Mytinger & Casselberry, Inc. v. Numanna Lab. Corp.

• Decision Date: 23 August 1954
• Docket Number: No. 11092.,11092.
• Parties: MYTINGER & CASSELBERRY, Inc. v. NUMANNA LABORATORIES CORP. et al.
• Court: U.S. Court of Appeals — Seventh Circuit

215 F.2d 382 (1954)

MYTINGER & CASSELBERRY, Inc. v. NUMANNA LABORATORIES CORP. et al.

No. 11092.

United States Court of Appeals, Seventh Circuit.

August 23, 1954.

Ray T. McCann, Milwaukee, Wis., Leonard S. Kleinfeld, Lester Mehlman, Chicago, Ill., W. L. Gold, Milwaukee, Wis., for appellants.

Gerald P. Hayes, John A. Kluwin, Milwaukee, Wis., J. E. Simpson, Los Angeles, Cal., Charles S. Rhyne, Brice W. Rhyne, Eugene F. Mullin, Jr., J. Parker Connor, Washington, D. C., for appellee.

Before MAJOR, Chief Judge, and LINDLEY and SCHNACKENBERG, Circuit Judges.

MAJOR, Chief Judge.

Plaintiff, a California corporation, is engaged in the distribution of a product known as Nutrilite Food Supplement. Its business is conducted through individual distributors who sell plaintiff's product either directly to the public or to other distributors who in turn do so. The defendant corporation is licensed to do business in Wisconsin and is engaged in competition with the plaintiff, with the distribution of a food product known as Numanna Food Supplement. Its home office is at Lake Geneva, Wisconsin. The defendant corporation, like plaintiff, sells its product to distributors who sell directly to the public. Nine individuals, distributors of the defendant corporation and former distributors of plaintiff, are named as defendants.

On November 25, 1953, plaintiff filed its verified complaint charging that the defendants maliciously and with intent to injure plaintiff, conspired together in a continuing systematic and concerted endeavor, marked by false and malicious statements and high pressure tactics to induce the distributors of plaintiff's product to terminate their relationship with plaintiff and to violate their contract with plaintiff by, among other things, soliciting customers of plaintiff's product to cease using plaintiff's product and to commence using that of the corporate defendant, all for the purposes of interfering with and destroying plaintiff's contractual relations with its distributors and diverting the good will pertaining to plaintiff's product to that of the corporate defendant. The complaint discloses that as of the time it was filed defendants' activities had brought about in the State of Wisconsin alone the defection of more than one hundred and fifty of plaintiff's distributors and of more than one thousand customers, and that injury, loss and damage in the amount of $50,000 had already been sustained. This injury, loss and damage was sustained, according to the allegations, in the period of time between September 16 and November 23, 1953.

The complaint, in summary, sets forth that the defendants entered into a conspiracy to induce plaintiff's distributors to violate their contractual relations with plaintiff and by unfair competition and unfair trade practices to interfere with and destroy plaintiff's business. It prayed that defendants be restrained and enjoined, both preliminarily pending suit and permanently at the final hearing, from a continuation of their alleged unlawful and improper activities, and joint and several judgments were sought against defendants and each of them in the amount of $50,000, and punitive and exemplary damages in the amount of $100,000. On the filing of the complaint, a temporary restraining order was entered against the individual defendants. Thereafter, some of the defendants filed answers denying the material allegations of the complaint and that plaintiff was entitled to the relief sought. A number of affidavits were filed by the plaintiff in support of its complaint and also by the defendants in support of the denials contained in their answers. On December 4, 1953, the court heard oral argument on plaintiff's motion for a preliminary injunction and three days later heard oral testimony of witnesses called in support of the contentions advanced by the respective parties. Predicated upon the pleadings, affidavits, oral arguments, as well as written briefs and the oral testimony of witnesses, the court, on December 9, 1953, entered findings of fact and conclusions of law on plaintiff's motion for a preliminary injunction. On the same day, a decree for a preliminary injunction was entered. From this decree defendants appeal to this court.

Defendants, apparently ignoring this court's limited scope of review on appeal from a preliminary injunction decree, proceed, mistakenly we think, to argue the case as though it were here on appeal from a final decree upon the merits. The sole issue before this court is whether the District Court abused its discretion in allowing the preliminary injunction, and this court is not authorized to reverse or modify such a decree unless such abuse is clearly shown. Citation of a few of the many cases to this effect will suffice. Mitchell v. Penny Stores, 284 U.S. 576, 52 S.Ct. 27, 76 L. Ed. 500; State of Alabama v. United States, 279 U.S. 229, 231, 49 S.Ct. 266, 73 L.Ed. 675; Corporation Commission of State of Oklahoma v. Cary, 296 U.S. 452, 458, 56 S.Ct. 300, 80 L.Ed. 324; National Fire Insurance Co. of Hartford v. Thompson, 281 U.S. 331, 338, 50 S.Ct. 288, 74 L.Ed. 881; Ohio Oil Co. v. Conway, 279 U.S. 813, 815, 49 S.Ct. 256, 73 L.Ed. 972.

The last named case cited with approval the opinion of Love v. Atchison, T. & S. F. R. Co., 8 Cir., 185 F. 321 at page 331, where the court stated: "An appeal from an order granting or refusing an interlocutory injunction does not invoke the judicial discretion of the appellate court. The...