CCC’s: Evergreen: Supreme Court Dodges Question of Antitrust Summary Judgment Standard, Higher Bar to Reach Jury Splitting Circuits. Will Valspar be Next Up?

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Below is a Guest Post by Richard Wolfram, counsel for Evergreen Partnering Group, Inc.  Evergreen filed suit alleging polystyrene converters and their trade association engaged in a concerted refusal to deal with the company in violation of the Sherman Act. The United States District Court for the District of Massachusetts initially dismissed the action.  Evergreen appealed and the First Circuit vacated and remanded. 720 F. 3d 33 (1st Cir. 2013).  The district court then entered summary judgment in favor of the defendants. 116 F. Supp. 3d 1.  (D. Mass. 2015). Evergreen again appealed and the First Circuit upheld the dismissal of the action.  Evergreen Partnering Group v. Pactiv Corp, et. al., 832 F. 3d 1 (1stCir. 2017).  After the First Circuit denied without comment Evergreen’s petition for rehearing, Evergreen filed a petition for certiorari with the U.S. Supreme Court.  Respondents filed an Opposition brief at the request of the Court and Evergreen filed a Reply.  (No. 16-1148.)


On October 2, 2017, the U.S. Supreme Court denied Evergreen’s petition for certiorari in its concerted refusal to deal case from the First Circuit.  Evergreen contended that the court of appeals, in dismissing the case, misinterpreted and misapplied the summary judgment standard in antitrust, and that the standard itself is the source of significant confusion and inconsistent reasoning among the federal circuits and thus calls for clarification by the Court.  Evergreen’s petition was supported by an amicus brief submitted by 12 professors of antitrust law and economics.

The Court, as is customary, gave no explanation for denying Evergreen’s petition.  The Court lost an important and timely opportunity to clarify an issue that has created tremendous confusion and inconsistency among the circuits — the proper tools for applying the summary judgment standard in antitrust.  Although the Court understandably focuses on issues of law and not fact for petitions that it accepts, one has to wonder what set of facts — with the lower court here improperly weighing evidence and making credibility determinations and applying the much-criticized equal inferences rule — would serve as a better vehicle for resolving this question.  This issue is not going away, and anyone who practices antitrust knows that. Click here and here for articles about the decision.

Confirming this comment, and on the same day, a panel of the Third Circuit Court of Appeals publicly issued a decision affirming summary judgment dismissal of a Sherman Act Section 1 oligopoly conspiracy case despite findings of 31 uniform price increases by defendants over 11 years, well over any increase in costs and despite declining demand and excess capacity.  Valspar Corp. v. Dupont,  (3d Cir., 10/2/17). Arguably pre-empting the role of the trier of fact, just as Evergreen alleged the First Circuit did in its case, the Third Circuit panel required that the plaintiff provide inferences that the alleged conspiracy was “more likely than not” rather than applying the general summary judgment standard, as repeated by the Supreme Court in Kodak, that the plaintiff show simply that a jury could reasonably find in favor of the plaintiff.  The plaintiff’s burden at trial is to prove its case by a preponderance of evidence (51%), whereas its burden on summary judgment is simply to show that a jury could reasonably find in its favor — which the Supreme Court itself has explained is less than the preponderance standard. As Evergreen explained in its petition, and as applies equally in Valspar, to require that the plaintiff show by a preponderance of evidence on summary judgment that a jury would find in its favor effectively pre-empts the role of the jury, infringes on the Seventh Amendment right of the plaintiff, and is illogical, in effect raising the bar by requiring that the plaintiff satisfy the preponderance standard at both the summary judgment phase and at trial.  Inquiring minds may wonder — will Valspar be the vehicle where the Court finally addresses these issues?  For more information on Valspar, see write-up by the American Antitrust Institute, which filed an amicus in support of the plaintiff (here).

Richard Wolfram