Bulova Watch Co. v. Anderson

• Decision Date: 03 May 1955
• Citation: 270 Wis. 21,70 N.W.2d 243
• Parties: BULOVA WATCH CO., Inc., a New York Corporation, Appellant, v. Arthur L. ANDERSON, Respondent.
• Court: Wisconsin Supreme Court

Page 243

70 N.W.2d 243

270 Wis. 21

BULOVA WATCH CO., Inc., a New York Corporation, Appellant, v. Arthur L. ANDERSON, Respondent.

Supreme Court of Wisconsin.

May 3, 1955.

Suit by plaintiff Bulova Watch Company, Inc., against the defendant Arthur L. Anderson to enjoin and restrain him from selling Bulova watches at prices less than established by plaintiff under section 133.25, Stats., the Wisconsin Fair Trade Act.

The pertinent provisions of plaintiff's amended complaint are as follows:

'1. That the plaintiff is a New York Corporation, engaged in the business of manufacturing and selling watches and other time-keeping devices, with its principal office at 630 Fifth Avenue, in the Borough of Manhattan, City and State of New York; that said plaintiff is a foreign corporation, not licensed to do business in the State of Wisconsin, and engaged in interstate commerce.

'2. That the defendant, Arthur L. Anderson, is engaged in the jewelry business with his place of business at 135 West Wells Street, Milwaukee, Wisconsin.

'3. That on or about August 15, 1952, plaintiff entered into an Agreement with one, Steller's Inc., a retailer, doing business in Milwaukee, Wisconsin, pursuant to Section 133.25 of the Wisconsin Statutes (Fair Trade Act of the State of Wisconsin) whereby certain prices were listed as the stipulated retail resale prices for all products manufactured by plaintiff. That said Agreement is made a part hereof by reference and a copy is attached hereto marked Exhibit 'A' and made a part hereof as though fully set forth in said complaint.

'4. That on or about June 30, 1953, plaintiff caused to be sent to defendant by registered mail, a true and correct copy of the Wisconsin Fair Trade Agreement or Contract with Steller's Inc., which Contract included a certain retail price list setting forth the minimum resale price or minimum price to consumers of commodities produced, manufactured and distributed by Bulova Watch Company, Inc., plaintiff herein. That a copy of said Retail Price List is also attached hereto and made a part hereof as though fully set forth herein and is marked Exhibit 'B'.

'5. That upon information and belief, defendant has subsequent to July 2, 1953, the date noted on the Return Receipt of the Registered Mail referred to in the 4th paragraph of this complaint, sold a Bulova 'Commutor' Model Watch, Serial 6719675, for $55.00, whereas the retail price stipulated in the aforesaid Fair Trade Agreement of which defendant had notice was $71.50 and as set forth in the Retail Price List mentioned in said 4th paragraph of this complaint.

'6. That if said defendant is not prevented from engaging in the sale of Bulova Watches below the aforesaid stipulated prices, and is not prevented from making such sales, irreparable injury will be caused to plaintiff for which the remedy of money damages will be inadequate.'

Exhibit 'A' attached to the complaint and incorporated therein by reference consisted of an agreement entered into between the plaintiff corporation and Steller's, Inc., whereby the latter was appointed an authorized distributor for the sale of plaintiff's products at retail at its place of business in the city of Milwaukee for a specified period; and, Steller's, Inc., agreed 'not to sell, offer for sale, or advertise for sale' products of the plaintiff at prices less than those set forth in plaintiff's retail price list.

The defendant Anderson demurred to the amended complaint on the following grounds:

'That the same does not state facts sufficient to constitute a cause of action.

'That the plaintiff has not legal capacity to sue; as it appears therefrom that the plaintiff is not licensed to do business in the State of Wisconsin and is a foreign corporation.

'That the Fair Trade Act of Wisconsin is unconstitutional and the violation of the Fourteenth Amendment of the United States Constitution.'

The demurrer was sustained by order entered under date of September 29, 1954, on the ground that plaintiff did not have legal capacity to sue. From such order sustaining the demurrer plaintiff has appealed to this court.

Rice & Ramsey, Milwaukee, Richard M. Rice, Milwaukee, of counsel, for appellant.

Paul E. Bornemann, Milwaukee, for respondent.

CURRIE, Justice.

The sole reason which was assigned by the learned trial judge for his sustaining of the demurrer was his conclusion that the plaintiff foreign corporation lacked capacity to sue under section 180.847, Stats. Sub. (1) of such statute provides as follows:

'No foreign corporation transacting business or acquiring, holding or disposing of property in this state without a certificate of authority, if a certificate of authority is required under this chapter, shall be permitted to maintain or defend a civil action or special proceeding in any court of this state, until such corporation shall have obtained a certificate of authority.'

Section 180.801, Stats., provides that a foreign corporation shall procure a certificate of authority from the secretary of state before it shall transact business in the state, but certain listed activities are excluded from such requirement. None of the exceptions of such statute are applicable to the facts of the instant case. However, SECTION 180.849, STATS¹., makes it clear that the mere institution of suit by the plaintiff is not an act which constitutes the transacting of business within the state and examination of the allegations of the complaint discloses that the plaintiff does not allege that it performed any act within the state of Wisconsin.

The 'fair trade' contract entered into between plaintiff and Steller's, Inc., constituting exhibit 'A' of the complaint, is entirely silent as to whether such contract was executed within or without the state. If the making of such contract was incidental to the sale and shipment of plaintiff's products in interstate commerce, such transaction would be exempt from the requirement of section 180.801, Stats., under the decisions of this court in Standard Sewing Equip. Corp. v. Motor Specialty, 1953, 263 Wis. 467, 57 N.W.2d 706; Charles A. Stickney Co. v. Lynch, 1916, 163 Wis. 353, 158 N.W. 85; and Jerome P. Parker-Harris Co. v. Kissel Motor Car Co., 1917, 165 Wis. 518, 163 N.W. 141. Furthermore, even if the contract were not incidental to interstate commerce, there is no presumption that it was made in Wisconsin, because if there is any inference to be drawn as to the place of making the contract it is that plaintiff would not violate the law by transacting business within the state without first obtaining a certificate of authority. Standard Sewing Equip. Corp. v. Motor Specialty supra, 263 Wis. at page 475, 57 N.W.2d 706.

Counsel for the defendant contends that the performance of the contract between Steller's, Inc., and plaintiff, requiring as it does sales of merchandise in Wisconsin at prices set by plaintiff pursuant to such contract so as to gain for the plaintiff the benefit of the provisions of the Wisconsin Fair Trade Act, constitutes the transacting of business within the state by plaintiff. In support of such contention, counsel cites syllabus 1 of Weco Products Co. v. Reed Drug Co., 1937, 225 Wis. 474, 274 N.W. 426, wherein it is stated:

'* * * and the contract in issue, being by express provision therein applicable only to transactions consummated in the state of Wisconsin and not elsewhere, did not affect interstate commerce, and, therefore, did not violate the Federal Anti-Trust Laws.'

The transactions referred to in the foregoing quotation were the sales by a Wisconsin retailer of goods whose prices had been fixed pursuant to a 'fair trade' contract, and not the original sale of the goods from the out-of-state manufacturer to the retailer. In the instant complaint there is no allegation that either Steller's, Inc., or the defendant, in selling Bulova watches in Wisconsin was acting as agent of the plaintiff foreign corporation. Without such an allegation of agency, the sales made at retail by either Steller's, Inc., or the defendant, would not constitute the transacting of business within the state by the plaintiff. Heinrich Chemical Co. v. Herman, Mo.App., 1923, 251...