for summary judgment will be denied.
2. Defendants' Motion for Judgment on the Pleadings, or in the alternative, for Summary Judgment.
Section 1 of the Sherman Act prohibits combinations and conspiracies which unreasonably restrain competition. Plaintiff alleges that a conspiracy and agreement exists among Cavitron, Clev-Dent and Coles. Defendants have asserted by affidavit, and plaintiff has not denied, that Clev-Dent is an integral division of Cavitron, and does not have a separate legal existence. As a division of Cavitron, Clev-Dent is not capable of conspiracy, apart from Cavitron. Joseph E. Seagram & Sons, Inc. v. Hawaiian Oke & Liquors, Ltd., 416 F.2d 71 (9th Cir. 1969), cert. denied, 396 U.S. 1062, 24 L. Ed. 2d 755, 90 S. Ct. 752, reh. denied, 397 U.S. 1003, 90 S. Ct. 1113, 25 L. Ed. 2d 415 (1970); Goldlawr, Inc. v. Shubert, 276 F.2d 614 (3d Cir. 1960). What remains, therefore, is a charge of a conspiracy between Cavitron and Coles to refuse to sell to plaintiff. Defendants have asserted, and plaintiff has not denied, that Cavitron acquired the stock of Coles and Coles is now its subsidiary.
An agreement between a parent and a subsidiary to terminate a distributor, or substitute new distributors for old, is not an unreasonable restraint of trade in violation of Section 1 of the Sherman Act "in the absence of some forbidden anti-competitive or monopolistic objective." Joseph E. Seagram & Sons, Inc. v. Hawaiian Oke & Liquors, Ltd., supra 416 F.2d at p. 82. Ace Beer Distribut., Inc. v. Kohn, Inc., 318 F.2d 283 (6th Cir.), cert. denied, 375 U.S. 922, 84 S. Ct. 267, 11 L. Ed. 2d 166, reh. denied, 375 U.S. 982, 84 S. Ct. 479, 11 L. Ed. 2d 428 (1963); Beckman v. Walter Kidde & Co., Inc., 316 F. Supp. 1321 (E.D.N.Y. 1970) and cases cited therein.
It is uncontroverted in this record that there are products which perform the same function and are in competition with defendants' product; that there are five dealers handling defendants' product in the Philadelphia area, and that there are another 345 dealers nationwide who are free to sell in this area; that Cavitron ordered sales to cease to plaintiff and other Coles' dealers until a reorganization of marketing procedures was completed; and that defendants have not conspired with other manufacturers or dealers to prevent plaintiff from purchasing the product. Under the circumstances, there could be no unreasonable restraint of trade in defendants' decision to terminate sales to plaintiff. See Tripoli Co., Inc. v. Wella Corp., 425 F.2d 932 (3d Cir. 1970), cert. denied, 400 U.S. 831, 27 L. Ed. 2d 62, 91 S. Ct. 62; Top-All Varieties, Inc. v. Hallmark Cards, Inc., 301 F. Supp. 703 (S.D.N.Y. 1969); Potter's Photographic Applications Co. v. Ealing Corp., 292 F. Supp. 92 (E.D.N.Y. 1968).
The present record clearly indicates that there is no genuine dispute as to a material issue of fact. Indeed, plaintiff did not even see fit to file appropriate countervailing affidavits, but instead rested on the allegations in his complaint to establish a factual dispute for trial. Rule 56(e), F.R.C.P. makes it clear that "a party cannot rest on the allegations contained in his complaint in opposition to a properly supported summary judgment motion made against him." First Nat'l Bank of Arizona v. Cities Service Co., 391 U.S. 253, 289, 20 L. Ed. 2d 569, 88 S. Ct. 1575 (1968); Tripoli Co., Inc. v. Wella Corp., supra. There is no exception for anti-trust cases. Summary judgment in defendants' favor, therefore, is appropriate in the instant case.
Mindful of the warnings of Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 7 L. Ed. 2d 458, 82 S. Ct. 486 (1962), however, entry of summary judgment in defendants' favor will be withheld for a period of 90 days to afford plaintiff the opportunity to pursue discovery to refute the factual allegations of defendants' affidavits and to place upon the record factual support for the existence of a material issue of fact for trial.