United States v. Bausch & Lomb Optical Co., 321 U.S. 707 (1944)

United States v. Bausch & Lomb Optical Co.

Argued December 8, 1943
Decided April 10, 1944 GO>*
321 U.S. 707

APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES

FOR THE SOUTHERN DISTRICT OF NEW YORK

Syllabus

1. The provision of the judgment dismissing, as to certain of the defendants, the complaint in a suit to restrain alleged violations of the Sherman Act is here affirmed by an equally divided Court. P. 719.

2. A distributor of a trademarked article in interstate commerce may not limit by agreement, express or implied, the price at which or the persons to whom its purchaser may resell, except as authorized by the Miller-Tydings Act. P. 721.

3. The evidence in this case supports the District Court’s finding of a combination and conspiracy between the Soft-Lite company (a distributor of trademarked pink-tinted ophthalmic lenses) and wholesalers to maintain resale prices through a distribution system in violation of the Sherman Act. On review of its decree, held:

(a) The order of the District Court directing cancellation of Soft-Lite’s arrangements with wholesalers and cessation of systematic price suggestions was justified by the findings. P. 723.

Whether the conspiracy and combination was achieved by agreement or by acquiescence of the wholesalers, coupled with assistance in effectuating its purpose, is immaterial.

(b) Clauses of the decree which hold null and void certain resale price maintenance contracts entered into by Soft-Lite and wholesalers subsequent to the Miller-Tydings Act, and which forbid enforcement of such contracts and the execution of any others for six months after notice of cancellation, are justified in view of the illegality of the distribution system previously existing and because the contracts in respect of a portion of the resales are not immunized by the Act. P. 724.

Equity has power to eradicate the evils of a condemned scheme by prohibition of the use of admittedly valid parts of an invalid whole.

(c) Provisions of the decree giving representatives of the Department of Justice certain broad visitatorial powers, as construed by this Court, were within the power and discretion of the District Court. P. 726.

(d) A provision of the decree directing the defendants to submit, on the written request of the Department of Justice, such reports in writing "with respect to any of the matters continued in this judgment" as may be necessary to enforce it is too indefinite for judicial enforcement, and therefore inappropriate. Pp. 725, 728.

(e) The Government’s requests that the decree require Soft-Lite to sell its product to any person offering to pay cash therefor, and that the prohibition against Soft-Lite’s systematically suggesting resale prices and its execution of resale price maintenance contracts under the Miller-Tydings Act be made permanent, are denied. P. 728.

45 F.Supp. 387 modified and affirmed.

Cross-appeals from a decree which, in a suit to restrain alleged violations of the Sherman Act, dismissed the complaint as to certain of the defendants and gave injunctive relief against others.