prices would be higher on average, that they would have fewer sales, and that consumers would suffer accordingly. The public interest, therefore, weighs in favor of enjoining this sale.
Injury to Bon-Ton
One of the defenses raised by defendants is that Bon-Ton has no standing to sue here since it has not suffered any antitrust injury. The point is somewhat academic, however, because defendants concede that the State is a proper party plaintiff. But, in any event, I do not agree with defendants' contentions concerning Bon-Ton. There is a direct nexus between an anticompetitive act--May's acquisition of McCurdy's assets--and the alleged injury to Bon-Ton: its effective exclusion from the Rochester market. Courts have held in many cases that a business which has been prevented from entering (and thus competing in) a market have standing to sue under the antitrust laws. See, e.g., Los Angeles Memorial Coliseum Comm'n v. National Football League, 791 F.2d 1356 (9th Cir. 1986), cert. denied, 484 U.S. 826, 98 L. Ed. 2d 53, 108 S. Ct. 92 (1987); Affiliated Capital Corp. v. City of Houston, 735 F.2d 1555 (5th Cir. 1984), cert. denied, 474 U.S. 1053, 106 S. Ct. 788, 88 L. Ed. 2d 766 (1986).
In Consolidated Gold Fields, the Second Circuit held that the target of an acquisition had antitrust standing because its "loss of independence [which would result from the acquisition] is causally linked to the injury occurring in the marketplace, where the acquisition threatens to diminish competitive forces." 871 F.2d at 258. Likewise, Bon-Ton's inability to compete in the Rochester market is causally linked to the acquisition at issue here. There has been extensive testimony concerning the need for department stores today to locate in shopping malls as opposed to other types of locations. Even defendants' expert, James Mack Folsom, admitted that he was unaware of department stores currently locating new stores in non-mall locations. (Tr. 447). By acquiring two of the only available mall sites in the Rochester area, May would raise significant barriers to Bon-Ton's entry into the market. That is precisely the harm alleged here by Bon-Ton.
"It is axiomatic in antitrust jurisprudence that a federal court has broad discretion to remedy violations of the law." Trustees of A. J. Bremen Realty Trust v. City of Boston, Civ. No. 84-2431- MA, 1985-1 Trade Cas. (CCH) P66,520 (D.Mass. Mar. 12, 1985). Where an antitrust violation exists, therefore, "the district court 'has the duty to compel action ... [to] cure the ill effects of the illegal conduct, and assure the public freedom from its continuance.'" Trabert v. Hoeffer, Inc. v. Piaget Watch Corp., 633 F.2d 477, 485 (7th Cir. 1980) (quoting United States v. Ward Baking Co., 376 U.S. 327, 330, 11 L. Ed. 2d 743, 84 S. Ct. 763 (1964)).
Doubts as to the necessity of issuing a preliminary injunction should be resolved in favor of granting the injunction. Consolidated Gold Fields, 871 F.2d at 261. This is often especially true in antitrust cases, where, once the proposed merger or acquisition is consummated, "it becomes difficult, and sometimes virtually impossible, for a court to 'unscramble the eggs.' A preliminary injunction is therefore the remedy of choice for preventing an unlawful merger." Id. (quoting Sonesta Int'l Hotels Corp. v. Wellington Assoc., 483 F.2d 247, 250 (2d Cir. 1973)).
Therefore, the following is hereby ORDERED AND DECREED:
Plaintiffs' request for a preliminary injunction is granted and defendants' motions to dismiss are denied.
The Asset Purchase Agreement, dated July 1, 1994, between McCurdy & Company, Inc. and The May Department Stores Company is hereby vacated and annulled.
The May Department Stores Company is directed to divest itself of all McCurdy's assets obtained by virtue of the July 1, 1994 Asset Purchase Agreement, and to return any consideration paid on account of such assets.
Defendant May Department Stores Company, and its officers, directors and agents, and any subdivision or other corporation controlled by the May Department Stores Company, is enjoined, pending the final determination of this action, from acquiring or attempting to acquire in any manner controlling interest in the stock or assets of McCurdy & Company, Inc., consisting of real property and structures, in the Rochester metropolitan area, that is in Monroe and Ontario Counties, New York.
IT IS SO ORDERED.
DAVID G. LARIMER
UNITED STATES DISTRICT JUDGE
Dated: Rochester, New York
November 30, 1994.