Northwest Power Products, Inc. v. Omark Industries, Inc.

Northwest Power Products, Inc. (Northwest) (plaintiff) distributed powder actuated tools (PAT) and supplies used in the construction industry and manufactured by Omark Industries, Inc. (Omark) (defendant). Northwest held a 20 percent share of the market for these materials. After Omark became dissatisfied with Northwest, it began secretly negotiating with Northwest sales manager Bob Wooten (defendant). Omark representatives then told Northwest’s president that it would terminate Northwest unless management was turned over to Wooten. Northwest’s president refused to comply and fired Wooten, who was then hired by Bosco Fastening Service Center, Inc. (Bosco) (defendant), which held an 11.5 percent market share. Bosco became Omark’s new PAT distributor and hired away three additional Northwest employees, one of whom brought a valuable client list. Northwest continued its business by relying on its inventory from Omark as well as PAT items from other suppliers, though representatives of Omark and Bosco made disparaging remarks to Northwest customers concerning the state of Northwest’s business. Northwest brought suit against Omark, Wooten, and Bosco in federal district court, arguing that their conduct constituted a violation of federal antitrust laws. Northwest relied heavily on the case of Albert Pick-Barth Co. v. Mitchell Woodbury Corp. which had held that the unfair competition involved in a somewhat similar conspiracy was sufficient to constitute a violation of the Sherman Antitrust Act. The district court granted summary judgment in favor of Omark, Wooten, and Bosco. Northwest appealed to the United States Court of Appeals for the Firth Circuit.