Borschow Hospital v. Cesar Castillo

USCA1 Opinion











October 11, 1996
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT

________________________



No. 96-1113

BORSCHOW HOSPITAL AND MEDICAL SUPPLIES, INC.,
Plaintiff - Appellant,

v.

CESAR CASTILLO, INC., ET AL.,
Defendants - Appellees.


________________________







ERRATA SHEET ERRATA SHEET


The opinion of this court issued on September 23, 1996 is
corrected as follows:

On page 3, line 9, change Borschow to Becton Dickinson.
































UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
____________________

No. 96-1113

BORSCHOW HOSPITAL AND MEDICAL SUPPLIES, INC.,
Plaintiff - Appellant,

v.

CESAR CASTILLO INC., ET AL.,
Defendants - Appellees.

____________________

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF PUERTO RICO

[Hon. Salvador E. Casellas, U.S. District Judge] ___________________

____________________

Before

Selya, Circuit Judge, _____________
Torres* and Saris,** District Judges. _______________

_____________________

Fernando L. Gallardo, with whom Harry E. Woods, Geoffrey M. ____________________ ______________ ___________
Woods, Woods & Woods and Carlos R. Iguina-Charriz were on brief _____ _____________ ________________________
for appellant.
Donald R. Ware, with whom Richard M. Brunell and Foley, Hoag ______________ __________________ ___________
& Eliot were on brief for appellee Becton Dickinson and Company. _______
Edilberto Berr os-P rez and Luis Fern ndez-Ram rez for ________________________ ________________________
appellees C sar Castillo, Inc., Umeco, Inc., Jos Luis Castillo,
Ivonne Belaval de Castillo, C sar Castillo, Jr., Aracelis Ortiz
de Castillo and Mar a Isabel Gonz lez.


____________________

September 23, 1996
____________________

* Of the District of Rhode Island, sitting by designation.

** Of the District of Massachusetts, sitting by designation.

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____________________


















































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SARIS, District Judge. Plaintiff-Appellant Borschow SARIS, District Judge. _______________

Hospital & Medical Supplies, Inc. is a distributor of a line of

medical and surgical products supplied by Defendant-Appellee,

Becton Dickinson and Company, in Puerto Rico. Borschow claims

that Becton Dickinson violated the Puerto Rico Dealers Act, 10

L.P.R.A. 278, also commonly known as "Law 75," by granting

additional distributorships in violation of its allegedly

exclusive Distributorship Agreement.1 Although the

Distributorship Agreement contained a clear non-exclusivity

provision and integration clause, Borschow contends that the

district court erred under Puerto Rico's parol evidence rule when

it excluded an unsigned written memorandum sent prior to the

signing of the agreement as evidence that the parties actually

intended the distributorship to be exclusive.

Borschow also claims that Becton Dickinson engaged in

an unlawful tying arrangement in violation of Section 1 of the

Sherman Act, 15 U.S.C. 1, by threatening to discontinue a

supply of a line of its products (the tying products) unless

Borschow also carried its syringe line (the tied product) and

dropped that of a competitor.


____________________

1 The additional distributorships were granted to Defendants-
Appellees Cesar Castillo, Inc. and UMECO, Inc., which filed a
separate brief. At oral argument, Becton Dickinson argued for
the Appellees as a group. Where we refer to Becton Dickinson in
the course of this opinion, we mean our statements to apply to
Appellees as a group except where otherwise indicated.
Similarly, to avoid confusion where referring to the testimony of
Jonathan Borschow, Borschow's president, we will refer to him as
Mr. Borschow and to the company simply as Borschow.

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The district court granted summary judgment for Becton

Dickinson on both claims. We affirm.

I. STATEMENT OF THE CASE I. STATEMENT OF THE CASE

A. Facts A. Facts

Reviewing the factual record in the light most

favorable to the nonmoving party, as we must at summary judgment,

see Mesnick v. General Elec. Co., 950 F.2d 816, 822 (1st Cir. ___ _______ _________________

1991), cert. denied, 504 U.S. 985 (1992), we treat the following ____________

facts as controlling, noting, however, that Bectin Dickinson

disputes many aspects of this account.

A major supplier of medical products in Puerto Rico,

Borschow contracted with Parke Davis & Company ("Parke Davis") on

May 1, 1985 to distribute a line of medical and surgical products

manufactured by its subsidiary, Deseret Medical, Inc. (the

"Deseret Line"). In mid-1986, Becton Dickinson acquired Deseret

and assumed Parke Davis' obligations under the distribution

agreement as an assignee. This dispute turns in large part on

the content of that agreement.

The distribution agreement executed by Borschow and

Parke Davis ["Distribution Agreement"], includes two provisions

of interest here. First, it provides that "Company [i.e., Parke

Davis] hereby appoints Distributor [i.e., Borschow] and the

Distributor hereby accepts appointment, as the Company's

nonexclusive independent distributor of the Products for Regular ____________

Business in the Territory [i.e., Puerto Rico] during the term of

this Agreement." Distribution Agreement, 2.1.2 (emphasis


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added). Second, the contract included the following integration

clause:

Integration: The terms and provisions contained ___________
in this Agreement, including all Schedules
attached hereto and Company's Standard Terms and
Conditions of Sale in effect, from time to time,
constitute the entire agreement and is the final
expression of intent between the Parties relating
to the subject matter hereof and supersede, all
previous communications, representations,
agreements, and understandings, either oral or
written, between the Parties with respect to the
subject matter thereof. No agreement or
understanding varying or extending this Agreement
will be binding upon either Party hereto unless in
writing, wherein this Agreement is specifically
referred to, and signed by duly authorized
officers or representatives of the respective
Parties.

Id. 9.10. Borschow's president, Jonathan Borschow, initially ___

refused to sign any contract that included a non-exclusivity

provision. However, in negotiations prior to execution of the

Distribution Agreement, Robert Vallance, Deseret's Regional

Director for Canada/Latin America, assured Mr. Borschow that his

distributorship would be exclusive. Vallance promised him that

he would receive a letter from Parke Davis promising exclusivity.

When that letter was not forthcoming, Mr. Borschow telephoned

Vallance and inquired about the delay. Vallance told Mr.

Borschow that the people in "Morris Plains," the corporate

headquarters of Warner Lambert, Parke Davis' parent company, were

considering the matter.

After that conversation, Mr. Borschow received a draft

of the Distribution Agreement, which included the non-exclusivity

term. He again objected to Vallance but was told that the


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"contract cannot, it will not be changed. The people in Morris

Plains will not countenance it." However, Vallance reassured

Mr. Borschow that he would send a document that would outline the

"true" basis for their business relationship, including a promise

that Borschow's distributorship would be exclusive.

Within a matter of days, Mr. Borschow received a two-

page undated and unsigned outline. The outline specifies that

one of the supplier's obligations is to "sell exclusively to the

DISTRIBUTOR and refrain from selling to other DISTRIBUTORS or

clients in the territory while the AGREEMENT is in effect." The

outline neither explicitly mentions Mr. Borschow or Parke Davis

nor refers to the May 1 Distribution Agreement. Borschow

testified that he executed the Distribution Agreement

approximately two weeks after he received the outline.2

From the execution of the agreement in 1985 to 1986,

Borschow remained Parke Davis' exclusive distributor of the

Deseret line. After Becton Dickinson's acquisition of Deseret

in mid-1986, no changes were made in the relationship until

November 1989, when Becton Dickinson granted distributorships to

UMECO, Inc. and C sar Castillo, Inc.

Moreover, according to Borschow and his salespeople, at

approximately the same time that the additional distributors were

____________________

2 At Mr. Borschow's deposition, the parties marked the
Distribution Agreement as BDX-1 and the undated outline as BDX-3,
and throughout its brief Appellant refers to the documents by
those numbers. To avoid confusion, however, the Court will refer
to BDX-1 and BDX-3 as the Distribution Agreement and the Outline,
respectively.

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established in November 1989, Becton Dickinson demanded that

Borschow cease distributing the Monoject Syringe & Needle Line,

made by a Becton Dickinson competitor, and begin carrying the

Becton Dickinson syringe line. Becton Dickinson also threatened

that if Borschow did not meet this demand, it would no longer be

supplied with the Deseret line. However, Becton Dickinson did

not carry through on this threat. Although Borschow refused to

drop Monoject, Becton Dickinson continued to supply Deseret

products to Borschow.

B. Proceedings Below B. Proceedings Below

Borschow brought an action in federal district court

for the District of Puerto Rico on February 6, 1990, alleging

that Becton Dickinson's termination of Borschow's "exclusive"

distributorship violated Law 75 and that Becton Dickinson's

threat to tie the Deseret line to its syringe line violated the

Sherman Act. Borschow also alleged a conspiracy with Castillo

and UMECO in restraint of trade and attempted monopolization.

Federal jurisdiction was invoked on the basis of a federal

question and diversity of citizenship.

On September 24, 1990, the district court permitted

discovery limited to the threshold issue as to whether Borschow's

distributorship was exclusive. On January 15, 1991, Becton

Dickinson moved for summary judgment, asserting that taking these

facts in the light most favorable to Plaintiff, Borschow cannot

evade the effect of its written contract providing for non-

exclusivity. If Borschow's contract was non-exclusive, according


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to Becton Dickinson, the Law 75 claim fails as a matter of law.

In addition, Becton Dickinson argued that the outline was

extrinsic evidence of the contracting parties' intent that could

not be considered on summary judgment because of Puerto Rico's

parol evidence rule.

The motion was referred to a magistrate judge, who

issued a report and recommendation denying summary judgment on

the ground that the extrinsic evidence raised issues of fact

regarding whether the agreement provided for exclusivity. The

district court (Acosta, J.) initially adopted the magistrate

judge's recommendation without comment, but on a motion for

reconsideration, the court (Casellas, J.) granted partial summary

judgment for Becton Dickinson.3 The court held that Puerto

Rico's parol evidence rule barred consideration of the outline

and that the contract unambiguously provided for a non-exclusive

distributorship. Borschow Hosp. & Medical Supplies, Inc. v. __________________________________________

C sar Castillo, Inc., 882 F. Supp. 236, 239-40 (D.P.R. 1995). In ____________________

a subsequent order, the court granted partial summary judgment

for Becton Dickinson on the antitrust claims due to lack of

evidence of tying, anticompetitive injury or conspiracy and

dismissed the pendent state law claims. Borschow timely appealed

the judgment.

II. DISCUSSION II. DISCUSSION

A. Standard of Review A. Standard of Review

____________________

3 Judge Acosta took senior status before the motion for
reconsideration, and the case was reassigned to Judge Casellas.

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We review a district court's grant of summary judgment

de novo. Werme v. Merrill, 84 F.3d 479, 482 (1st Cir. 1996). ________ _____ _______

The standard is well-rehearsed and familiar. "Summary judgment

is appropriate when 'the pleadings, depositions, answers to

interrogatories, and admissions on file, together with the

affidavits, if any, show that there is no genuine issue as to any

material fact and that the moving party is entitled to judgment

as a matter of law.'" Barbour v. Dynamics Research Corp., 63 _______ ________________________

F.3d 32, 36 (1st Cir. 1995) (quoting Fed. R. Civ. P. 56(c)),

cert. denied, __ U.S. __, 116 S. Ct. 914 (1996). "In operation, ____________

summary judgment's role is to pierce the boilerplate of the

pleadings and assay the parties' proof in order to determine

whether trial is actually required." Wynne v. Tufts Univ. School _____ __________________

of Medicine, 976 F.2d 791, 794 (1st Cir. 1992), cert. denied, 507 ___________ ____________

U.S. 1030 (1993). "To succeed, the moving party must show that

there is an absence of evidence to support the nonmoving party's

position." Rogers v. Fair, 902 F.2d 140, 143 (1st Cir. 1990); ______ ____

see also Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). ________ _____________ _______

"Once the moving party has properly supported its

motion for summary judgment, the burden shifts to the non-moving

party, who 'may not rest on mere allegations or denials of his

pleading, but must set forth specific facts showing there is a

genuine issue for trial.'" Barbour, 63 F.3d at 37 (quoting _______

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256 (1986)). ________ _____________________

"There must be 'sufficient evidence favoring the nonmoving party

for a jury to return a verdict for that party. If the evidence


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is merely colorable or is not significantly probative, summary

judgment may be granted.'" Rogers, 902 F.2d at 143 (quoting ______

Anderson, 477 U.S. at 249-50) (citations and footnote in Anderson ________ ________

omitted). We "view the facts in the light most favorable to the

non-moving party, drawing all reasonable inferences in that

party's favor." Barbour, 63 F.3d at 36. _______

B. The Law 75 Claim B. The Law 75 Claim

"The legislature of Puerto Rico enacted Law 75 to

protect distributors, agents, concessionaires and representatives

of a product or service in Puerto Rico. . . . [M]ore

specifically, Law 75 was intended to protect dealers who built up

a market, from suppliers who wish to appropriate their

established clientele." Medina & Medina v. Country Pride Foods, _______________ ____________________

Ltd., 825 F.2d 1, 2 (1st Cir. 1987). "Law 75 provides that, ____

notwithstanding the existence in a dealer's contract of a clause

reserving to the parties the unilateral right to terminate the

existing relationship, no principal or grantor may directly or

indirectly perform any act detrimental to the established

relationship or refuse to renew said contract on its normal

expiration, except for just cause." General Office Prods. Corp. ___________________________

v. Gussco Mfg. Inc., 666 F. Supp. 328, 328 (D.P.R. 1987) (citing ________________

10 L.P.R.A. 278(a)).

Law 75 has proved fertile ground for litigation, and we

recently have had occasion to consider its application to

circumstances analogous to those presented here. Although "non-

exclusive distributors are entitled to protection under Law 75,"


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Vulcan Tools of Puerto Rico v. Makita U.S.A., Inc., 23 F.3d 564, ___________________________ ___________________

569 (1st Cir. 1994), "[i]t is equally true . . . that Law 75 does

not operate to convert non-exclusive distribution contracts into

exclusive distribution contracts." Id. (citing Gussco, 666 F. ___ ______

Supp. at 331). As we said in Vulcan Tools, "the 'established ____________

relationship' between dealer and principal is bounded by the

distribution agreement, and therefore the Act only protects

against detriments to contractually acquired rights." Id. at ___

569.

This case turns on whether Borschow and Parke Davis

(now Becton Dickinson) contracted for a non-exclusive or

exclusive distributorship. If the former, Borschow cannot

prevail on its claim that Law 75 prohibits Becton Dickinson from

supplying Deseret medical products to other distributors. See ___

Vulcan Tools, 23 F.3d at 569 (Law 75 did not prevent supplier ____________

from establishing additional distributorships in Puerto Rico

where non-exclusive distributor was already operating even if

existing distributor suffered economic harm as result); Nike ____

Int'l Ltd. v. Athletic Sales, Inc., 689 F. Supp. 1235, 1238-39 ___________ _____________________

(D.P.R. 1988) (where distributorship contract between Nike and

distributor provided for notice of renewal from distributor and

distributor failed to provide such notice, Law 75 did not bar

termination of distributorship contract).

As a civil law jurisdiction, Puerto Rico eschews common

law principles of contract interpretation in favor of its own

civil code derived from Spanish law. See Guevara v. Dorsey ___ _______ ______


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Labs., Div. of Sandoz, Inc., 845 F.2d 364, 366 (1st Cir. 1988) ____________________________

("The Supreme Court of Puerto Rico has made clear that the common

law of the United States is not controlling when filling gaps in

the civil law system."); Gussco, 666 F. Supp. at 332. Thus, we ______

turn to Civil Code Article 1233, which "determines the manner in

which courts should interpret contracts under dispute as to the

meaning of their terms." Hopgood v. Merrill Lynch, Pierce, _______ _______________________

Fenner & Smith, 839 F. Supp. 98, 104 (D.P.R. 1993), aff'd, 36 _______________ _____

F.3d 1089 (1st Cir. 1994) (table). Article 1233 provides:

If the terms of a contract are clear and
leave no doubt as to the intentions of the
contracting parties, the literal sense of its
stipulations shall be observed.

If the words should appear contrary to the
evident intention of the contracting parties,
the intention shall prevail.

31 L.P.R.A. 3471 (1991). "Under Puerto Rican law, an agreement

is 'clear' when it can 'be understood in one sense alone, without

leaving any room for doubt, controversies or difference of

interpretation. . . .'" Executive Leasing Corp. v. Banco Popular _______________________ _____________

de Puerto Rico, 48 F.3d 66, 69 (1st Cir.) (quoting Catullo v. ______________ _______

Metzner, 834 F.2d 1075, 1079 (1st Cir. 1987)) (internal quotation _______

marks omitted), cert. denied, __ U.S. __, 116 S. Ct. 171 (1995); ____________

see also Heirs of Ram rez v. Superior Court, 81 P.R.R. 347, 351 ________ _________________ ______________

(1959).

Citing the Puerto Rico Supreme Court in Marina Ind., ____________

Inc. v. Brown Boveri Corp., 114 P.R. Dec. 64, 72 (1983) (official ____ __________________

translation), several courts have interpreted Article 1233 to be

"strict in its mandate that courts should enforce the literal

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sense of a written contract, unless the words are somehow

contrary to the intent of the parties." Hopgood, 839 F. Supp. at _______

104; see also Vulcan Tools, 23 F.3d at 567 ("When an agreement ________ _____________

leaves no doubt as to the intention of the parties, a court

should not look beyond the literal terms of the contract.").

This interpretation of Article 1233 is complemented by

Puerto Rico's parol evidence rule, P.R. Laws Ann. tit. 32, App.

IV, R. 69(B) (1983) ("Rule 69(B)"), which provides:

When in an oral or written agreement, either
public or private, all the terms and
conditions constituting the true and final
intention of the parties have been included,
such agreement shall be deemed as complete,
and therefore, there can be between the
parties, or successors in interest, no
evidence extrinsic to the contents of the
same, except in the following cases:
(1) Where a mistake or imperfection of the
agreement is put in issue by the pleadings;
(2) Where the validity of the agreement is
the fact in dispute.
This rule does not exclude other evidence of
the circumstances under which the agreement
was made or to which it is related such as
the situation of the subject matter of the
instrument or that of the parties, or to
establish illegality or fraud.


We have interpreted this rule in tandem with Article 1233 to

require courts "to ignore [parol] evidence 'when the agreement

. . . is clear and unambiguous.'" Mercado-Garc a v. Ponce Fed. ______________ __________

Bank, 979 F.2d 890, 894 (1st Cir. 1992) (quoting Catullo, 834 ____ _______

F.2d at 1079).

Recently, we have held that these provisions bar

consideration of extrinsic evidence to vary the express, clear,

and unambiguous terms of a contract. See Executive Leasing ___ _________________

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Corp., 48 F.3d at 69-70 (refusing to consider parol evidence _____

regarding implied loan term barring leasing company from dealing

with other banks where contract did not include restriction but

did include clear integration clause); Vulcan Tools, 23 F.3d at ____________

564-68 (where contractual term providing for "non-exclusive"

distributorship was clear and unambiguous, there was no need to

consider extrinsic evidence of promise to limit number of

distributors even absent contractual integration clause); see ___

also Hopgood, 839 F. Supp. at 103-05 (holding that term ____ _______

"indefinite" used in employment contract clearly signified

employment at will and refusing to consider parol evidence of

implied guarantee of three-year minimum employment).

This line of cases effectively parries the main thrust

of Borschow's appeal. The Distribution Agreement clearly and

unambiguously gives Borschow a "non-exclusive" distributorship.

The integration clause, specifying that the terms and provisions

of this Distribution Agreement constitute the "entire agreement"

and "the final expression of intent," nullifies any other oral or

written understandings reached between the parties. Crediting

Mr. Borschow's testimony that he received the outline from

Vallance promising an exclusive distributorship, as we must on

summary judgment, we hold that the integration clause rendered

inoperative any such side-agreement, and we are barred from

considering the extrinsic evidence by Rule 69(B).

Borschow attempts to evade the effect of this settled

precedent by arguing that the entire agreement, properly


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construed, includes both the Distribution Agreement and the

Outline. Because the documents contain mutually inconsistent

terms, Borschow contends that Article 1233 of Puerto Rico's Civil

Code permits liberal consideration of extrinsic evidence as to

the parties' intent to resolve contractual ambiguity. To some

extent, Borschow's reliance on this Civil Code principle finds

some support in Puerto Rico case law. The Puerto Rico Supreme

Court has held that:

The intention of the parties is the essential
test provided in the Civil Code to fix the
scope of contractual obligations. This test
of intention is so essential in the
interpretation of contracts that the Code
proclaims its supremacy in providing that the
evident intention of the parties shall
prevail over the words, even where the latter
would appear contrary to the intention . . .
.

Merle v. West Bend, 97 P.R.R. 392, 399 (1969). However, that _____ __________

court subsequently clarified that "[t]he strict mandate of the

cited art. 1233 obliges us to abide by the literal meaning of the

terms of the contract when, as in the present case, they leave no

doubt as to the intention of the contracting parties." Marina ______

Ind. Inc. v. Brown Boveri Corp., 114 P.R. Dec. 64 (1983) __________ ____________________

(official translation).

In rejecting essentially the same argument now made by

Borschow, we applied this principle in Executive Leasing Corp.: _______________________

The plaintiffs concede the loan agreement is
clear. They argue, however, that the written
agreement was not in fact the entire
agreement, and that we must consider
extrinsic evidence of the parties' intent
with respect to integration. . . . Yet to
consider extrinsic evidence at all, the court

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must first find the relevant terms of the
agreement unclear. That requirement not
being met, the district court correctly went
no further.

48 F.3d at 69 (excluding extrinsic evidence of exclusive dealing

condition and of "actual practice" of parties); accord Hopgood, ______ _______

839 F. Supp. at 106 (explaining that Marina and Merle support ______ _____

principle that under Article 1233 the clear terms of the contract

are the "embodiment of the indisputable intent of the parties as

they entered into the contract").

For the third time, we mean what we say, and say what

we mean: extrinsic evidence of the parties' intent is

inadmissible in the face of a clear and unambiguous contract term

under Puerto Rico Law. Because Borschow's distributorship was

non-exclusive as a matter of law, the district court properly

granted summary judgment for Appellees on the Law 75 claim.4

C. Antitrust Claim -- Tying Arrangement C. Antitrust Claim -- Tying Arrangement

Asserting a per se violation of Section One of the _______

Sherman Act, Borschow contends that Becton Dickinson threatened

to withhold sale of its patented Deseret line of medical products

(the tying product) unless Borschow dropped the Monoject product



____________________

4 While the Puerto Rico parol evidence rule permits extrinsic
evidence to establish fraud, Borschow does not allege that it was
fraudulently induced into signing the Distribution Agreement.
Nor is a claim of equitable estoppel properly before us.
Borschow contends for the first time on appeal that Becton
Dickinson should be estopped from denying the existence of an
exclusive contract because of the conduct of its agent, Vallance.
As this argument was not made below, it is waived. Executive _________
Leasing Corp., 48 F.3d at 70. _____________

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and carried instead its own syringe line (the tied product).5

Contending that this is "the case of the tie that didn't bind,"

Becton Dickinson argues that a threat alone is insufficient to

constitute an illegal tying arrangement. We agree.

"Section 1 of the Sherman Act prohibits a seller from

'tying' the sale of one product to the purchase of a second

product if the seller thereby avoids competition on the merits of

the 'tied' product. See 15 U.S.C. 1 ('Every contract . . . in ___

restraint of trade or commerce . . . is declared to be

illegal.')" Data General Corp. v. Grumman Systems Support Corp., __________________ _____________________________

36 F.3d 1147, 1178 (1st Cir. 1994). "There are essentially four

elements to a per se tying claim: (1) the tying and the tied ______

products are actually two distinct products; (2) there is an

agreement or condition, express or implied, that establishes a

tie; (3) the entity accused of tying has sufficient economic

power in the market for the tying product to distort consumers'

choices with respect to the tied product; and (4) the tie

forecloses a substantial amount of commerce in the market for the

tied product." Id. at 1178-79.6 ___
____________________

5 See Amended Verified Complaint 28-29. Plaintiff also
asserts a claim under the Clayton Act, 3, that we need not
separately address. See Grappone , Inc. v. Subaru of New ___ _________________ ______________
England, Inc., 858 F.2d 792, 793 (1988) (pointing out that _____________
essential elements of unlawful tying arrangement are same for
alleged violations of Sherman Act 1 or Clayton Act 3). In
addition, Borschow conceded at oral argument that our holding
that the Distribution Agreement was non-exclusive would foreclose
relief on all of its antitrust claims except its tying claim.

6 Borschow does not articulate a "rule of reason" theory of
tying liability. Although the amended verified complaint
contains conclusory allegations that Becton Dickinson's conduct

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The fatal flaw in Borschow's tying claim is that Becton

Dickinson never withheld its Deseret line. Although Borschow has

adduced evidence of various threats by Becton Dickinson, it is

undisputed that these threats were not carried out. Permitted to

carry both the Deseret line and the Monoject line, Borschow was

never injured by the threat. See Wells Real Estate, Inc. v. ___ ________________________

Greater Lowell Board of Realtors, 850 F.2d 803, 814 (1st Cir.) _________________________________

(holding that plaintiff must have been injured by anticompetitive

act to have standing under antitrust laws), cert. denied, 488 _____________

U.S. 955 (1988).

As a result, the second key element discussed above --

evidence of a tie -- is missing:

[T]he essential characteristic of an invalid
tying arrangement lies in the seller's
exploitation of its control over the tying
product to force the buyer into the purchase
of a tied product that the buyer either did
not want at all, or might have preferred to
purchase elsewhere on different terms. When
such "forcing" is present, competition on the
merits in the market for the tied item is
restrained and the Sherman Act is violated.

Jefferson Parish Hosp. Dist. No. 2 v. Hyde, 466 U.S. 2, 12 _____________________________________ ____

(1984); see also T. Harris Young & Assoc., Inc. v. Marquette ________ ________________________________ _________
____________________

generally had an adverse effect on competition, there is no
evidence in the record to support the allegation that the threats
of tying had such an adverse impact, or to provide a basis for
providing further discovery pursuant to Fed. R. Civ. P. 56(f).
See Jefferson Parish Hosp. Dist. No. 2 v. Hyde, 466 U.S. 2, 29-31 ___ __________________________________ ____
(1984) (noting that in absence of per se liability, antitrust ______
plaintiff must prove that defendant's conduct had an "actual
adverse effect on competition"); R.W. International Corp. v. __________________________
Welch Food, Inc., 13 F.3d 478, 487-88 (1st Cir. 1994) (rejecting _________________
request for further discovery despite conclusory allegations of
antitrust injury where plaintiff distributors were in same
position as defendant to ascertain effect of conduct at issue).

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Electronics, Inc., 931 F.2d 816, 822-23 (11th Cir.) ("[F]or a tie _________________

to exist a seller must withhold product A unless the buyer also

selects product B. Only after the existence of a tie is shown is

it necessary to determine whether an illegal tying arrangement

exists.") (footnote omitted), cert. denied, 502 U.S. 1013 (1991); ____________

CIA Petrolera Caribe, Inc. v. Avis Rental Car Corp., 576 F. Supp. __________________________ _____________________

1011, 1016 (D.P.R. 1983) ("Coercion is an essential element of

any tying arrangement, i.e., forcing the purchaser or lessor to

take the unwanted tied product along with the tying product."),

aff'd, 735 F.2d 636 (1st Cir. 1984). _____

Where a tying product has not been withheld, there is

no tie. "There is no tie for any antitrust purpose unless the

defendant improperly imposes conditions that explicitly or

practically require buyers to take the second product if they

want the first one." 10 Phillip E. Areeda et al., Antitrust Law: ______________

An Analysis of Antitrust Principles and their Application ______________________________________________________________

1752b, at 280 (1996). Thus we hold that there is no genuine

issue of material fact with respect to Borschow's tying claim.7

III. CONCLUSION III. CONCLUSION

For the foregoing reasons, the district court's grant

of summary judgment is AFFIRMED. AFFIRMED





____________________

7 This holding also disposes of Borschow's discovery claim.
Borschow contends that the district court abused its discretion
by refusing to allow further discovery. However, no amount of
discovery would uncover evidence of a non-existent tie.

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