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GREENE CTY. MEM. PARK v. BEHM FUNERAL HOMES

July 7, 1992

GREENE COUNTY MEMORIAL PARK, a corporation; GREENE COUNTY MONUMENT AND VAULT COMPANY, a corporation, Plaintiffs,
v.
BEHM FUNERAL HOMES, INC., a corporation; FRANK J. BEHM, an individual; FRANK C. "CHUCK" BEHM, an individual; PEGGY BEHM, an individual; GREGORY ROHANNA, an individual; GORDON GREENLEE, an individual; BARRET GREENLEE, an individual; PAUL M. LESAKO, an individual; SAMUEL A. MILLIKEN, an individual; and DARRYL THROCKMORTEN, an individual, Defendants.



The opinion of the court was delivered by: COHILL

 COHILL, D.J.

 This case involves allegations of unlawful tying arrangements and boycotts under the Sherman and Clayton Anti-trust Acts, 15 U.S.C. sections 1 and 14 respectively, and tortious interference with contractual relations under Pennsylvania law. Before this Court are cross motions for summary judgement filed by the plaintiffs and jointly by all the defendants; a separate Motion for Summary Judgment was also filed by Peggy Behm.

 For the following reasons, we will deny the plaintiffs' summary judgment motion, and grant the defendants' summary judgment motion. We will also grant defendant Peggy Behm's separate motion for summary judgment. All motions not addressed by this Opinion are moot.

 I. FACTS

 The plaintiffs in this action are Greene County Memorial Park (the "Park"), a Pennsylvania corporation which owns and operates a cemetery in Greene County, Pennsylvania, and Greene County Monument and Vault Company (the "Vault Company"), a Pennsylvania corporation engaged in the business of selling burial vaults and grave markers. The Park and Vault Company were, at all times relevant to this opinion, owned and operated by Jeanne and Challen Waychoff.

 The Park has sold burial plots and grave markers since 1930. C. Waychoff deposition at 23-24, 449. In 1984 it began selling burial vaults and mausoleum crypts as well. Id. at 13; Plaintiff's Response to Behm's First Set of Interrogatories No.9. In October, 1986, the Park began selling a product which served as both a casket and a vault called "Chapel Vault," and in October, 1987, the Park began selling caskets. Plaintiff's Response to Behm's First Set of Interrogatories Nos. 1,6,9.

 The Vault Company was incorporated in October, 1984 to sell monuments and to purchase vaults for resale to the Park. Id.; C.Waychoff Dep. at 437,440. The Vault Company eventually stopped selling vaults to the Park when the Park began to buy directly from vault manufacturers. J.Waychoff Dep. at 17-18, 20-21.

 In addition to providing funeral services, the Funeral Directors also sell caskets, vaults and monuments. They belong to several professional organizations including the Pennsylvania Funeral Directors Association ("PFDA") and the Green County Funeral Directors Association ("GCFDA"). It was during meetings of these organizations that the plaintiffs claim the defendants conspired to adopt the various illegal, anti-competitive practices and policies listed below in an effort to eliminate the Park as a competitor in the sale of caskets and burial vaults. These actions, the plaintiffs allege, are in violation of the Sherman and Clayton antitrust laws.

 1. Advertisements

 During two meetings of the GCFDA in 1986 and 1987, several members, including the Funeral Directors, agreed to publish certain advertisements in local newspapers. One, which was published by defendants Samuel Milliken, Daryl Throckmorton, Frank J. Behm, Frank C. Behm and Gregory Rohanna, was entitled "Care Concern and Compassion." Although the content of these advertisements varied slightly, they all warned consumers of "out-of-town salespersons" selling vaults and caskets. According to Frank J. Behm, the advertisements were directed at Tri-County Funeral Association, a company from Allegheny County, Pennsylvania, which sold vaults and caskets by door-to-door salesmen in Allegheny, Greene, Washington and Fayette counties. F.J. Behm Dep. at 74,75,79-83; see also G.Greenlee Dep. at 28,29. The advertisements placed by Frank J. Behm, Frank C. Behm and Gregory Rohanna included the following statement:

 Before you open your phone line or your door to one of these salespeople, call your local funeral director for background information. If you choose to speak with a salesperson, we urge you to use caution. They are only offering to sell you a casket and a vault for future use. This package does not include your funeral services. They may use a "special savings certificate" as an enticement. We urge you to contact your funeral director and Social Security office to discuss this certificate. The salesperson will probably tell you that the casket and the vault that they are selling today will gladly be accepted by any funeral director in the future. This is not so! They will finally tell you that they can save you thousands of dollars when you deal through them. This is absolutely untrue!

 Exhibit 1 to F.J. Behm Dep; Exhibit 24 to Defendants' Motion for Summary Judgment.

 Challen Waychoff testified at his deposition that none of these advertisements contained false statements of fact, disparaged the plaintiffs or their products, or caused any of the plaintiffs' customers to cancel contracts. C. Waychoff Dep. at 509.

 2. Statements to Plaintiffs

 The plaintiffs also allege that the defendants made various statements to them which evidence the defendants' conspiracy to drive the Park out of business. They allege that defendant Gordon Greenlee stated to Challen Waychoff in February, 1984, that the funeral directors had always fought among each other and now that Challen Waychoff was competing against them by selling caskets, they were going to have to get together to see what they could do about the Waychoffs. C. Waychoff Dep. at 264. Then, in July, 1986, defendant Paul Lesako told Jeanne Waychoff that he was going to stop purchasing vaults from the Park because he heard at a meeting of the GCFDA that Park was selling caskets. C. Waychoff Dep. at 266; Complaint PP 17-22.

 3. casket Handling Fees and Price Fixing

 It is undisputed that some of the funeral directors impose on customers who purchase caskets from others so called "casket handling fees." The plaintiffs contend that these casket handling fees are designed to thwart competition and allow the defendants to recover profits lost when customers purchase caskets elsewhere. Plaintiffs' Brief in Support of Summary Judgment at 5. The plaintiffs claim that the defendants practice of charging a casket handling fee constitutes an illegal tying arrangement, intended to drive third party casket sellers out of business.

 The defendants contend that casket handling fees are designed to recover the costs which funeral directors incur when handling caskets purchased from third party vendors and are condoned by the Federal Trade Commission. See, FTC Opinion letter dated 3/10/88, Exhibit 21 to Defendant's Motion for Summary Judgment. In addition the Park imposed its own casket handling fees when customers purchased caskets and vaults from others. Defendants' Brief in Support of Summary Judgment at 12,13.

 The plaintiffs respond that the FTC allows only reasonable casket handling fees, and that it is clear from the FTC letter to which the defendants refer that any action taken to discourage or halt third party sales of caskets is a violation of FTC regulations. Plaintiffs' Brief in Response to Defendants' Motion for Summary Judgment at 25.

 The plaintiffs also allege that at meetings of the GCFDA and the PFDA the defendants exchanged pricing information in furtherance of a conspiracy to fix prices for funeral services and products. Plaintiffs' Memorandum in Opposition to Defendants' Motion for Summary Judgment at 16-19. In support of this contention, the plaintiffs offer evidence that the PFDA circulated an anonymous pricing survey among its members in 1989 (to which only one of the defendants responded), and evidence that Frank J. Behm gave talks at PFDA meetings concerning "proper pricing" of funeral services to recover costs incurred when handling third party caskets. Id; Plaintiffs' Brief in Support of Summary Judgment at 15-19; F.J. Behm Dep. Ex. 18.

 4. Attempts to Hire Away the Park's Employees and Interfere with the Park's Contracts

 In furtherance of the defendants' scheme to drive the Park out of business, the plaintiffs allege that defendants Frank J. Behm, Frank C. Behm and Paul Lesako attempted to hire employees away from the Park and interfere with its contracts with customers. Complaint PP 23,25. Although the plaintiffs fail to direct the Court to specific evidence in support of these allegations, we found that the Waychoffs testified during oral deposition that an associate of Paul Lesako's named Mr. Martin told a Park employee named Eli Granus that he would starve to death working for Challen Waychoff and asked him how he made a living. C. Waychoff Dep. at 326. The Waychoffs also testified that Mr. Milliken and Mr. Throckmorton asked another employee of the Park why he would work there. Id.; J. Waychoff Dep. at 151. This is the only evidence the Court has discovered relating to the plaintiffs' allegations that as part of their conspiracy to drive the Park out business, the defendants attempted to hire away the Park's employees.

 As with their allegations that the defendants attempted to hire away their employees, the plaintiffs fail to direct the Court to evidence in support of their allegations that the defendants interfered with the Park's contractual relations with its customers. Again the Court has identified through its independent review of deposition testimony five instances where the plaintiffs allege that the defendants interfered with the Park's contracts with its customers for the sale of caskets or vaults. See C. Waychoff Dep. at 274-75, 326-27; J. Waychoff Dep. at 206. The Waychoffs allege that several customers who planned on purchasing vaults or caskets from the Park changed their minds after talking to the Funeral Directors. The plaintiffs offer no evidence concerning the reasons these customers changed their plans after talking with defendants or what the defendants said to them.

 The plaintiffs allege that the defendants' conduct outlined above constitutes a conspiracy to drive the Park and other third party casket sellers out of business by interfering with the Park's current and prospective contractual relations, attempting to hire away its employees, fixing prices, tying the sale of their funeral services to the sale of their caskets and vaults, and by placing group advertisements attacking third party casket sellers. The plaintiffs suggest that these activities are proscribed by section 3 of the Clayton Antitrust Act and section 1 of the Sherman Antitrust Act. 15 U.S.C. ยงยง 14, 1. After outlining the standard we must apply in evaluating summary judgment motions we will address the merits of the plaintiffs' motion for partial summary judgment and then discuss the defendants' motions.

 II. SUMMARY JUDGMENT STANDARD

 Federal Rule of Civil Procedure 56(c) states that summary judgment shall be granted forthwith "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law."

 when confronted with a motion for summary judgment, it is not the court's function to weigh the evidence and determine the truth of the matter, rather, it is the court's job to decide whether there is a genuine issue for trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). An issue is genuine only if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson, 477 U.S. at 248.

 The moving party has the burden to identify those portions of pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). The nonmoving party then must go beyond the pleadings and by affidavits, depositions, answers to interrogatories, and admissions on file, designate facts showing that there is a genuine issue for trial. Celotex, 477 U.S. at 324. As the Supreme Court stated in Celotex Corp. v. Catrett:

 In our view, the plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial. In such a situation, there can be "no genuine issue as to any material fact," since a complete failure of proof ...


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