General Box Co. v. Rockaway Corp., PLAINTIFF-APPELLEE
| Decision Date | 19 August 1985 |
| Docket Number | DEFENDANT-APPELLANT,PLAINTIFF-APPELLEE |
| Citation | 772 F.2d 906 |
| Parties | Unpublished Disposition NOTICE: Sixth Circuit Rule 24(c) states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Sixth Circuit. GENERAL BOX COMPANY,, v. ROCKAWAY CORPORATION, NO. 85-3036 |
| Court | U.S. Court of Appeals — Sixth Circuit |
General Box Company (GBC), appellee, commenced this action by filing a complaint on September 27, 1984 alleging a) violations of the Sherman Antitrust Act, 15 U.S.C. Secs. 1 and 2; b) violation of federal patent laws, Title 35, United States Code; and c) violation of the Valentine Act, Chapter 1331 of the Ohio Revised Code, on the part of appellant Rockaway Corporation (Rockaway).
On November 1, 1984 Rockaway filed lawsuits in the state courts of Michigan, Mississippi, North Carolina, Texas and Wiconsin seeking to replevin machinery rented by GBC. Rockaway's state lawsuits sought repossession of machinery allegedly licensed and leased to GBC and unlawfully retained by GBC in violation of contract. On November 9, 1984 GBC removed each of the state court actions to the respective federal courts in those jurisdictions.
On that same date, GBC filed a motion for a temporary restraining order, preliminary injunction, and permanent injunction. GBC sought injunctive relief prohibiting Rockaway from proceeding with the replevin actions. After a hearing, the United States District Court for the Northern District of Ohio, Western Division, granted GBC's application for a temporary restraining order. The court subsequently heard GBC's motion for a preliminary injunction. On December 6 the district court granted the preliminary injunction restraining Rockaway from instituting suit against GBC for replevin or any other action regarding the machinery in other courts. The court also ordered GBC to post a $5,000.00 bond and did not require GBC to make any rental payments for the use of Rockaway's wire-bound box machinery pending a final determination on the merits.
Rockaway filed its notice of appeal challenging the grant of extraordinary relief and the alleged inadequacy of the bond requirements. Rockaway then filed a motion with the trial court for an order requiring plaintiff to resume rental payments for the use of defendant's machinery and to make an accounting of the use made of the machinery during the pendency of its appeal. 1
The trial judge held that Rockaway's notice of appeal had divested it of jurisdiction to consider defendant's motion, but added:
The Court does not look with favor upon defendant's [Rockaway's] motion. The Court has already considered the arguments made therein in determining the terms of the injunctive order.
GBC contends that the court's December 6 order extending the temporary restraining order into a preliminary injunction merely barred appellant Rockaway from pursuing any replevin-like relief in other courts. Rockaway, on the other hand, appeals primarily on the grounds that the effect of the order was to bar any replevin-like relief or adequate bond security.
In oral argument before this court Rockaway contended that it loses approximately $200,000 every six month rental period that GBC fails to remit these contract royalty or lease payments due under the agreement. GBC concedes in its brief that it attained over $10,000,000 in gross sales subject to the agreement in 1983, the last full year in which it furnished reports and paid royalties.
The contract between the parties covered a twenty-five year term beginning in 1977. The agreement was based on rent or royalty ranging between 4% or 2% of GBC's gross box sales depending on the particular Rockaway machinery used. GBC claims that the present lease represents an extension of the original lease initiated between the parties, or their predecessors, in 1946. At that time Rockaway had certain patent rights on the machinery which allegedly expired prior to 1971, the renewal date. 2 Asserting that Rockaway is the sole manufacturer of wirehound box-making machines in the United States, GBC claims that Rockaway engages in illegal monopoly activity through enforcement of the lease. GBC emphasizes this alleged monopolization as the reason why it ceased making any further lease payments or furnishing sales reports in April and June, 1984, respectively. On August 31, 1984, Rockaway notified GBC that the agreement would be cancelled unless GBC cured its breach by making the payments due. GBC then initiated this suit challenging the lease as part of an unlawful monopoly.
GBC demands treble damages and a declaratory judgment that it is the lawful owner of all wire-bound box-making machinery currently in its possession. GBC has continued for more than a year to utilize the machinery subject to the challenged lease or license agreement without making any payment. It has also been required to post only a $5,000 bond to...
To continue reading
Request your trial