Ryko Manufacturing Corp. v. Delta Services, Inc.

625 F. Supp. 1247, 1985 U.S. Dist. LEXIS 13080
CourtDistrict Court, S.D. Iowa
DecidedDecember 9, 1985
DocketCiv. No. 83-352-E
StatusPublished
Cited by2 cases

This text of 625 F. Supp. 1247 (Ryko Manufacturing Corp. v. Delta Services, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. Iowa primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ryko Manufacturing Corp. v. Delta Services, Inc., 625 F. Supp. 1247, 1985 U.S. Dist. LEXIS 13080 (S.D. Iowa 1985).

Opinion

ORDER

DONALD E. O’BRIEN, Chief Judge.

The court has before it defendants’ motions for a preliminary injunction and to compel plaintiff to comply with this court’s order of May 24, 1985. An evidentiary hearing was held on this matter at which counsel for all parties was present. After carefully considering the briefs, oral arguments and evidence, the court grants plaintiff’s motion for a preliminary injunction in part and denies it in part. The court also grants defendants’ motion to compel plaintiff’s compliance with this court’s previous order.

I. Defendants’ Motion for a Preliminary Injunction.

In determining whether a preliminary injunction should be issued, the court is guided by Dataphase Systems, Inc. v. C L Systems, 640 F.2d 109 (8th Cir.1981), where the Eighth Circuit Court of Appeals found:

Whether a preliminary injunction should issue involves consideration of (1) the [1248]*1248threat of irreparable harm to the movant; (2) the state of the balance between this harm and the injury that granting the injunction will inflict on the other parties litigant; (3) the probability that movant will succeed on the merits; and (4) the public interest.

Id., at 114. As a general rule, a movant has not established irreparable harm where damages would adequately compensate the movant for the asserted harm. See ABA Distributors, Inc. v. Adolph Coors Co., 661 F.2d 712, 714 (8th Cir.1981). Yet, irreparable injury has been characterized as loss of a movant’s enterprise. See Semmes Motors, Inc. v. Ford Motor Co., 429 F.2d 1197, 1205 (2d Cir.1970); Fort Smith Beepers, Inc. v. Mobilefone Service, 533 F.Supp. 685 (W.D.Ark.1981); Paschall v. Kansas City Star Co., 441 F.Supp. 349 (W.D.Mo.1977).

The defendant has presented several actions it would like to enjoin. Delta summarized its position by breaking it down into thirteen points in the final argument during the injunction hearing. For the sake of simplicity, the court will address the injunction in terms of the thirteen points in the order in which they were presented.

Point 1. Delta first requests that Ryko pay Delta its commission within three days after Delta has turned in an installation completion form. At the hearing on this motion, Tom Carlton, the national sales manager for Ryko, testified that while Ryko had been tardy in previous commission payments to Ray Black, for the last year and a half, Ryko had been averaging payments in less than five days. Black, however, testified that he is still waiting a long time for his commissions.

In applying the Dataphase factors to this problem, the court finds that the tardiness of the commissions is likely to threaten Delta’s “business enterprise” in that Delta is being denied payments that help keep the business afloat. The court finds the harm involved in delinquent commission payments to greatly outweigh any injury inflicted on Ryko if this court were to require Ryko to make prompt commission payments to Delta. Further, prompt payments would likely lead to better relations between the parties. With respect to the third factor, the probability that the movant will succeed on the merits, the court finds this action to fall under defendants’ claim that Ryko is not acting in a businesslike manner. The likelihood that plaintiff will ultimately prevail must be examined in the context of the relative injuries to the parties and the public. Dataphase Inc. v. C L Systems, Inc., 640 F.2d at 113. Where the movant has raised a substantial question and equities are otherwise strongly in his favor, the showing of success is less stringent. Id. At minimum, the instant case presents this court with a controversy. In light of the other equities involved, the court concludes that Delta has established a sufficient probability of success on the merits to be entitled to preliminary relief. Finally, as to the public interest factor, the court finds that the granting of the requested injunction would not harm the public.

Having considered the Dataphase factors, the court therefore holds that Ryko should be required to reimburse Delta in a prompt manner. The court finds that five days from receipt of the installation completion form is a reasonable time requirement and therefore orders Ryko to pay Delta within that amount of time.

Points 2, 3, 5 and 6. In Points 2, 3, 5 and 6, defendants ask the court to order plaintiff to increase efforts in helping defendants sell Ryko equipment in Louisiana. In particular, defendants ask that (1) Black be able to attend all meetings involving Ryko officials and potential buyers occurring in Louisiana, as well as all conventions or trade shows in that state, (2) Dayton Hedges be assigned sales representatives in Louisiana, and (3) Black be able to talk to more Ryko officials.

With respect to allowing Black the opportunity to attend meetings, conventions and trade shows involving Ryko in the State of Louisiana, the court finds that Black’s absence from such events is very embarrass[1249]*1249ing for Black and would injure Delta Services’ “business enterprise,” and therefore, finds that there is a threat of irreparable harm. The court also finds that the harm that would occur from allowing Black to attend such events is greatly outweighed by the harm that would occur if Black were prohibited from attending. With regard to Dataphase factors three and four, the court adopts its analysis as given in its review of Point 1 above. As a result, the court finds that Black is entitled to notification of any meeting between a Ryko official and a prospective buyer in the State of Louisiana as well as any convention and/or trade show in that state. Black also has the right to attend such meetings and events if he so desires.

With respect to defendants’ request that plaintiff be able to talk to more Ryko officials, Tom Carlton testified that only Julian Klein and Jim Nelson do not speak with Black. While Ryko at one point allowed only Carlton to speak with Black, any Ryko official except for Klein and Nelson is now able to speak with Black. Because Black can speak with all but two officials, the court is unable to find defendants irreparably harmed.1 A finding that there is no irreparable harm is sufficient grounds for denying a preliminary injunction. See Dataphase Systems, Inc. v. C L Systems, Inc., 640 F.2d at 114 n. 9. As a result, the court denies defendants’ motion for a preliminary injunction as to that point.

Applying the Dataphase factors to defendants’ request to have Dayton Hedges become the sales representative in Louisiana, the court is again unable to find that defendants are being irreparably harmed by not being able to deal with Dayton Hedges. The court therefore denies defendants’ motion as to that point. The court reiterates its past position that it would be to both parties’ best interest to cooperate in their dealings with each other.

Points 4 and 8.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Southeast Arkansas Hospice, Inc. v. Sebelius
1 F. Supp. 3d 915 (E.D. Arkansas, 2014)

Cite This Page — Counsel Stack

Bluebook (online)
625 F. Supp. 1247, 1985 U.S. Dist. LEXIS 13080, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ryko-manufacturing-corp-v-delta-services-inc-iasd-1985.