Source: http://law.justia.com/cases/federal/appellate-courts/F2/711/714/302300/
Timestamp: 2013-06-18 21:02:53
Document Index: 365171975

Matched Legal Cases: ['§ 14', '§ 17', '§ 165', '§ 17', '§ 15', '§ 177', 'art. 2226']

711 F.2d 714: Gary Crossland, et al., Plaintiffs-appellees Cross-appellants, v. Canteen Corporation, Defendant-appellant Cross-appellee :: US Court of Appeals Cases :: Justia
Justia > US Law > US Case Law > US Federal Case Law > US Courts of Appeals Cases > F.2d > Volume 711 > 711 F.2d 714 - Gary Crossland, et al., Plaintiffs-appellees ...	NEW - Receive Justia's FREE Daily Newsletters of Opinion Summaries for the US Supreme Court, all US Federal Appellate Courts & the 50 US State Supreme Courts and Weekly Practice Area Opinion Summaries Newsletters. Subscribe Now
711 F.2d 714: Gary Crossland, et al., Plaintiffs-appellees Cross-appellants, v. Canteen Corporation, Defendant-appellant Cross-appelleeUnited States Court of Appeals, Fifth Circuit. - 711 F.2d 714
1 Only the Sherman Act claim was submitted to the jury. The Clayton Act requires that both the tying and the tied products be goods. 15 U.S.C. § 14 (1976); Kaiser Aluminum & Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1048-49 n. 5 (5th Cir.1982), cert. denied, --- U.S. ----, 103 S.Ct. 729, 74 L.Ed.2d 953 (1983); Advance Business Sys. & Supply Co. v. SCM Corp., 415 F.2d 55, 64 (4th Cir.1969), cert. denied, 397 U.S. 920, 90 S.Ct. 928, 25 L.Ed.2d 101 (1970). The alleged tying product here was the Canteen franchise, which is an intangible, not a good. The plaintiffs thus could not recover under the Clayton Act
2 In our discussion of the cigarette tie in part III.C infra, we note that the conditions of the alleged tie changed in July, 1975, when Garland acquired a tax-stamping machine for cigarettes. Even if this change of circumstances is viewed as the beginning of a new and separate tie, the 1973 DTPA remains the relevant version; the 1975 amendments did not become effective until September 1, 1975. Tex.Bus. & Com.Code Ann. § 17.45 (Vernon 1975)
3 Crossland argues that even if the corporations may not sue, he may sue derivatively for their injuries. This is incorrect: a derivative suit presupposes that the corporation has a right for the shareholder to enforce. See, e.g., National Bankers Life Ins. Co. v. Adler, 324 S.W.2d 35, 36 (Tex.Civ.App.--San Antonio 1959, no writ) (derivative action one where "stockholders bring suit for and on behalf of the corporation because the corporation has failed to bring the action"); 15 Tex.Jur.3d Corporations § 165 (1981) ("an action, if brought, must be brought by and in the name of the corporation"). Here, we have determined that the corporations have no right to recover
4 Naturally, since the plaintiffs may not recover damages for the alleged DTPA violations, they may not recover their attorneys' fees on those claims. Tex.Bus. & Com.Code Ann. § 17.50(b)(1) (Vernon 1973) (superseded) (prevailing consumer may receive reasonable attorneys' fees); Marcotte v. American Motorists Ins. Co., 709 F.2d 378, 381 (5th Cir.1983)
5 This would be true even if Crossland's belief had resulted from misrepresentations by Canteen about Texas law. The source of the coercion would still have been his understanding of state law, not Canteen's market power. See Photovest Corp. v. Fotomat Corp., 606 F.2d 704, 723-24 (7th Cir.1979), cert. denied, 445 U.S. 917, 100 S.Ct. 1278, 63 L.Ed.2d 601 (1980) (franchisor's false representations that its prices were lower than competitors' did not establish a tie because no use of economic power to coerce purchase)
6 As with the DTPA claims, supra note 3, the reversal of the antitrust judgment necessarily reverses the award of attorneys' fees on the antitrust claims. 15 U.S.C. § 15 ("Any person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws ..." may recover treble damages and attorneys' fees)
7 Canteen may be arguing that a special issue on contemporaneous intent not to fulfill a promise is required. If so, Canteen is incorrect. Dowling, supra (upholding verdict where no such special issue)
8 Canteen cites two cases for its tracing theory; both are totally inapposite. Southwest Battery Corp. v. Owen, 131 Tex. 423, 115 S.W.2d 1097 (1938), in fact, states the general rule that uncertainty of the amount of damages will not defeat a plaintiff's recovery. In Ada Oil Co. v. Dunlop Tire & Rubber Corp., 550 S.W.2d 129 (Tex.Civ.App.--Eastland 1977, no writ), the court reduced a damage award for lost car and truck tires because the lower court had found their value to be almost one-third greater than the uncontradicted evidence showed. Neither case even mentions tracing particular dollar losses to specific misrepresentations
9 The plaintiffs argue that the fraud and DTPA verdicts are not inconsistent (and also not duplicative) because they are for different causes of action. This argument overlooks the fact that a party may have suffered the same damages from each of two different wrongs. In such a situation, the plaintiff may recover the damages only once. Cf. Bradshaw v. Baylor Univ., supra (joint tortfeasors). The identity of the damages is the issue here
10 While the instructions on the DTPA did not expressly mention a reliance requirement, one is clearly implied by the instruction that the jury could only award damages of which the DTPA violation was a producing cause. See Royal Globe Ins. Co., supra (no damage caused where no reliance)
11 Canteen attempts to eliminate the foreseeability question by claiming that the instructions on proximate and producing cause were virtually identical. While it does not appear that the district court laid any particular emphasis on this element, foreseeability is included in the instruction on proximate cause but not in the instruction on producing cause. The jury could therefore have relied on the distinction
12 Because we vacate the award of actual damages for fraud, we also vacate the award of punitive damages. The plaintiffs argue that our affirmance of the liability finding authorizes us to affirm the punitive damage award, but Texas only permits punitive damages where actual, more-than-nominal damages have been awarded. Pan Am. Petroleum Corp. v. Mitchell, 338 S.W.2d 740, 743 (Tex.Civ.App.--El Paso 1960, no writ) ("[P]unitive or exemplary damages can only rest on and must depend upon actual damages."); 17 Tex.Jur.2d Damages § 177 (1960) ("[I]f a judgment for actual damages is unsupportable, an award of exemplary damages cannot stand.") The issue of punitive damages should also be retried
13 The plaintiffs also complain of the exclusion of certain evidence demonstrating the value of the equipment involved in the original sale-leaseback transaction. Since that evidence was not relevant to any issue in the case, it was not an abuse of discretion to exclude it. See Fed.R.Evid. 402 ("Evidence which is not relevant is not admissible.")
14 This is particularly true because the jury awarded the plaintiffs less than $42,000 of the over $200,000 claimed as undervaluation in the audit. Adding this amount to the audit figure still yields a final value for the business well below its pre-franchise value
15 The plaintiff must allege and prove that the contract claim was presented to the defendant at least 30 days before judgment was rendered. Tex.Rev.Civ.Stat.Ann. art. 2226 (Vernon Supp.1982); Edinburg Meat Prods. Co. v. Vernon Co., 535 S.W.2d 432, 437 (Tex.Civ.App.--Corpus Christi 1976, no writ)