Not a Lexis Advance subscriber? Try it out for free.

Prof'l Real Estate Investors, Inc. v. Columbia Pictures Indus.

Supreme Court of the United States

November 2, 1992, Argued ; May 3, 1993, Decided

No. 91-1043

Opinion

 [1642]   [*51]  [***618]  [**1923]    JUSTICE THOMAS delivered the opinion of the Court.

 This case requires us to define the "sham" exception to the doctrine of antitrust immunity first identified in Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127, 5 L. Ed. 2d 464, 81 S. Ct. 523 (1961), as that doctrine applies in the litigation context. ] Under the sham exception, activity "ostensibly directed toward influencing governmental action" does not qualify for Noerr immunity if it "is a mere sham to cover . . . an attempt to interfere directly with the business relationships [****7]  of a competitor." Id., at 144. We hold that ] litigation cannot be deprived of immunity as a sham unless the litigation is objectively baseless. The Court of Appeals for the Ninth Circuit refused to characterize as sham a lawsuit that the antitrust defendant admittedly had probable cause to institute. We affirm.

Petitioners Professional Real Estate Investors, Inc., and Kenneth F. Irwin (collectively, PRE) operated La Mancha Private Club and Villas, a resort hotel in Palm Springs, California. Having installed videodisc players in the resort's hotel rooms and assembled a library of more than 200 motion picture titles, PRE rented videodiscs to guests for in-room  [*52]  viewing. PRE also sought to develop a market for the sale of videodisc players to other hotels wishing to offer in-room viewing of prerecorded material. Respondents, Columbia Pictures Industries, Inc., and seven other major motion picture studios (collectively, Columbia), held copyrights to the motion pictures recorded on the videodiscs that PRE purchased. Columbia also licensed the transmission of copyrighted [****8]  motion pictures to hotel rooms through a wired cable system called Spectradyne. PRE therefore competed with Columbia not only for the viewing market at La Mancha but also for the broader market for in-room entertainment services in hotels.

 [1643]  In 1983, Columbia sued PRE for alleged copyright infringement through the rental of videodiscs for viewing in hotel rooms. PRE  [**1924]  counterclaimed, charging Columbia with violations of §§ 1 and 2 of the Sherman Act, 26 Stat. 209, as amended, 15 U.S.C. §§ 1-2, 2 and various state-law infractions. In particular, PRE alleged that Columbia's copyright action was a mere sham that cloaked underlying acts of monopolization and conspiracy to restrain trade.

Read The Full CaseNot a Lexis Advance subscriber? Try it out for free.

Full case includes Shepard's, Headnotes, Legal Analytics from Lex Machina, and more.

508 U.S. 49 *; 113 S. Ct. 1920 **; 123 L. Ed. 2d 611 ***; 1993 U.S. LEXIS 3121 ****; 26 U.S.P.Q.2D (BNA) 1641; 61 U.S.L.W. 4450; Copy. L. Rep. (CCH) P27,089; 1993-1 Trade Cas. (CCH) P70,207; 93 Cal. Daily Op. Service 3198; 93 Daily Journal DAR 5465; 7 Fla. L. Weekly Fed. S 223

PROFESSIONAL REAL ESTATE INVESTORS, INC., ET AL., PETITIONERS v. COLUMBIA PICTURES INDUSTRIES, INC., ET AL.

Prior History:  [****1]  ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT.

Disposition: 944 F. 2d 1525, affirmed.

CORE TERMS

sham, lawsuit, antitrust, competitor, immunity, probable cause, anticompetitive, baseless, genuine, sham exception, courts, merits, cases, judicial process, infringement, motivation, objectively reasonable, government action, summary judgment, lobbying, copyright infringement, realistically, proceedings, videodiscs, anti trust law, Sherman Act, motion picture, unsuccessful, allegations, repetitive

Antitrust & Trade Law, Exemptions & Immunities, Noerr-Pennington Doctrine, General Overview, Regulated Industries, Transportation, Monopolies & Monopolization, Conspiracy to Monopolize, Sherman Act, Criminal Law & Procedure, Inchoate Crimes, Conspiracy, Elements, Attempts to Monopolize, Sherman Act, Penalties, Copyright Law, Civil Infringement Actions, Summary Judgment, Scope, Exemptions, Railroads, Labor & Employment Law, Collective Bargaining & Labor Relations, Unfair Labor Practices, Higher Education & Professional Associations, Colleges & Universities, Regulated Practices, Price Fixing & Restraints of Trade, Evidence, Inferences & Presumptions, Civil Procedure, Entitlement as Matter of Law, Genuine Disputes, Torts, Elements, Lack of Probable Cause, Determinations of Probable Cause