Fiat Motor Company v. Alabama Imported Cars, Inc.
| Citation | 110 US App. DC 252,292 F.2d 745 |
| Decision Date | 25 May 1961 |
| Docket Number | No. 15606.,15606. |
| Parties | FIAT MOTOR COMPANY, Inc., Appellant, v. ALABAMA IMPORTED CARS, INC., Appellee. |
| Court | United States Courts of Appeals. United States Court of Appeals (District of Columbia) |
Mr. Edward Garfield, of the bar of the Court of Appeals of New York, New York City, pro hac vice, by special leave of court, with whom Mr. Malcolm S. Langford, Washington, D. C., was on the brief, for appellant.
Mr. John F. Mahoney, Jr., Washington, D. C., with whom Messrs. Charles E. Pledger, Jr., and Justin L. Edgerton, Washington, D. C., were on the brief, for appellee.
Before WILBUR K. MILLER, Chief Judge, and BAZELON and BURGER, Circuit Judges.
Appellant (Fiat) is a New York corporation with its principal place of business in New York City. It imports Fiat automobiles and sells them to wholesale distributors, among which is the Roosevelt Automobile Company (Roosevelt), a Delaware corporation with its principal place of business in the District of Columbia. The appellee, Alabama Imported Cars, Inc. (Alabama) is an Alabama corporation and a dealer under a sales agreement. Appellee instituted this suit under the Automobile Dealers' Franchise Act, 15 U.S.C.A. §§ 1221-1225, against Fiat and Roosevelt as co-defendants and purported to accomplish service on Fiat by service upon the president of Roosevelt in the District. Fiat's motion to quash service was denied and this appeal from the interlocutory order was certified under 28 U.S.C. § 1292(b) (1958).
The lengthy "Distributor Sales Agreement" to which Fiat and Roosevelt are parties provides that Roosevelt is an authorized distributor of Fiat motor vehicles, parts and equipment for the District of Columbia and nine southeastern states.1 Roosevelt is obligated under the agreement to promote the sales of Fiat products vigorously and aggressively, to use advertising materials2 provided by Fiat, to establish and equip "to the satisfaction of Fiat" places of business in the District of Columbia and Florida, to maintain those locations in good condition, and to change such locations only with the prior consent of Fiat. The contract also requires Roosevelt to keep and furnish to Fiat upon request, such records and reports as Fiat shall require, to maintain certain stated working capital and net worth, to employ personnel in certain stated capacities and to insure their attendance at Fiat training schools. Particularly significant in view of the issue in this litigation is Fiat's express power over Roosevelt's designation of local Fiat dealers in the area.
These and other provisions of the agreement manifest a continuing business relationship involving the supervision and control by Fiat of numerous details of the Roosevelt business. The theory of appellee's complaint is that Roosevelt and Fiat, through their control over dealerships, did not afford appellee's franchise the good faith treatment required by the Dealers' Act under which suit is brought. Thus, the cause of action upon which the suit is based arises from the relationship between Fiat and Roosevelt and provisions of their agreement. In our view this relationship subjects Fiat to service in the District whether that issue is considered to be governed by federal or local standards.3
Assuming that in the absence of controlling federal statute4 the matter is governed by the standards of "fair play and substantial justice,"5 Lone Star Package Car Co. v. Baltimore & O. R. Co., 5 Cir., 1954, 212 F.2d 147, the contacts of Fiat with the District are of such substantial, continuing, and directory nature as to warrant the holding that it is doing business here in a manner which makes it subject to service of process in this jurisdiction. McGee v. International Life Ins. Co., 1957, 355 U.S. 220, 78 S.Ct. 199, 2 L.Ed.2d 223; Florio v. Powder Power Tool Corp., 3 Cir., 1957, 248 F.2d 367; cf. Scholnik v. National Airlines, Inc., 6 Cir., 1955, 219 F.2d 115. On the other hand, if local law governs, Fiat is subject to service in the District under our decision in Carroll Electric Co. v. Freed-Eisemann Radio Corp., 1931, 60 App.D.C. 228, 50 F.2d 993. See also Frene v. Louisville Cement Co., 1943, 77 U.S.App.D.C. 129, 134 F.2d 511, 146 A.L.R. 926.
Appellant contends that even if it is subject to service in the District, service...
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