Sally Beauty Co., Inc v. Nexxus Products Co., Inc.

801 F.2d 1001 (7th Cir. 1986)


In July 1981 P acquired Best Barber & Beauty Supply Company, Inc. in a stock purchase transaction and Best was merged into P, which succeeded to Best's rights and interests in all of Best's contracts. P, a Delaware corporation with its principal place of business in Texas, is a wholly-owned subsidiary of Alberto-Culver. P, like Best, is a distributor of hair care and beauty products to retail stores and hair styling salons. Alberto-Culver is a major manufacturer of hair care products and, thus, is a direct competitor of D in the hair care market. Best had an exclusive best efforts agreement to distribute and promote D hair care products in the Texas market. D refused to continue its agreement with Best after the merger. P sued D for breach of contract and a violation of antitrust laws. D moved for summary judgment on the breach of contract claim. That motion was granted because the trial court reasoned that the contract was not an ordinary commercial contract, but a contract based upon a relationship of personal trust and confidence between the parties. P appealed.