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GETTY PETROLEUM CORP. v. SHORE LINE OIL CO.

July 16, 1986

GETTY PETROLEUM CORP., Plaintiff,
v.
SHORE LINE OIL COMPANY, INC., ANTHONY MAZZARA and SALLY MAZZARA, Defendants



The opinion of the court was delivered by: MISHLER

Memorandum of Decision and Order

JACOB MISHLER, UNITED STATES DISTRICT JUDGE

 Getty Petroleum Corp. ("Getty Petroleum") moves to punish defendant Shore Line Oil Company, Inc. ("Shore Line") and its president, Louis Capossela, for contempt in the violation of this court's permanent injunction order dated November 14, 1985 issued on consent of Shore Line in accordance with a stipulation of settlement dated November 7, 1985. The order provides in pertinent part:

 that Shore Line Oil Company, its agents, servants, employees, attorneys and all persons in active concert or participation with it are hereby enjoined from any manner directly or indirectly, selling, transporting or delivering any gasoline or petroleum product to any gasoline station bearing the mark and designation GETTY.

 The language is that to which Shore Line consented in the stipulation of settlement. Shore Line's response is that it understood that the injunctive provision covered only Getty-owned gasoline service stations and not stations individually owned. *fn1" Subsequent to November 14, 1985, Shore Line delivered non-branded gasoline to the following three gasoline service stations that are "individually owned" selling gasoline under trademark "GETTY":

 1. Eastchester Creek Gas Station, Inc., ("Eastchester Creek") 759 South Fulton Avenue, Mt. Vernon.

 2. Dom's Service Station, ("Dom's") 268 Tarrytown Road, Greenburgh.

 3. Auto Center, 43 Virginia Road, White Plains.

 Shore Line moves to vacate and set aside the permanent injunction order. The court conducted a hearing and finds: From November 9, 1985 to January 23, 1986, Shore Line made deliveries of gasoline totalling: To Eastchester Creek Regular Unleaded 213,700 gals. Super Unleaded 214,200 Regular Leaded 187,500 To Dom's Regular Unleaded 2,504 Super Unleaded 13,034 Regular Leaded 9,492 To Auto Center Regular Unleaded 7,001 Super Unleaded 4,000 Regular Leaded 8,501

 During the period approximately sixty-seven (67) deliveries were made by Shore Line to Eastchester Creek; six (6) deliveries to Dom's; and five (5) deliveries to Auto Center. Eastchester Creek also purchased unbranded gasoline from Dino Petroleum, a Shore Line competitor.

 In February, 1985, Getty Petroleum's predecessor in title to the many franchised gasoline stations operating under the "GETTY" trademark was acquired by Getty Petroleum under a corporate name of Power Test.

 Eastchester Creek operated as an individually owned gasoline station under a Getty franchise since 1970. On December 14, 1981, Eastchester entered into a franchise agreement (described as a "Dealer Contract") for a period of 3 years and 6 months with Getty Refining and Marketing Company ("Getty Refining"), predecessor to Power Test. The agreement, by its terms, was extended from year to year "provided, however, that Dealer [franchisee] may cancel this contract at any time so long as he gives Company [franchisor] at least ninety (90) days prior written notice to cancel same." The agreement provided that:

 Company shall sell and deliver to Dealer and Dealer shall purchase and take from Company during the term hereof Dealer's requirements of Company's Gasolines, Motor Oils, Greases and inventory for resale at the above premises of Dealer.

 Prior to 1981 and subsequent thereto Eastchester Creek purchased about one-third of its gasoline from sources other than Getty Refining. Some of the supply of gasoline was purchased on the "spot market" at a cost of 10 cents to 15 cents less than the cost of Getty gasoline. Getty Refining was fully aware of ...


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