Ross-Simons Of Warwick, Inc. v. Baccarat, Inc.

102 F.3d 12 (1st Cir. 1996)

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Nature of the Case

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Facts

Baccarat (D) is a subsidiary of the French crystal manufacturer. D is the exclusive distributor in the U.S. for the aristocratic product line. Ross-Simons (P) sells jewelry, tableware, crystal and other merchandise in its retail stores located in several states. Eighty-five percent of P’s business is generated through catalog and telemarketing sales. P distributes 45,000,000 catalogs annually. P frequently gives deep discounts as part of its sales strategy. D comes from a different school of thought and seeks to resist discounting and discounters. For many years, D refused to sell to P. P filed an antitrust suit against D, and in 1992 the parties entered into a written accord, and the district court dismissed the antitrust suit without prejudice. The 1992 agreement appointed P as an authorized dealer entitled to purchase and resell D’s products. D also agreed not to terminate P and not to discriminate against P for refusing to adhere to suggested retail prices. P sold the products for three years without incident. When new management came into D, it limited the number of retailers that could sell the product and introduced an authorized dealer program. The agreement prohibited the advertising of the products in any catalog or other printed medium that promotes discount prices for more than 25% off. P viewed this agreement as a suicide note and asserted that it violated the terms of the 1992 agreement. P sued D claiming breach of contract and D removed the case to district court. The district court conducted an evidentiary hearing and granted P’s motion to compel D, pendente lite, to continue to sell products according to the 1992 agreement. D appealed.