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U.S. SUPREME COURT ISSUES A SECOND MAJOR RULING IN FAVOR OF INDEPENDENT SERVICE ORGANIZATIONS

 U.S. SUPREME COURT ISSUES A SECOND MAJOR RULING
 IN FAVOR OF INDEPENDENT SERVICE ORGANIZATIONS
 SAN FRANCISCO, Oct. 13 /PRNewswire/ -- For the second time in four months, the United States Supreme Court has issued a major ruling in favor of independent service organizations bringing antitrust suits against manufacturers of complex durable equipment. Virtual Maintenance Inc., one of the leading members of Independent Service Network International (ISNI), the largest trade organization of independent computer and medical equipment maintainers, has today prevailed in its petition to the Supreme Court to vacate an appellate court decision which had taken away from Virtual the $25.3-million verdict which it obtained against Prime Computer Inc. in October 1990.
 The earlier Supreme Court decision, Eastman Kodak Co. v. Image Technical Service, et al., held last June that the antitrust laws could apply to aftermarkets, such as the maintenance of complex durable equipment like copiers or computers. That case, however, had been decided by a judge in a summary judgment proceeding before a jury trial could occur. The Supreme Court sent it back to the trial court for a jury trial, which has still not yet occurred.
 In contrast, the Virtual case has gone through a full jury trial. therefore, the Virtual case goes a step beyond Kodak because no further trial need occur. The Supreme Court sent the Virtual case back to the appellate court, not the trial court, so that the appellate court can reconsider its now vacated decision in light of the Kodak opinion.
 Both Kodak and Virtual involved an antitrust practice called tying. Kodak required purchasers of its unique spare parts also to purchase photocopier maintenance from Kodak, that is, Kodak "tied" maintenance purchases to spare parts purchases. Prime required purchasers of its unique software updates also to purchase computer maintenance from Prime.
 "We are delighted that one of our members has had the courage and energy to fight this case through to the Supreme Court," said Claudia Betzner, executive director of the ISNI. "This decision shows that the Kodak case was not a fluke and that our legal system will protect service companies in competition with manufacturers."
 ISNI's general counsel, Ronald S. Katz of the law firm of Coudert Brothers, stated that "These two major decisions preserve competition in aftermarkets. Because most economic activity now occurs in aftermarkets -- like blades for razors, film for cameras, or service for computers or cars -- these opinions will have a tremendous positive impact on our economy.
 -0- 10/13/92
 /CONTACT: Claudia Betzner, executive director of the ISNI, 404-816-1610, or Ronald S. Katz of Coudert Brothers, 415-986-1300, for ISNI/ CO: Virtual Maintenance Inc.; Prime Computer Inc.; Eastman Kodak Co.; ISNI ST: California IN: CPR SU:


SG-GT -- SF012 -- 9627 10/13/92 19:49 EDT
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Publication:PR Newswire
Date:Oct 13, 1992
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