United States v. Foley

The prevailing commission rate for real estate agents in Montgomery County, Maryland was 6 percent of the sales price. John Foley (defendant), president of Jack Foley Realty, Inc. (defendant), hosted a dinner with the other leading realtors in Montgomery County (defendants). At the dinner, Foley stated to the group that he was increasing his sales commission rate to 7 percent. There was conflicting evidence as to what else was said at dinner, but some evidence suggested that each realtor indicated a willingness to adopt the 7 percent rate. There was also evidence that the group discussed one realtor’s prior attempt to raise commissions to 7 percent, which failed because competing realtors kept their commissions at 6 percent. Within a few months of the dinner, the defendants all raised their commission rates to 7 percent. There was evidence that Foley had contacted other defendants in the months following the dinner and stated if they all did not stick to the “agreement,” the attempt to raise commissions would not succeed. The United States government (plaintiff) charged the defendants with a commission-fixing conspiracy in violation of § 1 of the Sherman Act. The defendants were found guilty following a jury trial. The defendants appealed, arguing, among other things, that Foley’s purpose for calling the dinner was not made known until after the meal, once the other defendants were already there. The defendants claimed that unless the realtors had rejected the dinner invitation or left once Foley revealed the dinner’s purpose, they had no way to avoid the factual inferences the jury drew regarding the defendants’ involvement in the conspiracy.