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Republic Tobacco Co. v. N. Atl. Trading Co.

United States Court of Appeals for the Seventh Circuit

June 17, 2004, Argued ; September 1, 2004, Decided

Nos. 04-1098 & 04-1202

Opinion

 [*721]  FLAUM, Chief Judge. This appeal involves the claims that two competing tobacco companies brought against one another -- one company suing for violation of antitrust laws, the other for defamation. North Atlantic Trading Co., Inc. ("North Atlantic") was upset when its efforts to engage new markets for its cigarette papers proved unsuccessful. It blamed its difficulties in cultivating new customers on the business practices of its competitor, Republic Tobacco Company ("Republic") and decided to sue. The hard feelings went both ways -- Republic became upset with North Atlantic after North Atlantic criticized Republic's business practices in two letters sent to customers. Claiming that it had been defamed (among other things), Republic also decided to sue.

The parties' dueling lawsuits were eventually consolidated into one case before the United States District Court for the Northern District of Illinois. At summary judgment, the district court considered [**2]  both parties' multiple claims and counterclaims -- the only one to survive being Republic's defamation claim. Not only did it advance; it was successful at summary judgment. Following this judgment, a  [*722]  jury trial was held on the issue of damages, both presumed and punitive, for the defamation claim. The jury returned a verdict for $ 8.4 million in presumed damages and $ 10.2 million in punitive damages. The trial court granted North Atlantic's subsequent motion for remittitur, reducing the awards to $ 3.36 million and $ 4.08 million, respectively.

On appeal, North Atlantic seeks review of: (1) the district court's decision to grant summary judgment to Republic on its defamation claim; (2) the remitted damage awards; and (3) the district court's decision to grant summary judgment to Republic on North Atlantic's antitrust claims. Republic cross-appeals the district court's refusal to entertain a procedure that might have enabled Republic to appeal the remittitur. For the reasons stated in this opinion, we affirm the district court's decisions with respect to Republic's defamation claim, North Atlantic's antitrust claims, and Republic's cross-appeal. On the issue of damages, we vacate [**3]  the district court's award of presumed and punitive damages, and award to Republic $ 1 million in presumed damages and $ 2 million in punitive damages.

I. Background

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381 F.3d 717 *; 2004 U.S. App. LEXIS 18470 **; 2004-2 Trade Cas. (CCH) P74,531

REPUBLIC TOBACCO CO., Plaintiff-Appellee/Cross-Appellant, v. NORTH ATLANTIC TRADING COMPANY, INC., et al., Defendants-Appellants/Cross-Appellees.

Subsequent History: Motion granted by Republic Tobacco, L.P. v. N. Atl. Trading Co., 2005 U.S. Dist. LEXIS 16223 (N.D. Ill., Aug. 3, 2005)

Prior History:  [**1]  Appeals from the United States District Court for the Northern District of Illinois, Eastern Division. No. 98 C 4011. John F. Grady, Judge.

Republic Tobacco, L.P. v. N. Atl. Trading Co., 2003 U.S. Dist. LEXIS 21153 (N.D. Ill., Nov. 20, 2003)Republic Tobacco, L.P. v. N. Atl. Trading Co., 254 F. Supp. 2d 985, 2002 U.S. Dist. LEXIS 6150 (N.D. Ill., 2002)

Disposition: District court's grant of summary judgment on Republic's defamation claim and North Atlantic's antitrust claims affirmed. District court's remitted damages award order vacated.

CORE TERMS

district court, presumed, damages, customers, punitive damages, defamation, products, defamatory, Toys, lawsuit, geographic, Tobacco, boxes, cigarette paper, actual malice, wholesalers, innocent, contends, display, summary judgment, remittitur, remitted, argues, incentive program, Southeast, Dentists, defamatory statement, relevant market, distributors, antitrust

Civil Procedure, Appeals, Standards of Review, De Novo Review, Summary Judgment Review, General Overview, Standards of Review, Torts, Defamation, Elements, Intentional Torts, Defamation Per Se, Procedural Matters, Defenses, Privileges, Fair Comment & Opinion, Truth, Constitutional Law, Freedom of Speech, Constitutional Privileges, Bill of Rights, Fundamental Freedoms, Public Figures, Public Figures, Voluntary Public Figures, Appealability, Reviewability of Lower Court Decisions, Preservation for Review, Criminal Law & Procedure, Juries & Jurors, Province of Court & Jury, Sentencing Issues, Preliminary Considerations, Federal & State Interrelationships, Erie Doctrine, Abuse of Discretion, Relief From Judgments, Additur & Remittitur, Remittiturs, Remands, Remedies, Damages, Types of Damages, Punitive Damages, Punitive Damages, Measurement of Damages, Determinative Factors, Judicial Review, Antitrust & Trade Law, Market Definition, Relevant Market, Geographic Market Definition, Healthcare Law, Business Administration & Organization, Covenants not to Compete, Regulated Practices, Price Fixing & Restraints of Trade, Horizontal Market Allocation, Cartels & Horizontal Restraints, Vertical Restraints, Relevant Market