Nutrasweet Co. v. Vit-Mar Enterprises, Inc.

112 F.3d 689 (3rd Cir. 1997)

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Nature of the Case

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Facts

P sold certain shipments of its sweetener Equal to Ds at a 50%-75% discount based on the condition that the buyer would only distribute the product outside the United States. The bill of lading for the shipments contained a provision stating, 'THESE COMMODITIES ARE LICENSED BY THE UNITED STATES FOR THE FINAL DESTINATION [UKRAINE] OR [YAKUTSK REGION, RUSSIA]. ANY DIVERSIONS ARE AGAINST THE LAW.' Tekstilschik, a business entity organized under the laws of the Russian Federation, claims to have acquired one of the shipments in Russia from another Russian company in a barter transaction. Tekstilschik further claims that its decision to have it shipped to the United States was made without knowledge of the marketing restriction imposed by P. Tekstilschik allegedly hired Romano Fashions ('Romano') as its agent for the purpose of bringing the shipment to the United States and processing it through Customs. While the shipment was being processed by the Customs Office, P learned of the shipment's whereabouts and filed the present action to keep Romano from introducing it into the U.S. market. P also learned that the six prior shipments that had been sold for foreign export and distribution only had already been reintroduced into the United States successfully. P filed its suit on May 14, 1996, and made an emergency application for a temporary restraining order on the same day. P and Romano appeared before the district court when that application was presented. At 5:00 p.m. that day, the district court granted a restraining order. The order enjoined the named defendants and 'John Does X, Y & Z, being any other persons or entities participating in the domestic import, sale or transport of the subject shipment' from taking possession of or otherwise dealing with the 'NutraSweet Pre-Entry Product.' The court's order set a hearing on an application for a preliminary injunction for May 22, 1996, and authorized expedited depositions. On May 29, 1996, the hearing had not been held, however, and the district court entered an order resetting it for June 10, 1996. That date, in turn, passed without a hearing on a preliminary injunction having been held and the temporary restraining order remained in effect on June 18, 1996, when Tekstilschik entered a 'special appearance for the sole purpose of contesting the temporary restraints.' The district court decided to deny Tekstilschik's motion to dissolve the temporary restraining order because Tekstilschik had failed to demonstrate 'standing' to challenge the restraining order. At the close of the hearing, counsel for P suggested that the court enter a preliminary injunction. The court declined to do so in the absence of a unanimous agreement of counsel. On July 18, 1996, before a hearing on a preliminary injunction had been held, the district court granted an application of defendants other than Tekstilschik that all proceedings be stayed pending completion of a criminal investigation of several of the defendants. On July 30, 1996, Tekstilschik filed this appeal. Its notice of appeal states that it seeks to challenge (1) the temporary restraining order, (2) the order denying its motion to dissolve that order, and (3) the order staying all proceedings.