*1 734 being ques- person
of the office—the
tioned.3 SYSTEMS, COMPUTER
MODERN
INC., Appellant,
v. INC.; SYSTEMS,
MODERN BANKING Banking Systems of Southern
Wisconsin, Appellees. 88-1393.
No. Appeals, Court of
United States
Eighth Circuit. 8, 1988. Dec.
Submitted 29, 1989. March
Dеcided interrogation" majority’s appli- or not disagree sion whether “custodial Similarly, 3. to our to be determined erroneous standard is a matter of law occurred cation of Ante, (relying suppression underlying on policies 728 at review. with the accordance sei- involving wiretaps and searches legal cases zures). of the deter- rule. The nature Miranda split the federal circuit is a There numerous Su- is evidenced mination "custody” ques- ais mixed courts over whether deciding whether cer- preme Court decisions See, e.g., States v. United and fact. tion of law Hocking, "custody" “interroga- constitute tain facts Cir.1988) 769, (7th 772 F.2d 860 Innis, See, e.g., v. 446 Rhode tion.” Island affirming); (mixed Calisto, States v. question, United 1682, 291, L.Ed.2d 297 100 S.Ct. 64 U.S. 711, (3rd Cir.1988) 717-18 838 F.2d 492, Mathiason, (1980); Oregon 429 U.S. 97 v. Jimenez, (same, 602 affirming); States v. United (1977); 714 v. 50 L.Ed.2d S.Ct. Orozco see, Cir.1979). (7th United But 142-43 F.2d Texas, 22 L.Ed.2d 394 U.S. 89 S.Ct. 853, amending, Poole, 794 F.2d 806 States v. appellate (1969). Accordingly, is 311 Cir.1986) (faсt (9th question, revers- F.2d 462 ing); legal con- the trial court’s free to re-examine Mahar, F.2d 801 United States applicability of the Miranda as to the clusion Cir.1986) (same); (6th States United n. 38 appellate review does rule. The standard (5th Cir.1984) Charles, F.2d v. (same, reversing). legal change simply because the determi- Leviston, have depends on the in a Miranda situation nation legal Venerable, F.2d custody as a conclusion. treated 747; see, particular facts of each case. at 807 F.2d But at 304-05. Mesa, F.2d 591 n. 3 Helmel, States v. at United J., Cir.1980) (Adams, concurring). (3rd Com- which circuit over in this A final conclusion Booth, F.2d at 1235-36. appeal pare States v. where the United await an path should to follow view, inappropriate my especially subject and discussion. it is to consideration issue issue, decide it in we must court’s con- do such deference to a district When we light face accord ju- pertinent precedent apply Miranda did not where the district court clusion gener- suppression law risprudence, than rather method of fact- standards and where its relevant ally. confusing muddle on finding leaves us with legal interrogation” term of art is a "Custodial appeal. jurisprudence, a deci- central Miranda *2 concluded that because of a choice of law contract, clause in the MC-MB (not Act) the Minnesota Franchise govern must disputes all par- between the arising ties Second, the contract. court found that carry MC failed to prove burden to that MB’s actions caused irreparable injury integral re- quest for relief. appeal, panel court,
On
of this
in a 2-1
decision,
judg
reversed the district court’s
ment, finding that “the Minnesota Fran
* * * ”
applied
chise Act should be
Computer
that “Modern
has shown a likeli
hood of success on the merits
Computer
Modern
Systems v. Modern
Banking Systems,
(8th
JOHN R. I. BACKGROUND WOLLMAN, BEAM, MAGILL and 22, 1980, Judges, Circuit On October signed en banc. MC and MB gave a contract that rights MC exclusive MAGILL, Judge. Circuit computer distribute MB’s software Computer distributorship agreement Modern Minnesota. The Systems, (MC)ap- Inc. peals was a standard form preset, from the contract with district court’s denial of its nonnegotiable preliminary motion for a terms. The contract injunction pending includ- establishing ed a ruling agree- on the clause that if against merits of its claims engendered litigation ment Banking Systems, (MB). between the Inc. parties, (MB’s gravamen place the laws of Nebraska of MC’scase is MB may business) lawfully govern. terminate MC computer as its software distributor or market software in The contract authorized MC to distribute MC’s territory. alleges, exclusive sales MC computer systems created MB. The alia, inter that violations of the Minnesota systems hardware in the came from the Act, (1986 Minn.Stat. Ch. 80C Corporation. Texas Instruments The ac- Supp.1987), committed MB necessi- companying designed software was and de- requested injunctive tate the veloped by Although MB. it could have
The district court purchased based its denial of directly hardwаre from Texas First, MC’s motion on findings. Instruments, two paid MB premium price MC * Strom, Heaney The Honorable Gerald Lyle W. assumed sen- 1. The Honorable E. United States ior status on December Judge Chief District for the District of Nebraska. ** The Honorable Theodore McMillian concurred majority opinion
in the participate but did not opinion in the final vote on the due to illness. market; into the expand Wisconsin MB software to obtain it in order purchase require MC to MB could bank- whether use commercial (which facilitates hardware; Instruments its Texas establishments) well. ing *3 require hardware/soft- MB could whether purchased $3.6 over had By MC sales; MB’s whether tie-in ware from systems computer million worth more than charging distributors eighty-six list a client MB and amassed was lawful. licensees region in which in the financial institutions on October dismissed was grew from The suit MC systems. MB it distributed court distriсt exer The Minnesota a thriv- 1987. up” operation to “start two-man a right not to assert discretionary its employees. cised twenty-five ing company with in the parties, the dis because jurisdiction it re- degree, However, to a substantial selection agreement’s forum tributorship on its con- financially dependent mained Doug clause, venue agreed “to exclusive MB; seventy over relationship tinuing any litigation be County, Nebraska re- las in some business was percent of MC’s concerning this contract.” them tween and maintenance to the sale related spects v. Computer Systems Modern supplies Modern and the sale systems of MB 104618,slip op., Da Banking Systems, No. systems purchasers. by MB required Minnesota, County, October kota computer installed expanded, it As MC opinion).2 memorandum (unpublished institutions more than 400 systems in to supported its decision en- The court All of its States. throughout the United clause with the forum selection North force of Minnesota and outside commerce precedent: Supreme Court to MB and Minnesota entirely unrelated was Dakota zone for agree distribution products. parties MC’s to a contract its the “[WJhen to grew from Minnesota alone products arising that contract MB from actions that Minnesota, forum, Da- North region comprising particular brought in a will be and, years, Dakota. given for two South kota be effect agreement should that Wisconsin, into sought expand party seeking by MC the it is shown unless by doing so prevented do so MB that but to avoid market threatening enter Minnesota or unreasonable.” unfair expansion competitor therefore, if MC’s law, a direct en- as favors plans persisted. clauses. selection forcement of forum Bermeister, & (quoting Hauenstein to convert its dis- Id. MB decided Industries, excep- v. MET-FAB With the Inc. into licensees. tributors (Minn.1982)). MC, N.W.2d 886 of the erstwhile distributors all tion li- MB’s demand for new acceded to that Minneso to emphasizing In addition Because MC arrangement. censor-licensee ta law favors enforcement contract, began MB alter its refused to not unreasonable fo and otherwise worded distributor, MC, more for its charge as a clauses, dis rum selection charged licensees. than it software raised another ratio obliquely court trict MB’s denying motion: ac for MC’s nale relationship with way Alarmed irreparable harm to MC. tions caused deteriorated, against filed suit MC MB had “[tjhere that is no evi court reasoned August court on MB in Minnesota state * * * could not have ac dence declaration of its requestеd [MC] MC 1987. computer suitable for quired software distributorship agreement rights under the any source. Plaintiff banking from other MC could they pertained to whether underlying opin- dis- unpublished action.” Since Ordinarily, cite we do not Eighth Rule to those putes Circuit Local instant are identical ions in this circuit. in the case 8(i) opin- case, 8(i) party an cite indicates Rule "[no] au- the Minnesota district publication See, ion that was intended e.g., Mabry, Jones thorizes this citation. or state court *." other federal (1983) (there improprie- is no However, 8(i) goes excep- to make an Rule on opinion unpublished when ty in the use of of an cases related virtue tion "when the identity are identical). action are causes of or the causes between purchase comput trary himself states he can to the laws or policies fundamental dirеctly.” Computer er Accordingly, hardware Minnesota. the court denied Systems Banking Systems, request v. Modern No. MC’s injunctive 104618,slip op., County, Minnesota, Dakota II. DISCUSSION (unpublished
October memoran opinion). dum We with the district court’s conclu- concerning sions both of this case’s salient claim, After the dismissal of MC’s state issues. Our review of the record convinces MB commenced a breach of contract action us that MC failed irrepara- to establish the against inMC Nebraska state court.3 The injury required ble to necessitate flourish, litigation continued to as MC filed *4 Moreover, relief. we that no funda- the instant action the United States Dis- mental of Minnesota overrides trict Court for the District of Nebraska. the choice of agreed upon law MC’s new suit contained a multitude of in the distributorship agree- allegations, charging MB with interferencе ment. prospective relations, contractual def- amation, contract, promissory breach of es- A. Irreparable Injury No violations, toppel, competi- antitrust unfair tion, and violations of the Minnesota Fran- The proving burden of pre that a liminary injunction5 chise Act and the Wisconsin Fair Dealer- should be issued rests ship sought entirely preliminary injunc- law. MC with the movant. Corp. See Gelco Partners, forbidding 414, tion the termination v. Coniston of the MC- 811 F.2d 418 (8th Cir.1987); distributorship agreement Dole, MB Jensen v. MC-MB 677 F.2d (8th Cir.1982). 680 competition pending ruling in Minnesota on Unless the district n injunctive court’s denial of the merits of MC’s claims. relief is the product of an abuse of discretion or mis court, emphasizing district the ab- The placed reliance on an legal prem erroneous irreparable injury, sence of also denied ise, See, we appeal. rеverse on preliminary injunction.4 MC’s motion for a e.g., Calvin Klein Corp. Cosmetics v. Le Ultimately, the court concluded that MC Laboratories, nox 815 F.2d 503 pushed would not be to the brink of extinc- (8th Cir.1987); Wyrick, Randall v. 642 (with irreparably damaged goodwill tion (8th Cir.1981). F.2d 308 reputation) injunctive absent contrary, On the the court concluded MC In this court convened en banc survive, perhaps nearly financially could “clarify applied by standard to be intact, by pursuing other avenues of busi- the district courts in this circuit consider ness, viz., maintenance empha- ing requests service and preliminary injunctive re sis on clients outside Minnesota and Dataphase Systems, North lief.” Sys Inc. v. CL analyzed tems, Inc., Dakota. The district court (1981) (en also 112 distributorship agreement’s banc). choice of Dataphase emphasized court clause, concluding law that the deciding pre se- that when whether to issue a lection of govern disputes Nebraska law to liminary injunction, a district court must arising out of the was enforce- consider four relevant factors: the threat reasonable, since it agreed upon movant, able was irreparable harm to the mutually language, in clear and not con- balance between irreparable such harm and Supreme 3. MC then removed the case gov- to federal court. Court has held that federal law courts, procedural erns all issues in federal re- diversity jurisdiction 4. Federal in this case is Therefore, gardless jurisdiction. of the basis of pursuant to 28 U.S.C. §§ and 1337. applicable Federal Rule of Civil Procedure case, (in 65) this Fed.R.Civ.P. must be used pre- 5. When this court evaluates a motion for corresponding proce- relief, instead of a state rule liminary injunctive we do so in accord- dure when a conflict arises between them. ance with Rule 65 of the Rules of Federal Civil Plumer, Hanna v. Procedure and relevant diversity jurisdiction 380 U.S. 85 S.Ct. federal case law. cases, Clinic, (1965); apply Hughes Mayo we L.Ed.2d 8 federal in- (8th Cir.1987). stead of state law because the United States F.2d Law re- B. Choice injunctive harm corresponding par- interested on other inflict lief would assume, arguendo, that if we Even on prospects success ties, irrep the movant’s issue proved the threshold hasMC at interest. Id. merits, public proceeded MC then and that arable harm bal- re then stated under the cogent argument “[i]n 113. The construct single analysis, factor is Dataphase no equities[,] ancing the mainder of district However, moving one affirm nevertheless Id. determinative.” pursuant relief court’s denial required injunction preliminary for a are Act. We to the irreparable harm. threat show the clause in that the choice of convinced irreparable finding of fact, aof absence pre distributorship agreement the MC-MB vacating a grounds for injury is sufficient application of Minnesota cludes the at injunction. Id. preliminary dispute. this denying not err in court did The district inserting an anti- argues that MC case relief preliminary injunctive Act, Minne- in its Franchise clause waiver irreparable caused MB’sactions because a fundamental expressed sota did not The district court injury to MC. *5 party agreement. via opposing waiver rely on an erroneous or its discretion abuse continues, argument over- policy, the This that MC it concluded when legal premise in the distrib- of law clause rides the choice harm if MB irreparable would not sustain that this We аgreement. believe utorship distributorship agreement terminated the applica- the argument underestimates both competition with direct entered into and Merchandising Co. v. bility of Tele-Save in of customers patronage for the MC Co., 814 F.2d Distributing Consumers the As North Dakota. Minnesota and Cir.1987), the (6th to this case and purchase is free to emphasized, MC court it possessed when bargaining power MC Texas directly from Instruments. hardware distributorship agreement. signed the pur- addition, MC nothing prevents Therefore, agree once more with the we from an- requirements chasing its software district court. of the conclusions Moreover, MC los- even if company. other Tele-Save, upheld a the Circuit Sixth has sold to whom it eighty-six clients es the supply agree- in a provision choice lawof will still have customer systems, MB of an Ohio stat- despite the existence ment record contains in excess of 310. The base Act) (like ute the Minnesota dealings that MC’s abundant indications provision. The court a non-waiver includes significantly in the with MB have dwindled of law enforce the choice chose to sig- that MC has years and other last two (1) following parties the reasons: the (encompassing nificant of business avenues the to be agreed in advance to had maintenance) despite the both sales and (2) disputes; contacts be- applied in future relationship MB. of the deterioration with fairly evenly divid- parties were tween the irreparably not in the con- Finally, MC will be the state selected ed between state; (3) the plaintiff’s of its motion because home harmed the denial tract and relief, bargaining unequal it will not of injunctive parties were with or without (4) application of the law strength; if suc- and remedy at law it adequate have an repugnant chosen in the contract was establishing the merits its sub- ceeds plaintiff’s state. to the allegations of antitrust violation stantive Id. at 1123. damages (with treble its concomitant defamation, termination, victors), wrongful employed in analysis like that Tele- An contract, et cetera. breach must that the same result be Save reveals in this case. reached injury, irreparable Finding proof Dataphase con- analysis, arguments concerning conclude the choice of we our MC’s misun- that the decision of district contain two fundamental vinced law issue First, derstandings. relief not an will examine grant not to was later, assumption is incorrect MC abuse of discretion. stronger parties agree has the state that this shall be Second, governed in this сase. we do not interest the laws of Nebraska.” that a fundamental As for the division of contacts between (protection companies of in-state potential and the two forum Act) by the Minnesota Franchise overrides states, they we believe fairly evenly are light choice of the of the divided between Nebraska and Minnesota. reasoning in Tele-Save. Nebraska is MB’s state of incorporation The Minnesota Franchise Act was principal business, place of the site of adopted years ago. protects sixteen It negotiation signing of the MC-MB franchisees Minnesota from unreason agreement, and the state named in the by powerful able or abusive treatment choice of law clause. Minnesota is the Peterson, Clapp franchisors. See place performance contract, MC’s (Minn.1982); N.W.2d Martin In place incorporation, and the home of a vestors, Bie, Inc. v. Vander great deal of MC’s clientele. We conclude (Minn.1978). qualify To for the that this “fairly even division” satisfies the protection, Act’s a Minnesota franchisee requirement in Tele-Save. (1) right must: have a to use the fran Next, we must consider the rela symbol; chisor’s trade name or commercial tive levels of bargaining power. In an community share a of interests case, earlier incarnation of this the Minne marketing goods franchisor court, sota district supra pp. 736-737, see services; required pay a fran specifically found that at the time of their 80C.01(4). chise fee. gen Minn.Stat. agreement, MC and MB were not of un *6 erally RJM Marketing, Sales and Inc. v. equal bargaining power. Modern Com 1368, Corp., F.Supp. Products 546 Banfi puter Systems Banking v. Modern Sys (D.Minn.1982); 1373 Chasе Manhattan tems, 104618, No. slip op., County, Dakota Rental, Inc., v. Bank Clusiau Sales and Minnesota, 19, (unpublished October 1987 490, (Minn. 1981). 308 N.W.2d 492 opinion). memorandum The court conclud imposes The Act a procedural number of ed that contract is not adhesive. “[t]he requirements, demands factual disclosures There is no great disparity evidence of a franchisors, regulates would-be ter bargaining power between the mination of remedy franchises. The sole * * *.” Id. offered inequitable Act for unfair or Although recognize we that the litera- termination of franchises is re franchising ture of is strewn law with re- 80C.02, .04, lief. See Minn.Stat. ports sophisticated financially pow- .06, .14(1),.14(3); Mason v. Farmers Insur erful taking advantage franchisors of rela- Cos., (Minn. ance 281 N.W.2d 348 franchisees, tively inexperienced we do not 1979). believe that the facts in this case fit that 80C.21, The provision, anti-waivеr stereotype. This matter involves multi-mil- reads as follows: dealings computer lion-dollar two between Any condition, stipulation or companies with nationwide clienteles. To purporting any person acquiring to bind give protection MC the benefit of under the any compliance franchise to waive Franchising they Act after any provision of sections 80C.01 to knowingly (without attempting waived it 80C.22 rule or order thereunder is negotiate for more favorable choice of law void. terms) unduly paternalistic. would be Having briefly set out the essential con- oppressive, Some evidence of unreasonable Act, proceed apply tent of the now superior bargaining posi- or unfair use of analysis developed in Tele-Save. tion, adhesion, as in contract of is re- quired party justifiably Neither denies that the before a court can dis- distributor- ship agreement regard mutually agreed upon established the law to be choice disputes. used in future Paragraph 16 of law clause. No such extreme circumstanc- agreement plainly states Accordingly, that es exist this case. we see “[t]he 740 of Law Enforceability of the Choice I. that MC’s and us
nothing persuades that Provision power were bargaining MB’s levels agree- of their the time widely disparate at that majority The determines ment. dispute. apply to this does not law or Minnesota argu- deciding by MC’s whether Last, unpersuaded we are action, court policy of a federal district governs this a fundamental ment that sitting choice of law must follow Nebras- in Nebraska Minnesota overrides of Minneso- rules. Klaxon Co. requires application conflict of laws clause and ka’s Co., Act un- Mfg. 313 U.S. The Minnesota Electric ta law. v. Stentor 1020, 1021, in favor 1477 deniably 85 L.Ed. does evince 61 S.Ct. Inns, remedies offering (1941); in Minnesota Holiday franchisees Birdsell v. under tradi- (8th Cir.1988). those available greater than district pow- law, also see a but we tional common follows determined that Nebraska countervailing policy: Minnesota’s (Second) erful Restatement Conflicts willingness to enforce traditional Law, courts have and noted that Nebraska Milliken agreements: see choice of law past provisions choice of law honored Co., 295 N.W. Packaging Eagle and Co. v. Dain, v. Kalman & cases. See Shull (1980)(when agree that the 2d 377 Quail, Inc., 201 Neb. govern their state shall of another (1978); Exchange Bank & Trust Co. interpret courts will agreement, Minnesota Tamerius, 807, 265 N.W.2d 200 Neb. such of the state where apply the law (1978). made); Insur- is Combined provision in the distrib- The choiсe of law Bode, 247 Minn. America v. ance Co. of it “shall be agreement provides utor (parties to a N.W.2d governed by the laws of the State of Ne- acting good faith and without contract provision implicates section This braska.” an intent to evade the law provides: Restatement which 187 of the the contract of the state which by the Parties Laws of the State Chosen interpretation). govern its made shall of the state chosen The law *7 rights parties govern their contractual III. CONCLUSION applied particu- if the and duties will be did not abuse its discre- The district court parties could lar issue is one which the legal premise rely tion or on an erroneous in by explicit provision an have resolved that MC sustained when it concluded agreement issue. their directed to that resulting from MB’s ac- irreparable harm by The of the state chosen the law parties’ choice of law tions and that the parties govern rights their contractual Therefore, the clause was enforceable. applied, even if the and duties will be prelimi- court’s denial of MC’s motion parties particular issue is one which the nary injunctive pursuant relief by explicit could not have resolved Minnesota Franchise Act is affirmed. provision agreement in their directed to issue, unless either HEANEY, Judge, Circuit Senior (a) the chosen state has no substantial LAY, Judge, joins, whom Chief relationship parties to the or the transac- dissenting. tion and there is no other reasonable choice, or basis for the respectfully majority
I The dissent. (b) application of the chosen opinion foreign franchisors to avoid law allows contrary Fran- state to a fundamental applicability of the Minnesota would be enforcing materially policy Act. I the choice of of a state which has a chise believe greater provision Computer’s law nullifies Modern interest than the chosen state Act, violating statutory rights particular under this the determination of the issue which, articulated of the State under the rule of § applicable of Minnesota. would be the state of the law expectations of an the absence effective choice of is not the only value in con- parties. law; regard tract must also be had for state regulation.” interests and state contrary In the absence of a indica- intention, tion of the reference is to the question There is no that Minnesota has local law of the state of the chosen law. greater interest in the issue of whether (Seсond) public Restatement Conflict Laws would void the choice of (1971). provision. I equally think it § clear that significant Minnesota has the most rela- step The first is to determine whether tionship to the transaction.1 the contested issue is one which could have provision. been resolved a contractual First, Nebraska has declined to take Inc., Munford, F.Supp. See Sheldon regulating interest in franchises outside of (N.D.Ind.1987) (court enforced Although Nebraska. ahas fran- provision agree- choice of law franchise chise statute similar Minnesota, to that of included, ment because could have see, Neb.Rev.Stat. 87-401 seq., et section provision and did include as to the contest- 87-403(1) provides that the Nebraska act grant territory ed agree- exclusive in the only applies “to a perform- franchise the ment). 187(1) Comment c to section indi- contemplates ance of which requires or dispute cates that if the centers on rules franchise to place establish or maintain a construction, relating to to conditions business within the State of Nebraska precedent subsequent, sufficiency Minnesota, *.” hand, on the other has performance or to nonperform- significant excuse for in regulating interest ance, apply provisions the forum should Computers between Modern of the chosen law. Comment d Banking to section Modern attempted and has to do 187(2) examples cites questions by enacting which so the Minnesota Franchise typically cannot by explicit be determined Act. Group, See Barnes Inc. v. C & C agreement: formalities, capacity, Products, substan- (4th validity, tial illegality. Cir.1983) (per curiam) (Alabama’s issue interest casе is more dispute than a over regulating contract relationships business within interpretation; rather, essential- materially greater the state is than Ohio’s ly dispute legality generalized the choice-of-law protecting interest in the inter- provision itself. do not see how either state domiciliary). contracts of its party could have avoided this issue stat- Second, Minnesota has more material ing in the contract that the does “contacts” with this transaction. Nebras- not violate Minnesota policy. primary ka’s contact is that Modern Bank- step
The next
is to determine
*8
ing
place
whether
has its
of business there and the
187(2)(b),
under section
Minnesota has a
signed
distributor
was
there.
materially greater
Minnesota, however,
interest than Nebraska
place
per-
is the
of
issue,
in the outcome of this
contract,
and whether
formancе of the
as well as the
Minnesota would be the
appli- place
state of the
incorporation
of
Comput-
of Modern
if
provision
cable law no choice of law
had
ers.
Banking
Modern
product
delivers its
g
been made. Comment
reflects the ratio-
to Minnesota and enters into contractual
nale for this:
“Fulfillment of the
arrangements in Minnesota with Minnesota
that,
provides
1. Section 188 of the
conjunction
Restatement
principles
must be read in
with the
in the
Restatement,
absence of an effective choice of law
contained in section 6 of the
parties,
governing
the
the
any statutory
will be that of the
which include
directives on choice
significant
state;
state
relationship
which has the most
of law in the forum
the needs of the
transaction,
(1)
considering
place
to the
systems;
the
of
interstate and international
relevant
contracting; (2)
place
negotiation
forum;
policies
the
of
of
policies
the
of the
relevant
of other
contract; (3)
(4)
place
performance;
the
the
interested states and their interest in resolution
contract,
subject
location of the
dispute; protection
justified
matter of the
expecta-
of the
domicile, residence,
tions;
and
nationality,
the
policies underlying
particular
basic
the
place
law;
incorporation
place
and
certainty,
of business of
predictability
field of
and uni-
parties.
(Second)
result;
formity
Restatement
Conflicts of
and ease in the determination
188(2).
Laws §
Section
application
the Restatement
applied.
of the law to be
Second,
Practices
Franchise
Nebraska’s
paсk-
its software
use of
customers
the
franchisees within
only extends to
Act
the
Clearly, Minnesota
ages.
Thus,
application
Nebraska.
State of
choice of
if no
applicable law
of the
state
Computers
leave
law will
Modern
existed.
provision
under either
available
the remedies
without
is to
section
step
final
under
ne-
an outcome
act. Such
state franchise
application of Nebraska
whether
determine
legislature
the
to of-
gates
decision of
the
Minne-
policy of
a fundamental
law violates
protec-
more
Minnesota
fer franchisees
enforce
Specifically,
sota.
reme-
common law
the traditional
tion than
the stat-
do so eliminates
when to
provision
regu-
dies,
proven
had
ineffective
which
Com-
provided to Modern
utory remedies
industry.
franchise
lating
the
abuses
Act?
puters by the
Note,
Franchising, 59
Regulation
See
majority, Mod-
Contrary to the views
(1975).3
1028-36
Minn.L.Rev.
seek to invalidate
does not
Computers
ern
Third,
applica-
any attempt to narrow the
provision because
of law
the choice
Franchise Act has
bility of the Minnesota
con-
agreement is an adhesion
distributor
public policy.
found to violate
been
to invalidate
it wish
tract. Nor does
Bank, N.A. v. Clusiau
Manhattan
Chase
Banking
su-
has
Modern
provision because
(Minn.1981),
Sales,
the Su-
308 N.W.2d
it took ad-
power which
perior bargaining
fran-
held
a
preme Court Minnesota
Rather,
during negotiations.
vantage of
a fran-
agreement provision which
chise
to invalidate
Computer seeks
Modern
against a fran-
all defenses
chisee waived
it limits its
provision
of law
because
choice
reach of the
chisor narrowed
remedial
against
franchisee
rights
remedies
Act, thereby violating
Minnesota Franchise
Thus,
focus should be
a franchisor.
policy. It wrote: “As the trial
state
rights and
Computer’s
whether
out,
of waiver of
pointed
enforcement
so,
limited,
if
have
remedies
been
against Minnesota resi-
provision
defense
violates Minneso-
a limitation
such
whether
agree-
franchise
dents who have entered
public policy.
ta
failed to com-
franchisors who
ments with
franchise statute would ad-
provides: ply with the
First,
80C.21
MinmStat. §
of that
versely
reach
affect
remedial
condition,
provision
stipulation or
“Any
* * *
of de-
We
statute.
hold
acquiring
[waiver
any person
purporting to bind
contrary
provisions
any
fense]
compliance with
any
franchise waive
at 494.
to 80C.22
provision of
80C.01
sections
is void.
order thereunder
any rule or
provision
present
in the
The сhoice of law
D
subpt.
pt. 2860.4400
also Minn.Rules
the remedial reach of
similarly affects
case
from re-
franchisor
(prohibits any
Act.
It
the Minnesota Franchise
becomes
rights statutorily
term
franchisee to
of all
quiring a
in effect a waiver
any person
Computers, a waiver
relieves
to Modern
contract which
afforded
Act).2
by Minn.Stat.
80C.21.
rendered void
liability imposed
§
agreed
interpretation
87-406(1)
with the
an anti-
one commentator
contains
2. Neb.Rev.Stat.
Attorney
found in section
General:
to that
advanced
waiver
similar
provides:
80C.21. It
and franchise re-
State franchise disclosure
87-401 to
of sections
It shall be violation
*9
statutes, however,
lationship/termination
fre-
franchisor, directly
any
or indi-
87-410 for
provisions
directly
quently
or in-
contain
officer, agent
employ-
through any
rectly,
provisions inappli-
directly
make choicе of
ee,
following practices:
engage
any of the
to
deprive
would be to
a
cable
their
if
effect
of
require
franchisee at the time
To
a
protections
resident
of
of
franchisee
arrangement
* * *
entering
to as-
a
into
franchise
purport
Such statutes
state's laws.
novation,
release, assignment,
waiv-
sent to a
law, and for that
express a rule of substantive
person
estoppel
relieve
er or
would
which
reason,
(such as
of law rules
state choice
by
liability imposed
sections 87-401 to
Restatement)
not
do
those contained
87-410;
*.
play.
void the
statute renders
come into
The
87-406(1) (1977).
§
Neb.Rev.Stat
substantive
party’s
law as a matter
choice
Jurisdiction,
law.
Law and Choice
In
Choice
(footnotes
citing Minn.Stat.
80C.21
King Corp.
§
Id. at
Burger
Venue in the Wake of
omitted,
added).
Rudzewicz,
(1987),
emphasis
Digest
Legal
3 Franchise
”
Finally,
majority
heavily
upon
relies
on
that state’s
policy.’
‘fundamental
Merchandising
Thus,
Tele-Save
v. Consumers
744
clause,
Banking’s choice of law
ern
irreparably
party will be
whether a
sess
remedy
any adequate
majority removes
Ritt
issues. See
injunction
harmed if
neither
Computers
to Modern
available
Oil, Inc.,
857,
860-
624 F.2d
miller v. Blex
nor
franchise act
Minnesota’s
Nebraska’s
(8th Cir.1980) (Court examined issue of
62
ade-
of an
to this case. The lack
applies
claim).
legal
each
irreparable injury under
granting
for
quate
remedy provides a basis
in Rittmiller
recognize
this Court
injunctive
limited the
many other Circuits have
and
can be
Furthermore,
a distributor
portion
situations in which
a substantial
injunction.6 See
is
preliminary
Computers
business
derived
awarded
Modern
Banking.
Rittmiller,
(antitrust
relationship with Modern
F.2d at 861-62
from its
624
Comput
law);
of Modern
Approximately
remedy at
72.5%
damages an available
and mainte
Co.,
involves the sale
Baldwin
er’s business
Inc. v.
Kahn Music
Jackson
software,
Banking’s
nance of Modern
755,
(2d
763
Organ,
&
604 F.2d
Piano
hardware, and the
and maintenance of
sale
Cir.1979)
loss
(plaintiff failed to show that
banking
using
supplies to
customers
sale of
products
result
franchisor’s
would
Banking’s
processing system.
data
Modern
that sale of franchisor’s
lost customers or
Computers
pre
Modern
would
While
plain
cornerstone of
products constituted
these ser
performing
some of
cluded
efforts).
marketing
tiff’s
vices,
very significant per
lose
it would
remember, however, that state
We must
centage
and an immeasura
business
enacted because of the
franchise acts were
Hull,
See John B.
goodwill.
amount of
ble
anti-
inadequacy of the common law and
Petroleum,
24,
Waterbury
Inc. v.
See
for franchisees.
59
trust
remedies
denied, 440 U.S.
960,
(2d Cir.1978),
cert.
29
(common law ac-
Minn.L.Rev. at 1028-36
1502,
(prelim
tion Minn.Stat. § damages,
provides for excludes section
80C.14, notice, outlining the section good requirements
cure and cause for ter-
mination. See also Mason v. Farmers Ins.
Co., (Minn.1979) (in- only remedy
junctive relief is the available 80C.14). By
for violation of Minn.Stat. §
making injunctive remedy, relief the sole Legislature appears
the Minnesota to have
expressed inadequacy that the remedy statutorily presumed at law is good
when there is a termination without proper
cause or notice. I provi-
Because believe the choice of law
sion in the distributor violates a Minnesota,
fundamental refuse to enforce it this case. As Computers
I feel that Modern has no ade- quate remedy under either law, I judg- would reverse the denying
ment of the district court
Computer’s request preliminary
NATIONAL LABOR RELATIONS
BOARD, Petitioner,
v. COMPANY, Respondent,
W.L. MILLER
Eastern Missouri Laborers District Council, Intervenor/Petitioner.
EASTERN MISSOURI LABORERS COUNCIL, Petitioner,
DISTRICT COMPANY,
W.L. MILLER
National Labor Relations Board, Respondent. 87-2332,
Nos. 87-2420. Appeals,
United States Court of
Eighth Circuit.
Submitted June 1988.
Decided March