Petition for Writ of Certiorari — Wood v. United States
Supreme Court brief1966
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Office-Supreme Court, WS
FILED
—
lb SEP 17 es
JOHN F. DAVIS, CLERK
In the
SUPREME COURT OF THE UNITED STATES
Ocroser TERM 0005 f DF gis
No. 58.2
WILLIAM RANCE AND RUTH V. RANCE,
Petitioners,
VERSUS
THE SPERRY AND HUTCHINSON COMPANY,
Respondent.
PETITION FOR A WRIT OF CERTIORARI TO THE
SUPREME COURT OF THE STATE OF OKLAHOMA
JOHN H. CANTRELL
2120 First National Building
Oklahoma City, Oklahoma
JAMES D. BATCHELOR
707 North Robinson
Oklahoma City, Oklahoma
Attorneys for Petitioners
September, 1965
UTTERBACK TYPESETTING Co.. 13 SO. WALKER. OXLANOMA City. Pu. CE S-S750
Srila Ni a Nic is Ba ce en
INDEX i
PAGE
Opinions Below 1
Jurisdiction 2
Questions Presented 2
Statutes Involved 3
Statement
Nature of the Proceeding
The Court of First Instance
The Appellate Court 14
Summary 17
Reasons for Granting the Writ 21
I. The S & H method of doing business constitutes
an illegal tying arrangement in violation of Sec-
tion 1 of the Sherman Act and Section 3 of the
Clayton Act 21
A. A sale by a licensee-retailer of merchandise
and S & H Stamps for a single price to a pur-
chaser is a “tie-in” sale where the purchaser
is prohibited from disposing of the stamps... 21
B. The tying arrangement involves a unique and
and substantial market 25
II. The tying arrangement is a restraint of trade and
substantially lessens competition 27
III. The licensing agreement creates a price-fixing
vertical combination in restraint of trade
Conclusion 31
caiililinnes
INDEX CONTINUED PAGE
CITATIONS
CASES:
Associated Press v. Taft-Ingalls Corporation, 340
F.2d 753 24
Black v. Magnolia Liquor Co., 355 U.S. 24 21, 24, 27, 28
Dr. Miles Medical Co. v. John V. Park & Sons Co.,
220 U.S. 373 29, 30
International Salt Co. v. United States, 332 U.S.
392 am ae
Jerrold Electronics Corp. v. United States, 365 U.S.
567 26
Mercoid Corp. v. Minneapolis-Honeywell Recorder
Co., 320 U.S. 680 26
Northern Pacific Railway Company v. United
States, 356 U.S. 1 26
Safeway Stores v. Okla. Retail Grocers’ Assoc., Inc.,
360 U.S. 334: 20, 22
Standard Fashion Co. v. Magrane-Houston Co., 258 ~~
US. 346 30
Standard Oil Co. v. United States, 337 US. 293... 26
United States v. Loew’s, Inc., 371 U.S. 38_______22, 23,
24, 26, 28
United States v. Paramount Pictures, Inc., 334 U.S.
131 26
United States v. Parke-Davis & Co., 362 U.S.29.._s_- 29
United States v. The White Motor Co., 194 F.Supp.
562 30
White Motor Co., The, v. United States, 372 U‘S.
253 30
—iii—
INDEX CONTINUED : PAGE
STATUTES:
Sec. 1 of the Sherman Anti-Trust Act of July 2,
1890, as amended, 15 U.S.C. § 1___18, 19, 21, 24, 25, 31
Sec. 3 of the Clayton Act of Oct. 15, 1914, 15 U.S.C.
§ 14 -18, 21, 24, 25, 31
APPENDICES
Appendix A: manele
Findings of Fact and Conclusions of Law ——i-vii
Appendix B:
Order Sustaining in Part and Overruling in Part
Motion to Modify and Supplement Findings of
Fact viii-ix
Appendix C:
Journal Entry of Judgment x-xi
Appendix D:
Opinion of the Supreme Court of the State of
Oklahoma xii-xxxviii
Appendix E:
Order Denying Rehearing XXXViii-xxxix
Appendix F:
Order Staying Issuance of Mandate —___Xxxix
In the
Supreme Court of the United States
OctToserR TERM, 1964
No. .....-..--
WILLIAM RANCE AND RUTH V. RANCE,
Petitioners,
VERSUS
THE SPERRY AND HUTCHINSON COMPANY,
Respondent.
PETITION FOR A WRIT OF CERTIORARI TO THE
SUPREME COURT OF THE STATE OF OKLAHOMA
William Rance and Ruth V. Rance, for themselves and
for the class denoted as customers of licensee-retailers of
The Sperry and Hutchinson Company, petition for a writ
of certiorari to review the decision of the Supreme Court
of the State of Oklahoma affirming the granting of an in-
junction against the Rances prohibiting them from buying,
selling, or exchanging trading stamps issued and dis-
tributed by The Sperry and Hutchinson Company.
OPINIONS BELOW
The Superior Court of Oklahoma County, State of
Oklahoma, filed the following opinions and judgment which
are not reported:
a
(1) Findings of Fact and Conclusions of Law
(2) Order Sustaining in Part and Overruling in Part
Motion to Modify and Supplement Findings of
Fact
(3) Journal Entry of Judgment.
These are printed in Appendices A to C, infra, pp. i-xi.
The opinion of the Oklahoma Supreme Court, affirm-
ing the granting of the injunction, is not yet reported; it
and other related orders are printed in Appendices C to F,
infra, pp. xii-xxxix.
JURISDICTION
The judgment of the Superior Court of Oklahoma
County granting a permanent injunction against William
Rance and Ruth V. Rance was affirmed by opinion of the
Oklahoma Supreme Court on April 13, 1965. The petition for
rehearing was denied by the Oklahoma Supreme Court on
June 22, 1965. The jurisdiction of this Court is invoked un-
der 28 U.S.C. § 1257 (3).
QUESTIONS PRESENTED
1. Whether the distribution of trading stamps to a
customer in a retail sale as required by agreement between
S & H and its retailer-licensees is an illegal tying arrange-
ment in violation of Section 1 of the Sherman Act and
Section 3 of the Clayton Act where the stamps are neither
transferable nor redeemable in cash but may only be ex-
changed for S & H merchandise.
2. Whether the licensee agreement between S & H
and its licensee-retailers creates a vertical price-fixing
combination in violation of Section 1 of the Sherman Act
by compelling the retailer to offer trading stamps at a fixed
a
rate equivalent to 2.8 per cent of his retail sales where the
retailer’s customers may neither transfer the stamps nor
redeem them in cash but may redeem them only for S & H
merchandise at redemption rates fixed by S & H.
STATUTES INVOLVED
Section 1 of the Sherman Anti-Trust Act of July 2,
1890, as amended, 15 U.S.C. § 1:
“Every contract, combination in the form of trust or
otherwise, or conspiracy, in restraint of trade or com-
merce atnong the several States, or with foreign na-
tions, is declared to be illegal: Provided, That nothing
contained in sections 1-7 of this title shall render
illegal, contracts or agreements prescribing minimum
prices for the resale of a commodity which bears, or
the label or container of which bears, the trademark,
brand, or name of the producer or distributor of such
commodity and which is in free and open competition
with commodities of the same general class produced
or distributed by others, when contracts or agreements.
of that description are lawful as applied to intrastate
transactions, under any statute, law, or public policy
now or hereafter in effect in any State, Territory, or
the District of Columbia in which such resale is to be
made, or to which the commodity is to be transported
for such resale, and the making of such contracts or
agreements shall not be an unfair method of competi-
tion under section 45 of this title: Provided further,
That the preceding proviso shall not make lawful any
ae aan
contract or agreement, providing for the establish-
ment or maintenance of minimum resale prices on any
commodity herein involved, between manufacturers,
or between producers, or between wholesalers, or be-
tween brokers, or between factors, or between re-
tailers, or between persons, firms, or corporations in
competition with each other. Every person who shall
‘ make any contract or engage in any combination or
conspiracy declared by sections 1-7 of this title to be
illegal shall be deemed guilty of a misdemednor, and,
on conviction thereof, shall be punished by fine not
exceeding fifty thousand dollars, or by imprisonment
not exceeding one year, or by both said punishments,
in the dis¢retion of the court.”
Section 3 of the Clayton Act of October 15, 1914, 15
US.C. § 14:
“It shall be unlawful for any person engaged in
commérce, in the course of such commerce, to lease
or make a sale or contract for sale of goods, wares,
merchandise, machinery, supplies, or other commodi-
ties, whether patented or unpatented, for use, con-
sumption, or resale within the United States or any
Territory thereof or the District of Columbia or any
insular possession or other place under the jurisdiction
of the United States, or fix a price charged therefor,
, or discount from, or rebate upon, such price, on the
condition, agreement, or understanding that the lessee
or purchaser thereof shall not use or deal in the goods,
wares, merchandise, machinery, supplies, or other
commodities of a competitor or competitors of the
lessor or seller, where the effect of such lease, sale,
or contract for sale or such condition, agreement, or
understanding may be to substantially lessen competi-
tion or tend to create a monopoly in any line of cor -
merce.”
=
STATEMENT
Nature of the Proceeding
On June 11, 1962, The Sperry and Hutchinson Com-
pany (S & H) filed suit in the Superior Court of Okla-
homa County, State of Oklahoma, against the petitioners
William Rance and Ruth V. Rance (the Rances) (R. 559-
571). The Rances operate a small trading stamp exchange
(R. 621). They buy, sell, and exchange trading stamps in-
cluding S & H stamps (R. 624). S & H sought an injunction
to prevent the Rances from trading S & H stamps (R. 562-
565).
_The Court of First Instance
S & H alleged that it:
“. .. grants to its merchant-licensees the exclusive
right to use the S & H service in their types of busi-
ness in their competitive or trade areas, and thereby
creates a ‘family’ of non-competing merchants .. .”
(R. 561).
The petition alleged that by reason of the license contracts
(Pl. Ex. 1A; R. 399-401):
“. . . title to the stamps remains in S & H ... that
the stamps are not transferable without the written
consent of S & H ... and that the only right which
the customer acquires in the stamps is to paste them in
the collector’s book and to present them to S & H for
redemption” (R. 560).
The petition further alleged that the Rances buy, sell and
exchange trading stamps including those of S & H (R.
le a) San) ee oe ed phe es Seay est ta, ‘
a eT
561), and that these activities of the Rances were causing
S & H irreparable harm. The petition prayed for perma-
nent injunctive relief (R. 562, 565).
The defendants’ Amended Answer presented the fed-
eral questions as a defense to the action by the following
allegation:
“Plaintiff is now, has been and threatens to continue
to be in violation of the public policies and statutes of
the United States of America in and in connection with
its interstate business and in and in connection with
its intrastate business, inextricably commingled, in
that by virtue of the facts, contracts and circumstances
alleged in plaintiff’s Petition it appears and must be
found that plaintiff was, now is and will continue to be
a member of and engaged in a combination and con-
spiracy in restraint of trade, in violation of the Sher-
man and Clayton Acts of the United States of America
and other related statutes, as wel) as contrary to
numerous decisions of the Supreme Court of the
United States” (R. 581).
The Amended Answer further prayed that S & H be
permanently enjoined from:
“(1) Continuing its monopolistic practices, con-
tracts, advertising and mode of operations as above
described; -
“(2) Suing, harassing or interfering with these de-
fendants in the operation and conduct of the business
of said William Rance; and
“(3) Hindering, admonishing or threatening any
Oklahoma member of the class of ‘customers of the
licensees’ of plaintiff in connection with the ownership,
control and disposition of his trading stamps issued by
plaintiff’ (R. 585).
SE + TB OEE Me mE AEE OLLI ee EE sn Oe, te aa: ty «ee
a
ves
=
The trial court’s Findings of Fact,;! Numbers 1 through
10, describe the parties’ methods of doing business:
“1. The plaintiff is a New Jersey corporation en-
gaged in the trading stamp business. It has been
engaged in this business throughout the United States
since 1896. It is qualified to do and has done business
in the State of Oklahoma since 1911 (R. 620).
“2. The parties have stipulated, with the Court’s
approval, to waive their claims and cross-claims for
damages, each against the other, up to the date of the
judgment herein, but each reserves the right to prove
such damages as pertinent to the equities involved in
the cause (R. 620).
“3. Plaintiff does an interstate business involving
its business activities in 47 states of the United States.
It is excluded from Kansas entirely by law. In Wash-
ington, Wisconsin and Wyoming it is required by law
to redeem its ‘cash discount’ stamps for cash. In 13
other states it is required to afford the customers of
its licensees options to take merchandise or cash (R.
620, 621).
100 Northwest 22nd Street, Oklahoma City, Oklahoma,
called the Trading Stamp Exchange (R. 621).
“5. In the conduct. of its business, the plaintiff
enters into license contracts with retail merchants
offering a variety of goods and services, and grants to
each licensee in a particular line of business the ex-
clusive right to its S&H Cooperative Cash Discount
System within his competitive area. S&H has over
70,000 licensees throughout the United States. It has
* The Findings of Fact and Conclusions of Law are set forth in their
entirety in Appendices A and B. o
tad dieedi&edi ee
a
approximately 1,000 licensees in the State of Okla-
homa, about 300 of which are in Oklahoma City (R.
621).
“6. Plaintiffs method of doing business throughout
at least 29 states of the United States and particularly
in Oklahoma, and as to the Oklahoma portion of its
interstate business and as to its intrastate business in
Oklahoma is substantially as follows (R. 621):
(1) Plaintiff contracts in writing with its li-
censees, who are usually vendors of merchandise or
services, some 70,000 in the United States and 1,000
in Oklahoma; 300 of which are in Oklahoma City,
Oklahoma, whereby it agrees, inter alia, to supply
S&H Green Trading Stamps to said licensees at
stipulated prices. These contracts, at least in most
instances in 29 states, including Oklahoma provide
that (R. 621):
(a) Title to the stamps is reserved in Sperry
and Hutchinson Company (R. 621);
(b) The stamps can only be redeemed if pasted
in a booklet of 1200 stamps and surrendered to
Sperry and Hutchinson Company at one of its
Redemption Centers (R. 622);
(c) The stamps can only be redeemed in mer-
chandise offered and provided by Sperry and
Hutchinson Company for such purpose in units
determined by Sperry and Hutchinson Company
at pricés (per unit) fixed by Sperry and Hutchin-
son Company (R. 622); and
« (d) During the calendar year 1961 S&H stamp
collectors redeemed merchandise from plaintiff’s
redemption centers located in Oklahoma of the
approximate retail value of $4,000,000.00, which
merchandise had a cost value to plaintiff of ap-
proximately $2,000,000.00 (R. 638, 639).
These contracts contain no commitment or cove-
nant of the licensees that they will furnish or de-
liver the booklets for pasting purposes to the cus-
tomer and such is not usually done until the cus-
tomer requests the booklet, at some later time, if at
all, after he has received Stamps (R* 622).
(2) Plaintiff provides ‘Redemption Centers,’ some
14 in Oklahoma, stocked with merchandise selected
by Sperry and Hutchinson Company which it offers
for redemption of stamps at retail prices fixed by
Sperry and Hutchinson Company and acquired by it
under contracts with its suppliers which it chooses
and at prices which it negotiates and determines (R.
622).
;
(3) Periodically, Sperry and Hutchinson Com-
pany composes, has printed, issues and distributes its
‘catalog,’ delivered to large numbers of the holders
of the stamps through plaintiff’s licensees, in and
by which Sperry and Hutchinson Company advises
what merchandise it has for redemption of stamps
and what the unit price for same is as determined by
Sperry and Hutchinson Company (R. 622).
(4) If, as and when booklets containing the re-
quired number of stamps are surrendered in plain-
tiffs specified units at plaintiff's rates, the merchan-
dise selected by the holder of the stamps, within
the limited offering by Sperry and Hutchinson Com-
pany, is delivered to the holder of the stamps (R.
623).
pe The plaintiff expends annually many millions of
dollars in extensive national and local advertising and
publicizing the desirability and the benefits of the
te
S&H service to S&H stamp collectors. This advertis-
ing has created extensive good will and public ac-
ceptance for the service. There are more than 33,-
000,000 S&H stamp collectors in the United States.
About 300,000 to 400,000 of these collectors live in
Oklahoma (R. 623).
“8. The front cover of the S&H stamp collectors’
book contains a notice that neither S&H stamps nor
collectors’ books are sold to S&H licensees, S&H stamp
collectors or any other persons and at all times the
title thereto is expressly reserved to S&H; that the
only right S&H stamp collectors acquire in S&H
stamps is to paste them into S&H stamp collectors’
books and present them to S&H for redemption; that
S&H stamp collectors must not dispose of S&H stamps
or collectors’ books or make any further use of them
without S&H’s consent in writing; that if S&H stamps
or collectors’ books are transferred without such con-
sent, S&H reserves the right to restrain their use by or
take them from the persons to whom they are trans-
' ferred and that the use of S&H stamps and collectors’
books is restricted to S&H licensees and their custom-
ers (R. 623).
“9. In one state, Kansas, plaintiff is prohibited by
,law from carrying on its business. In three others,
Washington, Wisconsin and Wyoming, plaintiff is re-
quired by statute to redeem the stamps in cash. In
Thirteen (13) other states the statutes require that
the stamps be. redeemed by plaintiff either in cash or
merchandise—at the option of the holder (R. 623, 624).
“10. The defe ts buy and sell S&H stamps, ex-
change S&H for other brands of trading stamps
and other brands of trading stamps for S&H trading
stamps, for a fee, and advertise by newspaper, radio
and other media that they conduct a trading stamp
exchange” (R. 624).
aatiiies
The trial court also found that “trafficking” in trading
stamps by the Rances caused irreparable harm to S & H
(R. 624, 625; See Findings of Fact 11-16, Appendix A,
p. v).
Under the license contract, a retailer-licensee pays
$2.80 per 1,000 stamps (R. 472)? and is required to offer
one stamp for each 10 cents of retail sales (Plaintiff's Ex.
1A, R. 399-401).
S & H is the oldest and largest trading stamp com-
pany (R. 432, 433). The business of S & H in Oklahoma
represents less than 1 per cent of its nationwide business
(R. 478, 479).
When the stamps are distributed to a customer of a
licensee-retailer, the customer is not told that he is not to
have title to the stamps, and no instances of a customer
being so advised at the time the stamps are delivered to
him are known (R. 353, 354). A witness for S & H did not
know of a single instance in advertising where the state-
ment was made that The Sperry and Hutchinson Company
reserves title to the stamps (R. 456).
A collector of S & H Green Stamps testified that she
did not know until the time the lawsuit was filed that
S & H claimed to reserve the ownership of the stamps (R.
537, 538). It was stipulated (R. 542, 543) that the Rances
had in court some eight or ten other witnesses and would
produce if necessary some 50 to 100 other witnesses who
would all testify to the same facts.
2 The price varies in three other geographical areas of the United
States (R. 471).
—12—
Following the presentation of evidence to the Superior
Court for Oklahoma County, State of Oklahoma, the federal
questions were urged to the court by the defendants’ re-
quests for findings of fact and conclusions of law (R. 601-
613). The following numbered requests, which were re-
fused by the court (R. 620-626; Appendix A) presented the
federal issues:
“REQUESTED FINDINGS OF FACT:
“No. 9. Plaintiff's mode and method of doing busi-
ness, including its licensee contracts with its licensees
constitute an arrangement amounting to a ‘combina-
tion’ vertical in design, character and scope whereby
plaintiff creates, secures ahd/or reserves unto itself
sole control of a large segment of trade in the United
States and particularly in Oklahoma. Under this combi-
nation and as part of it plaintiff has secured and con-
trols (1) the stamps issued by plaintiff's licensees, and
(2) the redemption merchandise selected by plaintiff
for delivery to the customers of its licensees at prices
determined solely by plaintiff. These are ‘tied’ together
by plaintiffs plan and in plaintiffs operations. The
plan thus contains a ‘tying’ agreement whereby the
contract between the customer and his vendor is ‘tied’
to the agreement between the plaintiff and its licensee.
Such customer cannot take the ‘cash discount’ from his
vendor without being ‘tied’ to buying plaintiff's mer-
chandise in its designated quantities at its prices (R.
606).
“No. 12. Plaintiffs method of operating including
the reservation of the title to the stamps, coupled with
the requirement that they be redeemed by the Sperry
and Hutchinson Company for merchandise selected by
it at prices determined by it, constitutes an illegal
and forbidden combination in restraint of trade and an
—13—
- arrangement monopolistic in character in violation of
the anti-trust laws of the United States, and the con-
tract which is part thereof sought to be applied to bind
customers of plaintiff's licensees is void as against the
public policy of the United States and separately of
the State of Oklahoma (R. 607, 608).
“REQUESTED CONCLUSIONS oF LAW
“No. 5. Since the contract provision, upon which
plaintiff relies to support its claim that customers of
plaintiffs licensees do not own the stamps delivered
to them by plaintiff's licensees, has been used and is
being used by plaintiff to establish, create and main-
tain a vertical combination in restraint of trade and
to diminish and lessen competition, same does not
bind those with whom defendants deal and may deal
in exchange, barter, disposal and acquisition of stamps
and there can be no interdiction against defendants
which prohibits their acquiring property or rights
which,said customers have a perfect legal right to pass
In response to the court’s refusal to adopt the re-
quested findings of fact and conclusions of law above set
forth (R. 620-626, Appendix A) the Rances filed exceptions
to the trial court’s Findings of Fact and Conclusions of Law
and moved to modify and supplement the findings of fact
(R. 614, 615). The court then entered an order sustaining
in part and overruling in part the combined motion, which
order was adverse to the Rances on the federal issues (R.
638, 639, Appendix B).
—l4—
The federal issues were again raised at the trial stage
by motions of the Rances for new trial (R. 617-619) which
set forth as the fifth ground in support of the motion, the
following:
“5. Each of said Conclusions of Law is contrary to
established law and to the Constitution and the Stat-
utes of the State of Oklahoma and to the Statutes of
the United States of America and controlling decisions
of the Courts predicated thereon...” (R. 618).
The motion for new trial was overruled.
On October 26, 1962, a judgment was entered against
the defendants permanently enjoining them from buying,
selling, trading, exchanging, or dealing in any other way
with S & H Green Stamps (R. 627, Appendix C).
The Appellate Court
On appeal to the Supreme Court of the State of Okla-
homa, the federal issues were presented by the Petition
in Error. Of the assignments of error presenting the fed-
eral questions, the following are set forth:
“17, The trial court committed error in not finding
the facts as requested in Defendants’ Requested Find-
ing of Fact No. 9... in that the uncontradicted evi-
dence and the law, State and Federal, required same”
(R. 9, 10). (See Requested Finding of Fact No. 9,
supra, p. 12.)
* * * * + *
“19. The Trial Court committed error in not find-
ing the facts as requested in Defendants’ Requested
Finding of Fact No. 12... in that the uncontradicted
=
evidence and the law, State and Federal, required
same” (R. 11, 12). (See Requested Finding of Fact
No. 12, supra, pp. 12-13.)
* * * * * *
“26. The Trial Court committed error in not mak-
ing, adopting and entering Conclusion of Law No. 5
as requested by Defendants, . . . in that the uncontra-
dicted evidence and the law, State and Federal, re-
quired same” (R. 17, 18). (See Requested Conclusion
of Law No. 5, supra, p. 13.)
On the merits, the brief of the Rances again urged the
federal issues (R. 23-100). There were two basic argu-
ments, First, it was argued by the Rances that:
“. . . The indisputable effect of the vertical combi-
nation or arrangement which is the heart and soul of
the Stamp Company’s business as it is done in Okla-
homa and in interstate commerce to supply its Okla-
homa licensees, results in and effectively uses a ‘tying
agreement’ to bind the customers of the Stamp Com-
pany’s merchant-licensees to buy also the redemption
merchandise from the Stamp Company” (R. 79).
Second, the Rances argued that the S & H licensee
agreements created an illegal vertical price-fixing combi-
nation: Ge |
“The purpose, intent and effect of each such ‘con-
tract’ is to place the Stamp Company in complete con-
trol and management of the operation from first to last
and thus (a) of the stamps (themselves articles of
commerce), and (b) of the redemption merchandise,
its market and price (4 million dollars retail sales
price against a cost of 2 million dollars in 1962 alone);
and (c) this results from a, ‘vertical combination’ or a
nition
system embracing numerous ‘vertical combination’ (all
with one aim, as stated) (R. 61).
& * * aa * a
. .. The accomplishment of the plaintiff's purpose
. and plan, as revealed by the evidence (not only to
exclude from the channels of commerce the trading
stamps which have been issued and delivered as ‘cash
discounts’ [See Safeway case hereinafter cited] and
thus to control the incidents of ownership of such
stamps but as well the delivery and price of ‘premium’
merchandise used in the redemption of such stamps)
crystalizes into one of the salient reasons for the plain-
tiffs unquestioned dominance and control of an in-
dustry which has become wide spread in its activity,
and so vital to the housewives of the country as to
clothe it with a public interest” (R. 76, 77).
The Oklahoma Supreme Court expressly ruled on the
federal questions (R. 246-268; Appendix D). In response
to the argument that the customers of a licensee are bound
by an illegal tying arrangment, the Court held:
“In the instant action, licensees do not purchase a
commodity but a service, and is not required to pur-
chase a ‘tying’ product” (R. 265).
4
In ruling on the contention that S & H created an illegal
vertical combination the Court concluded:
“In our opinion, and we so hold, that the method by
which plaintiT conducts its business in Oklahoma is
not in violation of our State and Federal Laws” (R.
266).
The decision of the trial court was affirmed by opin-
ion of the Oklahoma Supreme Court on April 13, 1965,
—_,
~
which is set forth in full in Appendix D, at pages xii
' i ae
The Petition for Rehearing dealt solely with the fed-
eral issues. Specifically, a rehearing in the case was sought
upon the following grounds:
1. Thé opinion rendered by this Court on April 13,
1965, would enforce and result in an illegal tying ar-
rangement in violation of Section 1 of the Sherman
Act and Section 3 of the Clayton Act and in contra-
vention of the decided cases of the United States Su-
preme Court.
2. The decision would sustain and enforce an il-
legal price-fixing vertical combination, which is in
violation of Section 1 of the Sherman Act.
3. Both the tying arrangement and the price-fixing
vertical combination have a substantial impact on
commerce and tend to restrain trade and lessen compe-
tition (R. 273, 274).
The Petition for Rehearing was denied on June 22, 1965
(R. 295).
On July 27, 1965, the Oklahoma Supreme Court stayed
issuance of the mandate pending perfection of appeal to
this Court (R. 308; Appendix F).
, SUMMARY in
*
The Sperry and Hutchinson Company (S & H) con-
ducts an interstate business in 47 states of the United .
States (R. 620, 621). The petitioners, William Rance and
Ruth V. Rance, operate a trading stamp exchange at 100
_
N.W. 22nd Street in Oklahoma City (R. 621); S & H seeks
to enjoin them from trading S & H stamps (R. 562, 565).
In three states, S & H is required by law to redeem
the trading stamps for cash only (R. 620, 621) and in 13
other states it is required by law to provide an option of
redeeming for either cash or merchandise (R. 620, 621).
In at least 29 states, including Oklahoma, S & H trad-
ing stamps are not redeemable for cash (R. 621). In these
states, S & H seeks to prevent free transferability by re-
serving title to the stamps (R. 621). The stamps may be
redeemed only for S & H merchandise at redemption rates
determined from time to time by S & H (R. 622).
Under the S & H license contract, a retailer pays $2.80
per 1,000 stamps (R. 472) and is required to offer one stamp
for each 10 cents of retail sales (Pl. Ex. 1A, R. 399-401).
The licensee-retailer is thereby compelled to distribute the
stamps at a fixed rate equivalent to 2.8 per cent of his total
sales.
This method of operation creates an illegal tying ar-
rangement in violation of Section 1 of the Sherman Act
(15 U.S.C. § 1) and Section 3 of the Clayton Act (15 U.S.C.
§ 14). The customer of a licensee-retailer pays a combined
price for retail goods and the trading stamps. The stamps
are not redeemable in cash (R. 622). By means of the
reservation of title, S & H attempts to prevent free transfer
of the stamps (R. 560). Consequently, a consumer only
obtains one right with the stamps, that is, the right to re-
deem for S & H merchandise (R. 623). By this arrange-
ment, S & H has tied the sales of its merchandise to the
—19—
sales of some 70,000 of its retailer-licensees in the United
States, including 1,000 in Oklahoma (R. 621). '
The prohibition against free transferability is an es-
sential element of this scheme. The restriction on transfer
has two effects:
1. Since a consumer may neither sell nor trade the
stamps, he is tied to S & H merchandise, and
2. The consumer must make further purchases in-
volving tied sales in order to realize any redemptive
value from the trading stamps.
The license contract provision (PL Ex. 1A, R. 399-
401) reserving title to the stamps is the heart of this tying
arrangement. The provision should therefore be held in-
valid and unenforceable against consumers and the Rances.
The S & H license contract and method of doing busi-
ness also constitutes a vertical price-fixing combination in
violation of Section 1 of the Sherman Act (15 U.S.C. § 1).
The price fixing occurs in two ways:
1. S & H not only determines the price charged to its
licensee-retailers for the stamps, but by the license
contract requires them to be offered or distributed
at a rate equivalent to 2.8 per cent of the retail
sales,
2. S & H reserves the right to fix the redemption rate
at any time prior to redemption. Since S & H pro-
hibits a consumer from selling, trading, or other-
wise disposing of the stamps, S & H is thereby en-
abled to fix the value of the stamps after the tying
sale has occurred.
Digi nae ecnin a
= =
By reason of the prohibition against transfer of the
stamps, S & H thereby assures the effectiveness of retro-
active price fixing.
This case calls into question the practices of the largest
trading stamp company (R. 432, 433) with its concomitant
impact on the Rances and on a large segment of the con-
suming public. In 1961, the year prior to the trial of this
cause, there were more than 33 million consumers who
were collectors (by choice or otherwise) of S & H trading
stamps (R. 623).
Indeed, this Court has recognized the economic im-
pact of the trading stamp industry. In Safeway Stores v.
Oklahoma Retail Grocers Association, Inc., 360 U.S. 334 at
338, the Court said:
“Trading stamps have had a checkered career in the
United States, but since World War II their popularity
has grown until now it is a reasonable estimate that
these multi-colored scraps of paper may be found in
almost half of America’s homes.”
But this Court has not passed on the precise questions here
presented. *
Despite the substantial impact of these practices on
the public, the only notice to the stamp collectors that they
may not dispose of the S & H stamps and that the stamps
are redeemable only in S & H merchandise is found on the
8 Violation of the federal anti-trust laws was a y suggested to
the Court in Safeway Stores v. Oklaboma Retail Grocers Association.
Inc., 360 US. 334 at 342, footnote 7, but the claim was not made
below.
’
a, )
inside front cover of the stamp collector’s books-{R. 353,
354, 456, 623).
Examined in the light of applicable principles, the de-
cision of the Oklahoma Supreme Court erroneously ap-
plied federal law. The injunction against the Rances sus-
tains an illegal contractual provision prohibiting transfer
of the stamps; a provision which is essential to the “tying
arrangement” and “price-fixing combination.” The decision
of the Oklahoma Supreme Court should therefore be re-
versed and S & H should permanently be enjoined from
further engaging in this method of operation and from
reserving title to the stamps which it issues.
REASONS FOR GRANTING THE WRIT
. I
The S & H method of doing business constitutes an ille-
gal tying arrangement in violation of Section 1 of the Sher-
man Act and Section 3 of the Clayton Act.
A. A sale by a _licensee-retailer of merchandise and S & H
stamps for a single price to a purchaser is a “tie-in” sale
where the purchaser is prohibited from disposing of the
stamps.
The classical example of an illegal tying arrangement
is the conditioning of the sale of one product to the pur-
chase of another. In Black v. Magnolia Liquor Co., 355 U.S.
24, at 25, this Court said:
“Tying agreements by which the sale of one com-
modity is conditioned on the purchase of another have
been repeatedly condemned under the anti-trust laws,
iis
since they serve no purpose beyond the suppression
of competition.”
Thus, a tie-in sale need not expressly exclude a dealer
from purchasing the products of another; it is enough that
there is a “block” price for two items. United States v.
Loew’s Inc., 371 US. 38.
In the instant case, a purchaser of goods from a
licensee-retailer pays a “block” price for the merchandise
and the S & H Green Stamps. The licensing agreement
provides that the licensee agrees: :
“To offer S & H cooperative cash discount stamps to
all customers making cash payments and when ac-
cepted to issue to the customers one of said stamps for
each 10¢ represented in such payments as a discount
in consideration of the payment of cash when made
either C.O.D. or, at the option of the Licensee, on or
before the 20th proximo, and only for redemption by
the Licensor” (Pl. Ex. 1A; \R. 399-401).
This provision requires the licensee to distribute one
stamp for each 10 cents of retail sales. Since the licensee
initially pays $2.80 per 1,000 for the stamps it distributes
(R. 472), the cost of the stamps represents 2.8 per cent of
the price for goods which the purchaser pays to a retailer-
licensee. To say that a purchaser might refuse to accept the
stamps does not derogate from the fact that he has paid a
combined price for the retailer’s merchandise and the
stamps.
The purchaser obtains only one right with such stamps,
and that is to obtain merchandise from S & H as a result
of the initial payment to a licensee-retailer (R. 623). This
—23—
situation falls within the ambit of United States v. Loews
Inc., 371 U.S. 38, in which the Court condemned contracts
compelling block sales of two films, that is, the sale or
lease of one film conditioned on the payment of a “block”
price for two films. It is no objection to the illegality of
the contract that the purchaser in such case might pay the
block price and yet refuse to accept or use the second film.
Likewise, in the present case, any ability of the purchaser
to refuse to accept the Green Stamps is no objection to the
fact that a block sale of two items takes place for a single
price.
The unusual aspect”of the practice questioned here is
that the tying sale takes place on an incremental basis.
Logically, the fact that the cost percentage of the-stamps
in a retail sale (on the order of 2 to 3 per cent) is small
and the S & H merchandise will not be obtained until
later, etal, should not relieve 5'& Ht of the prosetiption
against tying arrangements.
It is the action of S & H in irrevocably tying the pur-
chaser to the redemption of S & H merchandise which es-
tablishes the existence of an illegal tying arrangement in
this case. It might be said that if the purchaser were free
to give away, barter, or sell his Green Stamps, that this
situation might fall short of an illegal tying arrange-
ment. However, it is the very act of tying the purchaser
to the redemption of S & H merchandise by a prohibition
against transfer that brings this case squarely within the
type of activity condemned by the Sherman and Clayton
Acts and applicable decisions of this Court.
v7
\
—24—
Only the activities of the petitioners in buying, selling,
and exchanging trading stamps prevent the customer-
purchaser from being irrevocably tied to S & H merchan-
dise.
It was held by the Oklahoma Supreme Court that the
stamps do not represent articles in commerce, but rather
a service and that there was consequently no violation of
federal law (R. 265). Under the Sherman Act, this holding
is obviously error since the provisions of the Act apply
whether the stamps are classed as “articles in commerce”
or “services.” Associated Press v. Taft-Ingalls Corporation,
340 F.2d 753 at 758. Under the Clayton Act, the Oklahoma
Supreme Court rationale is apparent sophistry since the
merchandise offered by S & H clearly represents “articles
in commerce.” The right to obtain merchandise is the only
right that the collector of S & H stamps is permitted to
acquire by the S & H licensing agreement (R. 623).
The stamp thus represents a'‘contract right, at the very
least, and that right is to obtain merchandise from S & H
as a result of a prior payment of a “block” price to a
licensee-retailer for goods and the stamps. Whether the
stamps issued to a purchaser by a licensee-retailer are
“articles in commerce” is immaterial because the merchan-
dise ultimately obtained from S & H is clearly a “com-
modity” or an “article in commerce.” Therefore the tying
arrangement is subject to Section 1 of the Sherman Act
(15 U.S.C. § 1) and Section 3 of the Clayton Act (15 U.S.C.
§ 14). United States v. Loew’s, Inc., 371 US. 38; Black v.
Magnolia, 355 U.S. 24.
_<
In the normal situation, tying arrangements usually
involve only a single seller. However, tying arrangements
are condemned because of their anti-competitive effect,
and the fact that S & H achieves its unique tying arrange-
ment by contract with thousands of retailers (R. 621) will
not remove it from the sphere of condemned practices un-
der the anti-trust law.
Under the applicable authorities, a sale by a licensee-
retailer of merchandise and S & H stamps for a single price
to a purchaser constitutes a tie-in sale where the pur-
chaser is prohibited from disposing of the stamps and may
not redeem them for cash. This arrangement contravenes
Section 1 of the Sherman Act and Section 3 of the Clayton
Act.
B. The tying arrangement involves a unique and substantial
market.
The record establishes that S & H is the “bell wether”
of the trading stamp industry since it is the largest in the
United States (R. 432, 433). The tying arrangement is
effected by means of licensing agreements with 1,000 re-
tailers in Oklahoma and approximately 70,000 nationwide
(R. 621). S & H obtains its merchandise from manu-
facturers* and does business in 47 states (R. 620, 621).
S & H was found to be engaged in interstate commerce
(R. 620, 621). Without more, it is clear that a “not insub-
—26—
stantial” amount of interstate commerce is affected. North-
ern Pacific Railway Company v. United States, 356 U.S. 1,
at 6.
In addition to the magnitude of the operation of the
tying arrangements, the sale of merchandise offered by
S & H is tied to the sales of thousands of products offered
by the retailer-licensees, which products are both patented
and unpatented.® It is a fundamental proposition that
where any sales involve a tying arrangement with a
patented product such a sale is illegal per se without proof
of “sufficient economic power” or proof of the size of the
anti-competitive impact on the market. In United States
v. Loew’s, Inc., 371 U.S. 38, at 50, Mr. Justice Goupserc,
speaking for the Court, said:
“Appellants urge that .. . the fact that a few con-
tracts were found to be illegal does not justify the
entering of injunctive relief. We disagree. Illegality
having been properly found, appellants cannot now
complain that its incidence was too scattered to war-
rant injunctive relief.”
Thus the illegality of these tying arrangements insti-
tuted by S & H is clear even without consideration of the
magnitude of S & H’s economic power. Jerrold Electronics
Corp. v. United States, 365 U.S. 567; Standard Oil Co. v.
United States, 337 U.S. 293; United States v. Paramount
Pictures, Inc., 334 U.S. 131; International Salt Co. v. United
States, 332 U.S. 392; Mercoid Corp. v. Minneapolis-Honey-
well Recorder Co., 320 U.S. 680.
5 This Court is requested judicial of the commonly
paca Ses he ee sk et ns eo eee
= et
’ I
The tying arrangement is a restraint of trade and sub-.
stantially lessens competition.
Tying agreements are condemned under~-the anti-
trust laws “since they serve no purpose beyond the sup-
pression of competition.” Black v. Magnolia Liquor Co.,
355 US. 24, at 25. The requirement of S & H licensing
agreements which compels the licensee to offer one S & H
stamp for every 10 cents in merchandise purchased from
such retailer (Pl, Ex. 1A, R. 399-401) demonstrates the
size of the market obtained by these arrangements. These
agreements involve non-competitive retailers of which 1,000
are in Oklahoma alone and approximately 70,000 nation-
wide (R. 621). The retail value of the merchandise re-
deemed from S & H in Oklahoma in the year 1961 alone
was in excess of $4,000,000.00 (R. 638, 639). This figure
represents less than 1 per cent of the nationwide business
of S & H (R. 478, 479).
By prohibiting a purchaser from selling, trading or
disposing of the stamps, S & H effectively prevents a direct
market comparison between the value of the S & H mer-
‘Chandise represented by its stamps and the values offered
by any other stamp company. The tying arrangement oper-
ates to restrain trade and competition in the following
significant ways:
1. The arrangement prevents competition between
stamp companies in terms of redemption value. The
record reveals that there are only four other stamp
companies in Oklahoma (R. 625) and the attempted
restraint on disposition of stamps by a purchaser,
s except by means of redemption with S & H, limits
—_— =
the most effective form of market competition of
the merchandise values of S & H.
2. The tying arrangement results in a captive market
which by definition is substantially removed from
the area of competition. The captive market re-
sults from the tying sale in two ways:
a. Each tied sale is captive in itself, and
b. The tying arrangement necessitates further
purchases involving “tied” sales-in order for
the »urchaser to realize any redemptive value
for the stamps.
3. A tying arrangement tends to exclude other mer-
chandisers from markets which they might other-
wise have.
4. The tying arrangement allows S & H to obtain an
illegal advantage by tying the sale of its stamps and
thereby its merchandise to the sale by licensee-
retailers of thousands of well-known products sold
under trade names, trade marks, copyrights, and
patents, as well as deriving advantage from the
trade names and trade marks of licensee-retailers
themselves. These anti-competitive marketing re-
sults of tying arrangements have been restated by
this Court on numerous occasions and universally
condemned. United States v. Loew’s, Inc., 371 US.
38; Black v. Magnolia Liquor Co., 355 US. 24.
The tying arrangements therefore result in a signifi-
cant captive market for S & H which is substantially re-
moved from competition.
’ a: il
The licensing agreement creates a price-fixing vertical
combination in restraint of trade.
By the terms of the licensing contract S & H not only
establishes the price for the sale of the stamps to its
licensees, but also fixes the distribution of the stamps at
one for each 10 cents of retail sales (Pl. Ex. 1A, R. 399-
401). S & H thus fixes the cost of the ultimate disposition
of stamps to the purchaser at approximately 2.8 per cent
of the total amount of the retail purchase.
This Court said in Dr. Miles Medical Co. v. John V.
Park & Sons Co., 220 U.S. 373, at 409:
“The complainant having sold its product at prices
satisfactory to itself, the public is entitled to what-
ever advantage may be derived from competition in
the subsequent traffic.”
The licensing agreement, by fixing the rate of distribu-
tion of the stamps, effectively prohibits competition among
S & H licensee-retailers in offering S & H stamps. Like-
wise, it prevents competition between S & H licensees and
retailers who may offer other brands of trading stamps.
United States v. Parke-Davis & Co., 362 U.S, 29; Dr. Miles
Medical Co. v. John V. Parke & Sons, 220 U.S. 373.
_A second and more aspect of the price-fixing
practice is the fact that price of the products or mer-
chandise may ultimately be fixed after the tying sale has
occurred. The trial court found:
“The stamps can only be redeemed in merchandise
offered and provided by Sperry and Hutchinson Com-
— 30—.
pany in units determined by Sperry & Hutchinson
Company at prices (per unit), fixed by Sperry &
Hutchinson Company .. .” (R, 622).
Consequently, even if a retailer-licensee were to de-
part from the licensing agreement by distributing S & H
stamps at a rate other than one stamp per 10 cents of re-
tail sales, the power to fix the price of the redemption mer-
chandise has been retained by S & H. This means that once
a purchaser has obtained the stamps, he is assured of no
fixed value, since they are not redeemable in cash and, at
any time prior to redemption, S & H may change or fix the
redemption value of the stamps for which merchandise will
be delivered.
This unusually questionable arrangement lies some-
where in the realm beyond the practices considered in Dr.
Miles Medical Co. v. John V. Park and Sons Co., 220 US.
373, and in Standard Fashion Co. v. Magrane-Houston Co.,
258 U.S. 346. The criticism voiced by this Court in both
cases is apposite in that S & H not only determines the price
at which the stamps are distributed to its licensee-retailers
but also fixes the effective price at which they are dis-
tributed to consumers. This is accomplished by (1) fixing
the rate of distribution and (2) by fixing the redemption
value after the tying sale has occurred.
It is by means of the licensing agreement that the
vertical price-fixing combination is established and the
practice squarely falls within the ambit of the criticism
voiced by the courts. United States v. The White Motor
Co., 194 F Supp. 562. See discussion on the practice in The
White Motor Co. v. United States, 372 U.S. 253.
=
From the uncontroverted evidence, S & H has estab-
lished a vertical combination which results in fixing prices
and values on its merchandise after the purchaser has paid
for and received the stamps. Such an arrangement is
clearly proscribed as a restraint of trade under Section 1
of the Sherman Act (15 U.S.C. § 1).
CONCLUSION
The attempt by the Sperry and Hutchinson Company
to prevent free transfer of trading stamps after their distri-
bution to a customer in a retail sale violates Section 1 of
the Sherman Act (15 US.C. § 1) and Section 3 of the
Clayton Act (15 U.S.C. § 14). The prohibition on transfer
is integral to the scheme of S & H which creates an illegal
tying arrangement and an unlawful retroactive price-fixing
combination.
The decision of the Oklahoma Supreme Court errone-
ously applied the federal laws and thereby sustained a
method of operation actifig in restraint of trade.
The substantial impact of these practices on the con-
suming public and the Rances requires relief. The absence
of prior definitive decisions necessitates consideration of
these issues by the Court. Finally, the attempted restric-
tion on free transfer of trading stamps operates in such
flagrant opposition to federal law and the principles enunci-
ated by this Court that the lower court should be reversed.
The Rances respectfully pray that the injunction
against them be set aside and that the cause be reversed
ee
Teme
eo
and remanded with instructions to enter appropriate in-
junctive relief in petitioner’s favor.
Respectfully submitted,
JoHN H. CANTRELL
2120 First National Building
Oklahoma City, Oklahoma
JAMES D. BATCHELOR
707 North Robinson
Oklahoma City, Oklahoma
Attorneys for Petitioners
September, 1965
APPENDIX
¥ APPENDIX A
FILED
IN SUPERIOR COURT
Oklahoma County, Okla.
NOV 2 1962
Dale Smith, Court Clerk
By Deputy
IN THE SUPERIOR COURT OF OKLAHOMA COUNTY
STATE OF OKLAHOMA
THE SPERRY AND HUTCHINSON COMPANY, )
)
Plaintiff, )
).
-Vs- No. 368
)
WILLIAM RANCE AND RUTH V. RANCE, )
d/b/a TRADING STAMP EXCHANGE, )
)
)
FINDINGS OF FACT AND
CONCLUSIONS OF LAW
Upon the pleadings filed, the proceedings had and the
testimony and evidence adduced herein, and at the special
instance and request of the parties, the Court finds the
facts and states the conclusions of law as follows:
FINDINGS OF FACT
1. The plaintiff is a New Jersey corporation engaged
in the trading stamp business. It has been engaged in this
business throughout the United States since 1896. It is
qualified to do and has done business in the State of Okla-
homa since 1911.
[APPENDIX] 7
2. The parties have stipulated, with the Court’s ap-
proval, to waive their claims and cross-claims for damages,
each against the other, up to the date of the judgment
herein, but each reserves the right to prove such damages
as pertinent to the equities involved in the cause.
3. Plaintiff does an interstate business involving its
business activities in 47 states of the United States. It is
excluded from Kansas entirely by law. In Washington,
Wisconsin and Wyoming it is required by law to redeem its
“cash discount” stamps for cash. In 13 other states it is
required to afford the customers of its licensees options to
take merchandise or cash.
4. The defendants are individuals engaged in con-
ducting the business of a trading stamp exchange at 100
Northwest 22nd Street, Oklahoma City, Oklahoma, called
the Trading Stamp Exchange.
5. In the conduct of its business, the plaintiff enters
into license contracts with retail merchants offering a
variety of goods and services, and grants to each licensee
in a particular line of business the exclusive right to its
S&H Cooperative Cash Discount System within his com-
petitive area. S&H has over 70,000 licensees throughout the
United States. It has approximately 1,000 licensees in the
State of Oklahoma, about 300 of which are in Oklahoma
City.
6. Plaintiff's method of doing business throughout at
least 29 states of the United States and particularly in
Oklahoma, and as to the Oklahoma fortion of its inter-
state business and as to its intrastate business in Okla-
homa is substantially as follows:
(1) Plaintiff contracts in writing. with its licensees,
who are usually vendors of merchandise or services,
some 70,000 in the United States and 1,000 in Okla-
homa, 300 of which are in Oklahoma City, Oklahoma,
whereby it agrees, inter alia to supply S&H Green
— =
[APPENDIX}
Trading Stamps to said licensees at stipulated prices.
These contracts, at least in most instances in 29 states,
including Oklahoma provide that:
(a) Title to the stamps is reserved in Sperry and
Hutchinson Company;
(b) The stamps can only be redeemed if pasted
in a booklet of 1200 stamps and surrendered to
Sperry and Hutchinson Company at one of its Re-
demption Centers, and;
(c) The stamps can only be redeemed in mer-
chandise offered and provided by Sperry and
Hutchinson Company for such purposes in units
determined by Sperry and Hutchinson Company
at prices (per unit) axes by Sperry and Hutchin-
son Company;
These contracts contain no commitment or covenant
of the licensees that they will furnish or deliver the book-
lets for pasting purposes to the customer and such is not
usually done until the customer requests the booklet, at
some later time, if at all, after he has received stamps.
(2) Plaintiff provides “Redemption Centers,” some
14 in Oklahoma, stocked with merchandise selected by
Sperry and Hutchinson Company which it offers for
redemption of stamps at retail prices fixed by Sperry
and Hutchinson Company and acquired by it under
contracts with its suppliers which it chooses and at
prices which it negotiates and determines.
(3) Periodically, Sperry and Hutchinson Company
composes, has printed, issues and distributes its “cata-
log,” delivered to large numbers of the holders of the
stamps through Plaintiff’s licensees, in and by which
Sperry and Hutchinson Company advises what mer-
[APPENDIX] ag
chandise it has for redemption of stamps and what the
unit price for same is as determined by Sperry and
Hutchinson Company.
(4) If, as and when booklets containing the re-
quired number of stamps are surrendered in plaintiff’s
specified units at plaintiff’s rates, the merchandise se-
lected by the holder of the stamps, within the limited
offering by Sperry and Hutchinson Company, is de-
livered to the holder of the stamps.
7. The plaintiff expends annually many millions of
dollars in extensive national and local advertising and
publicizing the desirability and the benefits of the S&H
service to S&H stamp collectors. This advertising has cre-
ated extensive good will and public acceptance for the
service. There are more than 33,000,000 S&H stamp col-
lectors in the United States about 300,000 to 400,000 of
these collectors live in Oklahoma.
8. The front cover of the S&H stamp collectors’ book
contains a notice that neither S&H stamps nor collectors’
books are sold to S&H licensees, S&H stamp collectors or
any other persons and at all times the title thereto is ex-
pressly reserved to S&H; that the only right S&H stamp
collectors acquire in S&H stamps is to paste them into
S&H stamp collectors’ books and present them to S&H for
redemption; that S&H stamp collectors must not dispose
of S&H stamps or collectors’ books or make any further
use of them without S&H’s consent in writing; that if
S&H stamps or collectors’ books are transferred without
such consent, S&H reserves the right to restrain their use
by or take them from the persons to whom they are trans-
ferred and that the use of S&H stamps and collectors’
books is restricted to S&H licensees and their customers.
9. In one state, Kansas, plaintiff is prohibited by law
from carrying on its business. In three others, Washington,
Wisconsin and Wyoming, plaintiff is required by statute
me [APPENDIX]
to redeem the stamps in cash. In thirteen (13) other states
the statutes require that the stamps be redeemed by plain-
tiff either in cash or merchandise—at the option of the
holder, |
10. The defendants buy and sell S&H stamps, ex-
change S&H stamps for other brands of trading stamps and
other brands of trading stamps for S&H trading stamps,
for a fee, and advertise by newspaper, radio and other
media that they conduct a trading stamp exchange.
11. The defendants are not S&H licensees, nor has
S&H consented to their trafficking in its stamps. The
plaintiff has demanded that the defendants cease traffick-
ing in its stamps. The defendants have refused te do so.
12. S&H stamp collectors are familiar with the oper-
ation of the S&H system and with S&H’s requirement that
they must paste S&H stamps into S&H stamp collectors’
books before S&H will redeem them.
13. If S&H stamp collectors could obtain S&H stamps
from sources other than S&H licensees, the value of the
S&H service to S&H licensees would be substantially re-
duced.
14. The defendants’ trafficking in S&H stamps and
collectors’ books is injurious to the plaintiff’s business and
property in that it interferes with its right to select its
licensees, to maintain the value of its stamps, to control the
distribution and issuance of its stamps, and to provide a
system of promotional and advertising value to its li-
censees,
15. Plaintiff’s licensees are not prohibited by contract
from contracting with other stamp companies.
16. Four other major trading stamp companies are
engaged in business in Oklahoma and this competitive fea-
ture of the plaintiffs business has created the business
of defendants.
_—
[APPENDIX]
CONCLUSIONS OF LAW
1. Plaintiff’s licensee contracts and mode of operation
are not violative of the Anti Monopoly laws of the State
of Oklahoma (79 OSA 1, et seq.) nor void as an unlawful
purpose or contrary to public policy (15 OSA 104, 211 et
seq.)
2. The plaintiff by notice contained in its license
contracts, the pads in which it supplies its stamps to its
licensees and in its stamp collectors’ books has retained
title to its stamps and made them non-transferable.
3. The only right which S&H licensees have in S&H
stamps is to issue them to their customers pursuant t@ the
provisions of the S&H license contract. The only right
which S&H stamp collectors have in S&H stamps is to
transfer them to S&H for redemption in merchandise; the
collectors have no right to transfer them to any other per-
son, firm or corporation without the permission of S&H,
in writing. |
4. The defendants’ trafficking in S&H stamps consti-
tutes unfair competition, misappropriation of plaintiff’s
good will and unjustified interference with its contracts
with its licensees and with its stamp collectors.
5. The defendants’ trafficking in S&H stamps causes
and will continue to cause the plaintiff irreparable injury.
6. The plaintiff has no adequate remedy at law.
7. The plaintiff is entitled to the relief of permanent
injunction.
ee ee ee
_ =
[APPENDIX}
IT IS THEREFORE ORDERED that a judgment
granting injunctive relief be entered in accordance here-
with,
DATED this 26th day of October, 1962.
_ G. MICHAEL TAPP
Judge of the Superior Court
APPROVED AS TO FORM:
G. M. Fuller
Attorney for Plaintiff
Objections to inadequacy, incompleteness and insufficiency
reserved,
John H. Cantrell
Attorney for Defendants °
[APPEND!IX}
APPENDIX B
FILED
: IN SUPERIOR COURT
Oklahoma County, Okla.
NOV 26 1962
IN THE SUPERIOR COURT IN AND FOR
OKLAHOMA COUNTY
STATE OF OKLAHOMA
THE SPERRY AND HUTCHINSON
COMPANY,
Plaintiff,
)
)
)
)
)
-vs- ’ ) NO. S-368
)
WILLIAM RANCE and RUTH V. RANCE, )
doing business as TRADING STAMP _ )
EXCHANGE. )
)
Defendants. )
ORDER SUSTAINING IN PART AND OVERRULING IN
PART MOTION TO MODIFY AND SUPPLEMENT
FINDINGS OF FACT
On this 21st day of November, 1962, the Motion of
the defendants, William Rance and Ruth V. Rance, to
modify and supplement the Findings of Fact herein coming
on to be heard and the said defendants appearing by their
attorney, John H. Cantrell, and the plaintiff appearing by
its attorney, John L. Smith, the Motion is duly presented
to the Court.
* Upon consideration of said Motion and argument of
counsel thereon, the Court finds and orders that the
Findings of Fact made and entered by the Court in this
ss {APPENDIX}
cause and dated the 26th day of October, 1962, be, and the
Same are, amended and supplemented by the addition of
the following Finding of Fact inserted in Finding of Fact
No. 6.(1) as subparagraph (d), to-wit:
(d) During the calendar year 1961 S&H stamp col-
lectors redeemed merchandise ‘from plaintiff's re-
“ demption centers located in Oklahoma ofthe approxi-
mate retail value of 4 million dollars which merchan-
dise had a cost value to plaintiff of approximately 2
million dollars,
Plaintiff excepts and exception allowed.
The Court further finds and orders that each and
every other portion of said Motion of said defendants
should be and is overruled and denied and the defendants
allowed exceptions.
G. Michael Tapp
Judge’ of the Superior Court of Okla-
- homa County, Oklahoma and agreed
_ Special Judge of the District Court of
Oklahoma County, Oklahoma :
O.K. as to form:
John L. Smith
Attorney for Plaintiff
O.K. as to form:
John H. Cantrell
Attorney for Defendants,
.
[APPENDIX)
APPENDIX C
FILED
IN SUPERIOR COURT
Oklahoma County, Okla.
NOV 2 1962
Dale Smith, Court Clerk
By Deputy
IN THE SUPERIOR COURT OF OKLAHOMA COUNTY
STATE OF OKLAHOMA
THE SPERRY AND HUTCHINSON COMPANY, )
)
)
WILLIAM RANCE and RUTH V. RANCE, )
d/b/a TRADING STAMP EXCHANGE, )
)
)
JOURNAL ENTRY
This matter coming on for hearing this 5th day of
September, 1962, the plaintiff appearing in person and by
its counsel, G. M. Fuller and John L. Smith, of Fuller,
Smith, Mosburg & Davis, and the defendants appearing in
person and by their counsel, John H. Cantrell, of Cantrell,
Thompson, Douglass & Wilson, and the Court having ex-
amined the pleadings, heard the testimony of witnesses
sworn and examined in Open Court, heard the arguments
of counsel and made its Findings of Fact and Conclusions
of law, which have been filed herein, it is
ORDERED:
1. That the activities of the defendants in buying,
selling, trading and exchanging S&H Green Stamps causes
and will continue to cause the plaintiff irreparable injury;
—xi—
C[APPENDIX}
2. That the plaintiff has no adequate remedy at
law;
3. That the plaintiff is entitled to the relief of per-
manent injunction; and
agents, servants, employees or associates, or in any other
manner.
Dated this 26th day of October, 1962.
G. MICHAEL TAPP
Judge of the Superior Court
OK:
G. M. Fuller
Attorneys for Plaintiff
OK: As to form only.
John H. Cantrell
Attorneys for Defendants ~
To all of which the defendants herein objects which ob-
jections are overruled and exceptions allowed.
G. MICHAEL TAPP
[APPENDIX]
APPENDIX D
IN THE SUPREME COURT OF THE
STATE OF OKLAHOMA
- William Rance and Ruth V. Rance,
Plaintiffs in Error,
vs. No. 40,423
The Sperry and Hutchinson Company,
a corporation,
Defendant in Error.
SYLLABUS
1. The trading stamp business, as generally conducted in
the State of Oklahoma, when honestly conducted, is
not omens public policy, °
2. The issuance of trading stamps in the usual and custom-
ary manner in Oklahoma, constitutes a device for giving
a discount for cash; the one who receives such stamps
does not receive a cash discount, but a redeemable dis- ~
‘ count in merchandise (represented by stamps) for
paying cash.
3. A trading stamp when issued in the usual and custom-
ary manner does not constitute ordinary property, a
negotiable instrument or an article of commerce, as
those terms are generally used; but, in effect, is an
“instrument” employed by a trading stamp company
to conduct a business which is in the nature of a sale
to its licensees of a promotional or an advertising
service.
Ne eR ad
—xili—
(APPENDIX)
4. An inherent characteristic of a trading stamp business
requires that a trading stamp company maintain cer-
tain controls over the “instruments” employed in the
conduct of its business, whether such “instrument” be
trading stamps, contractual agreements, the merchan-
dise at its redemption center, or any other integral part
of its business, ae
5. Where a trading stamp company grants, by contract,
exclusive rights to retail merchant, who is engaged in
a particular line of business in a competitive area, to
issue its trading stamps, such method of operation
springs from business requirements and if it does not
prevent others from lawfully engaging in similar en-
terprises, does not restrain trade or create a monopoly,
which is against public policy, such method of oper-
ation is not in violation of any State or Federal laws
when honestly conducted.
6. Until a commercial arrangement, or a method of doing
business, reaches a Stage where the needs of the public
are restricted to the point where the public is exposed
to the evils sought to be prohibited by law, or such re-
striction is contrary to the genius of free government,
such arrangement, or method of doing business, is not
against public policy.
facts and circumstances, and each case must be con-
strued in the light of its own particular facts,
8. Where a trading stamp company is legally and honestly
conducting a trading Stamp business and has created
Party seeks to attract customers and build up his own
business by buying and selling such stamps, exchanging
them for other brands of trading stamps, exchanging
—xiv—
[APPENDIX]
other brands of trading stamps for such stamps and ap-
propriates the stamp company’s good will, without pay-
ment to or the consent of the trading stamp company;
and such party’s “trafficking” in such stamps, is in-
jurious to the trading stamp company’s business and
property, in that it interferes with its right to select its
licensees to issue its stamps, to maintain the value of
its stamps, to control the distribution and issuance of
its stamps, and to provide a promotional and adver-
tising value to its licensees; and the stamp company has
no adequate remedy at law; the stamp company is en-
titled to a permanent injunction enjoining said party
from “trafficking” in its stamps as articles of com-
merce.
9. The findings of the trial court should be strongly per-
suasive, and should not be set aside unless this Court
can say, in equity and good conscience, that the con-
clusions reached by the trial court are against the clear
weight of the evidence.
APPEAL FROM SUPERIOR COURT OF OKLAHOMA
COUNTY, OKLAHOMA
Hon. G. Michael Tapp, Judge.
The Sperry and Hutchinson Company, a trading
stamp company, commenced proceedings against plaintiffs
in error from “trafficking” in its stamps as articles of com-
merce. The trial court granted a permanent injunction as
prayed for and plaintiffs in error appealed from the order ~
overruling its motion for a new trial.
AFFIRMED
Cantrell, Douglass, Thompson & Wilson,
By John H. Cantrell,
2120 First National Building,
‘Oklahoma City 2, Oklahoma,
For Plaintiffs in Error,
ee ee
CAPPEND!IX}
W. J. Holloway,
G. M. Fuller,
Fuller, Smith, Mosburg, Davis & Bowen, ‘
2500 First National Building,
Oklahoma City 2, Oklahoma
Of Counsel:
Casey, Lane & Mittendorf,
26 Broadway,
New York 4, New York,
John F. Joyce,
Roger H. Lloyd
For Defendant in Error.
IRWIN, J.:
The Sperry and Hutchinson Company, referred to as
plaintiff, is engaged in the trading stamp business and by
written contract, it licenses the use of its S&H trading
stamp service to certain retail merchants, referred to as
licensees. The licensees offer and issue the stamps to their
customers when the customers purchase merchandise at
the licensees’ places of business. The customers who re-
ceive the stamps will be referred to as collectors,
William Rance and Ruth V. Rance, d/b/a Trading
Stamps Exchange, referred to as defendants, buy and sell
S&H stamps, exchange S&H stamps for other brands of
trading stamps, and exchange other brands of trading
stamps for S&H stamps., Briefly stated, defendants conduct
a business of “trafficking” in trading stamps.
Defendants are not licensees of plaintiff and plaintiff
has not consented to defendants’ “trafficking” in its stamps.
Plaintiff commenced this proceeding to permanently enjoin
defendants from “trafficking” in S&H stamps.
The trial court, in its journal entry of judgment, per-
manently enjoined defendants “from advertising or other-
—xvi—
[APPENDIX]
wise offering to buy, sell, trade or exchange,” and “from
buying, selling, trading or exchanging or dealing in any
other way with S&H Green Stamps, either in person or
through their agents, servants, employees or associates, or
in any other manner.”
The defendants have appealed from the order over-
ruling their motion for a new trial.
FACTS
The defendants buy and sell S&H stamps, exchange
S&H stamps for other brands of trading stamps and ex-
change other brands of trading stamps for S&H stamps, for
a fee, and advertise by newspaper, radio and other media
that they conduct a trading stamp exchange.
Plaintiff does an interstate business in forty-seven
states in the United States and has done business in Okla-
homa since 1911. In the conduct of its business, plaintiff
enters into license contracts with retail merchants (li-
censees) offering a variety of goods and services, and
grants to each licensee in a particular line of business
within a competitive area the exclusive right to offer and
issue S&H stamps. There are approximately 70,000 li-
censees throughout the United States and approximately
1,000 licensees in Oklahoma.
Plaintiffs method of doing business generally, and
particularly in Oklahoma, is as follows: It contracts in
writing with its licensees, whereby it agrees, inter alia, to
furnish the licensees advertising signs; to furnish for dis-
tribution by the licensee the collectors’ books which are
books in which the collector pastes his stamps; and to re-
deem the stamps when collected and presented as pre-
scribed. The licensee agrees to advertise the fact that it
issues S&H stamps; to pay a stipulated price for a certain
number of stamps; and to offer S&H stamps to all cus-
tomers making cash payments.
eb PN Real, peat :
—xvii—
[APPENDIX)
The collector’s books are offered to the collectors at
the licensee’s place of business. The stamps must be
pasted in a collector’s book before plaintiff redeems the
stamps for merchandise selected by the collector. The
stamp contains no language that title to the stamps remain
in the plaintiff or that the stamps are not transferable and
plaintiff's advertising does not so disclose, However,
printed on the inside of the cover sheet of the collector’s
book is the following:
“NOTICE
“S & H Green Cooperative Cash Discount Stamps
when redeemed in accordance with conditions printed
below are your compensation for cash payments made.
“All S & H Green Cooperative Cash Discount
Stamps now or hereafter issued by The Sperry and
Hutchinson Company are subject to wll the provisions
of the contracts between this Company and the mer-
chants who issue them, and the following rights and
conditions, which are expressly reserved by the Com-
pany, which the persons acquiring them expressly ac-
cept, and. which are a part of all contracts between this
Company and its merchants, and are binding on the
merchants’ customers,
“Neither the stamps nor the books are sold to mer-
chants, collectors or any other persons, at all times the
title thereto being expressly reserved in the Company,
and the right to possession thereof is reserved to it,
subject to the rights of the merchants and their cus-
tomers under the contracts with the Company. The
stamps are issued to you as evidence of cash payment
to the merchants issuing the same. The only right
which you acquire in said stamps is to paste them in
books like this and present them to us for redemption.
You must not dispose of them or make any further use
of them without our consent in writing. * * *.”
——
[APPENDIX]
“The stamps when received by you must be pasted
in the book, as that is the method we have adopted for
the purpose of preventing their further use. The use
of our stamps is restricted to our merchants and their
customers.”
A catalogue, known as an “Ideabook,” is available at
the licensee’s place of business for the collectors. The
“Tdeabook” contains pictures of the merchandise available
at plaintiff's redemption centers and the number of col-
lector’s books filled with stamps necessary to acquire the
desired merchandise.
The plaintiff and its licensee agree that title to the
stamps shall remain in plaintiff and shall not in any event
pass to the licensee or any other person or firm and that
the license to issue the stamps is personal to the licensee
and that it may not be transferred or assigned.
The contracts between the plaintiff and its licensee
does not prohibit the licensee from contracting with other
stamp companies to issue the other company’s stamps.
Plaintiff provides “redemption centers” and has ap-
proximately 14 in Oklahoma. The plaintiff spends millions
of dollars annually in extensive national and local adver-
tising, publicizing the desirability and the benefits of the
S&H service to S&H stamp collectors and there are more
than 33,000,000 S&H stamp collectors in the United States
and between 300,000 to 400,000 in Oklahoma.
In the trial court’s order sustaining in part and over-
ruling in part defendants’ motion to modify and supple-
ment findings of fact, the trial court found that during the
calendar year 1961, S&H stamp collectors redeemed mer-
chandise from plaintiff's redemption centers located in
Oklahoma of the approximate value of 4 million dollars
which merchandise had cash value to plaintiff of approxi-
matcly 2 million. In. this connection, the trial court made
no finding as to plaintiffs cost of operation in Oklahoma.
ee a een OE en
—xix—
[APPENDIX]
PROPOSITION I
Defendants contend that any collector, who acquires
stamps through purchase of merchandise or payment there-
for, acquires the title of such stamps and an attempted
restraint of alienation is unenforceable; that if such col-
lector has the title and ownership with the necessary inci-
dents thereto, including the right of transfer, defendants
have the right to acquire the stamps from the collectors;
and if the collector has the right to sell or exchange them,
defendants have the right to acquire, sell or exchange
them.
In this connection, defendants argue that the stamps
are “articles of commerce” and the attempted reservation
of title by plaintiff, in its contracts with its licensees, is a
“restraint of trade”; and since the stamps represent a “cash
discount” they become immediately “articles of commerce”
when issued the same as warehouse receipts, promissory
notes or other commercial paper.
Plaintiff argues that it retains title to the stamps and
the only rights a collector has in the stamps are for re-
demption purposes, and that it is entitled to an injunction
enjoining defendants from “trafficking” in its stamps.
gia
manner, constituted “a device for giving a discount for
cash.” In other words, a collector does not receive a “cash
discount,” but receives a redeemable discount in merchan-
dise (represented by stamps) for paying cash. The issue
involved here is whether defendants may be enjoined from
“trafficking” in the redeemable discounts (the stamps) as
[APPENDIX]
articles of commerce, which a collector receives from a
licensee.
Defendants cite the case of Merchants’ Legal Stamp
Company v. Murphy, 220 Mass. 281, 107 N.E. 968, as a
“bay horse case” to support their theory that when the
stamps are issued, they become “articles of commerce” and
that plaintiff is not entitled to an injunction enjoining
them from “trafficking” in “articles of commerce.” The
first headnote in the above case states:
“Trading stamps and books are ‘articles’ within St.
1908, c. 454 § 1, providing that every agreement in
violation of common law is illegal and void, if thereby
a monopoly in the production or sale of any article or
commodity tends to be created.”
Although the above case holds that trading stamps
are “articles” within the cited statute, an examination of
the opinion and the second headnote discloses that the
method employed by the stamp company in conducting its
business was the controlling factor. In the second headnote
it is stated:
“Where the direct and intended effect of methods
employed by plaintiff in conducting a business in
trading stamps was to prevent others from lawfully
engaging in similar enterprises, the contract of the
plaintiff with defendant as to use of stamps which em-
bodied such monopolistic features of the plaintiff’s
business was within St. 1908, c. 454, § 1, providing that
every agreement in violation of common law, in that
thereby a monopoly in the production or sale of any
article or commodity is created, is illegal and void.”
In the above case it is stated that under the stamp
company’s operation, it controlled nearly ninety per cent
of the actual stamp business in the Boston area. The stamp
company would decline to supply stamps unless its li-
censees would stipulate that they would not use trading
—xxi—
[APPENDIX]
stamps issued by other stamp companies, and the court
found that this provision was to suppress all competition
and said: “The monopoly it seeks to establish may not be
complete but it has gone far enough to eliminate any ef-
fective rivalry. The restriction is not confined to the sale
or transfer to a business rival of plaintiff, but the merchant
or collector cannot dispose of book or stamps to anyone
even if their retention unused must result in pecuniary
loss. Indeed this is an essential and controlling feature of
the contract, which differs materially from the contract in
Gagnon v. Sperry & Hutchinson Co., 206 Mass. 547, 92 NE
761.”
In the instant case the trial court found that there
are four other major trading stamp companies in Okla-
homa and this competitive feature of plaintiff’s business
has created the business of defendants. This finding is not
against the clear weight of the evidence. In other words,
plaintiff's method of operation does not prevent others
from engaging in similar enterprises for in Oklahoma there
are five major trading stamp companies and the stamp
business in Oklahoma is competitive.
In the instant case, plaintiff’s licensees are not pro-
hibited from contracting with other stamp companies—
there, the licensees were prohibited. The contract in the
instant action provides that upon termination thereof the
plaintiff “shall repay to the licensee any amount thereof
paid by him, for its services and for the use of its system,
measured by the number of stamps remaining unused and
so returned, * * *.” In the Merchants’ Legal Stamp Com-
pany case, the licensee could not dispose of the stamps to
anyone, even if their retention resulted in a pecuniary loss.
The method by which Merchants’ Legal Stamp Com-
pany conducted its business in Massachusetts was monopo-
listic. In Sperry & Hutchinson Co. v. McBride, 30 NE 2d
269, the Supreme Judicial Court of Massachusetts, in ef-
fect, recognized the legality of the method by which plain-
—
[APPENDIX)
tiff was conducting its stamp business. As will be herein-
after shown, plaintiff's method of conducting its business
in Oklahoma is not monopolistic or in violation of any State
or Federal Laws.
In Sperry & Hutchinson Co. v. Mechanics’ Clothing
Co., 135 Fed. Rep. 833, it was held that Sperry & Hutchin-
son had the right to restrict the use of the stamps by con-
tract, and the stamps, having been once issued by a mer-
chant, were functus officio, except for redemption, and,
though transferable for that purpose, defendants’ use
thereof was improper interference with Sperry & Hutchin-
son’s business, which it was entitled to restrain. In that
case the court said:
“The trading stamp, when issued, represents a
closed transaction between the merchant and the com-
pany, as well as an outstanding obligation to redeem
the stamp. As a token or voucher of the sale and use
of so much advertising, the trading stamp is neces-
sarily a consumable article—an article designed for a
single use in an advertising scheme. What the de-
fendants wish to do is to procure for themselves a
trade advantage as distributors of trading stamps. Al-
though the stamps have been issued to collectors for a
limited purpose, the defendants desire to use them for
a purpose for which obviously they were not intended
in the hands of a collector. * * *. The defendants have
devised the scheme of procuring from individual col-
lectors a very large number of the stamps, and, by
uniting in a single hand what ordinarily would be dis-
tributed in many hands, they secure a supply sufficient
for -advertising purposes. In other words, as trans-
ferees of the rights of persons who did not acquire
these stamps for advertising purposes, they secure for
themselves the ability to do what is not intended that
a collector of the stamps should do. * * *. By reusing
the stamps as an advertisement, they seek to get for
,
eee ee Oe ee ee ae eS eS a ee ee ee ee
—Xxili—
[APPENDIX]
nothing what others are required to pay for, and insti-
tute a destructive competition with authorized mer-
chants, which tends to destroy the value of the stamps,
and to injure the complainant’s (Sperry & Hutchin-
son) business.”
Defendants’ counsel argued the above case on the
theory that the court could disregard entirely the rights of
Sperry & Hutchinson and its licensee, and that, “although
both of these parties have expended their money in ex-
pectation of a benefit, this benefit may be destroyed by de-
fendants.” In turning down this contention, the court said
that defendants could acquire no greater rights than the
customer-collector had, and that if they did reissue them,
they were appropriating for themselves, and without con-
sideration, what fairly belonged to the licensee and Sperry
& Hutchinson. The court stated that a trading stamp is not
ordinary property. It is sui generis and an artificial cre-
ation. And we find this statement: “While a transfer of
ordinary property by the owner upon any terms usually
deprives other persons of no rights, this is not always the
case with the trading stamps. While it may be transferred
in any way which confines its use within the purpose for
which it was issued, it may not be transferred in such a
way as to destroy its value as an instrument of special
trade advantage or advertising, or as to deprive the com-
pany which created the value of the stamp, and which has
assumed the obligation to redeem it, of its right to com-
pensation for expenditures and for redeeming the stamps.”
In the above case the court found that defendants
knew that the stamps were issued to customers for a cer-
tain purpose—that is, for redemption. Defendants in the
instant action have knowledge of the method by which
plaintiff conducts its business,
In Sperry & Hutchinson vy. Temple, 137 Fed. Rep. 992,
defendant Temple knew of the mannez in which Sperry &
—xxiv—
[APPENDIX]
Hutchinson conducted its business and the court held Tem-
ple was not an innocent purchaser without notice in pur-
chasing issued stamps for resale. The court further held:
“The business of issuing trading stamps to mer-
chants to be given to purchasers of small bills for cash
redeemable in articles of merchandise, etc., when
honestly conducted, is not contrary to public policy.
“Where defendant purchased complainant’s trading
stamps, among others, for resale, and such purchases
seriously interfered with complainant’s business in
issuing such stamps for redemption in articles of mer-
chandise, etc., complainant was entitled to an injunc-
tion prohibiting defendant from advertising that he
would purchase complainant’s stamps, and from
selling stamps so purchased as articles of merchan-
dise.”
In the above case the Court said: “* * * The nature
of the business requires that there should be a certain
monopoly. If the stamps were on the market generally,
thus opening the business extensively, no merchant would
have an inducement to deal with the complainant. There-
fore, by the very nature of the business, the stamps are not
intended to be dealt with by the public generally, and are
not transferable in the general and ordinary sense of the
wee. * °°"
In Sperry & Hutchinson Co. v. Louis Weber & Co.,
161 Fed. Rep. 219, the court held:
“Complainant issued trading stamps to merchants
under contracts providing that they should be given
out only to cash customers as premiums on purchases,
and when presented by such customers in books would
be redeemed by complainant in goods. They were non-
transferable on their face, and the books were sup-
plied by complainant and contained advertisements of
the merchant’s business. Held, that the business and
DAE AOS),
—xxv—
[APPEND!IX}
contracts were lawful, and that complainant was en-
titled to protection by injunction against a rival in the
business, which sent out agents to purchase or ex-
change its own stamps for partly filled books con-
taining complainant’s stamps, some of which were
again resold at a low price, materially interfering
with complainant’s business.”
In the body of the opinion we find this language:
“It is the essence of complainant’s business that its
subscribers shall get the full benefit of its methods of
advertising and assistance. Its stamps are not, in the
fyll sense, property. Their nontransferability is an
essential element of their value, both to complainant
and its subscribers. It may be assumed that both par-
ties are in the transaction for profit. It is not fair to say
that complainant’s only interest consists in the presen-
tation of the stamps for redemption, if the means em-
ployed to that end result in killing the demand of
subscribers for the stamps. The parties are entitled to
carry on their affairs in such a way as to serve the
business interests of each, so long as they are law-
fully conducted. To create an unfair market for partly
filled and nontransferable.stamp books would have a
tendency to keep purchasers from trading with sub-
scribers until they were filled. This has been held in
a number of cases instituted by complainant to protect
its business. Among these are the Cases of Mechanics’
Clothing Company (C.C.) 128 Fed. 800, 1013 (same in
(C.C.) 135 Fed. 833), Brady (C.C.) 134 Fed. 691, Beal
(C.C.) 145 Fed. 659, Asch (C.C.) 145 Fed. 659, and
Temple (C.C.) 137 Fed. 922. In addition there are
unpublished opinions and decisions to the same effect
by Judge Morris of Baltimore, Judge McPherson, East-
ern district of Pennsylvania, Judge Thomas, Eastern
district of New York, and Judge Lacombe, Southern
district of New York.”
—xxvi—
[APPENDIX]
In Sperry & Hutchinson v. Fenster, 219 Fed. Rep. 755,
an injunction was granted in favor of Sperry & Hutchinson,
and in granting such injunction, the court held:
“Act Cong. October 15, 1914, c. 321 § 3, 38 Stat. 731,
prohibiting the making of a contract fixing the price
for merchandise on condition that the lessee or pur-
chaser shall not use or deal in the merchandise of a
competitor, if the effect of the contract is to substan-
tially lessen competition or tend to create a monopoly,
does not prohibit a trading stamp concern from re-
stricting redemption privileges to subscribers under
contract with it binding such customers to distribute
stamps only to customers.”
In the body of the opinion we find this statement:
“* * * the sale of trading stamps is much more like
the transactions considered in Henry v. A. B. Dick
Co., 224 US. 1, 32 Sup. Ct. 364, 56 L.Ed. 645, Ann. Cas.
1913D, 880, in that the reason for insisting upon a con-
tract is to restrict the sharing in a certain legitimate
privilege, to those who pay for the privilege, and to
prevent, by a mere transfer of the trading stamps, the
bestowal of the advantage of giving out the stamps,
and of getting trade thereby, upon any person who
might by holding the stamps be entitled to claim the
rights of redemption.
“It is evident that the intent and acts of persons
taking the stamps and seeking to redeem them for a
certain premium, and also the resultant benefits to that
person, are entirely different and are based upon sub-
stantially different rights from those of a party who
is seeking to attract customers and to build up his own
trade through the privilege of dealing, as it were, in
trading stamps, without payment for that privilege and
with no intention of getting the goods for which the
stamps are redeemable.
ee eee ee ee ee ee ae as
—_
[APPEND!X}
“The right to redeem the stamps is a property right
transferable by possession while the license to use
them for advertising purposes is not transferable with-
out compensation to the person granting that right,
viz., the plaintiff herein.” (emphasis ours).
In the instant action, defendants are seeking to attract
customers and to build up their own trade through the
“trafficking” in plaintiff’s trading stamps, without payment
for that privilege and without intention of getting the goods
for which the stamps are redeemable.
In Sperry & Hutchinson Co. v. Siegel, Cooper & Co.,
140 NE 864, the Supreme Court of Illinois said that stamps
‘were not negotiable instruments and the “purpose of the
provision concerning their redemption was to aid the one
who issued them in establishing a closer and continuous
relation between himself and his customers by having the
customers redeem the coupons. No one else has any right
to traffic in these stamps. By numerous cases in this
country, by which appellant here sought to enforce the
nontransferability of such stamps, such feature has been
sustained.” The court then cited the Weber Mechanics
Clothing Co. and Fenster cases herein before discussed.
the State commenced proceedings against the stamp com-
pany to require escheat of the cash value of unredeemed
stamps. The Superior Court, Chancery Division, 49 N.J.
Superior Ct. 165, 139 A2d 463, rendered judgment for the
Stamp company. On appeal to the Appellate Division, 153
A2d 691, in affirming the judgment, the court recognized
the fact that a housewife may redeem in her own book all
of the stamps collected by individual inembers of her
family and said the State’s rights are no greater than that
of each stamp holder. However, the court said the stamps
were not freely transferable without the Stamp company’s
consent because the collector is so apprised both by legend
[APPENDIX)}
on the reverse side of the stamps and by the “notice” in
the stamp books. The above decision was affirmed by the
New Jersey Supreme Court in 31 N.J. 385, 157 A2d 505,
for the reason stated in 153 A2d 691.
In the instant action, plaintiff and defendants submit
and rely upon diametrical theories. Plaintiffs theory is
that it has title to the stamps at all times, and since it has
title to them, the same may not be sold or exchanged with-
out its consent; and, the only rights a collector has in trad-
ing stamps issued to him by a licensee is the right of re-
demption and if a collector should transfer his right of re-
demption to another person without its consent, plaintiff
would not be obligated to redeem the stamps. On the other
hand, defendants’ theory is that after the trading stamps
have been issued by a licensee to a collector, such stamps
immediately become articles of commerce and can be sold
and exchanged as ordinary property; that plaintiff has no
interest in the stamps after the same have been issued to a
collector, but only an obligation of redemption; and since
plaintiff has no interest, but only an obligation to redeem,
it can not enjoin the sale and exchange of the stamps as
ordinary property or articles of commerce.
In analyzing the stamp cases we find the courts have
recognized that one of the inherent and necessary char-
acteristics of the trading stamp business requires that a
stamp company maintain certain controls over the trading
stamps and that its interest in the stamps after the same
have been issued to a collector is more than an obligation
to redeem. In other words, the courts. have recognized
that if trading stamps when issued in the ordinary and
usual manner, immediately become ordinary property and
could be sold and exchanged as such, such uses would be
so inconsistent with the purposes for which the same were
issued, and so destructive to a legal method of doing busi-
ness, that such action should be enjoined.
—xxix—
[APPENDIX]
We can only conclude that trading stamps, when issued
in the ordinary and usual manner to a collector, do not
constitute ordinary property or articles of commerce as
those terms are generally used; but, in effect, is an “instru-
ment” employed by a stamp company in conducting a
business whichis in the nature of a sale to its licensees of
a promotional or an advertising service. The issue herein
is whether plaintiff is entitled to an injunction enjoining
the defendants from trafficking in S&H Stamps or the
“instruments” employed by plaintiff to conduct its business
as articles of commerce.
The trial court found that if S&H stamp collectors
could obtain S&H stamps from sources other than S&H
licensees, the value of plaintiff's service to S&H licensees
would be substantially reduced; that defendants’ trafficking
in S&H stamps and collector’s books is injurious to plain-
tiffs business and property in that it interferes with its
right to select its licensees, to maintain the value of its
stamps, to control distribution and issuance of its stamps,
and to provide a promotional and advertising value to its
licensees; and that four other major trading stamp com-
panies are engaged in business in Oklahoma and this
competitive feature of plaintiff's business has created the
business of defendants.
In its conclusions of law the trial court found that de-
fendants’ trafficking in S&H stamps constitutes unfair
competition, misappropriation of plaintiffs good will and
unjustified interference with its contracts with its licensees
and with stamp collectors.
We find the success of plaintiff's business depends
upon the value of its services to its licensees and the num-
ber of stamps issued. Plaintiff, in its contract with its
licensees, is obligated to advertise that its licensees issue
S&H stamps; to advertise the benefits that the customers
will receive by purchasing from the licensees; to furnish
[APPENDIX] _
collector’s books; and to redeem the S&H stamps when
collected and presented.
Plaintiffs contract with its licensees prohibt the
licensees from disposing of the stamps in any manner other
than as provided in the contract and the license to issue
the S&H stamps is personal to the licensee and may not be
transferred or assigned.
The contract right to offer and issue S&H stamps by
the licensees and plaintiffs discharge of its obligations un-
der its contract are, in effect, an advertising device which
is beneficial to the licensees; the offering and issuing the
S&H stamps is not merely to induce a single purchase but
to provide an incentive for continued patronage, and the
offering and issuing S&H stamps are inducements and in-
centives for trading at a licensee’s place of business.
We find that if collectors could sell or purchase S&H
stamps on the open market for cash, or could obtain such
stamps from any and all retailers, whether such retailers
had or did not have a license from plaintiff to offer and
issue S&H stamps that the value of plaintiff's services to
its licensees would be reduced; that it would reduce the
tendency of a collector to patronize a licensee’s place of
business if one of the incentives was to obtain S&H stamps;
that the value of plaintiff’s services to its licensees (value
of the stamps) would not be determined by contract be-
tween the plaintiff and its licensee, but would be deter-
mined by market conditions created by people unauthorized
to traffic in S&H stamps but who do traffic in the same; and
that plaintiff and its licensees have expended great sums of
money to create a demand for S&H stamps and have cre-
ated a means whereby the collectors can receive a benefit
by patronizing a licensee who offers and issues_.S&H
stamps. Plaintiff has also created the good will in connec-
tion with its stamps and defendants have appr: sriated this
good will without the consent of and against the wishes of
plaintiff.
—xXxXxKi—
[APPENDIX)
We can only conclude that the trial court’s findings
are not against the clear weight of the evidence and that
defendant’s actions, by trafficking in S&H stamps, as arti-
cles of commerce, constitutes a wrongful and unwarranted
interference with plaintiff’s business.
In 28 Am. Jur., Injunctions, Sec. 70, page 566, it is
said that, “The right to conduct a business, * * * without
the wrongful interference of others is a property right
which equity will, in a proper case, protect by injunction,
by law.” In Paramount Pictures, Inc., v. Leader Press, Inc.,
106 F.2d 229, the court said that, “* * * the right to carry
on a lawful business is a valuable right which a court of
equity will protect against unwarranted interference or
undue obstructions.” And, “* * * a court of equity will
extend appropriate protection to intangible as well as
tangible property which forms a part of a lawful buginess.
Equity does not draw any distinction between the two
kinds of property in respect of protection against wrongful
invasion.”
We can only conclude that plaintiff is entitled to an
injunction enjoining defendants from trafficking in the
S&H stamps as articles of commerce, and the judgment of
the trial court should be affirmed if plaintiff is legally
conducting its business. See Moral Insurance Company v.
Fechtel, Okl., 280 P.2d 716.
PROPOSITION II
Defendants contend that the plaintiff's contracts with
its licensees wherein plaintiff seeks to reserve title to the
stamps are void and illegal and against public policy of the
State and the United States because each contract is an
integral part of a vertical combination in restraint of
trade, and plaintiff violates the State and Federal anti-
monopoly laws in the operation of its business based upon
said contracts.
ol ead
[APPENDIX]
To sustain the above contention defendants cite Arti-
cle 2, Sec. 32; and Article 5, Sec. 44, of the Oklahoma Con-
stitution; and Title 79 O.S. 1961, Sec. 1 & 3; and the Fed-
eral Statutes prohibiting monopolies and cases construing
the Sherman Anti-Trust Act. Under several sub-divisions
the plaintiff argues the stamps are articles of commerce;
attempted. reservation of title to the stamps, which are arti-
cles of commerce, restrain trade by vertical combinations;
restraints against alienation are illegal; monopoly by what-
ever means is condemned; vertical combinations are pro-
hibited; “tying agreements” are illegally monopolistic; and
there are no contractual rights between the plaintiff and
the collectors. -
Under the plaintiff’s contracts with its licensees, the
licensee purchases no commodity from the plaintiff for
resale. The licensee does purchase, however, the services
of plaintiff and the licensee is not prohibited from pur-
chasing the services of another stamp company. The value
of plaintiffs services to its licensee is, in effect, determined
by the volume of business done by the licensee. The col-
lector is not obligated to take the stamps offered by the
licensee nor is he obligated to present for redemption the
stamps he may obtain. The collector is under no obligation
to the licensee or to the plafntiff, but the plaintiff is obli-
gatéd to redeem the stamps in merchandise if the same are
presented for redemption. The collector may enforce the
obligation or he may ignore it by failure to present the
stamps for redemption.
Without question, the method by which plaintiff con-
ducts its business, restraints are placed on others from
trafficking or trading in its stamps. However, the evidence
does not disclose that plaintiff has monopolized the trading
stamp business (the trial court found there were four
other major stamp companies doing business in Oklahoma),
_—
[APPENDIX]
nor does the direct and tended effect of the methods em-
ployed by plaintiff prevent others from engaging in similar
enterprises.
In Sperry & Hutchinson Co. v. Temple, 137 Fed. 992, it
was held that the business of issuing trading stamps to be
given to purchasers of small bills for cash, redeemable in
articles of merchandise, etc., when honestly conducted, is
not contrary to public policy; and, that the nature of the
business required there should be a certain monopoly.
In Sperry & Hutchinson Co. v. Fenster, 219 Fed. 755,
it was held that: “Act. Cong. October 15, 1914, c, 321, § 3,
38 Stat. 731, prohibiting the making of a contract fixing the
price for merchandise on condition that the lessee or pur-
chaser shall not use or deal in the merchandise of a com-
petitor, if the effect of the contract is to substantially les-
sen competition or tend to create a monopoly, does not
prohibit a trading stamp concern from restricting redemp-
tion privileges to subscribers under contract with it bind-
ing such customers to distribute stamps only to customers.”
In Lorain Journal Co. v. United States, 342 US. 143,
the Supreme Court of the United States said that in the
absence of any purpose to create or maintain a monopoly,
the Sherman Anti-Trust Act does not restrict the long
recognized right of a trader or manufacturer engaged in an
entirely private business, freely to exercise his own inde-
pendent discretion as to parties with whom he will deal.
In Klor’s Inc. v. Broadway-Hale Stores, Inc., 359 U.S.
207, it is stated that Section 1 of the Sherman Anti-Trust
Act makes illegal any contract, combination or conspiracy
dn restraint of trade, and section 2 forbids any person or
‘combination from monopolizing or attempting to monopo-
~ lize any part of ‘interstate commerce. The Court said,
“Group boycotts, or concerted refusals by traders to deal
with other traders, have long been held to be in the for-
bidden category.”
—xxxiv—
[APPENDIX]
In the instant action, plaintiff does not follow a pattern
or practice of refusing to deal with any particular merchant
or group of merchants. As found by the trial court, plaintiff
“* * * srants to each licensee in a particular line of busi-
ness the exclusive right to its S&H Cooperative Discount
System within his competitive area.” If a licensee in a par-
ticular line of business did not have the exclusive right to
issue stamps within its competitive area, the value of plain-
tiff’s services to its licensees would be greatly reduced. And
it is important that licensees be confined to non-competing
retailers in a given eompetitive area because the value of
plaintiff's services to its licensees is measured in terms of
the advantage the licensees gain in attracting new custom-
ers and retaining those he already has. In other words,
plaintiff grants exclusive rights to its licensees to issue its
stamps in the licensees’ competitive area but it does not
refuse to deal with any particular merchant or group of
merchants. Plaintiff's method of operation springs from
business requirements and not for the purpose of monopo-
lizing the trading stamp business or restraining trade.
In Thomas v. Belcher, 184 Okl. 410, 87 P.2d 1084, we
held that a retailer’s contract with a wholesaler or dis-
tributor of merchandise limiting the retailer to a definite
and exclusive territory for the resale of such merchandise
does not restrain trade or competition in violation of the
Federal or State Anti-Trust Laws. See also Packard Motor
Car Co. v. Webster Motor Car Co., 243 F.2d 418. If a manu-
factor and dealer, or a wholesaler and retailer, can agree
to an exclusive distributorship in a given area, we can see
no illegality in plaintiff granting exclusive rights to a
licensee in a particular line of business in a competitive
. area to issue its stamps.
In the Thomas v. Belcher case, supra, we said:
“* * * The illegality of contracts in restraint of
commerce is a product of public policy. If such con-
tracts are not contrary to public policy they violate
—xXxXxXv—
[APPENDIX]
neither the federal nor the state anti-trust laws. Until
a commercial arrangement between parties reaches a
stage where commodities needful to the public welfare
are restricted commercially to the point where the
public is exposed to the evils of monopoly, such ar-
rangement is not in restraint of trade within the mean-
ing of the anti-trust laws.”
In Times-Picayune Publishing Co. v. United States,
345 U.S. 594, it is stated that a “tying” arrangement vio-
lates Sec. 1 of the Sherman Anti-Trust Act when a seller
enjoys a monopolistic position in the market for the “tying”
product and a substantial volume of commerce in the “tied”
product is restrained; and, that the common core of the
adjudicated unlawful tying arrangements is the forced
purchase of a second distinct commodity with the desired
purchase of a dominant “tying” product, resulting in eco-
nomic harm to competition in the “tied” market.
In the instant action, licensees do not purchase a com-
modity but a service, and it is not required to purchase a
“tying” product. The collectors have no obligations to the
plaintiff as plaintiffs licensees, but the obligations are in
favor of the collectors. The trading stamp, when issued
represents a closed transaction between plaintiff and its
licensee, and creates an outstanding obligation on the part
of plaintiff to redeem the stamps. See Sperry & Hutchinson
Co. v. Mechanic’s Clothing Co., 135 F. 813.
For a general discussion on the legality of the trading
stamp business as generally conducted, see The Ohio State
Law Journal, Volume 23, No. 1, (1962) pages 35 through
55.
Defendants have cited no case and our independent
research fails to disclose any cases supporting the propo-
sition that plaintiff's method of conducting its business in
Oklahoma violates any State or Federal laws. In our opin-
ion, and we so hold, that the method by which plaintiff
—xxxvi—
[APPENDIX]
conducts its business in Oklahoma is not in violation of
our State or Federal Laws.
PROPOSITION III
Defendants contend that public interest is adversely
affected by the judgment of the trial court and such is
therefore improper, inequitable and improvident; and that
plaintiff's hands are unclean and is estopped by its illegal
conduct, its mode of operations and its failure to treat the
stamp collectors fairly, as well as by its discriminatory
Title 79 O.S. 1961, Sec. 1, provides that every act,
agreement, contract, or combination in the form of trust
or otherwise, or conspiracy in restraint of trade or com-
merce within this State, which is against public policy, is
declared to be illegal. Article 2, Section 32, of our Consti-
tution provides that perpetuitius and monopolies are con-
trary to the genius of free government, and shall never be
allowed.
However, until a commercial arrangement, or a
method of doing business, reaches a stage where the needs
of the public are restricted to the point where the public
is exposed to the evils sought to be prohibited, or such
restriction is contrary to the genius of free government,
such arrangement or method of doing business is not
against the public policy. See Thomas v. Belcher, 184 Okl.
410, 87 P.2d 1084.
We\have heretofore determined that. plaintiff's busi-
ness is not illegal; that it does not violate any State or
Federal ; and that defendants’ actions are injurious
to plaintiff's business. We have also determined that the
stamp business in Oklahoma is competitive and that the
competition created by plaintiff and four other major
stamp companies doing business in Oklahoma has created
defendants’ business.
aie -
[APPEND!IX}
There is no evidence that plaintiff has employed dis-
criminatory practices in selecting or entering into con-
tracts with its licensees; or the method of conducting
plaintiff's business prevents others from lawfully engaging
in similar enterprises; or that any collector has any more
or less rights than any other collector. Each collector has
the same redemption privileges as all other collectors and
there is no evidence that the stamps, when properly pre-
sented for redemption, have any more or less redemption
value in one redemption center than in another redemption
center.
The trial court found that in one state plaintiff is
prohibited by law from carrying on its business; in three
other states, plaintiff is required by statute to redeem the
stamps in cash; and in thirteen states the statutes require
that the stamps be redeemed by plaintiff either in cash or
merchandise—at the option of the holder. Our Legislature
has not enacted legislation requiring plaintiff to redeem the
stamps in cash or redeem the stamps in cash or merchan-
dise—at the option of the holder. In other words, our Legis-
lature has not seen fit to enact any legislation i
concerning the stamp business or any legislation
ing the rights, duties and obligations of stamp
licensees, and collectors; except, however,
(Title 21 O.S. 1961, Secs. 361-364), which are pertinent
in the case at bar.
We can only conclude that plaintiff's method of con-
ducting its business does not adversely affect the public
interest; that it is legally conducting its business, and the
judgment of the trial court is not improper or inequitable.
CONCLUSIONS
In the instant action, we are not concerned with re-
demption rights but whether plaintiff is entitled to in-
junctive relief. Whether injunctive relief is to be granted
—xxxviii—
[APPENDIX)
in an action in equity is a matter within the sound legal
discretion of the court, to be determined in the light of all
the facts and circumstances and each case must be con-
sidered in the light of its own particular facts. Cooke v.
»\ Southwest Petroleum Co., 177 Okl. 458, 61 P.2d 16.
The controlling issues herein presented, i.e., the man-
ner or method employed by plaintiff and defendants in
conducting their business, were questions of fact and. these
issues were resolved in favor of the plaintiff and against the
defendants by the trial court. In Nowlin v. Wilson, 187 Okl.
173, 101 P.2d 805, we held that the findings of the trial
court should be strongly persuasive, and should not be set
aside unless this Court can say, in equity and good con-
science, that the conclusion reached by the trial court is
against the clear weight of the evidence.
We can only conclude and hold that the judgment of
the trial court should be and the same is hereby affirmed.
CONCUR: HALLEY, C.J., JACKSON, V.C.J. and DAVI-
SON, WILLIAMS, BLACKBIRD and BERRY,
JJ.
.
APPENDIX E
In SupreME Court
OF OKLAHOMA
June 22, 1965
IN THE SUPREME COURT OF THE
STATE OF OKLAHOMA
Tuesday, June 22, 1965
THE CLARE REC 0 SN TES THE FOL
LOWING ORDERS:
—xxxix—
[APPENDIX)}
40423—-Wm. Rance and Ruth V. Rance v The Sperry &
Hutchinson Company a corp. Rehearing and oral
argument denied,
Harry L. S. HAtiey
Chief Justice
ATTEST: '
Andy Payne, Clerk
APPENDIX F
FILED
In SuPREME CouRT
‘ OF OKLAHOMA
‘ July 27, 1965
Andy Payne, Clerk
IN THE SUPREME COURT OF THE
STATE OF OKLAHOMA
Tuesday, July 27, 1965
THE CLERK IS DIRECTED TO ENTER THE FOL-
LOWING ORDERS:
40423—William Rance and Ruth V. Rance v. The Sperry
and Hutchinson Company, a corp. Issuance and
transmission of mandate is withheld until Septem-
ber 22, 1965, pending perfection of appeal by plain-
tiffs in error to the Supreme Court of the United
States; if their appeal will stand perfected on or
‘ before that date, mandate shall be further with-
held until such time as the Supreme Court of the
United States shall have rendered a final decision
herein or until further order of this Court.
Harry L. S. HALtey
. Chief Justice
ATTEST: Andy Payne, Clerk
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.