## Facts

- Professional Real Estate Investors, Inc. and Kenneth F. Irwin operated the La Mancha Private Club and Villas, a resort hotel in Palm Springs, California.
- PRE installed videodisc players in hotel rooms and rented videodiscs of motion pictures to guests for in-room viewing, and sought to develop a broader market for hotel in-room viewing systems.
- Columbia Pictures Industries, Inc. and other studios owned copyrights in films included in PRE’s videodisc library and licensed hotel in-room film transmission services.
- Columbia sued PRE for copyright infringement based on PRE’s in-room videodisc rental practices.
- PRE asserted antitrust counterclaims under Sherman Act §§ 1 and 2, alleging Columbia’s infringement suit was a sham intended to restrain competition and further monopolization.

## Issues

1. Under Noerr–Pennington petitioning immunity, when does litigation fall within the “sham” exception and lose antitrust immunity?
2. Whether a lawsuit can be deemed a sham based solely on the plaintiff’s alleged lack of sincere belief in the merits, despite the existence of probable cause.

## Decision

- The Supreme Court unanimously affirmed judgment for Columbia.
- Litigation is not a sham unless it is objectively baseless, meaning no reasonable litigant could realistically expect success on the merits.
- Only after a showing of objective baselessness may a court consider the litigant’s subjective motivation.
- Because Columbia had probable cause to bring its copyright action, the suit was not objectively baseless and remained protected by Noerr–Pennington immunity; PRE’s antitrust counterclaims failed.

## Legal Principles

- Noerr–Pennington generally immunizes petitioning activity, including access to courts, from antitrust liability even if motivated by anticompetitive aims.
- “Sham” litigation requires a two-part showing in sequence:
  - The challenged suit must be objectively baseless (no reasonable expectation of success).
  - If objectively baseless, the court may then examine whether the suit was brought to interfere directly with a competitor’s business relationships rather than to obtain judicial relief.
- Probable cause—understood as a reasonable belief that a claim may be held valid upon adjudication—defeats a sham-litigation claim as a matter of law and makes subjective intent irrelevant.

## Conclusion

The Court defined sham litigation narrowly: antitrust plaintiffs must first prove the challenged lawsuit was objectively baseless; absent that threshold showing, Noerr–Pennington immunity applies and alleged bad motive alone cannot create antitrust liability.


Pro. Real Est. Invs., Inc. v. Columbia Pictures Indus., Inc., 508 U.S. 49 (1993)