agreements" had even the remotest bearing on the conspiracy alleged by plaintiffs. And Sears' role in the continuation of the financially distressed Warwick as a viable entity, by way of the Sanyo acquisition, was plainly in its self-interest given its heavy financial investment in Warwick, which was thereby protected.
There is simply no evidence to support plaintiffs' claims that any of the acquisitions, or the establishment by any defendants of manufacturing facilities in the United States, were related to the "unitary" conspiracy.
12. Evidence of the Participation of Individual Defendants in the Conspiracy
We shall not attempt to summarize here our lengthy canvass of the evidence as to each defendant. Instead we note only that there is no evidence, discrete as to any of the 24 defendants, of their participation in the alleged conspiracy. Moreover, as to certain of the defendants there are reasons in addition to those noted earlier in this summary making it illogical to infer that at least certain of the defendants participated in the supposed predatory low price export conspiracy (e.g., Sony, because of its well-known position as the highest-priced seller in the U.S. market; and MC, MIC, Sears, and Motorola because of their normal desire, as purchasers of CEP's, to get the lowest possible price). There is also no evidence linking the sales subsidiaries of the various defendants to the conspiracy.
13. Admissibility of Coconspirator Declarations
We have made pursuant to F.R.E. 104(a) a preliminary determination as to the admissibility of coconspirator statements under F.R.E. 801(d)(2)(E). That determination is in the nature of a factual finding that plaintiffs have not established by a preponderance of independent evidence that any of the defendants entered into an agreement or acted in concert with respect to exports to the United States in any manner which could in any way have injured the plaintiffs. Put differently, we have found that plaintiffs have not established, by the requisite degree of proof, that any of the defendants engaged in the export facet of the "unitary" conspiracy alleged by plaintiffs (or in the home market facet, either). Given this finding under the applicable Third Circuit standards, no coconspirator declarations may be admitted.
Notwithstanding their mountain of "evidence," plaintiffs have not yet stepped off home plate in their effort to establish the existence of the "unitary" conspiracy, much less come forward with the "significant probative evidence" of the conspiracy. First National Bank of Arizona v. Cities Service Co., supra. We have given plaintiffs the benefit of all inferences to which they are entitled and have analyzed the many facets of plaintiffs' conspiracy allegations, but have found each wanting. We have looked for direct evidence, and we have looked for circumstantial evidence from parallel business behavior and from all the potential sources, but we have found none. We have looked for evidence of when this conspiracy began and when the various parties entered it, but again we have found none. That is, we suppose, because there is no evidence of agreement or of concerted action.
As we have engaged in this analysis we have not been unmindful of plaintiffs' warning, bottomed on Continental Ore Co. v. Union Carbide & Carbon Corp., supra, against "fragmentation" of their case. Continental Ore does not, of course, prevent us from analyzing the plaintiffs' conspiracy allegations, and it is clear that by merely intoning the magic words "unitary conspiracy" or "totality of the evidence" antitrust plaintiffs cannot foreclose critical analysis. Notwithstanding these principles, in addition to analyzing the discrete aspects of plaintiffs' case, we have looked at the totality of the evidence. We have avoided "tightly compartmentalizing the various factual components and wiping the slate clean after scrutiny of each." Continental Ore, supra. In so doing we have searched for instances where one piece of evidence might inform other evidence. However, this approach has not helped the plaintiffs, for none of their evidence is probative, much less significantly probative.
Nor can plaintiffs claim any synergistic result. The comments of the Ninth Circuit in California Computer Products, Inc. v. International Business Machines Corp., 613 F.2d 727, 746 (9th Cir. 1979), are apposite here:
But there can be no synergistic result ... from a number of acts none of which show causal antitrust injury to CalComp.
Nothing plus nothing times nothing still equals nothing. Summary judgment will be granted for the defendants on plaintiffs' Sherman Act § 1 and Wilson Tariff Claims concerning television receivers.
VIII. Plaintiffs' Evidence With Respect to Non-Television Products
This case has long been widely known as the "Japanese TV Case," and for good reason. Television receivers are the only products addressed in NUE's complaint, and they are the heart and soul of Zenith's complaint. However, Zenith has also put before us claims concerning a number of other CEP's: radios, tape equipment, phonographs, stereo and audio instruments, and certain components. We shall take up the evidence in the record with respect to each of these products seriatim.
We note preliminarily that Zenith's non-TV product claims do not proceed from any predicate that a predatory export invasion of the U.S. market was funded by a high price home market "war-chesting" conspiracy.
Both Zenith and NUE have alleged that defendants' "unitary" conspiracy began with the commencement of radio exports to the United States from Japan. According to plaintiffs, these exports represented the first "phase" of defendants' joint "stage-by-stage" strategy for taking over the United States CEP industry through "depressed pricing" or "artificially low prices." Notwithstanding the breadth of its claims, Zenith's "evidence" about radios stems from four sources: (1) two MITI-related export control arrangements, which affected the export of certain transistor radios; (2) the existence and alleged activities of certain "export" committees within the EIAJ and the JMEA; (3) the alleged radio-related activities of certain of the sub rosa Japanese domestic groups and associations which we have already described; and (4) inferences sought to be drawn from defendants' low prices on the U.S. market and their sharply increasing market share.
The two export control arrangements which Zenith cites in support of its radio claims are: (1) those we shall refer to as the radio export regulations, which via various extensions were in effect from July 1, 1958 through December 31, 1972; and (2) those we shall refer to as the consumer electronics export regulations, which were in effect from June 8, 1973 to August 31, 1973. These regulations are of the same basic character as those referred to in Part VII.F.1, supra, and our discussion there is applicable here. At various times, the regulations imposed minimum prices, maximum quantity, and customer limitation restrictions on exports of certain kinds of radios to the United States. Additionally, they required radio exporters to register their trademarks and the names of their export customers, established penalties for violation of their restrictions, and created the Radio Export Examination Committee for certain administrative purposes.
The bulk of Zenith's FPS regarding radios is part rescription and part summarization and paraphrasing of the main provisions of the agreements, though there are scattered references to allegedly improper data dissemination.
Aided by the affidavit of Hideo Miyake, Managing Director of Matsushita Electric Trading Company, Ltd. (MET), the Matsushita defendants and others submit that, as with the similar television agreements, the export regulations upon which Zenith relies were established at the express direction of MITI pursuant to the EIT law, were instruments of foreign trade policy of the Japanese government, and as such are not subject to scrutiny under United States law. Moreover, defendants allege, since the minimum price regulations could only have had the effect of keeping prices on radios exported to the United States higher than would otherwise prevail, they are fundamentally inconsistent with Zenith's claim of a "low" price export conspiracy, and could not have caused Zenith any injury. For reasons which have been explained supra, we shall not herein reach the act of state, sovereign compulsion, and international comity issues implicated by defendants' contentions about the role of MITI. And for reasons stated in Parts VI.B. and VII.F, we agree with defendants' contentions as to Zenith's inability to claim injury from the minimum price agreements or export quotas.
Aside from the text of the Manufacturers' Agreements themselves, the only other evidence which Zenith advances in its FPS concerning them are materials which indicate that the JMEA performed certain tasks with respect to the arrangements, such as administering certain aspects and preparing draft regulations under the aegis of MITI.
These facts do not change the result.
As to the EIAJ, as is the case with television receivers, Zenith presents a list of the various EIAJ (radio) committees and argues that it "conveys a sense of the variety of matters which receive joint attention by the defendants" during their EIAJ committee meetings. Three of the committees appear to have had involvement with radios: the Radio Export Committee, the Radio Business Committee, and the Radio Technical Committee of the EIAJ's Kansai Chapter.
Again, however, Zenith attempts to have us draw conspiratorial inferences from the mere names of the committees, from the mere fact that they met, and from the suggestion that the participants "weren't just whistling Dixie" at these meetings (and that defendants have the burden of showing that they were not conspiring). Again, this approach must fail.
It appears from the supporting documents that the principal subjects of discussion at the allegedly offending committee meetings were the check prices and export quotas for radios, along with matters of implementation of the Manufacturers' Agreements. As we have said, those matters do not result in antitrust injury to Zenith. Just as with their TV claims, plaintiffs make broad conclusory statements about conspiratorial activities, such as price fixing, which are not borne out by the documents. However, upon review of the actual documentation, which plaintiffs have not stressed, it appears that plaintiffs' case with respect to radios (and tape and stereo products as well) depends upon evidence of data dissemination which is similar in character to that adduced with respect to television receivers. The documents come from a variety of sources, but mostly from EIAJ committees and sub rosa groups. The principal difference between these and the TV documents is that there is far less "documentation" of the non-TV case. In evidentiary terms, however, the documents are qualitatively no different from those discussed in Parts VII.G.2(b) and (c).
Indeed, we could rescribe here much of what we wrote in section VII.G.2.(b) and (c), but that would be charitable to plaintiffs' radio claims, for the data dissemination evidence referenced in the FPS with respect to radios is far more random than that advanced in plaintiffs' TV case, and is afflicted with the same problems. Plaintiffs make no cohesive presentation, and the evidence would not support one, which justifies a conclusion that there is significant evidence of data dissemination such as would violate the Sherman Act.
Some of the documents contain references to or statistics about radio exports, but those references are not limited to the United States, including instead exports throughout the world. Such references are not probative of plaintiffs' claims. In none of the charts and statistics disseminated through the EIAJ committees or the MD Group is there any evidence of exchange of identifiable price data. As with the TV documents, we have no idea from the radio documents who said what to whom or which company representatives were present and/or voted on any of the proposals, nor do we know whether any of the proposals were implemented, nor the extent of detail exchanged. There has been no deposition taken of anyone present at any such meeting. Plaintiffs attempt to interpret the documents to suit themselves, but they really do not tell us anything. We add that the plaintiffs' age-old argument that the groups and associations provided a "forum for discussion" of the levels of radio production for the Japanese market is unavailing in the absence of any evidence as to conspiratorial activity. See Part VI.A.4, supra.
In their FPS, plaintiffs seek to draw an inference of a low price export conspiracy from: (1) the fact that the Japanese manufacturing defendants sold at such "low" prices in the U.S.; and (2) the high share of the U.S. market which they ultimately acquired.
These arguments track similar claims that plaintiffs have made with respect to television receivers, which we described in Parts VII.K and M, supra. We incorporate by reference what we said therein, and conclude that no inference of conspiracy can be drawn from evidence that defendants charged low prices in the U.S. (actually, plaintiffs have not really advanced a case of "international price discrimination" in radios) or from plaintiffs' evidence concerning the "depletion and destruction" of the U.S. radio industry.
In sum, as was the case with television receivers, Zenith has adduced no evidence, direct or circumstantial, tending to show any agreement among the defendants to sell radios in the U.S. at unreasonably low prices; neither has it adduced evidence of parallel radio pricing. There is no evidence that radios exported by the Japanese defendants were sold in the U.S. below competitive price levels, or below defendants' costs.
During the course of the final summary judgment argument, plaintiffs' lead counsel, Edwin P. Rome, conceded that plaintiffs had "much less" evidence with respect to non-TV products than for TV products. Without commenting here upon the strength of plaintiffs' TV claims, we observe that Mr. Rome made an understatement. He did not supply any details whatever with respect to the radio claims at the final summary judgment argument, and radio claims do not occupy more than a handful of pages in the 1,000 plus pages of plaintiffs' two final summary judgment briefs. In short, Zenith has offered no significant probative evidence, and there is no genuine issue of material fact, with respect to the radio claims. Accordingly, summary judgment must be granted for the defendants with respect to all claims regarding radio products.
B. Tape and Stereo Products
Zenith's claims with respect to tape and stereo products are even weaker and more amorphous than its radio claims, and the FPS contains even less data as to the tape and stereo products claims. Zenith has not even formulated a claim for damages to its tape and stereo business attributable to the alleged conspiracy. Zenith's evidence respecting its tape and stereo claims consists of: (1) the export control arrangements, which for the most part did not even have price provisions; (2) the names and dates of meetings of a few trade association committees; (3) the suggestion that a few of those committees may have discussed export-related subjects based, apparently, upon random reference to the exchange of information concerning tape and stereo products; and (4) the inference Zenith seeks to draw from the increase in sales of defendants' products in the U.S. and the decline of the U.S. industry.
Zenith relies on two MITI-related export control arrangements. The first is the consumer electronics export regulation which also applied to radios, but which, as respects tape and stereo products, was in effect for only eight months in 1973, and which did not contain minimum price provisions (although it did contain export quotas). The second was the "Regulations Providing for the Terms to be Observed by Members of the Association with respect to the Export of Tape Recorders," in effect from May, 1965 through March, 1967. The principal provisions of these regulations were customer and trademark registration requirements similar to those contained in the radio export regulations. They did not contain price or quantitative restrictions or customer limitation provisions the provisions upon which Zenith places such heavy reliance with respect to television receivers.
None of these regulations support Zenith's low price export conspiracy claims. As we have noted, they contain no price provisions. Controlling exports to the United States by requiring exporters to register their trademarks and the names of their U.S. customers (in the case of the tape recorder export regulations) and by export quotas (in the case of the consumer electronics export regulations) could not have injured Zenith, because the only possible effect of such controls would have been to limit exports to the United States. As a competitor, Zenith could not have been hurt thereby. See discussion at Parts VI.B. and VII.F, supra.
Zenith also offers a potpourri of other materials in support of its tape and stereo claims. It invokes defendants' interrogatory answers to acknowledge the existence of certain EIAJ committees which have names suggesting an interest in tape and/or stereo products. However, a review of the documents themselves referable to those committees reveals that they are not probative of a low price export conspiracy. As in the case of JMEA committees, the conferees primarily discussed the MITI-related export regulations. The documents also reflect discussion of matters such as export inspection, compliance with the quality control provisions of the tape recorder export regulations, discussion of export trends, etc., but, for reasons explained several times, supra, none of these matters are circumstantial evidence of the "unitary" conspiracy.
The minutes of the EIAJ Stereo Advertising Committee, the Stereo Summit Committee of the EIAJ, and the Audio Technical Committee of the Kansai Chapter of the EIAJ contain no export references at all. The materials produced by defendants with respect to these committees reflect discussion of such matters as: the definition and use of words employed by various manufacturers or dealers in stereo advertisements; voluntary restraint on advertisements; discussion of the regular matrix system and standardization of the RM method of technology; a report of a study by the Four Channel Stereo Research Committee; changes in the degree of stereo signals; reports on safety, etc. Applying the legal standards discussed above, none of these matters give rise to the conspiratorial inference sought by plaintiffs.
There are random references suggesting exchange of production, shipment, and inventory statistics and demand forecasts with respect to tape and stereo equipment in a number of MD Group and EIAJ documents, including those generated by the Kansai Chapter. Zenith's submissions in this regard come from documents not proffered as DSS's during the pretrial evidentiary hearings. All of them suffer from precisely the same flaws as the materials excluded in the Japanese Materials Evidentiary Opinion, and plaintiffs have done nothing to validate them. However, even if they were admissible, they would not help Zenith, because they contain no indication of discussions relating to exports to the United States or to pricing in any market. They contain no identifiable price detail and no individual company statistics about anything. What we said about data dissemination in our discussion of plaintiffs' radio claims applies here.
The documents are not suggestive in any wise of the existence of a conspiracy. The random allusions to "voting" do not even begin to approach, either quantitatively or qualitatively, what we found was inadequate in the case of TV receivers, and certainly do not approach the level of "significant probative evidence" of conspiracy.
As was the case with radios, plaintiffs advance impressive statistics as to the increase in sales of Japanese tape and stereo products in the U.S. and the contemporaneous decline in U.S. industry. They also suggest that the defendants sold at low prices in the U.S. We have already explained that such evidence, even if properly presented, does not give rise to an inference of conspiracy. See Parts VII.M and VII.K, supra.
Again with respect to tape and stereo products, plaintiffs have adduced no evidence of an agreement among the defendants to sell at unreasonably low prices in the U.S., no evidence of parallel pricing in the U.S., no evidence of pricing below competitive levels, and no evidence of pricing below cost. Zenith has not been serious in advancing its tape and stereo claims, at least not serious enough to produce any significant probative evidence to support them. Summary judgment must be granted with respect thereto.
C. Components; The Alleged Matsushita-Philips Component Complex and International "Industrial Cooperation" System
Zenith's claims with respect to components are even weaker, if that is possible, than its claims with respect to other non-TV products. Initially, consistent with its other claims, Zenith alleges an agreement among Japanese component manufacturers to export components to the United States at artificially depressed pricing levels. On the other hand and this appears to be the main thrust of its components theory Zenith asserts that two of the participants in the alleged low price conspiracy, MEI and N.V. Philips Gloeilampenfabrieken (Philips), had an arrangement pursuant to which defendant MEC, their joint venture engaged in component manufacturing, sold components to Zenith at discriminatorily high prices at least at 15% higher than the special discount at which they were sold to MEI. This is of course inconsistent with the tenor of plaintiffs' main case. Also invoking certain agreements and meetings between MEI and Philips to "cooperate" in various matters, plaintiffs submit that the MEI-Philips arrangements are part of the overall conspiracy.
The inconsistency of Zenith's theories is highlighted when we consider that, in connection with components, Zenith is not a seller but a purchaser. The only components that Zenith sold in any significant quantity during the period relevant to this litigation were monochrome and color picture tubes. Zenith no longer has any viable claims as a seller of components, i. e., as a competitor of defendants. Its dumping claims with respect to components, which were the only claims asserted as a competing seller, were dismissed some time ago for failure to provide dumping comparisons.
Moreover, Zenith makes no Robinson-Patman Act claims as a seller of components.
However, we nonetheless turn to an examination of the evidence affecting Zenith's components claims, starting with its conventional (depressed pricing) theory.
Zenith originally claimed that nine categories of components were relevant to the case:
(2) Coils, deflection yokes, and transformers;
(3) Resistors, varistors, and thermistors;