Sobel Paper & Wire Co. v. Great Atlantic & Pacific Tea Co.

343 F. Supp. 386, 1972 U.S. Dist. LEXIS 14284
CourtDistrict Court, E.D. Pennsylvania
DecidedApril 10, 1972
DocketCiv. A. No. 72-494
StatusPublished
Cited by1 cases

This text of 343 F. Supp. 386 (Sobel Paper & Wire Co. v. Great Atlantic & Pacific Tea Co.) is published on Counsel Stack Legal Research, covering District Court, E.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sobel Paper & Wire Co. v. Great Atlantic & Pacific Tea Co., 343 F. Supp. 386, 1972 U.S. Dist. LEXIS 14284 (E.D. Pa. 1972).

Opinion

MEMORANDUM AND ORDER

CLIFFORD SCOTT GREEN, District Judge.

This is a motion for a preliminary injunction predicated on § 210 of the Economic Stabilization Act (the “Act”), as amended by Public Law 92-210, approved December 22, 19711, in which [388]*388plaintiff seeks to prohibit defendants from carrying out the terms of a contract entered into by them, allegedly in violation of the Act. Both defendants have moved to dismiss the complaint. On the basis of testimony adduced at a hearing, oral argument, and memoranda of law, we deny the motions of plaintiff and of defendant The Great Atlantic and Pacific Tea Co., Inc. (“A&P”), but grant the motion of defendant Vigianno Brothers (“Vigianno”), for the reasons set forth below.

The pertinent facts are these. Plaintiff, Vigianno, and two other enterprises not party to this suit, are engaged in the business of buying and selling waste paper products and were asked by defendant A&P to submit bids for a one year contract (beginning in March, 1972) for the purchase of A&P’s corrugated waste in baled form at A&P’s Yeadon, Pennsylvania, warehouse where the cardboard waste from all of A&P's stores in the Philadelphia area is collected and baled. Plaintiff had had with A&P the corrugated waste contract for the two years immediately prior to March, 1972,2 and quoted to A&P a price which plaintiff said was the maximum which A&P was permitted to charge under the Act’s price freeze regulations. That price, according to plaintiff’s calculations, was $18.16 per ton. Vigianno bid $22.00 per ton and was awarded the contract.

Plaintiff contends that A&P’s request for bids, when interpreted in light of the surrounding circumstances, really constituted an offer to contract with the highest legal bidder and that plaintiff successfully accepted the offer, and bound A&P, because the two bids in excess of $18.16 per ton were above the permitted frozen base price. Accordingly, plaintiff argues that, but for A&P’s violation of the Act, plaintiff would have been the contracting party with A&P.

Defendants contend that plaintiff has no standing under the Act and that the waste products in question are exempt from price regulations. Alternatively, defendants argue that A&P’s request for bids was a solicitation for offers rather than an offer and that, in any event, plaintiff’s bid was not the highest legal bid. We need not decide any of the foregoing issues in order to dispose of plaintiff’s motion,3 for even if we were to resolve them in favor of plaintiff, plaintiff would not be entitled to the equitable relief he seeks.

In Midland-Ross Corp. v. Sunbeam Equipment Corp., 316 F.Supp. 171 (W.D.Pa.1970), aff’d, 435 F.2d 159 (3 Cir.), the Court discussed the requirements which must be satisfied before a preliminary injunction can be granted:

Plaintiff must show, not alternatively but conjunctively, three things: first, that plaintiff will suffer immediate irreparable injury if the preliminary injunction is not granted; second, that balancing the conveniences and possible injuries to both parties, the scales of equity weigh in favor of plaintiff; and third, that plaintiff is reasonably likely to succeed in establishing its case on the merits in a full hearing for final injunctive relief. [Citations omitted.] 316 F.Supp. at 173.

Accordingly, we may deny plaintiff’s motion on our finding alone that plaintiff will suffer no irreparable injury, much less immediate irreparable injury.

Plaintiff maintains that it is suffering irreparable harm because approximately one-third of its gross sales of waste materials is attributable to corrugated waste purchased from A&P and [389]*389that the loss of the A&P contract will consequently so damage plaintiff as to drive it out of business.

Assuming that plaintiff has been legally harmed by A&P’s breach of contract arising from a violation of the Act, plaintiff’s injury is ultimately reducible to a loss in profits, an injury very much remediable at law. For plaintiff to argue that it has a right to injunctive relief because it will be irreversibly crippled by the loss of A&P’s business is to argue that plaintiff somehow had a vested right to the A&P contract and that the loss of the contract constitutes an illegal expropriation of plaintiff’s basic earning power. Such an argument simply ignores the facts that A&P let the contract on a year-to-year basis and that as long as plaintiff had the contract with A&P, plaintiff was always subject to the loss of A&P’s business if A&P decided not to renew the contract with plaintiff. (Indeed, since the contracts have apparently always contained a ninety-day notice termination clause, plaintiff’s right to A&P’s business at any one time was always somewhat precarious.) Plaintiff could, thus, claim loss of profits for one year, at most, (excluding reduction by way of plaintiff’s duty to mitigate damages) and computation of such profits would be uncomplicated and unspeculative since pricing and tonnage records appear to be kept as a matter of course.

Finally, there has been no showing that A&P’s contract provided a unique source of corrugated waste. On the contrary, the testimony of Mr. Louis Golden, president of a nationwide waste paper buyer and seller, made clear that there were at least five or six other producers of corrugated waste on the scale of A&P in the Philadelphia area, and numerous other producers whose aggregate production would equal that of A&P’s, with whom plaintiff could bid upon termination of any existing contracts. Plaintiff’s corrugated waste business, then, could be reconstituted by merely bidding on other corrugated waste contracts in the area as they came up for bid.

Although plaintiff has failed to make out a case for injunctive relief, it has made legal allegations which are sufficient to withstand A&P’s motion to dismiss. A&P contends that § 210 gives standing to bring suit only to one who has been overcharged and that since plaintiff has paid nothing to A&P, much less been overcharged, it has suffered no legal harm within the meaning of the Act. A&P’s reading of § 210 is erroneous: the language and structure of the statute reveal a clear distinction between an “overcharge” and a “legal wrong,” indicating that “legal wrong” is a more encompassing concept than “overcharge.” First, it would be unduly anomalous for the drafters of the statute to say “legal wrong” in subsection “(a)” when they meant “overcharge” since they were able to use “overcharge” in subsection “(b)” in a very specific context and defined “overcharge” in subsection “(c).” Indeed, subsection “(b)” merely discusses one specific example of a “legal wrong” which can be expected to occur under the Act and delineates the specific remedies for that particular “wrong.” Second, if “legal wrong” meant nothing more than “overcharge,” the references in subsection “(a)” to declaratory judgment and writ of injunction would be meaningless since such forms of relief are basically inappropriate for overcharge, as made clear by subsection “(b)”’s provision for treble damages.

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Bluebook (online)
343 F. Supp. 386, 1972 U.S. Dist. LEXIS 14284, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sobel-paper-wire-co-v-great-atlantic-pacific-tea-co-paed-1972.