Application of Antitrust Principles to Business Tort Claims

As the role of business torts in establishing antitrust
violations has diminished, business tort claims have enjoyed
increasing prominence in their own right. This chapter
examines how business tort defendants have attempted to use
some of the concepts successfully invoked in defense of
antitrust claims when defending against tort claims based upon
competitive conduct. – Eds.
A. Introduction
As defensive theories have proliferated in private antitrust litigation
and business tort claims have grown in popularity,1 business tort
defendants have come to rely upon principles that have been used
successfully to defend against antitrust claims. This chapter focuses
upon two of the most popular – the so-called “competitive privilege” and
the Noerr-Pennington doctrine – and briefly examines several others that
have been used with varying degrees of success in litigation involving
claims of anticompetitive conduct.
B. The Competitive Privilege
As noted in Chapter 1, antitrust plaintiffs in years past attempted
with some success to import business tort principles into antitrust cases.
Today the situation is reversed. As business torts have gained
prominence and antitrust defenses have strengthened, business tort
defendants increasingly have sought to import antitrust concepts into
business tort cases. Foremost among these is the so-called “competitive
1. See Chapter 1.
14 Business Tort Law
Business tort doctrine long has recognized a privilege for conduct
that is legitimately competitive.2 This privilege is embodied in the
formulation of standards concerning tortious interference with business
relations set forth in the Restatement (Second) of Torts,3 and in the more
recent Restatement (Third) of Unfair Competition, which recognizes a
broader “freedom to compete.”4 This more recent Restatement rejects
the view that competition is a “privilege” as to which the defendant has
the burden of proof; instead, it places the burden upon the plaintiff to
allege and prove something other than that the defendant engaged in
mere competition.5
1. General Principles
“One of the most firmly established principles of the common law is
that competition is not a tort.”6 Although competition literally is an
intentional interference with a competitor’s prospective contractual
relations, to conclude that it is therefore tortious would disrupt the
system of free enterprise and thus makes no sense from a legal or
economic standpoint.7
The law of contract exists to provide a means of enforcing business
expectations; however, when a business relation affords the parties no
enforceable expectations, but only the hope of continued benefits, it must
allow for the rights of others,8 since no business has a proprietary interest
2. See, e.g., The Schoolmaster’s Case, Y.B. 11, Hen. IV, f.47 pl. 21 (C.P. Hil.
Term 1410); see also Pac. Express, Inc. v. United Airlines, Inc., 959 F.2d
814, 818-20 (9th Cir. 1992).
5. Id. at cmt. a.
6. Speakers of Sport, Inc. v. ProServ, Inc., 178 F.3d 862, 865 (7th Cir. 1999)
(citing Keeble v. Hickeringill, 103 Eng. Rep. 1127 (K.B. 1706-07)); see
also Frandsen v. Jensen-Sundquist Agency, Inc., 802 F.2d 941, 947 (7th
Cir. 1986)); Grempler v. Multiple Listing Bureau, 266 A.2d 1 (Md. App.
7. ProServ, 178 F.3d at 865; Frandsen, 802 F.2d at 947; see also Macklin v.
Robert Logan Assocs., 639 A.2d 112, 119 (Md. App. 1994).
8. See Bed, Bath & Beyond of La Jolla, Inc. v. La Jolla Vill. Square Venture
Partners, 60 Cal. Rptr. 2d 830, 837-38 (Cal. App. 1997); Belden Corp. v.
InterNorth, 413 N.E.2d 98, 101 (Ill. App. 1980); Macklin, 639 A.2d at 119.
Application of Antitrust Principles 15
in its customers.9 Thus, while a company is not justified in inducing a
breach of contract simply because it is in competition with one of the
parties to the contract and seeks to further the company’s own economic
interests, competitive freedom is of sufficient importance to justify
inducement of a third party to abandon his relationship with another in
the absence of an existing contractual relationship.10
Applying this reasoning, courts generally have held that, while
competition is not a defense to a claim of interference with an existing
contract not terminable at will, it is a valid defense to a claim of
interference with a contract that is terminable at will, or to a claim of
interference with prospective advantage.11 Many of these decisions have
relied upon section 768 of the Restatement (Second) of Torts, which
(1) One who intentionally causes a third person not to enter into a
prospective contractual relation with another who is his
competitor or not to continue an existing contract terminable at
will does not interfere improperly with the other’s relation if
9. See Prudential Ins. Co. of Am. v. Sipula, 776 F.2d 157, 163 (7th Cir.
10. See Macklin, 639 A.2d at 120; Imperial Ice Co. v. Rossier, 112 P.2d 631,
633 (Cal. 1941); Republic Tobacco, L.P. v. N. Atl. Trading Col., 254 F.
Supp. 2d 1007, 1011-12 (N.D. Ill. 2003).
11. See Navellier v. Sletten, 262 F.3d 923, 937-38 (9th Cir. 2001); Int’l Sales
& Serv. v. Austral Insulated Prods., 262 F.3d 1152, 1159 (11th Cir. 2001);
Nobody in Particular Presents, Inc. v. Clear Channel Commc’ns, Inc., No.
01N1523, 2004 U.S. Dist. LEXIS 5665 (D. Colo. April 2, 2004); Cacique,
Inc. v. Gonzalez, No. 03C5430, 2004 U.S. Dist. LEXIS 4966 (N.D. Ill.
March 26, 2004); ProServ, 178 F.3d at 865; Fred Siegel Co. v. Arter &
Hadden, 85 Ohio St. 3d 171, 180 (1999); Automated Solutions Enters. v.
Clearview Software, Inc., 567 S.E.2d 335 (Ga. App. 2002); Volt Servs.
Group v. Adecco Empl. Servs., Inc., 35 P.3d 329 (Or. App. 2001);
Edwards v. Anaconda Co., 565 P.2d 190 (Ariz. App. 1977); Heavener,
Ogier Servs. v. R.W. Fla. Region, 418 So. 2d 1074 (Fla. App. 1982);
Belden, 413 N.E.2d at 101-02; Macklin, 639 A.2d at 120; N. Plumbing &
Htg. v. Henderson Bros., 268 N.W.2d 296 (Mich. App. 1978); United Wild
Rice v. Nelson, 313 Nw.2d 628 (Minn. 1982); Martin v. Phillips Petroleum
Co., 455 S.W.2d 429, 435 (Tex. App. 1970); Wilder v. Cody Country
Chamber of Commerce, 868 P.2d 211, 225 (Wyo. 1994).

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