or indirectly selling or offering to sell their garments at prices in excess of the maximum prices determined pursuant to the Regulations. The evidence presented shows the defendants have not complied with these provisions of the Act and the Regulations. Plaintiff is entitled to the injunction requested.
Findings of Fact.
1. Defendants Morris H. Senderowitz, Morris Senderowitz and Abraham M. Senderowitz are co-partners doing business under the name of Royal Manufacturing Company and maintain a place of business at 645 North Jordan Street, Allentown, Pennsylvania. Defendants are engaged in the business of manufacturing and selling men's and boys' shorts.
2. In March 1943 defendants commenced manufacturing and selling new types of men's and boys' shorts designated as style numbers 259, 259(b) and 467. These styles were not previously manufactured and sold by defendants. Their manufacture and sale were discontinued in April 1944.
3. Between July 15, 1943, and July 14, 1944, defendants sold and delivered 3,579 1/2 dozen men's shorts style number 467 at $ 2.90 per dozen, 1,948 dozen of the same style at $ 3.00 per dozen, and 3,417 dozen of the same style at $ 3.15 per dozen; 750 dozen men's shorts style number 259 at $ 2.37 1/2 per dozen, and 29, 240 1/2 dozen of the same style at $ 2.50 per dozen; 6,478 1/2 dozen boys' shorts style number 259(b) at $ 2.37 1/2 per dozen, and 950 dozen of the same style at $ 2.50 per dozen.
4. The determination of the maximum selling price for styles 467, 259, and 259(b) was controlled by General Maximum Price Regulation § 1499.3(b), 7 F.R. 3154, effective May 11, 1942, which, as amended, has been in effect at all times since that date. Section 1499.3(b) of the Regulations provided the exclusive method of establishing maximum prices for the new styles of men's and boys' shorts known as style numbers 467, 259, 259(b).
5. As originally promulgated, Section 1499.3(b) of the Regulations required defendants to calculate the maximum price for styles 467, 259 and 259(b), after obtaining specific authorization from the Office of Price Administration, according to a prescribed formula, and to report the price within ten days subject to adjustment by the Administrator.
6. On May 24, 1943, the Administrator amended Section 1499.3(b) by Amendment 54, F.R. 6962. The amendment eliminated the requirement that defendants obtain authorization from the Administrator before calculating the maximum price for these new garments. Defendants were still required to report the maximum price within ten days from the date of determination by them and this submitted maximum price was subject to approval, disapproval or adjustment by the Administrator.
7. On May 13, 1944, the Administrator promulgated Amendment 61, 9 F.R. 5169, effective on June 1, 1944. This amendment, inter alia, added subsection (e)(1) to Section 1499.3 of the Regulations. This subsection provided that the Administrator 'may at any time approve, disapprove or revise maximum prices reported, proposed or established under paragraphs (a), (b)(1), or (c) of this section so as to bring them into line with the level of maximum prices otherwise established by this regulation.'
8. During June 1944, approximately two months after manufacture and sales of styles 467, 259, 259(b) had ended, the Administrator began an investigation of defendants' business operations which continued for a period of several months.
9. On July 14, 1944, before completing this investigation, the Administrator filed a complaint averring, in a general manner, that defendant had made sales at prices in excess of the maximum prices established by the applicable price regulation.
10. As of July 14, 1944, defendants had not reported the self-determined maximum prices for styles 467, 259 and 259(b) to the Administrator. This was a violation of the provisions of Section 1499.3(b) of the Regulations which required defendants to submit their computed maximum prices to the Administrator for approval within ten days after their determination.
11. On August 1, 1944, two weeks after the filing of the complaint and about three months after defendants stopped selling the garments, defendants filed their self-determined maximum prices for styles 467 and 259 with the Administrator as provided in the Regulations.
12. On October 20, 1944, three months after the complaint was filed, the Administrator issued Order No. 112 under the authorization of Section Section 1499.3(e)(1), adjusting the maximum selling price for styles 467 and 259. The order stated that defendants' determination of maximum prices, submitted August 1, 1944, was not in line with the level of maximum prices, and that defendants' maximum selling price for sales to wholesalers and retailers 'shall be established' at $ 1.60 per dozen for style number 467, and $ 1.50 per dozen for style number 259. These prices were lower than those submitted by defendants on August 1, 1944 and were below the prices at which these styles were sold between July 1943 and July 1944.
13. On May 8, 1945, about ten months after the suit was begun, the Administrator filed an amendment to Order No. 112 (Paragraph 12) purporting to make the adjusted maximum price for styles 467 and 259 effective retroactively to cover the sales prior to August 1, 1944.
14. Between July 15, 1943, and July 14, 1944, defendants sold 849 1/2 dozen shorts style number 1810 at $ 3.25 per dozen; 1,857 dozen shorts style number 1850 at $ 3.25 per dozen; 24 dozen shorts style number 461 at $ 3.37 1/2 per dozen; 100 dozen shorts style number 459(b) at $ 2.62 1/2 per dozen; and 100 dozen shorts style number 469 at $ 3.60 per dozen.
15. Under the provisions of Section 1499.2(a) of the Regulations the maximum selling prices for the styles enumerated in 14 above were the highest prices at which defendants sold and delivered these styles in March 1942. As determined in this manner, the maximum selling prices for these garments between July 1943 and July 1944 were: $ 3.10 per dozen for style 1810; $ 3.10 per dozen for style 1850; $ 3.25 per dozen for style 461; $ 3.50 per dozen for style 469; and $ 2.50 per dozen for style 459(b).
16. Within one year prior to the date of the complaint defendants made a total of thirteen sales of styles 1810, 1850, 461, 469 and 459(b) for a total overcharge in excess of the applicable maximum prices for these styles in the amount of $ 419.05.
17. All of defendants' sales and deliveries of men's and boys' shorts styles 259, 259(b), 467, 1810, 1850, 461, 469 and 459(b) during the period between July 15, 1943 and July 14, 1944 were made to purchasers for their use in the course of trade or business. These sales were made to wholesalers or retailers and not to the ultimate consumer.
18. Those sales by defendants which were at prices in excess of the maximum prices were either wilful or the result of defendants' failure to take practical precautions against the occurrence of such violations. Defendants' conduct was in complete disregard of the requirements of the General Maximum Price Regulations and the duties imposed upon them by law.
Conclusions of Law.
1. Defendants violated Section 1499.3(b)(1) of the General Maximum Price Regulations in that they failed to report to the Office of Price Administration their determination of maximum prices for men's and boys' shorts style numbers 259, 259(b) and 467 within the time permitted by the Regulations.
2. Defendants violated the provisions of Section 4(a) of the Emergency Price Control Act of 1942, 50 U.S.C.A.Appendix § 904(a), and Section 1499.1 of the General Maximum Price Regulations by making thirteen sales of men's and boys' shorts, styles 1810, 1850, 461, 469 and 459(b) at a total overcharge of $ 419.05.
3. Judgment should be entered in favor of plaintiff on behalf of the United States of America for treble the amount of these overcharges, or a total amount of $ 1,257.15.
4. An injunction should issue (1) enjoining defendants, their servants, agents and employees and all persons in active concert or participation with any of them from selling, or agreeing to sell, men's or boys' shorts at prices in excess of maximum prices established under the provisions of the Emergency Price Control Act of 1942, and (2) directing the defendants to keep and maintain the records required by the Regulations promulgated thereunder.