Volvo North America Corp. v. Men's Intern. Professional Tennis Council

• Decision Date: 08 February 1988
• Citation: 839 F.2d 69
• Parties: 1988-1 Trade Cases 67,902 VOLVO NORTH AMERICA CORPORATION, International Merchandising Corporation and Pro-Serv, Inc., Plaintiffs-Appellants, v. MEN'S INTERNATIONAL PROFESSIONAL TENNIS COUNCIL, M. Marshall Happer, III and Philippe Chatrier, Defendants-Appellees. MEN'S INTERNATIONAL PROFESSIONAL TENNIS COUNCIL and M. Marshall Happer, III, Counterclaimants, v. VOLVO NORTH AMERICA CORPORATION, International Merchandising Corporation and Pro-Serv, Inc., Counterclaim-Defendants, and Donald L. Dell, Raymond S. Benton, Dell, Benton & Falk, Mark H. McCormack, International Merchandising Group, International Management Inc., Transworld International Inc., and A.B. Volvo, Additional Counterclaim-Defendants. Dockets 87-7776, 87-7778 and 87-7784.
• Court: U.S. Court of Appeals — Second Circuit

Page 69

839 F.2d 69

1988-1 Trade Cases 67,902

VOLVO NORTH AMERICA CORPORATION, International Merchandising

Corporation and Pro-Serv, Inc., Plaintiffs-Appellants, v. MEN'S INTERNATIONAL PROFESSIONAL TENNIS COUNCIL, M. Marshall

Happer, III and Philippe Chatrier, Defendants-Appellees.

MEN'S INTERNATIONAL PROFESSIONAL TENNIS COUNCIL and M.

Marshall Happer, III, Counterclaimants, v. VOLVO NORTH AMERICA CORPORATION, International Merchandising

Corporation and Pro-Serv, Inc., Counterclaim-Defendants,

and

Donald L. Dell, Raymond S. Benton, Dell, Benton & Falk, Mark

H. McCormack, International Merchandising Group,

International Management Inc., Transworld International

Inc., and A.B. Volvo, Additional Counterclaim-Defendants.

Dockets 87-7776, 87-7778 and 87-7784.

United States Court of Appeals Second Circuit.

Argued Oct. 20, 1987.

Decided Feb. 8, 1988.

Roy L. Reardon, New York City, (Simpson Thacher & Bartlett, Mary Elizabeth McGarry, New York City, of counsel), for defendants-appellees.

James J. Maloney, New York City (Rogers & Wells, Michael F. Coyne, Donald P. Alexander, Nancy A. Brown, James C. Oschal, New York City, of counsel), for plaintiff-appellant Volvo North America Corp.

Lloyd I. Isler, P.C., New York City, for plaintiff-appellant Intern. Merchandising Corp.

Robert S. Litt, Washington, D.C. (Williams & Connolly, Mark S. Levinstein, William R. Murray, Jr., Washington, D.C., of counsel), for plaintiff-appellant Pro-Serv, Inc.

Before OAKES, CARDAMONE, and MAHONEY, Circuit Judges.

MAHONEY, Circuit Judge:

Defendants-appellees, Men's International Professional Tennis Council, M. Marshall Happer, III and Phillippe Chatrier (collectively "MIPTC"), move to dismiss the consolidated appeals of plaintiffs-appellants Volvo North America Corporation ("Volvo"), International Merchandising Corporation ("IMC") and ProServ, Inc. ("ProServ") for lack of jurisdiction over the appeals. The appeals were taken from a memorandum and order of the United States District Court, 678 F.Supp. 1035, for the Southern District of New York, Kevin Thomas Duffy, Judge, entered August 10, 1987, which dismissed, pursuant to Fed.R.Civ.P. 12(b)(6), ¹ plaintiffs-appellants' thirteen count amended complaint alleging various antitrust violations injuring all plaintiffs-appellants, and various contractual and related violations injuring Volvo alone, and requesting damages and injunctive relief relating to various practices in which MIPTC allegedly engages with respect to its conduct and promotion of the Grand Prix Circuit ("Grand Prix"), a series of men's professional tennis tournaments.

Specifically, counts one through seven and thirteen were dismissed without leave to replead, and are those primarily at issue on this appeal. The action below remains open pending the determination of counterclaims (as well, of course, as any of counts eight through twelve of the dismissed complaint that may be repleaded). Judge Duffy declined to enter any final judgment pursuant to Fed.R.Civ.P. 54(b), so appellate jurisdiction will not lie under 28 U.S.C. Sec. 1291 (1982). MIPTC contends that the dismissal of the amended complaint does not constitute the refusal of an injunction, and thus that there is also no jurisdiction over the appeals under 28 U.S.C. Sec. 1292(a)(1) (1982), which provides for immediate appeal of interlocutory orders that grant, continue, modify, refuse or dissolve injunctions, or refuse to dissolve or modify them.

We grant the motion to dismiss the appeal as to counts eight through twelve, which were dismissed with leave to replead, as well as count thirteen, which does not seek injunctive relief, and deny the motion as to counts one through seven, which seek injunctive relief and were dismissed without leave to replead.

Background

This case stems from a dispute between MIPTC, an unincorporated association that, since 1974, has organized and overseen the Grand Prix, and Volvo, which from 1980 through 1984 was the overall sponsor of the Grand Prix. In February, 1984, following contract bids, the MIPTC named Nabisco Brands, Inc. as the 1985 Grand Prix sponsor. Volvo then entered into an agreement with MIPTC (the "Agreement") whereby Volvo assigned its then existing contracts with NBC and Madison Square Garden to MIPTC in exchange for subsidiary sponsorship of several individual Grand Prix events, and Volvo and MIPTC agreed to cooperate with each other's reasonable promotional activities.

In April, 1985, however, Volvo filed suit against MIPTC over the discontinued sponsorship and subsequent arrangements. In September, 1985, IMC and Pro-Serv, which engage both in the representation of male professional tennis players and the production of men's professional tennis events, were allowed to intervene over the objections of MIPTC, and plaintiffs-appellants were granted leave to file the amended complaint whose dismissal is the subject of this appeal.

Counts one through five of the amended complaint allege various violations of federal antitrust statutes by MIPTC injuring all plaintiffs. The gravaman of the antitrust allegations is that MIPTC controls access to the major men's professional tournaments, and has used this control to impose restrictions upon male professional tennis players which hamper the ability of actual and potential competitors of MIPTC to conduct competing tennis events. Count six alleges interference with prospective business relationships, and count seven unfair competition, again injuring all plaintiffs. Treble damages are sought with respect to counts one through five, compensatory and punitive damages are sought with respect to counts six and seven, and declaratory and extensive injunctive relief are sought with respect to all seven counts.

Counts eight through thirteen are alleged only by Volvo, and assert breach of contract (counts eight and ten), fraud (counts nine and eleven), defamation (count twelve) and product disparagement (count thirteen). Damages are sought with respect to all these counts, as well as limited injunctive relief under counts ten and eleven relating to alleged breaches of the Agreement by MIPTC and related matters.

MIPTC moved to dismiss the amended complaint, and the district court granted that motion by a memorandum and order filed August 10, 1987. Leave to replead was denied with respect to counts one through seven and thirteen, but granted with respect to counts eight through twelve.

Plaintiffs-appellants filed appeals from the order of dismissal on September 8 and 9, 1987. Shortly thereafter, the district court declined to enter any final judgment pursuant to Fed.R.Civ.P. 54(b). ² MIPTC now moves to dismiss the appeals, claiming that this court lacks jurisdiction over the appeals because they are not taken from a final order pursuant to 28 U.S.C. Sec. 1291 (1982), and also do not qualify under 28 U.S.C. Sec. 1292(a)(1) (1982), which provides for the immediate appeal of interlocutory orders that grant, continue, modify, refuse or dissolve injunctions, or refuse to dissolve or modify them. Plaintiffs-appellants contend that the order dismissing the claims is appealable as of right under 28 U.S.C. Sec. 1292(a)(1) (1982) because it refuses an injunction within the meaning of that provision.

Discussion

In determining whether this court has jurisdiction over these appeals, we must begin with the statutory provision at issue. 28 U.S.C. Sec. 1292(a)(1) (1982) states in pertinent part:

Sec. 1292. Interlocutory decisions

(a) ... [T]he courts of appeals shall have jurisdiction of appeals from:

(1) Interlocutory orders of the district courts of the United States, ... or of the judges thereof, granting, continuing, modifying, refusing or dissolving injunctions, or refusing to dissolve or modify injunctions ...

This statute provides an exception to the longstanding rule, codified in 28 U.S.C. Sec. 1291 (1982), that appeals should generally be taken only from a final judgment of a district court. The policy underlying this rule was stated by the Supreme Court in McLish v. Roff, 141 U.S. 661, 12 S.Ct. 118, 35 L.Ed. 893 (1891):

From the very foundation of our judicial system the object and policy of the acts of Congress in relation to appeals and writs of error ... have been to save the expense and delays of repeated appeals in the same suit, and to have the whole case and every matter in controversy in it decided in a single appeal.

Id. at 665-66, 12 S.Ct. at 120 (citation omitted). See also Stringfellow v. Concerned Neighbors In Action, --- U.S. ----, ----, 107 S.Ct. 1177, 1184, 94 L.Ed.2d 389 (1987).

The exception for certain appeals from interlocutory orders dealing with injunctions was first introduced in 1891, and has developed over the years into the present enactment codified in 28 U.S.C. Sec. 1292(a)(1) (1982). See generally Baltimore Contractors v. Bodinger, 348 U.S. 176, 180 & n. 6, 75 S.Ct. 249, 252 & n. 6, 99 L.Ed. 233 (1955) (discussing history of section 1292).

Plaintiffs-appellants contend that the present appeal falls squarely within the terms of section 1292(a)(1). MIPTC contends, on the contrary, that this section has been definitively construed in Carson v. American Brands, Inc., 450 U.S. 79, 101 S.Ct. 993, 67 L.Ed.2d 59 (1981) (hereinafter "Carson "), so as to preclude appellate jurisdiction in the present case.

Before dealing with Carson, however, we must consider General Electric Co. v. Marvel Rare Metals Co., 287 U.S. 430, 53 S.Ct. 202, 77 L.Ed. 408 (1932) (hereinafter "General Electric "), which is very closely on point. In General Electric, a defendant in a patent infringement suit counterclaimed for patent infringement, seeking an injunction and accounting, and the counterclaim was dismissed on plaintiffs' motion for want of personal jurisdiction over the plaintiffs. Defendant appealed, successfully contending in both the Sixth Circuit Court of Appeals and the Supreme Court for the sensible result that plaintiffs could not, under the pertinent statutes and...