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Then the big boysCoca-Cola and Pepsiarrived and began taking over the market. In Dudley’s Northeast Texas territory, Coca-Cola Enterprises snapped up local bottlers to distribute Coke and Dr Pepper until it accounted for 75 to 80 percent of the total carbonated beverage sales in the region. From its position of market dominance, Coke started putting the screws to Harmar and other small beverage companies. As Coke moved in, Dudley says, it kept getting harder and harder for the dwindling number of independent bottlers to make a go of it. Coke cut deals with retailerscalled calendar marketing agreementsthat gave preferential treatment to Coke products. Soda companies compete fiercely for the best shelf space and promotions in stores, particularly convenience stores, where they make most of their profits. Harmar products, such as Royal Crown Cola and 7 UP, were being consigned to the bottom shelf in refrigerators and aisles, with little way to announce their presence. Entire product linessuch as A&W Root Beer, Orange Crush and Country Time Lemonadewere prohibited by name from some stores. In other instances, shops were required to price Coca-Cola products lower than their competitors, in effect forcing retailers to increase the price of Harmar’s drinks, even when their wholesale cost was lower. And, Dudley notes, in stores where his drinks were forced out entirely, the price of Coke would go up, sometimes by as much as a dime. “Ten cents doesn’t sound like much,” Dudley says, “but there’s 24 bottles in a case. That’s $2.24 per case, and they do millions of casesso we’re talking about a huge amount of money.” In 1994, Harmar and the other bottlers filed their lawsuit against Coca-Cola and Coca-Cola Enterprises, alleging violations of the Texas Free Enterprise and Antitrust Act, which outlaws companies from engaging in predatory, anticompetitive business practices. \(Pepsi and its bottler sent an expert When the suit came to trial in 2000, the case turned on whether Coca-Cola’s actions constituted a harm to competition, which is forbidden under Texas antitrust law, or harm to competitors, which occurs every day in a free market. “Part of what goes on in business world is taking business away from competitors,” says Jerry Beane, a lawyer for CocaCola Enterprises. “When you do that, your competitor suffers some sort of harm as a result. It’s no more complicated than Toyota selling a lot of cars or trucks to people who otherwise would have purchased Ford or GM vehicles. That’s the process of competition.” Roach, who represented Harmar, counters that by limiting a company’s ability to reach consumers in retail outlets, Coca-Cola harmed competition. Moreover, in the soft drink business, harm to competitors raised red flags as well. “The cola market is a mature, highly concentrated market with high barriers to entry,” Roach says. “That means if you get rid of somebody, nobody is going to re-enter the market and compete against you.” On June 21, 2000, a jury found Coca-Cola guilty of antitrust violations. Although the judge refused to order Coke to sell its Dr Pepper distribution rights as the plaintiffs had requested, he awarded the bottlers $15.6 million in damages. Coke appealed the decision. In 2003, a unanimous state court of appeals affirmed the trial court’s finding that Coke’s marketing agreements “could be read to restrict trade and impact competition” in violation of antitrust laws. If the story ended there, it likely would be a footnote in the modern struggle between big corporations and independent businesses, and a mere skirmish in the global cola wars. But Coca-Cola challenged the appellate court decision, and the Texas Supreme Court took the case. A year later, it heard oral arguments. After letting the case languish on its docket for another two years, the court reversed the jury’s decision. he right to a jury trial is enshrined in both the Texas and U.S. constitutions. Whether it’s a 12-person trial for criminal cases or seven for civil proceedings, jurors are entrusted to consider the facts and render judgment. Judges provide the jury with guidance on points of law, but in the end, it’s the jury that weighs the competing claims and arguments of both sides and determines where the truth lies. “The judiciary is the only branch of government where the ordinary citizen has the authority to decide civil and criminal issues, and juries have unlimited authority under the Constitution with regard to their findings of fact,” says U.S. District Judge Sam Sparks of Austin. “It’s really an amazing system, and it’s worked for well over 200 years.” Jury verdicts are often appealed by the losing party, but usually those appeals turn on a point of lawwhether evidence was admissible or not, or the jury received improper instructions from the judge, or there was some other sort of procedural mistake. Rarely will a courteven the U.S. Supreme Courtdelve into the validity of a jury’s findings of fact. According to Texas legal precedent, an appeals court will reverse a jury’s ruling only if there is no more than a “mere scintilla” of evidence to prove some essential fact that the jury relied on to reach its verdict. But lack of evidence was one of the key pegs on which the Texas Supreme Court hung its decision to overturndespite what many who have reviewed the case believe to be an abundance of evidence to support the jury’s decision. Writing for the majority, Justice Nathan Hecht based his ruling on two factors: First, he adopted an argument made in a friend-of-the-court brief by the attorney general of Alabama by holding that Texas courts have no jurisdiction over antitrust violations in other states. Second, Hecht struck down the jury verdict as applied to antitrust violations in Texas, writing that the plaintiffs had presented no evidence that the market as a whole was harmed by Coca-Cola’s actions. There was no evidence that a substantial amount of competition was adversely affected, he wrote, and no evidence that prices were generally higher. Any proof of market harm was in “relatively 12 THE TEXAS OBSERVER MAY 4, 2007