JAMES E. GRITZNER, District Judge.
Before the Court are motions for summary judgment brought by Defendant Quad City Virtual, Inc. (QCFSBO) and Defendant Symmetry Mortgage Corp. (Symmetry), which Plaintiff Home Show Tours, Inc. (Home Show) resists. The matter came on for hearing on December 13, 2010. Attorney James Zmuda (Zmuda) represented Home Show; Attorney Ian Russell represented QCFSBO; and Attorney Mark Fowler represented Symmetry. The matter is fully submitted and ready for disposition.
Since 1999, QCFSBO co-founders Rebecca Banerjee (Banerjee) and Sam Banerjee have owned and operated QCFSBO. com, a for sale by owner (FSBO) real estate website that advertises FSBO real estate listings and other real estate-related services. Troy Vavrosky (Vavrosky) owns Home Show, which also operates a FSBO website, QCHomeshow.com (aka QuadCity Homeshow.com). Both QCFSBO and Home Show serve the Quad City Area.
Symmetry, which is primarily owned by Greg Franich (Franich) and Erin Franich, sells and services home mortgages. Approximately
On June 18, 2003, QCFSBO and Symmetry entered into a written mutual advertising/referral agreement (the QCFSBO-Sym Agreement), under the terms of which QCFSBO would "not refer to any other mortgage service provider other than Symmetry" and Symmetry would "not refer a seller or someone that wishes to advertise anywhere but QCFSBO." Franich Dep., QCFSBO's App. 83, ECF No. 37-3. QCFSBO and Symmetry did not exchange money for the QCFSBO-Sym Agreement. The terms of the QCFSBO-Sym Agreement did not require Symmetry customers to use QCFSBO's services nor did it require QCFSBO's customers to use Symmetry's services.
Franich is a licensed real estate broker and a member of the Quad City Board of Realtors and, as such, has access to the Quad City Area Multiple Listing Service (MLS). Symmetry admits that it shared certain MLS information with QCFSBO approximately once every three-to-four months but that the information is limited to (1) verbal verification as to whether or not a current or potential client of QCFSBO's is listed with a realtor on the MLS, and (2) gross marketing statistics to assist in the preparation of general marketing information for joint seminars with QCFSBO and others.
In 2002 or 2003, QCFSBO entered into a sponsorship-advertising package (sponsorship package) with Clear Channel Communications (Clear Channel), which operates several radio stations in the Quad City Area.
On September 30, 2008, Home Show filed a complaint against QCFSBO alleging claims for libel per se, libel per quod, false light, and violations of the Lanham Act, 15 U.S.C. §§ 1501 et seq. On May 5, 2009, Home Show amended its complaint adding a claim for intentional interference with business relationships against QCFSBO, and on October 7, 2009, Home Show amended its complaint a second time naming Defendant Symmetry in Count VI and therein adding an anti-trust claim against QCFSBO and Symmetry under the Sherman Act, 15 U.S.C. §§ 1, 2.
QCFSBO moves for summary judgment on all six counts, and Symmetry moves for summary judgment on Count VI, asserting that Home Show has produced no evidence to support its claims or to demonstrate it has been damaged by the Defendants' alleged conduct. Home Show resists, arguing that it has established multiple questions of material fact with respect to each of its claims.
Summary judgment is appropriate when the evidence, viewed in the light most favorable to the non-moving party, demonstrates there are no outstanding issues of material fact and the moving party is entitled to judgment as a matter of law. MSK EyEs Ltd. v. Wells Fargo Bank, NA, 546 F.3d 533, 540 (8th Cir.2008). "[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." P & O Nedlloyd, Ltd. v. Sanderson Farms, Inc., 462 F.3d 1015, 1018 (8th Cir. 2006) (quoting Anderson v. Liberty Lobby Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). Home Show "may not merely point to unsupported self-serving allegations, but must substantiate [its] allegations with sufficient probative evidence that would permit a finding in [its] favor, without resort to speculation, conjecture, or fantasy." Reed v. City of St. Charles, Mo., 561 F.3d 788, 790-91 (8th Cir.2009) (internal quotations and citations omitted). "In sum, the evidence must be `such that a reasonable jury could return a verdict for the nonmoving party.'" Id. (quoting Anderson, 477 U.S. at 248, 106 S.Ct. 2505).
Home Show does not specifically identify in the body of its complaint those statements that form the bases of its Lanham Act, libel, and false light claims.
Second Am. Compl. ¶ 7, ECF No. 28 (emphasis added). Exhibit A to Home Show's second amended complaint (Exhibit A) is comprised of a cease and desist letter from Home Show's attorney, Zmuda, to QCFSBO and sixteen screenshots from QCFSBO.com. The screenshots contain Home Show's cryptic annotations identifying Home Show's objections and why Home Show believes those statements are actionable. Ex. A, Second Am. Compl., ECF No. 28-1.
The Court is never obligated to go beyond a party's efforts and sift the record for facts to support a claim. See Libel v. Adventure Lands of Am., Inc., 482 F.3d 1028, 1032 (8th Cir.2007) ("Courts have neither the duty nor the time to investigate the record in search of an unidentified genuine issue of material fact to support a claim or defense."); Crossley v. Georgia-Pacific Corp., 355 F.3d 1112, 1113 (8th Cir.2004); White v. McDonnell Douglas Corp., 904 F.2d 456, 458 (8th Cir.1990) ("A district court is not required to speculate on which portion of the record a nonmoving party relies ..." (quoting InterRoyal Corp. v. Sponseller, 889 F.2d 108, 111 (6th Cir.1989))). It appears the only reasonable way to summarize the claimed harmful and actionable statements is to set forth the notations in Exhibit A. The following list includes a description of the QCFSBO.com web page link, the challenged statement(s) therein set out in quotation marks, and Home Show's (quoted) annotations set out in italics:
Second Am. Compl., Ex. A, ECF No. 28-1.
QCFSBO asserts it is entitled to summary judgment on Home Show's claims for Lanham Act violations, libel, false light, and intentional interference because Home Show has produced no evidence QCFSBO made a false statement and Home Show's mere "belief" that statements on QCFSBO.com are false is not enough to avoid summary judgment.
In resistance, Home Show states there are genuine disputes as to (1) whether QCFSBO has cast Home Show in a false light and consequently caused Home Show to suffer damages, and (2) the extent of QCFSBO's exclusive contract with Symmetry.
The Lanham Act, 15 U.S.C. § 1125(a)(1), in relevant part, provides,
"The purpose of this Act is `to protect persons engaged in commerce against false advertising and unfair competition.'" Allsup, Inc. v. Advantage 2000 Consultants Inc., 428 F.3d 1135, 1138 (8th Cir.2005) (quoting Am. Italian Pasta Co. v. New World Pasta Co., 371 F.3d 387, 390 (8th Cir.2004)).
Id. (quotation marks and internal citations omitted). A finding of literal falsity is less-likely supported where "[t]he greater the degree to which a message relies upon the viewer or consumer to integrate its components and draw the apparent conclusion." United Indus. Corp. v. Clorox Co., 140 F.3d 1175, 1183 (8th Cir. 1998). "Commercial claims that are implicit, attenuated, or merely suggestive usually cannot fairly be characterized as literally false." Id.
Am. Italian Pasta, 371 F.3d at 390-91 (alterations in original) (internal quotation marks and citations omitted); see also United Indus. Corp., 140 F.3d at 1180 (noting that puffery does not include "false descriptions of specific or absolute characteristics of a product and specific, measurable claims of product superiority").
Home Show challenges statements, which include (1) "QCFSBO is the #1 FSBO destination in the QCA"; (2) "QCFSBO is the one and only 100% FSBO website of the Quad Cities"; and (3) "[QCFSBO has] the best exposure in the QCA"; (QC App. 45). Home Show also challenges representations of Home Show as "the No. 2 website."
There are two types of comparative advertising claims under the Lanham Act: "(1) `my product is better than yours' and (2) `tests prove that my product is better than yours.' When challenging a claim of superiority that does not make express reference to testing, a plaintiff must prove that the defendant's claim of superiority is actually false, not simply unproven or unsubstantiated." United Indus. Corp., 140 F.3d at 1181-82 (internal citations omitted).
When asked whether the statements on QCFSBO's website were false, Vavrosky said they were "not accurate." QCFSBO's App. 32-63.
Vavrosky Dep., QCFSBO's App. 44-45, ECF No. 37-3. Vavrosky gave similar responses when asked about the other screenshots contained in Exhibit A. Home Show never supplemented the record to follow up on those questions to which Vavrosky responded, "I'd have to get back to you on that." Id.
Nothing in Vavrosky's testimony demonstrates that the statements contained on QCFSBO's website were actually false, rather Vavrosky's testimony merely demonstrates Home Show's subjective disagreement with those statements. Similarly, Home Show's annotations of "untrue" and "unproven," found on the screenshots contained in Exhibit A, amount to unsupported allegations of falsity or disagreement and simply do not generate a genuine issue of material fact to defeat summary judgment on a Lanham Act claim. See United Indus. Corp., 140 F.3d at 1181-82.
Furthermore, most of QCFSBO's statements of superiority in the Quad Cities' FSBO real estate market contain various qualifiers, such as, (1) "QCFSBO is the #1 FSBO destination in the QCA"; (2) "QCFSBO is the one and only 100% FSBO website of the Quad Cities," and (3) "[QCFSBO has] the best exposure in the QCA." Ex. A, Second Am. Compl., ECF No. 28-1. Although Home Show asserts that QCFSBO's statements are "too targeted, mathematical and precise" to constitute mere puffery, Home Show offers no evidence that these statements are anything more than "vague or highly subjective claims of product superiority" or "bald assertions of superiority." Am. Italian Pasta, 371 F.3d at 390. Accordingly, because QCFSBO does not contend its statements of superiority are based upon studies or other empirical data, the Court finds they constitute nothing more than mere puffery, and are not actionable under the Lanham Act. See Ideal Instruments, Inc. v. Rivard Instruments, Inc., 479 F.Supp.2d 968, 986 (N.D.Iowa 2007) (finding that a Lanham Act false advertising claim must "first and foremost, be based on a factual statement"); see also Am. Italian Pasta, 371 F.3d at 392-93 (agreeing with the Seventh Circuit Court of Appeals' conclusions in Mead Johnson & Co. v. Abbott Laboratories, 201 F.3d 883 (7th Cir.), opinion amended on denial of reh'g, 209 F.3d 1032 (7th Cir.2000), that "[t]o allow a consumer survey to determine a claim's benchmark would subject any advertisement or promotional statement to numerous variables, often unpredictable, and would introduce even more uncertainty into the market place").
For the reasons stated, QCFSBO is entitled to summary judgment on Home Show's Lanham Act claim.
QCFSBO asserts that it is entitled to summary judgment on Home Show's libel claims because Home Show has failed to meet its burden of showing the claims were published with actual malice. Home Show resists arguing evidence in the record demonstrates that "Home Show is the target of many insidious and inaccurate comments on QCFSBO" that "are libelous per se." Pl.'s Resp. Br. 9, ECF No. 49-1.
"Defamation involves the publication of written or oral statements which tend to injure a person's reputation and good name." Kerndt v. Rolling Hills Nat'l Bank, 558 N.W.2d 410, 418 (Iowa 1997). Defamation involves the twin torts of libel and slander. Theisen v. Covenant Med. Ctr. Inc., 636 N.W.2d 74, 83 (Iowa 2001) (citing Lara v. Thomas, 512 N.W.2d 777, 785 (Iowa 1994)). "Libel is generally a written publication of defamatory matter, and slander is generally an oral publication of such matter." Yates v. Iowa W. Racing Ass'n, 721 N.W.2d 762, 768 (Iowa 2006) (quoting Schlegel v. Ottumwa Courier, 585 N.W.2d 217, 221 (Iowa 1998)).
"An attack on the integrity and moral character of a party is libelous per se." Vinson v. Linn-Mar Cmty. Sch. Dist., 360 N.W.2d 108, 116 (Iowa 1984). "If a statement is clear and unambiguous, the issue of whether the statement is libelous per se is for the court. If the court determines a statement is libelous per se as a matter of law, the burden shifts to the defendant to prove the statement was used and understood in a different sense." Kiesau v. Bantz, 686 N.W.2d 164, 175 (Iowa 2004) (citations omitted).
Shaw Cleaners & Dyers v. Des Moines Dress Club, 215 Iowa 1130, 245 N.W. 231, 233 (1932); Ragland v. Household Fin. Corp., 254 Iowa 976, 119 N.W.2d 788, 790 (1963) (citations omitted) ("The determination of whether a publication is libelous per se is for the court in the first instance. This determination is made by reference to the statements made, without reference to the defamatory sense in which plaintiff claims such statements were intended and understood."). If a defendant's statement is found to be libelous per se, damage to reputation is presumed. Schlegel, 585 N.W.2d at 222.
"[S]ome statements are defamatory per se; that is, they are of such a nature that the court can presume as a matter of law that their publication will have a defamatory effect, even without a showing by the plaintiff of malice, falsity, or damage." Kerndt, 558 N.W.2d at 418. Statements qualifying as libel per se have been described in four general categories: "imputation of (1) certain indictable crimes, (2) loathsome disease, (3) incompetence in occupation, and (4) unchastity." Barreca v. Nickolas, 683 N.W.2d 111, 116 (Iowa 2004) (citing, in parenthetical, Patrick J. McNulty, The Law of Defamation: A Primer for the Iowa Practitioner, 44 Drake L.Rev. 639, 650-52 (1996)).
Home Show argues that QCFSBO's statement regarding Home Show falsifying its origination date constitutes libel per se. The statement, in pertinent part, says "there are companies in the QCA who are boldly falsifying public records. ... [by] declaring on its website and radio ads that they have been `successfully helping Quad City sellers advertise their property for sale' since 1999. ... [but this] website did not exist in 1999! The domain name was not registered until April 28, 2000 and the website was launched long after that." Ex. A, Second Am. Compl., ECF No. 28-1; see also discussion supra Part II.B.8.d.
By Home Show's own admission, this statement is not false. Vavrosky testified that he did not launch a FSBO website until 2000 and did not incorporate as QuadCityHomeShow.com until 2004. Furthermore, the statement does not fall into the category of an "imputation of (1) certain indictable crimes, (2) loathsome disease, (3) incompetence in occupation, and (4) unchastity," and therefore does not constitute libel per se. Barreca, 683 N.W.2d at 116.
Home Show alternatively argues that if this statement does not constitute libel per se, "a finding of libel per quod is nonetheless warranted." Pl.'s Resp. Br. 12, ECF No. 49-1. Home Show asserts that the statement regarding falsifying records
"A statement is libelous per quod if it is necessary to refer to facts or circumstances beyond the words actually used to establish the defamation." Johnson v. Nickerson, 542 N.W.2d 506, 510 (Iowa 1996). To sustain an action for defamation based on libel per quod, a plaintiff must be able to prove some cognizable injury, such as injury to reputation. Kiesau, 686 N.W.2d at 175. In an action based on libel per quod, a plaintiff must show damage other than just hurt feelings. Id.; Schlegel, 585 N.W.2d at 222 ("In case of statements that are not libelous per se but libelous per quod, this means a plaintiff must first prove actual damage to reputation before the plaintiff can recover for mental anguish or hurt feelings.").
To demonstrate a prima facie case of libel per quod, Home Show must show (1) QCFSBO published a statement; (2) the statement was defamatory; (3) the statement was "of and concerning" the plaintiff; and (4) the statement resulted in injury to the plaintiff. Schlegel, 585 N.W.2d at 221.
To prove defamation, the plaintiff ordinarily must show the statements "were made with malice, were false, and caused damage." Id. Substantial truth is a complete defense to a defamation action. Behr v. Meredith Corp., 414 N.W.2d 339, 342 (Iowa 1987). "[A] libel defendant is not required to establish the literal truth of the publication in every detail as long as the `sting' or `gist' of the defamatory charge is substantially true." Id. "The gist or sting of the defamatory charge, according to one court, is `the heart of the matter in question—the hurtfulness of the utterance.'" Id. (quoting Vachet v. Cent. Newspapers, Inc., 816 F.2d 313, 316 (7th Cir.1987)). "If the underlying facts as to the gist or sting of the defamatory charge are undisputed, the court may determine substantial truth as a matter of law." Id.
The Iowa Supreme Court has adopted the following four-factor test for the trial court to use in determining whether the challenged statement is defamatory: (1) "the precision and specificity of the disputed statement"; (2) "`the degree to which the [alleged defamatory] statements are ... objectively capable of proof or disproof [ ]'"; (3) "the context in which the alleged defamatory statement occurs"; and (4) "`the broader social context into which [the alleged defamatory] statement fits.'" Yates, 721 N.W.2d at 771-72 (quoting Jones v. Palmer Commc'n, Inc., 440 N.W.2d 884, 891-92 (Iowa 1989), overruled on other grounds by Schlegel, 585 N.W.2d at 224).
"A trial court's initial task in a defamation action is to decide whether the challenged statement is `capable of bearing a particular meaning, and whether that meaning is defamatory.'" Yates, 721 N.W.2d at 771-72 (quoting Restatement (Second) of Torts § 614(1)).
Id. at 772 (quoting Guilford Transp. Indus., Inc. v. Wilner, 760 A.2d 580, 594 (D.C.2000) (internal citation omitted in original)).
The Iowa Supreme Court has "adopted the view espoused in Restatement (Second) of Torts, section 581A comment f, that if an allegedly defamatory statement is substantially true, it provides an absolute defense to an action for defamation." Id. at 768-69 (internal quotation omitted). Comment f states, in pertinent part, "many charges are made in terms that are accepted by their recipients in a popular rather than a technical sense. ... It is not necessary to establish the literal truth of the precise statement made. Slight inaccuracies of expression are immaterial provided the defamatory charge is true in substance." Restatement (Second) of Torts § 581A cmt. f (1977).
Home Show has failed to make a prima facie case of libel per quod. Schlegel, 585 N.W.2d at 221. Although the published statement element is satisfied, Home Show has not demonstrated that the statements were defamatory, "of and concerning" the Plaintiff, or resulted in injury to the Plaintiff. Id. Similar to the statement regarding Home Show's origination date, the statement regarding one-person, home-based operations is substantially true. Vavrosky admitted that he is Home Show's sole employee and operates Home Show out of his home:
Vavrosky Dep., QCFSBO's App. 34, ECF No. 37-3. Vavrosky also admitted that he did not buy the QuadCityHomeShow.com domain until 2000 and did not incorporate as Home Show Tours until 2004. Accordingly, because QCFSBO's statements are substantially true, Home Show cannot maintain its libel per quod claim. See Behr, 414 N.W.2d at 342.
In addition, Home Show has failed to produce any evidence of damages. Home Show submits customers' letters informing Home Show that they were going to use the "other" website. Customer Letters, Home Show's App. 92-99, ECF No. 51-2. However, the letters all indicate the customers were switching websites because they had not achieved results through Home Show's website; the letters provide no indication that the statements on QCFSBO's website influenced those decisions. Additionally, Vavrosky testified that he could not identify any specific individuals that did not hire Home Show as a result of any of the allegations in the Second Amended Complaint:
Vavrosky Dep., QCFSBO's App. 61, ECF No. 37-3. Home Show never supplemented the record.
Home Show also asserts "[a]s for damages, Home Show experienced harm to its reputation from the misrepresentation on QCFSBO's website, and it also saw a major decline in revenues." Pl.'s Resp. Br. 13, ECF No. 49-1. At Home Show's request, Certified Public Accountant Wendy Wassell-Verschoore (the CPA) compiled a report based upon Home Show's tax returns from 2004 through 2009, showing, in pertinent part, that in gross receipts, Home Show experienced a slight but steady increase from 2005 through 2007, a notable decline in 2008, and a rebound in 2009. The CPA's report included the disclaimer that she made "no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose." CPA report, QCFSBO's App. 95, ECF No. 37-3. Even accepting the contents of the CPA's report as true, it does not create a fact issue of a nexus between QCFSBO's statements and Home Show's 2008 decline in revenue.
For these reasons, Home Show has failed to satisfy the required elements for a prima facie showing of libel per quod.
Home Show bases its false light claim on the same statements as its libel claims and asserts summary judgment is inappropriate because a reasonable person would find QCFSBO's accusations about Home Show offensive.
"A claim for false light invasion of privacy is based upon an untruthful publication which places a person before the public in a manner that would be highly offensive to a reasonable person." Willson v. City of Des Moines, 386 N.W.2d 76, 83 n. 8 (Iowa 1986). In defining the tort of false light, Iowa has adopted the Restatement (Second) of Torts § 652E, see id., which states,
The tort of false light "overlaps the law of defamation," Winegard v. Larsen, 260 N.W.2d 816, 823 (Iowa 1977), and therefore requires proof of untruthfulness, however the plaintiff need not prove that he was defamed, see McFarland v. McFarland, 684 F.Supp.2d 1073, 1093 (N.D.Iowa 2010). "Even when deliberately false statements are made, they are not actionable under the false light theory unless they are material and substantial." Winegard, 260 N.W.2d at 823.
One who has established a cause of action for invasion of his privacy is entitled to recover damages for
Kish v. Iowa Cent. Cmty. Coll., 142 F.Supp.2d 1084, 1100 (N.D.Iowa 2001) (quoting Restatement (Second) of Torts § 652H (1977)) (noting that because the Iowa Supreme Court has adopted the principles of invasion of privacy as set forth in Restatement (Second) of Torts, the applicable standard for damages as a result of that tort would also be found in the Restatement).
As with its libel claims, Home Show has failed to show the untruthfulness of the statements contained on QCFSBO's website or that Home Show was damaged by those statements. See id. (applying Iowa law and finding that the plaintiff failed to generate a genuine issue of material fact on the essential element of damages, and therefore defendant was entitled to summary judgment on plaintiff's false light claim). Again, Home Show has failed to go beyond the pleadings or its own deposition statements and therefore has failed to demonstrate there are genuine issues of material fact that preclude summary judgment. See id.; Chapman v. Labone, 460 F.Supp.2d 989, 1007 (S.D.Iowa 2006) (applying Iowa law and concluding the plaintiff's false light claim failed as a matter of law, as had the plaintiff's defamation claim, because the plaintiff failed to show the defendant knew the statement was false or that the defendant acted recklessly or knowingly regarding the falsity of the statement).
QCFSBO argues it is entitled to summary judgment on Home Show's intentional interference claims because the challenged conduct—QCFSBO's contract with Clear Channel—is based upon a legal relationship between QCFSBO and Clear Channel and that contract was not entered into interfere with Home Show. Home Show contends QCFSBO's conduct was improperly calculated to cause Home Show to lose business.
To recover for intentional interference with an existing contract, a plaintiff must show
Jones v. Lake Park Care Ctr. Inc., 569 N.W.2d 369, 377 (Iowa 1997) (quoting Hunter v. Bd. of Trs., 481 N.W.2d 510, 518 (Iowa 1992)).
The Iowa Supreme Court has also observed,
Berger v. Cas' Feed Store, Inc., 543 N.W.2d 597, 599 (Iowa 1996).
QCFSBO's sponsorship package with Clear Channel rendered QCFSBO the exclusive right to advertise during certain radio programs. Home Show admits that it did not have an exclusive sponsorship package with Clear Channel at the time QCFSBO entered into the Clear Channel sponsorship package. An email dated November 6, 2008, from Jeff Ashcraft (Ashcraft) of Clear Channel responding to Vavrosky's complaint about not being able to advertise during the QCFSBO-sponsored broadcasts provides no evidence that QCFSBO and Clear Channel in any way entered into the exclusive sponsorship package to interfere with Home Show:
Ashcraft email of Nov. 6, 2008, Home Show App. 85, ECF No. 51-2.
Ashcraft's Nov. 6 email demonstrates that Home Show, not QCFSBO, contacted Clear Channel about the contractual
Moreover, merely showing interference with a contractual relationship between Home Show and Clear Channel would not have been enough; Home Show needed to demonstrate the interference was improper. See Books Are Fun, Ltd. v. Rosebrough, No. 4:05-cv-00644-JEG, 2006 WL 2583717, at *8 (S.D.Iowa Sept. 6, 2006) ("[I]ncidental damages resulting from a defendant's pursuit of its own competitive interests do not necessarily lead to the conclusion that intentional interference was also improper.").
Additionally, Home Show's claim fails because Home Show has not demonstrated that it was damaged as a result of the alleged interference.
Home Show has failed to demonstrate a prima facie case of intentional interference with contractual relationship, and therefore QCFSBO is entitled to summary judgment on this claim. See Kern, 757 N.W.2d at 662.
QCFSBO also moves for summary judgment on Home Show's claim that QCFSBO intentionally interfered with Home Show's prospective business relationship with Clear Channel "by insisting that Clear Channel prohibit [Home Show] from advertising during times and programs in which QCFSBO advertises." Second Am. Compl. 5, ECF No. 28.
To prevail on this claim, Home Show must demonstrate that (1) Home Show had a prospective contractual or business relationship with Clear Channel, (2) QCFSBO knew of the prospective relationship, (3) QCFSBO intentionally and improperly interfered with the relationship by insisting Clear Channel prohibit Home Show from advertising during times and programs in which QCFSBO advertises, (4) the interference caused Clear Channel not to enter into or continue the relationship or that the interference prevented the Home Show from entering or continuing the relationship; and (5) the amount of damage. Nesler v. Fisher & Co., Inc., 452 N.W.2d 191, 198-99 (Iowa 1990). "In a claim of interference with a prospective business advantage, the `purpose on the defendant's part to financially injure or destroy the plaintiff is essential.'" Id. (quoting Page Cnty. Appliance Ctr. v. Honeywell, 347 N.W.2d 171, 177 (Iowa 1984)).
As discussed in regard to Home Show's intentional interference with existing business relationship claim, Home Show has failed to create any inference of an improper purpose and damages, which are also elements of intentional interference with prospective business relationship claim. In addition, Home Show has produced no evidence to generate a factual
QCFSBO and Symmetry move for summary judgment on Home Show's antitrust claim arguing Home Show has failed to show that any agreement between QCFSBO and Symmetry was anti-competitive or that Home Show suffered any damages as a result of these alleged violations. Home Show resists arguing that a number of issues give rise to issues of material fact with respect to whether QCFSBO and Symmetry have engaged in violations of the Sherman Act, including (1) the relationship between QCFSBO and Symmetry, (2) their exclusive referral agreement, (3) QCFSBO's exclusive customer contract, and (4) QCFSBO's motivations in operating under such agreements.
"Under [the Sherman] Act, it is unlawful to contract or form a conspiracy `in restraint of trade or commerce among the several States,' 15 U.S.C. § 1, or to `monopolize or attempt to monopolize ... any part of the trade or commerce among the several States,' 15 U.S.C. § 2." Little Rock Cardiology Clinic PA v. Baptist Health, 591 F.3d 591, 596 (8th Cir.2009).
"It is axiomatic that the antitrust laws were passed for the protection of competition, not competitors. Disappointment at not receiving [a specific hoped-for contract] is insufficient as a matter of law to rise to the level of an antitrust violation within a relevant market." Double D Spotting Serv., Inc. v. Supervalu, Inc., 136 F.3d 554, 561 (8th Cir.1998) (internal quotation marks and citation omitted).
Section 1 of the Sherman Act, in pertinent part, provides, "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is hereby declared to be illegal." 15 U.S.C. § 1. However, section 1 is "intended to prohibit only unreasonable restraints of trade." Nitro Distrib., Inc. v. Alticor, Inc., 565 F.3d 417, 423 (8th Cir.2009) (quoting Bus. Elecs. Corp. v. Sharp Elecs. Corp., 485 U.S. 717, 723, 108 S.Ct. 1515, 99 L.Ed.2d 808 (1988)). "The burden of proving the unreasonableness of a restraint lies with the plaintiff." Craftsmen Limousine, Inc. v. Ford Motor Co. (Craftsmen II), 491 F.3d 380, 386 (8th Cir.2007).
"The United States Supreme Court has set forth three methods for analyzing the reasonableness of a restraint on trade: rule of reason analysis, per se analysis, and quick look analysis.... The rule of reason is the `prevailing standard' for determining a restraint's effect upon competition in a relevant market." Craftsmen Limousine, Inc. v. Ford Motor Co. (Craftsmen I), 363 F.3d 761, 772-73 (8th Cir.2004) (citing Cont'l T.V. Inc. v. GTE Sylvania Inc., 433 U.S. 36, 49, 97 S.Ct. 2549, 53 L.Ed.2d 568 (1977)); Bus. Elecs. Corp., 485 U.S. at 726, 108 S.Ct. 1515 ("[T]here is a presumption in favor of a rule-of-reason standard"); State Oil Co. v. Khan, 522 U.S. 3, 22, 118 S.Ct. 275, 139 L.Ed.2d 199 (1997) ("[T]he majority of commercial arrangements subject to the antitrust laws [] should be evaluated under the rule of reason"). In this case, the Court uses the "rule of reason" test to determine whether the restraint of trade was unreasonable.
Home Show bears the burden of ultimately demonstrating "an antitrust violation, the fact of damage or injury, a causal relationship between the violation and the injury, and the amount of damages." Concord Boat Corp. v. Brunswick Corp., 207 F.3d 1039, 1055 (8th Cir.2000) (internal quotation omitted).
Home Show argues that because "QCFSBO is the number one for sale by owner website in the Quad City area," together with "the exclusive [QCFSBO-Sym] referral agreement has the effect of channeling increasing numbers of clients toward Symmetry, and consequently depriving greater numbers of property owners of the information they need to make a free choice." Pl.'s Resp. Br. 9, ECF No. 50-3. Home Show further asserts the QCFSBO and Symmetry relationship, which includes an exclusive advertising agreement, shared building tenancy, and Symmetry providing QCFSBO access to the MLS listing, confers an anti-competitive advantage upon QCFSBO. Home Show maintains that this advantage is demonstrated by Banerjee's testimony, which was based upon data generated by third-party software, that QCFSBO has the greatest number of hits and adds more listings per week than any other FSBO website.
Despite Home Show's various assertions, it has not presented any evidence that any agreement between QCFSBO and Symmetry is anti-competitive. Home Show presents no legal authority for the proposition that an exclusive advertising agreement is illegal. To the contrary, such agreements are common. Nor does the fact that QCFSBO and Symmetry lease adjacent building space restrain trade. Further, undisputed testimony demonstrates that Symmetry provides mortgage services to non-QCFSBO customers and QCFSBO's customers use mortgage services other than Symmetry's. Even more apparent, however, is the absolute absence of evidence that Home Show was damaged as a result of QCFSBO and Symmetry's alleged practices. See Amerinet, Inc. v. Xerox Corp., 972 F.2d 1483, 1495 (8th Cir.1992) (concluding that summary judgment in favor of the defendant on plaintiff's Sherman Act claim was properly granted because the plaintiff failed to establish the causal connection between its decline and the defendants' alleged antitrust violations and also failed to establish any reasonable basis for determining its damages).
"A prima facie claim of monopolization under the Sherman Act requires [Home Show] to show that [QCFSBO] `possessed monopoly power in the relevant market' and `willfully acquired or maintained that power.'" HDC Med., Inc. v.
Even assuming Home Show had demonstrated that QCFSBO has a dominate market share, Home Show has presented no evidence that QCFSBO had the specific intent to monopolize or that there was an anti-competitive effect due to the QCFSBO-Sym Agreement. Home Show has shown no more than disappointment at not having a similarly exclusive relationship, which, as a matter of law, does not rise to the level of an antitrust violation. See Double D, 136 F.3d at 561. QCFSBO's conduct is undisputably competitive; however, the Sherman Act does not insulate competitors from all competition, only unfair competition. See Mayer Hoffman McCann, P.C. v. Barton, 614 F.3d 893, 909 (8th Cir.2010) ("The purpose of the [Sherman] Act is not to protect businesses from the working of the market; it is to protect the public from the failure of the market. The law directs itself not against conduct which is competitive, even severely so, but against conduct which unfairly tends to destroy competition itself. It does so not out of solicitude for private concerns but out of concern for the public interest.") (quoting Spectrum Sports, Inc. v. McQuillan, 506 U.S. 447, 458, 113 S.Ct. 884, 122 L.Ed.2d 247 (1993)).
For the reasons stated, QCFSBO's motion for summary judgment (ECF No. 37) and Symmetry's motion for summary judgment (ECF No. 42) must be
Banerjee Dep., Home Show App. 75-77, ECF No. 51-1.