provide an indiscriminate marketing arrangement for all hobby manufacturers. Only the novelty of the product and the resultant consumer demand dictates which manufacturer will receive the bulk of the wholesalers' business. This is an extremely fluid market and competition is keen for the outlets serviced by the plaintiff wholesalers. The plaintiffs have shown that they have enjoyed amicable business relations with all hobby manufacturers for many years. It was only when the Airfix line became an American manufacturer that Aurora saw the necessity to resort to restrictive measures against the plaintiffs.
Being the leader in the industry, Aurora alerted the other manufacturers to the threatened peril of the increased competition presented by Airfix. By imposing its will on other wholesalers, and corraling support from competing manufacturers, Aurora effectively cut the jugular of supply open to the plaintiff wholesalers, thereby accomplishing a concerted boycott of Airfix products throughout the country.
A manufacturer such as Aurora who conspires with others to accomplish what he could lawfully achieve when acting alone may violate § 1 of the Sherman Act. Opinion of U.S. Court of Appeals, 9th Circuit, Walker Distributing Co. v. Lucky Lager Brewing Co., 323 F.2d 1.
'Thus, whether an unlawful combination or conspiracy is proved is to be judged by what the parties actually did rather than by the words they used.' United States v. Parke Davis & Co., 362 U.S. 29, 44, 80 S. Ct. 503, 512, 4 L. Ed. 2d 505 (1959).
We cannot say that the plaintiffs have not demonstrated a reasonable probability that they will be successful in their main action under the antitrust laws. They have also proved that irreparable harm will result if a preliminary injunction does not issue.
CONCLUSIONS OF LAW
1. This Court has jurisdiction of this action under the antitrust laws.
2. The record evidences substantial question as to the legality of the acts of the defendants and it appears probable that plaintiff wholesalers will establish a violation of the antitrust laws of the United States upon final hearing.
3. Immediate and irreparable injury will result to plaintiff wholesalers if a preliminary injunction is not granted.
4. The balance of conveniences weighs heavily in favor of plaintiff wholesalers and the preliminary injunction should issue to maintain the status quo pending final decision.
5. Plaintiffs have no plain, speedy or adequate remedy at law with respect to the matters herein found.
AND NOW, this 24th day of October, 1963, upon consideration of the record, including request for findings of fact and conclusions of law, and hearing and oral argument having been had, and it appearing that irreparable injury, loss and damage will result to the applicants unless this preliminary injunction issues forthwith, preliminarily, until final hearing and decision, IT IS HEREBY ORDERED, ADJUDGED AND DECREED as follows:
1. Defendants Aurora Plastics Corp., K & B Manufacturing Corp., and Tru-Scale Products, Inc., be and they hereby are restrained and enjoined from discontinuing the sale of hobby kits and similar merchandise to plaintiffs B. Paul Model Distributors, Inc., Niagara Hobby Distributors, Inc., Mayflower Distributors, Inc., Holiday Hobby Distributors, Inc., and Gateway Hobby Distributors, Inc., and are hereby Ordered to continue with such sales in the usual course of business as it existed prior to the institution of the instant proceedings.
It is further directed that the terms and conditions of payment shall be as provided on the invoices covering the goods sold and the terms and conditions of the invoices shall be as heretofore. The defendants are further Ordered to fill promptly purchase orders heretofore placed with them by said plaintiff wholesalers.
2. The Court having been advised that a general appearance has been entered for the defendants in the collateral foreign attachment proceedings, the plaintiff or plaintiffs are Ordered and Directed to forthwith make provision for the release and payment over to the defendant or defendants in the sum of approximately $ 106,000 presently held in those foreign attachment proceedings.
3. The defendants Aurora Plastics Corp. and K & B Manufacturing Corp., be and they hereby are restrained and enjoined from discontinuing the sale of hobby kits and similar merchandise through William Korr as a manufacturers' representative of Airfix upon the usual terms and conditions of payment.
4. Defendants are further restrained and enjoined from endeavoring to coerce, intimidate or induce, and from coercing, intimidating or inducing other manufacturers of hobby kits and similar merchandise, to discontinue dealing with plaintiffs or any of them; from discontinuing the sale of merchandise to plaintiffs, or any of them, or to other persons dealing with plaintiffs or handling plaintiffs' merchandise, upon usual and customary terms and conditions of payment, imposing onerous and unusual conditions of sale, for the purpose of coercing, intimidating or inducing plaintiffs other than Airfix Corporation of America or other persons from dealing in Airfix Corporation of America merchandise and in the case of such other persons from dealing with any of the plaintiffs.
5. Any outstanding indebtedness existing between the parties in this litigation which is due and payable in accordance with the invoices as herein set forth shall be liquidated and paid on or before Monday, October 28, 1963. On failure to do so, defendants may move the Court to modify or dissolve this preliminary injunction.
6. Any party hereto may on 48 hours' notice to the adverse parties apply for amendment, clarification or relief from the provisions of this decree.
This decree shall become effective upon the filing of a bond by plaintiffs in the amount of $ 25,000.
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