Beacon Theatres, Inc. v. Westover

PETITIONER: Beacon Theatres, Inc.
RESPONDENT: The Hon. Harry C. Westover, Judge of the United States District Court of the Southern District of California, Central Division, et al.
LOCATION: U.S. District Court Southern District of California

DOCKET NO.: 45
DECIDED BY: Warren Court (1958-1962)
LOWER COURT: United States Court of Appeals for the Ninth Circuit

CITATION: 359 US 500 (1959)
ARGUED: Dec 10, 1958
DECIDED: May 25, 1959
GRANTED: May 19, 1958

ADVOCATES:
Frank R. Johnston - for the respondents
Jack Corinblit - for the petitioner

Facts of the case

Fox West Coast Theatres (Fox West Coast) in San Bernardino, CA, held various contracts for "first-run" rights of movies. Beacon Theatre, Inc. (Beacon) opened a drive-in theater within the competitive area and threatened to sue Fox West Coast over their "first-run" contracts claiming they violate antitrust laws, in particular the Sherman Antitrust Act and the Clayton Act. Beacon then threatened legal action against Fox West Coast. Fox West Coast proceeded to file an injunction to prevent Beacon from pursuing legal action because their actions were causing "duress and coercion." Beacon responded to the injunction with a counterclaim against Fox West Coast stating they were not competitors in the same area, so Fox West Coast’s claim to “first-run” rights was unreasonable. Beacon further claimed that Fox West Coast and local film distributors were conspiring together to monopolize “first-run” exclusive rights to films.

Judge Harry C. Westover denied Beacon a trial by jury because the suit involved both matters of law and equitable damages. Beacon appealed this decision on the grounds that the competition existing between Beacon and Fox West Coast was a matter of fact to be decided by a jury affirming Beacon’s Seventh Amendment right to trial by jury. The Ninth Circuit Court of Appeals affirmed the lower court’s decision.

Question

Does a case involving both equitable claims and legal claims have a right to trial by jury under the Seventh Amendment?

Media for Beacon Theatres, Inc. v. Westover

Audio Transcription for Oral Argument - December 10, 1958 (Part 2) in Beacon Theatres, Inc. v. Westover

Audio Transcription for Oral Argument - December 10, 1958 (Part 1) in Beacon Theatres, Inc. v. Westover

Earl Warren:

Number 45, Beacon Theatres, Incorporated, Petitioner, versus The Honorable Harry C. Westover, Judge of the United States District Court of the Southern District of California, et al.

Mr. Corinblit, you may proceed.

Jack Corinblit:

Mr. Chief Justice, Associate Justices, may it please this Honored Court.

This case presents the issue as to whether the respondent in this case has improperly denied petitioner a jury trial as to issues related to violations of the antitrust laws.

And whether the rules of law announced by the Court of Appeals to accomplish this result are or are not contrary to the Rules of Civil Procedure promulgated by this Court, adopted by the Congress and are contrary to the Seventh Amendment of the Constitution.

The case briefly arose in the Southern District of California wherein a complaint was filed by Fox West Coast Theatres Corporation.

The complaint was captioned, “Fox West Coast Theatres Corporation versus Beacon Theaters, Inc.”

It was entitled a complaint for declaratory relief.

After the petitioner here, was named defendant there, filed a motion to dismiss on the grounds of lack of jurisdiction and that was denied.

Petitioner filed an answer in which he raised an affirmative -- filed an answer in affirmative defense, filed a counterclaim against the plaintiff and in other party and demanded jury trial as to the complaint, the answer and the counterclaim.

The grounds upon which the petitioner argued that it was entitled to a jury trial as to the complaint -- as to the complaint standing alone were as follows.

The first, that the Seventh Amendment guarantees a jury trial as to actions of law, actions of common law.

This was an action for declaratory relief which is not an action at common law nor is it an action traditionally known as an action in equity.

That the right to trial by jury and an action for declaratory relief turns upon the basic nature of the case and turns upon the -- the kind of the case for which the declaratory action is a substitute.

That in this action, it was apparent from the face of the complaint, from the allegations contained therein that it was a substitute for an antitrust damage suit and that its basic issues were those issues.

And that since under well-established rules, in antitrust damage suits, a -- the plaintiff and defendant are both entitled to a jury trial that therefore plaintiff or defendant -- petitioner here was entitled to a jury trial.

The complaint to make this point was not a very lengthy one.

It alleged, first, that -- it alleged, first, that it was brought under the declaratory relief provisions of the judicial code.

As to page -- at page 10, the complaint appears in our record.

It alleged, first, that it was brought under the Federal Declaratory Judgment Act.

It was entitled, “Complaint for Declaratory Judgment”.

But in the second paragraph of the complaint after the first, as one sentence, there was alleged that there was a controversy in excess of $3000.

And that the matter in controversy arises under the law of the United States to which Sections 1 and 2 of the Act of Congress of July 2nd entitled, “An Act to protect trade and commerce against unlawful restraints and monopolies”, commonly known as the Sherman Act and the Section 4 of the Act of October 15, 1914, the amendatory thereof commonly known as the Clayton Act.

That Section -- Section 4 of the Clayton Act is the statute which gives private persons who are injured, by violations of the antitrust laws, a right to sue.

It is the damage provision of the antitrust laws relating to private individuals.

So that in paragraph 2, there is a rather straightforward statement that the complaint arises under the antitrust laws and under the section of the Clayton Act which gives a private right to damages.

The complaint then alleged that described the parties, the plaintiff, Fox West Coast Theatres Corporation as a company organized in -- operates in the neighborhood of 150 motion picture theatres primarily on the West Coast.

The defendant, Beacon operated the theatre -- opened the theatre, a drive-in theatre just outside of San Bernardino, California where Fox West Coast had for many years, operated a conventional theater as a theater with four walls and a ceiling.

The complaint alleged, then, that there were eight major companies in the United States that produced films.

And these were these -- and the complaint expressly stated that they constituted in the aggregate, this is at page 13 of the record, constant in the aggregate, the major distributors of motion pictures in the United States.