Gordon v. Loew's Incorporated, Civ. A. No. 202-55

• Decision Date: 14 December 1956
• Docket Number: Civ. A. No. 202-55,203-55,204-55.
• Citation: 147 F. Supp. 398
• Parties: Frank L. GORDON and Marion V. Gordon, Plaintiffs, v. LOEW'S INCORPORATED, a Delaware corporation; Paramount Film Distributing Corporation, a Delaware corporation; Paramount Pictures, Inc., a New York corporation; RKO Radio Pictures, Inc., a Delaware corporation; Twentieth Century-Fox Film Corporation, a New York corporation; Twentieth Century-Fox Film Corporation, a Delaware corporation; Warner Bros. Pictures Distributing Corporation, a New York corporation; Columbia Pictures Corporation, a New York corporation; Universal Film Exchanges, Inc., a Delaware corporation; and United Artists Corporation, a Delaware corporation, Defendants. Francis J. CURTIS, Trustee in Bankruptcy of B.P.R. Corporation, an Illinois corporation, Plaintiff, v. LOEW'S INCORPORATED, etc., et al., Defendants. John C. GORDON, Helen Gordon, and Joseph Gordon, Plaintiffs, v. LOEW'S INCORPORATED, etc., et al., Defendants.
• Court: U.S. District Court — District of New Jersey

147 F. Supp. 398

Frank L. GORDON and Marion V. Gordon, Plaintiffs, v. LOEW'S INCORPORATED, a Delaware corporation; Paramount Film Distributing Corporation, a Delaware corporation; Paramount Pictures, Inc., a New York corporation; RKO Radio Pictures, Inc., a Delaware corporation; Twentieth Century-Fox Film Corporation, a New York corporation; Twentieth Century-Fox Film Corporation, a Delaware corporation; Warner Bros. Pictures Distributing Corporation, a New York corporation; Columbia Pictures Corporation, a New York corporation; Universal Film Exchanges, Inc., a Delaware corporation; and United Artists Corporation, a Delaware corporation, Defendants.

Francis J. CURTIS, Trustee in Bankruptcy of B.P.R. Corporation, an Illinois corporation, Plaintiff, v. LOEW'S INCORPORATED, etc., et al., Defendants.

John C. GORDON, Helen Gordon, and Joseph Gordon, Plaintiffs, v. LOEW'S INCORPORATED, etc., et al., Defendants.

Civ. A. Nos. 202-55, 203-55, 204-55.

United States District Court D. New Jersey.

December 14, 1956.

COPYRIGHT MATERIAL OMITTED

Stein, Stein & Engel, Jersey City, N. J., for plaintiffs, by Richard M. Orlikoff, Chicago, Ill.

Toner, Crowley, Woelper & Vanderbilt, Newark, N. J., for defendants, by Willard G. Woelper, Newark, N. J.

Dwight, Royall, Harris, Koegel & Caskey, New York City, for Twentieth Century-Fox Film Corp., by Stanley Godofsky, New York City.

Philip J. O'Brien, Jr., New York City, for RKO Teleradio Pictures, Inc.

Marvin H. Ginsky, New York City, for Paramount Film Distributing Corp.

WORTENDYKE, District Judge.

Each of these cases is an action for treble damages under Section 4 of the Clayton Act, 15 U.S.C.A. § 15. In No. 202-55, the plaintiffs are alleged to have been the holders of all of the outstanding stock of The Northwest Theater Company, a corporation organized under the laws of Illinois, which had operated the Wicker Park motion picture theater in Chicago from April 15, 1929 to May 14, 1949, but which was dissolved on February 16, 1950. The plaintiffs in No. 204-55 claim to have been owners of all the stock of another Illinois corporation, known as Gordon Brothers Theater Company, which operated another motion picture theater (Chopin Theater) from September 1, 1922 to January 1, 1947, in Chicago, and which was dissolved on January 25, 1949. Civil action No. 203-55 is brought by the Trustee in Bankruptcy of B. P. R. Corporation, a body corporate of the State of Illinois, which had been the lessee and operator of three motion picture theaters in Chicago for periods of time between March 1, 1944 and June 10, 1951. Defendants in all three actions were originally the same.

Paramount Pictures, Inc. and Paramount Film Distributing Corporation (hereinafter respectively referred to as Paramount Pictures and Paramount Film), Warner Bros. Picture Distributing Corporation (hereinafter referred to as Warner), RKO Radio Pictures Inc. (hereinafter referred to as RKO), Twentieth Century-Fox Film Corp. (N.Y.) and Twentieth Century-Fox Film Corp. (Delaware) (hereinafter respectively referred to as Fox-N.Y. and Fox-Del.), Loew's Incorporated (hereinafter referred to as Loew's), Columbia Pictures Corp. (hereinafter referred to as Columbia), and Universal Film Exchanges, Inc. (hereinafter referred to as Universal), are charged as distributors and producers of motion pictures, while United Artists Corp. (hereinafter referred to as U.A.), is charged as a distributor thereof. These defendants are collectively referred to in each complaint as "defendant distributors". It is also alleged that Paramount Pictures was dissolved January 1, 1950 and that its production and distribution facilities were transferred to Paramount Film, which is accordingly charged as a successor corporation to Paramount Pictures. Similarly, Fox-N.Y. is alleged to have been dissolved in September 1952, and the complaint charges that its production and distribution facilities were transferred to Fox-Del., which is charged as a successor corporation to Fox-N.Y. Four other corporations, viz. Balaban & Katz Corp., Warner Bros. Theaters, Inc., Warner Bros. Circuit Management Corp. and Essaness Theaters Corporation, although not made parties defendant to any of these actions, are alleged in the complaint in each to have been co-conspirators with the named defendants.

In cases numbered 202-55 and 204-55 (hereinafter referred to as the Gordon cases), the relationship of the plaintiffs to the causes of action which are alleged to have accrued to the respective nowdissolved theater corporations in which they were stockholders is set forth in each complaint in the following language:

"By reason of the unlawful acts of defendants herein complained of," (the dissolved theater corporation) "and the plaintiffs were subject to great loss and damage during the period from" (January 1, 1935 to May 14, 1949 in C-202-55, and January 1, 1935 to January 1, 1947 in C-204-55) "both in loss of revenue from the operation of" (named theater) "and in the diminution of the value of the leasehold interest which" (the theater company held in the premises) "and in the diminution of the value of other capital assets of" (the theater company). "Plaintiffs are unable to determine the full extent of the loss of revenue suffered by" (the theater company) "and themselves at the present time, but plaintiffs will be able to ascertain such damage after an examination of the books and records of the defendants and their co-conspirators. Plaintiffs are entitled, under the laws of the United States, to recover from the defendants threefold the actual damage suffered by them."

The corresponding allegations of the complaint in C-203-55 (the case brought by Curtis, Trustee) charge that, by reason of the unlawful acts complained of, the bankrupt corporation suffered damage from March 1, 1944 to June 10, 1951 in loss of revenue from the operation of the three theaters which it had operated and in the diminution of the value of its other capital assets; such losses exceeding $300,000 in amount. It is therefore charged that the plaintiff Trustee in bankruptcy "is entitled, under the laws of the United States, to recover from the defendants threefold the actual damages suffered by the B. P. R. Corporation." I must conclude that the phrase "laws of the United States" used in each of the complaints as supporting the alleged right of recovery, refers to Section 4 of the Clayton Act, 15 U.S.C.A. § 15, which reads as follows:

"§ 15. Suits by persons injured; amount of recovery.

"Any person who shall be injured in his business or property by reason of anything forbidden in the anti-trust laws may sue therefor in any district court of the United States in the district in which the defendant resides or is found or has an agent, without respect to the amount in controversy, and shall recover threefold the damages by him sustained, and the cost of suit, including a reasonable attorney's fee."

Upon the respective motions of the defendants Fox-N.Y. and Paramount Pictures, each of the actions was dismissed as to those defendants for improper venue. This Court has jurisdiction over the remaining defendants, all of whom have filed answers in each of the actions.

In the Gordon cases, all of the presently remaining defendants in each action have moved for summary judgment in their favor upon the ground that the claims set forth by the plaintiffs in their complaints have abated. In all three of the captioned actions, motions for summary judgment have been made by the defendants Paramount Film and RKO upon the asserted ground that all of the claims set forth in each of the complaints which accrued prior to March 4, 1949, have been barred by the Statute of Limitations of the State of Illinois, or, in the event that this Court holds that the Illinois statute does not govern, that these claims are barred by the New Jersey Statute of Limitations. Finally, Fox-Del. has moved, in all three of the captioned actions, for judgment on the pleadings, upon the ground that Fox-Del. has only been in existence since 1952, a date substantially subsequent to the last date upon which any of the alleged anti-trust violations were committed by any of the defendants.

Motion for Summary Judgment Grounded upon Alleged Abatement in Gordon Actions (202-55 and 204-55).

Defendants in 202-55 and 204-55 move for summary judgment, pursuant to Rule 56(b), Fed.Rules Civ.Proc., 28 U.S.C.A., upon the stated ground that the claims asserted in the complaint in each case have abated. This contention is erected upon the provisions of Section 157.94 of Chapter 32 of the Illinois Revised Statutes 1955 which provides:

"The dissolution of a corporation either (1) by the issuance of a certificate of dissolution by the Secretary of State, or (2) by the decree of a court of equity when the court has not liquidated the assets and business of the corporation, or (3) by expiration of its period of duration, shall not take away or impair any remedy available to or against such corporation, its directors, or shareholders, for any right or claim existing, or any liability incurred, prior to such dissolution if action or other proceeding thereon is commenced within two years after the date of such dissolution. Any such action or proceeding by or against the corporation may be prosecuted or defended by the corporation in its corporate name."

Each of the corporations of which the plaintiffs in these two cases were stockholders was a creature of the laws of the State of Illinois, and the respective rights of the corporation and its stockholders in each instance are governed by the same laws. Chicago Title & Trust Co. v. Forty-One Thirty-Six Wilcox Bldg. Corp., 302 U.S. 120, 58 S.Ct. 125, 82 L.Ed. 147. Each of these cases was commenced on March 3, 1955 by the filing of the complaint in this Court, which date was more than two years after the date of dissolution of each of the Illinois corporations to which the alleged cause of action...