McCarthy v. Recordex Service, Inc.

resources; foremost, lenity ap- income and I would the rule of defendant’s First and Instead, and, overrule Eckeverri. I hold ambiguous would plies only when a statute is that, Congressional requiring unanimity intent view that absent light of the traditional verdict, identity predicate jury unanimity as to the general to the required is unanimity ambiguous. findings, specific a instruc- cannot be deemed factual CCE statute findings predicate a is not tion on statute’s acknowledges, majority as the required. authority rule of applying there is no lenity posed present in the case. to the issue Because there was no error committed Nevertheless, majority argues that the court, I would not reach the issue the district apply lenity should here because Although rule of I of harmless error. concur “conceptually analo- applied majority has been ultimate result reached single conviction, a criminal act gous whether sustaining respectful- situation: I Edmonds’ violations of a stat- majority’s holding constitutes one or more ly from the dissent 820-21). see, I fail (Maj. Op. at unanimity ute.” requires as to the identities of the however, single how the issue of whether constituting “continuing predicate acts one or more viola- criminal act constitutes prong series” of the CCE statute. analogous is at all

tions of statute SLOVITER, C.J., GREENBERG, sought present issue of whether facts JJ., NYGAARD, ROTH, join in ALITO and or are not essential proven be at trial are so concurring dissenting opinion. an element of the offense such proof unanimity required. jury is or is not majority invokes a number of The also proposition that the rule of

cases for the warning

lenity requires fair as to the harsh- given for a offense. penalties of criminal ness McCARTHY; Colville; Mary Guy Ruth there, majority makes the tenuous From Ormsby; Tomasetti; Edward Carmen protec- procedural because connection that Hoffman, Joseph Appellants, penalty that a will tions affect the likelihood imposed, point, some differences “[a]t signifi- procedural protections become as SERVICE, INC.; Copyright, RECORDEX penalties, and the need for cant as different Inc.; Corp., Headquar Smart National (Maj. Op. warning just as critical.” fair Copying; ters Medical Records Medfax 821-22).6 argument is forced and fails This Correspondence Incorporated; Hospital protections” persuade. “procedural The Copiers; Mercy Corporation Health the likelihood that a defen- at trial affect Pennsylvania, Misericor Southeastern (a jury ques- be convicted at trial dant will Hospital Division; Hospi dia Methodist tion), separate issue from what but this is tal; Hospital; Hahne Graduate (a imposed statutory penalties will be and/or University Hospital; mann The Lower matter). judicial Hospital. Bucks No. 95-1005. III. Appeals, United States Court of required specif- Congress has not Because Third Circuit. respect any predi- of the unanimity

ic underlying findings the CCE cate factual Argued Jan. 1996. statute, there no basis for our and because April Decided requiring unanimity as to the identities require una- predicate acts when we do not super-

nimity of the five as to the identities individuals, as to the identities

vised jury. Presumably, "procedural protection” instruction to the specific unanimity majority has in mind is PA, Corpora-

adelphia, Appellee Smart tion. Mattson, B.

Christopher W. Katherine Cohen, Kravitz, Barley, Snyder, & Senft Lancaster, PA, Appellee Hospital for Corre- Copiers, spondence Inc. Lieberman, Schnader, Harrison,

Alan M. PA, Lewis, Appel- Segal Philadelphia, for & Mercy Corporation lee Health of Southeast- Pennsylvania, Hospital Divi- ern Misericordia sion. Jr., Williams, Mengel, &

Edward C. White PA, Philadelphia, Appellee for Methodist Hospital. Gelman, Creato, Mesirov,

Anthony E. Jaffe, Jamieson, PA, Philadelphia, & Cramer Hospital. Appellee for The Graduate H. (Argued), Michael T. Martin Scott Karo, Reed, Smith, McClay, Phila- Shaw & PA, delphia, Appellee for Hahnemann Uni- versity Hospital. Chancier, Sprague, B. Kathleen

Jonathan Schell, PA, Philadelphia, Appellee Post & for Hospital. The Lower Bucks STAPLETON, Before: COWEN GARTH, Judges. Circuit OPINION GARTH, Judge: Circuit appeal requires The instant us to decide plaintiff-clients, whether the whose purchased photocopies of the clients’ purpose prosecuting records for the personal injury malprac- clients’ and medical claims, bring tice an anti- against photo- trust action the sellers of (Argued), R. Richard C. Stephen Bolden copies. We hold that such clients lack PA, Ferroni, Spalding, Philadelphia, Fell & bring treble-damages claim be- Appellants. purchasers,” cause are not “direct Gerstein, Nancy M. Law Leslie Offices Illinois, required by Illinois Brick Co. Wasser, PA, Philadelphia, Appellees D. U.S. 52 L.Ed.2d 707 Services, Inc., Copyright, Inc. and Recordex (1977). However, we also hold that these Medfax, Inc. seeking injunc- clients are not barred Marion, Zalesne, Clayton tive relief under section 16 of the David H. David Mont- Rhoads, McCracken, gomery, Phil- Act. Walker & plaintiffs,

I. Each of the named at some time years filing within four before the instant Mary McCarthy,1 Guy Ruth Col- action, patients hospitals owned ville, Ormsby, Edward Carmen Tomasetti2 Hospital plaintiff Each Defendants. had (“M F”), Matty retained either Joseph Hoffman filed a three-count com- & Ferroni & firm, Jersey a New Spalding law or Fell & 19, 1993, plaint, January against five hos- (“F S”), Philadelphia firm, & to file a (the defendants”)3 pitals “Hospital and five personal injury malpractice or medical claim (the copy-service companies “Copy Service ease, on his or her behalf. In each after the defendants”).4 complaint asserted viola- particular plaintiff signed had a medical con- Act, tions of the Sherman Antitrust 15 U.S.C. authorizing form appropriate hospi- sent (count I);5 §§ 1 and 2 violations of the Rack- records, tal to release his her medical Influence, eteering, Corrupt Organiza- and plaintiffs attorney requested photocopies of (RICO), §§ tions Act 18 U.S.C. 1962 and hospital copy the client’s records. The ser- (count II)6; and violations of the civil case, company, in vice each billed the attor- (count III). laws, § rights 42 U.S.C. ney directly.7 complaint complaint and amended plaintiffs Each of the five had entered into relief, sought injunctive money damages, contingent-fee agreement a with either M & attorneys’ certification and fees. In class F F exception McCarthy, or & S. With the of essence, plaintiffs allege Hospital the none of obligated the were under Copy Defendants and Service Defendants agreement the relevant retainer to reimburse charge prices pho- conspired to excessive for costs, including photo- the law firm for tocopies requested by pa- of medical records issue, copying expenses monetary unless a patients. recovery particular or tients former favor of the client was McCarthy subsequent illegally prices 1. died to the institution of er in order to extract unlawful for persona] performance litigation. representative copy of said services.” Com- this A has ¶ plaint formally at 52. been named for her but has not been record, substituted on the as of the date of this alleges complaint 6. The a violation of 18 U.S.C. appeal. presume § a nonexistent statute. We pur- intend to state a civil RICO claim commencing 2. Tomasetti died after this action. § suant to 18 U.S.C. 1964. personal representative named as No has been of appeal. the date of this F, requested 7. Tomasetti retained M & which Hahnemann; copies patient records from Re- Mercy Hospital 3. The are Health Defendants provided photocopying cordex and services Corporation Pennsylvania, of Southeastern Mi- charged $44.40. & & M F Hoffman retained M ('‘Misericordia”); Hospital sericordia Division F, requested copies which of records from Lower ("Methodist”); Hospital Methodist the Graduate Bucks; performed photocopying and MedFax (“Graduate"); University Hospital Hahnemann charged $19.22. & and M F Both Tomasetti ("Hahnemann”); Hospital and the Bucks Lower & Hoffman settled their cases and reimbursed M (“Lower Bucks"). Hospital They hospital are all proceeds photo- F out of their settlement for operate hospitals corporations that in the Com- copying costs. Pennsylvania. monwealth of F, requested cop- retained M & which Colville Methodist; Smart, performed ies from which Copy 4. The Service Defendants are Recordex photocopying, charged Ormsby Services, $25.49. M & F (“Recordex"), CopyRight, Inc. Inc. F, copies requested M & which ("Smart”), also retained ("CopyRight”), Corporation Smart Graduate; records, photocopied from HCC Medfax, ("MedFax”), Hospital Inc. Corre- charging appeal $38.40. M & F At the time this ("HCC”). spondence, They Copiers all cor- filed, Ormsby had was neither Colville nor porations doing business in the Commonwealth settlement, reached a and neither had reim- Pennsylvania, who have entered into contracts copying expenses & F incurred. bursed M for Hospital perform with one of the Defendants Ormsby apparently personal has discontinued his cop- copying response requests services in for injury App. claim. at 536. ies of records. S, requested McCarthy retained F & which alleges specifically copies I 5. Count that the defendants of her medical records from Misericordia. conspira- responsible providing engaged CopyRight, in a "contract combination or which was for cy commerce”; effecting copying requests Miseri- [sic] in restraint of trade interstate services related to records, patient possess F&S$540. a billed F&S that "the defendants cordia eventually monopoly perfor- pay in the relevant for the refused to the bill but obtained the market 517-20, copying hospital patient opposing App. at mance of records, services of counsel. willfully pow- and have maintained that by McCarthy’s agreement copy hospital requested patients F records with & obtained.8 hand,

S, provided public “[t]he other entitled on the other members contract, recovery not relieve copy- of a shall absence such records. Under obligation paying [McCarthy] any from the company agreed photocopy service litigation proper other court costs and requested by patients or oth- medical records However, App; 498. investigative costs.”9 re- requestors. er The sole remuneration Bolden, S, at F partner a & Stephen R. Copy Defendants de- ceived Service despite the con- in an affidavit that admitted copying charges paid by the rived from the firm language, practice, in actual tractual requestors. App. sought reimbursement advanced never charged Patients or their the client did representation of costs where copies medical per page for records. $1 recovery: not lead to addition, typically paid a also retriev- Although express language under fee, hospital; al which was remitted to Contingent Agreement, Fee Fell & (i.e. a or “basic” fee flat fee “administrative” contractually entitled to seek Spalding copies), number of which unrelated even from client where reimbursement copy-service company; was retained representation that client has led to handling postage fees. funds; recovery as matter of Spalding has practice, actual where Fell & requestors charged were Certain “favored” obtaining recovery a been unsuccessful no at all.12 The a rate11 or fee reduced by way or of funds of settlement otherwise Hospital Defendants set schedule sought & has not reim- Spalding ... Fell charges, requestors who designating the copy- for the costs incurred bursement charged. Typically, would or would not be hospital ing a client’s records.... requests sixty percent more of the for App. 526.10 hospital records were nonbillable. Hospital had en- Each of Defendants practice Copy Plaintiffs claim subsi- into a contract with one tered pa- Defendants, dizing requestors charging certain granting Copy while Service Ser- right photo- agents or their an inflated fee violated the exclusive tients vice Defendant McCarthy award or settlement before de- 8. other than entered amount The four contingent agreements with litigation M & F. ducting expenses) plus expenses. into fee agreements, the law firm would Under these (33-1/3% fee for Tomasetti and receive its 40% Ferroni, F, partner a at 10. Richard C. M & plaintiffs) only three if it for each of the other similarly stated an affidavit that successfully litigated the case. Under or settled contract, M & F be entitled to would Colville's firm, not, sought had has [h]e nor his ever any recovery plus reimbursement of die 40% costs. The other (including reimbursement for costs costs of three contracts awarded M records) obtaining hospital copies of a client's (i.e. recovery percentage & M & F F a where has not from client there been percent- of its have to cover its costs out would age action in which he or his firm recover}’ award). of the settlement or share represented Contingent client and the has agreements entitled & F of the fee M None costs, Agreement al- Fee does not address of costs if the client failed reimbursement though responsible are advised clients provided: "If contract recover. Colville’s regardless of for costs outcome. charge recovery no there be there is no will App. 536. Likewise, App. 414. for rendered." services agreement stated: “If no monies Hoffman’s example, copy requests Medicare 11. For will be fee for are recovered there no services per page; and Work- billed seven cents agreement Ormsby’s App. rendered.” 433. paid Compensation Appeal Board a ten men’s recovery, similarly read: there is no there "If request regardless per flat fee of the num- dollar charges any App. Fi- are no for fees.” copied. agreement pages actually contingent nally, fee ber Tomasetti’s provided: attor- "If no monies are recovered ney for rendered.— to have no claim services example, physician’s hospitals, of- 12. For other necessary, Attorney all & to advance costs Shield, fices, Blue Blue Cross and Veteran’s App. 470. be reimbursed at settlement.” agencies re- and social service Administration military free. The and certain McCarthy ceived prevailed, would If F & S receive (calculated contingent copies. free based HMOs also received fee 1/3 equally in provides plied the RICO context. On De- Pennsylvania regulation, which 29, 1994, granted the district cember court part: relevant summary judgment all defendants on giv- patient designees shall be Patients or II, disposing count thus of all three counts of copy or a of their medical en access to complaint. timely filed in- records, Upon the death of a or both.... appeal. stant upon provide, patient, shall the executor of the decedent’s request, to II. executor, or, in of an

estate the absence responsible disposi- kin the next of jurisdiction The district court had over remains, all medical tion of the access to plaintiffs’ antitrust and RICO claims under patient. pa- records of the deceased 15; 1964; § § 15 U.S.C. 18 U.S.C. and 28 patient’s of kin tient or the next appellate jurisdic- § U.S.C. 1331. We have reproducing the charged for the cost of grant tion over the district court’s of sum- however, charges be rea- copies; shall mary judgment in favor of defendants under sonably making the related to the cost of § 28 U.S.C. 1291. copy. The issue of antitrust is a added). (emphasis § 28 Pa.Code 115.29 issue, legal plenary over which we exercise amended com- After filed an In re Iron review. Lower Lake Erie Ore pur- plaint, the defendants moved dismiss (3d Litig., Antitrust 998 F.2d Procedure suant to Federal Rule Civil — dismissed, -, Cir.1993), cert. U.S. 12(b)(6). court, by The district order dated -, 625, 652, 126 L.Ed.2d 5, 1993, August denied defendants’ motion to — denied, -, and cert. U.S. (RICO) (antitrust) II counts I dismiss 921, 127 L.Ed.2d 215 We also exer count III granted the motion to dismiss but grant plenary cise review of a district court’s (civilrights). summary judgment, applying the same 4, 1994, Subsequently, April on applied by the court. Ro standards district certify the case as a class action. moved to (3d Bezner, 1527, F.2d 1530 Cir. sen v. 996 18, 1994, in a Memorandum On November 1993); Philadelphia Newspa Koshatka v. Order, plaintiffs’ the district court denied (3d Cir.1985). Inc., 329, pers, 762 F.2d 333 motion for class certification. proper only Summary judgment is 1, 1994, Hahnemann April defendant On any genuine as to where “there is no issue judgment partial summary for filed a motion moving party material fact and ... (the claim), count I antitrust which was judgment matter of law.” entitled to as a joined eventually by all of the defendants 56(c). moving party bears The Fed.R.Civ.P. denied the except The district court Smart. proving genuine that no dis the burden of summary judgment in an partial for motion any to material fact. pute exists 5,1994. May order dated Inc., Lobby, Liberty 477 U.S. Anderson v. for re- Subsequently, Hahnemann moved 248, 106 2505, 2510, 242, L.Ed.2d 202 S.Ct. 91 8, 1994, July the district consideration. On (1986). Moreover, any to be inferences motion for re- granted court Hahnemann’s fight in the most drawn must be viewed summary judg- granted consideration and summary party opposing favorable to the defendants, I in favor of all ment on count 2509-10; judgment. at 106 at Id. S.Ct. holding lacked Radio Elec. Indus. Co. v. Zenith Matsushita purchasers” of they were not “direct because 574, 587, 106 1348, 1356, Corp., 475 S.Ct. U.S. records, meaning within the (1986). L.Ed.2d 538 Illinois, Illinois Brick Co. v. U.S. (1977). 2061, 52 L.Ed.2d 707 S.Ct. III. 12, 1994, December all of defen- On A. summary judg- joined in a motion for

dants claim, years ago, Supreme twenty remaining on the Almost ment on the RICO pur- the so-called “direct standing principles ap- Court articulated theory that antitrust Id. at rule, vate antitrust claim. at S.Ct. antitrust doctrine an chaser” allowing purchasers The Court reasoned downstream indirect that barred private pass-on would diminish anti- defense bringing antitrust claim. See Illi from an Illinois, thereby increase the 720, 744, trust enforcement 431 U.S. Brick Co. v. nois laws violators of antitrust 2073-74, likelihood that 52 L.Ed.2d 707 97 S.Ct. escape liability. Id. would allowing an Recognizing that indirect claim for the purchaser to antitrust assert BHck, ad- Supreme Court In Illinois overcharge portion “passed on” to the corollary problem dressed create an intracta purchaser would indirect offensive use of faced Hanover Shoe: tracing apportioning dam problem ble theory re- pass-on by purchasers indirect ages between different injuries “passed damages treble for on” cover distribution, Court chose chain of by in the distribution them intermediaries enunciating bright- by avoid this morass brought BHck involved a suit chain. Illinois immediately purchaser rule that line govern- of Illinois and 700 local the State alleged monopolist may downstream from against group of concrete mental entities action. bring an antitrust Id. manufacturers, allegedly who en- block had price-fixing conspiracy. in a U.S. gaged BHck, the a decade before Illinois Almost 726-27, at at 2064-65. The State S.Ct. Supreme Court laid the foundation for municipalities general hired the local had requirement purchaser” standing “direct large contractors several construction Shoe, Shoe Machin- Hanover Inc. United Chicago at projects in Id. area. ery Corp., 392 U.S. 88 S.Ct. contractors, general at 2064-65. (1968), rejected a “pass- which L.Ed.2d turn, masonry had subcontracted the work proffered on” an antitrust defen- defense masonry pur- certain contractors who had plaintiff that the was dant who claimed allegedly overpriced from chased blocks damages “passed costs entitled to treble conspirators. of Illinois Id. The State 487-89, Id. on” its customers. governmental the local entities were thus Shoe, plaintiff Hanover at 2228-29. block, purchasers of concrete two indirect Shoe, Inc., manufacturer, Hanover shoe chain down the distribution levels Clayton brought suit under section 4 of the Id. manufacturers. Machinery Corp. against Act United Shoe (USMC), a distributor of manufacturer and governmental Illinois and the other entities alleging had machinery, that USMC shoe part overcharge had claimed that or all of the machinery industry by monopolized the shoe passed by the been on subcontractors equipment requiring refusing to sell its general Id. at contractors. at 97 S.Ct. at equipment instead. Id. result, users to lease the plaintiffs, according As a 486-87, argued 88 S.Ct. at 2227-28. USMC for the overpaid had concrete block recoup Hanover had been able that Shoe The than three million Id. more dollars. by charging its its more for losses customers claim, holding that indi- Court dismissed the any cogni- and thus did not suffer shoes may purchasers not for antitrust rect sue injury passed it zable because had on damages. Id. at at S.Ct. 2069-70. overcharge illegal to its customers. allegedly explained The Court in Illinois BHck that 487-88, at Id. at 88 S.Ct. by Hanover the outcome was dictated Shoe judicial consistency pass-on principles that rejected USMC’s theo- The Court prohibit the offensive ry, entertaining compelled such a de- Court explaining that theory pass-on disal- proof as to use of where had fense would raise difficult issues pass-on doc- overcharge passed the defensive use of the the amount of the lowed whether, overcharge, in a similar factual Id. at Hanover trine situation. absent further Id. at 2066-67. The Court prices. could raised its at 489- S.Ct. Shoe have latter while explicated permitting The also that S.Ct. at 2228-32. Court disallowing buyers the former would create risk expressed that concern downstream application of tiny multiple liability: in a “A one-sided have “a stake lawsuit” would substantially prosecute pri- little Hanover -Shoe increases and thus incentive to enforcement, adjudications private tives for antitrust inconsistent possibility of —and liability regulated pass multiple public absent because utilities therefore of unwarranted by presuming percent that one on one hundred of their costs to for the defendant — (the consumers, purchaser) entitled to plaintiff actually direct are the that who ones recovery preventing the defendant injury. forcefully full while The suffer antitrust Court against oth- using presumption rejected that argument, opining that “[a]l- plaintiff...Id. er though the rationales of Hanover Shoe and apply equal Brick with force Illinois danger dupli- posited The State instances, in find it all we inconsistent recovery by appor- could be avoided cative any precedent imprudent event to damages to the con- tioning the attributable exception regulated public create an utili wrongful manufacturers’ conduct. crete-block 208, 110 ties.” Id. at at 2812-13. Court, however, rejected ar- the State’s gument purchasers indirect should be applied We Illinois Brick’s antitrust of the over- to recover the fraction allowed standing principle on several occasions. For them, charge “passed explaining: on” example, Paper Mid-West Products Co. pass-on Permitting the use of theories Inc., (3d Group, Continental 596 F.2d 573 essentially treble- ... would transform Cir.1979), we relied on Illinois Brick hold- damages into massive efforts to actions ing indirect of consumer recovery among potential apportion the all bags treble-damages could not maintain part plaintiffs that have absorbed would against bags. of such suit manufacturers purchasers to overcharge Paper, at 575. In the defen- —from Id. Mid-West to ultimate consumers. How- middlemen manufactured so-called consumer dants attempt allocate the appealing ever multilayered paper bags bags single or — theory, it overcharge might seem in would foods, coffee, cookies, packaging pet used for complexity add whole new dimensions plaintiff- chemicals and the like. Id. The treble-damages seriously under- suits and grocery purchased empty stores either con- mine their effectiveness. (which they package bags sumer used to Id. at 97 S.Ct. at 2070. products) their own from middlemen and pre-pack- products that were wholesalers UtiliCorp Subsequently, Kansas v. Unit aged bags for resale to their consumer ed, Inc., 2807, 111 110 S.Ct. U.S. reviewing After customers. Id. at 575-76. (1990), its L.Ed.2d 169 the Court reaffirmed Brick, teachings we deter- of Illinois rule, purchaser” commitment to the “direct purchaser” rule mined that the “direct exception to Illinois refusing to carve out an treble-damages claims of all of the barred the the full cost of the Brick for situations where Paper plaintiffs (except Products Mid-West (and percent one hundred product hence Company, purchased which had consumer overcharge) any passed had on to the been subsidiary bags directly from a of one of purchaser. Id. at indirect defendants). Id. at 575. UtiliCorp, In the of Kansas 2816-17. States Missouri, patriae, acting parens Merican, Similarly, Caterpillar v. Inc. of their brought an antitrust action on behalf (3d Co., Cir.1983), 713 F.2d 958 cert. Tractor residents, company claiming pipeline that a 1024, 1278, denied, 465 U.S. S.Ct. gas producers conspired to in and five had (1984), non-factory-authorized L.Ed.2d 682 price gas that flate the of the natural dealers, gener purchased electrical who had supplied public utilities. Id. at to for resale ators from authorized dealers utilities, according at 2810-11. These S.Ct. markets, alleged Caterpillar, the foreign that States, passed full amount of had on the generators, manufacturer of these electrical overcharge to their and com residential illegally imposed penalty on its dealers had Id. mercial customers. prevent discourage or the dealers from to independent Caterpillar products to argued selling the con- Kansas and Missouri Brick, Id. at 960. The district court namely the marketers. cerns voiced Illinois standing plaintiffs had under of mul- held that the apportionment, the risk difficulties nonfactory-autho- Brick because the recovery of incen- Illinois tiple and the diminution AGC, plaintiff-unions, representing In target[s] “direct of an were the rized dealers workers, an as- at sued conspiracy.” Id. 962. We re- California construction unlawful versed, unions purchaser, employers with whom the holding that an indirect sociation of bargaining agree- con- target” if antitrust had into collective even a “direct entered 522-24, spiracy, standing under Illinois Brick. at 900-01. lacked ments. at 103 S.Ct. Id. alleged at complaint Id. 966. The association land- and its members had coerced certain Likewise, in v. Link Mercedes-Benz of hire non- other contractors to owners and (3d America, Inc., F.2d Cir. North Id. union labor. 1986), repair customers claimed Mercedes dealers, required that Mercedes who were to determining plaintiff-un- whether exclusively purchase parts from Mercedes at standing 4 of sue under section ions had to passed artificially prices, inflated had Act, Clayton employed AGC Court at 928- those to retail customers. Id. framework, costs analytical which encom- five-part Brick, Citing we that retail (1) Illinois held following passed considerations: customers were indirect viola- causal between the antitrust connection standing. lacked antitrust Id. at therefore (including plaintiff harm tion and the intended cause that whether the defendant (2) harm), 537,103 908; at at wheth- id. S.Ct. recently, in III Associ Most Gulfstream inju- alleged er the “nature” of the ates, Aerospace Corp., 995 Inc. v. Gulfstream ry type laws were is “of the that the antitrust (3d Cir.1993), we held that F.2d 425 forestall,” at intended id. at 103 S.Ct. aircraft, purchaser of and not a direct (3) 909; the directness or indirectness buyer assignee, downstream or had 910; at injury, id. at asserted S.Ct. pursue an antitrust claim. Id. at 439. We (4) the existence of more direct victims of “any exception emphasized that (i.e. plaintiff alleged injury whether purchaser inappropriate rule would be likely party most to seek redress Supreme for the same reasons case violation), at at antitrust id. inappropri exception held an would be Court (5) 910-11; duplicative the potential UtiliCorp.’’ ate in Id. recovery complex apportionment of dam- 543^14,103

ages, id. at 911-12. at S.Ct. attempt was an AGC five-factor framework B. synthesize clarify by the Court argue Supreme Court anti- confusing collection of the then-extant “direct has receded Illinois Brick’s trust-standing rules.13 con- purchaser” Specifically, plaintiffs rule. however, intimation, Contrary plaintiffs’ purchaser” requirement tend that the “direct Illinois Court neither overruled AGC displaced by ap- the multi-factor has been Indeed, the application. limited its Brick nor proach to antitrust outlined Asso- approv- Court cited Brick AGC Illinois ciated General Contractors California 544-45, al. 103 S.Ct. at 911-12. Carpenters, See id. 459 U.S. State Council of (1983) four and five in the AGC factors [herein- L.Ed.2d concerns. echo Illinois Brick’s ’’]. after framework “AGC Cir.1980), AGC, (5th applied Corp., appeals Exxon 632 F.2d 546-47 13. Prior to the courts 427, denied, 927, 454 U.S. 102 S.Ct. rt. standing variety ce different to determine of tests (1981); Corp. 70 L.Ed.2d 236 Calderone Enters. (1) Clayton 4 of the Act: "di- under section Circuit, Inc., 454 F.2d v. United Artists Theatre test, Chrysler Corp. injury” v. rect see Fedders 1292, denied, (2d Cir.1971), cert. 406 U.S. 1295 (6th 1229, Cir.), Corp., F.2d cert. de 643 1233 930, 1776, 32 L.Ed.2d 132 92 S.Ct. nied, U.S. 102 S.Ct. 70 L.Ed.2d 454 Recognizing that these alternative formulations (1981); Kodak, v. F. Loeb Eastman 183 assessing led to con for antitrust often 1910); (3d (2) the "zone of interests” Cir. results, tradictory Supreme inconsistent test, Corp., Oil v. Sinclair 521 F.2d see Malamud attempted a unified Court in AGC set of to articulate 1975); (3) (6th applied generally 1151-1152 Cir. that could be factors test, standing. "target Corp. determining antitrust area” see Pan-Islamic Trade view, incorporates, standing pursu- rather than mand a determination of In AGC for our disagree. ant factors. principles of Illinois Brick.14 to the AGC We repudiates, the fully distinguishable. Loiver Lake Eñe is assert, however, that the abso- Plaintiffs Eñe, plain- In Lower Lake we found that the purchaser” the “direct rule has lute bar of particular tiffs’ claims did not involve “the by balancing ap- supplanted AGC’s been recovery sought kind of double Illinois Brick contention, plain- proach. support In of this prevent.” Id. at 1169. passages opinion certain from our tiffs cite to Erie Iron Antitrust in In re Lower Lake Ore contrast, By policy all of the concerns (3d Cir.1993), Litigation, F.2d 1144 cert. expressed implicated Illinois Bñck are — dismissed, U.S.-,-, First, present case. there is considera 589, 610, and cert. de- 126 L.Ed.2d Hospital ble risk that defendants and —nied, -, U.S. Copy exposed Service defendants would be (1994), wherein we adumbrated L.Ed.2d multiple liability. Although plaintiffs’ at purchaser “indirect status is neces [not torneys here have chosen not to sue the sarily] [an antitrust] the death knell of directly, probable defendants law Lake Id. at 1168. Lower claim....”. yers purchase photocopies who themselves of Erie, compa- companies, dock several steel bring them clients’ records would trucking companies filed civil ac- nies and treble-damage against Hospital claims court, alleging that tions in federal district Copy defendants and the defendants Service companies serving the the defendant railroad Indeed, in the future. both the district court region Lake Erie industrial had con- lower inquired why and this court as to the instant monopolize transportation spired complaint had not been amended to substi handling region. iron ore in the Id. at of plaintiffs. tute the No satisfac 1151,1152. Hence, tory given. answer was if we were to trial, liability jury In a bifurcated deny protection the defendants the against Lake Erie Rail- rule, found Bessemer and purchaser” potential “direct could (BL E), remaining Company & the sole road ly be held liable to both clients and the defendant,15 in favor of all but attorneys representing the clients. one; damages jury awarded all but and the Furthermore, appor- this lawsuit involves damages. at 1151. On one claim for Id. problems perhaps complex more tionment appeal, applied we AGC and affirmed implicated in Bñck. Be- than those Illinois BL district court’s denial of & E’s motion photocopies cause the costs dismiss for lack of and the district client, if the costs are passed on to the judg- BL motion for court’s denial of & E’s basis, all, contingent passed on at on a

ment n.o.v. Id. complex district court would be faced percentage as to the here contend that Lower Lake statistical calculations attorneys as photocopying costs borne requires Eñe that we set aside the district summary compared borne their clients. grant judgment and re- to the costs court’s course, injury two to an antitrust violation falls “within 14. Of AGC and Illinois Brick address aspects standing. analytically attorneys general' distinct of antitrust group 'private that Con- Merican, (noting F.2d at 963-65 See gress laws under to enforce the antitrust created recognized types Supreme two "the Court has Id. at 963. Illinois Brick focuses section 4.” availability limitations on the of the section recovery duplicative exclusively on the risk remedy the courts must consider when which overly-complex damages potential and the examining damage whether a action treble apportionment calculations. Id. at 963-64. maintained”). The Court was concerned AGC always duplica- there would be a risk of Because primarily particular with the issue of whether potential complex recovery, tive as well as the plaintiff’s injury anti was too remote from an purchas- computations, apportionment if indirect providing plaintiff injury trust to warrant claims, bring antitrust ers allowed inquiry, remedy. akin Id. at 964. This section to negligence rule, purchaser” the AGC stan- "direct unlike "proximate cause” in the determination dard, bright-line is a rule. context, and resists the use is subtle id. of hard-and-fast “black letter” rules. See contrast, all settled before trial. the 15. The other defendants In Illinois Brick dealt with issue plaintiff a who is able to trace an of whether addition, leged conspiracy by have toilet seat manufacturers In the district court would to contingent price to degree the which fees to fix the of wood-flour toilet seats. ascertain plaintiffs includes a charged Litig., to successful See In re Toilet Seat Antitrust (J.P.M.L.1975). photocopying costs not recoupment of F.Supp. One plaintiffs. charged losing to Harvey plaintiffs, Company, Lumber the through purchasing a purchased toilet seats circumstances, plaintiffs can- these Under agent, Purchasing Company, Biddle which bar of the “direct escape not the absolute actually placed the seats the order for toilet In to survive sum- purchaser” rule. order price by Harvey. approved at a Biddle re- mary judgment, plaintiffs must establish that monthly fee, flat ceived a unrelated clients, attorneys, the not are the and their ordered, kept in- quantity of toilets no hospital-record pho- purchasers direct Litiga- ventory. In re Toilet Seat Antitrust record, proof no such ex- tocopies. On ¶ tion, 72,496. 61,601, 1977-2 Trade Cases at ists. that these district court concluded under circumstances, Harvey was a direct limited C. purchaser of the toilet seats and had stand- argue they, Plaintiffs and not ing bring at an antitrust claim.17 Id. purchasers lawyers, then- are the direct of 72,496-97. hospital photocopies.16 the record attorneys merely acted contend their as case, contrast, present the none purchasing photocopies. the agents their lawyers plaintiffs their act as retained Citing Litigation, In re Antitrust Toilet Seat objective purchasing agents mere whose sole ¶ 61,601, Trade 1977-2 Cases 1977 WL 1453 buy photocopies and function was to (E.D.Mich.1977), posit pur Rather, her clients. each client hired his or by agent made on behalf of the

chases attorney file or a lawsuit his her behalf agent’s principal do not come within the legal protect interests. client’s purchaser” scope of the “direct rule. Moreover, reading re- fair record lawyers purchased photo- veals that the by plaintiffs’ argu- unpersuaded areWe representing for their own use their In re ment and find Toilet Seat Antitrust clients, attorneys, clients. The not single upon by Litigation, the case relied theory, undeniably agency support their inapposite. photocopies. That case involved an al- be cal, attorneys 16. Plaintiffs. first contend that their the homeowner would still be considered housepainter part purchaser had be of the chain of indirect even if the cannot considered distri- from, charged recoup they profit a fee the costs of do make a insufficient to bution because not charged for, paint job housepainter or charge if had separately photocopies. or We no all. fee at persuaded for least are not First, at two reasons. in order for consumer be considered item, The district court relied on dictum purchaser of an not neces- an indirect Brick, "An- footnote 16 Illinois which stated: separate charge sary consumer incur other in which market forces have been item; situation only necessary for that it is that the con- superseded might pass-on defense purchased through the item a mid- sumer permitted purchaser is where the direct is owned example, a For homeowner who hires a dleman. Brick, by its customer.” controlled Illinois charges housepainter who the hour and does 431 U.S. at 736 n. 97 S.Ct. at 2070 n. 16 separately invoice the homeowner for the Co., (citing Perkins Oil 395 U.S. Standard of materials cannot be considered "di- cost 1871, 1874-75, 23 89 S.Ct. L.Ed.2d 599 paint purchaser" used the house- rect Cases, (1969) Asphalt Liquid and In re Western painter. 191, 197, (9th Cir.1973), de 487 F.2d nied, cert. Second, indirectly, attorneys profit, do albeit 415 U.S. 39 L.Ed.2d purchase (1974)). their of their clients' rec- Harvey "controlled” Bid Because is, they contingent photocopies. regarding purchases That earn a ord dle's actions made on Har behalf, "view[edj vey’s fee at the end of successful action. the district court the rela (or profit falling tionship Harvey failed to even even if if Biddle between transaction, loss) exception.” suffered a on the this fact In re Toilet Seat within above ¶61,- pur- Litigation, does not transform clients into direct Antitrust 1977-2 Trade Cases 72,497. example, previous hypotheti- For chasers. relationship Furthermore, pal-agent exists between clients that the costs of the the fact attorneys attorneys, but whether the client on a and their passed on to photocopies were (at employ- or mere independent least where the are contractors dollar basis dollar for Although recovery on behalf of the there are a number of factors attorney ees. obtained (2d) Indeed, client) sub- dispositive.18 inquiry, to this see Restatement is not relevant utility (1958), important § Agency in Illinois Brick and the the most contractors by costs UtiliCorp passed degree in on their of control exercised companies factor is cases; yet respective principal: in those this fact insuffi- Supreme Court deemed legal employee distinction an between indirect-pur- to confer to the cient independent is so and an contractor well cases. those chaser little, any, if require as to dis- established attempt distinguish pre- these The characteristics of the former cussion. characterizing only the middlemen relationship is that the master not cedents “independent contractors.” cases as the result of the work but has the those controls attorneys position way that the it shall be right Plaintiffs take the to direct the which contrast, ease, agents done, are the lat- present whereas the characteristic of independent engaged in the person contractors. ter is that the work and not manner of has the exclusive control of the course, is, beyond that the cavil It it, performing being responsible for relationship agent-prin an attorney-client the result. However, attorneys relationship. are cipal Co., 363 Pa. Feller v. New Amsterdam Cas. independent contractors as well as also (1950). (2d) also Moon § 70 A.2d See Agency 14N agents. See Restatement Garzony, 522 Pa. (1958) (“One Area Sch. Dist. act on behalf of who contracts to (1989); Paper Hammermill A.2d subject other’s control another Co., Eng’g A.2d v. Bust 430 Pa. Co. respect physical conduct is except with to his 389, 392 independent contrac agent and also an (“[MJost tor.”); of the § comment a id. 14N attorneys “ex It is clear that exercise is, brokers, agents, that persons known as performing control of the manner clusive factors, agencies, and attorneys, collection work], legal being responsible [to the [their independent selling agencies are contractors Feller, only for the result.” 70 A.2d client] _”) added); In 41 Am.Jur.2d (emphasis at 300. (1995) (“[F]or § 4 ex dependent Contractors Furthermore, plaintiffs here are not even ... attorneys at law and other similar ample, photocopies. directly hable for the cost of agents, although as to their persons ... are Except McCarthy, plaintiffs are liable for independent con activities physical attorneys achieving a only if their succeed in ....”) added); (emphasis see also tractors Indeed, three of recovery on their behalf. Mining Corp., v. Minds Coal Commonwealth impose agreements do not contingent-fee (1948) (adopting Pa. 60 A.2d costs; rather, charge litigation separate independent con Restatement definitions out of are reimbursed tractor). or award. percentage share of the settlement independent agent An be either ease, (or McCarthy’s although retainer employee in mod- or a servant contractor (2d) responsi- that she is agreement does indicate day parlance). Restatement ern See outcome, (“An (1958) her irrespective of the agent ble for costs § 2 comment b Agency prac- therefore, attorney acknowledged that in actual is, an inde- is not a servant who tice, charged clients unless firm never to act his law when he contracts pendent contractor Furthermore, Therefore, recovery. firm obtained a principal.”). on account McCarthy insurmountable ob- princi- faces another inquiry here is whether relevant carry passenger to his destination. taxicab to are no more direct 18. Plaintiffs gasoline charge separate even if a photocopies here than a at issue record assessed, passenger still could not the taxi passenger a taxicab would be considered any purchaser in sense. a direct gasoline be considered purchaser of the used not photo- spirators immediately upstream were attorney paid never the stacle: her joined the also as codefendants: copying charges but rather obtained opposing counsel. needed this Alternatively, appellants argue that (and indeed, Therefore, McCarthy even her exception a carve out narrow court should attorney) any injury less show cannot conspiracies in to Illinois Brick vertical —much injury. antitrust intervening parties the dis- the in where process eo-eon- are named as tribution facts, undisputed we must Based on these (a “co-conspirator ex- spirators so-called pur- clients are not direct conclude that the recognize this ception”). decline to We exception an to the unless chasers.19 And here, where, exception alleged co- as the here, principle applies the purchaser” “direct joined conspirators also co-de- are not as standing plaintiffs no to assert have fendants. count I. antitrust claim under omitted) (citations Link, at 931 F.2d added). (emphasis D. Name, Similarly, although in Brand the alternative, in the argue, that plaintiff district court allow the retailers did apply not here because Illinois Brick does pharmaceutical drugs to sue the man- both excep they “co-conspirator” fall within the wholesalers, on ufacturers and the it did so Citing to purchaser tion to the rule. plaintiffs alleged that that the basis the had Link, 788 F.2d at and In re Brand (i.e. upstream parties immediately the the Drugs Litiga Prescription Name Antitrust wholesalers) manufac- had colluded (N.D.Ill.1994), tion, plain F.Supp. plaintiffs fix not prices. The had turers proposition that indirect tiffs advance alleged overcharges passed that on but bring an antitrust buyers have wholesalers, part rather that as co-conspir against who are claim defendants imposed price-fixing conspiracy, directly had conspiracy. To in a antitrust ators vertical overcharge plaintiff an on the retailers. See recognize a co- the extent that these cases Name, F.Supp. Brand however, conspirator exception, we hold significantly, the court in Most district applica plaintiffs have failed establish emphasized Name Brand the reason exception facts at bility of an such granted summary judgment in favor had not hand. of the manufacturer-defendants was because reading reject plaintiffs’ plaintiffs “the named Preliminarily, [as defendants] we ha[d] large possible establishing exception percentage an to Illi- of all [wholesalers of Link as middlemen, allegedly participated conspir- Brick from whom who had in the nois where acy].” Id. at de- plaintiffs purchases, participated district court made “penalize[] plaintiffs] conspiracy. To the con- clined to for the [the a vertical antitrust Link, adopt join every single trary, expressly [in- failure to [wholesaler we refused ” alleged alleged conspiracy].... co-eon- in the Id. exception such an where the volved ordering goods attorneys parties attorney the real interest. that an or services 19. The are Indeed, here, previously, district court noted litigation, as as is connection with the case attorneys plaintiffs’ opportunity to offered the ordinarily principal hence treated as as the of record. substitute themselves expenses. would be liable for such Although object did the defendants not Pennsylvania, Even the whose lower courts proposal, the district court's us, binding have had diffi- decisions offer, choosing in- the court's declined Eyre, culty with See v. this issue. Pessano ruling appeal district adverse stead to court’s (1900). Pa.Super. 157 But the cases neither standing. toas parties' re- those revealed research nor attorney generally acknowledge We this vealed our research have discussed own client, agent as to be considered such, action, of a federal antitrust issue context personally liable for would not be held as we here. In none of those cases such have expenditures principal. See for a disclosed made purchaser rule at was the Illinois Brick direct Walkinshaw, Messenger Publishing Co. anti- We are that in the instant issue. satisfied However, Pa.Super. A. 18 context, attorney-appellants have do not trust Pennsylvania yet Supreme Court to address has prosecute authority subject this action. there is a wealth of ception. Specifically, plaintiffs have failed to they have posit that Plaintiffs here pre-existing agree- alleged show the existence of co-conspirators in the joined all of photo- (i.e. purchase quantity a fixed and ment to Hospital defendants conspiracy defendants). Reasoning attorneys. copies from the See Mid-West Copy Service addition, require thereby Paper, F.2d at 580. satisfied earlier, exception, plain plaintiffs to co-conspirator discussed have failed ments they be they pay should therefore that must the full cost argue tiffs that demonstrate bring antitrust claim standing liability litigation to their accorded since they purchasers. though contingent are not direct even costs is nature. agree. cannot

We sum, plaintiffs In have failed to establish Name and misconstrue Brand Plaintiffs exception purchaser any that to the direct Link, of the co- the nature and misconceive Thus, hold that rule obtains. we fall within exception. In order to conspirator standing pursue their antitrust claim lack have to exception, plaintiffs here would I). (count immediately the intermediaries allege that is, attorneys, colluded that upstream, IV. overcharge plaintiffs the defendants Moreover, plaintiffs photocopies. for the standing Significantly, antitrust join lawyers as de- obliged to

would be apply equally allegations principles sum, fendants, they have not done. which violations. Holmes v. Sec. Inves RICO See apply co-conspirator exception does not 258, 270, Corp., 503 112 tor Protection U.S. here. (1992). 1311, 1318-19, 532 117 L.Ed.2d S.Ct. taught by Brick and precepts The Illinois E. claims, thereby UtiliCorp apply to RICO de present suggest also victims. nying to indirect RICO cost-plus “pre-existing within the case falls (7th 768, Loshbough, 770 v. 951 F.2d Wooten purchaser exception to contract” Cir.1991); City De County Oakland v. exception from dictum This arises rule. (6th 839, Cir.1989), troit, 851 cert. 866 F.2d Hanover Shoe: 1003, 3235, denied, 111 110 S.Ct. 497 U.S. might situa- recognize that there We (1990); Berger, 111 v. L.Ed.2d 747 Carter instance, overcharged when tions —for (7th 1173, 1176 Cir.1985); Terre Du Lac F.2d “cost-plus” con- buyer pre-existing has a Inc., 467, Lac, Du 772 F.2d Ass’n v. Terre tract, making easy prove that he thus denied, (8th Cir.1985), 475 U.S. 473 cert. damaged the consid- has not been —where (1986); 1460, 1082, L.Ed.2d 718 89 106 S.Ct. de- requiring passing-on that the erations Serv., Inc. v. Kiewit Daley’s Dump Truck case would permitted this fense not be (W.D.Wash. Co., 1498, F.Supp. 1504 759 Pac. present. not be nom., 1991), Imagineering, Inc. sub. aff'd Shoe, 494, (9th at Cir.1992), at 88 S.Ct. Co., Hanover 392 U.S. 976 F.2d 1303 Kiewit Pac. 1004, 1644, denied, 507 U.S. cert. (1993). Indeed, plaintiffs L.Ed.2d 266 cost-plus “pre-existing vitality of the The that, they antitrust if lacked conceded however, doubtful, exception is contract” standing. they also lacked RICO standing, Court, in UtiliCorp. Supreme light of Certification Plaintiffs’ Motion Secure See case, recognize an expressly refused to 1168-69). (Nov. 1994), (App. at at 3-4 where one exception to Illinois Brick even increases had percent of the cost hundred Hence, dispositive issue is the central through purchasers. passed to indirect been purchasers.” plaintiffs are “direct whether 216, 110 at 2816- S.Ct. Utilicorp, 497 U.S. so, pursue both they are entitled If not, If and inso- claims. and RICO antitrust concerned, the district damages are far as exception if sur even summary judgment granted properly to show court UtiliCorp, plaintiffs have failed vived defendants. in favor of the prerequisites of this ex- they meet the Paper, F.2d at 590. See also V. Mid-West Merican, 6; at 962 n. In re F.2d Beef argue Finally, that even if Litig., 600 Indus. Antitrust F.2d damages lack to recover under sec- (5th Cir.1979), denied, cert. U.S. Act,20 Clayton they may 4 of still tion We cau L.Ed.2d injunctive section 16 seek relief under tioned Act.21 standing urged by the rule of the defen- dants, completely which would bar indirect analysis Standing under section is not relief, injunctive seeking Cargill, for section 4. See identical to that gap would leave serious the antitrust Inc., Colorado, Inc. v. 479 U.S. Monfort scheme, these enforcement fate of 104, 111 490 n. n. injured parties, competitive and of the 16 has been L.Ed.2d 427 “Section economy industry, in an be entire would applied expansively, both because its more dependent upon willingness the of made § language less restrictive than of is government purchasers and the the direct injunctive remedy ... and the is because lengthy the of a law- assume burdens adaptable enforcing tool for more flexible and suit. damage the laws than the reme antitrust dy_” Schoenkopf v. & Brown William Paper, Mid-West 596 F.2d 593-94. (3d Corp., 637 F.2d son Tobacco Although plaintiffs satisfy need Illinois Cir.1980). importantly, Most “because Brick’s, in purchaser” requirement “direct § 16 no threat mul- under raises of relief, injunctive to seek must still order tiple duplicative [i.e. lawsuits or recoveries showing threshold make a entitlement ], in Illinois Brick the concerns voiced some injunctive is, plaintiffs relief. That must injury than of the other antitrust factors (1) injury cogniza- threatened loss or show: to a appropriate are determination stand- (2) equity; resulting ble proximately § ing § under 4 are not relevant under 16.” alleged City the Roh antitrust violation. Cargill, at 111 n. 107 S.Ct. at 490 479 U.S. (9th Harris, 1040, 1044 nert F.2d Park n. 6. Cir.1979), denied, 961, 100 cert. 445 U.S. (1980); L.Ed.2d Central Paper, expressly we In Mid-West Rainbolt, Nat’l Bank v. 720 F.2d rejected pur the contention that the direct (10th Cir.1983). Because the court district injunctive chaser rule bars relief under sec plaintiffs never considered whether would damages tion as well as treble suit injunctive entitled to relief under section explained that under section 4. We separate apart and from the Illinois Brick rule, we remand to allow the will damage action, the contrast to treble analysis. district court to such an undertake injunctive not present claim for relief does countervailing as the considerations —such duplicative risk or ruinous recover- the VI. spectre of a trial burdened with

ies conjectural complex analy- economic reasons, foregoing will affirm For we Supreme emphasized ses—that Court summary judg- grant the district court’s availability limiting when of treble plaintiffs’ in favor of ment the defendants on (count I) damages. treble-damages claim and RICO 15(a). Clayton § 20. Section 4 of the Act allows for recov- U.S.C. ery damages private in a ac- treble antitrust tion: provides part: in relevant Section 16 person injured [A]ny who shall be his busi- Any person ... be entitled to sue for shall property by anything ness or den in reason of forbid- against injunctive relief ... threatened ... the antitrust laws sue therefor damage damages by a violation of the antitrust shall recover threefold loss suit, sustained, including him and the cost of laws. attorney's reasonable fee. (count purchasers photocopies. II),22 as to the direct of the I but we will reverse claim injunctive agree. re plaintiffs’ relief and claim proceedings consistent with

mand for further purchas- plaintiffs are direct Whether opinion.23 this however, depends copies, ers of the on agents whether are STAPLETON, Judge, concurring Circuit purchase of plaintiffs respect part: part dissenting attorneys bought copies If the copies. acknowledges, “beyond it As court agents plaintiffs, for the then the attorney-client relationship is cavil that the If, copies. purchasers are the direct relationship.” (Majority agent-principal hand, attorneys purchased on the other 853.) Nevertheless, the Op. at court declares behalves, copies their own then the case], “attorneys and not [in cop- indirect clients, undeniably purchas- the direct were applied applicable ies. When the law is (Majority Op. at photocopies.” ers of the summary judgment the facts reflected in the 852.) proposi- first of these inconsistent record, inescapable that the conclusion is correct; clearly necessarily follows tions is attorneys purchased copies for photo- not. Because the that the second is clients and the clients are the purchased from defendant purchasers. attorneys, as for copy by agents the services client-principals, the their it is disclosed A. clients, attorneys, purchased not the who and reason, I this would reverse the them. For Pennsylvania, agency of In the elements judgment the district court and remand of by principal are “the manifestation the that plain- on all of proceedings for further the him, agent agent’s accep- the the shall act for tiffs’ claims. undertaking tance of the and the understand- ing parties principal of the that the is to be in

I. Purcell, undertaking.” control of the v. Scott (1) (1980) 109, 56, III-B, part (quoting 490 Pa. A2d 60 In the court concludes that: 415 (Second) 1, Agency § Com- the Restatement Supreme Court Associated General of (1958)). lawyer a California, Inc. v. ment b When undertakes Contractors of California 519, client, represent to Carpenters, 459 he consents the State U.S. Council .a of (1983) having representation client’s of the 74 L.Ed.2d 723 control [herein- though ], expected to exercise after neither overruled Illinois Brick even he AGC Illinois, respect professional judgment with the v. 431 U.S. Co. objectives the (1977), pursuing rep- of of applica- nor limited means L.Ed.2d 707 its tion; (2) Pennsylvania Rules of incorporates, re- resentation. Profes- rather than “AGC Brick,” 1.2(a). reason, For this pudiates, principles of sional Conduct Illinois (3) 850); attorney-client relationship, as the court ac- Op. AGC Illinois (Majority and regarded as aspects knowledges, generally an Brick two distinct of anti- is address (4) escape agency relationship. principal, a standing; in order As trust and attorney plaintiffs by client is bound the actions summary judgment, must es- As representation. in the course an they and not their are of tablish that claims, little, any, and is if likelihood that § there 15 U.S.C. 26. plaintiffs request will of additional those claim, III, rights the civil was dis- Count records from it is the defendants. appeal and is missed the district court not on highly doubtful that additional records injury pertaining personal before us. plaintiffs’ claims Nevertheless, generated. because will be our injunction precedents require that a claim for an only Although injunctive relief was issue discussed, differently seriously treated than a perfunctorily under section 16 be and we briefed damages successfully for under section it is question can be claim treble whether the issue court, note, instance, appropriate rather than pursued. that the district We Court, claim the merits of the apparently all of the consider obtained medical rec- injunctive instance. personal injury relief in the first particular ords relevant to party a agent principal is not attorney, agents, like other is a for a disclosed agent, the agent that the on behalf client-principal his to contract enters fiduciary and owes (Second) care, obedience, loyalty. principal. and Re- Restatement duty of of (followed Press, (Second) 377-398; § Inc. Agency Agency §§ Revere statement 407, 409 Blumberg, Pa. 246 A.2d Pennsylvania Rules of Con- e.g., Professional (1968)). Thus, 1.2, it such 1.1, 1.3, particular, agreed In an unless is 1.15. duct contract, party tangible agent to be a attorney property who obtains is, effect, a agency to his contract contract between carrying out the owes course of party. duty principal to exercise and the third Restatement client-principal a reasonable (Second) (followed § Agency in Hill protection, to use in accor- care in its it Co., Apartments, Nyce brook Inc. v. Crete principal dance with the directions (1975)). benefit, upon Pa.Super. to surrender A.2d for his where, here, pur attorney agency. Accordingly, on the termination demand 422; (Second) it is under Agency photocopies § of records and chases Restatement being pur Pennsylvania of Professional stood the seller Rules Conduct client, 1.15,1.16(d). attorney may have a chased behalf of his the client While attorney purchaser. My re compensation, it is is the any unpaid to secure lien Pennsylvania me any tangible property view of case convinces only a lien ob- law Pennsylvania basic repre- course of to these tained or created in the subscribes agency in client-principal. principles of the context of belongs to the sentation relationship. attorney-client Pennsylvania Rules of Professional Conduct 1.16(d). Porter, Serg. & R. 100 Moore v. (Pa.1825), Pennsylva- typical attorney- Supreme

The record here reflects Court nia available to relationships between addressed remedies client attorneys prothonotary by liti- attorneys. agreed to to collect fees incurred their The personal inju- gants. party for the in their The court held that represent “[t]he done, responsible are is ry on their behalf the whom the services suits thus to obtain fees, necessary [prothonotary] him is prosecute for the and to the goods and services chargeable are Although attorneys, per- to look.... The fees not suits.1 the those attorney party the the the ser- by Pennsylvania’s Rules of Profes- of for whom mitted done, advancing security Conduct,2 their vices unless he become are are has sional at 101. expenses litigating associated with the costs.” Id. clients the not, cases, my view, alter their this does (1900), Eyre, Pa.Super. 13 Pessano v. 157 attorneys relationship the the between by expert against a suit an witness involved the third their clients or between clients and attorney pursuit the that hired him in of his attorneys the parties whom the deal on with superior claim. The court held that client’s contrast, By nothing in the behalf. clients’ express ... no under- “[i]f there was direct suggests pur- the are record taking part [attorney] pay on the chasing on their own behalves the records witness], [expert what was due to the that is on hope making profit of a resales to matter,” expert the end of the because the clients. attorney. not witness could collect from the attorney agent controlling is Id. at The be liable to attorneys’ role as would attorney because, expert if the agreed, otherwise an witness here unless course, (e) attorney lawyer provide A shall not financial assis- understood an 1. Of it is practice, pending goods generally in his such tance to a client connection with obtains used supplies, litigation, on his own behalf. Office contemplated except as office that: purchased by analogous paint supplies (1) lawyer may are costs and a advance court purchased by housepainter gasoline a a or the litigation, expenses repayment of which of (See hypotheticals. taxicab driver in the court's Majority Op. contingent the mat- on outcome of 15, 17.) 853 n. at 852 n. ter; and (2) indigent lawyer representing client an litigation may pay expenses of court costs Pennsylvania's of Professional Conduct Rules 1.8(e) the client. provides: behalf of

859 Christensen, jurisdictions agree. merous See by special promise.” liable himself “ma[de] O’Connor, & Havelka v. State Garrison Id.3 of Revenue, Washington, Department 97 Publishing v. Walkin Messenger Co. 764, 839, (1982); 649 P.2d 843 Has Wash.2d (1931), 445, shaw, A. Pa.Super. 157 18 102 Krsul, 270, P.2d brouck v. 168 Mont. 541 an attor superior court held that where (1975); 529, May, In re 27 N.Y.2d 1198 paper used on ney copies of “a book orders 999, 1000, 261 N.E.2d 110 312 N.Y.S.2d the at publishing company, appeal” from a Millheiser, (1970); 569 Kates v. So.2d agent for capacity as an torney does so his (Fla.Dist.Ct.App.1990); v. 1357 Free Wilmar explained: court client. As the his Co., Or.App. P.2d J. Helric attorney acting for the has been When an (1984); Corp. Engineering Weeden 119-20 client up judgment and the defendant Hale, (La.Ct.App.1983); So.2d appeal an taking in the acts with him 319, 124 Barry, Ill.App.2d Petrando v. attorney printing of the orders the and the (1955); Attorney N.E.2d 7A C.J.S. rules of the required paper-books (1980) (“In § of as- Client absence court, presumed that it is to be appellate liability, attorney sumption personal is authority from his acting under he is generally liable for work done third least, ordering paper- At client. persons representation in connection with his attorney’s scope is books within client.”). of a authority. law, plaintiff-clients, Under this case Id., Huntzinger v. (quoting A. at 19 attorneys, responsible and not their (1922)). Thus, Devlin, Pa.Super. Ct. purchase price photocopies. held, could company, the court publishing reflects that the record attorney. not collect from past5 continue to pay had to and will Walkinshaiv, Pessano, Moore, prices Based on that the pay in the future6 the have to Pennsyl- Huntzinger, I conclude that Assuming charge. copy services choose vania, attorney contracts with “when affected the that an antitrust violation has a client for party charge, for the benefit of I fail to prices copy third that the services in connection a more goods or services to be used how there could be understand par- attorney’s representation relationship between that violation and causal injuries. party alleged is aware of plaintiffs’ and the third ticular client facts, attorney not liable on the these B. impli- expressly or unless he either contract liability.” the at- special concludes that because edly type of court assumes some Kasmir, Turner, with re- torneys independent contractors v. are Inc. Eppler, Guerin & copies, the attor- purchase of the spect Nu- (Tex.Ct.App.1985).4 685 S.W.2d Pennsylvania law case Byre, 4. The court intimates v. concludes that in Pessano 3.The court Pennsylvania may inapposite case (1900), because no superior "had Pa.Super. court agency federal antitrust issue in a discusses (Majority Op. difficulty at 854 with this issue.” purchaser and none address the context 18.) difficulty the sure of which n. I am not 18.) (See my Majority Op. n. at 854 rule. superior contrary, speaks. court On view, significant because is not this distinction principle plainly Pessano articulates court in attorneys purely a agency is status agent generally on a is not liable that while an suggest question of state law. The court does principal, on behalf of a disclosed contract made question may why agency turn out a reason known, agent agency ... is "even where the context, and I differently federal antitrust express under- himself liable render perceive none. Gallagher, taking.” Pennsylvania R. Co. Pa.Super. In the 101 A.2d 6, plain- acknowledges in footnote court 5. As the case, evidence of an in this there is no record their have covered and Hoffman tiffs Tomasetti attorneys. undertaking liability by the express of attorneys' advances. attorney may commit that the the fact responsible testimony to the seller for that F & S to be credits the himself 6. Even if one right press is to reim- price that the client its contract purchase does not mean chooses not to cases, any property pur- it is clear responsible in unsuccessful or that bursement not also purchase up paying the will wind does not the clients behalf of the client chased in the sale on cases. photocopies in all successful price belong to the client. neys, plaintiffs, are the direct rather than copies. The issue of independent attorneys are con-

whether here, simply is not relevant however.

tractors status relevant

Independent contractor is person’s the extent of a to determine liability parties. According

tort third respondeat superior, B acts

the law of where commits

for the benefit of A and a tort and contractor, C,

injures independent if B is an A regardless cannot

then C recover If, agent. B is on

whether A’s the other A,

hand, B a then C can recover servant regardless agent. whether B is

from A A’s

Thus, if the plaintiffs’ true that even it be contractors, independent all us are not

this tells is that

responsible parties to third torts commit- attorneys. nothing It tells

ted us attorneys, agents,

about whether the

purchased on their behalves. See (Second) Agency §§ 219-

Restatement

II. apply principles

Because antitrust violations, I

equally allegations of RICO reasons, conclude, foregoing

would plaintiffs may go

that the forward on their I damage agree Because

RICO claims.

the court injunctive un-

prosecute them claim for relief Act, Clayton I would

der Section proceedings all of

remand for further

plaintiffs’ claims. of America

UNITED STATES MacLEOD, Appellant.

John 94-5561.

No. Appeals,

United States Court

Third Circuit.

Argued Sept. April

Decided

Case Details

Case Name: McCarthy v. Recordex Service, Inc.

Court Name: Court of Appeals for the Third Circuit

Date Published: Apr 4, 1996

Citation: 80 F.3d 842

Docket Number: 95-1005

Court Abbreviation: 3rd Cir.