Melo-Sonics Corporation v. Cropp
| Citation | 342 F.2d 856 |
| Decision Date | 09 March 1965 |
| Docket Number | No. 14921.,14921. |
| Parties | MELO-SONICS CORPORATION and Southwest Oil Corporation, Appellants, v. David CROPP, Chalmers C. Jordan, Robert W. Lingo and Glass-Tite Industries, Inc. |
| Court | United States Courts of Appeals. United States Court of Appeals (3rd Circuit) |
Robert P. Garbarino, Crumlish & Kania, Philadelphia, Pa. (Donald W. Grieshober, Blackmore & Grieshober, Erie, Pa., on the brief), for appellants.
William F. Illig, Gifford, Graham, MacDonald & Illig, Erie, Pa. (John F. Potter, Erie, Pa., on the brief), for appellees David Cropp, Chalmers C. Jordan and Robert W. Lingo.
Walter T. McGough, Reed, Smith, rick E. Dressler, Cummings & Lockwood, Shaw & McClay, Pittsburgh, Pa. (G. Donald Gerlach, Pittsburgh, Pa., Pat-Stamford, Conn., on the brief), for appellee Glass-Tite Industries, Inc.
Before KALODNER, GANEY and FREEDMAN, Circuit Judges.
This matter is now before the Court on an appeal from the lower court's order granting the individual defendants' motion to dismiss the complaint for failure to state a cause of action against them.
This Court has jurisdiction of the case by virtue of the diversity of citizenship of the parties, the plaintiffs, Melo-Sonics Corporation and Southwest Oil Corporation, being corporations existing and organized under the laws of the State of Delaware, having their principal place of business and offices in the State of Delaware. Prior to filing this cause of action, the name of the plaintiff, Melo-Sonics Corporation, was changed from Southwest Oil Corporation to Melo-Sonics Corporation, Southwest Oil Corporation being a wholly owned subsidiary of plaintiff, Melo-Sonics Corporation, and the name of the plaintiff, Southwest Oil Corporation, was changed from Southwest Oil Corporation to Melo-Sonics Corporation. The defendants, David Cropp and Robert W. Lingo, are citizens of the State of Pennsylvania, residing in Meadville, Pennsylvania. The defendant, Chalmers C. Jordan, is a citizen of Pennsylvania, residing in Saegertown, Pennsylvania. The defendant, Glass-Tite Industries, Inc., is a corporation organized and existing under the laws of the State of Rhode Island, having its principal place of business and offices in Providence, and doing business in Pennsylvania with an office and place of business in Saegertown, Pennsylvania, Glass-Tite being the successor to Saegertown Glass Seals, Inc., having assumed all assets and liabilities of the Saegertown Glass Seals, Inc., including this claim, and has succeeded to its corporate interest.
The claim involves a suit for breach by the individual defendants and inducement to breach by the corporate defendant of a contract with the plaintiffs for purchase of stock held by the defendants in Saegertown Components, Inc., L.C.B. Tool, Inc., and Allegheny Electronics, Inc., for $1,500,000, and in their complaint seek compensatory damages in the amount of $3,056,700, plus punitive and exemplary damages.
The pertinent facts concerning the alleged purchase of the stock of the defendants are as follows: Sometime prior to February 13, 1960, it would appear from the telegrams adverted to later, there was some discussion by certain representatives of Southwest Oil Corporation with the individual defendants concerning the purchase of stock of Saegertown Components, Inc., L.C.B. Tool, Inc., — all of the outstanding stock being owned by the individual defendants — as well as for their 42 per cent stock interest in Allegheny Electronics, Inc. On that date one Vincent Pepicelli, on behalf of the individual defendants, telegraphed Arthur Kania, attorney for the Southwest Oil Corporation, as follows:
GV PHILA 13 PS" EXHIBIT "A"
Kania, in a reply telegram, which was undated, and sent to all of the individual defendants, but in care of David Cropp, was as follows:
SOUTHWEST OIL CORPORATION BY ARTHUR J. KANIA" EXHIBIT "B"
In accordance with the terms of these two telegrams, on February 15, 1960, and thereafter, representatives of the plaintiffs met with defendants and their counsel to formalize the agreement. However, on April 5, 1960, the individual defendants notified the plaintiffs they would not conform to the agreement. Thereafter, the plaintiffs demanded full performance in accordance with the terms of the agreement alleging they were ready, willing and able to perform the terms of said agreement. Thereafter, Cropp, Jordan and Lingo, individually, and as 100 per cent owners of Saegertown Components, Inc., and L.C.B. Tool, Inc., and as 42 per cent owners of Allegheny Electronics, Inc., sold to Saegertown Glass Seals, Inc., predecessor in interest to defendant, Glass-Tite Industries, Inc., their stock for a total consideration of $4,556,700. Upon the filing of the plaintiffs' complaint, the individual defendants moved to dismiss; the corporate defendants, however, did not join as they indicated they were only secondarily liable. The court below granted the motion to dismiss before answers to certain pre-trial interrogatories filed by the plaintiff had been answered.
In the disposition of this case, it is important to keep in mind the well-settled rule that all facts contained in the complaint and every inference fairly deducible therefrom, taking into consideration any factual information the Court can take judicial notice of, which includes the record herein, should be treated as admitted and proved, viewing the same in the light most favorable to the...
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