right arises in connection with the issue of liability, which is what is being tried, and has nothing to do with the postponed issue of damages.
The plaintiff has not shown and does not allege that she has ever had any business transactions with the defendants. She is not in the business of operating a motion picture theatre. The percentage provision of the leases merely gave a basis on which her rent could be computed and did not make her a partner in the business or give her any interest in it. Nor is she in the real estate business.
Whether or not any anti-trust plaintiff has been injured in his property depends upon two things, first, what the nature of the property is and, second, how remote the injury is.
'Injury' (under Section 4 of the Clayton Act) 'implies violation of a legal right.' Keogh v. Chicago & Northwestern Railway Company, 260 U.S. 156, 43 S. Ct. 47, 49, 67 L. Ed. 183. In the popular sense of the word, this plaintiff 'owns' the building, but her 'property' in it consists entirely of the right to the reversion after the expiration of the lease, plus the rights which she has retained by the leases in respect of it. There is no such thing as a conspiracy against a building, and the plaintiff's injury, if any, can only arise from a violation or impairment of such rights in the property as she has.
The plaintiff contends that she has been injured in her property in two ways. First, she says that if the theatre had been operated by the tenant showing pictures on first-run, the receipts would have been greater and she might have obtained a larger rental, by way of percentage, than she did. The fact is that while she would have had a right to rental above the minimum, if earned, she had nothing more than a hope that it ever would be earned. The tenant could have operated the business, from whatever motive, so as to keep the percentage from ever exceeding the minimum, for example, by cutting admission charges, discontinuing advertising or showing nothing but foreign language or documentary films, and there would be no right which the plaintiff could have asserted against him in that respect.
Second, the plaintiff claims that the fact that the theatre operated as a second-run house for a considerable period of time during the terms of the leases has depreciated its value. Of course a history of successful and profitable operation is always a good thing for the value of any business property, but I do not know of any way in which a landlord can compel his tenant to run his business so that he will make money. A landlord can of course, by provisions in the lease, control the tenant's operation as much as he pleases, as to the kind of business to be done, classes of commodities to be sold or in a motion picture theatre the kind of picture to be shown, but this plaintiff did not do so. On the contrary her leases divested her of almost all rights in connection with the tenant's operation of the business. As to the type of picture which the tenant could show, her rights were practically nil. The first two leases, those of 1926 and 1936, contain no restrictions whatever on the point. Leaving out of consideration numerous provisions relating to upkeep, repairs, subletting and default clauses, the only mention of operation occurs in two clauses, one of which is nothing but a stipulation against undesirable forms of entertainment and permits moving pictures, without limiting the type of picture to be shown, and the other provides against the tenant's closing the theatre entirely for more than three months in a year. The lease of 1946 adds to the provision permitting showing motion pictures the words 'on the earliest possible run' -- an expression allowing a good deal of latitude to the tenant.
However that may be, it is apparent that if this landlord has any rights at all in the property which could be injured by a conspiracy to withhold first-run pictures, directed against or participated in by the tenant, they are remote, uncertain and insubstantial.
This is not a case in which by reason of the unlawful acts of the defendants a tenant has been forced to default in his rent. That situation need not be considered here. Of course, this landlord did have a definite and substantial right to the minimum rental, but she has received that at all times, in full.
But even if it be assumed that the plaintiff had some property, some right, which was susceptible of injury, and that such injury could be traced to the acts of the defendants, the question of remoteness remains. This question takes on greater importance in the case of an anti-trust plaintiff who has never had any business transactions with the defendants than in the case of one who claims injury through direct business dealings with them. The difficulties which would arise unless some consideration be given to the remoteness or indirectness of the injury are particularly apparent in the motion picture business, in which thousands of theatres are owned by persons who have nothing to do with the operation of them and no right to interfere. In this particular case, the complaint charges that from 1940 on the tenant was a party to an agreement with the defendants for the operation of the Bryn Mawr Theatre as a second-run house. There was nothing in his lease to prevent him from so operating if he wished to, and it can be assumed that he found it more profitable to do so. In such a situation, where a tenant desires a particular kind of product, must the distributors seek out the owner of the building to ascertain whether they can safely give the tenant what he wants? It seems clear that unless a line is drawn excluding remote and indirect injuries to property owners in similar cases, an almost intolerable burden would be placed upon the whole industry.
There are not a great many decisions dealing with the scope of the term 'injury in his business or property', and such as there are are far from being in accord or establishing any clearly defined rule. It is generally recognized that stockholders, creditors or employees of a corporation do not come within the Act. Inasmuch as such persons undeniably suffer injury to their property when the corporation is injured, it would seem that the courts recognize that the Act does not give a right of action to every one who can trace a financial loss, however remote, to a violation of the anti-trust laws.
In determining the scope of the Act it must be remembered that the treble damage feature is an enforcement provision and superimposes a penalty upon compensation. As such it should not be literally construed if unreasonable results would be reached by so doing. Obviously, there must be a limit somewhere. It is not possible to formulate any general fule by which to determine what injuries are too remote to bring a plaintiff within the scope of the Act and I shall not attempt to do so. Each case must be dealt with on its own facts. All that is decided here is that this plaintiff's loss, if any, is beyond the limit of injuries cognizable under the anti-trust laws.
The motions are denied.
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