author: EAST, Senior District Judge: ALFRED T. GOODWIN, Circuit Judge

text:
    M. D. RUTLEDGE et al., Appellants, v. ELECTRIC HOSE & RUBBER COMPANY et al., Appellees.
    Nos. 71-2840, 71-2841.
    United States Court of Appeals, Ninth Circuit.
    Jan. 30, 1975.
    As Corrected March 3, 1975.

      Joel R. Bennett (argued), Palos Verdes, Cal., for appellants.
    Patrick Lynch, (argued), Frank R. Johnston, Los Angeles, Cal. (argued), John F. McClatchey, Cleveland, Ohio (ar-
    gued), Gibson, Dunn & Crutcher, John J. Hanson, Don J. Belcher, Newlin, Tackabury & Johnston, Frank R. Johnston, O’Melveny & Myers, Homer I. Mitchell, Patrick Lynch, Los Angeles, Cal., Arthur, Dry, Kalish, Taylor & Wood, Walter Barthold, New York City, Mitchell, Silberberg & Knupp, Robert L. Winslow, Los Angeles, Cal., Domke, Marcoux, Allen & Beaman, John H. Schomer, Jackson, Mich., Robert J. Burdett, Chicago, 111., Bruce M. Gleason, Los Angeles, Cal., Winston & Strawn, Earl A. Jinkinson, John W. Stack, Chicago, 111., Thompson, Hiñe and Flory, John F. McClatchey, Cleveland, Ohio, Cantey, Hanger, Gooch, Cravens & Munn, Cecil F. Munn, Edward L. Kemble, Fort Worth, Tex., McCutchen, Black, Verleger & Shea, Philip K. Verleger, Los Angeles, Cal., and Jones, Day, Cockley & Reavis, George H. Rudolph, Victor DeMarco, Cleveland, Ohio, for appellees.
    Before GOODWIN and WALLACE, Circuit Judges and EAST, Senior District Judge.

       Honorable William G. East, Senior United States District Judge for the District of Oregon, sitting by designation.

   OPINION

EAST, Senior District Judge:

THE CASE

This treble damage antitrust action was filed on April 29, 1969. The cause ultimately came on for trial before the District Court sitting without a jury on February 25, 1971 and reached final judgment on June 2, 1971.

Appellants, M. D. Rutledge, doing business as Rubber Hose Supply Company and Industrial Hose and Rubber Company, and Mechanicals, Inc., a corporation, owned and controlled by Rutledge, appeal from an order of the District Court entered on April 22, 1971, granting the appellees’ motion for dismissal pursuant to Rule 41(b) (Fed.R.Civ.P.) and the final judgment in favor of all of the appellees entered on June 2, 1971. We affirm.

THE INDUSTRY

The products involved in this case are hydraulic hose assemblies, which consist of hydraulic hose and hydraulic hose couplings. Hydraulic hose is simply a reinforced flexible hose, the primary purpose of which is to carry fluids under relatively high pressures, and have been for many years manufactured and sold by companies generally known as “hose companies.” A hydraulic hose assembly consists of a length of the hydraulic hose with a coupling or fitting attached at each end to make it useful and has been designed and manufactured by specialty companies generally known as “couplers.”

Rutledge is a coupler. Five of the appellees are hose companies and seven are couplers.

PRIOR LITIGATION

This appeal is the latest chapter in a story that goes back over 12 years to April, 1962, when a Federal Grand Jury commenced criminal investigations of companies in the hydraulic hose assembly industry. Following approximately three years of investigation by three Grand Juries, two separate indictments were returned in 1965, one of which charged six hose companies with price fixing. That proceeding ended with pleas of nolo contendere. The other indictment charged the seven coupler appellees and a number of individuals with conspiring in antitrust actions. Following three years of proceedings, that criminal cause succumbed to motions for acquittal and dismissal. United States v. Aeroquip Corporation, 284 F.Supp. 114 (E.D.Mich.1968) (Detroit suit).

Some of the appellees herein were not party to those proceedings.

CLAIMS OF RUTLEDGE TRIED

The record shows that Rutledge failed to cooperate with his counsel’s efforts to arrive at a subscribed agreed pretrial order. Following Rutledge’s refusal to join and after notice and hearing, the District Court on January 5, 1971 settled and entered a pre-trial order setting forth the claims of Rutledge as follows:

(1) Alleged conspiracy in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1;
(2) Alleged discriminatory sales in violation of Sections 2(a) and 2(d) of the Clayton Act, as amended by the Robinson-Patman Act, 15 U.S.C. § 13(a) and (d).
(3) Alleged conduct on the part of the coupler appellees in violation of Section 2(f) of the Clayton Act, as amended by the Robinson-Patman Act, 15 U.S.C. § 13(f).

ASSIGNMENTS OF ERROR

There are numerous assignments of error; however, we are satisfied that a discussion of the following seven assignments is sufficient for an appropriate disposition of this appeal:

“1. Was it reversible error for the District Court to rule that this matter may not be maintained as a class action under Rule 23, [Fed.R.Civ.P.]?”
“2. Was it reversible error for the District Court to terminate plaintiffs’ discovery rights only one month after defendants’ answers were filed?” and to refuse “to grant a continuance [of trial] for purposes of discovery”?
“5. [Which we paraphrase as follows: Was it reversible error for the District Court to deny appellants their constitutional right to a jury trial under Rule 38 (Fed.R.Civ.P.)?
b. Is Local Rule 13 invalid and unreasonable because it is inconsistent with Rule 38(b)?
d. Did the court abuse its discretion in declining to determine that the issues in the case may be tried to a jury under Rule 39(b) (Fed.R. Civ.P.)?]”
“7. Was it reversible error for the District Court to rule that the witnesses who had testified at the government’s criminal trial and who resided beyond the 100 mile subpoena power of the Court, were not ‘unavailable’ within the meaning of California Evidence Code Section 240 thus precluding the use of their former testimony against the couplers?”
“8. Was it reversible error for the District Court to exclude from evidence the copy of the ‘Rogge-Fischer’ letter [Exhibit 19] proffered by plaintiffs?”
“9. Was it reversible error for the District Court to grant defendants’ Motions to Dismiss under Rule 41(b) [Fed.R.Civ.P.]?”
“12. Was it reversible error for the District Court to rule that the former testimony given at the Detroit trial may be used against the couplers only in connection with Sherman Act claims but not as to Robinson-Patman claims?”

We find no abuse of judicial discretion on the part of the District Court in any other aspect of the pretrial or trial proceedings, and conclude all other assignments of error to be without merit.

DISCUSSION

Assignment of Error No. 1:

The appellees moved the District Court pursuant to Rule 23 for an order determining that the action could not be maintained as a class action, asserting therein that under the circumstances of the case, the class device was not superi- or to other available methods within the meaning of Rule 23(b)(3) and that Rutledge was not an adequate class representative within the meaning of Rule 23(a)(4). The District Court granted the motion.

It is now recognized that the failure of any one of Rule 23’s requirements destroys the alleged class action. Eisen v. Carlisle & Jacquelin, 391 F.2d 555, 561 (2d Cir. 1968).

In deciding whether to allow a class action, a primary determination to be made is whether the class action is superior to, and not just as good as, other available methods for handling the controversy, and such a determination lies in an area where the trial court’s discretion is paramount. City of New York v. International Pipe & Ceramics Corp., 44 F.R.D. 584, 587 (S.D.N.Y.1968), app. dismissed 410 F.2d 295 (2d Cir. 1969); Buford v. American Finance Company, 333 F.Supp. 1243, 1250 (N.D. Ga.1971); Alameda Oil Co. v. Ideal Basic Industries, Inc., 326 F.Supp. 98, 105 (D.Colo.1971); cf. Amendments to Rules of Civil Procedure, Advisory Committee’s Notes, 39 F.R.D. 69, 103 (1966).

Also, “as a result of the sweeping changes in Rule 23, a court must now carefully scrutinize the adequacy of representation in all class actions.” Eisen v. Carlisle & Jacquelin, supra 391 F.2d at 562.

We conclude that the District Court’s order disallowing the class action was correct and its reasons therefor were sound. We find no abuse of judicial discretion in the entry of the order. See Shields v. Valley National Bank of Arizona, 56 F.R.D. 448 (D.Ariz.1971), and Interpace Corporation v. City of Philadelphia, 438 F.2d 401, 404 (3d Cir. 1971).

Assignment of Error No. 2:

On April 13, 1970, the District Court, following notice and hearing, limited and fixed the time for the completion of Rutledge’s discovery at July 13, 1970, 15 months after the action was filed. The District Court’s findings of fact Nos. 51 and 52 reveal the situation which confronted the District Court, and we are satisfied that the record fully supports the findings. We find no abuse of judicial discretion in limiting the time for Rutledge’s discovery. Fulton v. Coppco, Inc., 407 F.2d 611, 613 (10th Cir. 1969), and MacKay v. American Potash & Chemical Co., 268 F.2d 512, 517 (9th Cir. 1959).

Rutledge complains that the last answer of the appellees was not filed until June 11, 1970. Dilatoriness on the part of one party, if any, is no excuse for clear-cut, prolonged dilatory activity on the part of a moving party. The function of a plaintiff’s discovery is to secure evidence in support of his claims. For an even more severe sanction against a dilatory plaintiff, see California Molasses Co. v. C. Brewer & Co., 479 F.2d 60 (9th Cir. 1973).

A related assignment of error, based on the District Court’s refusal on January 6, 1971 to grant a continuance of the trial date of the following January 19 for the purpose of permitting Rutledge to continue its discovery, is frivolous. The only ground asserted for the continuance was to change lawyers. We find no abuse of judicial discretion in that refusal. Cf. Thompson v. Fleming, 402 F.2d 266 (5th Cir. 1968); see Grunewald v. Missouri Pacific Railroad Company, 331 F.2d 983, 987 (8th Cir. 1964).

Assignment of Error No. 5.b.:

Rule 38(a) generally provides that the right of trial by jury shall be preserved to the parties inviolate. Rule 38(b) allows any party to demand a trial by jury by serving a demand therefor in writing within specified times. Specifically the rule provides “[s]uch demand may be indorsed upon a pleading of the party,” and, further, in subsection (d):

“Waiver. The failure of a party to . serve a demand as required by this rule . . . constitutes a waiver by him of trial by jury.”

On its face, the rule prescribes “positive action which a party must take in the exercise of his right of trial by jury,” else he be deemed to have waived the right. Petsel v. Chicago B. & Q. R. Co., 101 F.Supp. 1006, 1007 (S.D.Iowa 1951). See 5 Moore’s Federal Practice ¶ 38.40, at 327 et seq. The waiver provi sions of Rule 38 are constitutional. 5 Moore’s Federal Practice ¶ 38.08, p. 83, n. 68.

Local Rule 13, promulgated and in effect in the Central District of California for some years prior to the institution of this action by local counsel, provides:

“Any party may demand a jury as provided in F.R.Civ.P., Rule 38(b), but such demand, if included in a pleading as referred to in Rule 38(b), shall be set forth at the end thereof and be signed by the party making such demand or his attorney. The caption of the pleading in which the demand is made shall also contain the following: ‘Demand for Jury Trial.’ The demand may be made in a separate written, signed document by the party making such demand or his attorney.” (Emphasis supplied.)

It follows that Rutledge had at his election one of two procedures for making his “Demand for Jury Trial” under Rule 38 as refined by the local rule in order to preserve his right of jury, viz.: (1) the serving upon other parties of a demand therefor in writing, or (2) “Such demand may be indorsed upon a pleading.”

He elected to utilize the second procedure and caused to be typed in the caption of his complaint below the title of the pleading the words “Jury Demanded,” and further started the language of his complaint as follows:

“The above named plaintiffs, by their attorneys, bring this civil action against the above named defendants, and each of them, and demanding trial by jury, complain and allege as follows:”

Rule 38(b) uses the phrase “indorsed upon a pleading,” but is silent as to the form and substance of the indorsement. The common ordinary understanding of the word “indorsed” and necessarily the written act thereof is a writing. Webster’s New International Dictionary (2d ed.). Rule 38(b) commands under procedure 2 that the demand for jury trial be indorsed upon a pleading and the local rule merely refines or prescribes the form and substance of the indorsement. Contrary to Rutledge’s contention, we conclude that the requirements of the local rule do not conflict with any of the provisions of Rule 38, nor does the local rule impose additional basic procedural requirements beyond the local rule making power. See Colgrove v. Battin, 413 U.S. 149, 93 S.Ct. 2448, 37 L.Ed.2d 522 (1973). The local rule in no way restricts any of the provisions of Rule 38 and merely prescribes the location and the form of the indorsement of a demand upon a pleading. 12 Wright and Miller, Federal Practice and Procedure § 3154, p. 233, and 7 Moore’s Federal Practice ¶ 83.03, pp. 83-89, n. 17.

The reasonableness of the requirements of the local rule are self-evident. The demand for jury trial on the face of the pleading is to alert the clerk in the docket process, and the signed statement at the end is'to constitute the affirmative action required by Rule 38. Rutledge failed to comply and the District Court was correct in insisting on compliance with the local rule and ordering the trial to be had by the court without a jury.

Assignment of Error No. 5d.:

This assignment refers to rule 39(b); however, Rutledge’s motion for relief from the order striking the jury demand was predicated under Rule 6(b) (Fed.R.Civ.P.) on the ground of “excusable neglect.” Relief under that rule is within the “discretion” of the District Court, and that discretion should rarely be exercised to grant a trial by jury in default of a proper request for it. Mason v. British Overseas Airways Corp., 20 F.R.D. 213 (S.D.N.Y.1957), cited in Tomlin v. Pope & Talbot, Inc., 282 F.2d 447, 449 (9th Cir. 1960). Clearly no abuse of judicial discretion occurred in the denial of the Rule 6(b) motion.

Rutledge urges that under the circumstances and in view of Rutledge’s attempt to secure a jury trial, the District Court should have ordered a jury trial under Rule 39(b).

The District Court was facing an avowed highly complex and prolonged trial involving great expense and months of judicial time, yet with little or no showing of good faith desire for a jury trial. When the jury issue arose, the trial court asked about appellants’ true intent in demanding a jury and counsel replied, in part, “I assume that as a trial tactic I can always waive as I move toward the [trial] date itself . . . .”

“The denial of a motion made under this rule is to be sustained unless an abuse of judicial discretion is shown. See Johnson v. Gardner, 179 F.2d 114, 118 (9th Cir. 1949). For this reason appellate courts normally refuse to interfere. 5 Moore’s Federal Practice, 2d ed., H 39.09, p. 715.” Tomlin, supra 282 F.2d at 449.

Finally, we believe that in these private antitrust complicated proceedings, the District Court was, as above stated, faced with many other important factors. In our weighing of the nature and totality of all circumstances of the case, the complexity of expected jury questions, and the public interest generally, we cannot say that the denial of a jury trial under the provisions of Rule 39(b) was an abuse of judicial discretion. 9 Wright and Miller, Federal Practice and Procedure, § 2334, p. 120, n. 49.

Assignments of Error Nos. 7 and 12:

These two assignments relate to the evidence proffered by Rutledge, namely, 40 volumes of transcribed testimony of certain governmental witnesses in the Detroit suit who now reside distant from the State of California.

Section 1291 of the California Evidence Code provides, inter alia:

“Former testimony offered against party to former proceeding, (a) Evidence of former testimony is not made inadmissible by the hearsay rule if the declarant is unavailable as a witness and:
«(1) * * *
“(2) The party against whom the former testimony is offered was a party to the action or proceeding in which the testimony was given and had the right and opportunity to cross-examine the declarant with an interest and motive similar to that which he has at the hearing.” (Emphasis supplied.)

Although the District Court was originally of the view that the transcripts might be admissible as former testimony involving the coupler defendants in the Detroit suit, but not the hose company appellees, after hearing the evidence at trial, the District Court concluded to reject the offer on the basis that the Detroit transcripts were inadmissible because Rutledge had not established unavailability of the witnesses, and further that the coupler appellees had no fair opportunity to cross-examine the declarant as specified in § 1291(a)(2).

The record discloses that the District Court took the unavailability status of the witnesses whose testimony was proffered in transcript form on a one-to-one basis, and in each instance, found that Rutledge had not exercised “reasonable diligence” within the meaning of § 240(a)(5) of the California Evidence Code. The District Court had substantial discretion in deciding what constitutes unavailability within the meaning of § 240. Sanchez v. Bagues & Sons Mortuaries, 271 Cal.App.2d 188, 192-194, 76 Cal.Rptr. 372 (1969).

We find no abuse of judicial discretion in the above rulings.

In the Detroit suit, the coupler defendants were charged with having conspired among themselves to persuade and induce their suppliers of hydraulic hose to grant them lower prices than were charged to their competitors. In this case, Rutledge alleges that the hose company appellees conspired with the coupler appellees in violation of Section 1 of the Sherman Act. Their theory at trial, however, was even further from the facts alleged in Detroit. All that Rutledge attempted to prove at trial was the existence of a mere price fixing conspiracy on the basis of consciously parallel uniformity of prices. There was no evidence of any effort or agreement to induce or persuade those companies to grant lower prices as charged in the Detroit case.

In addition, the appellees were charged in separate counts with violations of Section 2 of the Clayton Act, as amended by the Robinson-Patman Act, 15 U.S.C. § 13. No Robinson-Patman violation was charged in the Detroit suit.

The District Court concluded that because of the substantial disparity between the issues at the Detroit trial and the issues as they emerged at trial in this action, the coupler defendants did not have an opportunity at the Detroit trial to cross-examine any witnesses called by the government with a motive and interest similar to that which they had in this proceeding, and rejected the proffered transcribed testimony.

The record fully supports that conclusion, and the proffered former testimony clearly does not qualify for admission in evidence under § 1291(a)(2).

Assignment of Error No. 8:

The so-called Rogge-Fischer letter (Rutledge’s Exhibit 19) is a typed copy of a three-page document assertedly written by W. F. Rogge as an agent of Aeroquip Corporation, a defendant in the Detroit suit and a coupler trade association, to George Fischer of The B.F. Goodrich Company, a defendant in the Detroit suit and herein, on February 20, 1958, and was proffered by Rutledge in making proof on his Section 2(a), (d) and (f) of the Robinson-Patman Act claims.

For the authenticity of the letter (Section 1400, California Evidence Code), and in satisfaction of the best evidence rule (Sections 1501 — 1503, California Evidence Code), Rutledge relied on the affidavit of Dwight Moore, one of the government’s trial counsel in the Detroit case, and an offer of proof of asserted testimony by Rutledge personally. The District Court rejected the offer on the grounds of a failure of authentication as well as on a failure to comply with the secondary evidence admission rule.

“In the federal courts the trial judges have great latitude on questions of admissibility of evidence.” Batelli v. Kagan and Gaines Co.,-236 F.2d 167, 170 (9th Cir. 1956).

The record and the offer of proof are silent as to the authorship of the Rogge-Fischer letter and we find no abuse of discretion in rejecting the offer. Assignment of Error No. 9:

The appellees base their Rule 41(b) motion for dismissal of the cause on the premise that the facts of the cause had been presented as a nonjury trial before the District Court, and upon the grounds that Rutledge had failed to establish by satisfactory proof any of his claims against any of the appellees.

We are aware that the granting of a Rule 41(b) (nonsuit in a nonjury trial) motion and the District Court’s findings of fact thereon may not be set aside “unless clearly erroneous.” Rule 52(a) (Fed.R.Civ.P.). The fact finding process under a Rule 41(b) motion calls for an adjudication upon the merits of the plaintiff’s claims and may involve a weighing of the evidence as it stands at the close of the plaintiff’s case by the District Court.

We are also aware that on a Rule 50(a) (Fed.R.Civ.P.) motion for a directed verdict in a jury trial at the close of an opponent’s case, the District Court must consider all of the evidence in the light most favorable to the plaintiff and may grant the motion only if as a matter of law the evidence is insufficient to justify a verdict for the plaintiff. 5 Moore’s Federal Practice, ¶ 41.13 [3] and [4], pp. 1153 — 1156. “In considering a motion for a directed verdict, the court must give the party against whom the motion is made the benefit of all reasonable evidentiary inferences. [Cited authority omitted.] This is no less true in an antitrust case. However, if there is no substantial evidence to support the claim, the court must direct a verdict. Chisholm Bros. Farm Equip. Co. v. Int’l Harvester Co., 498 F.2d 1137 (CA9 1974).” Cleary v. National Distillers and Chemical Corporation, 505 F.2d 695 (9th Cir. 1974).

Earlier we were confronted with Rutledge’s claim that his trial should have been held as a jury trial and he makes a formidable assignment of error in that regard. Accordingly, with the view of conserving judicial time and in an effort of reaching finality in this prolonged litigation, we will utilize the directed verdict test in analyzing for error the District Court’s order granting the Rule 41(b) motion and its findings of fact and conclusions of law entered in support of the final judgment.

Section 1 of the Sherman Act:

• We are satisfied that a full and fair reading of the District Court’s order of dismissal and its findings of fact and conclusions of law entered in support of the final judgment clearly indicates that the District Court had concluded that as a matter of law Rutledge had failed to produce sufficient evidence, when viewed in a light most favorable to Rutledge in support of his Section 1 of the Sherman Act claims against the hose company appellees. Indeed our independent search of the record finds no evidence of any joint or concerted action among any of those appellees to accomplish any crime or unlawful purpose proscribed by Section 1 of the Sherman Act. Standard Oil, supra, and Lynch, supra.

Robinson-Patman Section 2(a) Claim:

We are also satisfied that from a full and fair reading of the District Court’s findings and conclusions, it is revealed that the District Court concluded as a matter of law that Rutledge had failed to produce any evidence of the elements of a prima facie violation of 15 U.S.C. § 13(a).

Section 2(a) deals with specific sales transactions, and provides that such transactions are unlawful only if these six separate jurisdictional elements are present:

(1) Two or more contemporaneous sales by the same seller. Bruce’s Juices v. American Can Co., 330 U.S. 743, 755, 67 S.Ct. 1015, 91 L.Ed. 1219 (1947), and Texas Gulf Sulphur Company v. J. R. Simplot Company, 418 F.2d 793, 808 (9th Cir. 1969).
(2) At different prices. Flintkote Company v. Lysfjord, 246 F.2d 368, 392 (9th Cir. 1957).
(3) Of commodities of like grade and quality. Minneapolis-Honeywell Co. v. F.T.C., 191 F.2d 786 (7th Cir. 1951), cert. dismissed 344 U.S. 206, 73 S.Ct. 245, 97 L.Ed. 245 (1952).
(4) Where at least one of the sales was made in interstate commerce. Universal-Rundle Corporation v. F.T.C., 382 F.2d 285 (7th Cir. 1967), and Northern California Monument Dealers Assn. v. Interment Assn, of California, 120 F.Supp. 93 (N.D.Cal.1954).
(5) The discrimination had the requisite effect upon competition generally. Tri-Valley Packing Association v. F.T.C., 329 F.2d 694 (9th Cir. 1964).
(6) The discrimination caused injury to the plaintiff. Bigelow v. RKO Radio Pictures, 327 U.S. 251, 264-265, 66 S.Ct. 574, 90 L.Ed. 652 (1946); Secatore’s, Inc. v. Esso Standard Oil Co., 171 F.Supp. 665, 667 (D.Mass.1959); and Youngson v. Tidewater Oil Co., 166 F.Supp. 146, 147 (D.Or.1958).

We have perused the record and find no direct or inferential evidence in support of all the six necessary elements of a prima facie violation of the Section 2(a) claim and deem the District Court conclusions correct.

Robinson-Patman Section 2(d) Claim:

It is manifest from a reading of the record and Rutledge’s brief on this appeal that he has misread the proscription of 15 U.S.C. § 13(d).

Section 2(d) does not refer to benefits to’ “favored buyers” in connection with the original sale to the buyer, such as discounts, nor does it refer to a seller who charges different prices to different buyers according to the qualification or functional level of the buyer; rather it refers to payments in connection with the resale by the buyer of the goods, for advertising, promotion or other similar purposes. Exquisite Form Brassiere, Inc. v. F.T.C., 112 U.S.App. D.C. 175, 301 F.2d 499 (1961); Rowe, Price Discrimination Under the Robinson-Patman Act, at 371. Cf. Surprise Brassiere Co. v. F.T.C., 406 F.2d 711 (5th Cir. 1969).

The record is bare of any evidence of payment or lower price allowance by any hose manufacturer to any coupler of any sum in connection with any of the services with which Section 2(d) concerns itself, to wit, promotion, advertising or similar activities connected with the resale of-goods. .

The District Court correctly concluded that as a matter of law the Section 2(d) claim must fail.

Robinson-Patman Section 2(f) Claim:

The District Court outrightly concluded as a matter of law that Rutledge had not established a 15 U.S.C. § 13(f) claim against any coupler appellee. We have reviewed the authorities relied upon in the order of dismissal, and conclude that the District Court was right.

Affirmed.

ALFRED T. GOODWIN, Circuit Judge

(specially concurring):

I concur in the majority opinion insofar as it affirms the dismissal of the action. I do so because I am satisfied that the proof put on by the plaintiff would not have sustained a verdict if there had been a jury.

I do not approve the district court’s refusal to permit the plaintiff to rehabilitate its demand for a jury trial in order to comply with local rules. While I agree with the district court that the conduct of some of the plaintiff’s earlier lawyers was hardly a model of efficiency and diligence, it is risky business to punish inept lawyers by denying their client a trial by jury. I would have resolved the doubts about compliance with the local rules in favor of allowing the party to cure the deficiency. On the whole record in this case, however, any error or abuse of discretion with reference to the plaintiff’s Seventh-Amendment rights was harmless.


source: Caselaw Access Project

author: CRAVEN, Circuit Judge: WINTER, Circuit Judge

license: Public Domain

text:
    HOSPITAL BUILDING COMPANY, Appellant, Federation of American Hospitals, Amicus Curiae, v. TRUSTEES OF the REX HOSPITAL, a corporation, et al., Appellees.
    No. 73-1627.
    United States Court of Appeals, Fourth Circuit.
    Argued Oct. 3, 1974.
    Decided Feb. 18, 1975.

      John K. Train, III, and Timothy S. Perry, Atlanta, Ga. (Jordan, Morris & Hoke, Raleigh, N. C., and Alston, Miller & Gaines, Atlanta, Ga., and John R. Jordan, Jr., Raleigh, N. C., on brief), for appellant.
    Carl Weissburg, Lawrence E. Mindell and Weissburg, Jacobs & Gerst, Los Angeles, Cal., on brief for amicus curiae Federation of American Hospitals.
    Ray S. Bolze, Washington, D. C., and John H. Anderson, Raleigh, N. C. (Thomas W. Steed, Jr., Raleigh, N. C., John R. Fornaciari, Alexandria, Va., Allen, Steed & Pullen, and Smith, Anderson, Blount & Mitchell, Raleigh, N. C., Howrey, Simon, Baker & Murchison, Washington, D. C., Lillard H. Mount, Richard M. Hut-son, II, and Hofler, Mount, White & Long, Durham, on brief), for appellees.
    Before HAYNSWORTH, Chief Judge, BRYAN, Senior Circuit Judge, and WINTER, CRAVEN, BUTZNER, RUSSELL, FIELD, and WIDENER, Circuit Judges, sitting en banc.
   CRAVEN, Circuit Judge:

In this action filed pursuant to sections 4 and 16 of the Clayton Act, 15 U.S.C. §§ 15 & 26, appellant Hospital Building Corporation (HBC) sought treble damages in excess of $2 million and injunctive relief for alleged violations of sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1 & 2. The sole question before us is whether the district court erred when it dismissed HBC’s amended complaint on the ground that it failed to allege a sufficient nexus with interstate commerce to invoke the Sherman Act.

I.

The motion to dismiss was lodged under Rule 12(b)(1) and (6) of the Federal Rules of Civil Procedure. Whether termed “lack of jurisdiction over the subject matter” or “failure to state a claim upon which relief can be granted,” the result of such a motion, if granted, is the same. Dismissal under Rule 12, the lineal descendant of demurrer, is, of course, merely a decision on the pleadings. For that reason, such motions “are granted sparingly and with caution.” 5 Wright & Miller, Federal Practice and Procedure § 1349, at 541. Especially is this so in antitrust cases “because it may be difficult to plead more precisely the effects on interstate commerce until discovery has been had.” Chapiewsky v. G. Heileman Brewing Co., 297 F.Supp. 33, 38 (W.D.Wis.1968). Generally, we think that where a question of fact arises as to the substantiality of the impact of a local restraint on interstate commerce, the question should not be decided on a motion to dismiss. Donlan v. Carvel, 209 F.Supp. 829, 831 (D.Md.1962). Our task would be much simpler had the district court converted the motion to one for summary judgment as authorized by the last sentence of Rule 12(b). Such a course would doubtless have involved the district court and counsel in limited discovery procedures, but we think the extra time and effort would have been worthwhile.

Whether the complaint was dismissed for lack of subject matter jurisdiction or failure to state a claim upon which relief could be granted is not clear. Since Congress specifically has conferred jurisdiction of Sherman Act claims (15 U.S.C. §§ 15 & 26), we think it the better analysis to treat an insufficient plea of effect upon interstate commerce as a failure to state a claim upon which relief can be granted rather than lack of jurisdiction (in the sense of power) over the subject matter. So viewed, our distaste for judgment on the pleadings is even greater, for a motion to dismiss for failure to state a claim “is viewed with disfavor and [should be] rarely granted.” 5 Wright & Miller, supra, § 1357 at 598.

Nevertheless, we have concluded to affirm. That we do so should be taken by the bar and the district judges as a rare exception to prove the rule that judgments of dismissal on the pleadings in antitrust cases will ordinarily be reversed.

II.

HBC operates in Raleigh, North Carolina, a 49-bed proprietary hospital, Mary Elizabeth Hospital, which offers general medical-surgical hospital services to the public. The appellees, referred to by HBC in its brief and hereinafter by us as “the Raleigh Group,” are a North Carolina corporation that runs a hospital in competition with Mary Elizabeth in Raleigh and various individuals involved in the provision of medical-surgical hospital services in Raleigh. HBC alleged below that, beginning at least as early as 1970 and continuing through the present, the Raleigh Group together with others not parties to this suit have engaged in a conspiracy aimed at controlling the number of hospital beds, allocating customers (hospital patients), and otherwise exercising unreasonable restraints of and monopolizing the market for medical-surgical hospital services in “the Raleigh area,” defined as “the area comprising Wake County, in the State of North Carolina.”

HBC professed to have discovered the conspiracy in late 1971 when it undertook to relocate Mary Elizabeth and expand it from 49 to 140 beds. According to HBC the Raleigh Group and their co-conspirators devised a scheme involving bad faith efforts to block authorization of the expansion, tactics to hold up implementation of HBC’s plans once authorization was gained, and finally malicious instigation of adverse publicity and general public antipathy. HBC alleged that the scheme has delayed expansion of Mary Elizabeth, and asked as damages treble the amount of direct costs and loss of revenue attributable to the delay. HBC also sought injunctive relief against a continuation of the alleged conspiracy. Because we conclude that the district court was correct in finding that even if HBC proved all of its factual allegations it still would have shown an insufficient connection with interstate commerce to invoke the Sherman Act, we affirm.

III.

An antitrust plaintiff may establish the necessary connection with interstate commerce in either of two ways: by demonstrating that the alleged anticompetitive conduct occurred in interstate commerce, or by showing that the conduct, though wholly intrastate, had a substantial effect on interstate commerce.

Greenville Publishing Co. v. Daily Reflector, Inc., 496 F.2d 391, 395 (4th Cir. 1974) (emphasis added). See also Goldfarb v. Virginia State Bar, 497 F.2d 1, 16 (4th Cir.), cert. granted, 419 U.S. 963, 95 S.Ct. 223, 42 L.Ed.2d 178 (1974) (No. 74-70); Sun Valley Disposal Co. v. Silver State Disposal Co., 420 F.2d 341, 343 (9th Cir. 1969); Lieberthal v. North Country Lanes, Inc., 332 F.2d 269, 271-72 (2d Cir. 1964). Within this traditional analytic framework the question for decision is whether the conspiracy described in HBC’s complaint has either directly restrained or substantially affected interstate commerce.

IV.

There is little basis for HBC’s assertion that the alleged conspiracy acts directly in interstate commerce. The Raleigh Group is concerned exclusively with restraining Mary Elizabeth’s provision of hospital services and with controlling the market for such services in the Raleigh area. The provision of hospital services has consistently been held to be a purely local activity. Elizabeth Hospital, Inc. v. Richardson, 269 F.2d 167, 170 (8th Cir.), cert. denied, 361 U.S. 884, 80 S.Ct. 155, 4 L.Ed.2d 120 (1959); Spears Free Clinic v. Cleere, 197 F.2d 125, 126 (10th Cir. 1952). Therefore, anticompetitive conduct aimed at the provision of such services necessarily acts directly only upon intrastate commerce. See United States v. Oregon State Medical Society, 343 U.S. 326, 338-39, 72 S.Ct. 690, 96 L.Ed. 978 (1952); Elizabeth Hospital, Inc. v. Richardson, supra; Riggall v. Washington County Medical Society, 249 F.2d 266, 268 (8th Cir. 1957), cert. denied, 355 U.S. 954, 78 S.Ct. 540, 2 L.Ed.2d 530 (1958); Spears Free Clinic v. Cleere, supra.

HBC’s argument that the Raleigh Group’s anticompetitive conduct occurred “in commerce” amounts to this: (1) Mary Elizabeth, and hospitals in general, have become substantially enmeshed in the interstate commerce network through their use of interstate communications facilities, their subjection to extensive federal regulation, their purchases of materials and services from out-of-state, their treatment of patients from other states, and their financial arrangements with national health insurers and government welfare programs; (2)' the conspiracy directly affected Mary Elizabeth; therefore, the conspiracy, by acting upon a hospital so entwined in interstate commerce, acted directly upon interstate commerce. We accept the premises of the syllogism but reject the conclusion.

It is settled that the “in commerce” test is not whether the conduct complained of is aimed at a business engaged in interstate commerce, but whether the conduct complained of acts directly upon the interstate aspects of such a business. United States v. Yellow Cab Co., 332 U.S. 218, 230-34, 67 S.Ct. 1560, 91 L.Ed. 2010 (1947); Sun Valley Disposal Co. v. Silver State Disposal Co., supra, 420 F.2d at 343; Lieberthal v. North Country Lanes, Inc., supra, 332 F.2d at 271; Savon Gas Stations Number Six, Inc. v. Shell Oil Co., 309 F.2d 306, 308-09 (4th Cir. 1962), cert. denied, 372 U.S. 911, 83 S.Ct. 725, 9 L.Ed.2d 719 (1963); Page v. Work, 290 F.2d 323, 330 (9th Cir.), cert. denied, 368 U.S. 875, 82 S.Ct. 121, 7 L.Ed.2d 76 (1961). Here, no matter how entwined in our increasingly national economy Mary Elizabeth and other Raleigh area hospitals may be, the fact remains that the conspiracy complained of directly affected only one aspect of those hospitals’ businesses, namely the provision of surgical-medical hospital services in the Raleigh area. And the provision of such services remains what it always has been: a local, intrastate activity, not interstate commerce.

In its argument that “in commerce” jurisdiction exists HBC relies heavily on language from Rasmussen v. American Dairy Association, 472 F.2d 517 (9th Cir.), cert. denied, 412 U.S. 950, 93 S.Ct. 3014, 37 L.Ed.2d 1003 (1973). We cannot see the relevance of that case to our situation for purposes of the “in commerce” test. The court in Rasmussen indicated, although it did not decide conclusively, 472 F.2d at 524 — 25, that the “in commerce” test was met by a restraint on the intrastate sale of a filled-milk product called “Go” which was manufactured in state from ingredients all but one of which originated out of state. The court was able to suggest that the restraint acted directly upon the flow of commerce formed by “Go” and its ingredients because — as the court said —“for all practical purposes, the out-of-state ingredients are ‘Go.’ ” Id. at 525 (original emphasis). Cf. Mandeville Island Farms, Inc. v. American Crystal Sugar Co., 334 U.S. 219, 68 S.Ct. 996, 92 L.Ed. 1328 (1948). Here, in contrast, there is no out-of-state product that is passed to patients in an economic transaction as a dominant ingredient of hospital services in the Raleigh area. Probably the only out-of-state products sold by Mary Elizabeth are drugs, and they are sold not so much as part of the interstate trade in drugs, but rather as a small and inseparable component of the service provided by Mary Elizabeth. This case is therefore different from Northern California Pharmaceutical Ass’n v. United States, 306 F.2d 379, 386-87 (9th Cir.), cert. denied, 371 U.S. 862, 83 S.Ct. 119, 9 L.Ed.2d 99 (1962), where the court found sales of drugs by pharmacies part of the interstate commerce flow of drugs: there, the drugs in their flow from manufacturer to ultimate consumer never lost their character as both a product and a distinct line of commerce.

V.

It is not so easy to decide the result under the second, or “affecting commerce,” branch of the analysis. Here the fact that the Raleigh Group’s conduct acted directly only upon a local market and a local aspect of Mary Elizabeth’s business is not dispositive. The question remains whether that conduct, though local in its immediate motive and effect, nevertheless so substantially affects interstate commerce as to invoke the Sherman Act. That can only be a matter of degree, and such matters are never clear:

There is no bright line dividing cases in which the effect upon interstate commerce is sufficient to permit Congress to prohibit particular anticompetitive activity under the commerce clause from those cases in which it is not sufficient. In this area perhaps more than in most, each case must turn on its own facts.

Rasmussen v. American Dairy Association, supra, 472 F.2d at 526.

HBC suggests several ways in which interstate commerce has been affected by the Raleigh Group’s thwarting of the Mary Elizabeth expansion. Neither the hospital’s interstate purchases of supplies and equipment, its billings to national insurance companies and the federal government, nor its purchases of management services from its parent corporation have increased as they would were the hospital to expand. And the $4 million cost of expansion was to be financed by non-North Carolina lenders, so that substantial interest payments would flow across state lines.

Aware that such decisions should be exercises of reasoned economic judgment rather than applications of mechanistic formulae, see Rasmussen v. American Dairy Association, supra, 472 F.2d at 523, we conclude that the various ramifications noted by HBC do not add up to a sufficiently substantial effect upon interstate commerce to satisfy Sherman Act requirements. The effect here seems to us the indirect and fortuitous consequence of the restraint of the intrastate Raleigh area hospital market, rather than the result of activity purposely directed toward interstate commerce. Although not controlling, this factor is relevant to the issue of substantiality. See, e. g., Spears Free Clinic v. Cleere, supra, 197 F.2d at 127; Marston v. Ann Arbor Property Managers (Management) Association, 302 F.Supp. 1276, 1280 (E.D.Mich.1969), aff’d per curiam, 422 F.2d 836 (6th Cir.), cert. denied, 399 U.S. 929, 90 S.Ct. 2244, 26 L.Ed.2d 796 (1970). Moreover, when the various economic consequences are sorted out and considered in the perspective of their respective markets, it is obvious that none of them could have more than negligible impact: no source of supply or insurance company or lending institution can be expected to go under if Mary Elizabeth doesn’t expand, and no market price likely will be affected. In short, we are unconvinced that the alleged conspiracy, even if successful, can affect interstate commerce in the detrimental manner that concerned Congress when it passed the Sherman Act. Cf. Page v. Work, supra, 290 F.2d at 332-33.

In deciding that there is here insufficient impact on interstate commerce to invoke the Sherman Act we do not overlook Doctors, Inc. v. Blue Cross of Greater Philadelphia, 490 F.2d 48 (3d Cir. 1973). The Third Circuit in that case found jurisdiction over an alleged conspiracy of Blue Cross and a hospital planning agency aimed at manipulating the Greater Philadelphia hospital services market to Blue Cross’s benefit. The court based its finding on the fact that the conspiracy, if successful, could shut down many of the approximately 100 hospitals in the Greater Philadelphia area, which could affect as much as $23 million per year in interstate shipments of supplies. According to the court, and we agree, this potential effect upon the traffic in out-of-state goods was “substantial enough” to invoke the Sherman Act. 490 F.2d at 53.

We think Doctors, Inc. is distinguishable. There is simply no significant comparison between the effect on commerce of one small hospital’s delayed expansion, especially when other hospitals contemplate expansion, and the vastly greater effect of the possible closing of a significant percentage of the hospitals in a metropolitan area. The Doctors, Inc. court carefully distinguished its situation from Lieberthal v. North Country Lanes, Inc., supra, and Page v. Work, supra, referring to them as “good law” and “the kinds of cases which remain beyond the reach of interstate commerce jurisdiction.” 490 F.2d at 54. We agree and conclude that this case resembles Lieberthal and Page more than Doctors, Inc.

Having quite plausibly, we think, fit this case into its appropriate pigeonhole entitled “nonsubstantial or de minimis effect on interstate commerce,” we are left with a feeling of dissatisfaction. Labeling one case “de minimis” and another as “affecting commerce” does achieve a result but is not otherwise very revealing. Anyone who studies decisions applying the “affecting commerce” test will be struck by the absence of a clear line, much less a bright one, between those effects that are deemed substantial and those that are characterized as “indirect,” or “fortuitous,” or “insubstantial,” or “de minimis,” or “sporadic,” or “incidental.” In any area so very gray it is absurd to suppose that we or any other court can precisely count up the tons of plaster, bottles of liquor, or quantity of proprietary drugs sufficient to cross the line of substantiality. Increasingly, intrastate economic conduct affects interstate commerce due to the interdependence of all segments of our national economy. Whether or not “de minimis” has ever been an effective litmus for application of the Sherman Act, we doubt that it now is, and we are concerned that conventional impact analysis may sometimes conceal rather than reveal the true rationale of decision.

Rather than attempt a quantitative measurement of interstate involvement, we should, perhaps, consider instead the real danger, in a practical sense, of anti-competitive conduct to the flow of commerce, or the potential destructive power of a conspiracy. It seems to us that courts have been doing that for a long time without necessarily saying so. Such an approach is implicit in the format and choice of words of Mr. Justice Black in United States v. Employing Plasterers Ass’n, 347 U.S. 186, 74 S.Ct. 452, 456, 98 L.Ed. 618 (1954). The opinion runs only three pages. The approach is a sweeping one suggesting indignation that a local group of people were “able to dictate who could and who could not buy plastering materials that had to reach Illinois through interstate trade if they reached there at all.” 347 U.S. at 189, 74 S.Ct. at 454 (italics added). Such restraints are characterized as capable of causing “unreasonable burdens on the free and uninterrupted flow of plastering materials into Illinois.” Id. Notable by its absence is any quantitative analysis. Omitted is any detailed narrative of the type of commerce involved. Instead there is simply a note of impatience that any district judge could possibly have dismissed a Sherman Act complaint that alleged defendants’ power to control the intrastate market.

Similarly, in Burke v. Ford, 389 U.S. 320, 88 S.Ct. 443, 19 L.Ed.2d 554 (1967), the Supreme Court peremptorily reversed a court of appeals in a two-page per curiam. The economics of the case and description of the commerce involved were reduced to a footnote. The Court focused not on how many bottles of bourbon went from place to place but on its apprehension that this intrastate conspiracy would “invariably reduce competition” and cause a price increase. 389 U.S. at 321, 88 S.Ct. 443.

The evil of monopoly power is the theme of both Employing Plasterers and Burke. Not one word is said about whether the anticompetitive conduct substantially or insubstantially affects interstate commerce.

In our case there is no allegation that the Raleigh Group has the power to put HBC out of business, or indeed, upon a fair reading of the whole amended complaint, that it can do any more than delay, at most, whatever expansion seems economically wise to the plaintiff. In Doctors, Inc., on the other hand, the plaintiffs alleged that defendants had the power to shut down a hundred hospitals. Thus the real difference between our case and Doctors, Inc. may be not so much the quantitative difference in effect on interstate commerce as the dramatic difference in anticompetitive power — the danger Congress sought to guard against. Viewed in such a manner the cases seem more persuasively different than if simply stuffed into their respective pigeonholes of insubstantial and substantial impact on interstate commerce.

Affirmed.

ADDENDUM

On December 17, 1974, after the preparation of the opinion in this case, the Supreme Court released its decision in Gulf Oil Corp. v. Copp Paving Co., 419 U.S. 186, 95 S.Ct. 392, 42 L.Ed.2d 378. Mr. Justice Powell’s opinion for the Court notes that the grant of certiorari was limited to questions arising under the Clayton and Robinson-Patman Acts. What is said about the Sherman Act, by' way of comparison with those Acts, is not new, at 194, 195, 95 S.Ct. 398. Although dictum as to the Sherman Act, we think language on pages 198, 199, 95 S.Ct. on page 400 is consistent with our belief that problems of application of trade control statutes cannot be solved by counting units of merchandise.

The justification for an expansive interpretation of the “in commerce” language, if such an interpretation is viable at all, must rest on a congressional intent that the Acts reach all practices, even those of local character, harmful to the national marketplace. This justification, however, would require courts to look to practical consequences, not to apparent and perhaps nominal connections between commerce and activities that may have no significant economic effect on interstate markets.

WINTER, Circuit Judge

(dissenting):

Although I concurred in the panel decision affirming the district court’s dismissal of the amended complaint for failure to allege a sufficient nexus with interstate commerce to sustain a cause of action under the Sherman Act, I am now persuaded that the holding was incorrect. In my view, this amended complaint may not be dismissed on the pleadings. Of course, I express no view as to whether the jurisdictional allegations can be proved, but plaintiff should be afforded the opportunity to establish them, if not at trial, at least by a prima facie showing to defeat any motion by defendants for summary judgment. I therefore dissent from the majority’s affirmance of the district court’s dismissal of the amended complaint under Rule 12, F.R.Civ.P.

I.

The amended complaint alleges that the action is brought to redress actions of the defendants which constitute “(1) a combination and conspiracy in restraint of trade in violation of Section 1 of the Sherman Act and (2) an attempt to monopolize in violation of Section 2 of the Sherman Act. . . . ” Before the specific allegations of fact to support these jurisdictional assertions are considered, it is well to consider the scope of application of the Sherman Act. What combinations and conspiracies in restraint of trade and what attempts to monopolize does the Sherman Act prohibit?

There is no novelty in the answer. The settled law was recently restated in Gulf Oil Corporation v. Copp Paving Company, Inc., 419 U.S. 186, 95 S.Ct. 392, 42 L.Ed.2d 378 (1974). See also Greenville Publishing Co., Inc. v. Daily Reflector, Inc., 496 F.2d 391, 395-96 (4 Cir. 1974). Gulf Oil was a case which turned on the jurisdictional requirements of § 2(a) of the Robinson-Patman Act and §§ 3 and 7 of the Clayton Act. It held that intrastate sales of asphalt for use in the construction of interstate highways were not sales “in commerce” within the ambit of the two Acts. In arriving at this result, the Court reviewed the jurisdictional scope of the two Acts and compared them with the jurisdictional scope of the Sherman Act.

The Court contrasted the “in commerce” concept of the Robinson-Patman Act and the Clayton Act with the jurisdictional scope of the Sherman Act, saying:

This “in commerce” language differs distinctly from that of § 1 of the Sherman Act, which includes within its scope all prohibited conduct “in restraint of trade or commerce among the several States, or with foreign nations. . . . ” The jurisdictional reach of § 1 thus is keyed directly to effects on interstate markets and the interstate flow of goods. Moreover, our cases have recognized that in enacting § 1 Congress “wanted to go to the utmost extent of its Constitutional power in restraining trust and monopoly agreements. . . . ” United States v. South-Eastern Underwriters Association, 322 U.S. 533, 558, 64 S.Ct. 1162, 1176, 88 L.Ed. 1440 (1944). Consistently with this purpose and with the plain thrust of the statutory language, the Court has held that, however local its immediate object, a “contract, combination ... or conspiracy” nonetheless may constitute a restraint within the meaning of § 1 if it substantially and adversely affects interstate commerce. E. g., Mandeville Island Farms, Inc. v. American Crystal Sugar Co., 334 U.S. 219, 234, 68 S.Ct. 996, 1005, 92 L.Ed. 1328 (1948). “If it is interstate commerce that feels the pinch, it does not matter how local the operation which applies the squeeze.” United States v. Women’s Sportswear Manufacturing Association, 336 U.S. 460, 464, 69 S.Ct. 714, 93 L.Ed. 805 (1949). (Emphasis in text added.) 419 U.S. at 194, 95 S.Ct. at 398.

With the standard of what the Sherman Act encompasses so clearly defined, I have no hesitancy in concluding that plaintiffs have alleged a sufficient adverse effect on interstate commerce to-confer jurisdiction on the district court to decide the case on its merits. Under Gulf Oil, the test is one of congressional power, and the question is whether Congress could reach the alleged conduct under the commerce power. This is the clear meaning of the statement that “. . . Congress ‘wanted to go to the utmost extent of its Constitutional power’ . . .” The majority holds in effect that the alleged activity is too tenuously related to interstate commerce in a practical sense to justify federal regulation for antitrust reasons. In reaching this conclusion, the majority opinion, as its addendum demonstrates, applies a test designed for determining the jurisdictional ambit of the Clayton and Robinson-Patman Acts. Gulf Oil, however, teaches that this test is inappropriate for actions brought under the Sherman Act. In any event, the majority’s conclusion is based upon determinations of: (1) the quantitative impact on interstate commerce of the alleged conduct, assessed in terms of precedent sustaining and rejecting complaints, and (2) the qualitative importance of the anti-competitive power alleged in the complaint. By both, I think that proper application of the Sherman Act can be demonstrated.

II.

As the majority opinion states, the conspiracy in which defendants allegedly engaged was to prevent Hospital Building Company (HBC) from expanding the capacity of its proprietary Mary Elizabeth Hospital in Raleigh, North Carolina, from 49 to 149 beds. HBC is a wholly-owned subsidiary of Charter Medical Corporation (Charter), which has its principal office in Macon, Georgia, and which, by contract, provides management services to HBC for a fee, including the negotiation of contracts for the purchase of hospital supplies. Suppression of the expansion, it was charged, was to enable defendants to reduce competition in local hospital services by HBC and to enable defendants to control the local hospital service market and thus to allocate it among themselves.

HBC averred that the alleged conspiracy had the following effects on interstate commerce:

(1) It purchases approximately 80% of its supplies and medicines from vendors in states other than North Carolina. In 1972, excluding food and supplies for its kitchen, it purchased $112,846 of supplies for its radiology, medical laboratory, and electrocardiology operations and its pharmacy. If the hospital were enlarged from 49 to 149 beds, such purchases in interstate commerce would not only continue but increase substantially.
(2) It regularly uses interstate communication, including the mails, to carry out its operations. It pays Charter a fee under the management contract with it. The fee is based on gross receipts, and for 1972 the fee was approximately $36,000. If the hospital were expanded, the amount of the fee would increase substantially.
(3) The fees for hospital services and charges for many of the patients at the existing hospital are paid by insurers and other providers outside of North Carolina. Although not alleged, it may be inferred that if the hospital were expanded fees paid by out-of-state providers would increase substantially.
(4) If the hospital were increased from 49 to 149 beds, the cost thereof would exceed $4,000,000. That cost would be financed by one or more loans with one or more lenders located outside of North Carolina. Payment of principal and interest would extend substantially into the future, and it would require regular remittances to a lender outside of North Carolina. Conclusorily, HBC alleged that the

combination and conspiracy which it charged has “a substantial and direct effect on interstate commerce.” I agree. The allegations establish the suppression of an interstate cash flow that would be both substantial and continuing. Cf. Lieberthal v. North Country Lanes, Inc., 332 F.2d 269 (2 Cir. 1964). I therefore am of the view that jurisdiction was alleged to exist in accord with the test reiterated in Gulf Oil.

III.

Doctors, Inc. v. Blue Cross of Greater Philadelphia, 490 F.2d 48 (3 Cir. 1973), as the majority points out, is a stronger case than the instant one for concluding that the alleged conspiracy had a substantial effect on interstate commerce and that the Sherman Act applied. In Doctors, the named plaintiff purchased $233,430 in supplies from out-of-state suppliers in the test year. Although this figure does not seem to be of any greater magnitude than the projected flow alleged by the plaintiff here, the majority relies on the fact that Doctors’ Hospital was typical of the approximately one-hundred other hospitals in the area against all of which the conspiracy was directed, so that it could properly be inferred that interstate purchases of great magnitude were jeopardized. The distinction, however, is largely without difference. Gulf Oil reminds us that, in enacting § 1 of the Sherman Act, Congress was exercising to the fullest extent its constitutional power to restrain trusts and monopolies. Thus, it is not only the “big” resultant restraint on interstate commerce that it outlawed; the “little” resultant restraint on interstate commerce is outlawed too so long as a direct adverse effect on interstate commerce is demonstrated and that effect is not de minimis.

To be more specific, in Doctors the argument was advanced, as urged by the defendants here, that the object of the conspiracy was the intrastate activity of the rendition of hospital services and the effect on interstate commerce was indirect and insubstantial, so that the Sherman Act was inapplicable. In Doctors, the argument was rejected in terms which make that case a relevant and persuasive authority for reversing the district court in the instant case. Analyzing Burke v. Ford, 389 U.S. 320, 88 S.Ct. 443, 19 L.Ed.2d 554 (1967), and United States v. Employing Plasterers Ass’n, 347 U.S. 186, 74 S.Ct. 452, 456, 98 L.Ed. 618 (1954), the Third Circuit pointed out that in both the Supreme Court found that a sufficient effect on the flow of out-of-state supplies to local businesses had been alleged to confer Sherman Act jurisdiction. 490 F.2d at 52. More importantly, “there [was not] even a concern with the specific magnitude of the impact on interstate commerce caused by the alleged conspiracy. Instead, the Court in each case ends its inquiry when it has satisfied itself that the logical and therefore probable effect of the alleged act is to reduce the flow of goods in interstate commerce.” 490 F.2d at 53.

I recognize and accept that there are instances in which the effect on interstate commerce of anticompetitive conduct aimed at local activities may be too insubstantial to invoke Sherman Act jurisdiction. Lieberthal v. North Country Lanes, Inc., 332 F.2d 269 (2 Cir. 1964) (the one-time equipping of a new local bowling alley), and Page v. Work, 290 F.2d 323 (9 Cir. 1961) (alleging conspiracy to control legal advertising, thus causing a newspaper specializing in such advertising to sell its assets to another publisher who continued the paper and continued to buy the same quantity of newsprint from out-of-state sources), are good examples. But the instant case is more like Doctors than Lieberthal and Page. If HBC were permitted to expand, its purchases in interstate commerce and its other interstate activities would increase. It follows that an alleged conspiracy to prevent its expansion has an adverse effect on interstate commerce — not de minimis — and should be held to support jurisdiction under § 1 of the Sherman Act.

IV.

Similarly, I view the anticompetitive power alleged here as substantial. In essence the plaintiffs allege that a local conspiracy was able to forestall out-of-state entry into the local hospital market. If by means of conspiracy and harassment those who hold a local market can foreclose or limit the entry of competition, capital, and initiative from out-of-state, then it seems to me that the federal interest in interstate commerce is directly involved. To conclude, as the majority does, that the plaintiffs here do not allege the kind of anticompetitive power which “Congress sought to guard against” is merely to disbelieve the plaintiff’s allegations. In the Sherman Act, not only the “evil of monopoly power,” but the evil of improper attempts to achieve it are condemned. Where, as here, the out-of-state plaintiffs suggest that local official power and processes were used to delay and deter them, the plaintiffs implicate not only antitrust policy as such, but also the “national market” concerns which animate the commerce clause itself.

HBC’s allegations about the flow of financing, management services, and supplies to the hospital from out-of-state have been stated. Additionally, HBC alleges that the overwhelming majority of the fees paid to it come from the federal government and from out-of-state providers. Money thus flows from Blue Cross, private insurers, and the federal government to the hospital and thence to out-of-state suppliers, managers, and financiers. While this construction of the facts may not put HBC’s provision of hospital services in the “flow” of commerce as that term is used in the case law, it does make it graphically clear that if HBC is affected, a wide range of interstate connections is affected.

There is, furthermore, a clear and significant federal interest in at least one of these connections — the interstate flow of medicare and medicaid payments, and more generally with the costs of medical care in Wake County. Actual or attempted monopolization of the local market could have a dramatic effect, not only to decrease the flow of hospital payments, but to increase the cost of hospital care in the Raleigh area as well. If hospital care costs are increased, insurance costs will also increase, and federal and out-of-state providers will spread these increased costs beyond the local area in which they are incurred. And this is so even if the overall market for hospital care in the Raleigh area is neither increased nor diminished, but only concentrated in the hands of the hospital defendants.

Under all these circumstances, I think it myopic to maintain that the service itself is rendered locally. Local patient care may be the hub of hospital operation, but the spokes — financing, supplies, management, . and fee payments — all have out-of-state implications. The hub cannot be braked without affecting the spokes.

Judge BUTZNER and Judge FIELD authorize me to say that they, too, dissent and concur in this dissenting opinion.

      . At the time HBC sought authorization, North Carolina law required a certificate of need prior to hospital expansion. See In Re Certificate of Need for Aston Park Hosp., Inc., 282 N.C. 542, 193 S.E.2d 729 (1973), in which the requirement was held to violate the constitution of North Carolina.

      . The volume, amount, or quantity of interstate commerce involved is irrelevant under the “in commerce” test, but may be crucial under the “affecting commerce” test. See Greenville Publishing Co. v. Daily Reflector, Inc., 496 F.2d 391 n. 6, 395 (4th Cir. 1974); Rasmussen v. American Dairy Ass’n, 472 F.2d 517, 526-28 (9th Cir.), cert. denied, 412 U.S. 950, 93 S.Ct. 3014, 37 L.Ed.2d 1003 (1973); Las Vegas Plumbers Merchant Ass’n v. United States, 210 F.2d 732, 739-40 n. 3 (9th Cir.), cert. denied, 348 U.S. 817, 75 S.Ct. 30, 99 L.Ed. 645 (1954); United States v. Richter Concrete Corp., 328 F.Supp. 1061, 1065-66 (S.D.Ohio 1971). As in other contexts, see, e. g., United States v. LeFaivre, 507 F.2d 1288 (4th Cir. 1974), the Congress utilized its recognized power over commerce to reach detrimental activity. “The addition of the words ‘or commerce among the several States’ was not an additional kind of restraint to be prohibited by the Sherman Act but was the means used to relate the prohibited restraint of trade to interstate commerce for constitutional purposes . . . Apex Hosiery Co. v. Leader, 310 U.S. 469, 495, 60 S.Ct. 982, 993, 84 L.Ed. 1311 (1940). Thus if anticompetitive conduct occurs in commerce, to whatever degree, the Sherman Act is triggered. But if anticompetitive conduct occurs wholly intrastate, Congress has left to the courts to decide whether such conduct “is sufficiently related to interstate commerce to justify the prohibition of that conduct as ‘necessary and proper’ to the protection of interstate commerce against the presumed economic burdens resulting from the anticompetitive practices.” Rasmussen v. American Dairy Ass’n, supra, 472 F.2d at 524.

      . Mary Elizabeth’s purchases totalled $112,-846 in 1972, 80 percent of which sum was paid pursuant to national contracts negotiated by HBC’s parent corporation.

      . Such billings represented approximately 95 percent of Mary Elizabeth’s total billings in 1972.

      . $36,000 in 1972. HBC’s parent corporation was incorporated and is located outside of North Carolina, so that the purchase of services can be deemed interstate.

      . An example of anticompetitive conduct that is aimed at a local market and yet directly and purposefully affects interstate commerce is that in United States v. Frankfort Distilleries, Inc., 324 U.S. 293, 65 S.Ct. 661, 89 L.Ed. 951 (1945). Liquor dealers in Colorado conspired to fix retail liquor prices within the state, a purely local aim. But as a means of accomplishing their purpose they agreed both to compel out-of-state liquor producers to enter into fair trade contracts and to boycott those producers who failed to do so. The Supreme Court in finding Sherman Act jurisdiction focused upon this tactic of the conspirators, stating that “[w]hatever was the ultimate object of this conspiracy, the means adopted for its accomplishment reached beyond the boundaries of Colorado.” 324 U.S. at 298, 65 S.Ct. at 664.

      . Cf. Rasmussen v. American Dairy Association, 472 F.2d 517, 527 (9th Cir.), cert. denied, 412 U.S. 950, 93 S.Ct. 3014, 37 L.Ed.2d 1003 (1973); “The basic issue ... is the extent to which a prohibition of the defendants’ specific conduct is justifiable as a means of protecting the specific line of interstate commerce involved." (emphasis added).

      . In Lieberthal the conspiracy was aimed at preventing the opening of one bowling alley, as here it is aimed at preventing expansion of one hospital. In Page the court found that a conspiracy to control legal advertising in a local market would not substantially affect commerce in newsprint and other products, since by far the major consumers of such products remained untouched by the conspiracy; here, as noted in the body, the failure of Mary Elizabeth to expand could have no noticeable detrimental effect on the various lines of commerce suggested by HBC.

      . The Court noted that § 2(a) of the Robinson-Patman Act forbids “any person engaged in commerce, in the course of such commerce” to make price discriminations “where either or any of the purchases involved in such discrimination are in commerce” and where the effect of the discrimination is to suppress competition “in any line of commerce.” It also recited that § 3 of the Clayton Act renders unlawful tie-in sales or exclusive dealing arrangements by “any person engaged in commerce” where the effect “may be to substantially lessen commerce or create a monopoly in any line of commerce,” and that § 7, forbidding certain acquisitions, similarly applies to acquirers engaged “in commerce” and prohibits them from acquiring the stock or assets of another corporation engaged “in commerce” where the effect may be substantially to lessen competition “in any line of commerce in any section of the country.” It concluded that application of both Acts turned on the concept of “in commerce,” defined in § 1 of the Clayton Act as “trade or commerce among the several States and with foreign nations . . .”

      . Of course, if the rendition of local hospital services was “in commerce,” the Sherman Act would clearly apply. But no court has so held, and I think that the majority’s conclusion that HBC’s activities are not “in commerce” is a correct one.


author: RONEY, Circuit Judge:

text:
    William H. ADKINS, Plaintiff-Appellant, v. The DUVAL COUNTY SCHOOL BOARD et al., Defendants-Appellees. Jeff Dolan WILLMON, Jr., Plaintiff-Appellant, v. NASSAU COUNTY SCHOOL BOARD, Defendant-Appellee. Ruth B. WILSON, Plaintiff-Appellant, v. The DUVAL COUNTY SCHOOL BOARD, Defendant-Appellee.
    No. 74-1653.
    United States Court of Appeals, Fifth Circuit.
    April 21, 1975.

      William H. Maness, Jacksonville, Fla., for plaintiffs-appellants.
    Richard H. Frank, Tampa, Fla., amicus curiae.
    William L. Allen, Asst. Gen. Counsel, Daniel U. Livermore, Jr., Jacksonville, Fla., for Duval County School Bd., and others.
    Brian T. Hayes, Tallahassee, Fla., for Nassau County School Bd.
    Before TUTTLE, RONEY and GEE, Circuit Judges.
   RONEY, Circuit Judge:

Three suits consolidated on appeal present this single issue: Is a Florida school board a “person” within the meaning of 42 U.S.C.A. § 1983, which provides:

Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress. (Emphasis supplied)

Concluding on the authority of Kenosha v. Bruno, 412 U.S. 507, 93 S.Ct. 2222, 37 L.Ed.2d 109 (1973), that a county school board is not a “person” within the meaning of that statute, the district court dismissed the cases for want of subject matter jurisdiction, the school boards being the sole defendants and no other ground of jurisdiction having been asserted. We affirm.

Plaintiffs’ substantive claims for reinstatement, back pay and other relief, along lines frequently held by federal courts to be cognizable under 42 U.S. C.A. § 1983, see, e. g., Perry v. Sindermann, 408 U.S. 593, 92 S.Ct. 2694, 33 L.Ed.2d 570 (1972); Board of Regents v. Roth, 408 U.S. 564, 92 S.Ct. 2701, 33 L.Ed.2d 548 (1972), are not material to the disposition of this case. The procedural history is important, however, in that it has made the issue in this case clear and direct.

Wilson and Adkins filed separate suits under 42 U.S.C.A. § 1983 alleging causes of action against the Duval County School Board, the school superintendent and the principal of the school in which each had last taught. Jurisdiction was alleged only under 28 U.S.C.A. § 1343(3), with no allegation of jurisdiction under the general federal question statute, 28 U.S.C.A. § 1331. At a hearing on defendants’ motion to dismiss, both plaintiffs requested and obtained a dismissal without prejudice of their claims against the individual defendants. The only defendant left in each suit is the Duval County School Board. Similarly, Willmon’s original complaint alleged a § 1983 claim against the Nassau County School Board alone, predicating jurisdiction solely under 28 U.S.C.A. § 1343(3).

All three cases thus achieved an identical posture relative to the jurisdictional question. The parties to the three suits stipulated that the district court could consolidate them for purposes of ruling on the defendants’ motions to dismiss for want of subject matter jurisdiction ’ in light of the Supreme Court of the United States’ decision in Kenosha. A single order dismissed all three cases and entered judgment for the defendants.

The critical issue as to subject matter jurisdiction is whether a Florida school board falls within the ambit of the United States Supreme Court cases holding that certain other governmental entities were not intended by Congress to be “persons” against whom § 1983 actions could be brought.

In Monroe v. Pape, 365 U.S. 167, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961), the Supreme Court by unanimous decision held that a municipality is not a “person” within the statute and dismissed a § 1983 damage claim against the City of Chicago. Similarly, in Moor v. County of Alameda, 411 U.S. 693, 93 S.Ct. 1785, 36 L.Ed.2d 596 (1973), the Court held there to be no cause of action for damages under § 1983 against a California county.

Most lower courts, including ours, construed Monroe v. Pape to preclude damage actions against the governmental entities, but not equitable actions. See, e. g., Harkless v. Sweeny Independent School District, 427 F.2d 319 (5th Cir. 1970), cert. denied, 400 U.S. 991, 91 S.Ct. 451, 27 L.Ed.2d 439 (1971); cf. Moor v. County of Alameda, 411 U.S. at 695 n. 2, 93 S.Ct. 1785. By treating the award of back pay as an equitable remedy, such courts afforded a § 1983 cause of action through § 1343 jurisdiction to vindicate teachers’ claims against school boards and school officials for Fourteenth Amendment violations that could not achieve the $10,000 stature required to give the courts federal question jurisdiction under § 1331. See, e. g., Horton v. Lawrence County Board of Education, 449 F.2d 793, 795 (5th Cir. 1971); Hark-less, supra, 427 F.2d at 324.

Then the Supreme Court disapproved this bifurcated approach to a § 1983 cause of action, holding that a municipality was not a “person” within the meaning of the statute regardless of the kind of relief sought against it. Kenosha v. Bruno, 412 U.S. 507, 93 S.Ct. 2222, 37 L.Ed.2d 109 (1973). The question which this Court had avoided in Harkless by application of the legal-equitable relief distinction once more became a viable issue: Is a school board a “person” amenable to any suit under § 1983? This Court remanded Campbell v. Mazur, 486 F.2d 554 (5th Cir. 1973), so that the district court could consider the effect of Kenosha on our decision in Harkless. We have recently decided that a Texas school district which, “under Texas law, is in the nature of a municipality” is not a “person” as that term is used in § 1983. Sterzing v. Fort Bend Independent School District, 496 F.2d 92, 93 n. 2 (5th Cir. 1974).

The appellants and amicus teachers’ association have argued the significance of this issue because of the number of school desegregation cases in which the school board has been a defendant. The possible impact on “school decisions” of a holding that a school board is not a “person” under § 1983 is difficult to evaluate for a number of reasons. Many school cases involve Fourteenth Amendment claims for which jurisdiction exists under the federal question jurisdiction of the federal courts as provided in § 1331. Most school cases also named individual parties who are “persons” against whom effective relief was obtained, so that the presence or absence of the school board as a governmental entity did not materially affect the result. Many cases do not . even discuss jurisdiction in granting or denying relief. In this case, however, the suit is solely against the school board, the cause of action is restricted to a claim under § 1983, and the jurisdiction is based solely on § 1343.

Two things should be noted to the argument concerning the far-reaching effect of the district court’s decision. First, the issue is not whether the school board can be sued. Personal jurisdiction of the defendants is not questioned. We are confronted only with subject matter jurisdiction, i. e., whether a cause of action against a school board recognizable in federal courts was created by § 1983. Second, our responsibility is not to decide whether Congress could or should establish such a cause of action, or whether a similar cause of action may exist under some other jurisprudence, but whether Congress in fact did direct a § 1983 cause of action against school boards. Unlike constitutional decisions, our determination here can be corrected by Congress itself if it desires another result.

We can find no controlling distinction between a Florida school board, as a governmental entity, and a Florida municipality or a Florida county, that would suggest that Congress would include one within the purview of the statute, and not the other two. All three find authority for their existence in the Florida Constitution. See F.S.A.Const. Art. VIII, §§ 1 and 2 and Art. IX, § 4. Counties, municipalities and school districts are granted the power in the Constitution to participate in establishing taxes and tax rates for their respective purposes, F.S.A.Const. Art. VII, § 9, which power is exercised by their respective governing bodies. See F.S.A. § 200.011. The legislature has provided each with significant governmental power with which to operate for its respective purposes. See F.S.A. § 125.001 et seq. (counties); F.S.A. § 165.01 et seq. (municipalities); F.S.A. § 230.01 et seq. (school districts).

In an exercise of legislative discretion the Florida legislature has chosen to designate the school board as a “body corporate” for all purposes, including institution and defense of suits involving official action. See F.S.A. § 230.21. It has similarly chosen to have the governing authority of a municipality or county generally operate in the name of the county or municipality, including suing and being sued as a “body corporate.” See F.S.A. §§ 125.15, 165.08. Each of these governmental entities, a school district, a county and a municipality, can operate as an entity only through its designated governing authority, the school board, the county commissioners, and the city council. The fact that the Florida legislature has designated the governmental entity to be sued in its own name in two instances and in the name of the governing authority in the third does not change the character of the suit. The suit, however styled, is against the governmental subdivision itself in each case.

We have recently held that the various arms of state government, such as the Department of Highways, are not “persons” within the meaning of § 1983, Cheramie v. Tucker, 493 F.2d 586, 587— 588 (5th Cir.), cert. denied, 419 U.S. 868, 95 S.Ct. 126, 42 L.Ed.2d 107 (1974). That decision would seem to follow logically from Monroe, Moor, and Kenosha. All of those precedents dealt specifically with political subdivisions of a state, i. e., municipalities and counties. If the subdivisions of a state were not “persons” under § 1983, the state itself was obviously not such a “person” and therefore, the entities through which the state functions should be excluded. An analysis of the approach taken by the Supreme Court in Kenosha and Monroe, and that Court’s expression of what it views the legislative intent to have been when Congress passed the Civil Rights Act of 1871, seems to require the conclusion that § 1983 was similarly not directed at county school boards.

In Monroe, Justice Douglas discussed the legislative history of the bill which became the Civil Rights Act of 1871 in order to arrive at a construction of the word “person” in that statute consistent with Congressional intent. Justice Douglas noted particularly the defeat in the House of Representatives and the ultimate elimination of the Sherman Amendment which would have unequivocally extended liability to any “county, city or parish” for the violation of certain civil rights. In both houses of Congress, the amendment met with strong opposition because of the potentially debilitating effect damage judgments might have on the governmental entity. See Kenosha, 412 U.S. at 517-520, 93 S.Ct. 2222 (Appendix to Douglas, J., dissenting in part).

The Sherman Amendment was adopted by the Senate, after which the House rejected it. The Conference Committee agreed on another version, but the House also rejected the Conference report. In a second conference the Sherman Amendment was dropped and the statute which is now 42 U.S.C.A. § 1986 was substituted. See Monroe, 365 U.S. at 188-191, 81 S.Ct. 473. That section, like § 1983, speaks only of liability of “persons,” not cities or counties. Considering this background of adamant Congressional refusal to extend liability for civil rights violations to governmental entities when the issue was specifically before Congress, the Supreme Court refused to construe the general term “person” to include such entities. See Kenosha, 412 U.S. at 513, 93 S.Ct. 2222; Monroe, 365 U.S. at 191, 81 S.Ct. 473.

Although the Sherman Amendment would have created vicarious liability against the governmental entities, without fault, 365 U.S. at 188, n. 38, 81 S.Ct. 473, this ground of liability was not the sole reason for the amendment’s defeat. The other general concerns which led Congress to reject the Sherman Amendment, particularly the fear of economic destruction of state government by damage awards, are no less important when the governmental entity is a school board than when it is a city. In fact, a school board, which might not be authorized to fill its own coffers, could have more difficulty in meeting damage claims and finding the funds necessary to provide adequate education. While not specifically addressing the issue as it did with cities and counties, Congress seemingly did not intend the term “person” when used in the Civil Rights Act of 1871 to encompass a school board or other such governmental entity. While Congressional fear of the possible effect of damage recoveries against governmental entities was partially the basis for the construction of the term “person” by the Supreme Court, Kenosha made clear that the term, however defined, has no bifurcated meaning depending on the remedy sought by the plaintiffs. We conclude, therefore, that the district court correctly dismissed these actions for lack of jurisdiction under 28 U.S.C.A. § 1343(3), since the school boards were not “persons” subject to § 1983 suits.

Although there is no Supreme Court holding squarely in point, plaintiffs present an approach to the Court’s decisions which they assert demonstrates that the Court has already decided that school boards are “persons” under § 1983. They first note that the Supreme Court raised the jurisdictional issue sua sponte in Kenosha, 412 U.S. at 511, 93 S.Ct. 2222, making it clear that the Court is ever vigilant to keep the federal courts within their Congressionally proscribed jurisdiction. The Supreme Court in at least three pre-Kenosha cases and two post-Kenosha cases has reached the merits of claims against school boards without raising the jurisdictional issue. See Perry v. Sindermann, 408 U.S. 593, 92 S.Ct. 2694, 33 L.Ed.2d 570 (1972); Board of Regents v. Roth, 408 U.S. 564, 92 S.Ct. 2701, 33 L.Ed.2d 548 (1972); Tinker v. Des Moines Independent Community School District, 393 U.S. 503, 89 S.Ct. 733, 21 L.Ed.2d 731 (1969) (the pre-Kenosha cases); Cleveland Board of Education v. LaFleur and Cohen v. Chesterfield County School Board, 414 U.S. 632, 94 S.Ct. 791, 39 L.Ed.2d 52 (1974) (the consolidated post-Kenosha cases). ' Plaintiffs suggest that even though it is possible that the Court was not specifically attuned to the jurisdictional issue in Perry, Roth and Tinker, it is inconceivable that the Court could have overlooked it in LaFleur and Cohen. The latter two cases were argued on October 15, 1973, a mere six months after the decision was rendered in Kenosha on April 18, 1973, and the composition of the Court was identical at both times. Additionally, the writer for the majority in Kenosha, Justice Rehnquist, authored a dissent on the merits in LaFleur without mentioning the possible lack of jurisdiction. All of this, plaintiffs contend, clearly shows that the Supreme Court has decided the issue adversely to the defendants in this case.

On the contrary, the existence of multiple parties in LaFleur and Cohen is sufficient to demonstrate that the Court has not ruled on the matter. An argument similar to plaintiffs’ regarding municipalities instead of school boards apparently was made and rejected in Monroe. The Supreme Court had previously reached the merits of substantive claims in two cases in which municipalities were defendants, see Holmes v. City of Atlanta, 350 U.S. 879, 76 S.Ct. 141, 100 L.Ed. 776 (1955); Douglas v. City of Jeannette, 319 U.S. 157, 63 S.Ct. 877, 87 L.Ed. 1324 (1943), but the Court in Monroe rejected the existence of any sub silentio ruling on the issue which it decided:

In a few cases in which equitable relief has been sought, a municipality has been named, along with city officials, as defendants where violations of 42 U.S.C. § 1983 were alleged. See, e. g., Douglas v. City of Jeannette, 319 U.S. 157, 63 S.Ct. 877, 87 L.Ed. 1324; Holmes v. City of Atlanta, 350 U.S. 879, 76 S.Ct. 141, 100 L.Ed. 776. The question dealt with in our opinion was not raised in those cases, either by the parties or by the Court. Since we hold that a municipal corporation is not a “person” within the meaning of § 1983, no inference to the contrary can any longer be drawn from those cases.

Monroe v. Pape, 365 U.S. at 191 n. 50, 81 S.Ct. at 486. Thus, the presence of parties other than the municipalities in Holmes and Douglas enabled the Court to reach the merits of the plaintiffs’ claims despite the municipality-“person” issue. Likewise in each of the cases argued by plaintiffs here, the school board was only one of a number of defendants, various school officials having been joined as individuals or in their official capacities. For example, in Cohen the Superintendent of the Chesterfield County Schools was a party defendant. Cohen v. Chesterfield County School Board, 326 F.Supp. 1159 (E.D.Va.1971), rev’d, 474 F.2d 395 (4th Cir. 1973) (en banc), rev’d, 414 U.S. 632, 94 S.Ct. 791, 39 L.Ed.2d 52 (1974). Similarly, LaFleur sued not only the Cleveland Board of Education as an entity, but also the members of the Board, the Superintendent, the Assistant Superintendent-Personnel, the Supervisor-Secondary Organizations and the Principal of the school from which she was discharged, each both individually and in his respective official capacity. Complaint at p. 1, LaFleur v. Cleveland Board of Education, 326 F.Supp. 1208 (N.D.Ohio 1971) (No. C71-292), rev’d, 465 F.2d 1184 (6th Cir. 1972), aff’d, 414 U.S. 632, 94 S.Ct. 791, 39 L.Ed.2d 52 (1974).

The § 1983 issue was not presented by the parties in these cases. To raise it sua sponte would have been a futile exercise, since even had the Court raised the issue and decided that there was no § 1983 claim against the school board, there would have remained valid federal claims against some of the parties just as in the two pre-Monroe municipality cases, Holmes and Douglas. See Monroe, 365 U.S. at 187, 81 S.Ct. 473. The situation was the same in the post-Monroe, pre-Kenosha cases relied on by the plaintiffs, Perry v. Sindermann, supra, Board of Regents v. Roth, supra, and Tinker v. Des Moines Independent School District, supra. In none of those cases would a determination of the issue have resolved the conflict between the parties.

Conversely, once the Supreme Court concluded in Kenosha that no potential § 1983 claim was stated against the city upon which to base § 1343 jurisdiction, the federal court was without any jurisdiction to proceed to the merits. The Court discussed the possibility that on remand the Kenosha plaintiffs might be able to prove some other basis for federal jurisdiction and thereby avoid dismissal of their complaints. See Kenosha, 412 U.S. at 514, 93 S.Ct. 2222. The absence of any practical effect in deciding it lacked jurisdiction over one defendant in a suit which also involved other defendants who were clearly “persons” under § 1983 and from whom full relief assumedly was obtained, as in Cohen, LaFleur and the other cases, when contrasted with the situation resulting from the jurisdictional decision in Kenosha, satisfactorily explains why the Supreme Court raised the issue sua sponte in the Kenosha case, and not in the others. See Mitchell v. West Feliciana Parish School Board, 507 F.2d 662 (5th Cir. 1975). We place no weight, therefore, on the failure of the Supreme Court to raise sua sponte the jurisdiction over one defendant in any case where other defendants were present for whom the suit would have had continuing vitality even without the putative “non-jurisdictional” party.

The plaintiffs in the instant cases chose not to seek jurisdiction over the school boards under the general federal question jurisdiction even though offered an opportunity to file amended complaints, so we need not consider the possibility of such jurisdiction. Cf. Kenosha, 412 U.S. at 514, 93 S.Ct. 2222; Ybarra v. Los Altos Hills, 503 F.2d 250, 253 (9th Cir. 1974). As already stated, in all of the cases before us none of the individual members of the three school boards and no officials of the boards were defendants when the cases were dismissed. Had there been individual party defendants, whom this Court has previously held to be “persons” for the purposes of 42 U.S.C.A. § 1983, the trial court could not, of course, have dismissed the suits for failure to allege a proper jurisdictional basis. Sterzing v. Fort Bend Independent School District, 496 F.2d 92, 93 n. 2 (5th Cir. 1974); cf. United Farm Workers of Florida Housing Project, Inc. v. City of Delray Beach, 493 F.2d 799, 802 (5th Cir. 1974).

Affirmed.

      . Jurisdiction to vindicate, in federal courts, civil rights violations such as those alleged here under § 1983 is provided by 28 U.S.C.A. § 1343, regardless of the amount in controversy. Subdivision (3) of § 1343 provides:
      To redress the deprivation, under color of any State law, statute, ordinance, regulation, custom or usage, of any right, privilege or immunity secured by the Constitution of the United States or by any Act of Congress providing for equal rights of citizens or of all persons within the jurisdiction of the United States;

      . A primary procedural difference between jurisdiction 28 U.S.C.A. § 1343 and 28 U.S.C.A. § 1331 is the need for an amount in controversy in excess of $10,000 exclusive of interest and costs under the latter provision. Section 1331 provides, in pertinent part:
      The district courts shall have original jurisdiction of all civil actions wherein the matter in controversy exceeds the sum or value of $10,000, exclusive of interest and costs, and arises under the Constitution, laws, or treaties of the United States. . . .