475 U.S. 574, 590 (1986)
Zenith Radio Corporation and National Union Electric Corporation, American manufacturers of television sets, commenced this action in 1974 against twenty-one Japanese corporations and Japanese-controlled American corporations that manufacture and sell consumer electronic products, primarily television sets.1
The suit alleged that the defendants had engaged in a conspiracy beginning as early as 1953.2 The conspiracy aimed to fix and maintain high prices for television sets sold in Japan.3 At the same time, the defendants fixed and maintained low prices for sets exported to and sold in the United States.4 National Union Electric Corporation is the corporate successor to Emerson Radio Company, which withdrew from the television market in 1970 after incurring substantial losses.5
After several years of detailed discovery, the defendants moved for summary judgment.6 The District Court directed the parties to file final pretrial statements listing all documentary evidence that would be offered at trial.7 In three detailed opinions, the District Court ruled that the bulk of the evidence on which the plaintiffs relied was inadmissible.8
In a subsequent 217-page opinion, the District Court found that the admissible evidence did not raise a genuine issue of material fact as to the existence of the alleged conspiracy.9 The court granted summary judgment in favor of the defendants.10 The Court of Appeals for the Third Circuit reversed the District Court's judgment after determining that much of the excluded evidence was admissible.11 Based on the enlarged record, the Court of Appeals concluded that there was both direct and circumstantial evidence from which a reasonable factfinder could find a conspiracy to depress prices in the American market, funded by excess profits obtained in the Japanese market.12
The Supreme Court granted certiorari to review whether the Court of Appeals had applied proper standards in evaluating the District Court's summary judgment decision.13
Whether the Court of Appeals applied the proper standards in evaluating the District Court's decision to grant petitioners' motion for summary judgment?14
To survive a motion for summary judgment in a Sherman Act section 1 conspiracy case, a plaintiff must present evidence that tends to exclude the possibility that the alleged conspirators acted independently.15 If the factual context renders the claim implausible because it makes no economic sense, the plaintiff must offer more persuasive evidence than would otherwise be necessary.16
No. Zenith Radio Corporation and National Union Electric Corporation, American manufacturers of television sets, commenced this action in 1974 against twenty-one Japanese corporations and Japanese-controlled American corporations that manufacture and sell consumer electronic products, primarily television sets.
The Court of Appeals erred by treating evidence of price fixing in Japan, the five company rule, and check prices as direct evidence supporting a predatory pricing conspiracy in the United States.17 That evidence had little relevance to a claim of below-cost pricing over two decades.18 The alleged conspiracy was economically implausible because petitioners would have had to sustain substantial losses without any realistic prospect of recouping them through monopoly prices, as RCA and Zenith continued to hold the largest market shares.19 In the absence of a plausible motive, the evidence of parallel conduct and other arrangements did not tend to exclude independent action and therefore created no genuine issue for trial under Federal Rule of Civil Procedure 56(e).20
The Court of Appeals did not apply the proper standards in evaluating the District Court's decision to grant summary judgment.21
Related opinions on this issue
Joined by Justices Brennan, Blackmun, And Stevens
Justice White dissented on the ground that the Court of Appeals faithfully followed Cities Service and Monsanto and correctly held that the evidence as a whole created a genuine issue of material fact.22 He argued that the majority improperly invaded the factfinder's province by deciding for itself that the conspiracy was implausible.23 He also argued that the majority discounted the DePodwin Report, which created triable issues concerning harm to respondents from Japanese cartelization and from agreements restricting competition among petitioners in the United States.24
Justice White would have affirmed the judgment of the Court of Appeals and remanded the case for trial.25
Whether petitioners could be held liable under the antitrust laws for a conspiracy in part compelled by a foreign sovereign?26
The Court did not reach the sovereign compulsion issue.27
No. The Court did not reach this issue.28
Because the decision on the first issue required reversal of the Court of Appeals and reinstatement of summary judgment, the question whether petitioners could be held liable for conduct in part compelled by Japan's Ministry of International Trade and Industry became unnecessary to decide.29
The Court did not reach the sovereign compulsion issue.