The opinion of the court was delivered by: WOLIN
In this antitrust action defendant Steelite, Inc. renews its motion for partial summary judgment on Counts One and Four of the Complaint based on the recent decision of the United States Supreme Court in Business Electronics Corp. v. Sharp Electronics Corp., 485 U.S. 717, 108 S. Ct. 1515, 99 L. Ed. 2d 808 (1988). For the following reasons defendant's motion is granted.
Defendant Steelite, Inc. ("Steelite") is a Pennsylvania corporation engaged in the manufacture and sale of materials for the construction industry. Specifically, Steelite manufactures roll-formed metal roofing and siding panels which are generally used in the construction of warehouses, manufacturing plants and other commercial or industrial facilities. Steelite also manufactures ventilation equipment for such facilities and resells the fasteners and other equipment needed to install its roofing and siding panels.
Defendant Oxhandler Structural Enterprises, Inc. ("Oxhandler") is a construction contractor engaged primarily in the business of packaging and providing the labor, material and engineering services necessary to erect both the structural components of buildings and the exterior finishes for such structures. Oxhandler has been an authorized dealer-erector of Steelite's building materials since the mid-1970's.
Plaintiff Corrosion Resistant Materials Co. ("CRMC") is a dealer engaged in the business of buying, selling and distributing corrosion resistant building materials. Between 1977 and September 20, 1983 (at which point Steelite terminated its relationship with CRMC), CRMC was an authorized distributor of Steelite's roll-formed metal roofing and siding panels.
B. The Steelite Distribution and Marketing System
Steelite sells its building materials through authorized distributors who fall into two categories: materials-only distributors, like CRMC, and dealer-erectors, like Oxhandler. The materials-only distributors, as their name suggests, provide material (i.e., metal roofing and siding panels and fasteners) to their customers who, in turn, make other arrangements to install (i.e., "erect") the materials. On the other hand, dealer-erectors provide materials, labor, engineering services and/or installation expertise to their customers.
In the maintenance market, Steelite materials are usually sold to the maintenance department of the owner of a commercial or industrial facility or to a contractor who has been awarded a maintenance or repair contract. In the new construction market, however, roofing and siding are usually sold on a competitive bid basis through architects and engineers to contractors.
In both the maintenance and the new construction markets, Steelite's sales representatives and its distributors make every effort to identify pending or planned projects on which Steelite materials can be used and to persuade those responsible for the purchasing decision to choose Steelite products rather than products manufactured by one of Steelite's competitors.
C. Steelite's Pricing and Quotation Systems
Steelite periodically provides its distributors with price lists which set forth the price for standard Steelite products (i.e., standard base metals and gauges, profiles, colors and coatings) and it also directs distributors to consult Steelite's headquarters in Pittsburgh for pricing on engineered sales or for the price of "non-standard, non-stocked" items (i.e., items for which Steelite does not ordinarily stock the raw materials or for which Steelite must schedule a special run at its mill).
As a general rule, when a project will require standard Steelite products only, Steelite distributors can prepare and submit bids to supply these materials without consulting Steelite. If the Steelite distributor is awarded a contract on such a project, said distributor need only place an order with Steelite for the necessary materials. However, those projects which require non-standard materials, engineering services or more than 100 squares of roofing or siding (one "square" is equal to 100 square feet) are treated differently. If the order is for more than 100 squares Steelite encourages, and for those orders involving engineered or non-standard materials it requires, the distributor to consult Steelite's Inside Sales Department or its Engineered Sales Department to obtain a price quotation.
The Steelite Inside Sales Department provides "unit price quotations" to Steelite distributors. A unit price quotation is the price quotation for a specified quantity of a particular material (that specification requires reference to the type and gauge of base metal, the profile of the panel, the color, the coating, if any, and the finished lengths of the panels). The Engineered Sales Department, on the other hand, provides "engineered lump sum" price quotations to Steelite distributors. To obtain an engineered lump sum quotation from Steelite, the distributor must provide Steelite with the job construction and siding plans. These plans are reviewed by Steelite engineers who then prepare a price quotation based on determinations of the necessary materials required to complete a given job.
Steelite will provide unit prices or engineered lump sum prices for any job. However, once a distributor requests an engineered price on a particular job, Steelite will not quote (or sell) at a price calculated purely on a unit price basis because, as already noted, the preparation of the engineered price in and of itself increases costs to Steelite.
CRMC began as a materials-only distributor of Steelite products in 1977. Sometime thereafter Steelite and CRMC entered into an oral distribution arrangement. Purportedly, this contract was terminable at will by either party. Subsequently, the relationship between Steelite and CRMC began to deteriorate.
The situation between Steelite and CRMC worsened when, in April 1983, three Steelite distributors (including CRMC and Oxhandler) submitted construction plans and specifications for an airplane hangar construction job (the "IBM Job") and asked Steelite to prepare an engineered lump sum price quotation for the siding required. On or about May 10, 1983, Steelite forwarded the price quotation to the appropriate distributors.
Lecesse Bros., the general contractor on the IBM Job, did not award the siding sub-contract to any of the Steelite distributors. Instead, Lecesse apparently awarded the siding contract to Independent Metal ...