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Buckingham Corp. v. Ewing Liquors Co.

NOVEMBER 6, 1973

THE BUCKINGHAM CORPORATION, PLAINTIFF-APPELLEE,

v.

EWING LIQUORS CO., D/B/A FOREMOST LIQUORS, DEFENDANT-APPELLANT.



APPEAL from the Circuit Court of Cook County; the Hon. JAMES J. MEJDA, Judge, presiding.

MR. PRESIDING JUSTICE STAMOS DELIVERED THE OPINION OF THE COURT:

Defendant, Ewing Liquors Co., appeals from an order granting plaintiff a permanent injunction. The trial court found that plaintiff's Cutty Sark scotch whiskey is sold in Illinois pursuant to a valid fair trade agreement, and that on December 13, 1971, defendant knowingly sold Cutty Sark scotch whiskey at a price below plaintiff's fair trade price in contravention of the Illinois Fair Trade Act. *fn1 The order permanently enjoined defendant from advertising, offering for sale or selling plaintiff's products in Illinois at prices less than those stipulated by plaintiff from time to time pursuant to the fair trade agreement. Plaintiff's fair traded products and their current prices were also set forth in the order.

On appeal defendant contends that:

1. Plaintiff failed to prove the execution of the fair trade agreement;

2. Plaintiff failed to prove knowledge by defendant of its fair trade prices;

3. Plaintiff failed to prove that its products were in fair and open competition;

4. Plaintiff's fair trade agreement is invalid in that it provides for minimum prices, not stipulated prices;

5. Plaintiff, a foreign corporation, cannot maintain a cause of action in Illinois because it has failed to obtain a certificate of authority to do business in Illinois as required by Illinois Revised Statutes, 1971, ch. 32, pars. 157.102, 157.125; and

6. The injunction order is invalid in that it lacks specificity.

Plaintiff filed a verified complaint alleging that Cutty Sark scotch whiskey is in free and open competition in Illinois; that plaintiff imports and distributes this product to wholesale distributors in Illinois; that plaintiff has entered into fair trade contracts in Illinois wherein it is provided that Cutty Sark shall not be sold, advertised or offered for sale at prices below the prices stipulated by plaintiff; that defendant had due notice of the stipulated prices; that on December 13, 1971 defendant sold a fifth of Cutty Sark scotch whiskey at a price of $5.99 whereas the fair trade price was $6.59; and that defendant is continuing knowingly to sell Cutty Sark scotch whiskey at prices below the fair trade prices. *fn2

Defendant filed a verified answer denying plaintiffs material allegations, and raising various affirmative defenses. Plaintiff then filed a reply to defendant's answer, and attached an affidavit of Ted Herbik, an employee of Buckingham Distributors, a letter from plaintiff to all Illinois liquor retailers informing them of amended fair trade prices effective December 1, 1969, and a page from the December, 1969 issue of the Illinois Beverage Journal reproducing plaintiff's letter to Illinois retailers.

At the hearing for a temporary injunction, the parties stipulated that they would proceed with a hearing for a permanent injunction. A private detective testified that on December 13, 1971 he entered defendant's store and purchased a fifth of Cutty Sark scotch whiskey at a price of $5.99. He testified that the fair trade price schedule which he received from plaintiff's attorney listed the fair trade price as $6.59 per fifth. His report was introduced into evidence.

The managing editor of the Illinois Beverage Journal testified that the Journal is a trade publication which advertises, lists trade prices and publishes news of interest in the industry. He stated that the Journal conducted a mailing of price schedules for Buckingham Corporation in November, 1969, and that defendant was on that mailing list. The witness admitted on cross-examination that he had no personal knowledge of whether defendant received the letter, or indeed of whether in fact the letter had actually been mailed to defendant, because the mailing was handled by the Journals mailing service. However, the witness did receive an attestation from the mailing service that the mailing was being conducted. On redirect examination the witness stated that the mailing service handled 4 or 5 mailings per month other than the Journal, and had been reliable for 17 years. In addition, defendant was a subscriber to the Journal in December, 1969, and plaintiff's price schedule was reproduced in that issue of the Journal. Reproductions of the price list as it was mailed, and as it was reproduced in the Journal, were introduced into evidence.

Evidence of the fair trade agreement was then adduced. A Chicago liquor retailer acknowledged his signature on a fair trade agreement dated July 30, 1969 between himself and Buckingham Corporation. Ted Herbik, a marketing director of Buckingham Distributors, testified that he recognized the signature of William Gallagan, plaintiff's vice-president, and he identified Gallagan's signature on the July 30, 1969 agreement. He stated that he was familiar with Gallagan's signature because he had received correspondence from ...


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