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VIM, INC. v. SOMERSET HOTEL ASS'N

September 10, 1998

VIM, INC, f/k/a VIRGINIA INN MANAGEMENT, INC. et al., Plaintiffs,
v.
SOMERSET HOTEL ASSOCIATION, et al., Defendants



The opinion of the court was delivered by: SMITH

MEMORANDUM OPINION AND ORDER

 D. Brooks Smith, District Judge.

 This is an antitrust case in which plaintiffs, who wished to and ultimately did build and operate a Hampton Inn hotel in Somerset, Pennsylvania, have sued various defendants who operated existing, competing hotels in that city. The gravamen of plaintiffs' claims is that defendants, through the use of a trade group known as the Somerset Hotel Association, conspired to impede the construction of the Hampton Inn by interposing patently meritless legal challenges to plaintiffs' positions before Somerset Borough's zoning and planning commissions, and before the courts. Defendants have responded with motions for summary judgment, asserting that the Noerr-Pennington doctrine insulates their conduct from antitrust attack, regardless of its motivation. Because the undisputed facts of record demonstrate that defendants' legal challenges were not objectively baseless as contemplated by Professional Real Estate Investors, Inc. v. Columbia Pictures Indus., Inc., 508 U.S. 49, 123 L. Ed. 2d 611, 113 S. Ct. 1920 (1993), I will grant the motions and enter summary judgment for defendants.

 I.

 The material facts, viewed in the light most favorable to plaintiffs, are as follows. In January 1995, Virginia Inn Management ("VIM") contracted to purchase a parcel of land adjacent to an existing truck stop located just off the Somerset Turnpike exit; on this property they hoped to construct their Hampton Inn. Dkt. no. 51, Exh. 1. This tract of land then served as extra parking space for the truck facility and was zoned such that a hotel could be build upon it. *fn1" The design of VIM's Hampton Inn, however, was such that a special height exception would have to be obtained from the zoning board, in addition to a general site plan approval from the planning commission.

 VIM's proposed hotel was to be the first major overnight lodging facility built in Somerset in many years. As such, it was viewed with no small amount of consternation by its competitors, who in response, formed the Somerset Hotel Association to represent their common interests. Id., Exh's 3-4. The association decided to send representatives to the public meetings and hearings concerning the proposed Hampton Inn, expressing opposition to the project. Id., Exh. 7.

 The first of these hearings occurred on April 4, 1995 before the Somerset Zoning Hearing Board. See id., Exh. 12. VIM's proposed design height for its five-story Hampton Inn was fifty-five feet, ten feet higher and two more floors than normally permitted under the local zoning ordinance. Id. at 5; see also id., Exh. 11, at 6 (table). That ordinance, however, provided for a special height exception to be granted upon a showing by VIM that the extra height would not "substantially affect adversely the uses of adjacent and neighboring property." Id, Art. 12, § 4.

 At the zoning hearing, VIM's counsel put evidence on the record that was intended to show that the extra ten feet would not adversely affect adjoining properties. This evidence took the form of a plan view of the site, photographs of other Hampton Inns, testimony from two engineers retained by VIM, and the testimony of the owner of the truck stop (who was also the seller of the land). Id. Exh. 12, at 3-12, 16-22. VIM, however, did not perform any property-by-property analysis of how its proposed use would affect the views and signage of the adjoining businesses, nor did it provide any front, rear or side elevation drawings of the proposed hotel. See id. at 44-53.

 For their part, defendants offered no evidence that the extra building height would adversely affect the uses of their properties, or, for that matter, on any other issue. Instead they argued concerning the increase in vehicle traffic that they believed would accompany the new Hampton Inn, and the possibility, feared by local business owners, that the Pennsylvania Turnpike Commission would consider relocating the Somerset interchange should there be an increase in congestion and vehicular accidents. Id. at 22-26, 31-32. Defendants then moved to continue the proceedings while they developed their rebuttal evidence. Id. at 47-50.

 Defendants' objections, although vociferous, went to the issue of whether a hotel should be permitted to be built at the site vel non, not whether an extra ten feet in its height would adversely affect their properties. Because VIM had the right, under the zoning ordinance, to build a hotel on the site, defendants' contentions were immaterial to the board's decision, and the borough solicitor so informed the board members at the hearing. Thus, the board voted, 3-1, to grant the special exception, with one member dissenting because she felt that VIM's evidence was insufficient to give her a sense of how the hotel would affect the surrounding properties. Id. at 53, 65. No action was taken on the motion for continuance.

 On May 2, 1995, defendant Somerset Hotel Association filed a land use appeal in the court of common pleas challenging the zoning board's decision to grant the special height exception. Id., Exh. 33. One basis of this appeal was that VIM had failed to come forward with sufficient evidence that its hotel's additional ten feet in height would not have an adverse effect on the adjoining property owners. Id.

 On May 25, the Somerset Borough Planning Commission held a public meeting to consider VIM's proposed site plan for its hotel. Id., Exh. 32. Again, defendants argued, without presenting evidence, that the hotel would increase traffic around the Somerset interchange, and that approval be delayed until a traffic study could be conducted, as previously requested by the Turnpike Commission. Id. In this proceeding, however, the zoning ordinance required the planning commission to examine the project's effect on internal and external traffic patterns in making its determination whether to approve the site plan. Dkt. no. 46, Exh. B., §§ 4(1)(e), 4(3). Nevertheless, the borough solicitor instructed the commissioners that they could not legally require a traffic impact study or consider any traffic effects beyond the borders of the site itself. Dkt. no. 51, Exh. 32. The commission accordingly approved the site plan, contingent on the appeal of the zoning exception being resolved in VIM's favor. Id. Defendants appealed this decision to the court of common pleas as well.

 Both appeals were consolidated and on August 22, 1995, defendants filed motions to open the record and present additional evidence, although initially defendants had no offer of proof in support of the motions. See id., Exh. 35, at 3, 39. Eventually, however, defendants' evidence was confined solely to the position of the Turnpike Commission (expressed by one of its officials) that traffic around the Somerset interchange was a real concern. Id. at 44-45. This default, combined with the fact that the evidence was available to defendants at the time of the planning commission hearing, led the motions judge to decline to open the record, without prejudice. Id., Exh. 36.

 Thus, both appeals proceeded on their merits, the zoning appeal on the theory that VIM had failed to produce sufficient evidence that its hotel's extra height would not adversely affect neighboring properties, and the planning appeal on the contention that the commission improperly failed to comply with the ordinance's requirement that the hotel's effect on external traffic patterns be considered. Defendants renewed their motion to open the record, but their proposed witness, a representative of the Turnpike Commission, would have testified only that the Commission thought that a traffic study should be performed, but not that the Turnpike Commission had the power to require a study or otherwise delay the project. Id., Exh. 39, at 50. Given this limited testimony, defendants ultimately decided not to even offer it. See id. at 50. On October 4, 1995, the court denied both appeals, Id., Exh. 40; defendants did not appeal to the Commonwealth Court.

 As a result of defendants' ultimately unfounded opposition to the Hampton Inn project, defendants were unable to begin construction by the time winter set in in 1995, and were forced to wait until the Spring of 1996. Id., Exh. 20. Plaintiffs estimate that they were delayed a total of 228 days because of the actions of the defendants. Id.

 Plaintiffs filed suit on April 2, 1996, alleging that defendants engaged in an antitrust conspiracy in violation of the Sherman Act, as well as civil conspiracy, wrongful use of civil process, abuse of process and intentional interference with contractual and prospective business relationships under state law. Dkt. no. 1. On March 27, 1997, I denied defendants' motions to dismiss the complaint under Fed. R. Civ. P. 12(b)(6), dkt. no. 27. Answers and ...


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