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Gillette Co. v. Two Guys From Harrison Inc.

Decided: February 5, 1962.

THE GILLETTE COMPANY, A CORPORATION OF DELAWARE, PLAINTIFF-RESPONDENT, AND CROSS-APPELLANT,
v.
TWO GUYS FROM HARRISON, INC., ET AL., DEFENDANTS-APPELLANTS AND CROSS-RESPONDENTS



For affirmance -- Chief Justice Weintraub, and Justices Jacobs, Francis, Proctor, Hall, Schettino and Haneman. For reversal -- None. The opinion of the court was delivered by Haneman, J.

Haneman

This appeal involves the "Fair Trade Act," N.J.S.A. 56:4-3 et seq.

Plaintiff, a Delaware corporation, conducts its business through two unincorporated divisions, Gillette Safety Razor Company (Gillette) and the Toni Company (Toni). Gillette manufactures and wholesales safety razors, razor blades and shaving creams which are resold at retail by drug stores, department stores and similar outlets. Toni manufactures and wholesales various preparations used by women in the care of the hair, which are resold in similar manner.

Vornado, Inc. (Vornado), successor to one of the original defendants, Two Guys from Harrison, Inc. (Two Guys), was joined as a defendant subsequent to the filing of the complaint herein. This successor corporation owns a chain of retail discount stores located in New Jersey and elsewhere in which it does business under the name "Two Guys from Harrison" and in which there are operated retail drug departments. Janice Products, Inc. (Janice), a wholly owned subsidiary of Vornado, operated such drug departments in one of Two Guys' stores located in Totowa and in

other Two Guys' stores throughout New Jersey and continues to so operate under Vornado. Two Guys and Janice sold plaintiff's products at retail until succeeded in operation by Vornado.

Plaintiff filed suit alleging that Two Guys and Janice were selling Gillette and Toni products in New Jersey below the fair trade prices established under N.J.S.A. 56:4-3 et seq. Plaintiff sought a two-fold judgment against all three defendants, to wit: (1) an injunction prohibiting the sale of any of its fair traded merchandise below the established fair trade price; (2) damages for past sales by defendants of any of its fair traded merchandise below the established fair trade prices.

The defendants admitted by way of stipulation at pretrial:

(1) "* * * plaintiff's commodities are in free and open competition in this state with commodities manufactured by others of the same general class, in accordance with the requirements of the New Jersey Fair Trade Law. In so stipulating defendants do not in any way waive any attempts to show by way of their affirmative defense pertaining to combination sales or alleged discrimination in refusing to sell directly to defendants, to that extent plaintiff's products are not in fair and open competition with other products."

(2) the existence of a fair trade agreement for plaintiff's products established in accordance with the statute, and (3) the sale by defendants of plaintiff's products below the established fair trade prices.

The issues remaining after pretrial were (1) defendants' claim of unlawful discrimination by reason of plaintiff's refusal to deal directly with them (subsequently abandoned); (2) whether there was an abandonment of plaintiff's right to enforce its fair trade price schedule on various individual items by reason of its packaging and offering for resale said items in "tie-in" or "combination" sales; (3) the amount of damages, if any, to which plaintiff is entitled.

After trial, the Chancery Division entered a final judgment which, as far as here pertinent, ...


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