Ross-Simons v. Baccarat, Inc.

UNITED STATES COURT OF APPEALS
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
FOR THE FIRST CIRCUIT

No. 96-1619

ROSS-SIMONS OF WARWICK, INC., ET AL.,

Plaintiffs, Appellees,

v.

BACCARAT, INC.,

Defendant, Appellant.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF RHODE ISLAND

[Hon. Francis J. Boyle, Senior U.S. District Judge]

Before

Selya, Cyr and Lynch,

Circuit Judges.

Jeffrey A. Oppenheim, with whom Kane Kessler, P.C., John H.

Blish, Joseph V. Cavanagh, Jr., Michael W. Carroll and Blish &

Cavanagh were on brief, for appellant.

Steven E. Snow, with whom Thomas R. Noel and Partridge, Snow

& Hahn were on brief, for appellees.

December 13, 1996

SELYA, Circuit Judge. Defendant-appellant Baccarat,
SELYA, Circuit Judge.

Inc. (Baccarat) implores us to dismantle a preliminary injunction

that compels it to continue selling its wares to the plaintiffs.1

Discerning neither error of law nor abuse of discretion, we

affirm.

I. BACKGROUND
I. BACKGROUND

We divide our account of the relevant background

material into four segments.

A. The Commercial Climate.
A. The Commercial Climate.

Baccarat is a subsidiary of Compagnie des Cristalleries

de Baccarat, a prestigious French lead crystal manufacturer. It

is the exclusive distributor in the United States of this

aristocratic product line.

Ross-Simons sells jewelry, tableware, crystal, and

sundry other merchandise from retail stores located in several

states. Roughly eighty-five percent of its business, however, is

generated through catalog and telemarketing sales. It

distributes 45,000,000 catalogs annually and maintains a bustling

distribution center in Cranston, Rhode Island. A bridal gift

registry comprises an integral part of Ross-Simons' business.2

1Ross-Simons, Inc., Ross-Simons of Warwick, Inc., Ross-
Simons of Barrington, Inc., Ross-Simons of Atlanta, L.L.C. and
Ross-Simons of North Carolina, L.L.C. are all named plaintiffs
herein. For simplicity's sake we refer to them collectively as
"Ross-Simons."

2The mechanics of a bridal gift registry are uncomplicated.
In its simplest iteration, betrothed couples select items that
they would like to possess and "register" with a merchant who
carries those items. Persons who wish to give wedding presents
or gifts for other occasions can then contact the merchant,

2

The firm acquires approximately 15,000 new registrants annually

and has about 30,000 active registrations at any given time. In

1995 Ross-Simons grossed $150,000,000 from all its operations,

including $1,000,000 attributable to Baccarat crystal (mostly

from catalog sales).

Ross-Simons carved its niche as a discount or "off-

price" retailer, frequently advertising prices as much as fifty

percent below suggested retail prices. Baccarat comes from a

different school, having steadfastly resisted discounting and

discounters. For many years Baccarat refused to sell its crystal

to Ross-Simons. Moreover, when Baccarat became the exclusive

American distributor of Haviland Limoges porcelain dinnerware

(not a product that Baccarat manufactured), it terminated Ross-

Simons as an authorized dealer for that line.

Rather than turning the other cheek, Ross-Simons

responded by filing an antitrust suit. Its complaint alleged

inter alia that Baccarat refused to deal with Ross-Simons due to

the latter's proclivity for discount pricing. In November of

1992, the parties entered into a written accord (the 1992

Agreement) that settled their differences.3 Pursuant to that

agreement, the federal district court dismissed the antitrust

suit without prejudice.

choose an item from the list, and have it delivered to the
registrant(s).

3In addition to Baccarat, other named defendants were
parties to both the lawsuit and the settlement. Their
involvement does not affect this appeal.

3

B. The 1992 Agreement.
B. The 1992 Agreement.

An understanding of the 1992 Agreement is critical to

reasoned consideration of the issues on appeal. Baccarat and

Ross-Simons styled the pact as an "Agreement of Compromise and

Settlement" and stipulated that it would be governed by Rhode

Island law. They memorialized it "as a compromise between the

parties for the settlement of their claims, differences and

causes of action." However, they did not ask the district court

either to approve the settlement terms or to enter a decree

embodying those terms.

By virtue of the 1992 Agreement, Baccarat appointed

Ross-Simons as an authorized dealer "entitled to purchase and

resell [Baccarat crystal] products at such prices and upon such

terms as are available to other authorized dealers." In addition

Baccarat agreed "not [to] terminate Ross-Simons' status as an

authorized dealer, nor otherwise discriminate against Ross-Simons

in any manner, [for its refusal] to adhere to suggested resale

prices or due to Ross-Simons' marketing through direct-mail

catalogs." The 1992 Agreement contains no durational term, but

it specifically provides that its covenants and conditions are

not terminable on the basis of changed facts.

C. The Proposed Agreement.
C. The Proposed Agreement.

Ross-Simons sold Baccarat products for three years,

without incident, until a series of events shattered the

increasingly fragile business relationship. A new management

regime took control of Baccarat in 1994 and Jean-Luc Negre became

4

the firm's chief executive officer. Early on, Negre made known

his view that it was inappropriate for retailers to discount

luxury items. He then reshaped Baccarat's marketing strategy in

an attempt, as he put it, to improve the "overall image and

prestige . . . of [Baccarat's] world-renowned name." Under the

revised plan, Baccarat limited the number of retailers to whom it

would sell its products and simultaneously introduced a new

"Authorized Dealer Program." To retain authorized dealership

status in 1996 and beyond, a retailer had to sign a particular

form of dealer agreement (the Proposed Agreement) no later than

December 15, 1995.

Although Baccarat invited Ross-Simons (along with 379

other retailers) to participate in this neoteric program, there

was a rub; by its terms the Proposed Agreement prohibits the

advertising of Baccarat products in any catalog or other printed

medium that promotes at off-prices more than twenty-five percent

of the items advertised. In addition, Baccarat reserved the

right to determine in its sole discretion "whether an advertising

or promotional practice is damaging to the image, prestige and

goodwill" of its products. If Baccarat found any such practice

offensive, it could terminate the dealership forthwith. Because

Ross-Simons (alone among Baccarat's invitees) devotes most of its

catalog to discounted items, and because Negre previously had

proclaimed that off-pricing was inconsistent with prestige, Ross-

Simons viewed the proposal as a "suicide note," asserted that it

violated the terms of the 1992 Agreement, and refused to sign.

5

Presumably in anticipation that Baccarat would follow through on

its threat of termination, Ross-Simons stockpiled Baccarat

products in late 1995. The precaution proved justified, as

Baccarat refused to fill Ross-Simons' orders (including 1995

orders previously received but theretofore unfilled) from and

after January 1, 1996.

D. The Proceedings Below.
D. The Proceedings Below.

Ross-Simons sued Baccarat in a Rhode Island state

court, claiming breach of contract, breach of an implied covenant

of good faith and fair dealing, and tortious interference with

advantageous business relationships. Baccarat removed the case

to the federal district court. See 28 U.S.C. 1332(a)

(diversity jurisdiction), 1441 (permitting removal of cases in

which diversity jurisdiction exists). In short order, the

district court conducted an evidentiary hearing and granted Ross-

Simons' motion to compel Baccarat, pendente lite, to continue to

sell products in pursuance of the 1992 Agreement. In its ruling

the court predicted that Ross-Simons probably would prevail on

the theory that the Proposed Agreement constituted an

impermissible attempt by Baccarat to subvert the 1992 Agreement.

Relatedly, the court concluded that Ross-Simons would suffer

irreparable harm in the absence of mandatory injunctive relief,

and conversely, that Baccarat would undergo scant hardship should

6

a preliminary injunction issue. This appeal ensued.4

II. ANALYSIS
II. ANALYSIS

In the sections that follow, we peruse the checklist

applicable to preliminary injunction determinations and then

assess how well the district court's order withstands Baccarat's

multi-pronged attack.

A. The Preliminary Injunction Standard.
A. The Preliminary Injunction Standard.

Over time, we have crafted a four-part framework for

use in determining whether the grant or denial of preliminary

injunctive relief is appropriate. Under this formulation, trial

courts must consider (1) the likelihood of success on the merits;

(2) the potential for irreparable harm if the injunction is

denied; (3) the balance of relevant impositions, i.e., the

hardship to the nonmovant if enjoined as contrasted with the

hardship to the movant if no injunction issues; and (4) the

effect (if any) of the court's ruling on the public interest.

See Weaver v. Henderson, 984 F.2d 11, 12 & n.3 (1st Cir. 1993);

Narragansett Indian Tribe v. Guilbert, 934 F.2d 4, 5 (1st Cir.

1991).

An appellate court affords considerable deference to

the district court's evaluative judgment of these discrete

factors and of their interrelationship. See Anthony v. Sundlun,

952 F.2d 603, 605 n.2 (1st Cir. 1991). Thus, a party who appeals

4Baccarat's endeavors to secure a stay were unavailing, and
the preliminary injunction is in force.

7

from the issuance of a preliminary injunction bears the

considerable burden of demonstrating that the trial court

mishandled the four-part framework. See EEOC v. Astra USA, Inc.,

94 F.3d 738, 743 (1st Cir. 1996). In sum, unless the appellant

can show that the lower court misapprehended the law or committed

a palpable abuse of discretion, the court of appeals will not

intervene. See Narragansett Indian Tribe, 934 F.2d at 5;

Independent Oil & Chem. Workers of Quincy, Inc. v. Procter &

Gamble Mfg. Co., 864 F.2d 927, 929 (1st Cir. 1988). Though

mistake of law is a rubric that requires no elaboration, abuse of

discretion is a fuzzier concept. That inquiry is case-specific,

see Weaver, 984 F.2d at 13; Narragansett Indian Tribe, 934 F.2d

at 5-6, and a finding of abuse usually entails proof that the

nisi prius court, in making the challenged ruling, ignored

pertinent elements deserving significant weight, considered

improper criteria, or, though assessing all appropriate and no

inappropriate factors, plainly erred in balancing them, see

Procter & Gamble, 864 F.2d at 929.

We proceed to scrutinize the district court's ruling

under this deferential glass. In so doing, we address only the

first two rungs of the four-part framework, as Baccarat does not

challenge the district court's analysis anent either the third or

fourth rung.

B. The Likelihood of Success.
B. The Likelihood of Success.

Likelihood of success is the main bearing wall of the

four-factor framework. See Weaver, 984 F.2d at 12; Auburn News

8

Co. v. Providence Journal Co., 659 F.2d 273, 277 (1st Cir. 1981),

cert. denied, 455 U.S. 921 (1982). Here, Baccarat challenges the

district court's assessment of this factor in two respects. We

examine each in turn. Before doing so, however, we deem it

prudent to remind the reader that, just as the trial court, at

the preliminary injunction stage, need not predict the eventual

outcome on the merits with absolute assurance, see Narragansett

Indian Tribe, 934 F.2d at 6 (cautioning that decisions on

preliminary injunction "are to be understood as statements of

probable outcomes" only), an appellate court need not

conclusively determine the merits of the underlying claims to

execute abuse-of-discretion review.

1. The Nondiscrimination Clause. As previously
1. The Nondiscrimination Clause.

mentioned, see supra Part I(B), Baccarat agreed in 1992 not to

"discriminate against Ross-Simons in any manner" because of its

predilection for off-pricing. The district court relied on this

clause in holding that Ross-Simons likely would prevail on its

breach of contract claim. However, Baccarat maintains that it

terminated Ross-Simons for failing to sign the Proposed Agreement

and, in doing so, treated Ross-Simons the same as any other

dealer who refused to honor this uniform set of terms. Since the

lower court's order requires Baccarat to treat Ross-Simons

differently than other dealers that is, more favorably, by

allowing Ross-Simons to buy Baccarat crystal without abiding by

the Proposed Agreement's uniform terms it is the court's order,

not Baccarat's conduct, this thesis holds, which contradicts the

9

nondiscrimination clause contained in the 1992 Agreement. This

resupinate reasoning stands the nondiscrimination clause on its

head and ignores the district court's factual findings.

Judge Boyle found that of the 380 retailers whom

Baccarat invited to become authorized dealers, only one of them

Ross-Simons engaged in systematic off-pricing. Thus, while the

proscription against widespread discounting was part and parcel

of a uniform contract (i.e., the Proposed Agreement), only Ross-

Simons would feel its sting. Building on this foundation the

judge drew the eminently reasonable inference that Baccarat

(which had not previously attempted to impose a monolithic set of

dealer agreements) wrote these particular provisions in a

deliberate effort to circumvent the 1992 Agreement. On this

basis, he concluded that Ross-Simons probably would succeed on

the merits inasmuch as the proscription violated the

nondiscrimination clause.5

To be sure, these findings are not inevitable, but they

reflect a plausible rendition of the evidence then before the

court. The findings, in turn, support the court's chain of

reasoning and give meaningful effect to the 1992 Agreement's

nondiscrimination clause. That ends the matter: at this

preliminary stage, it is both the trial court's prerogative and

its duty "to assess the facts, draw whatever reasonable

5Among other things, Baccarat's former president (who signed
the 1992 Agreement on its behalf) executed an affidavit
supporting Ross-Simons' view of the nondiscrimination clause.
This testimony buttresses the district court's application of the
clause.

10

inferences it might favor, and decide the likely ramifications."

Procter & Gamble, 864 F.2d at 933.

2. The Uniform Commercial Code. In its next foray
2. The Uniform Commercial Code.

Baccarat attempts to characterize the 1992 Agreement as a

contract for the sale of goods, thus bringing into play Article

Two of the Uniform Commercial Code (UCC), R.I. Gen. Laws 6A-2-

101 to 6A-2-725 (1992), and, in particular, R.I. Gen. Laws 6A-

2-309(2) ("Where the contract provides for successive

performances but is indefinite in duration it is valid for a

reasonable time, but unless otherwise agreed may be terminated at

any time by either party."). In Baccarat's view, this statute

renders the 1992 Agreement terminable at will and thus undermines

Ross-Simons' contract claims. This argument, though burnished

with considerable care, builds on a false premise.

We begin with bedrock. Courts look to the apparent

intentions of the contracting parties when interpreting

contracts. See United States v. Seckinger, 397 U.S. 203, 212

n.17 (1970); McCarthy v. Azure, 22 F.3d 351, 355 (1st Cir. 1994);

Fashion House, Inc. v. K mart Corp., 892 F.2d 1076, 1084 (1st

Cir. 1989); Johnson v. Western Nat'l Life Ins. Co., 641 A.2d 47,

48 (R.I. 1994). A valid settlement agreement is an enforceable

contract subject to this basic principle of construction. See

ITT Corp. v. LTX Corp., 926 F.2d 1258, 1266-67 (1st Cir. 1991);

Mathewson Corp. v. Allied Marine Indus., Inc., 827 F.2d 850, 856

(1st Cir. 1987); T & T Mfg. Co. v. A.T. Cross Co., 587 F.2d 533,

537 (1st Cir. 1978), cert. denied, 441 U.S. 908 (1979); cf.

11

Langton v. Johnston, 928 F.2d 1206, 1221 (1st Cir. 1991) (stating

that consent decrees between private parties in a commercial

setting are treated as contracts). Thus, whether Article Two

applies to the 1992 Agreement hinges primarily on the parties'

intentions.

The district court eschewed any reference to the

statute, apparently convinced that it did not govern the 1992

Agreement. We believe that this action is supportable. Article

Two does not purport to regulate nonsale transactions. See R.I.

Gen. Laws 6A-2-102. Furthermore, if a contract contains a

blend of sale and nonsale elements, Article Two applies only if

the dominant purpose behind the contract reflects a sales

transaction. See ITT, 926 F.2d at 1266; Cianbro Corp. v. Curran-

Lavoie, Inc., 814 F.2d 7, 13-14 (1st Cir. 1987); Bonebrake v.

Cox, 499 F.2d 951, 960 (8th Cir. 1974); see generally 1 J. White

& R. Summers, Uniform Commercial Code 1-1 (4th ed. 1995).

Consequently, Article Two is not in play if the dominant purpose

of an agreement is to settle litigation. See, e.g., ITT, 926

F.2d at 1266; New Eng. Power Co. v. Riley Stoker Corp., 477

N.E.2d 1054, 1060-61 (Mass. App. Ct.), review denied, 481 N.E.2d

197 (Mass. 1985).

While it is not necessary definitively to decide the

issue of predominant purpose at this stage in the proceedings,

the record strongly suggests that the parties to the 1992

Agreement intended first and foremost to settle the antitrust

litigation. For one thing, the title of the pact "Agreement of

12

Compromise and Settlement" is a good barometer of the parties'

intentions. Though the label that contracting parties affix to

an agreement is not necessarily determinative of the agreement's

predominant purpose, it can constitute potent evidence of that

purpose. See, e.g., Triangle Underwriters, Inc. v. Honeywell,

Inc., 604 F.2d 737, 742-43 (2d Cir. 1979) (holding a hybrid

contract entitled "Agreement for the Sale of [Goods]" to be

precisely that); Riley Stoker, 477 N.E.2d at 1060-61 (declining

to characterize a document labelled "Settlement Agreement" as a

contract for the sale of goods).

For another thing, the body of the 1992 Agreement

contains language that is more consistent with the purpose

suggested by its title than with any other purpose. The

agreement opens with a declaration that it represents "a

compromise between the parties for the settlement of their

claims, differences and causes of action with respect to the

dispute." A later section reiterates that the parties executed

the document "for the sole purpose of compromising and settling

the matters involved in [the antitrust] dispute." (Emphasis

supplied). These excerpts comprise powerful evidence that the

primary impetus for the agreement was to abate the pending

litigation.

Baccarat tries to throw cold water on this proposition.

Since the antitrust suit was dismissed without prejudice,

Baccarat suggests that Ross-Simons could have revived the claims

at any time, and, thus, the predominant purpose of the 1992

13

Agreement must have been the sale of goods. We think that this

is a classic non sequitur. Dismissing a lawsuit, even without

prejudice, is not an idle matter; it has consequences in terms of

costs, legal expenses, time bars, and the like. Because the

parties' intentions (and, therefore, the contract's meaning) must

be gleaned from all the surrounding circumstances, see, e.g.,

Seckinger, 397 U.S. at 212 n.17, the dismissal without prejudice,

by itself, cannot support Baccarat's characterization.

There is a second problem with Baccarat's attempt to

invoke Article Two: even this scant record indicates that the

parties never intended the 1992 Agreement to be terminable at

will. Indeed, the parties must have understood that the 1992

Agreement would operate at some length because they specifically

provided in section four that each party assumed the risk of

changes in the operative facts and relinquished any right to

terminate the agreement on the basis of such factual shifts.

This proviso would be nonsensical if either party had the right

to terminate the agreement at will.

Raw logic bolsters this evidence. In exchange for the

covenants contained in the 1992 Agreement, Ross-Simons

surrendered the opportunity to pursue colorable antitrust claims

against Baccarat. A reasonable factfinder easily could conclude

that Ross-Simons would not have abandoned such an opportunity in

exchange for a settlement that, in Judge Boyle's phrase, Baccarat

could have ripped up the next morning. Based on the parties'

intent, made manifest by the language of the 1992 Agreement and

14

the circumstances of the settlement itself, it seems quite likely

that the Agreement was not meant to be terminable at will.

We have said enough on this score. For the reasons we

have enumerated, the lower court's four major actions in respect

to this issue namely, its refusal to apply Article Two, its

determination that the terms of the 1992 Agreement remain in

effect, its interpretation of those terms, and its conclusion

that Ross-Simons had demonstrated a significant likelihood of

success on the merits of its contract claims are impervious to

Baccarat's assault.

C. Irreparable Harm.
C. Irreparable Harm.

Civil Rule 65(a), as interpreted in this circuit,

places the burden of demonstrating that a denial of interim

injunctive relief would cause irreparable harm squarely upon the

movant. See Narragansett Indian Tribe, 934 F.2d at 6. Baccarat

questions whether Ross-Simons carried this burden.

The burden is substantial, but it is possible to

overstate its dimensions. Baccarat falls into this trap by

insisting that, since Baccarat crystal comprises less than one

percent of Ross-Simons' total annual sales, there can be no

irreparable harm because withholding the line could not

jeopardize Ross-Simons' economic viability. To establish

irreparable harm, however, a plaintiff need not demonstrate that

the denial of injunctive relief will be fatal to its business.

See General Leaseways, Inc. v. National Truck Leasing Ass'n, 744

F.2d 588, 591 (7th Cir. 1984). It is usually enough if the

15

plaintiff shows that its legal remedies are inadequate. See

Weinberger v. Romero-Barcelo, 456 U.S. 305, 312 (1982)

(collecting cases); Lopez v. Garriga, 917 F.2d 63, 68 (1st Cir.

1990). If the plaintiff suffers a substantial injury that is not

accurately measurable or adequately compensable by money damages,

irreparable harm is a natural sequel. See, e.g., Multi-Channel

TV Cable Co. v. Charlottesville Quality Cable Operating Co., 22

F.3d 546, 551 (4th Cir. 1994); K-Mart Corp. v. Oriental Plaza,

Inc., 875 F.2d 907, 915 (1st Cir. 1989); Danielson v. Local 275,

Laborers Int'l Union, 479 F.2d 1033, 1037 (2d Cir. 1973). Thus,

a cognizable threat of such harm can support a restraining order.

Even so, whether Ross-Simons made the requisite showing

in this case poses a close question. Although there is no

mechanical test that permits a court to make an exact calculation

of the quantum of hard-to-measure harm that will suffice to

justify interim injunctive relief, there are some relevant

guideposts. In the first place, the plaintiff's showing must

possess some substance; a preliminary injunction is not warranted

by a tenuous or overly speculative forecast of anticipated harm.

See Narragansett Indian Tribe, 934 F.2d at 6-7; Public Serv. Co.

v. Town of W. Newbury, 835 F.2d 380, 383 (1st Cir. 1987). In the

second place, an attempt to show irreparable harm cannot be

evaluated in a vacuum; the predicted harm and the likelihood of

success on the merits must be juxtaposed and weighed in tandem.

See Astra USA, 94 F.3d at 743 (explaining that the greater the

likelihood of merits success, the less that is required in the

16

way of irreparable harm); Gately v. Commonwealth of Mass., 2 F.3d

1221, 1232 (1st Cir. 1993) (noting the same phenomenon and

suggesting that irreparable harm is subject to a "sliding scale"

analysis), cert. denied, 114 S. Ct. 1832 (1994). Finally, it is

clear that battles over the quality and quantity of the harm

alleged most often will be won or lost in the trial court. See

K-Mart, 875 F.2d at 915 ("District courts have broad discretion

to evaluate the irreparability of alleged harm and to make

determinations regarding the propriety of injunctive relief.")

(citation and internal quotation marks omitted).

In this instance the district court determined that

Ross-Simons made the requisite showing because, absent a

restraining order, it would lose incalculable revenues and

sustain harm to its goodwill. The court grounded this

determination on two factual findings. First, due to the

uniqueness of Baccarat crystal, Ross-Simons could not simply

replace the Baccarat line with some other brand, and, without the

availability of Baccarat, its bridal registry business would

suffer. The resultant damage, including lost sales of other

registry items, alienation of future registrants, and harm to its

reputation, would defy accurate quantification. Second, when

Baccarat ceased filling Ross-Simons' orders, Ross-Simons already

had printed and distributed millions of copies of its 1996

catalog,6 and that catalog held Ross-Simons out as an authorized

6Following its usual praxis, Ross-Simons prepared its 1996
catalog in the fall of 1995 and began mailing it later that year.
The catalog identifies Ross-Simons as an authorized Baccarat

17

purveyor of Baccarat crystal. The court found that the inability

to supply products as advertised would wreak substantial (but

immeasurable) damage to the goodwill that Ross-Simons

painstakingly had created over the years. The court dismissed

Baccarat's counter-argument that Ross-Simons' stockpiling of

Baccarat crystal safeguarded it from this type of harm, finding

that Ross-Simons would deplete its beefed-up inventory well

before the litigation ended.

Like the district court, we think that Ross-Simons'

bridal registry business is the focal point of irreparable harm

in this case. Similar to full-line distributors who hawk "one-

stop shopping" as a means of meeting all their customers' needs,

Ross-Simons promotes its bridal registry as offering a complete

line of giftware, including many choices of crystal. Although

not among Ross-Simons' best-selling lines, Baccarat crystal is a

prestigious item a unique, top-shelf line that boasts

considerable allure and that is capable of serving as a beacon to

attract potential customers. In the context of a bridal

registry, as in a variety of other commercial settings, the

availability of a product line is as important, if not more

important, than the amount of sales generated. See, e.g.,

Supermarket Servs., Inc. v. Hartz Mountain Corp., 382 F. Supp.

1248, 1256 (S.D.N.Y. 1974) (noting the importance of offering a

particular brand lest customers go elsewhere). Potential

registrants, unable to include Baccarat crystal among their

dealer and contains a listing of available Baccarat products.

18

selections, may choose not to register at all with Ross-Simons,

enlisting instead with a competitor who offers the full spectrum

of desired products.

To be sure, the district court's findings anent the

bridal registry rest on a number of assumptions about Ross-

Simons' business, its customers' attitudes, and the way in which

the marketplace operates. But the assumptions are reasonable and

are consistent with the available evidence; thus, the court's

subsidiary findings are not unduly speculative. These subsidiary

findings, in turn, are enough to bottom the court's ultimate

finding of irreparable injury. After all, if the court's

subsidiary findings are correct, it could never be shown how many

brides opted not to associate themselves with Ross-Simons because

Baccarat products were unavailable, and it would follow

inexorably that neither the adverse impact on sales nor the

concomitant insult to goodwill could be measured accurately.7

See Interphoto Corp. v. Minolta Corp., 417 F.2d 621, 622 (2d Cir.

7While the district court's finding of irreparable harm is
sustainable on this basis alone, the fact that the 1996 catalogs
already were in circulation when the contretemps arose increases
the threat to Ross-Simons' goodwill. Absent an injunction,
catalog recipients might place orders for Baccarat products,
believing that Ross-Simons could supply advertised items, and
then be disappointed. The harm to Ross-Simons' general goodwill
stemming from its inability to fill such orders likewise would be
incalculable, and, thus, irreparable. See, e.g., Blackwelder

Furniture Co. v. Seilig Mfg. Co., 550 F.2d 189, 196-97 (4th Cir.

1977); Bascom Food Prods. Corp. v. Reese Finer Foods, Inc., 715

F. Supp. 616, 637-38 (D.N.J. 1989) (collecting cases); Robinson

v. United States Postal Serv., 573 F. Supp. 244, 245 (D. Mass.

1983); see also Hypertherm, Inc. v. Precision Prods., Inc., 832

F.2d 697, 700 (1st Cir. 1987) (holding that substantial damage to
business reputation is a sufficient showing of irreparable harm
to justify preliminary injunctive relief).

19

1969) (per curiam); Supermarket Servs., 382 F. Supp. at 1256-57.

This is far from an aberrational result. By its very

nature injury to goodwill and reputation is not easily measured

or fully compensable in damages. Accordingly, this kind of harm

is often held to be irreparable. See, e.g., K-Mart, 875 F.2d at

915; Camel Hair & Cashmere Inst. of Am., Inc. v. Associated Dry

Goods Corp., 799 F.2d 6, 14-15 (1st Cir. 1986). Of particular

interest for purposes of this appeal, several courts have

recognized that the loss of a prestigious brand or product line

may create a threat of irreparable injury if it is likely that

customers (or prospective customers) will turn to competitors who

do not labor under the same handicap. See, e.g., Multi-Channel

TV, 22 F.3d at 552; Jacobson & Co. v. Armstrong Cork Co., 548

F.2d 438, 444-45 (2d Cir. 1977); Bergen Drug Co. v. Parke, Davis

& Co., 307 F.2d 725, 728 (3d Cir. 1962); Hendricks Music Co. v.

Steinway, Inc., 689 F. Supp. 1501, 1512 (N.D. Ill. 1988);

Supermarket Servs., 382 F. Supp. at 1256-57; see also Automatic

Radio Mfg. Co. v. Ford Motor Co., 390 F.2d 113, 116-17 (1st Cir.)

(suggesting in dictum that irreparable harm to a retailer's

goodwill may result from an inability to supply a full line of

products), cert. denied, 391 U.S. 914 (1968); Leone v. Town of

New Shoreham, 534 A.2d 871, 874 (R.I. 1987) (holding that loss of

goodwill due to inability to serve returning customers

constitutes irreparable harm).

Baccarat's other arguments regarding the nature and

degree of the harm that Ross-Simons alleges do not require

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comment.8 Mindful of the preliminary stage of the proceedings,

the strong likelihood that Ross-Simons will prevail on the

merits, and the trial court's broad discretion, we uphold the

finding that Ross-Simons faced irremediable harm if interim

injunctive relief were withheld.

III. CONCLUSION
III. CONCLUSION

We need go no further. Here, the district court

applied the traditional four-part framework to the evidence

before it. In doing so, the court mulled all the appropriate

criteria, eschewed reliance on inappropriate criteria, weighed

the relevant factors with considerable care, and determined that

Ross-Simons made a sufficient showing to justify the issuance of

an injunction pendente lite. Given the case-specific factual

findings that anchor this determination, we cannot say that the

court's action constituted an abuse of discretion.

Affirmed.
Affirmed.

8For example, Baccarat suggests that Ross-Simons could and
still can avoid any harm simply by signing the Proposed
Agreement. This is sheer persiflage. The law much less a
court of equity should not compel a litigant to sign away the
farm in order to save the crops.

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