Arsham v. Banci, 74--1673

• Decision Date: 24 February 1975
• Docket Number: No. 74--1673,74--1673
• Citation: 511 F.2d 1108
• Parties: Shiah M. ARSHAM, Plaintiff-Appellant, v. Walter BANCI et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 1108

511 F.2d 1108

Shiah M. ARSHAM, Plaintiff-Appellant, v. Walter BANCI et al., Defendants-Appellees.

No. 74--1673.

United States Court of Appeals Sixth Circuit.

Feb. 24, 1975.

Samuel T. Gaines, Gaines & Stern, Charles Auerbach, Cleveland, Ohio, for plaintiff-appellant.

Avery S. Cohen, Charles M. Rosenberg, Gottfried, Ginsberg, Gurren & Merritt, Cleveland, Ohio, David A. Botwinik, Pavia & Harcourt, New York City, for defendants-appellees.

Before LIVELY, Circuit Judge and McALLISTER and O'SULLIVAN, Senior Circuit Judges.

LIVELY, Circuit Judge.

In this diversity action the plaintiff Arsham sought damages from the defendants (hereafter collectively referred to as Banci) for breach of an alleged oral contract. Banci manufactures textile fabrics in Italy for sale to the clothing industry in the United States and elsewhere. In 1967 Banci's primary outlet for fabrics used in women's sportswear was Russ Togs, and Banci was actively seeking another major customer for such fabrics. Lawrence Pleet, an employee of Banci at the time, suggested Arsham as one who could 'open the door' to Bobbie Brooks, Inc., a major manufacturer of women's sportswear. Arsham was an experienced operator in the field of clothing fabrics who had a close personal and business relationship with Maurice Saltzman, the president of Bobbie Brooks.

Both Arsham and Saltzman were residents of Cleveland, Ohio, the headquarters of Bobbie Brooks. Banci maintained a permanent office in New York City. At Banci's direction, Pleet contacted Arsham and a meeting was arranged between Arsham and Banci. The parties met in the New York office of Banci on June 19, 1967 and it was at this meeting that Arsham claims an oral contract was made. According to Arsham's testimony, Banci told him that he knew of Arsham's relationship with Bobbie Brooks and that he had a proposition that would benefit both of them. The testimony of Arsham continued:

And he proposed selling his line to Bobbie Brooks. And he wanted to know if I could open the door and get started. That were the words he used, could I get him started in there, and I said yes.

Q. Now, prior to that time had you contacted anybody at Bobbie Brooks in an effort to open the door for Banci? A. No, not at all. Before this meeting? No.

A. Now, will you get back to this talk you had with Mr. Banci? You told us that he wanted you to open the door for Banci with Bobbie Brooks. Anything else said at that time? A. Well, I asked him what's in it for me, if I can do this. He said he would give me 5 percent and I agreed with him that my compensation was to be 5 percent of the first year's sales. And I told him at that time that it would take that long before--before that he asked me how long it would be, I said it could be a day, a week, a month, 6 months, a year, but I will certainly finish it before the year is up, and we settled at May 31st. I remember that very clearly.

Q. Now, you settled what as of May 31st? A. Pardon? That our agreement would be finished May 31st, 1968.

Q. And what did that mean to you? A. It means I had a year in which to open the door and I would get 5 percent of the sales written in that year.

Shortly thereafter Arsham met with Maurice Saltzman in Cleveland, told him about Banci's operations and showed him several samples of fabrics which Banci was manufacturing for Russ Togs. Saltzman was interested and turned the matter over to the vice-president of Bobbie Brooks in charge of merchandising. As the result of this meeting, a showing of Banci's fabrics was arranged. This took place in the New York office of Bobbie Brooks. After looking at several suitcases of Banci samples, the designer for Bobbie Brooks stated that his company was not interested because the fabrics 'had too much of a men's look.' Although Banci knew that Bobbie Brooks manufactured only women's wear, about 40% of the samples which he displayed at this meeting in August 1967 were designed for use in men's clothing. Arsham, Banci and Pleet were all present at this showing.

After this rejection, Banci stated that he would return to Italy and 'put together a line more in keeping with what Bobbie Brooks wanted . . ..' According to Arsham he kept in touch with the New York buyer and the merchandising vice-president of Bobbie Brooks and passed along to Banci suggested patterns and colors which Bobbie Brooks wanted Banci to supply. Arsham did not discuss the matter further with Maurice Saltzman or attend any other meetings between Banci and Bobbie Brooks personnel. In December 1967 or January 1968 Banci did display a new line of fabrics to Bobbie Brooks. This line suited the needs of Bobbie Brooks, and substantial orders were placed with Banci for these fabrics.

The testimony of Lawrence Pleet, who was no longer with Banci at the time of the trial, supported that of Arsham. His description of the discussion between Arsham and Banci at the August meeting, and his understanding of their arrangement are contained in the following excerpts from his testimony:

Q. In your presence what did you hear Mr. Banci say to Mr. Arsham, and what did Mr. Arsham say to Mr. Banci? A. Mr. Banci told Mr. Arsham that he wanted to open up the Bobbie Brooks account as quickly as possible. Mr. Arsham agreed to try to do so, felt that he could do so. And Mr. Arsham brought out the fact that although of his friendship--he mentioned the friendship--but he also said due to the business situation in that he was busy, Mr. Saltzman, whom he was going to see, was also busy and he couldn't promise any specific time that he could get to it, get a meeting of the two of them together, but he would do it as fast as humanly possible, make a meeting and find out if Mr. Saltzman would be interested in going further and he would report back.

He said, though, I remember he said he would try to do it as fast as possible, but he didn't pinpoint any particular time. Mr. Banci at that time said, 'Go to it, do the best you can as fast as you can.' And that is where that left.

Mr. Arsham asked him how did he fit into the overall picture if he were successful in doing this, and Mr. Banci told him that he would receive a 5 percent commission for doing this, and that was it. It took a little more time than that, but that was the essence of the meeting.

Q. I am sorry. I forgot a question in terms of the meeting. I am going back now to the meeting when the three of you, Mr. Arsham, Mr. Banci and yourself, and you testified that Mr. Arsham was to act as--would you define for me what it was Mr. Arsham was to do? A. Mr. Arsham merely was to--again in the trade we call it open the door--was to set up the channel for Walter Banci and our organization to have the opportunity to meet with the proper people to display our products. It was a 'a door opening situation.'

Q. And I understand that what you say by door opening, that his responsibility ended at the moment the door opened? A. I don't know whether that is defined as such. Basically someone that opens the door tries to follow it through until the parties get together, and then he steps aside and leaves the work to the two parties.

Q. He was not really to negotiate the transaction? A. That is correct, sir. He was just to get us together and get us with the proper people and get us the opportunity.

Q. And he wouldn't have to service the account in any way? A. No. That is correct. I stated at that meeting. Mr. Arsham stated that he was not in a position to service the account, he had obviously other things that he was working on, and he definitely stated that he was not going to service it at all that his function was to be as I just mentioned.

Banci was not asked to give his version of the meeting of June 19, 1967. His testimony of contacts with Arsham and with Bobbie Brooks is, in pertinent part, set out below:

Q. Did there come a time when you discussed Bobbie Brooks with Mr. Arsham? A. Yes. Mr. Arsham speak to me about Bobbie Brook.

Q. When was this? A. In 1966. And he say that he can get business for me from Bobbie Brook.

Q. Did you have any further conversations with Mr. Arsham about Bobbie Brooks? A. Yes. Several time I say when you put me in business with Bobbie Brook, when I can get my orders. And he reply wait, can't be the moment. Finally one day he came saying that he got the appointment with Bobbie Brook. And I remember that we go together at Bobbie Brook, 1 Park Avenue, and we meet there Mr. Glen Bruce, that this time was the chief stylist of the entire line of Bobbie Brook. And I also meet Marshall.

Q. Now, prior to that meeting did you have any discussion with Mr. Arsham with regard to the compensation he would receive if he obtained orders from Bobbie Brooks or-- A. No, we do not speak about this, because naturally if he got for me sign order from Bobbie Brook, I must to pay commission.

Q. And there was no specific discussion of any percentage as far as you can remember? A. No.

Q. O.K. Now, at that meeting you said you met several people. Did you show a line of goods? A. I showed a 1967 line both for men that came University Mills line made from me, and also the ladies' line, 1967 ladies' line. But Mr. Bruce do not found nothing interesting, and I do not get business.

Q. O.K. Now, did Bobbie Brooks give you any orders arising from the goods which you showed at that meeting? A. No. Absolutely no.

Q. When was your next contact with Bobbie Brooks? A. I remember that at the end of 1967, around December, my mill made a new line that got new revolutionary items, the turbo acrylics. Only America make this time this fabric. And my mill was the second in the entire world, and is very hot items. And every pieces that we can produce we sell immediately.

At this point I say now I got the possibility to get Bobbie Brook account. And I know that in this company we got this time a big buying change. Mr. Maurice Saltzman the president is no more president, and Mr. Adler take his place. Mr. Bruce is no more the stylist, but...