FEDERAL GLASS COMPANY v. Loshin

• Decision Date: 03 December 1954
• Docket Number: No. 23226.,23226.
• Citation: 217 F.2d 936
• Parties: FEDERAL GLASS COMPANY, Appellant, v. Samuel LOSHIN, et al., Appellees.
• Court: U.S. Court of Appeals — Second Circuit

217 F.2d 936 (1954)

FEDERAL GLASS COMPANY, Appellant, v. Samuel LOSHIN, et al., Appellees.

No. 23226.

United States Court of Appeals, Second Circuit.

Motion Submitted October 4, 1954.

Decided December 3, 1954.

Irving Levine, Danbury, Conn., for the motion.

Wiggin and Dana, New Haven, Conn., and Corbett, Mahoney & Miller, Columbus, Ohio (Thew Wright, Jr., New Haven, Conn., of counsel), for appellant.

Before CLARK, Chief Judge, and L. HAND and FRANK, Circuit Judges.

L. HAND, Circuit Judge.

The defendants move to dismiss an appeal, taken by the plaintiff from an order that denied its motion for a summary judgment in an action to enjoin the defendants (a) from copying the plaintiff's trade name and corporate title, (b) to compel them to account for any profits, and (c) to pay damages. (The complaint included a prayer both for a permanent injunction and for an injunction pendente lite). The plaintiff's motion came on to be heard after answer upon numerous affidavits filed by both parties, and upon the plaintiff's answers to interrogatories put by the defendants. Judge Smith denied it in a written opinion, 126 F.Supp. 737, substantially for the reason that the plaintiff had not proved that its trade name had become widely enough known in the defendants' market before the defendants had themselves begun business. Both parties agree that the order was interlocutory; their difference is whether it is nevertheless within the meaning of § 1292(1) of Title 28 U.S.C.A., as an order "refusing" an injunction. The decisions are not uniform. We held in Raylite Electric Corp. v. Noma Electric Corporation, 2 Cir., 170 F.2d 914, that an appeal lay from such an order, and the Fifth Circuit did the same in International Forwarding Co. v. Brewer, 181 F.2d 49. On the other hand the Third Circuit in Morgenstern Chemical Co. v. Schering Corp., 181 F.2d 160, examined the question with much learning and dismissed the appeal, and it has followed that decision in a later case, Hook v. Hook & Ackerman, Inc., 213 F.2d 122; and Mr. Moore accepts their view.¹ We agree that, as Judge Hastie said in Morgenstern Chemical Co. v. Schering Corp., supra 181 F.2d 161, our decision was made "without analysis of the problem"; owing to the fact that we mistakenly thought that the question did not demand analysis.

Section 1291 provides for appeals from final judgments of all sorts, necessarily including an appeal from a final judgment denying a permanent injunction. Section 1292 allows appeals from four different kinds of interlocutory orders, of which the first is those "granting, continuing, modifying, refusing or dissolving injunctions, or refusing to dissolve or modify injunctions." If these words be read literally, they appear to us indubitably to cover the denial of a motion for a permanent injunction, regardless of what may be the procedure or grounds of the moving party. Indeed, we do not understand that those, who deny any appeal, think otherwise; they base their interpretation upon the theory that the decision does not settle, and indeed does not even tentatively decide, anything about the merits of the claim; all it does is to hold that, upon the facts as shown, the cause must await a trial. Even were that so, it scarcely seems an adequate reason for disregarding language so unconditional as that of the section; but we do not wish to rely upon that. Under Rule 56(c), 28 U.S.C.A., to be granted a summary judgment, the moving party must show, not only that there is no "genuine issue as to any material fact," but also that he "is entitled to a judgment as a matter of law." If the decision is based upon these later words, it is obvious that a denial may finally settle a great deal, for usually a later judge will accept the law already laid down in the same action by an earlier judge. Moreover, to reach such a decision the "discretion of the chancellor" may be "invoked"; "equitable considerations" may be "weighed"; or the "conclusion" may be "reached with respect to the equity of the claim that a restraint should be imposed." But, even when the denial is because there is a "genuine issue as to any material fact," the decision is not confined to deciding that the claim must await a trial, although that of course is one of its results. Subdivision (c) requires the judge to pass upon "the pleadings, depositions, and admissions on file, together with the affidavits"; and subdivisions (d) and (e) not only provide that the affidavits on both sides "shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein"; but also that so far as may be possible all facts shall be decided even though the motion be denied. We cannot escape the belief that the decision involves much more than that it will be better to await a trial; and this is borne out by a substantial body of decision that the question is the same as that raised by a motion to direct a verdict in an action tried to a jury.² For example, in Sartor v. Arkansas Natural Gas Corp., 321 U.S. 620, 624, 64 S.Ct. 724, 727, 88 L.Ed. 967, the Supreme Court said: "But at least a summary disposition of issues of damage should be on evidence which a jury would not be at liberty to disbelieve and which would require a directed verdict for the moving party."

It is of course true that the motion is not a substitute for a trial, against the possibility of which courts — ourselves especially — have been solicitous to protest. There always remains the high hurdle over which the plaintiff must leap, who would secure such a judgment: i. e. the record, as it comes before the court, is of necessity limited to evidence that can be put into writing or contained in exhibits; and, as we have never tired of saying, what is left out may be, and frequently is, the most important part. Besides, at least in actions triable to a jury, the handicap is greater even than this; for the court must refuse to decide any issues whose answer admits of reasonable doubt. Therefore, to say, even though the denial has been because there was a "genuine issue of fact," that nothing is decided, and that nothing can be settled, appears to us an untenable generalization. That everything is not decided is certainly no objection, else denials of preliminary injunctions would also be excluded, and § 1292(1) would be altogether nullified.

Finally, although a preliminary injunction gives the plaintiff relief until the trial, it insures him of nothing more, and he cannot arrange his affairs upon the basis of any protection after the trial. That uncertainty, which may last over a year, may be nearly as serious as the absence of any protection at all. It appears to us therefore that the considerations that presumably moved Congress in 1895³ to grant appeals from interlocutory denials of preliminary injunctions — i. e. because it was unfair to leave suitors unprotected pending trial — should be deemed to apply to denials of permanent injunctions. The original omission of any mention of these is readily accounted for by the fact that it was not until 1938, when the New Rules went into effect, that it was possible to move for summary judgment in a Federal Court. Although we are impressed by the high authority of those who take the opposite view, we are not persuaded that we should change our original ruling; and the motion will be denied.

Motion denied.

FRANK, Circuit Judge (concurring).

1. Plaintiff's complaint prayed both a preliminary and a final injunction. Its motion sought the relief which it asked in its complaint. When a plaintiff, without seeking summary judgment, makes a motion for preliminary injunction, if the judge refuses to grant it, because he considers insufficient affidavits offered by plaintiff, an appeal of course lies under 28 U.S.C. § 1292. I think there should be no different conclusion merely because plaintiff seeks the preliminary injunction by means of a paper which plaintiff calls a motion for summary judgment.

A contrary conclusion, by sheer ritualism, would waste time. For plaintiff, the next minute after the denial of the summary judgment motion, could present the same papers unchanged except for a new label, "Motion for a preliminary injunction." For that reason, I disagree with Morgenstern Chemical Co. v. Schering Corp., 3 Cir., 181 F.2d 160, where the court said at page 162: "Nothing has occurred in or as a result of the denial of the motion for summary judgment which precludes plaintiff from seeking a temporary injunction in accordance with established procedure if he believes immediate injunctive relief is necessary and proper."

2. Ordinarily an order denying a summary judgment is not appealable. It is suggested that the consequence of our ruling here will mean that, if only a plaintiff includes in his complaint a prayer for a preliminary injunction, any order denying a summary judgment will become appealable, and that thus the courts of appeal will be faced with many frivolous appeals. But many an appeal from a denial of a motion, explicitly labeled a motion for preliminary injunction, is frivolous — because of the trial judge's wide discretion in such matter — and receives short shrift when the appeal is heard on the merits.

3. The case for appealability here, even as to the denial of a final injunction, is peculiarly strong and exceptional. For the judge did not...