Mcglnnls Piano & Organ Co. v. Yamaha Internat'l Corp
480 F. 2d 474 (8th Cir. 1973)
Nature of the Case
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Facts
McGinnis (P) agreed to sell Yamaha (D) pianos under an informal agreement. P expended considerable effort and resources for six years and promoted D's pianos and opened a Yamaha School of Music. D terminated the agreement and refused to sell pianos to P. P had six weeks' notice of the termination. P sued for breach of an implied franchise. The court instructed the jury:
An implied franchise would be found if P exerted a large amount of time and effort in selling and promoting a specific product. Reasonable notice is required before an implied franchise could be terminated. Reasonable notice could be interpreted by two methods: (1) as a reasonable time to recoup investment and lost profits; or (2) as a reasonable time set in the future by the jury itself.
The verdict was given to P. D appealed; Reasonable notice was the time necessary to close out the line while minimizing losses or the time necessary to recoup the investment in the franchise.
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