Douglas K. Knutson v. The Daily Review, Inc., a Corporation, the Daily Review, Inc., a Corporation v. Douglas K. Knutson

548 F.2d 795 1976-2 Trade Cases 61,196 , 2 Media L. Rep. 1376 Douglas K. KNUTSON et al., Plaintiffs-Appellants, v. The DAILY REVIEW, INC., a corporation, et al., Defendants-Appellees. The DAILY REVIEW, INC., a corporation, et al., Defendants-Appellants, v. Douglas K. KNUTSON et al., Plaintiffs-Appellees. Nos. 74-2802, 74-3423. United States Court of Appeals, Ninth Circuit. Dec. 2, 1976. Rehearing Denied Dec. 30, 1976. Rehearing and Rehearing En Banc Denied Feb. 8, 1977. Timothy H. Fine (argued), San Francisco, Cal., for appellants/cross-appellees. Michael N. Khourie (argued), of Broad, Khourie & Schultz, San Francisco, Cal., for appellees/cross-appellants. Before MERRILL and HUFSTEDLER, Circuit Judges, and SMITH, * District Judge. HUFSTEDLER, Circuit Judge: 1 The appeals and cross-appeals in this case present a potpourri of antitrust problems in the context of a newspaper distribution system before and after the publishers' conversion of the system from independent dealer-distributors to employers of the newspaper publishers. 2 We first identify the dramatis personae : All the plaintiffs are independent distributors of the newspapers published by Daily Review, Inc. ("DRI").…

The appeals and cross-appeals in this case present a potpourri of antitrust problems in the context of a newspaper distribution system before and after the publishers’ conversion of the system from independent dealer-distributors to employers of the newspaper publishers.

We first identify the dramatis personae : All the plaintiffs are independent distributors of the newspapers published by Daily Review, Inc. (“DRI”). Defendants are two corporations and individual officers or employees of those corporations. DRI pub *800 lishes The Daily Review a daily afternoon newspaper; The Argus, a daily morning paper; and The Daily Review Shopping News, a “throwaway” advertising circular. Bay Area Publishing Company (“BAPCO”) publishes the Tri-Valley Herald, a daily morning paper; and the Tri-Valley News, a three day per week, controlled circulation afternoon paper. BAPCO is a wholly-owned subsidiary of DRI. The individual defendants are Floyd L. Sparks, William Chilcote, Dallas Cleland and John Clark. Sparks is the controlling shareholder of DRI, the president of DRI and BAPCO, and the publisher of both companies’ newspapers. William Chilcote is a vice-president and business manager of DRI…

(concurring and dissenting):

I would affirm.

*816 1 think that the trial court’s findings of fact are sufficient and are supported by the evidence. The trial court here simply did not believe the plaintiffs’ witnesses. The trial judge considered the plaintiffs’ interests and motives in the case; the lack of corroborating evidence; the plaintiffs’ self-contradictions; the times at which the claims here made were first made. 1 The court concluded:

Absent believable witnesses, the plaintiffs who did have the burden failed unless their burden of proof was satisfied by the operation of some rule of law.

Perhaps that rule of law is stated by the majority in these words:

I am not aware of any rule of law which permits appellate courts to make assumptions of fact. An appellate court may create presumptions, even the mandatory kind which bind the trier of fact in the absence to the contrary. Although the opinion does not say so, that seems to be what the majority has done here. If so, then I disagree. I think it could be said that it is the universal intention of dealers to make a profit but that there is an intent to profit does not warrant the conclusion that all dealers are in fact…