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NATIONAL TIRE WHOLESALE, INC. v. WASHINGTON POST C

October 28, 1977

National Tire Wholesale, Inc. Plaintiff
v.
The Washington Post Co. Defendant



The opinion of the court was delivered by: GASCH

 GASCH, D.J.:

 In this action, plaintiff National Tire Wholesale, Inc. alleges that the advertising practices of defendant The Washington Post Company violates the Robinson-Patman and Sherman Antitrust Acts. In addition, it alleges that these acts constitute a breach of the advertising contract between plaintiff and defendant. This case is now before the Court on defendant's motion for judgment on the pleadings.

 Background

 Plaintiff National Tire Wholesale, Inc. (NTW), a retailer of tires and other related automobile accessories and services, brings this action for damages allegedly resulting from the advertising practices of the defendant Washington Post Company (Post). The gravamen of plaintiff's complaint is that the Post has consistently granted NTW's chief competitor, Market Tire Company (Market), preferential advertising positions. Plaintiff claims that the Post has continually refused to afford it "premium paid positions" purportedly on the ground that space was not available, while it has placed ads of its competitor, Market, in premium spots without requiring Market to pay any additional charge. Finally, it alleges that the Post admitted for the first time in September, 1976 that the position of ads was not randomly selected and the Post had and would continue to give Market favored treatment, because it was a preferred customer. Plaintiff asserts that these facts constitute (I) price discrimination in violation of the Robinson-Patman Act, 15 U.S.C. § 13 (1970), (II) a combination in restraint of trade in violation of section 1 of the Sherman Act, 15 U.S.C. § 1 (Supp. V 1975), and (III) a breach of contract.

 As a basis for these allegations, plaintiff alleges that newspaper advertising is virtually the only practical advertising medium for plaintiff and its competitors in the retail tire sales business; the Post has a wider circulation than any other newspaper in Washington, D.C.; marketing studies reveal that men are the principal buyers of tires and that a high percentage of men read the Sports Section; the first page of the Sports Section is not available for advertisements, the second and third pages are the most effective spots for advertisement, and the later pages are substantially less valuable. Plaintiff claims that in 1971 it entered into a series of annual written agreements with the Post for advertising space. These agreements provided the Post with discretion to determine the placement of advertisements, except that an advertiser who pays an additional charge for a "premium paid position" may specify the pages on which the advertisement is to appear, if the Post determines that the selected space is available. *fn1"

 Defendant urges dismissal of the entire action. It argues that even assuming the truth of all allegations in the complaint, Counts I and II fail to state a claim upon which relief can be granted under the Robinson-Patman and Sherman Acts. It further argues that dismissal of these two jurisdiction-conferring claims *fn2" should lead to dismissal of the pendent breach of contract claim. Thus, defendant urges dismissal of the entire complaint.

 Merits

 A. Legal Standard for Judgment on the Pleadings.

 While courts should exercise caution in granting motions that dispose of the case before trial in complex antitrust actions, see, e.g., Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 473, 7 L. Ed. 2d 458, 82 S. Ct. 486 (1962), such motions are appropriate in antitrust actions when the legal standard applicable to a motion for a judgment on the pleadings is satisfied: Assuming all factual allegations of the nonmoving party to be true, including those specifically denied by the moving party, and drawing all reasonable inferences in favor of the nonmoving party, the nonmoving party fails to state a claim upon which relief may be granted. See generally C. Wright & A. Miller, 7 Federal Practice and Procedure §§ 1367-69 (1969). As the Supreme Court in First Nat'l Bank v. Cities Service Co., 391 U.S. 253, 289-90, 20 L. Ed. 2d 569, 88 S. Ct. 1575 (1968), noted:

 
To the extent that petitioner's burden-of-proof argument can be interpreted to suggest that Rule 56(e) should, in effect, be read out of antitrust cases and permit plaintiffs to get to a jury on the basis of the allegations in their complaints, coupled with the hope that something can be developed at trial in the way of evidence to support these allegations, we decline to accept it. While we recognize the importance of preserving litigants' rights to a trial on their claims, we are not prepared to extend those rights to the point of requiring that anyone who files an antitrust complaint setting forth a valid cause of action be entitled to a full-dress trial notwithstanding the absence of any significant probative evidence tending to support the complaint.

 Indeed, both the District of Columbia Circuit and District Courts have recently granted summary judgment in favor of defendants in antitrust cases, where plaintiffs failed to establish an antitrust claim, even taking all plaintiffs' allegations as established. See Proctor v. State Farm Mutual Automobile Insurance Co., 561 F.2d 262 (D.C. Cir. 1977); R. A. Weaver & Assoc., Inc. v. Haas & Haynie Corp., No. 75-2142 (D.D.C. May 19, 1977).

 B. Robinson-Patman Claim.

 The Robinson-Patman Act ...


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