Holter v. Moore & Co.
Holter v. Moore & Co.
Opinion of the Court
Appellants sold their house through defendant Moore and Company (a Colorado real estate broker) and one of its licensed
Section 1 of the Sherman Act can be violated only by concerted action by a plurality of actors. Blankenship v. Herzfeld, 661 F.2d 840, 846 (10th Cir. 1981). Since a corporation has no way of acting except through officers and employees, the officers and employees are part of the same economic unit as the corporation for antitrust purposes. Thus, officers and employees of a corporation are generally incapable of conspiring with the corporation or with each other.
Whether the relationship of the parties is employer-employee or principal-outside agent is normally a question of fact. See Blankenship v. Herzfeld, 661 F.2d at 846. However, the sufficiency of the evidence to create an issue of fact for the jury is solely a question of law. See Ogilvie v. Fotomat Corp., 641 F.2d 581, 589-90 (8th Cir. 1981); 9 C. Wright & A. Miller, Federal Practice and Procedure § 2524 (1971). Keeping in mind that summary judgment should be granted sparingly in antitrust eases, Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 473, 82 S.Ct. 486, 491, 7 L.Ed.2d 458 (1962), we must determine whether there was sufficient evidence in the record to create an issue of fact for the jury on whether the defendants were separate vertical and horizontal economic units rather than a firm and its employees.
Although existing cases dealing with the “single enterprise” doctrine have been criticized as lacking in certainty,
The starting point in this case is the law of Colorado under which the parties operate.
In addition to this legally required supervision, Moore supplies offices, secretaries, and real estate listings, and pays some expenses for the licensed agents. The appellants rely on the following indicia of economic separateness: (a) the agents are paid a commission, (b) Moore withholds no income or FICA taxes, or retirement benefit payments from the commissions, (c) each agent must be licensed by the state, (d) agents control their own hours, and (e) the agents pay some of their own expenses.
Our judgment is that the Colorado statutory scheme restricts the independence of the agents so much that they must be considered “employees” under section 1 of the Sherman Act. The Colorado provisions simply do not allow the agents to take any independent course of action that would be competitive with Moore. The nature of the relationship that Moore and the agents are legally required to maintain is so overwhelmingly one of superior and subordinate that the indicia relied on by the appellants are inconsequential. Payment by commission and the agents’ concomitant incurrence of some costs are not dispositive factors in determining whether there is one or many entities. See American Oil Co. v. McMullin, 508 F.2d 1345, 1351-52 (10th Cir. 1975). The requirement that the agents have licenses is consistent with their status as employees; it is no different from the case of beauticians employed by a single beauty parlor, Colo.Rev.Stat. § 12-8-120(2) (1978), or as
We conclude that the agents should be considered employees of Moore for antitrust purposes.
AFFIRMED.
. But see post n. 8.
. If we determined that the agents were sufficiently independent of Moore to be “outside” contractors, there would still be a difficult question to resolve since the cases reflect uncertainty as to when outside agents are capable of conspiring with their principle for purposes of § 1 of the Sherman Act. Compare Albrecht v. Herald Co., 390 U.S. 145, 88 S.Ct. 869, 19 L.Ed.2d 998 (1968) with Harold Friedman, Inc. v. Kroger Co., 581 F.2d 1068 (3d Cir. 1978). We need not reach the problems raised by the outside contractor cases since we find that Moore’s sales agents are not “outside contractors.”
See Note, “Conspiring Entities” under Section 1 of the Sherman Act, 95 Harv.L.Rev. 661 (1982). Even the critics, however, confess an inability to devise a clear test of their own. Id. at 680.
. By considering the state law under which the parties operate, we are simply examining the undisputed facts to determine whether the' agents are Moore’s “employees” under the doctrine that holds an employee incapable of conspiring with his corporate employer under § 1 of the Sherman Act. We are not invoking the immunity doctrine of Parker v. Brown, 317 U.S. 341, 63 S.Ct. 307, 87 L.Ed. 315 (1943).
. By rendering a corporation capable of acting only through its employees, a state’s corporation law renders the corporation and the employees incapable of acting independently of each other hence incapable of conspiring under § 1. Similarly, state law can render an agent capable of acting only under the supervision of a single employer, precluding the agent from acting independently of, or conspiring with, the employer. In either case, a federal standard of separateness governs.
. Colorado law precludes a sales agent from working for more than one broker by (a) limiting each agent to one license, Colo.Rev.Stat. § 12-61-109(4) (Supp. 1982), and (b) requiring an agent’s license to be in the custody of his broker, id. § 12-61-104(1) (1978).
. This holding forecloses the appellants’ argument that the appellees are capable of conspiring as joint venturers. Of course, it does not affect the applicability of § 1 of the Sherman Act to concerted action by more than one broker or agents of different brokers.
. Some courts have held that an officer of a corporation can conspire with the corporation if the officer will personally benefit from conspiring with the corporation to restrain trade. E.g., H & B Equip. Co. v. International Harvester, 577 F.2d 239, 244 (5th Cir. 1978); Greenville Publishing Co. v. Daily Reflector, Inc., 496 F.2d 391, 399 (4th Cir. 1974). This “independent personal stake” doctrine applies only when the officer has an outside economic interest, such as ownership of a competing corporation, through which he will benefit from the restraint. The appellants have not identified any such outside interest held by the agents. Thus, the doctrine does not apply to the facts of this case.
Reference
- Full Case Name
- Dwight J. HOLTER and Sandra A. Holter, individually and on behalf of others similarly situated v. MOORE AND COMPANY, William M. Moore, individually, and Timothy M. Miller, individually, and on behalf of a class composed of all other sales associates of Moore and Company acting as real estate agents for sellers of residential properties
- Cited By
- 11 cases
- Status
- Published