Bowles v. W. T. Grant Co.

57 F. Supp. 773, 1944 U.S. Dist. LEXIS 1805
CourtDistrict Court, S.D. New York
DecidedSeptember 28, 1944
StatusPublished
Cited by2 cases

This text of 57 F. Supp. 773 (Bowles v. W. T. Grant Co.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bowles v. W. T. Grant Co., 57 F. Supp. 773, 1944 U.S. Dist. LEXIS 1805 (S.D.N.Y. 1944).

Opinion

LEIBELL, District Judge.

The defendant, W. T. Grant Co., moves for a summary judgment dismissing the complaint and vacating a temporary injunction heretofore issued herein.

On August 8, 1943, the OPA filed separate complaints and obtained orders to show cause containing temporary restraining provisions against four of the larger low-price variety retail chain stores — W. T. Grant Co., McCrory Stores, J. C. Penney Company and J. J. Newberry Company. In each case the complaint charged the defendant with selling goods above the maximum prices allowed by Maximum Price Regulation 330. The injunctions in all four suits are identical, enjoining defendants from:

“1. Selling or delivering Women’s, Girls’ and Children’s Outerwear Garments at prices in excess of the maximum prices established by Maximum Price Regulation No. 330;
“2. Doing or omitting to do any other act in violation of said Regulation, as heretofore or hereafter amended; and
“3. Offering, soliciting, attempting or agreeing to do any of the foregoing.”

By stipulation, the restraining provisions in the Grant suit were continued as an injunction pendente lite, without prejudice to a motion to’ vacate; and an order to that effect was entered August 17, 1943.

The affidavits of several OPA personnel on the application for the temporary injunction in the Grant case charged violations of the highest price line limitation-stating that some of the stores in the Grant chain had violated MPR 330 by selling merchandise at price levels for the specified category of garment, which were above the levels carried by the stores during the base period. Maximum Price Regulation No. 330 was intended t’o govern retailers’ and wholesalers’ prices for women’s outerwear garments. One of the affidavits alleged that 16 of Grant’s 493 stores violated the highest price line limitation in 18 categories, resulting in a total “overcharge” of about $11,500. A second affidavit urged the economic necessity of a [775]*775highest price line limitation to prevent stores from dropping cheaper lines and taking on more expensive lines. A third affidavit alleged five highest price line violations in one particular Grant store as of May 25, 1943, and annexed a statement from the manager of the store stating that all of the items sold at the higher price lines were items of better style and materials than the items previously carried.

The defendants in the four suits answered the complaints and the answers attacked the method of promulgating MPR 330, the constitutionality of the Emergency Price Control Act, and the constitutionality of the Regulation. On a motion to strike the defenses, Judge Rifkind declared the Act to be constitutional, and ruled out most of the other defenses. He pointed out that the defendants still had other ways of objecting to the Regulation within the OPA and before the Emergency Court of Appeals. D.C., 53 F.Supp. 182. Following this decision, OPA sent interrogatories to the defendants requesting information as to the conduct of their sales in various stores in regard to the “highest price line” regulation. On receiving answers from the defendants in two of the suits, indicating some such violations, OPA moved for summary judgment and permanent injunctions. The motion in the Penney case, Brown v. J. C. Penney Co., D.C., 53 F.Supp. 182, was adjourned by stipulation. The motion for summary judgment and permanent injunction in the McCrory case was denied by Judge Clancy in the following opinion:

“Since the Supreme Court has decided in Brown v. Hecht Company [D.C., 49 F. Supp. 528] that an injunction does not follow automatically from an established violation of the Emergency Price Administrator’s regulations or of the statute, it would seem that if an injunction should ever be granted on the facts in this case it could be justified only by demonstrating the character of defendant’s conduct to be such as to warrant the imposition of an injunction. This demonstration can be had only by a trial. It is not impossible that the infractions attributed to defendant were not within the spirit of the law. The motion is denied.”

By stipulation, the defendant in the Grant suit did not give written answers to the interrogatories, but instead submitted to oral examination. This examination was held on February 9, 10 and 17, 1944. Mr. Seidel, the Comptroller of the Grant Co., was examined by Atwood Cranston, Esq., Enforcement Attorney of the OPA. The first part of the examination dealt with the instances of highest price line violations cited by Mr. Cranston in his affidavit upon which the order to show cause had issued. The oral testimony was to the effect that in 28 of the 31 instances of violations alleged in the affidavits, the OPA was in error as to what had been the highest price line sold during the base period. Further, the Grant Company contended that the statement by the store manager attached to the Administrator’s moving affidavits was not reliable, since the manager who signed the report was manager of the store for only two months and did not know what had been sold earlier.

The examination of the defendant Grant was then directed to the 88 questions and 524 alleged violations of the highest price line limitation specified in the interrogatories. The Grant Company claimed that it was difficult to find out what actually were the highest prices charged in their separate stores during the base period, because their invoices were kept under the name of the manufacturer who furnished the goods and not under the store to which they were sent, or by the period in which they were sent. For a company receiving ten to twenty thousand invoices a day a complete check on these questions would probably require a great deal of time and labor. Difficulties also were experienced because of the wide differences between the categories defined by the OPA and the categories used by the Grant Company in its business during the base period.

The oral examination was also directed to the reports of the investigators employed by the OPA, and numerous errors were noted. In some instances the investigators could not state definitely whether a specific garment belonged to one OPA category or another, and there were inaccuracies in the investigators’ statements of the highest price lines carried by the stores during the base periods.

On June 30, 1944, the Emergency Price Control Act of 1942 was reenacted, but with the following new section (among others) :

“Sec. 2(k) No regulation, order, or price schedule issued under this Act shall, after the effective date of this subsection, require any seller of goods at retail to limit his sales with reference to any highest price [776]*776line offered for sale by him at any prior time.” 50 U.S.C.A. Appendix § 902(k).

The Congressional Conferees report, dated June 20, 1944, stated in reference to the above subsection that “Regulations, orders, or price schedules heretofore issued, insofar as they are inconsistent with this subsection will become inoperative.” On July 5, 1944, the Administrator issued Supplementary Order No. 93, effective as of June 30, 1944, when the subsection of the Act became effective.

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68 F. Supp. 403 (W.D. Pennsylvania, 1946)
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64 F. Supp. 582 (W.D. Pennsylvania, 1946)

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Bluebook (online)
57 F. Supp. 773, 1944 U.S. Dist. LEXIS 1805, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bowles-v-w-t-grant-co-nysd-1944.