Brierwood Shoe Corp. v. Sears, Roebuck, & Co.

501 F. Supp. 144, 1980 U.S. Dist. LEXIS 14540
CourtDistrict Court, S.D. New York
DecidedOctober 21, 1980
DocketNo. 79 Civ. 2832
StatusPublished

This text of 501 F. Supp. 144 (Brierwood Shoe Corp. v. Sears, Roebuck, & 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
Brierwood Shoe Corp. v. Sears, Roebuck, & Co., 501 F. Supp. 144, 1980 U.S. Dist. LEXIS 14540 (S.D.N.Y. 1980).

Opinion

MEMORANDUM AND ORDER

BRIEANT, District Judge.

By motion filed September 22, 1980, defendant Sears, Roebuck and Co. (“Sears”) moved in this case for “partial” summary judgment pursuant to Rule 56, Fed.R.Civ.P.

Plaintiff Brierwood Shoe Corporation (“Brierwood”) is a Pennsylvania corporation which, when the action was filed on June 1, 1979, was engaged in manufacture of various types of men’s, women’s and children’s shoes. It employed approximately 2,300 persons in 14 plants. Defendant Sears, a New York corporation, is a large retailer of general merchandise, including shoes.

[146]*146On October 3, 1971, Sears and Brierwood entered into a written basic buying agreement (“Agreement”) whereby Brierwood agreed to manufacture and Sears to purchase various percentages of Sears requirements of men’s, women’s and children’s shoes. Sears received the optio-n to require Brierwood to manufacture and sell to Sears additional quantities of shoes pursuant to the terms of the Agreement. The Agreement set forth a procedure for production and ordering of the shoes, and also set forth a formula for determining the contract price of the shoes.

On April 10, 1979 Sears gave notice that it would terminate the Agreement in October, 1980, pursuant to the terms of Paragraph 16 thereof. That notice gave rise to this litigation, consisting of three separate federal lawsuits. On May 30, 1980 this Court granted Brierwood’s motion to consolidate three pending actions involving Sears, Brierwood, and Kleinert’s, Inc. and to file a second amended complaint.

Sears and Brierwood filed a consolidated pre-trial order on July 21, 1980 and argument on this motion for partial summary judgment was heard on October 1, 1980. Both parties have filed briefs and reply briefs.

Subject matter jurisdiction exists under 28 U.S.C. § 1332, 15 U.S.C. §§ 15 and 15/26" style="color:var(--green);border-bottom:1px solid var(--green-border)">26, and pendent jurisdiction. The parties have stipulated that the law of Pennsylvania governs the non-federal claims pleaded.

The pre-trial order contains sixteen separate claims for relief by Brierwood.

While Rule 56, Fed.R.Civ.P., authorizes a claimant or a defendant to move for summary judgment in a case as to “all or any part thereof,” Rule 56 does not provide for a “partial” summary judgment that is a final judgment. See 6 Pt. 2 Moore’s Federal Practice ¶ 56.20[3.-2], Rather, in combination with Rule 16, Fed.R.Civ.P., which sets forth the procedure for formulating a pre-trial order, this Court will treat the motion for “partial" summary judgment in this case as a means of separating those claims which need to be tried from those which can be disposed of because they do not involve any relevant disputed factual issues.

For purposes of this motion, we must accept the facts as alleged in the light most favorable to the non-moving party. We consider the separate points below.

Prima Facie Tort

Sears argues that Pennsylvania does not recognize a claim for prima facie tort, while Brierwood asserts the opposite. Both rely upon Tarr v. General Electric Co., 441 F.Supp. 40 (W.D.Pa.1977): In that ease, a franchised dealer of General Electric (“GE”) products had his franchise terminated by GE by non-renewal in accordance with the terms of the franchise agreement. Id. at 40. Plaintiff in that case claimed that it was terminated in retribution for ’having filed an antitrust action against GE. Id. at 40. The district court held that the plaintiff’s claim set forth “damnum absque injuria." Id. at 42.

Brierwood has cited no Pennsylvania cases which have recognized a cause of action for prima facie tort and the Court has been able to find none. Rather, as noted by the Tarr court, the Pennsylvania Supreme Court has stated:

“Malicious motives make a[n] bad act worse, but they cannot make that wrong which, in its own essence, is lawful.”

Yarnail’s Estate, 376 Pa. 582, 592, 103 A.2d 753, 759 (1954), quoting Jenkins v. Fowler, 24 Pa. 308, 310 (1855).

If the termination of the Agreement by Sears did not constitute a breach of contract or a tortious interference with contractual relations, the mere assertion that Sears acted maliciously does not give rise to a tort in Pennsylvania.

Sherman Act Claims

Brierwood’s claims under section 1 et seq. of the Sherman Act, 15 U.S.C. § 1 et seq., are based on its contention that Sears had the practice of charging Brierwood a greater price for raw materials than Sears itself had paid for the materials. These raw materials were used by Brierwood in the manufacture of shoes later sold to Sears.

[147]*147Brierwood alleges, first, that Sears had a resale price maintenance agreement with “certain raw materials vendors,” whereby Sears was compelled to abide by price lists furnished by the raw materials vendors. Brierwood also alleges that Sears engaged in reciprocal dealing, using its buying power under the Agreement to force Brierwood to buy raw materials from Sears at disadvantageous terms.

1. Resale Price Maintenance

Sears argues that Brierwood’s Sherman Act claims are barred because Brierwood suffered no competitive injury, as required by the Clayton Act § 4, 15 U.S.C. § 15, which provides the treble damage remedy for Sherman Act violations. See Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 489, 97 S.Ct. 690, 697, 50 L.Ed.2d 701 (1977); GAF Corporation v. Circle Floor Co., Inc., 463 F.2d 752, 757 (2d Cir. 1972), cert. denied, 413 U.S. 901, 93 S.Ct. 3058, 37 L.Ed.2d 1045 (1973).

While resale price maintenance agreements are per se violative of the Sherman Act, see Yentsch v. Texaco, Inc., 630 F.2d 46 (2d Cir., 1980), a plaintiff has no standing to challenge such an agreement if it has suffered no competitive injury. Brierwood must be able to prove that the “illegal restraint of trade injured [its] competitive position in the business in which [it] is or was engaged.” GAF Corp., supra, at 758 (emphasis in original). The plaintiff in GAF Corp. had alleged that its sales to the defendant had decreased in volume and that plaintiff had thereby suffered lost profits. GAF had not, however, shown an inability to sell floortile such that its ability to compete in the entire market place was damaged. Id. at 759.

Brierwood has not met the requirements enunciated in GAF Corp.

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Related

Hanover Shoe, Inc. v. United Shoe MacHinery Corp.
392 U.S. 481 (Supreme Court, 1968)
Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc.
429 U.S. 477 (Supreme Court, 1977)
Illinois Brick Co. v. Illinois
431 U.S. 720 (Supreme Court, 1977)
Gaf Corporation v. Circle Floor Co., Inc.
463 F.2d 752 (Second Circuit, 1972)
Tarr v. General Electric Co.
441 F. Supp. 40 (W.D. Pennsylvania, 1977)
Yarnall Estate
103 A.2d 753 (Supreme Court of Pennsylvania, 1954)
Jenkins v. Fowler
24 Pa. 308 (Supreme Court of Pennsylvania, 1855)

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501 F. Supp. 144, 1980 U.S. Dist. LEXIS 14540, Counsel Stack Legal Research, https://law.counselstack.com/opinion/brierwood-shoe-corp-v-sears-roebuck-co-nysd-1980.