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CROWN TRAVEL SERV. v. AIR TRAFFIC CONF. OF AMERICA

June 29, 1967

CROWN TRAVEL SERVICE, INC., Plaintiff,
v.
AIR TRAFFIC CONFERENCE OF AMERICA, a DIVISION OF AIR TRANSPORT ASSOCIATION (consisting of more than 7 members), and United Air Lines, Defendants



The opinion of the court was delivered by: WORTENDYKE

 WORTENDYKE, District Judge:

 This action was instituted in the Chancery Division of the New Jersey Superior Court and removed to this Court upon jurisdictional grounds. On May 10, 1967, the Honorable Robert A. Matthews, Judge of the Superior Court of New Jersey, Chancery Division, issued an ex parte temporary restraining order against the defendants requiring the return of ticket-issuing paraphernalia to the plaintiff, and after oral argument was heard on May 15, 1967, granted an interlocutory injunction. On May 23, 1967, the defendants filed a petition to remove this case to this Court and moved for summary judgment, or in the alternative, made application to dissolve the interlocutory injunction ordered by the State Court.

 Based upon the pleadings, affidavits and briefs filed, together with the oral argument before this Court, I make the following findings of fact:

 1. In 1965, the plaintiff, Crown Travel Service, Inc., entered into a valid sales agency contract with the defendant, Air Traffic Conference of America, an organization composed of domestic airlines, by which it was permitted to issue tickets of the member airlines to the public.

 2. Paragraph 26 of this agreement provides:

 
"26. Subject to Carrier's Obligations, etc. under Air Traffic Conference Agency Resolution:

 3. Section VII.C of the Air Traffic Conference Resolution 80.10, which governs late remittances by travel agents for tickets issued, is by virtue of Paragraph 26 a part of the contract signed by the plaintiff travel agent. The provisions of this section were approved by the Civil Aeronautics Board on April 24, 1964 (Order No. E-20741) and on October 8, 1964 (Order No. E-21380). This section provides:

 
"16. Section VII.C, of Resolution 80.10 is amended to read:
 
"C.1. If the sales report and/or remittance due from any agent is not transmitted to the designated area bank as required by Paragraph 5 of the Sales Agency Agreement, the Executive Secretary shall, on being notified of such delinquency, immediately send to such Agent by certified or registered mail, return receipt requested, a letter in the form prescribed from time to time by the Agency Committee.
 
2. The Executive Secretary shall maintain, for each report period, a list of the names and addresses of all Agents (a) to whom such letters, not afterwards rescinded, were sent, or (b) whose remittance check was dishonored by the drawee bank. A copy of such list shall be sent to each member following the close of the period.
 
3. If the name of any Agent appears on such lists four times during any twelve consecutive months (for which purpose a dishonored check shall count as two such appearances), the Executive Secretary shall promptly so notify all members, the Agent, and the Secretary-AFAC, who shall promptly withdraw all ticket forms and exchange orders supplied by him to such Agent, and all airline identification (platess) supplied by members to such Agent, and each member who has appointed such Agent shall, within fourteen days of notice from the Executive Secretary, revoke any authorization previously given to such agent to draw its own exchange orders on such members.
 
4. The Secretary-AFAC shall not thereafter provide such Agent with supplies of ticket forms or exchange orders, and no member shall thereafter supply such Agent with its airline identification (platess) or authorize such Agent to draw its own exchange orders on such member, until after the date on which the Executive Secretary mails a notice to ...

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