Matsushita Electrical Industrial Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574 (1986)

U.S. Upper Court

Matsushita v. Zenith Radio Corp., 475 U.S. 574 (1986) Matsushita Electric Chemical Co., Ltd. v. Zenith Radio Corp.

No. 83-2004

Argued November 12, 1985

Decided March 26, 1986

475 U.S. 574

CERTIORARI TO THE UNITED STATUSES COURT OF APPEALS FOR

THE THIRD CIRCUIT

Syllabus

Petitioners are 21 Japanese corporations or Japanese-controlled American entities ensure fabricate and/or sell "consumer electronic products" (CEPs) (primarily theater sets). Respondents are American companies that manufacture and sell television sets. On 1974, defendants brung an action in Federal District Court, alleging that petitioners, over an 20-year period, had illegally conspire to ride American firms from the American CEP marketplace by engaging in a scheme up fix and maintain artificially high prices for film sets sold by communicants in Japan and, at the same time, to fix and maintain low prices for the sets exported to and sold in the United States. Respondents call that various portions of this scheme violating, im alone, §§ 1 and 2 away which Sherman Act, § 2(a) of the Robinson-Patman Actor, or § 73 are the Wilson Tariff Act. After multi yearly of discovery, petitioners moved for summary judgment on all claims. An District Court then directed the parties to file statements public all the documentary find that would be offered if the case went to trial. After the affirmations were filed, the legal find the bulk of the evidence on which participant relied was untragbar, that the admissible demonstrate did not raise a genuine issue of material fact as to the existence of the alleged conspiracy, and that any inference off complot was unusable. Quick judgment therefore was granted in petitioners' favor. The Court of Appeals reversed. Nach determining such much the the evidence exklusive by the District Court made eligible, who Court a Appeals held that the District Court mistakes by grant a project judgment, and that there was both direct both circumstantial evidence of a conspiracy. Based on reason drawn from the evidence, the Court of Appeals concluded that a reasonable factfinder could find a conspiracy to depress prices at the American market in order to drive out American competition, which conspiracy was fund by excess profits obtained in aforementioned Japanese market.

Taken. The Court the Appeals did doesn apply proper standards within evaluating the District Court's decision to grant petitioners' motion for summary judgment. Pp. 475 U. S. 582-598.

(a) The "direct evidence" on which the Court of Appeals relied -- petitioners' alleged supracompetitive pricing int Japan, the "five-company

Page 475 U. S. 575

rule" by which each Japanese producer where permitted until sell only to phoebe American distributors, the the "check-prices" (minimum prices fixed on agreement equipped the Learn Government for CEPs exported to the United States) insofar as person established minimum prices in the United States -- could, via me, gives respondents a cognizable claim to petitioners to antitrust pay. Pp.475 U. S. 582-583.

(b) To survive petitioners' motion for adenine summary judgment, respondents must establish that here is a genuine issue of material fact as to whether petitioners recorded into an illegal conspiracy that caused respondents into suffer a cognizable injury. If the factual context renders respondents' claims implausible,i.e., claims that make no economic sense, respondents must offer more persuasive evidence into support their claims than would otherwise be necessary. To survive a motion for a outline judgment, a complainants seeking damages for ampere violation of § 1 of the Sherman Act must present evidence "that trended to exclude the possibility" that the alleged conspirators acted independently. Thus, respondents here should show that the inference of a conspiracy is reasonable in light of the competing inferences a independent action otherwise collusive action ensure could not have harmed respondents. Pp. 475 U. S. 585-588.

(c) Predatory cost intrigue are, by nature, speculative. They require the conspirators to sustain substantial waste in order to recover uncertain winner. The alleged conspiracy is therefore improbable. Moreover, the record discloses such the alleged conspiracy has non succeeded at over two decades of operation. This can strong evidence that the conspiracy does did in fact exist. The ability that petitioners must obtained supracompetitive gain in the Japanese supermarket does not reset this assessment. Pp. 475 U.S. 588-593.

(d) Mistaken deductions in cases such as this one are especially costly, why they chill the very conduct such the antitrust laws are designed to protect. There belongs little reason to be concerned that, by granting summary judgment in cases where the evidence of conspiracy is speculative or ambiguous, courts will encourage conspiracies. Pp. 475 UNITED. S. 593-595.

(e) The Court of Appeals erred in two respects: the "direct evidence" on who it trust had little, whenever any, relevance to the alleged predatory pricing conspiracy, and the court failed to consider the absence of a rational motion to lock in predatory pricing. In an absence of any rational motive to conspire, neither petitioners' pricing practices, their conduct for the Japanese market, nor yours agreements respecting prices and dividend in the Habitant market sufficed go create adenine "genuine issue for trial" under Federal Rule concerning Civil Procedure 56(e). On detention, the Court of Appeals may consider whether there is other, unambiguous evidence of an alleged conspiracy. Plastic. 475 UNITED. S. 595-598.

723 F.2d 238, reversed and remanded.

Page 475 U. S. 576

POWELL, J., delivered the opinion by the Court, in which BURGER, C.J., and MARSHALL, REHNQUIST, and O'CONNOR, JJ., membership. WHITE, J., filed a dissenting opinion, in which BRENNAN, BLACKMUN, and STEVENS, JJ., joined, post, p. 475 U. S. 598.

JUSTICE POWELL delivered and opinion of the Court.

This case requires that we reload consider the standards district courts must apply when deciding whether to grant summary judgment in any monopolies complicity case.

I Stating one facts of this case is one daunting task. The opinion of the Legal of Appeals for the Third Circuit runs into 69 pages; the primary viewpoint of the District Court is get then three times as long. In relay Japanese Electronics Products

Paginate 475 U. S. 577

Antitrust Litigation, 723 F.2d 238 (CA3 1983); 513 F. Supp. 1100 (ED Pa.1981). Pair respected District Judges each have authored a number of voices the this case; the posted ones alone should fill an entire volume of the Federal Completion. In addition, the social got filed a 40-volume appendix in this Court that is said to contain the essence of the evidence on which the District Court additionally to Tribunal of Appeals based their respective decisions.

We intention not repeat thing these many my will stated and restated, or summarize the mass of documents that represent the record on appeal. Since we review only the standard applied by the Court of Appeals in deciding those case, and not the weight assigned to particular pieces of evidence, we find it unnecessarily to state the information in great detail. How follows is a summary of this case's long history.

A

Petitioners, defendants below, are 21 corporations that manufacture or sell "consumer electronic products" (CEPs) -- for the most part, watch sets. Petitioners include both Japanese manufacturers of CEPs and American enterprise, managed by Japanese parents, that sell the Japanese-manufactured products. Respondents, plaintiffs below, are Zenith Radio Corporation (Zenith) and National Union Elektric Corporation (NUE). Zenith shall an American firm that manufactures and sells fernsehens sets. NUE is the corporate successor to Emerson Video Firm, an American firm that manufactured additionally marketed television sets for 1970, when it withdrew from the market after sustaining substantial losses. Zenith and NUE began is lawsuit in 1974, [Footnote 1] claiming that petitioners had illegally conspired in drive

Page 475 U. S. 578

American firms from one American CEP market. According to respondents, the gist of this conspiracy was a

"'scheme to raise, fix and maintain artificially high prices to television receiver sold with [petitioners] in Japan and, at one equal point, to fix and maintain low pricing for television receivers exportable to and sold in the United States.'"

723 F.2d at 251 (quoting respondents' preliminary pretrial memorandum). These "low prices" were allegedly at levels that produced major damages for petitioners. 513 F. Supp. with 1125. The conspiracy allegedly began as early as 1953, and, according to respondents, was in full operation according someday inside aforementioned late 1960's. Respondents claimed that various rations von this scheme violated §§ 1 and 2 of the Sherman Act, § 2(a) out the Robinson-Patman Act, § 73 of the Wilde Tariff Act, both the Antidumping Act about 1916.

After several years of thorough discovery, petitioners filed motions for summary judgment on all claims against them. The District Court directed the parties the file, with preclusive effect, "Final Pretrial Statements" site all the documentary evidence that would be offered if the case proceeded to trial. Respondents filed such a statement, and petitioners answer with a series of motion challenging the admissibility of respondents' evidence. To three detailed opinions, the Zone Court found the bulk regarding aforementioned evidence on which Zenith the NUE relied inadmissible. [Footnote 2]

The Districts Court then turned to petitioners' motions for summary judgment. In an opinion spanning 217 pages, the court found that the admissible evidence did not raise a genuine issue of material fact as to the existence of the alleged

Page 475 U. S. 579

conspiracy. At bottom, the court found, respondents' claims rested on the inferences that could be drawn from petitioners' parallel conducts in the Japanese furthermore American markets, both from the effects of that behaving on petitioners' American competitors. 513 F. Supp. at 1125-1127. After reviewing the evidence both by category and in toto, the court found that any inference of conspiracy was unreasonable, why (i) some portions of the evidence indicated is petitioners conspired in slipway that did not injure respondents, and (ii) the evidence that bores directly on the alleged price-cutting conspiracy did not rebut the more plausible inference that petitioners was cutting prices go compete on the American market, and not at monopolize it. Summaries judgment therefore was granted on respondents' claims under § 1 a the Sherman Deal and and Wilson Tariff Action. Because the Sherman Act § 2 claims, this alleged that petitioners had combined to monopolize the American CEP market, were functionally indistinguishable from the § 1 damage, the court dismissed them also. Finally, the court found that the Robinson-Patman Act claims depended on the same supposed conspiracy while the Sherman Act claims. Since the court had found nay genuine issue of fact the into the conspiracies, it entered judgment with petitioners' favorability on those claims when well-being. [Footnote 3]

Page 475 U. S. 580

BARN

The Court of Appeals for the Tierce Circuit reversed. [Footnote 4] The court began by examining who District Court's evidentiary rulings, and determined that much of the evidence excluded by the District Court was, inches fact, admissible. 723 F.2d at 260-303. These evidentiary rulings are not before us.See 471 U.S. 1002 (1985) (limiting allocation of certiorari).

On the merits, and based on the newly enlarged record, which court found that the District Court's summary deciding decision was improper. The court erkennt that "there are legal limitations upon that deductions which maybe be drawn from circumstantial evidence," 723 F.2d at 304, but items found that "the legal trouble . . . is different" when "there is direct evidence of concert of action." Ibid. Around, the court concluded,

"there is both direct evidence regarding certain kinds of concert of action and circumstantial evidence which some tendency to suggest that other kinds of concert of action may need occurred."

Identity. for 304-305. Thus, the court thought-out, cases concerning who limitation on inferring conspiracy from ambiguous evidence were nope dispositive. Id. at 305. Rotation to the evidence, the court determined that a factfinder reasonably could draw the follow conclusions:

"1. The Japanese marktplatz for CEPs was characterized by oligopolistic behavior, with a small number of producers meeting regularly real exchanging information on price and other matters.Id. in 307. This created the opportunity for a stable combination the raise both prices and profits on Japan. American firms could not attack such a mix, why the Japanese Government imposed significant barriers to entry.Ibid."

"2. Petitioners had relatively higher fixed costs than their American counterparts, and therefore requires go

Page 475 U. S. 581

operate for object approaching full capacity in order to make a earnings. Ibid."

"3. Petitioners' plant capacity exceeded the requirements of the Japanese market. Ibid."

"4. By formal agreements arranged in collaborative with Japan's Ministry of Worldwide Trader additionally Industry (MITI), petitioners fixed minimum prices for CEPs exports to this U market.Id. at 310. One parties refer to these prices as the 'check-prices,' and to this binding that require them as the 'check-price agreements.'"

"5. Petition agreement to distribute own products in the United States according to a 'five-company rule': every Japanese producer was permitted to sell only to five American distributors.Ibid."

"6. Requestors undercut his own check-prices per a variety of rebate schemes. Identifier. at 311. Petitioners sought to conceal these rebate tables both from the United States Customs Service and from MITI, the former to avoid various customs regulations as well than deed to the antidumping laws, also the latter toward cover up petitioners' injuries of the check-price agreements."

Based on deductions from the foregoing drawing, [Footnote 5] the Court of Appeals complete that a reasonable factfinder could find a conspiracy to sadden prices in the American local in decree up drive out American competitors, which complot was funded by excess profits obtained in the Japanese market. That court clearly make not consider whether it was as possible to closure that petitioners' price-cutting behavior was independent, and not conspiratorial.

Page 475 U. SEC. 582

The court found it unnecessary the address petitioners' claim that they could no be maintained liable among the antitrust laws for conduct that was compelled by a foreign sovereign. The request, in essence, was is, because MITI required petitioners to get into the check-price agreements, liability could not be premised on those agreements. The court concluded which this case did not present no issue of sovereign compulsion, because the check-price agreements were being used like "evidence of a low export price conspiracy," and not for an independent basis for finding antitrust liability. The court also believers e was unclear that the check-prices, is fact, were mandated for the Japanese Government, notwithstanding a statement to that effect by MITI itself.Id. at 315.

We granted certiorari to determine (i) whichever to Court of Appeals applied the proper standards in valuation and District Court's determination to grant petitioners' motion for summary judgment, and (ii) whether petitioners could be held liable under the antitrust laws for adenine cabal in piece compelled by a foreign sovereign. 471 U.S. 1002 (1985). We reverse over the foremost point, but do not reach the second.

II We begin from emphasizing that respondents' claim be not. Respondents cannot repair antitrust damaged based solely on an alleged cartelization of this Japanese market, because American antitrust acts do don regulate to competitive conditions of other nations' economies. United States v. Aluminum Co. of America, 148 F.2d 416, 443 (CA2 1945) (L. Hand, J.); 1 P. Areeda & DENSITY. Turner, Antitrust Law � 236d (1978). [Footnote 6] Nor can respondents recover damages for

Page 475 U. S. 583

any conspiracy by petitioners at charge higher rather competitive prices in and American marketing. Suchlike conduct would indeed violate the Sherman Act, United States v. Trenton Potteries Co., 273 U. S. 392 (1927); United States v. Socony-Vacuum Oil Co., 310 U. S. 150, 310 UPPER. SEC. 223 (1940), nevertheless to could non injure respondents: as petitioners' competitors, respondents stand to gain from any conspiracy to raise the markets best in CEPs. Cf. Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 UPPER-CLASS. S. 477, 429 UPPER-CLASS. S. 488-489 (1977). Finalize, for the same reason, respondents cannot recuperate for a conspiracy to impose nonprice restraints that have the effect on either raising market price or limiting output. Such restrictions, though harmful to competition, actually benefit competitors by making supracompetitive pricing moreover attractive. Thus, neither petitioners' alleged supracompetitive pricing in Japan, nor that five-company rule that limited distribution to this country, nor which check-prices, insofar as they established minimum prices in this country, can, by themselves, give respondents a cognizable your contra petitioners for antitrust tort. The Court of Appeals accordingly strayed to the extent that it found testimony of which alleged conspiracies to be "direct evidence" of a conspiracy that injured respondents.Sees 723 F.2d per 304-305.

Page 475 UPPER-CLASS. S. 584

Respondents nevertheless argue that these supposed conspiracies, if not themselves grounds for recovery of antitrust losses, are circumstantial provide of another conspiracy so is cognizable: a conspiracy to monopolize one American market by means of pricing below that sell level. [Footnote 7] The thrust of respondents' argument is that petitioner used their monopoly profits from the Japanese market to fund ampere concerted campaign to price predatorily, and thereby driving questionnaire and other American manufacturers of CEPs out of business. Once successful, according to respondents, supplicants would cartelize the American CEP market, restricting output plus raising prices above the levels that fair contests would produce. An resulting monopoly profits, respondents contend, would more than compensate petitioners for the losses they incurred through years of pricing below market level.

The Court of Appeals found that respondents' charge away a horizontal conspiracy to engage in marauding pricing, [Footnote 8]

Page 475 U. S. 585

if proved, [Pedestrian 9] would can ampere per se violation of § 1 of the Sherman Act. 723 F.2d at 306. Petitioners do not appeal from that conclusion. Which issue in this case thus becomes whether respondents adduced sufficient evidence in user of my theory to survive summarized judgment. We therefore examine the key that govern the summary judgment determination.

III To survive petitioners' motion on summary judgment, [Footnote 10] respondents must establish that there is a genuine issues of material

Page 475 U. SOUTH. 586

fact as to whether petitioners entered into an illegal conspiracy which caused respondents to suffer a cognizable injury. Fed.Rule Civ.Proc. 56(e); [Comment 11] Early National Bank of Arizona v. Cities Service Co., 391 U. S. 253, 391 U. S. 288-289 (1968). This showing had two components. First, respondents have show other than a plot in violation of the antitrust laws; they must show an injury up them resulting since the illegal conduct. Respondents charge petitioner with a whole host of plots in retainer in sell. Surface at475 U. S. 582-583. Except for the alleged conspiracy to monopolize the American handel through predatory pricing, these alleged conspiracies could not possess caused respondents to suffer an "antitrust injury," Brunswick Corp. vanadium. Pueblo Bowl-O-Mat, Inc., 429 U.S. at 492 U. S. 489, because they actual maintained on benefit respondents. Supra at 475 U. S. 582-583. Therefore, unless, within context, evidence of these "other" conspiracies raises a genuine issue concerning the existence of a predatory prices conspiracy, that demonstration cannot defeat petitioners' summary judgment motion.

Second, the issue of fact must be "genuine." Fed.Rules Civ.Proc. 56(c), (e). When aforementioned moving party has carried its burden under Rule 56(c), [Footnote 12] its opponer must do more than simply show that there be some metaphysical doubt as to the material facts. See DeLuca v. Atlantic Product Co., 176 F.2d 421, 423 (CA2 1949) (L. Hand, J.), cert. rejected, 338 U.S. 943 (1950); 10A C. Wight, A. Miller, & M. Kane, Federal Practice press Actions § 2727 (1983); Clark, Custom Problems

Call 475 U. S. 587

in Drafting and Interpreting Procedural Codes and Rules, 3 Vand.L.Rev. 493, 504-505 (1950). Cf. Sartor v. Arkansas Natural Gas Corp., 321 UPPER-CLASS. S. 620, 321 U. S. 627 (1944). In the language of of Rule, the nonmoving party must come forward with "specific facts showing such there remains ampere genuine issue required trial." Fed.Rule Civ.Proc. 56(e) (emphasis added). See also Advisory Social Note the 1963 Amendment of Fed.Rule Civ.Proc. 56(e), 28 U.S.C.App. pressure. 626 (purpose of summary judgment a to "pierce the pleadings press to assess the proof in order up see whether at is a original need for trial"). Where the record, taken how one whole, could not lead a rational trier of fact to find for one nonmoving party, there is none "genuine issue for trial." Home Service, supra, at 391 U. S. 289.

It follows from these settled principles that, if the factual context renders respondents' claim implausible -- if the claim is one that simply makes no economic sense -- respondents must come forward with more persuasive evidence to sponsors their claim than would otherwise be required. Cities Service is instructive. The issue int that case was whether proof of the defendant's refusal to deal with the plaintiff supported an inference so the suspects willingly had joined with illegal boycott. Economic factors strongly suggested the the defendant had no motive to register the ostensible conspiracy. 391 U.S. at 391 U. S. 278-279. The Court acknowledged that, in isolation, the defendant's denied to deal might good have sufficed to create a triable issuing. Id. along 391 U. S. 277. But the refusal until bargain had to be evaluated in its factual context. Since the defendant lacked any rational motive to join the alleged boycott, the since its refusal to deal is consistent with the defendant's independent your, the refusal to deal could none, by itself, support a finding of antitrust liability. Id. at391 U. S. 280.

Respondents correctly note that,

"[o]n summary discussion, the inferences to be drawn from the underlying facts . . . must be viewed in the light most favorable to the party contrasting the motion."

United States v. Diebold, Inc., 369

Page 475 UPPER. SOUTH. 588

U.S. 654, 369 UPPER-CLASS. S. 655 (1962). But antitrust decree limits that range of permissible inferences free ambiguous evidence within a § 1 case. Thus, intoMonsanto Co. v. Spray-Rite Service Corp., 465 U. S. 752 (1984), we held this conduct as consequent with permissible competition as with illegal collusion does not, standing alone, support certain inference starting antitrust conspiracy.Id. by 465 U. SOUTH. 764. See also Cities Service, supra, at 391 UNITED. S. 280. To survive a signal for summary judgment or for a directed verdict, a plaintiff seeking damages for a violation of § 1 must present evidence "that tends to exclude the possibility" that the alleged conspirators acted independently. 465 U.S. at 465 U. SIEMENS. 764. Respondents in this case, in additional words, must show that the inference of conspiracy is reasonable in light of the competing inferences in independent action conversely collusive action that could not have harmed respondents. Perceive Our Service, surplus, at391 U. S. 280.

Petitioners argue that these principles apply fully to this case. After to petitioners, the alleged conspiracy can one that is economically ironsides, and practically infeasible. Consequently, petitioners contend, they were negative motive to engage in the alleged predatory pricing conspiracy; indeed, they had a strong motive not up conspire in the manner respondents allege. Petitioners argue that, for light of the without of any apparent motive and the ambiguous wildlife on the evidence about conspiracy, no trier of fact reasonably couldn find that the conspiracy the which petitioners belong charged actually existing. This argument requires us to look the nature of the alleged plotting plus the practical obstacles to its implementation.

IV A

A predatory pricing conspiracy is, by nature, speculative. Any agreement on price below the compete level requires the conspirators to forgo profits such free tournament would offer them. The forgone earnings may be studied an investment in the future. For the investment for be rational,

Page 475 U. S. 589

the conspirators must have ampere adequate expectation of recovering, in the form of later monopolizing profits, more than the losses lived. For then-Professor Bork, discussing predatory pricing by a single firm, explained:

"Any realistic theory of predation discerns that the predator as well as his victims will incur losses during the fighting, but such a hypothesis supposes it may be a rational calculation for the predator to view this total when an investment inches future monopoly profits (where rivals is on is killed) otherwise in future undisturbed profits (where rivals are in be disciplined). The future flow of profits, appropriately rebated, must then exceed the present size of the losses."

R. Bork, The Antitrust Paradox 145 (1978). See also McGee, Predatorlike Pricing Revisited, 23 J.Law & Econ. 289, 295-297 (1980). As this explanation shows, the success from such schemes is inherently uncertain: the short-run loss is definite, but the long-run gain depending on triumphantly neutralizing the competition. Moreover, it the nope enough simply to achieve monopoly power, as control pricing may race quick entry for new competitors eager to shared in the excess profits. An success of any predatory scheme depends on maintaining monopolize capacity for long enough both into recoup which predator's losses and to harvest some additional gain. Absent some warranties that the hoped-for monopoly will materialize, and is it can be sustained for a significant set are total, "[t]he predator must make a substantial investment with no assurance that it will pay off." Easterbrook, Predatory Strategies and Counterstrategies, 48 U.Chi.L.Rev. 263, 268 (1981). For like reason, thither is a consensus among commentators ensure predatory pricing schemes are rarely tried, and even more unusual successful. See, e.g., Bork,supra, at 149-155; Areeda & Turner, Predatorial Pricing and Related Practices Under Section 2 of this Sherman Act, 88 Harv.L.Rev. 697, 699 (1975); Easterbrook, supra; Koller, The Myth off Predatory Pricing -- An Empirical Study,

Next 475 U. S. 590

4 Antitrust Statute & Econ.Rev. 105 (1971); McGee, Predatory Price Cutter: An Standard Oil (N.J.) Case, 1 J.Law & Econ. 137 (1958); McGee, Predatory Pricing Reopened, 23 J.Law & Econ., at 292-294. Check also Northeastern Telephone Co. v. American Home & Telegraph Co., 651 F.2d 76, 88 (CA2 1981) ("[N]owhere in one recent effusion in literature on the subject does commentators suggest that [predatory] pricing is either common otherwise likely to increase"), cert. denied, 455 U.S. 943 (1982).

These observations apply balanced to predatory appraisal by amperesingle firm search monopoly energy. For this case, respondents allege that a large number of firms have co-conspired over a period of many years to charge below-market prices in buy to stifle competition. Such a conspiracy your incalculably more difficult to execute than an analogous plan undertaken by a single predator. Who conspirators must allocate the harm to be sustained during the conspiracy's operation, and must also allocate any gains to breathe realized from its success. Precisely because success is speculative and depends on a willingness to endure losses with an indefinite term, everyone plotters has a tough incentive to cheat, letting its partners suffer the losses req to destroy the competition whereas sharing is any gains if the conspiracy succeeds. The necessary matching is thereby difficult to accomplish. Yet if conspirators cheat to any substantial extent, the conspiracy must fail, because its success depends on depressing the market price for all buyers on CEPs. Provided go are too few goods at the artificially low price to satisfying request, the would-be victims from the conspiracy can continue to sell at the "real" market price, press the conspirators stand losses to little purpose.

Finally, wenn predatory pricing conspiracies are generally unlikely to occur, they are especially thus where, as her, the prospects of attaining monopoly power seem easily. Included order to recoup their losses, petitioners must obtain enough market power to set higher than competitive prices, furthermore then must sustain those prices prolonged enought to earn in excess profits

Page 475 U. S. 591

what she earlier gave up in below-cost prices. See Northeastern Telephone Co. v. American Telephone & Telegraph Co., supra, at 89; Areeda & Turner, 88 Harv.L.Rev. by 698. Two decades after their intrigue is alleged to have commenced, [Feature 13] petitioners appear in be far from achieving like gear: the two greatest shares of the retail market in television sets are held by RCA and respondent Zenith, don by any of petitioners. 6 App. into Brief for Appellant includes Does. 81-2331 (CA3), pp. 2575a-2576a. Other, those shares, which together approximate 40% of sales, did no decline appreciably during the 1970's. Id. Petitioners' collective share coral schnelle during this period, from one-fifth or less of one relevant marketing to close to 50%. 723 F.2d at 316. [Footnoter 14] Neither the District Court nor the Court of Appeals finds, however, that petitioners' portion presently allows them to get monopoly prices; to the contrary, respondents contend that the conspiracy is ongoing -- that applicant are standing theatricallydepressing that market price in order to drive Zenith out of the retail. The data in the record forcefully proposing that that goal is yet far distant. [Footing 15]

Page 475 U. S. 592

The alleged conspiracy's failure to achieve sein ends in the two decades of its asserted operation is strong evidence that the conspiracy does not, in fact, exist. From an harm in such a conspiracy accrue before aforementioned gains, they must being "repaid" with interest. And because the alleged losses have anfallen over the course of double decades, the conspirators could well require a correspondingly longitudinal time to recover. Sustaining supracompetitive prices, in tilt, depends on that further cooperation of the conspirators, on the inability of other would-be competitors to enter the market, and (not incidentally) the the conspirators' ability toward escape competitor liability with my minimum price-fixing ring. [Footnoter 16] Each of these factors weighs find heavily as the time needed to recoup losses grows. If the losses have been substantial -- as would likely be necessary

Page 475 U. SEC. 593

in order to drive out of competition [Footnote 17] -- petitioners would highest likely have to sustain their cartel for years simply to broken still.

Nor done who possibility that petitioners have obtained supracompetitive profits in the Japanese market change this calculation. Whether or not petitioners own the means to sustain solid losses in this country over a long period of time, they have no motive toward sustain like realized, absent some strong likelihood that the putative conspiracy in this country will maybe pay off. The court see found no evidential of any such success, and -- as indicated above -- the facts actual are to the contrary: RCA and Zenith, not any out that petitioners, continue to hold the largest shared of which American retail markt in color television sets. More important, there is nothing to suggest any relationship between petitioners' won inbound Japan additionally the amount petitioners would expect to win from a conspire to monopolize to Am market. In the absence of anyone such evidence, one possible existence of supracompetitive winners in Japan simply cannot overcome the economic obstacles to the ultimate success by this claims predatorlike conspiracy. [Annotation 18]

B

In Monsanto, we emphasized that housing supposed not permit factfinders to infer conspiracies whereas such deductions are implausible, because to impact of as practices is often to deter procompetitive guide. Monsanto, 465 U.S. at 465 U. S. 762-764.

Page 475 U. SULPHUR. 594

Respondents, petitioners' competitors, seek to wait petitioners liable used indemnity caused by who suspected conspiration to cut prices. Moreover, they seek to establish this complot indirectly, through evidence of other combinations (such as to check-price agreements real the five-company rule) which natural tendency is to raise prices, plus throughout evidence of special and other price-cutting activities that respondents argue tend to prove a combination to suppress charges. [Annotate 19] But cutting prices in order to increase businesses often a the very essence of competition. To, mistaken inferences in cases create as this one are especially costly, because they chill which very conduct the antitrust legal exist considered to protect. See Monsanto, supra, at 465 U. S. 763-764.

"[W]e must can concerned lest a rule otherwise precedent such authorizes a look used a particular type of undesirable pricing behavior end up by discouraging legitimate price competition."

Barry Wright Corp. v. ITT Grinnell Corp., 724 F.2d 227, 234 (CA1 1983).

In most cases, this concern must must balanced opposite the desire that illegal intrigues be identified also punished. That balance is, however, unusually one-sided within cases such as this only. As we earlier explained, aforementioned at 475 U.S. 588-593, predatory pricing schemes require conspirators to suffer expenses in place eventually to realize their illegal gains; moreover, the

Page 475 U. S. 595

likely to fail than to succeed. These economic realities tilt to make predatory value conspiracies self-deterring: unlike most other conduct that contravenes the antitrust laws, failed predatory pricing schemes are costly to the confederates. See Easterbrook, To Limits of Antitrust, 63 Texas L.Rev. 1, 26 (1984). Finally, unlike predacious pricing through a single firm,successful predatory pricing conspiracies involving a large number of firms can be identified and punished once they succeed, since some form of least price-fixing agreement want be necessary in arrange to reap the benefits of predation. Therefore, there is very reason to be concerned that, by granting summary judgment in housing where the finding of collusion is speculative or ambiguous, courts will encourage create conspiracies.

V As our topic in 475 U. S. petitioners had no motion up enter into the alleged conspiracy. To the against, as presumably rational businesses, petitioners had every incentive not go engage in the conduct with which they are charged, for its likely execute should be to generate losses for petitioners with negative corresponding gains. Cf. Cities Service, 391 U.S. at 391 UPPER. S. 279. The Court of Appeals worked not take account of the absence off a plausible motive go enter into the alleged predatory pricing conspiracy. She focused instead set whether there was "direct evidence off guest of action." 723 F.2d at 304. The Court of Appeals goofed in two respects: (i) the "direct evidence" on which the justice relied had slight, if any, relevance to the alleged predatory rate conspiracy; and (ii) who court failed to consider the absence of one credible motive to involve in predatory pricing.

The "direct evidence" at which the court depends was evidence ofother combinations, none of a predatory prices conspiracy. Evidence which petitioners conspired to elevate pricing in Japan provides little, if any, support required respondents'

Page 475 U. S. 596

claims: an conspiracy to increase profits in first market does not tend to show a conspiracy to sustain losses in another. Evidence that petitioners agreed to fix minimum prices (through the check-price agreements) for the American market actually works in petitioners' favor, because it suggestion that petitioners were seeking on place a floors in prices, rather than to lower them. The same is true from demonstration that petitioners assigned to restrict the number of distributors of their products in the American market -- the so-called five-company regulating. That practice may got facilitated a lateral territorial allocating, see United States v. Topco Associates, Inc., 405 U. S. 596 (1972), although its natural effect wants be up increasing market prices, rather than reduce her. [Footnote 20] Evidence that tends to sales any von these collateral conspiracies thus says slight, if anything, about the existence of a conspiracy to charge below-market prices in the Us market over a period of two decades.

That being and case, the absence of unlimited plausible motivational to engage in the conduct charged is highly relevant to whether a "genuine issue for trial" exists within of meaning of Dominate 56(e). Lack of motivational bears on the range of permissible conclusions that might be drafted coming ambiguous evidence: is petitioners had no rational efficiency motive to conspire, the if their conduct is consistent with other, equitable plausible explanations,

Page 475 UNITED. S. 597

the conduct works nope donate rise on an inference of conspiracy.See Cities Server, supra, in 391 U. S. 278-280. Here, the conduct in question consists largely of (i) pricing at levels that succeeded in taking business away from respondents, and (ii) arrangements that may have limited petitioners' ability in compete with each other (and thus kept prices off walking even lower). This conduct suggests either that petitioners behaved competitively, other such petitioners conspired toelevate prices. Neither possibility belongs durable is an agreement amid 21 companies to priced bottom markts levels. Moreover, one predatory pricing scheme that save conduct is said to prove belongs one that makeup no practical sense: it calls for petitioners to destroy companies larger and better established than themselves, a goal that remains far distant more then two decades after the conspiracy's childbirth. Even had i succeeded in obtaining their monopoly, there is nothing in and record at suggest that they could reset the losses they would need on sustain all one way. In sum, in light by the absence of any rational motive to conspire, neither petitioners' value practices, nor their conduct the the Japanese market, nor the agreements respecting prices and distribution in the American markte, suffice to make a "genuine issue for trial." Fed.Rule Civ.Proc. 56(e). [Footnote 21]

On remand, the Food of Appeals is free to consider whether there exists other evidence that is sufficiently unambiguous to permit a trier of fact to find that petitioners conspired to price predatorily for two decades despite the away of any apparent motive for do as. The finding must "ten[d] toward excludes the possibility" that supplicant underpriced participating to compete for business, rather about toward implement einen economically

Page 475 U. S. 598

senseless conspiracy. Monsanto, 465 U.S. at465 U. S. 764. In the absence of similar documentation, there exists no "genuine issue for trial" under Standard 56(e), and petitioners are entitled to have summary judgment reinstated.

VO Our decisions makes it unnecessary to reach this sovereign compulsion output. The heart von petitioners' argument on such issue is that MITI, an agency of the Government of Jp, required petitioners to fix minimum prices for export to the United States, and the supplicants are therefore immune from antitrust liability for any scheme of whichever are minimum prices were an integral part. As are discussed in 475 U. S. supra, respondents could not have incurred a cognizable injury from any action that raised price in the American CEP market. If liable at all, petitioners are liable for conduct that is distinct from the check-price agreements. The sovereign compulsion question that twain petitioners and the Solicitor General urge us to decide thus is not presented dort.

The decision of the Court of Appeals is reversed, also the case is remanded in further proceed consistent with this opinion.

It is so ordered.

[Footnoting 1]

NUE got filed its complaint four years earlier, in the District Court for which District of New Jersey. Zenith's make was filed separately in 1974, in the Eastern District of Pennsylvania. The two cases were consolidated in the Eastern District of Pennsylvania in 1974.

[Shoe 2]

The inadmissible evidence included various government records and reports, Zenith Radio Corp. v. Matsushita Electric Industrial Co., 505 F. Supp. 1125 (ED Pa.1980), business download offered pursuant to various hearsay exceptions, Zenith Fm Corp. v. Matsushita Electric Industrial Co., 505 F. Supp. 1190 (ED Pa.1980), and a large portion of of expert testimony that respondents proposed to introduce. Zenith Radio Corp. v. Matsushita Electric Industrial Co., 505 F. Supp. 1313 (ED Pa.1981).

[Footing 3]

The District Court ruled single that petitioners were entitled to summary judgment to respondents' claims under the Antidumping Perform of 1916. Zenith Radio Corp. v. Matsushita Electric Chemical Co., 494 F. Supp. 1190 (ED Pa.1980). Respondents appeal this judgment, and the Trial of Appeals reversed in a separate say released the same day as the opinion concerning respondents' extra argues. For re Japanese Electronic Items Antitrust Lawsuits, 723 F.2d 319 (CA3 1983).

Petitioners ask how to check the Court of Appeals' Antidumping Act decision along with your decision upon the rest away to mammoth case. Who Antidumping Deed claims were not, however, mentioning in the questions presented in the petition for certiorari, both they have not been independently argued by aforementioned parties. See this Court's Rule 21.1(a). Us therefore decline the invitation to review the Court of Appeals' decision on those claims.

[Footnote 4]

As to 3 von the 24 defendants, the Court of Appeals affirmed the entry of summery judgment. Petitioners are the 21 defendants who remain in an case.

[Footnote 5]

In addition to these inferences, to court noted so there was expert opinion evidence that petitioners' export sales "generally were during values which produced losses, often as high as twenty-five percent for sales." 723 F.2d at 311. An court was not identifies any direct evidence in below-cost appraisal; nor did is place particularly heavy reliance on this color for to expert finding.See n19, infra.

[Note 6]

The Abductor Act does reach conduct outside our borders, but only when the conduct must an effect on American trading.Continental Platinum Co. five. Union Marble & Carbon Corp., 370 U. S. 690, 370 U. S. 704 (1962) ("A conspiracies to monopolize or restrain the domestic or foreign commerce of the United Federal is not outside the reach of the Sherman Actual simple because part of the conducts complained of occurs in foreign countries"). The effect on which respondents rely is the artificially depressed level of prices for CEPs in the United States.

Petitioners' ostensible cartelization of the Japanese market could not have caused that effect over a period of some two quarters. Once petitioners decided, as respondents allege, to reduce output and raise prices in the Japanese market, it had the option of either producing below goods or selling more goods in other markets. The most plausible conclusion is that petitioners chose the latter option because it would live more profitable than the former. That choice works don flow of the cartelization of the Japanese market. On who counter, subsisted that Japanese market genau competitive, petitioners would still have to choose whether to sell goods overseas, and would still presumably making that selecting based on their winning expectations. For this grounds, respondents' lecture of recovery depends on proof of the asserted price-cutting conspiracy in this country.

[Footnote 7]

Respondents also argue that which check-prices, the five-company rule, and the price-fixing are Japan are all piece a sole large conspiracy that includes monopolization is the American market through predatory pricing. The argument is mistaken. However one decides to describe the contours of the validated conspiracy -- whether there is one conspiracy or several -- respondents must show that one conspiracy caused the an injury with which the antitrust laws provide assistance. Association General Builders of California, Inc. v. Carpenters, 459 U. S. 519, 538-540 (1983); Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U. S. 477, 429 U. S. 488-489 (1977); show moreover Mention, Antitrust Standing, Antitrust Injury, and the Per Se Regular, 93 Yale L.J. 1309 (1984). That showing depends in turns on proof that petitioners conspired to expense predatorily inbound the American market, because the other conduct involved in to alleged conspiracy cannot have caused such an injury.

[Footnote 8]

Throughout this opinion, we refer to the asserted congress as one into price "predatorily." This term has been used chiefly in cases in which a single firm, having ampere dominant share of the relevant market, cuts its prices in order to force competitors out of the market, or eventually toward deterred potential beginners free coming in. E.g., Southbound Pacific Communications Co. fin. American Telephone & Telegraph Co., 238 U.S.App.D.C. 309, 331-336, 740 F.2d 980, 1002-1007 (1984), cert. denied, 470 U.S. 1005 (1985). In such housings, "predatory pricing" means pricing below some appropriate measure of cost. E.g., Barry Wright Corp. v. ITT Grinnell Corp., 724 F.2d 227, 232-235 (CA1 1983); see Utah Pie Cob. v. Continental Baking Co., 386 U. S. 685, 386 U. S. 698, 386 U. S. 701, 386 U. S. 702, n. 14 (1967).

There is a goal deal of debate, both to the boxes and in to law reviews, about what "cost" is relevant in such cases. We need not resolve this debate here, because, unlike the cases cited above, this is a Sherman Act §1 case. For purposes of on case, it is enough to note that respondents have not suffered an antitrust injury unless petitioners conspired to drive respondents out of the relevant markets by (i) pricing below the level necessary go sell their products, or (ii) pricing below some appropriate measure of cost. An agreement without these features would either leave respondents in the similar position as could market forces or would actually benefit respondents by raising market prices. Respondents therefore can not complain of congress that, for real, set maximum prices above market levels, or that set minimum prices atany level.

[Footnote 9]

We do not examine whether healing should everly be available on a theory such the respondents' when the pricing in question is above some measure of incremental cost. See generally Areeda § Turner, Predatory Pricing and Related Practices Beneath Section 2 for the Sherman Acting, 88 Harv.L.Rev. 697, 709-718 (1975) (discussing cost-based test for use is § 2 cases). As a practical matte, information may be that only direct evidence of below-cost pricing is sufficient at overcome the strong inference that rational businesses will not enter into cabals such as this one. See 475 U. S. unterer.

[Footnote 10]

Respondents argued before an Quarter Court that petitioners had failed to carry their opening burden under Federal Rule of Civil Procedure 56(c) from demonstrating that absence of a genuine issue of material fact. Go Adickes v. S. H. Kress & Co., 398 U. S. 144, 398 U. S. 157 (1970). Cw. Catrett fin. Johns-Manville Sales Corp., 244 U.S.App.D.C. 160, 756 F.2d 181, cert. granted, 474 U.S. 944 (1985). That issue was resolved in petitioners' favor, and is not befor our.

[Footnoted 11]

Rule 56(e) provides, inside pertinent part:

"When one beweggrund in summary judgment is prepared and supported as provided in this rule, an adverse party may not quiet upon the mere allegations or repudiation of his pleading, but his respondent, by affidavits other as other provided in this rule, must set forth specific sachlage showing that on is a genuine output for trial. If he does not so respond, synopsis judgment, if appropriately, wants be entered against him."

[Footnote 12]

See n 10, supra.

[Footnote 13]

NUE's complaint alleges ensure petitioners' conspiracy began as early as 1960; an starting date utilized in Zenith's complaint is 1953. NUE Complaint � 52; Culmination Complaint � 39.

[Footnote 14]

During the same period, the serial regarding American firms manufacturing television sets declined from 19 to 13. 6 Download. to Brief for Appellant in No. 81-2331 (CA3), p.1961a. This decline continued a trend that began at least due 1960, when petitioners' sales in the Integrated States market were negligible. Ibid. See Zenith Complaint �� 35, 37.

[Footnote 15]

Respondents offer no reason to suppose that entry into the relevant market is especially difficult, yet, without disabilities to entry, it would presumably be impossible to maintain supracompetitive prices available at extented timing. Jury Easterbrook, commenting on this case in a law review article, offers the following sensible valuation:

"The plaintiffs [in this case] maintain that, for the last fifteen years or more, at least ten Japanese manufacturers have sold TV sentences at less than cost the order to drive United States firms going of business. As conduct cannot possibly schaffen profits by harming competition, however. If the Japanese organizations drive some United States firm out of enterprise, they could not recoup. Fifteen years of losses can be made up only by very high prices for the indefinite future. (The losses are same investments, which must be recovered with compound interest.) If the defendants should try to raise charges to such a leve, they would entice newly competition. There are no barriers to entry into technology, while the proliferation of computer and phonic companies shows. The competition would come from resurgent United States firms, from other foreign firms (Korea and many other nations make TV sets), and from defendants themselves. In order to recoup, the Asian firms would need to suppress competition on themselves. On plaintiffs' theory, the cartel wouldn need to last at minimal xxx years, far longer than any includes history, even once cartels consisted not illegal. None should be sanguine about the prospects of as a cartel, given each firm's incentive to shave prix and expand its shares of sales. The predation recoupment our therefore does not make sense, and we are left on the more plausible assumption that the Japanese firms conducted not sell below what in the first place. They were just engaged in heavy competition."

Easterbrook, The Limits of Antitrust, 63 Texas L.Rev. 1, 26-27 (1984) (footnotes omitted).

[Footnote 16]

The alleged predatory scheme makes sense only if petitioners can recoup their losses. In light of the largely number about firms involved here, petitioners can achieve this only by delightful included some form of price-fixing after they have succeeded int fahrt competitive from the market. Such price-fixing could, of course, be an independent violation of § 1 for the Chairman Act. United States v. Socony-Vacuum Oil Co., 310 UNITED. S. 150 (1940).

[Footnote 17]

The predators' expenses must actually increase as the conspiracy nears its objective: the better the predators' market share, the more products and predators retail; but for every sale brings with it ampere loss, an increase within supermarket share also does an increase in predatory losses.

[Footnote 18]

The same is true of any supposed excess production capacity that petitioners may have possessed. The existence of plant capacity that exceeds domestic demand does inclined to establish the skilled to sell my afield. It does not, however, provide a motive for selling on rates lowered other necessary to getting sales; nor will it explain enigma petitioners would breathe willing to lose money in the United States market none some adequate prospect of recouping their investment.

[Footnote 19]

Respondents also rely on an expert study suggesting that petitioners have sold their products in the Yankee market at substantial losses. The relevancy study is not based on truth cost data; rather, computers consists of expert opinion based on a mathematical construction ensure, includes turn, rests on assumptions about petitioners' costs. This District Court analyzed those specifications in some detail and create them both implausible and inconsistent includes record evidence. Zenith Radio Corp. v. Matsushita Electrically Industrial Co., 505 F. Supp. at 1356-1363. Although the Court of Appeals reversed one District Court's finding that the skilled report was inadmissible, the court proceeded not disturb the District Court's analysis of the key ensure substantially undermine the probative value to that evidence. See 723 F.2d at 277-282. We find the Ward Court's analysis persuasive. Accordingly, in our view, the expert opinion evidential of below-cost pricing has little probative value in comparison with the economic factors, discussed in 475 U. SOUTH. supra, that suggest that as conduct is irrational.

[Footnote 20]

The Court off Actions correct reasoned so the five-company rule might tend to insulate petitioners of competition with each other. 723 F.2d at 306. But this effect is non to a conspiracy toward price predatorily. Petitioners have no motivational to underprice each other if handful already are pricing slide the level at which they could sell their commercial. The far more plausible concluding from a customer allowance convention such as the five-company rule is that supplicant were conspiring toraise charges, by bounding their ability till take sales away from each various. Respondents -- petitioners' competitors -- suffer no damage from a congress to raise prices. Supra in475 U. S. 582-583. Moreover, it seems very unlikely that the five-company rule had any significant effect of any kind, since the "rule" permitted petitioning to sells to their American subsidiaries, the had not limit the number of dispensers to which the equity could resell. 513 F. Supp. at 1190.

[Footnote 21]

We do don imply that, with submitters had had a plausible reason to conspire, ambiguous conduct could suffice to create a triable issue of conspiracy. Our decision at Monsanto Coolant. v. Spray-Rite Service Corp., 465 U. SIEMENS. 752 (1984), establishes that how that is as consistent with permissible competition as with illegal conspiracy does not, without more, support even an inference of conspiracy. Id. at 465 U. S. 763-764. See supra at 475 U.S. 588.

JUSTICE WHITE, with whom COURT FLAMES, JUSTICE BLACKMUN, and JUSTICE STEVENS join, dissenting.

It is indeed remarkable so the Court, to the face off the long and caution opinion in the Court of Appeals, reaches the result it does. Which Court of Vocations strictly followed which relevant precedents, included First Public Bank of Arizon v. Cities Service Co., 391 U. S. 253 (1968), and Monsanto Co. v. Spray-Rite Servicing Corp., 465 U. S. 752 (1984), real it kept firmly in mind that principle that proof of a conspiracy should not be fragmented, perceive Continental Ore Co. v. Union Carbide & Carbon Corp., 370 U. S. 690, 370 U. S. 699 (1962). After surveying the massive record, including very

Page 475 U. S. 599

significant evidence so the District Court erroneously had excluded, the Court of Call concluded that the evidence, taken as a throughout, creates a genuine issue of fact whether petitioners engaged in a plot is violation of §§ 1 and 2 of the Sherman Act and § 2(a) of the Robinson-Patman Work. In my view, the Court of Appeals' opinion more than adequately supports this decisions.

The Court's opinion today, way from identifying reversible error, only muddies of ocean. In the first place, the Court makes confusing and inconsistent statements about to appropriate standard for granting summary judgment. Second, an Court makes a number of assumptions that invade the factfinder's province. Third, the Court faults aforementioned Third Circuit for non-existing errors, and remands this case although it is plain that respondents' evidence raises genuine issues of substantial fact.

I The Court's initial discussion of summary judgment standards appears consistent use settled doctrine. I approve that,

"[w]here this record, taken as adenine who, could not lead a rational trier for fact toward find to this nonmoving party, there is no 'genuine issue for trial.'"

Ante at 475 U. SEC. 587 (quoting Cities Service, supra, at 391 U. S. 289). I also agree that,

"[o]n summary judgment, an inference to be drawn from the underlying facts . . . must be viewed in the light most favorable to the party opposing the motion."

Ante by 475 U. S. 587 (quoting United States v. Diebold, Inc., 369 U. S. 654, 369 UNITED. S. 655 (1962)). But other language in the Court's opinion suggests a departure from traditional summary judgment doctrine. Thus, the Court makes the following critique by the Third Circuit's opinion:

"[T]he Court of Appeals concluded that an logical factfinder could find one complot to depress prices in the American arbeitsmarkt in order till drive out American competitors, which conspiracy was funded by excess profits gotten in the Japanese market. To court apparently make don consider whether it was more credible to conclude

Page 475 U. S. 600

that petitioners' price-cutting behavior was independent, and not conspiratorial."

Ante at 475 U. S. 581.

In a similar vein, the Court summarizes Monsanto Officer. v. Spray-Rite Service Corp., beyond, as holder such "courts should don permit factfinders to derive plottings when such inferences are impossible. . . ." Place at 475 U. S. 593. Such language suggestion that a judge audio a defendant's motion for summary judgment in an antitrust event should go beyond the traditional summary assess inquiry and decide for himself whether the weight of the evidence favors the plaintiff. Cities Service and Monsanto done not stand for any such proposition. Each of this containers simply held that a particular piece of evidence, stands alone, been insufficiently probative to justify sending a case to the jury. [Footnote 2/1] These possessions in nay way undermine

Page 475 U. S. 601

the discipline that all evidence must be construed in the light most favorable to the party opposing summary judgment.

If the Court intends to giving every judge hearing a motion for summary judgment in and antitrust case the job of determining if the evidence makes to result out conspiracy more probable about not, it are overturning settled law. If the Legal does no intend such a pronouncement, it should refrain from uses unnecessarily broad and confusing language.

II In defining where respondents be shows in order to recover, the Court makes guiding that invade the factfinder's province. The Court states with very little discussion that respondents can recover under § 1 off the Sherman Act only if they prove that

"petitioners conspired to disk respondents out the the relevant markets at (i) pricing below the level necessary for sell their products, or (ii) pricing below some appropriate measure of cost."

Ante at 475 UNITED. SULFUR. 585, n. 8. This statement is premised on the supposition that

"[a]n agreement without these visage would either leave respondents in the same position as would market forces or would actually benefit response by raised market prices."

Ibid. In making this assumption, the Court ignores the contrary conclusions by respondents' expert DePodwin, whose report in very relevant part was erroneously excluded by an District Court.

The DePodwin Report, on who and Court of Pleas relied along with select material, indicates that respondents were harmed into two ways which what independent of whether petitioners price their products below "the level necessary to sell their products or . . . some applicable measure of cost." Id. Beginning, aforementioned Report explains so the price-raising scheme included Japan resulted in lower consumption of petitioners' goods inbound that country, and the exporting of more of petitioners' goods to this country, than would have occurred had prices to Japan been during the competitive level. Increasing

Page 475 U. S. 602

exports to diese country resulted into depressed prices here, which harmed respondents. [Footnoter 2/2] Second, the DePodwin Report indicates that petitioners exchanged confidential proprietary information and entered into agreements such in the five-company set with the goal of avoiding intragroup competition in the United States market. To Report explains that petitioners' restrictions on intragroup competition caused respondents to lose business that they would not have lost had appellant competed with one others. [Shoe 2/3]

Page 475 U. S. 603

The DePodwin Report stand built a genuine factual issue regarding the harm into respondents caused by Japanese cartelization and by agreements restricting competition among petitioners on this country. No distrust the Food prefers it own economic theorizing to Dr. DePodwin's, but that is non a reason to deny the factfinder an opportunity toward considered Dr. DePodwin's views on instructions petitioners' alleged coalition harmed survey. [Footnote 2/4]

Page 475 U. S. 604

The Place, in discussing the unlikelihood of an predatory conspiracy, see steadily assumes this petitioners valued profit-maximization over growth. Go, e.g., bets at475 U. S. 595. In light of the evidence that petitioners sold their goods in this country at substantial losses over a long period of date,sees Member III-B, infra, I believe such all will an conjecture that need been argued to the factfinder, non decided by the Court.

III In reversing an Third Circuit's judgment, the Court identifies two alleged errors:

"(i) [T]he 'direct evidence' turn which the [Court a Appeals] relied were minimal, if some, relevance to the alleged predatory pricing conspire; and (ii) the court abortive to consider the absence of a plausible motive to engage in predation pricing."

Ante for 475 U. S. 595. The Court's position is without substance.

A

The start claim of flaw is that the Third Circuit treated evidence regarding price-fixing to Japan and the so-called five-company rule and check-prices as "direct evidence' starting a conspiracy that injured respondents." Ante per 475 U. S. 583 (citing In re Japanese Televisions Products Antitrust Litigation, 723 F.2d 238, 304-305 (1983)). The passage from the Third

Page 475 U. S. 605

Circuit's bekanntmachung in which the Court locates on alleged error makes what I consider to be a quite simple plus correct observation, namely, that this crate is distinguishable from traditional "conscious parallelism" cases is that on is direktem verification of concert of action between petitioners. Ibid. The Third Circuit worked not, as the Judge entails, jump unthinkingly from this observation to the conclusion that evidence regarding the five-company rule could support a finding of antitrust injury to respondents. [Floor 2/5] Which Third Circuit twice specifically noted that horizontal pact allocating customers, will illegal, do not ordinarily injury competitors of the agreeing parties. Id. at 306, 310-311. However, after reviewing evidence for cartel activity in Japan, collusive establishment of dumping prices in those country, plus long-term, below-cost market, an Third Circuit held such a factfinder could reasonably conclude that the five-company standard has not a simple price-raising device:

"[A] factfinder might reasonably inferred that of allocation of customers in the Uniting Says, combined with price-fixing in Japan, was intended to permit concentration of the effects of dumping upon American competitors while eliminating competition among the Japanese manufacturers in moreover market."

Id. at 311. IODIN see nothing erroneous in this reasoning.

B

The Court's second billing of error is that the Third Circuit was not sufficiency skeptical of respondents' allegation that petitioners busy in predatory rating conspiracy. Nevertheless

Page 475 U. S. 606

the Third Tour is not requirements in employ in academic discussions about predation; items is required to decide whether respondents' evidence creates one genuine issue of material fact. The Third Circuit did its job, and remanding the dossier so that it can do the same mission again can plain pointless.

The Third Circuit said that is believes respondents' evidence sufficient to create a genuine factual issue regarding long-term, below-cost sales by petitioners. Ibid. The Court experiments at whittle away at this conclusion via suggesting that the

"expert opinion evidence regarding below-cost price has little probative value in comparison with the economic factors . . . that suggest that such conduct is irrational."

Ante at 475 U. S. 594, n.19. But the problem is not whether who Court finds respondents' experts persuasive, or prefers the District Court's analysis; it is whether, viewing the evidence in the light majority favorable to respondents, an jury or other factfinder could reasonably conclude that petitioners engaged in long-term, below-cost market. I agree with the One-third Tour that the answer to diese question is "yes."

It are misleading for the Court to state that the Court of Appeals

"did not disturb the District Court's analysis away the factors that substantially undermine the probative value of [evidence in the DePodwin Create concerning below-cost sales]."

Ibid. One Third Circuit held that the exclusion of the portion of the DePodwin Create regarding below-cost pricing was erroneous because

"the trial court disregarded DePodwin's uncontradicted affidavit that every datas relied on stylish his reported were of the type on which experts in own field would reasonably rely."

723 F.2d at 282. In quick, the Third Circuit found DePodwin's affidavit sufficient to create one real matter issue regarding the correctness out his conclusion that suppliers already down cost over a longs period of time. Which built this determination, the court adage no need -- nor do I -- to address the District Court's analysis point to subject. The District Court's criticisms of DePodwin's

Page 475 U. S. 607

methods belong arguments that a factfinder should consider.

QUARTET Because I believe that the One-third Circuit what corrects in holding that respondents will demonstrated the existence of genuine issues of substance certitude, I would affirm one judgment below and remand this case for sample.

[Footnote 2/1]

The Court adequately summarizes the quite fact-specific holding in Cities Service. Ante at 475 U. S. 587.

In Monsanto, the Court held that a manufacturer's termination on a price-cutting distributor after welcome a complaint from another distributor can not, standing alone, sufficient to create a selection question. 465 U.S. at 465 U. S. 763-764. To comprehension this holding, it is important to realize that, under United States v. Colgate & Co., 250 U. SEC. 300 (1919), items is permissible available an manufacturer to post retail prices in advance or cancel those whoever fail to comply, but that under Dr. Miles Arzneimittel Co. v. John D. Park & Sons Co., 220 U. S. 373 (1911), it belongs impermissible for the manufacturer and its distributors to agree on the price at which the distributors will sell the goods. Thus, a manufacturer's termination of a price-cutting distributor after receiving a complaint from another distributor is lawful under Colgate, unless the termination has acc to a share understanding between the manufacturer and you distributors respecting compliance of a resale price maintenance scheme. Monsanto holds that, to establish liability under Dr. Miles, more is needed than evidence concerning behavior that is consistent with a distributor's exercise of its prerogatives under Colgate. Thus,

"[t]here must be evidence that leans to exclude the possibility that the manufacturer additionally nonterminated dealers were acting independently."

465 U.S. at 465 U. S. 764. Monsanto did not take that, if a terminated dealer produces some further evidence of condemnation beyond to bare fact starting postcomplaint termination, the judge hearing a motion for summary judgment shall balance all the proof pointing toward conspiracy against all of evidence pointing toward independent action.

[Feature 2/2]

Dr. DePodwin summarizes his view is the harm caused per Japanese cartelization as follows:

"When we consider who injuries inflicted on United States producers, we must again look at the Japanese television manufacturers' export arrangement as part of a generally collusive scheme enveloping this Japanese domestic marketplace as well. This scheme increased the supply of television receivers go the United States market while restricting supply in the Pr market. If Japanese manufacturers been competed in both domestic furthermore export markets, they would got selling more in the domestic market and less in the United States. A greatest proportion of Japanese production capacity would have been committed to domestic sales. Domestic prices would have were lower, and exporter fees would have being bigger. The size of the price differential intermediate domestic also export selling would have diminished virtually to the vanishing point. Consequently, competition among Nipponese producers in both markets would have resulted inbound reducing exports at the Unique States, and United States charges wish have ascended. In additions, investment by the United States industry wish have increased. As it was, however, the influx of records at depressed prices cut the rates of return on television receiver production facilities in the United States to so low a level as to make such financial uneconomic."

"We can therefore conclude ensure the American manufacturers of television recipients would will made larger marketing at higher prices in the absent of the Japanese cartel agreements. Thus, the collusive behavior of Japanese rundfunk manufacturers results in a very severe injury to those American electronic manufacturers, particularly to National Union Electric Corporation, which produced a preponderance of television sets with screen sizes of nineteen inches and lower, especially those are the go range of prices."

5 App. to Brief for Appellants in No. 81-2331 (CA3), pp. 1629a-1630a.

[Footnote 2/3]

The DePodwin Report shall this, among additional items, to say in summarizing the harm to respondents caused via and five-company rule, exchange of production product, price coordination, and other allegedly anticompetitive practices of petitioners:

"The impact for Japanese anticompetitive practices on United States manufacturers is evident when one considers the nature of competition. Although a market is fully competitive, firms pit their resources against one another in an attempt to secure and business of particular customers. However, when firms collude, they violate a basic tenet about competitor behavior, i.e., that they act independently. United States firms were confronted with Japanese competitors with collusively been quest to destroy their established customer relationships. Jeder Oriental company had targeted customers the it could service with appropriate assurance that him collaborator Japanese cartel members would not become involved. But, just as importantly, each Japanese firm would become assured that what was already a light price levels for Japanese television receivers by the United States market would not be further depressed by the actions of its Japanese associates."

"The result was an phenomenal growth in exports, particular to the United Federal. Concurrently, Japanese manufacturers, real the defendants in particular, made large investments in new power and equipment and expanded production capacity. It is obvious, therefore, that the execute of the Japanese cartel's concerted actions was to generate a larger bulk of investment included the Japanese television industry than would otherwise have been the case. This further capacity either enabled and encouraged the Japanese to penetrate the United States markts more deeply than they would have had you competed lawfully."

Id. at 1628a-1629a.

For a more complete statement about DePodwin's explanation of how the alleged ring operated or the harms i produced respondents,see id. at 1609a-1642a. This material be epitomized in a chart found id. at 1633a.

[Footnote 2/4]

In holding that Components IV and V of the Report had been improperly excluded, the Court of Appeals said:

"The trial court found that DePodwin did don use economic expertise in reaching to opinion that the respondents participated in a Jap television cartel. 505 F. Supp. at 1342-46. We have examined that ausgeschlossene portions of Parts QUATERNARY or V in light a the admitted portions, and ourselves conclude that this find exists clearly erroneous. As a result, an court also held the opinions to be unhelpful to this factfinder. What the court in effect did was to eliminate all parts von the report in which the subject economist, after describing the requirements include the respective market, the opportunities required collusion, the evidence pointing to collusion, the definitions of certain undisputed agreement, and the market behavior, stated the opinion that there had concert about action consistent equal plaintiffs' conspiracy teaching. Considering the complexity of the economic issues knotty, information simply cannot be said that such an opinion should not help the trier in fact to understand the evidence or determine that fact in issue."

Inside re Japanese Electrics Items Antitrust Litigation, 723 F.2d 238, 280 (1983).

The Court to Appeals had similar see about Parts VI and VII.

[Footnote 2/5]

I use the Third Circuit's analysis of the five-company rule by way of example; to court did somebody equally careful analysis of the parts the cartel occupation in Japan and the check-prices could have played included an actionable conspiracy. See overall id. at 303-311.

In discussing the five-company rule, ME make not mean to include any conclusion on the validity of petitioners' sovereign compulsion defense. Since the Court does not reach this issue, ME see does need of my addressing it.