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Sunbeam Corp. v. Windsor-Fifth Avenue Inc.

Decided: December 21, 1953.

SUNBEAM CORPORATION, PLAINTIFF-RESPONDENT,
v.
WINDSOR-FIFTH AVENUE, INC., A NEW YORK CORPORATION AND WINDSOR-FIFTH AVENUE, INC., A NEW JERSEY CORPORATION, DEFENDANTS-APPELLANTS



On appeal from Superior Court, Chancery Division.

For affirmance -- Chief Justice Vanderbilt, and Justices Heher, Oliphant, Wachenfeld, Burling, Jacobs and Brennan. For reversal -- None. The opinion of the court was delivered by Burling, J.

Burling

This appeal brings before us for review an order for an interlocutory injunction entered in favor of the plaintiff, Sunbeam Corporation (hereinafter called Sunbeam), against the defendants, Windsor-Fifth Avenue, Inc., a New York corporation and Windsor-Fifth Avenue, Inc., a New Jersey corporation (hereinafter collectively referred to as the defendants), on May 8, 1953 in the Superior Court, Chancery Division, in an action brought by Sunbeam against the defendants for enforcement of rights under resale price maintenance agreements (to which the defendants were not parties) made by Sunbeam under the Fair Trade Act of New Jersey (R.S. 56:4-3 et seq., as amended). The defendants' appeal was addressed to the Superior Court, Appellate Division, and prior to hearing there was certified on our own motion.

The pleadings in this cause show without dispute that the plaintiff Sunbeam is an Illinois corporation having its principal office and place of business in Chicago, Illinois, and that the defendants (both having the same corporate name) are corporations, one a New York corporation authorized to do business in New Jersey, and the other a New Jersey corporation. The pleadings also show without dispute that the defendants maintain and operate stores in the

municipalities of Harrison, Wallington, Maywood, Camden, Asbury Park, Union City, Elizabeth and Fords, all in the State of New Jersey, in which the defendants are engaged in the business of selling at retail electrical appliances (of many types) including items manufactured by Sunbeam and bearing Sunbeam's name and trade-marks.

The controversy exhibited by the allegations of the complaint and the denials and defenses contained in the answer demonstrate that there are involved disputed issues of fact and law remaining to be determined at the final hearing of this cause. It suffices to state that the plaintiff's suit is premised upon its resale price maintenance agreements with New Jersey retailers and distributors and seeks the remedies of injunction and accounting to such extent as Sunbeam may be entitled thereto under the Fair Trade Act of New Jersey, R.S. 56:4-3 et seq., as amended supra, The Miller-Tydings Act (see 15 U.S.C.A. 1) and the McGuire Act (P.L. 542, 82 nd Congress, 2 nd Session, c. 745, July 14, 1952). No question is asserted on this appeal concerning the constitutionality of these enactments, or any of them, nor concerning the operative effect of the New Jersey Fair Trade Act in relation to interstate commerce. See General Electric Company v. Packard Bamberger & Co., Inc., 14 N.J. 209 (1953), wherein the effect of the McGuire Act, supra, has been determined by us as having affected removal of the obstacle (of the federal anti-trust acts) to operation of the New Jersey Fair Trade Act upon interstate commerce.

This action was instituted by Sunbeam by complaint filed January 9, 1953. It was brought on for hearing in the Superior Court, Chancery Division, on the return of an order directing the defendants to show cause why interlocutory relief should not be granted to Sunbeam. The trial court, on May 8, 1953, entered an order wherein it was determined (on the pleadings and affidavits filed by the parties) that the defendants were "openly and wilfully offering for sale and selling products bearing plaintiff's trademarks for less than the minimum prices established by plaintiff's retail fair trade contracts, of which defendants

have full and ample notice," that defendants would continue so to do unless restrained and irreparable injury would thereby ensue to the plaintiff. The defendants do not attack this portion of the order on the present appeal and therefore no consideration thereof on the merits is warranted here.

The order of May 8, 1953, ante, as a consequence of the above recited findings therein set forth, ordered the defendants restrained, pending final determination of the action, "from advertising for sale, offering for sale or selling any commodities bearing plaintiff's trademarks or name at prices less than those stipulated in plaintiff's fair trade contract now in effect with retailers of electrical appliances in the State of New Jersey or at prices less than the minimum resale prices set forth in plaintiff's current retail price list furnished by plaintiff to defendants from time to time while such fair trade contracts are in force and effect." The defendants do not appeal this portion of the order.

The questions involved in this appeal are addressed to portions of the order of May 8, 1953 included (emphasis supplied for identification of the portions to which the appeal is addressed) in the following excerpts therefrom:

"And it is FURTHER ORDERED that in the event the defendants shall elect to close out their stock of goods bearing plaintiff's trade-marks for the purpose of discontinuing delivering any of such commodities, then and in such event the foregoing injunction shall be deemed modified to permit such close-out sale under the following terms and conditions:

2. Defendants shall give plaintiff at least 10 days' written notice (served on counsel for plaintiff) of the date on which it intends to commence such close-out sale to the public, and in and by such notice shall offer to resell to plaintiff or its nominee or nominees their entire stock of commodities bearing plaintiff's trade-marks at defendants' original invoice prices, for cash upon delivery; defendants shall further tender to plaintiff's representatives the original invoices establishing such invoice prices for examination and shall permit plaintiff to make photostatic copies of the same if plaintiff so desires, and to examine and verify the inventory of merchandise in the warehouse and places of business of defendants, which tender of the invoices and of the right to verification shall be made contemporaneously with the giving of notice of defendants' intention to close out their stock of plaintiff's merchandise;

3. In the event that plaintiff shall fail to act upon such notice and to accept in writing any such offer of defendants, to repurchase or cause to be repurchased defendants' entire stock of commodities bearing plaintiff's trade-marks within 10 days of its receipt of such notice, then and in such event

(c) That the said close-out sale be concluded within 60 days from the date of commencement thereof and notice of such completion be filed with the Court;

(e) That defendant shall permit the plaintiff or its duly authorized representatives, from time to time as may be reasonable, to inspect the premises of defendants in order to determine whether defendants possess any of the ...


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