21. The defendants have been selling 'Cosco' products at less than the fair trade price since June, 1958, and there is no persuasive evidence that the institution of this price policy at this time was a response to price cutting by their competitors.
22. On February 27, and March 10, 1959 each defendant offered for sale and sold at retail, juvenile furniture manufactured and sold by plaintiff, at less than the price established by the plaintiff in its fair trade agreements.
23. Each of the defendants displayed signs on items of 'Cosco' furniture in its store showing the advertised fair trade price and the store's selling price which in each instance was from $ 1 to more than $ 3 less than the established fair trade price.
24. About three weeks after these suits were filed, employees of these defendants and the wife of one of their store managers shopped at nine different retail stores. At each of these stores a single purchase of 'Cosco' furniture at less than the fair trade price was made.
25. None of the defendants notified Hamilton Cosco of these price violations or of one other price violation, by two of the same stores, of which defendants' president learned before Christmas, 1958.
26. Two days after plaintiff learned of these violations from the testimony of defendants' witnesses at the first hearing on April 13, 1959, plaintiff's counsel sent warning letters to each of the nine stores.
27. A week after the first hearing plaintiff's district sales representative visited all nine of the stores, restored the fair trade prices in two stores which were not then observing them, and obtained signed fair trade contracts from eight of the nine stores. A price survey that was made several days later showed that each of the nine stores was maintaining Cosco's fair trade prices.
28. Plaintiff enforces its fair trade prices with reasonable diligence and effectiveness, including the use of legal proceedings where necessary.
The foregoing findings of fact, most of which are not in dispute, are supported by clear and credible evidence.
The Pennsylvania Fair Trade Act (Act of June 5, 1935, P.L. 266), as amended, 73 P.S. § 7-11, provides in Section 2 as follows:
'Wilfully and knowingly advertising, offering for sale, or selling any commodity at less than the price stipulated in any contract entered into pursuant to the provisions of section one of this act, whether the person so advertising, offering for sale, or selling is, or is not, a party to such contract, is unfair competition and is actionable at the suit of such vendor, buyer or purchaser of such commodity. It shall, however, be a complete defense to such an action for the defendant to prove that the party stipulating such price, after at least seven days written notice given by the defendant prior to the commencement of such action, has failed to take reasonable and diligent steps to prevent the continuation of such advertising, offering for sale or selling, by those in competition with the defendant, who were specified in such notice.'
Defendants introduced evidence to show that their representatives had made a single purchase of a piece of 'Cosco' furniture at less than the fair trade price at nine retail establishments. These purchases were made three weeks after the commencement of the instant actions. Defendants' president, Nelson, testified that on one occasion before Christmas, 1958, he had also stopped in two of these same stores and found them selling 'Cosco' products at less than the fair trade price. Nelson admitted that none of the defendants had ever notified plaintiff of any of these occurrences. Plaintiff moved to strike this testimony because defendants had failed to comply with the provisions of the Act, above quoted.
We think plaintiff's motion must be denied. Defendants, it is true, wholly failed to comply with the mandate of the Act, but we think the testimony was admissible by way of a general defense of lack of enforcement of plaintiff's fair trade prices. We have concluded, however, that defendants have failed to establish that defense.
The evidence clearly establishes that defendants have engaged in unfair competition, and, accordingly, plaintiff is entitled to the relief prayed for in the complaint. Lentheric, Inc. v. F. W. Woolworth Co., 1940, 338 Pa. 523, 13 A.2d 12; Olin Mathieson Chemical Corporation v. L. & H. Stores, Inc., 1958, 392 Pa. 225, 139 A.2d 897.
Conclusions of Law
1. This Court has jurisdiction over the parties to and the subject matter of each action.
2. Each defendant has wilfully and knowingly offered for sale and sold 'Cosco' products in violation of the provisions of the Pennsylvania Fair Trade Act.
3. The aforesaid actions of each defendant constitute unfair competition under the Pennsylvania Fair Trade Act.
4. The continued violation by each defendant of the Pennsylvania Fair Trade Act threatens irreparable injury to plaintiff's goodwill in its 'Cosco' products.
5. Under the Pennsylvania Fair Trade Act a defendant which seeks to invoke the defense of non-enforcement provided by the 1956 amendment is obliged to notify the fair trade manufacturer of other price violations by its own competitors at least seven days prior to the filing of suit. Since none of the defendants in these cases gave such notice to the plaintiff, this defense is unavailable to each defendant.
6. Plaintiff has no adequate remedy at law.
7. Plaintiff is entitled to final judgment against each defendant with costs.
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