify as an expert as to the definition of the relevant geographic market. Rather, the court recognized in its statement of decision that even when properly qualified, expert opinion that is " 'purely conclusory because . . . unaccompanied by a reasoned explanation connecting the factual predicates to the ultimate conclusion . . . has no evidentiary value.' " (Jennings v. Palomar Pomerado Health Systems, Inc. (2003) 114 Cal.App.4th 1108, 1117.)
We believe the court could have excluded Martig's opinion on the basis that he was not qualified to render an opinion on customer behavior or the relevant geographic market as he had no degree or training in economics, had not studied consumer purchasing behavior or patterns in El Sineitti's proposed market or in any market, and had never testified previously in an antitrust matter. (Cf, Morgan, Strand, Wheeler & Biggs v. Radiology, Ltd. (9th Cir. 1991) 924 F.2d 1484, 1490 [non-economic witness was unqualified "to opine on a highly technical economic question" of defining a relevant geographic market; Western Parcel Exp. v. United Parcel Service (N.D.Cal. 1998) 65 F.Supp.2d 1052, 1058-1060 (Western Parcel), affd. 190 F.3d 974 [summary judgment for defendant where plaintiff's experts had no background in antitrust economics or antitrust law and had not offered opinions on market definitions in previous litigation].) ConocoPhillips asserted Martig was unqualified in writing in its reply to plaintiff's opposition and again orally at the summary judgment hearing, when counsel argued that Martig was "not qualified to give an opinion" regarding whether El Sineitti was in competition with other Union 76 stations in the antitrust economic sense. ConocoPhillips has not "waived" such objection on appeal. (Reid v. Google, Inc., supra, 50 Cal.4th 512, 526-527, 531-532 [evidentiary objection in summary judgment proceedings was made in writing before the hearing or raised orally at the hearing, the trial court's failure to rule on the objection does not waive the objection for purposes of appellate review].)
El Sineitti argues the court erroneously required expert economic testimony to define "the relatively simple market of consumers buying gas from retail stations," requiring her to provide a professional economic analysis to survive summary judgment. Of the evidence that El Sineitti did submit, none was from an expert or involved studies or other analysis defining a relevant geographic market so as to raise a triable issue as to causation by showing that she was in competition with the alleged favored buyers.
We agree with El Sineitti that whether her Union 76 station was in actual competition with other Union 76 stations within a five-mile radius is an inherently factual question. (F.T.C. v. Tenet Health Care Corp. (8th Cir. 1999) 186 F.3d 1045, 1052 ["Determination of the relevant geographic market is highly fact sensitive"]; see TYR Sport, supra, 709 F.Supp.2d at p. 816, fn. 17.) But we disagree with her argument that expert testimony is unnecessary because a jury can use its "common sense" to decide the issue.
It appears that courts are divided as to whether plaintiff must introduce expert testimony to establish the relevant market. (Coast to Coast Entertainment, LLC v. Coastal Amusements, Inc. (D.C. NJ 2005) 2005 U.S.Dist.LEXIS 26849, *56 and fn. 21 (Coast to Coast Entertainment).) Courts finding expert testimony necessary include: Morgan, Strand, Wheeler & Biggs v. Radiology, Ltd., supra, 924 F.2d 1484, 1490 [principals in the case were not experts "qualified to opine on a highly technical economic question" of the definition of the relevant market]; Bailey v. Allgas, Inc. (11th Cir. 2002) 284 F.3d 1237, 1239; Water Craft, supra, 361 F.Supp.2d 518, 542; Berlyn, supra, 223 F.Supp.2d 718, 727 and fn. 3; Virginia Vermiculite v. W.R. Grace & Co.-Conn. (W.D.Va. 2000) 108 F.Supp.2d 549, 576, n. 16.) Courts stating that expert testimony is not always required to define the relevant product market include the United States Supreme Court in Brooke Group Ltd. v. Brown & Williamson Tobacco Corp. (1993) 509 U.S. 209, 242 ["Expert testimony is useful as a guide to interpreting market facts, but it is not a substitute for them"]; Coast to Coast Entertainment, supra, 2005 U.S.Dist.LEXIS 26849, *56 and fn. 21; Anti-Monopoly, Inc. v. Hasbro, Inc. (S.D.N.Y. 1997) 958 F.Supp. 895, 904 ["experts are not always essential to defining the relevant market"]; see also Victus, Ltd. v. Collezione Europa U.S.A., Inc. (M.D.N.C. 1998) 26 F.Supp.2d 772, 786-787 (Victus)["Testimony from an economist is not necessary; however, some evidence of the effects of price increases on the proposed market, and an analysis of consumer reactions to such a scenario, would make [plaintiff's] argument more plausible"].)
See also United States v. Pabst Brewing Co. (1966) 384 U.S. 546, 549 [government need not prove "by an army of expert witnesses what constitutes a relevant 'economic' or 'geographic' market"].
Those cases observing that expert testimony is not always required do not support El Sineitti's claim that "common sense" and anecdotal evidence of the type she has submitted suffice to provide evidence from which a jury could determine the relevant market.
El Sineitti asserts that in Eastman Kodak Co. v. Image Technical Services, Inc. (1992) 504 U.S. 451, 467, the Supreme Court found without any expert testimony, that there existed a triable issue as to whether there was a relevant product market for parts and services for Kodak equipment. (Id. at pp. 481-482 ["The relevant market for antitrust purposes is determined by the choices available to Kodak equipment owners"].) The court did not discuss whether expert testimony was necessary and nothing in the case suggests that expert testimony was not necessary to define the relevant market.
In Victus, supra, 26 F.Supp.2d 772, 787, the court stated: "Economic experts may not be required, but [the plaintiff] has not provided affidavits of any witnesses who can address such questions, even if their opinions are based solely on their experience in the industry. No reasonable jury could find that a relevant market, as described by [the plaintiff], exists; therefore, summary judgment must be entered against [the plaintiff]." (Fn. omitted.)
In Brooke Group Ltd. v. Brown & Williamson Tobacco Corp., supra, 509 U.S. 209, 242, the court stated: "Expert testimony is useful as a guide to interpreting market facts, but not as a substitute for them." However, expert testimony was presented by the parties and the court made this statement in the context of rejecting the testimony of the expert. The court explained, "When an expert opinion is not supported by sufficient facts to validate it in the eyes of the law, . . . it cannot support a jury's verdict." (Ibid.)
In TYR Sport, supra, 709 F.Supp.2d 802, the district court overruled the defendant's objection to lay testimony of the plaintiffs executive vice president who had worked in the performance swimwear industry for 34 years and whose testimony regarding barriers to competition in the international market supported the plaintiff's geographical market as the United States, rather than the international market. The court distinguished Morgan, Strand, Wheeler & Biggs v. Radiology, Ltd., supra, 924 F.2d at page 1490, in which the Ninth Circuit concluded lay witness testimony on the technical subject of the relevant geographic market was impermissible. In contrast, the executive vice president in TYR Sport "testifie[d] only as to factual characteristics of the geographic market, which [was] within his competency as an industry veteran. He [did] not give a conclusory opinion on market definition, unlike the witnesses in Morgan." (TYR Sport, at p. 816, fn. 17.)
In Coast to Coast Entertainment, Inc., supra, 2005 U.S.Dist.LEXIS 26849, the court concluded that even were it to consider the information provided in plaintiff's non-expert declarations, the plaintiff had failed to demonstrate the relevant product market. (Id. at p. *56.) The court also recognized that "a plaintiff cannot prove the relevant market through generalizations about any particular industry, but instead must demonstrate the economic and commercial realities of the particular market studied. Eastman Kodak Co. v. Image Technical Servs., 504 U.S. 451, 467, 112 S. Ct. 2072, 119 L. Ed. 2d 265 (1992)." (Coast to Coast Entertainment, at pp. *51-52.)
In Anti-Monopoly, Inc. v. Hasbro, Inc., supra, 958 F.Supp. 895, 904, the plaintiff did submit the declaration and cross-elasticity reports of an expert economist "to satisfy its burden relating to market definition." Yet, the court concluded plaintiff had failed to satisfy that burden. (Id. at p. 903.)
Nevertheless, as observed in Lopatka and Page, Economic Authority and the Limits of Expertise in Antitrust Cases, 90 Cornell L.Rev. 617 (2005) (Lopatka and Page), "In antitrust litigation, the factual complexity and economic nature of the issues involved require the presentation of economic expert testimony in all but a few cases." (Id. at p. 617.) "Courts now recognize that market definition requires the sophisticated use of data and theory—a process that typically requires expert testimony.[]" (Lopatka and Page, supra, at pp. 659-660 & fn. 265.)
"See, e.g., Am. Key Corp. v. Cole Nat'l Corp., 762 F.2d 1569, 1579 (11th Cir. 1985) (holding that '[c]onstruction of a relevant economic market or a showing of monopoly power in that market cannot . . . be based upon lay opinion testimony'); Va. Vermiculite, Ltd. v. W.R. Grace & Co., [supra,] 108 F. Supp. 2d 549, 576[, fn.] 16 . . . (holding expert testimony practically necessary for market definition); Drs. Steuer & Latham, P.A. v. Nat'l Med. Enters., Inc., 672 F. Supp. 1489, 1512[, fn.] 25 (D.S.C. 1987) ('Failure to adduce expert testimony on competitive issues such as market definition augurs strongly in favor of granting summary judgment against an antitrust plaintiff), affd., 846 F.2d 70 (4th Cir. 1988) (Table). Although the court in Anti-Monopoly, Inc. v. Hasbro, Inc., [supra,]958 F. Supp. 895 . . . , aff'd., 130 F.3d 1101 (2d Cir. 1997), stated that 'experts are not always essential to defining the relevant market,' id. at 904, it cited for this proposition United States v. Pabst Brewing Co., [supra,] 384 U.S. 546, 549 . . . , which dates from an era in which market definition was not conducted on economic grounds." (Lopatka and Page, supra, 90 Cornell L.Rev. at p. 660, fn. 265.)
We agree with the district court in Berlyn, supra, 223 F.Supp.2d at page 727, that whether or not expert testimony is required as a matter of law as a predicate to finding a market definition, nevertheless, "as a practical matter, . . . it would seem impossible to prove such a complex economic question without the assistance of a qualified expert, viz., an economist." The Berlyn court granted summary judgment, concluding that the newspaper publisher plaintiffs had failed to identify the relevant product and geographic markets on their antitrust claims. (Id. at pp. 726-729, 742.) Noting that it is "unclear whether expert testimony, as a matter of law, is a necessary predicate to finding a market definition" (id. at p. 727, fn. 3), the court, nevertheless, explained: "Because they bear the burden of proving relevant market, to survive summary judgment on their antitrust claims, the plaintiffs must offer admissible evidence sufficient for a jury to find that the proposed relevant markets are accurate. See Celotex Corp., 477 U.S. at 322, 106 S.Ct. 2548 [(1986)]. Defining markets for antitrust analysis is an extremely complex task. See, e.g., Cogan v. Harford Memorial Hosp., 843 F.Supp. 1013, 1020 (D.Md.1994) (characterizing the issue of relevant geographic market as a 'highly technical economic question'); Victus, Ltd. v. Collezione Europa U.S.A., Inc., [supra,]26 F.Supp.2d 772, 786 . . . (noting that defining relevant product markets is a 'difficult economic question'). Relevant market cannot be proved through generalizations about any given industry, but instead must be based on the economic and commercial realities of the particular market studied. See Eastman Kodak Co. v. Image Tech. Servs., [supra,]504 U.S. 451, 467, 112 S.Ct. 2072, 119 L.Ed.2d 265 . . . ; Brown Shoe Co. v. United States, 370 U.S. 294, 335, 82 S.Ct. 1502, 8 L.Ed.2d 510 (1962). Thus, to prove relevant market, expert testimony is of utmost importance, and that testimony, or any other evidence, must be based on specific facts pertaining to the proposed market." (Berlyn, at pp. 726-727, fn. omitted, italics added.) Because the Berlyn court had determined the plaintiffs' proposed economic expert was "not qualified to offer his opinion as to the relevant product or geographic markets," it recognized that "plaintiffs bear the difficult, if not impossible, burden of proving the outer boundaries of a relevant market and market power without the aid of an economic expert." (Id. at p. 727.)
"In practice, economists provide the court with expert testimony to explain the relevant market and to measure the impact of the allegedly illegal conduct. [Citation.]" (Western Parcel, supra, 65 F.Supp.2d 1052 at p. 1058.) "On summary judgment, this court is not to weigh the credibility of the evidence presented, but rather decide whether the evidence presents a genuine issue of fact. But assertions in expert declarations do not automatically create genuine issues of fact. [Citation.] When expert opinions are not supported by sufficient facts, or when the indisputable record contradicts or otherwise renders the opinions unreasonable, they cannot be relied upon. Brooke Group Ltd. v. Brown & Williamson Tobacco Corp., 509 U.S. 209, 242, 113 S.Ct. 2578, 2598, 125 L.Ed.2d 168. '[E]xpert opinion evidence . . . has little probative value in comparison with the economic factors' that may dictate a particular conclusion. Matsushita [Electric Industrial Co. Ltd. v. Zenith Radio Corp. (1986)] 475 U.S. [574,] 594[, fn.] 19, 106 S.Ct. at 1360[, fn.] 19. Expert declarations may be useful as a guide in interpreting market facts, but they are not a substitute for competent economic evidence. Brooke Group, 509 U.S. at 242, 113 S.Ct. at 2598. The opinion of [plaintiffs'] experts do not create genuine fact issues about the definition of the relevant market." (Western Parcel, at p.1060, italics added.)
El Sineitti's assertion that Martig's declaration demonstrates "cross-elasticity of demand for gasoline" is unpersuasive. Martig never even used the phrase "cross-elasticity." More importantly, Martig's declaration reveals that he never performed any cross-elasticity calculation or analysis of El Sineitti's proposed geographic market. He fails even to specify how much higher he believes prices must be before consumers will travel "5 to 10 miles away or further." He does not consider brand of fuel, traffic patterns, or any other of the many factors that affect El Sineitti's actual competitive market. Moreover, his belief that consumers will purchase fuel somewhere else along their route appears to describe the "minimal" and "sporadic" type of competition that section 21200 does not encompass. (Madani v. Equilon Enterprises LLC, supra, 2009 WL 2148664 at p. *8.)
As we stated in Andrews v. Foster Wheeler LLC, supra, 138 Cal.App.4th 96, " 'It is not enough to produce just some evidence. The evidence must be of sufficient quality to allow the trier of fact to find the underlying fact in favor of the party opposing the motion for summary judgment.' [Citation.] Notably, '[p]laintiffs cannot manufacture a triable issue of fact through use of an expert opinion with self-serving conclusions devoid of any basis, explanation or reasoning.' [Citation.] '[A]n expert's opinion rendered without a reasoned explanation of why the underlying facts lead to the ultimate conclusion has no evidentiary value because an expert opinion is worth no more than the reasons and facts on which it is based.' [Citation.]" (Id. at p. 108.)
Neither Martig nor the conclusions stated in his declaration provide the admissible evidence from which a jury reasonably could find the relevant geographic market was that claimed by El Sineitti. C. Discovery from ConocoPhillips concerning "price zones"
As the trial court found, El Sineitti relied also upon documents and deposition testimony concerning ConocoPhillips's price zones. However, she "failed to articulate how the cited documents and testimony support her proposed relevant market of all Union 76-branded stations within five miles of her station." The use of price zones are "commonplace in the petroleum business and constitutes a reasonable trade practice." (Cain v. Chevron U.S.A., supra, 757 F.Supp. at p. 1125.)
On appeal, El Sineitti points to a broad range of pages, rather than to specific page cites, to support her claims. This makes our task more difficult. Nevertheless, we have reviewed all the exhibits cited by plaintiff and find the court correctly determined that she failed to articulate the link between these documents and deposition testimony and her claimed geographic market.
Initially, we note that, in her answers to ConocoPhillips's interrogatories, El Sineitti stated on information and belief that pricing zones did not correspond to relevant competitive geographic markets. She states: "Pricing zones for gasoline established by oil companies have been found not to correspond to geographic relevant markets in which there is competition between dealers. Pricing zones established by CONOCO PHILLIPS, in which the same prices are charged to all dealers within that zone, do not correspond to geographic relevant markets for retail gasoline purchases within which relevant markets there is a reasonable possibility that Union 76 customers would drive to another Union 76 branded station if the first Union 76 branded dealer raised its prices above that of another Union 76 branded dealer." This response seems antithetical to her attempt to use ConocoPhillips price zones to support her market definition.
In any event, that ConocoPhillips has used a varying number of price zones in the San Francisco area over the past 10 years does not further El Sineitti's claim to be in competition with all Union 76 stations within a five-mile radius. ConocoPhillips account representative William Buerster testified there would be "as many as three or four zones in San Francisco from 2002 to the present."
ConocoPhillips employee David Hinds's deposition testimony was that in 2002 there were two and possibly three zones in San Francisco. El Sineitti's station was in the San Francisco South Zone. The South San Francisco market tended to be volatile, so sometimes the zone would be "feathered" to avoid a significant price drop from one zone to the next. In July 2008, in response to changing competitive market conditions that did not previously exist, namely major competitors Chevron and Shell consolidating ownership of their branded stations and transitioning their price structure accordingly, the number of price zones was decreased and San Francisco and most of San Mateo were consolidated into a single wholesale price zone. This evidence does nothing to support El Sineitti's claimed geographic market, as consolidation into a single zone occurred in 2008, after her claimed damages period, beginning in 2005 and ending in 2007, when she de-branded as a Union 76 station.
Nor is the fact that ConocoPhillips used MPSI data and software to gauge localized competitive conditions helpful to El Sineitti, as she did not explain how the use of MPSI demonstrates a five-mile competitive market for her station. In her opening brief, appellant argues that her station "was run in an MPSI tactic showing that it was in a competitive area with other stations." (Italics added.) She does not limit this statement to "all other Union 76 stations within five miles of her station." At the summary judgment hearing, counsel for El Sineitti pointed to the price zone map produced by ConocoPhillips, and identified it as "showing various price zones that existed at the end of 2003 and the beginning of 2004." Again, this time period was outside the period during which she claimed price discrimination and damages.
El Sineitti submitted a document appearing to show that her station was analyzed against other stations in price zone No. 32 by estimating volume changes that would result from a five-percent price change. As the court pointed out in its statement of decision, this report showed El Sineitti's station grouped with only one other ConocoPhillips Union 76-branded station located in San Francisco—not all other Union 76 stations within five miles. Moreover, this document run date was listed as November 19, 2004—again outside plaintiff's alleged period of price discrimination.
El Sineitti also relies upon a document purporting to show that ConocoPhillips ran an MPSI competitive analysis for a station located at 101 South Mayfair Avenue in Daly City with another station as far away as 7.8 miles. This document is completely irrelevant to the question of El Sineitti's competitive geographic market. It was conceded that the 101 South Mayfair station was never in the same price zone as El Sineitti's station. Rather, as the court found, the 101 South Mayfair station had been in a zone next to El Sineitti's. So, too, that Conoco Phillips moved the Daly City station into a different price zone, or "feathered" prices across its zones, does not provide evidence that plaintiff actually competed with all Union 76 stations within five miles of her own.
Finally, these documents were not relied upon by Martig and no knowledgeable witness testified that these documents supported El Sineitti's claimed geographic market or explained how they supported an economic analysis of the geographic market.
The court in Berlyn, supra, 223 F.Supp.2d 718, rejected the plaintiffs' claim that other evidence supported their market definitions. The court found the documents relied upon by the plaintiffs were "insufficient to support their proposed market definitions, as they are either inadmissible or irrelevant." (Id. at p. 727.) These documents included internal documents of the defendant Washington Post and deposition excerpts that did "not directly speak to outer geographical boundaries and lines of competition for antitrust purposes." (Id. at p. 728.) The Washington Post documents were probative only in that they listed business statistics by county, the plaintiffs' claimed geographic market. The deposition excepts were statements of non-experts as to what the geographical lines of competition were. (Ibid.)In rejecting this evidence as sufficient evidence from which a jury could accept plaintiff's definitions of relevant market on each of the plaintiffs' antitrust claims, including a claim under the Robinson-Patman Act, the court stated: "Plaintiffs' reliance on studies conducted by the defendants is also misplaced, absent a showing that these studies dealt specifically with the markets alleged here or that they were aimed at defining relevant market for antitrust purposes." (Id. at p. 729.) D. Court did not improperly "weigh" the evidence
El Sineitti also argues that the court improperly "weighed" the evidence presented by the customer declarations and by Martig's declaration when it determined that these declarations did "not present credible evidence to support [her] proposed relevant market definition." (See Nazir, supra, 178 Cal.App.4th at p. 286, fn. 22 [noting criticism that some courts granting summary judgment in title VII and age discrimination employment cases "weigh the evidence, frequently draw inferences in favor of the moving party employer, and seemingly make credibility determinations"].) Appellant is mistaken. Although the trial court unfortunately used the term "credible evidence" in finding the declarations of the customers and of Martig to be deficient, it is apparent from the statement of decision as a whole that the court did not "weigh" the evidence in the sense we criticized in Nazir, but rather was exercising its traditional function by determining this evidence to be without sufficient weight to allow a reasonable juror to find that the plaintiff satisfied her burden of persuasion on the geographical market issue.
As our Supreme Court recognized in Aguilar, supra, 25 Cal.4th 826, "[E]ven though the court may not weigh the plaintiff's evidence or inferences against the defendants' as though it were sitting as the trier of fact, it must nevertheless determine what any evidence or inference could show or imply to a reasonable trier of fact. . . . In so doing, it does not decide on any finding of its own, but simply decides what finding such a trier of fact could make for itself. [Citations.]" (Id. at p. 856, fn. omitted.) The court noted its agreement with Areeda and Hovenkamp, Antitrust Law, that "[a]ssessing the sufficiency of the evidence to determine whether a reasonable juror could find that the plaintiff has satisfied his burden of persuasion is a traditional judicial function . . . ." (2 Areeda and Hovenkamp, Antitrust Law (3d ed. 2007) ¶ 308, p. 136.) (See Aguilar, at p. 856, fn. 26.)
"[Plaintiff] argues that the definition of the relevant market is an issue for the jury, and thus it is not appropriate for the court to rule on the relevant market in this motion. See Image Tech. Services, Inc. v. Eastman Kodak Co., 125 F.3d 1195, 1203 (9th Cir.1997) ('Ultimately what constitutes a relevant market is a factual determination for the jury'). However, as with any issue of fact, if no genuine issue exists, or if plaintiff has failed to carry its burden of going forward with the evidence, summary judgment is appropriate. See Morgan, [Strand, Wheeler & Biggs, v. Radiology, Ltd., supra,]924 F.2d at 1489-90; [citation]. It is therefore proper for this court to examine the record and the law, to decide if there are genuine fact issues concerning the relevant market." (Western Parcel, supra, 65 F.Supp.2d at p. 1058.) We have done so here and have determined that ConocoPhillips met its initial burden of presenting evidence sufficient to shift the burden of production on the issue of the relevant geographic market to El Sineitti. El Sineitti failed to establish a triable issue of fact regarding the element of causation, as she failed to produce relevant and admissible evidence of her claimed relevant geographic market such that a reasonable juror could find that the favored and disfavored stations were in actual competition with each other.
Because we affirm the trial court's grant of summary judgment on this basis, we need not address the alternative and additional bases upon which the court granted summary judgment on El Sineitti's price discrimination cause of action.
The trial court recognized that having found El Sineitti had failed to raise a triable issue of material fact as to the definition of her relevant competitive market, it "need go no further." Nevertheless, it proceeded to address the parties' remaining arguments. As to the section 21200 price discrimination cause of action, the court concluded that El Sineitti also "failed to present a triable issue of fact as to whether she received substantial price differentials over a significant period of time that resulted in competitive harm," and that she "failed to show a triable issue of fact as to whether she suffered any injury caused by ConocoPhillips."
DISPOSITION
The judgment is affirmed. ConocoPhillips is awarded its costs on this appeal.
Kline, P.J.
We concur:
Haerle, J.
Richman, J.