author: PELL, Circuit Judge.

text:
    PACKARD BELL ELECTRONICS CORP., Plaintiff-Appellee, v. Elliott ETS-HOKIN, Defendant-Appellant.
    No. 74-1107.
    United States Court of Appeals, Seventh Circuit.
    Argued Sept. 10, 1974.
    Decided Jan. 16, 1975.

      S. Joseph Formusa, Chicago, Ill., for defendant-appellant.
    Reuben L. Hedlund, Thomas F. Gardner, Chicago, Ill., for plaintiff-appellee.
    Before FAIRCHILD, PELL and TONE, Circuit Judges.
   PELL, Circuit Judge.

The plaintiff-appellee Packard Bell Electronics Corporation (Packard Bell) brought this action for breach of contract against its former franchise wholesale distributor, Elliott Ets-Hokin. In its complaint, Packard Bell alleged two alternative theories: (1) that payment was due on two promissory notes executed by Ets-Hokin in favor of Packard Bell (Count I) and, (2) that Ets-Hokin was liable for the sum under a Continuing Guaranty which he had signed (Count II). Jurisdiction is based on diversity of citizenship.

Following a bench trial, the district court, finding that the promissory notes in question had been paid, dismissed Count I. The court, however, found in favor of Packard Bell on Count II on the ground that Ets-Hokin was equitably es-topped from denying his liability under the guaranty. Judgment was entered against Ets-Hokin in the amount of $379,599.55 plus plaintiff’s costs and attorney’s fees. Ets-Hokin appeals from the district court’s decision on Count II.

The principal issue on appeal is whether the doctrine of equitable estoppel was properly applied in this case.

I

On February 24, 1961, the plaintiff and the defendant entered into a franchise agreement, pursuant to which the Elliott Company, a sole proprietorship, became a wholesale distributor of the products of Packard Bell, a California corporation. The Elliott Company was to operate in specified counties of Arizona. On the same date that the distributor agreement was signed, Elliott Ets-Hokin and his then wife, Michele Ets-Hokin, executed a Continuing Guaranty, whereby they jointly and severally guaranteed to pay to Packard Bell “any and all indebtedness of Elliott Ets-Hokin dba The Elliott Company.” Elliott Ets-Hokin was, by this instrument, merely guaranteeing his own obligation and, therefore, the principal significance of the document was to add Michele Ets-Hokin as obligor although the Guaranty did provide for collection costs and attorney’s fees.

Renewal distributor agreements, substantially identical to the original agreement, were subsequently executed by the parties. The last such agreement was executed in 1964 and provided for automatic extension from year to year absent written notice of termination prior to the end of any annual year. In the 1964 agreement, the distributor was identified as “Elliott Ets Hokin dba The Elliott Company.”

In August 1968, Ets-Hokin caused an Arizona corporation to be formed to take over and carry on the business of the sole proprietorship. The corporation, operating under the name “Elliott Distributing Company, Inc.,” commenced doing business on January 1, 1969. In March 1969, a second corporation, Elliott Distributing Company of Tucson, Inc., was established by Ets-Hokin to take over and carry on the business of the distributorship in the Tucson area. The first-formed corporation thereafter handled only the business in the Phoenix area. The evidence clearly indicated that Packard Bell, through some of its agents and employees, knew of both Ets-Hokin’s plans to incorporate and the actual incorporations.

No franchise distributor agreement was ever entered into between Packard Bell and either the Phoenix corporation or the Tucson corporation.

Packard Bell maintained several accounts for the distributorship. Merchandise was shipped by Packard Bell and billed to an “open” account upon which no interest was charged. A “note account,” upon which interest was charged, was established for the defendant as a means of handling overdue balances. When payment was in arrears, Packard Bell would periodically clear the open accounts by means of bookkeeping entries: Packard Bell would credit the open accounts and would debit, by a corresponding amount, the note account. Generally Packard Bell obtained a signed personal demand note from Ets-Hokin for the debits in the note account. Some transfers, however, were made to the note account without Ets-Hokin having signed a personal note and ultimately he declined to sign further personal notes although under pressure to do so by the threat that the distributorships would be terminated.

At the close of business of the sole proprietorship at the end of 1968, the distributorship was indebted to Packard Bell in the amount of $929,237, which included $212,000 then outstanding on the note account. The notes sued upon in Count I of this litigation were two personal notes signed by Ets-Hokin in January and March of 1969 to cover amounts in the accounts due from the sole proprietorship. These notes totalled $640,000 and were the last personal notes signed by Ets-Hokin.

When the Elliott Distributing Company, Inc. commenced the business of the distributorship in January 1969, the corporation did not disavow the debts of the sole proprietorship. Rather, it received statements of this indebtedness from Packard Bell and made payments toward the accounts. Subsequent to the incorporations, Packard Bell sold approximately $2,000,000’s worth of merchandise to the corporations, with over one million dollars being transferred to the note accounts, despite the fact that Ets-Hokin did not sign additional personal notes. In late 1970, Security Agreements and Financing Statements on behalf of both corporations were signed and delivered to Packard Bell.

In July 1971, the distributorships were indebted to Packard Bell in the amount of $583,159.29. Due to repossessions and collections by Packard Bell, the debt was reduced by the district court to $379,-599.55. This amount, plus costs and attorney’s fees, was awarded below to Packard Bell.

II

Packard Bell claimed (in Count II of its complaint) that Ets-Hokin was liable for this indebtedness under the Continuing Guaranty, which the defendant had signed in 1961. As the district court noted, and as Packard Bell concedes, this guaranty related solely to the indebtedness incurred by the sole proprietorship and does not by its terms extend to the debts of the corporations. The district court, however, agreed with Packard Bell that the doctrine of equitable estoppel applied to prevent Ets-Hokin from raising the incorporation of the distributorship to defeat the operation of the guaranty.

Equitable estoppel arises “only when one has so acted as to mislead another and the one thus misled has relied upon the action of the inducing party to his prejudice.” Lebold v. Inland Steel Co., 125 F.2d 369, 375 (7th Cir. 1941), cert. denied, 316 U.S. 675, 62 S.Ct. 1045, 86 L.Ed. 1749. Reliance is an essential element of equitable estoppel and absent reliance, the doctrine does not apply. See Lebold v. Inland Steel Co., supra; United States Fidelity & Guaranty Co. v. Stewart’s Downtown Motors, 336 F.2d 549, 556 (9th Cir. 1964); Safeco Insurance Co. v. Franklin, 185 F.Supp. 499, 501 (N.D.Cal.1960).

In the present case, agents of Packard Bell not only knew of the incorporation of the distributorship, but they had discussed the possibility of incorporation with the defendant prior to the establishment of the corporations and had given Ets-Hokin permission to go ahead with the incorporation. Packard Bell’s treasurer admitted that during his discussions with Ets-Hokin concerning the incorporation, the guaranty was not mentioned. After the corporations were formed, Packard Bell changed its accounting books to reflect the incorporation of the distributorship.

We are not presented here with the case of a guileless and unsophisticated investor being overreached or affirmatively misled. The correspondence although often couched in informal terms insofar as the relationship of the parties was concerned reflected that Packard Bell was not only an aggressive merchandiser but was not a lethargic collector.

Yet not until approximately two years after the first corporation commenced operations did Packard Bell assert that Ets-Hokin remained liable upon the instrument signed some ten years earlier which by its explicit terms pertained only to the obligations of the individual proprietorship. Indeed from the outset and throughout the decade or so of this business relationship the guaranty was of equivocal significance insofar as Ets-Hokin was concerned. It appears rather obvious that the main purpose of the original guaranty was to secure the additional backing of Ets-Hokin’s spouse, a not uncommon procedure amongst lending institutions and others advancing credit to individuals. The judgment creditor of the husband not infrequently finds that he is unable to satisfy his judgment because the property, the appearance of which being that on which he was relying is in the wife’s name or his held in a joint tenancy arrangement. Insofar as principal amounts were concerned no purpose was served in having Ets-Hokin as a signatory on the guaranty as he was already fully obligated for the payment of all merchandise purchased as he was the sole proprietor. It is true that this pot-boiler form, although it had provisions having no applicability to the Ets-Hokin sole proprietorship situation, did purport to waive certain rights customarily enjoyed by debtors and did provide for the payment of attorney’s fees and collection costs. Nevertheless, it would appear that the significance of the guaranty was rather minimal insofar as Ets-Hokin was concerned.

When the first corporation commenced business and during the period prior thereto when Packard Bell consented to the change of business form there was never any indication that Packard Bell either was wanting a new individual guaranty of the corporation indebtedness or was relying on the seven year old instrument. Instead Packard Bell went by another route. Within fifteen days after the corporation commenced business, Packard Bell had secured from Ets-Hokin a promissory note for $300,000.00 and two months later a. second note for $340,000.00. These notes not only provided for attorney’s fees but also for interest at seven percent. The guaranty did not include an interest provision. The principal amounts of the notes were approximately equivalent in March 1969 to the accounts of the distributorship owing to Packard Bell.

Inquiries from Packard Bell as to Ets-Hokin’s personal financial condition, although not developing for nearly two years after the execution of the notes, are readily understandable, not because of the ancient guaranty but because of the current promissory notes. Nevertheless at about the time Packard Bell was evincing interest in Ets-Hokin’s financial condition it took other steps to protect its creditor’s position. In October, 1970, writing Ets-Hokin’s attorney “[w]e have been financing both of the subject corporations and to justify our large line of credit and to permit us to continue to make shipments of new merchandise as required and work with Mr. Ets-Hokin on other arrangement which will be of benefit to both of us,” Packard Bell asked that “all-inclusive” Security Agreements be executed. These were in due course executed and the following year Packard Bell terminated the distributorships apparently feeling secure in having promissory individual notes of $640,000 plus a tight lien interest on all merchandise. The repossessions pursuant to the Security Agreements resulted in a net balance due of less than $400,000.

We also note the existence of a further reason for Packard Bell’s interest in Ets-Hokin’s financial condition, even though belated in developing, in that he was considered by Packard Bell to be the principal of the two corporations notwithstanding another stockholder in each and the receipt of an inheritance from his father would have enabled him, if he had so desired, to put additional capital into corporation businesses. A few months before the termination a Packard Bell official met with Ets-Hokin and wanted a commitment or promise that Ets-Hokin would invest an additional $75,000 in the businesses.

Ets-Hokin moved from Arizona to Chicago in late 1969 and had nothing to do with the day-by-day operations of the distributorships thereafter. The record is barren of support that Packard Bell was relying on Ets-Hokin’s personal financial responsibility in commencing and continuing to do business with the corporations.

Further, as we have noted, Packard Bell had been extending a large line of credit to the corporations for almost two years prior to the inquiry into Ets-Hokin’s personal finances and the reference to the Continuing Guaranty. Since there is no evidence that Packard Bell relied on the guaranty in extending this credit to the corporations, equitable estoppel cannot apply. See United States v. Aetna Cas. & Sur. Co., 480 F.2d 1095, 1099-1100 (8th Cir. 1973); Lebold v. Inland Steel Co., supra; General Motors Acceptance Corp. v. Gandy, 200 Cal. 284, 253 P. 137, 142 (1927).

The district court, in finding that equitable estoppel did apply, pointed out that Ets-Hokin failed to terminate the guaranty. The guaranty, by its language, however, clearly did not cover the indebtedness of the distributorship after it had been incorporated. In light of this, Packard Bell’s knowledge of the incorporation, and its failure even to mention the guaranty until almost two years after the incorporation, we do not consider Ets-Hokin’s failure formally to terminate the guaranty to be determinative.

The district court also placed reliance on the fact that no distributorship agreement was ever executed in the corporate names. Since the original distributorship agreement and the Continuing Guaranty were “interrelated” in that they were executed on the same date, the district court concluded that “the failure to enter into a new distributorship agreement executed by the corporation takes on added weight and significance in determining whether the guaranty remained operable.” We cannot agree. Packard Bell admittedly knew of the incorporation of the distributorship. We would be elevating form over substance to hold that the guaranty continued to operate until the parties “formalized” in the distributorship agreement a change which Packard Bell knew had occurred.

Our decision here is not contrary to this court’s opinion in Kingsberry Homes v. Corey, 457 F.2d 181 (7th Cir. 1972). In Kingsberry, the doctrine of equitable estoppel was applied where, in order to obtain an open account status, the members of a partnership executed a guaranty but shortly thereafter incorporated their business. This court noted in Kingsberry that the parties intended “to exchange an open account status in return for a pledge of individual responsibility”; that the incorporation occurred only eight months after the guaranty was executed; that the defendant failed to give formal notice of incorporation and used order forms which did not indicate incorporation; and that the corporate name was almost identical to the partnership name. 457 F.2d at 183. In contrast, in the present case, there was no concealment of the existence of the corporations, the incorporation occurred after eight years of continuous and close business dealings between the parties; and, as previously noted, there is no evidence that Packard Bell relied on the guaranty in extending credit to the corporations.

Ill

Packard Bell contends that the judgment entered below can be supported on the alternative theory (contained in Count I of its complaint) that payment was due on the two personal notes signed by Ets-Hokin in 1969.

As a preliminary matter we must consider Ets-Hokin’s first answer to this contention, i. e., that the issue of Count I, the payment of the notes is not before this court since Packard Bell did not cross appeal. Unfortunately for a full consideration of the validity of this argument, it was first presented in the appellant’s reply brief and then was only supported by citation to the rather unarguable proposition that filing of a notice of-appeal is jurisdictional. We, of course, do not have a brief on this issue from the appellee since the issue had not been raised when the answer brief of the appellee was filed.

In looking at the two Counts of the complaint we note each seeks the identical amount of recovery and obviously this was the net amount still owing at the cessation of the distributorships in Arizona with which Ets-Hokin was connected. Judge Magruder dealt with an analogous situation in Cochran v. M & M Transportation Co., 110 F.2d 519 (1st Cir. 1940). In that case, the plaintiff had “four strings” to his bow as contrasted to the two counts here. The court pointed out that having prevailed upon one count below the appellee could not have appealed the judgment based upon that part of the verdict since he had received the full relief to which he would have been entitled on any of the counts. However, the present case departs from Cochran in that final judgment was entered below in the present case as to both counts whereas it had not been in Cochran as to the three counts on which the appellee did not prevail. The situation confronting us may well fall within the ambit of Judge Magruder’s words:

“The situation is different where a judgment grants a litigant only part of the relief sought, and denies the rest. In such a case the party is aggrieved in part by the judgment and may appeal or cross-appeal. If he fails to do so he can be heard only in support of the judgment as rendered; such judgment becomes res judicata as to the issues decided against him. Alexander v. Cosden Co., 1934, 290 U.S. 484, 487, 54 S.Ct. 292, 78 L.Ed. 452; United States v. Hickey, 17 Wall. 9, 21 L.Ed. 559.” 110 F.2d at 523.

Packard Bell, possibly cognizant of the difficulties of its procedural position in challenging the court’s ruling on Count I, argues that they were entitled to recover on the notes and that this is a basis for affirming the judgment which was based on Count II apparently on the well established doctrine:

“The prevailing party may, of course, assert in a reviewing court any ground in support of his judgment, whether or not that ground was relied upon or even considered by the trial court. Compare Langnes v. Green, 282 U.S. 531, 538 [51 S.Ct. 243, 246, 75 L.Ed. 520], with Story Parchment Co. v. Paterson Parchment Paper Co., 282 U.S. 555, 567-568 [51 S.Ct. 248, 252, 75 L.Ed. 544]. As the Court said in United States v. American Ry. Express Co., 265 U.S. 425, 435-436 [44 S.Ct. 560, 564, 68 L.Ed. 1087]: ‘[I]t is likewise settled that the appellee may, without taking a cross-appeal, urge in support of a decree any matter appearing in the record, although his argument may involve an attack upon the reasoning of the lower court or an insistence upon matter overlooked or ignored by it.’ ” Dandridge v. Williams, 397 U.S. 471, 475 n. 6, 90 S.Ct. 1153, 1156-1157, 25 L.Ed.2d 491 (1970).

We are inclined to the view that the appellee is actually asking us to review an extensive record and to reverse in the absence of notice of appeal a judgment based upon Count I. We have set forth enough of this procedural issue to demonstrate that it is far from being free of complexity. In the absence of any sort of helpful analysis of the issue from the parties and in view of the fact that we find no merit in the claim of error as to Count I we will assume arguendo that the matter is before us.

The district court ruled against Packard Bell on Count I on the ground that neither it nor Ets-Hokin had designated to which particular debt payments were to be applied and that “[ajbsent such evidence, the law of Arizona and California called for application of each payment to the oldest obligation in point of time.” Under this rule, as Packard Bell concedes, the personal notes in question have been paid.

Packard Bell argues here, as it did in the district court, that the evidence indicated that the plaintiff had in fact chosen to apply payments in a manner which left the personal notes of Ets-Hokin unpaid. The district court’s finding of fact that no designation had been made by Packard Bell is not clearly erroneous and, therefore, the district court’s decision on Count I will not be disturbed. Rule 52, Fed.R.Civ.P.

IV

Finally, Packard Bell argues that if the personal notes were paid, they were paid from corporate funds and, therefore, Ets-Hokin is liable to Packard Bell, as a creditor of the corporations, for the corporations’ debts to the extent of his use of corporate funds. We find this argument unpersuasive. As the district court noted, “the evidence indicates that the corporations assumed the note account indebtedness and made payments towards those accounts which was credited to the corporations by Packard Bell.” Packard Bell itself regarded the notes as part of the debt of the distributorship and included them as such in its own accounting system.

In conclusion, we hold that equitable estoppel cannot be applied in this case and that, therefore, the incorporation of the distributorship bars recovery on the basis of the Continuing Guaranty. We are, moreover, unpersuaded by the other alternative theories of recovery suggested by Packard Bell. The judgment of the district court is therefore reversed and remanded for the entry of judgment for the defendant.

      . Packard Bell is a California corporation and Elliott Ets-Hokin is a citizen of Illinois.

      . During 1967, the defendant’s distributorship territory had been expanded to include the entire state of Arizona.

      . When the second corporation was formed, the “note account” was divided into two accounts.

      . Packard Bell does not challenge this reduction.

      . The guaranty was executed in California and the distributorship operated principally in Arizona. There is, however, no conflict of laws problem since the doctrine of equitable estoppel is well established in both California and Arizona. See United States Fidelity & Guaranty Co. v. Stewart’s Downtown Motors, supra; Safeco Ins. Co. v. Franklin, supra.

      . There was testimony that Packard Bell under threat of franchise termination overloaded the distributorships which may well have had a bearing on the negative financial picture which developed. Inasmuch as we are of the opinion that Packard Bell failed to prove an essential element to establish equitable estoppel we need not decide whether the coercive overloading occurred or what the legal effect would be if it did.

      . Packard Bell contends that evidence of its reliance on the guaranty can be found in certain correspondence sent to Ets-Hokin which referred to “your accounts.” We find this argument unpersuasive. The evidence indicated that Packard Bell also sent letters addressed to the corporations and to the managers of the corporations and that these letters similarly referred to “your accounts.” Moreover, most of the correspondence upon which Packard Bell relies was written after credit had already been extended to the corporations. That Packard Bell failed to use language with lawyer-like exactitude in its correspondence and memoranda, even in that which had legal significance, is reflected in the letter of notification of intent to repossess pursuant to the Security Agreement: “Pursuant to paragraph 14 of Packard Bell Electronics Corporation’s Distributor Franchise Agreement executed by Elliott Distributing Company, Inc. on February 17, 1964, . Of course, the corporation did not come into existence until four years later. It is clear, however, that the billing department was not equally casual in its designations and the original corporation was, and eventually both corporations were, recognized as the de facto and de jure distributor, not Ets-Hokin personally.

      . The Continuing Guaranty provided:
      “This Guaranty shall not apply to any indebtedness created after receipt by Packard Bell of written notice of its revocation as to future transactions.”
      Ets-Hokin testified at the trial that he told agents of Packard Bell in September 1970 that he, Ets-Hokin, was not responsible for the corporate debts. The district court discredited this testimony and we accept the district court’s finding in this respect and assume that Ets-Hokin did not disclaim the guaranty.

      . The corporations were not mere customers of Packard Bell but were the franchised distributors for the entire state of Arizona. The evidence indicated that Packard Bell, as the franchisor, closely scrutinized the affairs of the corporations.

      . D. N. & E. Walter & Co. v. Zuckerman, 214 Cal. 418, 6 P.2d 251 (1931), is also distinguishable from the case before us. In Zuckerman, a guarantor was held liable on a guaranty which related to the debts of a sole proprietorship where a later formed corporation was found to be the alter ego of the sole proprietor and the only notice of the incorporation given to the plaintiff was, apparently, a notation on certain checks. Here, there is no question of notice of incorporation and there is no claim that the corporations were the alter egos of Ets-Hokin.


source: Caselaw Access Project

author: PER CURIAM:

license: Public Domain

text:
    INTERNATIONAL WESTMINSTER BANK LIMITED and Coutts & Co., on behalf of themselves and all others similarly situated, Plaintiffs-Appellants, v. FEDERAL DEPOSIT INSURANCE CORPORATION et al., Defendants-Appellees.
    Nos. 74-1262, 74-1263.
    United States Court of Appeals, Ninth Circuit.
    Jan. 8, 1975.

      Richard Murray (argued), of McCutcheon, Doyle, Brown & Enersen, San Francisco, Cal., for plaintiffs-appellants.
    Charles A. Legge (argued), of Bronson, Bronson & McKinnon, San Francisco, Cal., Edward Bransilver (argued), of F.D.I.C., Washington, D. C., Stanley A. Doten (argued), of Morrison, Foerster, Holloway, Clinton & Clark, San Francisco, Cal., for defendants-appellees.
    Before CARTER, HUFSTEDLER and TRASK, Circuit Judges.
   OPINION

PER CURIAM:

Appellants in these two consolidated actions seek declaratory and injunctive relief concerning certain transactions undertaken by appellee Federal Deposit Insurance Corporation (FDIC) as receiver of the United States National Bank of San Diego (USNB) and by Crocker National Bank (Crocker), which are asserted to be void as preferences. Jurisdiction is based upon 28 U.S.C. § 1331 (federal question). The district court dismissed appellants’ complaint for failure to state a claim upon which relief could be granted and later dismissed the action and entered judgment in favor of appellees.

The plaintiffs as appellants are three London banks which on October 18, 1973, the date of the receivership, held seven commercial letters of credit issued by USNB in the aggregate sum of $25.7 million.' In addition to the named plaintiffs, the complaint alleges that they represent a class consisting of all other persons, corporations, associations and other entities (except members of the “Designated Group”) whose claims as creditors of USNB have not been and are not to be assumed by Crocker.

On October 18, 1973, the United States Comptroller of the Currency, as overseer of national banks, declared USNB insolvent, ordered it closed and appointed FDIC as its receiver in accordance with 12 U.S.C. § 1821(c). Having anticipated this event, FDIC determined, prior to its occurrence, to attempt to consummate a purchase and assumption transaction by which a successor bank would acquire assets and assume liabilities and continue the operation of the failing bank without interruption. Thus it quietly contacted several banks which might qualify and invited bids for the USNB and its some 63 branches. In the late afternoon of the day of closing, the bid of the Crocker National Bank was accepted. The proposal was submitted to the district judge to whom the liquidation of USNB was assigned and after an ex parte hearing the plan was approved. The main office and 62 branches (all except one in Nassau) opened the following morning as units of Crocker.

The purchase and assumption agreement under which the transition took place permitted Crocker to acquire the assets and assume the liabilities for a premium of $89.5 million. Excluded from the acquisition and assumption were all of those assets and liabilities associated with a “Designated Group” consisting of the longtime controlling shareholder of USNB and his associates together with a great many other persons, firms, corporations and entities listed in “Schedule A” attached to the agreement and otherwise described in the agreement. The assets were excluded because they were thought to be of doubtful and uncertain value and the liabilities were likewise subject to question. FDIC as receiver therefore conveyed to Crocker a selected group of assets and liabilities and $128,780,000 in cash representing the difference between the amount of obligations assumed and the value of the assets transferred less the premium paid by Crocker.

The purposes which appellant states that FDIC hoped would be achieved by the transaction, apart from the general welfare of the community, were: (1) to pay selected creditors of USNB 100 percent, including interest, of the amounts owed to them by USNB; (2) to leave other creditors such as those associated with the “Designated Group” with a claim against the receivership; and (3) to permit FDIC to recoup the $128,780,-000 of its money paid to Crocker by providing for a first lien against the receivership assets, thus discharging its obligation as deposit insurer with minimum or no cost to itself.

There is no contention made that the letters of credit issued to appellants fall within the “Designated Group” classification or that they are otherwise invalid.

Appellants argue that the FDICCrocker transaction prejudices their ability to recover on their letters of credit and makes them second-class creditors. Specifically, whereas all holders of obligations assumed by Crocker will be able to collect 100 percent of amounts due, appellants are relegated to the questionable assets remaining in the receivership. And even then their obligations are subordinated to the first lien created by FDIC. Legally, appellants contend, this disparate treatment violated 12 U.S.C. §§ 91 and 194.

The court granted an order dismissing the complaint for the reason that the complaint failed to state a claim upon which relief could be granted in that 12 U.S.C. § 91 did not apply to a receiver appointed pursuant to 12 U.S.C. § 191 or to a transaction entered into by a receiver pursuant to 12 U.S.C. §§ 192 and 1823(e) and for the additional reasons that the plaintiffs’ claims were not ripe for adjudication and they lacked standing to sue upon an allegation of a violation of 12 U.S.C. § 194.

Some 3 weeks later the court amended its order and found that no amendment to the complaint could be made at that time which would state a claim and therefore dismissed the action. It is from that final order that these appeals have been taken.

We believe that the court was correct in its order holding that the complaint failed to state a claim upon which relief could be granted. We disagree with the court’s further order to the effect that no amendment could be made at that time which would state a claim and for that reason the action should be dismissed.

The complaint is plainly deficient in its attempt to allege basic equity jurisdiction.

“The basis of injunctive relief in the federal courts has always been irreparable harm and inadequacy of legal remedies.” Beacon Theatres, Inc. v. Westover, 359 U.S. 500, 506 — 507, 79 S.Ct. 948, 954, 3 L.Ed.2d 988 (1959).

See also O’Shea v. Littleton, 414 U.S. 488, 94 S.Ct. 669, 38 L.Ed.2d 674 (1974); Caddy-Imler Creations, Inc. v. Caddy, 299 F.2d 79 (9th Cir. 1962).

Here there was no allegation of irreparable injury. The appellants were the holders of letters of credit which upon their face entitled them to receive payment of monies at a date and upon terms stated therein. There was no allegation that those payments were in default or that demand for payment had been made and refused. Neither was there any charge that Crocker and FDIC would not be responsible in the event they had acted in violation of law and that the appellants had been damaged. FDIC may sue and be sued in any court of law or equity, state or federal. 12 U.S.C. § 1819.

In addition, we simply are not persuaded that as a matter of basic equitable considerations, a showing has been made on the pleadings and briefs and in argument to justify the grant of an injunction to interdict the execution of the agreement of the parties. Already, as of the time between the ruling of the trial court and the argument on appeal, all the letters of credit of the named parties have been paid except two; one of those remaining matures September 8, 1975, and the other on December 22, 1975. The plaintiffs-appellants’ claim for relief is only for payment from the receivership of an undetermined sum of money due at an undetermined date. The record does not reveal any inadequacy of the appellants’ legal remedy in the event that they are wrongfully prevented by appellees from receiving that payment.

The complaint also sought declaratory relief based upon 12 U.S.C. §§ 9Í and 194. We do not reach the issues raised by the claims for declaratory relief until the appellants have established themselves as creditors of the receivership with unpaid claims. That they allege themselves to be holders of certain letters of credit issued by the defunct bank is not enough. Their claims may not have matured; they may not be valid as against the receiver. See Argonaut Savings & Loan Association v. FDIC, 392 F.2d 195 (9th Cir. 1968); Kennedy v. Boston-Continental National Bank, 84 F.2d 592, 597 (1st Cir. 1936). Other defenses may be asserted or they may have been paid. But appellants should have an opportunity to amend their complaint and assert their claim if, indeed, they have one.

The judgment is reversed and the case is remanded with directions to the district court to fix a time within which claims should be filed, if such a time has not been fixed, and a time within which the appellants may file an amended complaint should they wish to do so.

      . The monumental complexity of this transaction may be more readily understood by noting that USNB at the time of its closing had approximately $1.25 billion in book value of assets, and liabilities with deposits of $930 million and 62 branches in four Southern California counties and one in Nassau.

      . Upon the date of the agreement it was not known how much of the total of the appellants’ letters of credit of $25.7 million would be paid or otherwise liquidated by the date of oral argument. If all were discharged the litigation could be terminated. It appears, however, from supplemental papers which we permitted to be filed, that all three appellants still claim that the total amounts due, principal and interest, on all their several letters of credit have not been completely liquidated. However, the amount unliquidated in this ongoing receivership has not been finally ascertained.

      . Section 91 as here pertinent reads:
      “All transfers ... [of debts] owing to any national banking association, . . .; all assignments ... [of obligations owed such an association]; all deposits of money, bullion, or other valuable thing for its use, or for the use of any of its shareholders or creditors; and all payments of money to either, made after the commission of an act of insolvency, or in contemplation thereof, made with a view to prevent the application of its assets in the manner prescribed in this chapter, or with a view to the preference of one creditor to another, shall be utterly null and void;
      Section 194 provides in pertinent part:
      “From time to time . . the comptroller shall make a ratable dividend oí the money so paid over to him by such receiver [of an insolvent national bank] on all such claims as may have been proved to his satisfaction or adjudicated in a court of competent jurisdiction, and, as the proceeds of the assets of such association are paid over to him, shall make further dividends on all claims previously proved or adjudicated; . . . .”

      . An action based upon the transactions described herein was first filed in the United States District Court for the Northern District of California; within a few days an identical action was filed in the Southern District of California. After a hearing on the question of venue a transfer was made so that both cases proceeded in the Southern District. The orders of the district court herein described were first entered in the case filed in the Southern District; immediately following, a similar disposition was made in the Northern District case which had been transferred. Appeals were taken in both and consolidated here.

      . Where the claim against FDIC is based upon tort, suit might have to be under the Federal Tort Claims Act against the United States. Magellsen v. FDIC, 341 F.Supp. 1031 (D.Mont. 1972). In either event there is a remedy at law from a financially responsible defendant.


text:
    UNITED STATES of America, Appellee, v. William LEE, Defendant-Appellant.
    No. 458, Docket 74-1925.
    United States Court of Appeals, Second Circuit.
    Argued Dec. 9, 1974.
    Decided Jan. 9, 1975.
    Stay Denied April 21, 1975.
    See 95 S.Ct. 1653.

      John J. Hayden, Goshen, N. Y. (Barry B. Silver, Fischler & Silver, Newburgh, N. Y., on the brief), for defendant-appellant.
    Jerome L. Merin, Sp. Atty., U. S. Dept, of Justice (Paul J. Curran, U. S. Atty., for the Southern District of New York, Lawrence S. Feld, Asst. U. S. Atty., Edward M. Shaw, Sp. Atty., U. S. Dept, of Justice, on the brief), for appellee.
    Before FEINBERG and MULLIGAN, Circuit Judges, and BRYAN, District Judge.

       Of the United States District Court for the Southern District of New York, sitting by designation.

   PER CURIAM:

William Lee, a former police sergeant in Newburgh, New York, appeals from a conviction on two counts of giving false testimony before a federal grand jury, 18 U.S.C. § 1623, in the United States District Court for the Southern District of New York, after a jury trial before Charles L. Brieant, Jr., J. Lee was sentenced to six months in prison on one count and to one day on the other, to be served consecutively. The testimony was given before a grand jury investigating, among other things, payoffs made by gamblers to local police officers in violation of 18 U.S.C. § 1511. Lee denied that he had picked up money from a “hustler and gambler” named Pee Wee Boone, or that he had ever received money from a gambling business operator named Allen Handler, or money or property from any other persons, who were neither his employers nor relatives.

Lee offers many reasons why his conviction should be overturned, but none has any merit. Relying on United States v. Freedman, 445 F.2d 1220, 1226-1227 (2d Cir. 1971), and United States v. Provinzano, 333 F.Supp. 255 (E.D.Wis. 1971), appellant argues that the false statements were not “material”' to the grand jury because it already knew the truth about the Handler and Boone contacts before Lee testified. Our later decision in United States v. Carson, 464 F.2d 424, 436, (2d Cir.), cert. denied, 409 U.S. 949, 93 S.Ct. 268, 34 L.Ed.2d 219 (1972), may be read to reject this argument. Cf. United States v. Mancuso, 485 F.2d 275, 281 n. 17 (2d Cir. 1973). In any event, the grand jury did not know the truth about possible other payments or gifts to Lee, and his blanket denial frustrated its inquiry and was therefore material even under the cases Lee cites.

Appellant’s objections to the charge on materiality and on circumstantial evidence were not raised in the trial court and are, in any event, insubstantial. See United States v. Mancuso, supra, 485 F.2d at 280; United States v. Pfingst, 477 F.2d 177, 197 (2d Cir.), cert. denied, 412 U.S. 941, 93 S.Ct. 2779, 37 L.Ed.2d 400 (1973). Appellant also claims that 18 U.S.C. § 1623 applies only to cases in which the Government proves falsity by showing that defendant made “irreconcilably contradictory” declarations under oath. It is obvious that section 1623(c), from which the quoted language is taken, states one, but not the exclusive, method for proving falsity. Appellant also objects to the “modified Allen charge.” Even though the judge was advised, contrary to his desire, of the breakdown of the jury vote, taken as a whole his charge was not erroneous— much less plainly so — see United States v. Tyers, 487 F.2d 828, 832 (2d Cir. 1973), cert. denied, 416 U.S. 971, 94 S.Ct. 1995, 40 L.Ed.2d 560 (1974); United States v. Jennings, 471 F.2d 1310, 1313-1314 (2d Cir.), cert. denied, 411 U.S. 935, 93 S.Ct. 1909, 36 L.Ed.2d 395 (1973). In addition, we adhere to our ruling less than two years ago that 18 U.S.C. § 1623 is constitutional. United States v. Ruggiero, 472 F.2d 599, 606 (2d Cir.), cert. denied, 412 U.S. 939, 93 S.Ct. 2772, 37 L.Ed.2d 398 (1973); see also United States v. Koonce, 485 F.2d 374, 376-378 (8th Cir. 1973). Appellant’s claim that use of the word “material” renders section 1623 unenforceably vague is merit-less. See United States v. Ceccerelli, 350 F.Supp. 475, 477 (W.D.Pa.1972). Appellant’s remaining arguments do not merit discussion.

Judgment affirmed.

      . Appellant was acquitted on two other counts.

      . There was no objection in the trial court to the specific aspects of the Allen charge raised before us.

      . However, we repeat the suggestion, see United States v. Dickerson, 508 F.2d 1216, 1219 n. 8, (2d Cir. 1974) that it would be better not to tell the jury that a defendant surely would prefer a verdict “one way or the other,” since a defendant may prefer a hung jury to a guilty verdict.


author: BRIGHT, Circuit Judge.

text:
    NATIONAL LABOR RELATIONS BOARD, Petitioner, v. WABASH TRANSFORMER CORPORATION, Respondent.
    No. 74-1446.
    United States Court of Appeals, Eighth Circuit.
    Submitted Dec. 11, 1974.
    Decided Feb. 3, 1975.
    Stephen Quinn, Atty., N.L.R.B., Washington, D. C., for petitioner.
    George W. Moehlenhof, McDermott, Will & Emery, Chicago, Ill., for respondent.
    Before LAY and BRIGHT, Circuit Judges; and TALBOT SMITH, Senior District Judge.

       TALBOT SMITH, Senior District Judge, Eastern District of Michigan, sitting by designation.

   BRIGHT, Circuit Judge.

The National Labor Relations Board (Board) petitions for enforcement of its order issued against Wabash Transformer Corporation (Employer) of Farming-ton, Missouri, directing the Employer to bargain with the Communications Workers of America (Union) pursuant to 29 U.S.C. § 158(a)(5). The Employer, refusing to bargain, claims that the representation election was conducted in an unfair manner and that the subsequent certification of the Union by the Board was therefore invalid. We grant the order of enforcement.

Pursuant to a petition filed by the Union, a representation election was held for all production and maintenance workers at the Employer’s Farmington, Missouri, plant on March 16, 1973. The Union won the election on a 50 — 43 vote and, after timely objections were filed by the Employer, a three-member panel of the Board validated the election and certified the Union as the exclusive bargaining agent for the workers at the Farmington plant. The Employer’s refusal to bargain generated this unfair labor practice proceeding. The Board, on April 30, 1974, ruled that the Employer had violated §§ 8(a)(5) and (1) of the Act (29 U.S.C. §§ 158(a)(5) and (1)), and ordered it to bargain with the Union. The instant appeal followed.

The Employer objects to the conduct of the representation election on two grounds. First, it claims that the Board’s agent conducting the election breached the Board’s obligation of neutrality by announcing the opening of the polls over the Employer’s loudspeaker system in the following manner:

The Polls are open and you may now go vote and elect a union representative.

Second, the Employer contends that the promise of the Union to waive the payment of initiation fees and dues until after the election and until the Union had negotiated a collective bargaining agreement with the Employer violated the recent Supreme Court decision of NLRB v. Savair Mfg. Co., 414 U.S. 270, 94 S.Ct. 495, 38 L.Ed.2d 495 (1973).

I.

In upholding the election, the Board acknowledged that its agent, in announcing the election over the loudspeaker, should have explicitly stated that an employee could vote against as well as for a Union representative. However, the Board majority declined to adopt the view that the agent’s statement was per se violative of the Board’s standards of neutrality. The Board concluded that the circumstances surrounding the statement established that the integrity of the election process was not so impaired as to warrant the ordering of a new election. We agree.

The announcement was made at approximately 6:30 A. M., immediately pri- or to the early morning opening of the polls, to accommodate three workers who were completing their night shift. About 20 other employees were in the plant waiting for the morning shift to begin and may have heard the announcement. The same announcement, however, was not repeated when the polls reopened at 2:30 P. M. to receive votes from the workers on the morning and afternoon shifts. More importantly, the Director of Manufacturing for the Employer, who was present in the plant when the statement was made at 6:30 A. M., voiced no objection to the announcement. No evidence indicates that any employee was misled by the announcement and no claim is made that the Board’s agents conducting the election favored the Union over the Employer.

The Supreme Court has observed, “Congress granted the Board a wide discretion to ensure the fair and free choice of bargaining representatives.” NLRB v. Wyman-Gordon Co., 394 U.S. 759, 767, 89 S.Ct. 1426, 1430, 22 L.Ed.2d 709 (1969). See NLRB v. A. J. Tower Co., 329 U.S. 324, 330, 67 S.Ct. 324, 91 L.Ed. 322 (1946); NLRB v. Waterman S.S. Co., 309 U.S. 206, 226, 60 S.Ct. 493, 84 L.Ed. 704 (1940). Under the circumstances here, the ruling that the questioned statement did not breach the neutrality of the election procedures fell within the Board’s discretionary powers.

II.

The Employer also contends that the Union’s waiver of dues and initiation fees until after negotiation of a bargaining agreement enabled the Union, in effect, to “buy” members before the election and portray a false picture of its employee support in violation of the rule laid down in NLRB v. Savair Mfg. Co., 414 U.S. 270, 94 S.Ct. 495, 38 L.Ed.2d 495 (1973). In Savair, the Court found that a union’s offer to waive initiation fees for those workers signing union authorization cards before the certification election constituted an unfair labor practice. The Court reasoned:

Whatever his true intentions, an employee who signs a recognition.slip pri- or to an election is indicating to other workers that he supports the Union. His outward manifestation of support must often serve as a useful campaign tool in the Union’s hands to convince other employees to vote for the Union, if only because many employees respect their coworkers’ views on the unionization issue. By permitting the Union to offer to waive an initiation fee for those employees signing a recognition slip prior to the election, the Board allows the Union to buy endorsements and paint a false portrait of employee support during its election campaign. [Id. at 277, 94 S.Ct. at 499.]

The Board reads Savair as precluding waivers of fees only when they are offered to employees as an inducement for pre-election support. The Board contends that the coercive effects of the practice condemned in Savair are absent in the instant case. We agree. The temporary waiver of dues for all employees does not have the effect of encouraging employees to make a false show of support for the Union in order to gain relief from certain fees. Indeed, a union’s promise of temporary waiver of dues for all potential union members may serve to counteract an oft-used management argument that unions require workers to pay dues without guaranteeing the receipt of any tangible benefits. Here, the Union assured the workers, whether Union supporters or not, that the Union demanded no dues until it successfully obtained a contract from the Employer. Such campaign tactics are not proscribed by Savair. The majority opinion in Savair notes the following:

The Board argues that unions have a valid interest in waiving the initiation fee when the union has not yet been chosen as a bargaining representative, because ‘[e]mployees otherwise sympathetic to the union might well have been reluctant to pay out money before the union had done anything for them. Waiver of the [initiation fees] would remove this artificial obstacle to their endorsement of the union.’ ” * * * While this union interest is legitimate, the Board’s argument ignores the fact that this interest can be preserved as well by waiver of initiation fees available not only to those who have signed up with the union before an election but also to those who join after the election. The limitation imposed by the Union in this case — to those joining before the election — is necessary only because it serves the additional purpose of affecting the .Union organizational campaign and the election. [414 U.S. at 274 n. 4, 94 S.Ct. at 497.]

See NLRB v. Stone & Thomas, 502 F.2d 957 (4th Cir. 1974).

Accordingly, we direct that the Board’s order be enforced.

      . This decision is reported as Wabash Transformer Corporation, 205 NLRB 38 (1973) (Chairman Miller dissenting).

      . This decision is reported at 210 NLRB 68 (1974) (Chairman Miller dissenting).

      . The parties are in some disagreement over the exact phrasing of the agent’s statement. We accept the above-quoted version as otfered by the Employer.

      . The Employer operates three shifts — 11:00 P. M. to 7:00 A. M., 7:00 A. M. to 3:30 P. M., and 3:30 to 11:00 P. M. The polling sessions were from 6:30 to 7:00 A. M. and from 2:30 to 5:00 P. M.

      . The Union distributed a leaflet on March 12, 1973, reading in relevant part:
      Dues $5.50! Yes, your dues will be $5.50— AFTER WE HAVE SUCCESSFULLY BARGAINED A CONTRACT WITH THE WABASH TRANSFORMER CORPORATION— NOT A CENT BEFORE WE REACH AN AGREEMENT! This is a reasonable premium to insure better wages, fringe benefits and working conditions, plus a strong voice to review your grievances with the Company.

      . A leaflet, dated February 16, 1973, prepared by the Company for distribution to employees, reads in part:

        Now lets discuss union dues: On this subject the union organizer does give you some facts. He says you are going to have to pay $6.50 per month for men; $6.00 per month for women. That’s more than $10,-000 a year he’s going-to extract from your collective pockets. No wonder he’s interested in organizing this plant.
      In addition, the envelopes with the workers’ paychecks on March 9, 1973, contained the following message:
      IF YOU BELONGED TO THE CWA TODAY THIS PAY CHECK WOULD BE SHORT $5.50 FOR THIS MONTH’S UNION DUES____THINK ABOUT IT!!!


author: PER CURIAM.

text:
    Merl BLAY et al., Petitioners-Appellants, v. Hon. Donald (Sic) J. YOUNG, Judge U. S. District Court for the Northern District of Ohio, Western Division, Respondent-Appellee.
    No. 74-1919.
    United States Court of Appeals, Sixth Circuit.
    Nov. 19, 1974.
    William J. Brown, Atty. Gen. of Ohio, Columbus, Ohio, for petitioners-appellants.
    Harry F. Sargeant, Pros. Atty., Fremont, Ohio, Joseph Goldberg, Sol., City of Toledo, Toledo, Ohio, Frederick M. Coleman, U. S. Atty., Cleveland, Ohio, for respondent-appellee.
    Before McCREE, MILLER, and LIVELY, Circuit Judges.
   PER CURIAM.

We consider a petition for mandamus to compel a single district judge to submit to a three-judge court, of which he is a member, duly constituted under 28 U.S.C. §§ 2281, 2284, a motion to dismiss and a motion to intervene. These motions were considered by a single district court member of the three-judge court at the direction of the court under 28 U.S.C. § 2284(5). This section provides:

Any one of the three judges of the court may perform all functions, conduct all proceedings except the trial, and enter all orders required or permitted by the rules of civil procedure. A single judge shall not appoint a master or order a reference, or hear and determine any application for an interlocutory injunction or motion to vacate the same, or dismiss the action, or enter a summary or final judgment. The action of a single judge shall be reviewable by the full court at any time before final hearing.

The single district judge in whose court the case was originally docketed, denied the motion to dismiss and granted the motion to intervene.

We are asked to review the jurisdiction of the single district judge to enter these orders. They are concededly interlocutory, and, as such, are not reviewable on appeal to this court because they are not within the express authorization of 28 U.S.C. § 1292. The petition for mandamus seeks to avoid the statutory prohibition of appellate review of interlocutory orders.

The threshold question is our jurisdiction to hear the petition for mandamus which has been filed under the “All Writs Act,” 28 U.S.C. § 1651. Section 1651 provides:

The Supreme Court and all courts established by Act of Congress may issue all writs necessary or appropriate in aid of their respective jurisdictions and agreeable to the usages and principles of law. (Emphasis added.)

Under this statute, a United States Court of Appeals may issue writs of mandamus in aid of its existing jurisdiction or in aid of its future appellate jurisdiction. Under 28 U.S.C. § 1253, however, appeal from orders of three-judge courts granting or denying interlocutory or permanent injunctions is directly to the United States Supreme Court which has exclusive appellate jurisdiction in such cases. It is clear, therefore, that this court does not have nor can it acquire jurisdiction of this case except in narrowly restricted instances not applicable here. See, e.g. Hicks v. Pleasure House, Inc., 404 U.S. 1, 92 S.Ct. 5, 30 L.Ed.2d 1 (1971). It follows that the All Writs Act which permits writs in aid of our jurisdiction gives us no authority to grant the writ. Cf., e. g., Tidewater Oil Co. v. United States, 409 U.S. 151, 160, 93 S.Ct. 408, 34 L.Ed.2d 375 (1972), United States Alkali Export Ass’n Inc. v. United States, 325 U.S. 196, 65 S.Ct. 1120, 89 L.Ed. 1554 (1945).

For the foregoing reasons, the petition is dimissed, and we do not determine whether delegation by the three-judge court to one of its members of the motion to dismiss and the motion to intervene was proper.

      . On page three of petitioners’ Application for a Writ of Mandamus there appears the statement:
      On June 28, 1974, petitioners filed a motion for reconsideration of respondent’s order and a petition for referral of the jurisdictional questions of the case to the entire panel for resolution. In this pleading, petitioners did not ask for reconsideration of the merits of respondent’s order, but solely questioned his authority under 28 U.S.C.A. § 2284(5) to rule on the question presented. This motion and the petition for referral were denied in an order and opinion entered by respondent on July 25, 1974.
      It does not therefore appear that the full three-judge court has been asked to review the determination of the single judge. If the three-judge court had done so, it is clear that we would have no appellate jurisdiction to review the order entered. Failure to request such review on the merits would seem to afford a reason to deny review here if appellate jurisdiction otherwise existed.


author: COFFIN, Chief Judge.

text:
    GAY STUDENTS ORGANIZATION OF the UNIVERSITY OF NEW HAMPSHIRE et al., Plaintiffs-Appellees, v. Thomas N. BONNER, Individually and as President of the University of New Hampshire, et al., Defendants-Appellants. GAY STUDENTS ORGANIZATION OF the UNIVERSITY OF NEW HAMPSHIRE et al., Plaintiffs-Appellees, v. Meldrim THOMSON, Jr., Defendant-Appellant.
    Nos. 74-1075, 74-1076.
    United States Court of Appeals, First Circuit.
    Dec. 30, 1974.

      Charles G. Douglas, III, Concord, N. H., with whom Michael M. Black, Concord, N. H., was on brief, for Meldrim Thomson, Jr., appellant.
    Joseph A. Millimet, Manchester, N. H., with whom Silas Little, III and Devine, Millimet, Stahl & Branch, Manchester, N. H., were on brief, for Thomas Bonner and others, appellants.
    Richard S. Kohn, N.H.Civ.Lib.Union, Concord, N. H., for appellees.
    E. Carrington Boggan, New York City, on brief, for Lambda Legal Defense and Education Fund, Inc., amicus curiae.

      Before COFFIN, Chief Judge, McENTEE and CAMPBELL, Circuit Judges.
   COFFIN, Chief Judge.

The Gay Students Organization (GSO) was officially recognized as a student organization at the University of New Hampshire in May, 1973, and on November 9, 1973 the group sponsored a dance on campus. The dance itself was held without incident, but media coverage of the event and criticism by Governor Meldrim Thomson, Jr., led the University’s Board of Trustees to reconsider its treatment of the organization. The next day, November 10, 1973, the Board issued a “Position Statement” which indicated that the University would attempt to have determined the “legality and appropriateness of scheduling social functions by the Gay Students Organization” and which “directed that in the interim the University administration would schedule no further social functions by the Gay Students Organization until the matter is legally resolved.” The University subsequently filed a declaratory judgment action in Strafford County Superior Court on November 21, 1973.

When the GSO requested permission to sponsor a play on December 7 and have a social function afterward, the University permitted the play but denied permission for the social function. The play was given as scheduled, and the GSO held a meeting following it. Sometime during the evening copies of two “extremist” homosexual publications were distributed by individuals over whom the GSO claims it had no control. Governor Thomson wrote an open letter to the trustees after the play, warning that if they did not “take firm, fair and positive action to rid your campuses of socially abhorrent activities” he would “stand solidly against the expenditure of one more cent of taxpayers’ money for your institutions.” Dr. Thomas N. Bonner, President of the University, then issued a public statement condemning the distribution of the homosexual literature and announcing that a repetition of the behavior would cause him to seek suspension of the GSO as a student organization. Bonner also revealed that he had “ordered that the current Trustee ban on GSO social functions be interpreted more strictly by administrative authorities than had been the case before December 7, 1973.”

The lawsuit which is the subject of this appeal was filed in federal district court by the GSO on November 29, 1973. The complaint alleged First and Fourteenth Amendment violations giving rise to a cause of action under 42 U.S.C. § 1983, and sought injunctive and declaratory relief. A hearing was held on December 10 on the GSO’s request for a preliminary injunction, and the parties agreed that the hearing would serve as a final hearing on the merits. Defendants, hereinafter “appellants”, requested that the proceeding be reopened for the submission of additional evidence, and a second hearing was held on December 28. On January 16, 1974, the district court held for the GSO (sometimes hereinafter referred to as “appellees”) on the ground that its members had been denied their First Amendment right of association. 367 F.Supp. 1088, 1095 (D.N.H.1974). The court found no direct impairment of the GSO’s “more traditional First Amendment rights”, presumably the freedoms of speech, assembly and petition from which the right of association is derived. See Healy v. James, 408 U.S. 169, 181, 92 S.Ct. 2338, 33 L.Ed.2d 266 (1972). The court also indicated that in its view substantial equal protection questions were raised by defendants’ policy, and that, First Amendment considerations aside, the state could not demonstrate that the classification rationally furthered a legitimate state interest. 367 F.Supp. at 1098. The court enjoined appellants “from prohibiting or restricting the sponsorship of social functions or use of University facilities for such functions by the Gay Students Organization” and “from treating the Gay Students Organization differently than other University student organizations.”

Before considering the merits of the appeal, we must deal with several procedural issues raised by appellants. Governor Thomson claims, first of all, that the district court was without jurisdiction to hear the case under 42 U.S.C. § 1983 and 28 U.S.C. § 1343 because appellants are not “persons” within the ambit of § 1983. In Monroe v. Pape, 365 U.S. 167, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961), the Supreme Court held in an action for damages that a municipal corporation is not a “person” within the meaning of the statute, and City of Kenosha v. Bruno, 412 U.S. 507, 93 S.Ct. 2222, 37 L.Ed.2d 109 (1973), authoritatively rejected the argument that a different result is called for in cases involving requests for injunctive relief. In light of these cases, we would be inclined to hold, were the question before us, that the University of New Hampshire, “a body politic and corporate” established by state statute and supported by state funds, is not subject to suit under § 1983. See, e. g., Blanton v. State University of New York, 489 F.2d 377, 382 (2d Cir. 1973); Adamian v. University of Nevada, 359 F.Supp. 825 (D.Nev.1973); Note, the Supreme Court, 1972 Term, 87 Harv.L.Rev. 1, 258 (1973). But here the action was brought, not against the University or its Board of Trustees as a body, but against a number of the University’s officials. The defendants are Bonner, President and an ex officio member of the Board of Trustees; Stevens, Vice Provost for Student Affairs; O’Neil, Director, Recreation and Student Activities'; Governor Thomson, an ex officio member of the Board; and the other members of the Board, including Dunlap, the Chairman. These persons were originally sued both individually and in their official capacities, but the action against them as individuals was later dismissed, with the approval of the GSO. They remain defendants only as officials of the University, but we do not read Bruno to hold that officials, as opposed to state instrumentalities, are not § 1983 “persons”, at least so far as injunctive or declaratory relief is concerned. Ybarra v. City of Town of Los Altos Hills, 503 F.2d 250 (9th Cir. 1974); Rochester v. White, 503 F.2d 263 (3d Cir. 1974), rev’g, Rochester v. Baganz, 365 F.Supp. 179 (D.Del.1973); The Supreme Court, 1972 Term, supra, at 258-60. We cannot accept the conclusion that § 1983, directed specifically and exclusively at misconduct carried out under the color of state law, is not available to challenge the actions of persons who are acting in their capacities as state officials.

The other preliminary issues which must be dealt with arise out of appellees’ failure to timely serve several appellants. Bonner, Stevens and O’Neil were properly served, and attorney Joseph Millimet was authorized to and did accept service on behalf of Dunlap, Chairman of the Board of Trustees. The other members of the Board, however, were not served in advance of the hearings before the district court. Some were served on January 15, 1974, others on January 19, and Trustee Spanos was not served at all. The trustees who were not served before the hearings (hereinafter referred to as “the trustees”) contend that the district court’s opinion, filed on January 16, is not binding on them. The district court held a hearing on this matter on January 29, and on January 31 filed a Memorandum Opinion on Motions to Dismiss. The court, with the agreement of the GSO, dismissed the action as to the trustees in their individual capacities, but denied the motions to dismiss as they related to the trustees in their official capacities.

Deferring for the moment the status of Governor Thomson, we note first that there is no challenge to the district court’s finding that the trustees had actual knowledge of the pendency of the lawsuit. See Adams v. School Board, 53 F.R.D. 267 (M.D.Pa.1971). Indeed, they also knew that the court contemplated a speedy decision. As to the court’s finding of waiver of defects in service, the sequence of relevant events is as follows. The Board, through its Executive Committee, had earlier authorized the bringing of the state court proceeding against the GSO in order to obtain a resolution of what was seen as a troublesome legal issue. On December 17, a motion to reopen the proceedings in this case to take further evidence was filed on behalf of “the University of New Hampshire [sic] and the other defendants”; the motion also demanded from appellees a copy of the literature distributed at the December 7 performance of the play and the appearance of GSO’s president at the hearing. This was granted on December 20, and the reopened hearing was held on December 28, in which three University officials and a GSO member testified. Among those testifying was Allen Bridle, one of the trustees now challenging service and apparently the only trustee with personal knowledge relevant to the subject matter of the hearing.

At the January 29 hearing in the district court, Millimet stated that in the state court action he was representing the University and “the trustees in so far as they are the University”. And it was Millimet’s own understanding, which he admitted he “probably” communicated to counsel for appellees, that he was authorized to act for the trustees in the federal court action raising many of the same issues pending before the state court. See Bethlehem Steel Corp. v. Devers, 389 F.2d 44 (4th Cir. 1968). No objection to the court’s jurisdiction over the trustees was made until after the decision on the merits was rendered, and Millimet’s account of the January 19 trustees’ meeting shows a clear relationship between the unfavorable decision of January 16 and the decision to make a last minute issue of failure of timely service: “I think if I can recite my understanding of what occurred at the meeting of January 19th was that certain individual members of the Board of Trustees, who disagreed with the decision of the Court, felt that they did not want to be treated individually as defendants in this matter, and, therefore, asked that I press the present motion.”

In short, the critical facts bearing on jurisdiction over the defendants other than the governor are these: timely service was made on some, not all; all, however, had authorized their common attorney to prosecute concurrent litigation on the same matter in the state court and had knowledge of the suit being brought against them; acting on a motion brought on behalf of all, the court reopened the case and received testimony proffered in their name; only when an adverse decision had been rendered did defendants protest, their concern being expressed over the. prospect of individual liability; upon being apprised of this concern the court relieved defendants in this regard by dismissing the action against them in their individual capacities. Had this action not been taken, we might well look upon the absence of timely service on some defendants as fatal. The prospect of individual liability would have been a factor militating against a finding of waiver based on what could only be viewed as a group position. But the entire sequence reveals a group involved in both pursuing affirmatively and aggressively defending an institutional position, entrusting action in both areas to their institutional attorney. With liability confined to declaratory and injunctive relief, operative only on defendants in their official capacities, and on their successors, the district court having supportably found no possibility of prejudice, we see no basis to overrule the finding of waiver of defect of service.

The basic fact which accounts for much of the confusion is that, whatever the technical legal doctrines relating to § 1983 may be, the trustees, insofar as their official roles were concerned, regarded themselves as indistinguishable from the University and its Board of Trustees. To the extent that they were acting for the University, they were content to have Millimet represent them and to have the federal district court decide the legal controversy between the University and the GSO. The trustees, as trustees, must be considered to have waived, by this course of conduct, whatever right they had to personal service. See Alger v. Hayes, 452 F.2d 841 (8th Cir. 1972); United States v. Gajewski, 419 F.2d 1088 (8th Cir. 1969). They were aware of the litigation and saw no need to present to the court legal theories or evidence beyond those offered by Millimet, and they must be held to that decision despite the outcome adverse to their interests. To hold otherwise would be to reward Monday morning gamesmanship where there has been no encroachment on the rights of parties.

We find that Governor Thomson’s position is somewhat different. Millimet, in conferring with counsel for the GSO on the question of whether he would accept service for the trustees, said that he could not accept service on behalf of the individuals other than Dunlap,. “and particularly in behalf of the governor, who I knew had some different views about the matter and who, so far as I knew, had not participated in the meeting where the Executive Committee voted to proceed with the petition in the State Court.” The governor’s undenied role in precipitating the confrontation between the GSO and the University supports the suggestion that he would have expressed views and made arguments different from those of the administrators and the other trustees had he appeared. Separate counsel appeared for the governor at the January 29 hearing, and the governor filed an answer to the complaint within the prescribed period once he was served. The injunction issued by the district court must be modified to exclude the governor from its reach. He remains bound, of course, to the extent that he is “in active concert or participation” with the other defendants with regard to matters covered by the injunction. Fed.R.Civ.P. 65(d). The other defendants — the three University administrators and all the other members of the Board of Trustees — do remain before the court, so there can be no substantial argument that the court is without the power 'to award effective relief.

Coming to the merits, we are conscious of the tension between deeply felt, conflicting values or moral judgments, and the traditional legal method of extracting and applying principles from decided cases. First, this case deals with a university attempting to regulate student activity — in the in loco parentis tradition which most judges, being over thirty, acknowledged without much question during their years of matriculation. Second, the campus group sought to be regulated stands for sexual values in direct conflict with the deeply imbued moral standards of much of the community whose taxes support the university.

The underlying question, usually not articulated, is whether, whatever may be Supreme Court precedent in the First Amendment area, group activity promoting values so far beyond the pale of the wider community’s values is also beyond the boundaries of the First Amendment, at least to the extent that university facilities may not be used by the group to flaunt its credo. If visceral reactions suggest an affirmative answer, the next task for judges is to devise a standard which, while damping down the First Amendment on a university campus, is generally applicable and free from the dangers of arbitrariness. At this point troubles arise. How are the deeply felt values of the community to be identified? On an issue such as permissive abortion, the wider community may well be divided among those believing in “the right to life”, those believing in “the right to control over one’s body”, and those who do not feel deeply either way. Assuming that “community-wide values” could be confidently identified, and that a university could limit the associational activity of groups challenging those values, such an approach would apply also to socialists, conscientious objectors, vivisectionists, those favoring more oil refineries. As to each group, there are sectors of the community to whom its values are anathema. Or, if values be limited to morals, the barrier would reach those attracted to pre-marital sex, atheism, the consumption of alcoholic beverages, esoteric heterosexual activity, violence on television, or dirty books. This is not to suggest that a university is powerless to proscribe either harmful activity or incitement of illegal activity, but it is to say that we are unable to devise a tolerable standard exempting this case at the threshold from general First Amendment precedents.

We address first one of the questions we have alluded to: is there something different about a university that makes it an enclave sheltered from the full play of the First Amendment? The Supreme Court’s recent decisions in Healy v. James, 408 U.S. 169, 92 S.Ct. 2338, 33 L.Ed.2d 266 (1972), and Papish v. Board of Curators, 410 U.S. 667, 93 S.Ct. 1197, 35 L.Ed.2d 618 (1973), indicate in no uncertain terms that the First Amendment applies with full vigor on the campuses of state universities. In Healy the Court rejected the notion that First Amendment protections apply with less force on campus than in the community at large, 408 U.S. at 180, 92 S.Ct. 2338, and the Papish Court made it clear that there is no “dual standard” to be applied in scrutinizing restrictions upon speech. 410 U.S. at 671, 93 S.Ct. 1197. See also Tinker v. Des Moines Indep. Community School Dist., 393 U.S. 503, 506, 89 S.Ct. 733, 21 L.Ed.2d 731 (1969); Shelton v. Tucker, 364 U.S. 479, 487, 81 S.Ct. 247, 5 L.Ed.2d 231 (1960); Thonen v. Jenkins, 491 F.2d 722 (4th Cir. 1973); C. A. Wright, The Constitution on the Campus, 22 Vand.L.Rev. 1027 (1969). Indeed, the Court has recognized that the “vigilant protection of constitutional freedoms is nowhere more vital than in the community of American schools.” Shelton v. Tucker, supra, 364 U.S. at 487, 81 S.Ct. at 251. Thus we proceed as if the state itself, or one of its instrumentalities other than a university, had promulgated the regulation at issue.

Given this standard by which a university regulation should be judged, we now must ask whether, even though GSO was recognized as a campus organization, its members’ right of association was abridged. Here again, Healy v. James is controlling. It is true that there the university had refused to recognize the campus organization altogether rather than denying it the use of campus facilities for certain activities. But the Court’s analysis in Healy focused not on the technical point of recognition or nonrecognition, but on the practicalities of human interaction. While the Court concluded that the SDS members’ right to further their personal beliefs had been impermissibly burdened by nonrecognition, this conclusion stemmed from a finding that the “primary impediment to free association flowing from nonrecognition is the denial of use of campus facilities for meetings and other appropriate purposes.” The ultimate issue at which inquiry must be directed is the effect which a regulation has on organizational and associational activity, not the isolated and for the most part irrelevant issue of recognition per se.

Despite the language of Healy cited above, appellants argue that “social events” are not among the class of protected associational activities. One aspect of this argument is the suggestion that the ban on social events is permissible because other GSO activities such as discussions are allowed. A very similar contention was rejected in Healy. The university had pointed out that nonrecognition affected only on-campus activities, and that therefore the individuals wishing to form an SDS group could meet and distribute literature off campus, and even meet on campus if they did so informally. The Court was thus invited to find that the individuals were free to associate even though their on-campus activities were restricted. It held, however, that the other associational opportunities available to the individuals did not ameliorate significantly the disabilities imposed by the university. Once again, its standard was expressed in the clearest of terms — “[T]he Constitution’s protection is not limited to direct interference with fundamental rights.” Healy v. James, 408 U.S. at 183, 92 S.Ct. at 2347; Williams v. Rhodes, 393 U.S. 23, 41, 89 S.Ct. 5, 21 L.Ed.2d 24 (1968) (Harlan, J., concurring in the result); United Mine Workers v. Illinois State Bar Ass’n, 389 U.S. 217, 222, 88 S.Ct. 353, 19 L.Ed.2d 426 (1967); Bates v. City of Little Rock, 361 U.S. 516, 523, 80 S.Ct. 412, 4 L.Ed.2d 480 (1960); NAACP v. Alabama ex rel. Patterson, 357 U.S. 449, 461, 78 S.Ct. 1163, 2 L.Ed.2d 1488 (1958). Although the Supreme Court refused in Healy to characterize as insubstantial the impediments to association resulting from denial of access to campus bulletin boards and the school newspaper, 408 U.S. at 181-182, 92 S.Ct. 2338, that case could conceivably be read to shelter only those group efforts at self-promotion which utilize such conventional approaches.

There are, however, many other ways in which an organization might wish to go about attracting members and promoting-its point of view. Healy has been interpreted to extend to the use of campus facilities for social events in the one case of which we are aware which has considered the issue. Wood v. Davison, 351 F.Supp. 543 (N.D.Ga.1972). See also New Left Educ. Project v. Board of Regents, 326 F.Supp. 158 (W.D. Tex.1970), vacated on other grounds, 404 U.S. 541, 92 S.Ct. 652, 30 L.Ed.2d 697 (1972) (solicitation by campus political group). We are also led to this conclusion by the realization that efforts by a state to restrict groups other than the GSO to gatherings that were in no sense “social events” would be rejected out of hand. Even a lecture or discussion, which appear to be the only types of meetings which the appellants would allow the GSO to hold, becomes a social event if beer is served beforehand or coffee afterward. Teas, coffees and dinners form the backbone of many a political candidate’s campaign, and yet these activities would seemingly be subject to prohibition. While a university may have some latitude in regulating organizations such as fraternities or sororities which can be purely social, its efforts to restrict the activities of a cause-oriented group like the GSO stand on a different footing. See Note, Freedom of Political Association on the Campus: The Right to Official Recognition, 46 N.Y.U.L.Rev. 1149, 1158-61 (1971). Considering the important role that social events can play in individuals’ efforts to associate to further their common beliefs, the prohibition of all social events must be taken to be a substantial abridgment of associational rights, even if assumed to be an indirect one.

What we have been considering is appellants’ contention that, so long as an association is allowed to meet, restrictions on some of its activities are permissible — i. e., that it is enough that the glass is half full. We now address appellants’ contention that when we examine the other half of the glass, the activities barred by the campus regulation, we must conclude that the First Amendment offers no protection because the activities barred are not speech related. Putting aside for a moment the question of whether GSO social events constitute “speech” in their own right, we note the district court’s conclusion, not disputed by appellants, that the GSO is a political action organization, 367 F.Supp. at 1094 n. 7. See Acanfora v. Board of Educ., 359 F.Supp. 843, 856 (D.Md.1973), aff’d, 491 F.2d 498, 500-501 (4th Cir.), cert. denied,---- U.S.--, 95 S.Ct. 64, 42 L.Ed.2d 63 (1974); n. 1, supra (GSO Statement of Purpose). The GSO’s efforts to organize the homosexual minority, “educate” the public as to its plight, and obtain for it better treatment from individuals and from the government thus represent but another example of the associational activity unequivocally singled out for protection in the very “core” of association cases decided by the Supreme Court. NAACP v. Button, 371 U.S. 415, 83 S.Ct. 328, 9 L.Ed.2d 405 (1963); NAACP v. Alabama ex rel. Patterson, 357 U.S. 449, 78 S.Ct. 1163, 2 L.Ed.2d 1488 (1958); Bates v. City of Little Rock, 361 U.S. 516, 80 S.Ct. 412, 4 L.Ed.2d 480 (1960); DeJonge v. Oregon, 299 U.S. 353, 57 S.Ct. 255, 81 L.Ed. 278 (1937). Moreover, the activity engaged in by the GSO would be protected even if it were not so intimately bound up with the political process, for “it is immaterial whether the beliefs sought to be advanced by association pertain to political, economic, religious or cultural matters.” NAACP v. Alabama ex rel. Patterson, 357 U.S. at 460, 78 S.Ct. at 1171; see United Mine Workers v. Illinois State Bar Ass’n, 389 U.S. 217, 223, 88 S.Ct. 353, 19 L.Ed.2d 426 (1967); Brotherhood of Railroad Trainmen v. Virginia ex rel. Virginia State Bar, 377 U.S. 1, 84 S.Ct. 1113, 12 L.Ed.2d 89 (1964).

While we accept the district court’s conclusion that the associational rights of GSO members- have been impermissibly regulated, we cannot agree that their “more traditional First Amendment rights”, 367 F.Supp. at 1095, have not been abridged as well. See Wood v. Davison, 351 F.Supp. 543 (N.D. Ga.1972). Certainly GSO social functions do not constitute “pure speech”, but conduct may have a communicative content sufficient to bring it within the ambit of the First Amendment. Tinker v. Des Moines Indep. Community School Dist., 393 U.S. 503, 89 S.Ct. 733, 21 L.Ed.2d 731 (1969); United States v. O’Brien, 391 U.S. 367, 376-377, 88 S.Ct. 1673, 20 L.Ed.2d 672 (1968). Communicative conduct is subject to regulation as to “time, place and manner” in the furtherance of a substantial governmental interest, so long as the restrictions imposed are only so broad as required in order to further the interest and are unrelated to the content and subject matter of the message communicated. Police Dept. v. Mosley, 408 U.S. 92, 92 S.Ct. 2286, 33 L.Ed.2d 212 (1972); United States v. O’Brien, 391 U.S. at 376-377, 88 S.Ct. 1673.

There can be no doubt that expression, assembly and petition constitute significant aspects of the GSO’s conduct in holding social events. The GSO was created, as its Statement of Purpose attests, to promote the free exchange of ideas among homosexuals and between homosexuals and heterosexuals, and to educate the public about bisexuality and homosexuality. GSO claims that social events in which discussion and exchange of ideas can take place in an informal atmosphere can play an important part in this communication. It would seem that these communicative opportunities are even more important for it than political teas, coffees, and dinners are for political candidates and parties, who have much wider access to the media, being more highly organized and socially accepted. And beyond the specific communications at such events is the basic “message” GSO seeks to convey — that homosexuals exist, that they feel repressed by existing laws and attitudes, that they wish to emerge from their isolation, and that public understanding of their attitudes and problems is desirable for society.

Perhaps these claims, .being self serving, fall short of establishing the speech-relatedness of GSO social events. But they receive the strongest corroboration from the interpretation placed on these events by the outside community, as related by appellants. Appellants have relied heavily on their obligation and right to prevent activities which the people of New Hampshire find shocking and offensive. In the brief for President Bonner and the University administrators we are told that the “activity of the GSO was variously labelled a spectacle, an abomination and similar terms of disapprobation” after the GSO dance on November 8, 1973; that the University has an obligation to prevent activity which affronts the citizens of the University and the town and which violates breach of the peace statutes; that the GSO dance constituted “grandstanding”; that recognition of the GSO inflamed a large segment of the people of the state; that the organization cannot be permitted to use its unpopularity without restriction to undermine the University within the state; and that “the ban on social functions reflects the distaste with which homosexual organizations are regarded in the State”.

We do not see how these statements can be interpreted to avoid the conclusion that the regulation imposed was based in large measure, if not exclusively, on the content of the GSO’s expression. It is well established that “above all else, the First Amendment means that government has no power to restrict expression because of its message, its ideas, its subject matter, or its content.” Police Dept. v. Mosley, 408 U.S. at 95, 92 S.Ct. at 2290. Not only do appellants’ statements indicate that the prohibition reflects a distaste both for the ideas held and communicated by GSO members and for the larger message conveyed by the very holding of such public events, but the fact that the GSO alone was made subject to the regulation indicates that the ban is content-related. See Kalven, The Concept of the Public Forum: Cox v. Louisiana, 1965 Sup.Ct.Rev. 1, 29-30. Nor do the events of November 8 leave room for the conclusion that the disapproval of the GSO event was due to the occurrence of violently disruptive or otherwise illegal activities. The adverse reaction must be viewed as precipitated by the GSO’s program and the fact that the organization was aggressively presenting it to the public.

With the expressive quality of the GSO activities established, the appellants’ policy regulating the activities must be measured against the detailed standard articulated in United States v. O’Brien. The Supreme Court there upheld a conviction based upon the burning of a draft card by one who claimed to be demonstrating against the war and against the draft. The Court recognized that such conduct could be regulated despite its “speech” element because (1) the regulation was within the constitutional power of the government; (2) it furthered an important or substantial governmental interest; (3) the governmental interest was unrelated to the suppression of free expression; and (4) the incidental restriction on alleged First Amendment freedoms was no greater than essential to the furtherance of that interest. 391 U.S. at 377, 88 S.Ct. 1673.

As is apparent from our discussion above of the extent to which appellants’ policy toward the GSO is content-related, the curtailing of expression which they find abhorrent or offensive cannot provide the important governmental interest upon which impairment of First Amendment freedoms must be predicated. Papish v. Board of Curators, 410 U.S. 667, 670, 93 S.Ct. 1197, 35 L.Ed.2d 618 (1973); Healy v. James, 408 U.S. at 187-188, 92 S.Ct. 2338. See also Spence v. Washington, 418 U.S. 405, 94 S.Ct. 2727, 41 L.Ed.2d 842 (1974); Cline v. Rockingham County Superior Court, 502 F.2d 789 (1st Cir. 1974). “Once a forum is opened up to assembly or speaking by some groups, government may not prohibit others from assembling or speaking on the basis of what they intend to say. Selective exclusions from a public forum may not be based on content alone, and may not be justified by reference to content alone.” Police Dept. v. Mosley, 408 U.S. at 96, 92 S.Ct. at 2290; Niemotko v. Maryland, 340 U.S. 268, 71 S.Ct. 325, 328, 95 L.Ed. 267, 280 (1951); Bonner-Lyons v. School Comm., 480 F.2d 442 (1st Cir. 1973); Joyner v. Whiting, 477 F.2d 456 (4th Cir. 1973); Wright,- The Constitution on the Campus, at 1050.

Another interest asserted by appellants is that in preventing illegal activity, which may include “deviate” sex acts, “lascivious carriage”, and breach of the peace. But there has been no allegation that any such illegal acts took place at the GSO social events held on November 8 and December 7, 1973. Indeed, we emphasize the finding of the district court that “There were no official complaints about the dance, and no evidence was adduced to show that improper or illegal activities had taken place” at the dance. 367 F.Supp. at 1091. The only activity of even questionable legality discussed in the record involved the distribution of printed materials alleged to be obscene, and the district court found that no University of New Hampshire students were responsible for the distribution. Mere “undifferentiated fear or apprehension” of illegal conduct, Tinker v. Des Moines Indep. Community School Dist., 393 U.S. at 508, 89 S.Ct. 733, is not enough to overcome First Amendment rights, and speculation that individuals might at some time engage in illegal activity is insufficient to justify regulation by the state.

The University is by no means bereft of power to regulate conduct on campus. Not only may it act to prevent criminal conduct by policies focused on real and established dangers, but it can proscribe advocacy of illegal activities falling short of conduct, or conduct in itself noncriminal, if such advocacy or conduct is directed at producing or is likely to incite imminent lawless action. Brandenburg v. Ohio, 395 U.S. 444, 447, 89 S.Ct. 1827, 23 L.Ed.2d 430 (1969); see Communist Party of Indiana v. Whit-comb, 414 U.S. 441, 94 S.Ct. 656, 38 L.Ed.2d 635 (1974).

Finally there is a residual power going beyond the prevention of criminal conduct and the kind of advocacy of such conduct we have described. In Healy v. James, 408 U.S. 169, 189, 92 S.Ct. 2338, 33 L.Ed.2d 266 (1971), the Supreme Court said that in a school environment, the power to prohibit lawless action is not limited to acts of a criminal nature: “Also prohibitable are actions which ‘materially and substantially disrupt the work and the discipline of the school’.” Id. at 189, 92 S.Ct. at 2350, quoting Tinker, 393 U.S. at 513, 89 S.Ct. 733. We would assume that a university, so minded, would not be powerless to regulate public petting (heterosexual or otherwise), drinking in university buildings, or many other noncriminal activities which those responsible for running the institution rightly or wrongly think necessary “to assure that the traditional academic atmosphere is safeguarded.” 408 U.S. at 194 n. 24, 92 S.Ct. at 2352. Thus, if a university chose to do so, it might well be able to regulate overt sexual behavior, short of criminal activity, which may offend the community’s sense of propriety, so long as it acts in a fair and equitable manner. The point in this case is that the district court has found no improper conduct, and it does not appear that the university ever concerned itself with defining or regulating such behavior. Defendants sought to cut back GSO’s social activities simply because sponsored by that group. The ban was not justified by any evidence of misconduct attributable to GSO, and it was altogether too sweeping.

One final issue must be addressed. Appellees have requested that we enjoin appellants from proceeding with the action they instituted in state court. It is suggested that in this way the federal court judgment disposing of this controversy may be protected or effectuated. 28 U.S.C. § 2283. We do not find such action to be necessary.

The judgment of the District Court is affirmed, except as modified with regard to Governor Thomson.

      . The organization filed the following Statement of Purpose:
      “1) The primary purpose of the UNH Gay Students Organization is to promote the recognition of gay people on campus and to form a viable organization through which bisexual and homosexual people'may express themselves.
      “2) Through this organization social functions will be organized in which both gay and straight people can learn about the others’ thoughts and feelings concerning sexuality and sexual roles.
      “3) In an effort to educate the public about bisexuality and homosexuality, this organization will attempt to affect social changes through public relation measures such as guest lecturers, free literature, films, newspaper articles and radio programs.
      “4) Not the least important reason for establishing a gay organization is to give bisexual ahd homosexual members of the college community a place to communicate with each other and form discussion groups so that a healthy gay consciousness can evolve among students.”

      . We have examined the authorities to the contrary cited by the governor, and find them unpersuasive. Rochester v. Baganz is the only case cited which stands squarely for the proposition asserted and, as indicated in the text, that holding was reversed on appeal. Veres v. County of Monroe, 364 F.Supp. 1327 (E.D.Mich.1973), and Frye v. Lukehard, 364 F.Supp. 1379 (W.D.Va.1973), both involved claims for payments which, if upheld, would have been satisfied from a public treasury, and thus raised different issues than those presented here. Harkless v. Sweeny Ind. School Dist., 300 F.Supp. 794, 807 (S.D.Texas 1969), is another cited case in which the court of appeals reversed and held against, not in favor of, the position taken by the governor. “We find no prohibition in Monroe v. Pape against the exercise of federal judicial power through § 1983 to redress constitutional wrongs through requiring appropriate official acts by officials sued in their representative capacities.” 427 F.2d 319, 323 (5th Cir. 1970), cert. denied, 400 U.S. 991, 91 S.Ct. 451, 27 L.Ed.2d 439 (1971).

      . We are content to proceed, as did the district court, on the assumption that the policy announced by appellants reaches only purely social events, such as dances and parties, and not events such as plays. See 367 F.Supp. at 1095-1096.

      . As we have indicated at the outset, we see no sanction in reason or law for saying that, absent a direct threat to safety or the enforcement of law, certain groups lack a right of association. Many of the groups whose associational rights have been recognized by the Supreme Court have stood for propositions which must have seemed as outrageous as the GSO’s positions today must seem to many. See, e. g., Healy v. James, 408 U.S. at 187, 92 S.Ct. 2338; United States v. Robel, 389 U.S. 258, 88 S.Ct. 419, 19 L.Ed.2d 508 (1967); DeJonge v. Oregon, 299 U.S. at 353, 57 S.Ct. 255.

      . Indeed, there is some support for the proposition that dancing, the activity which the appellants are most confident in asserting their right to regulate, is itself a form of expression protected by the First Amendment. See Salem Inn, Inc. v. Frank, 501 F.2d 18, 20 (2d Cir. 1974); cf. California v. LaRue, 409 U.S. 109, 118, 93 S.Ct. 390, 34 L.Ed.2d 342 (1972).

      . Since we find the First Amendment issues presented here to be dispositive, it is not necessary to consider fully the equal protection questions with which they are intertwined. The equal protection challenge to the university policy strikes us as substantial in its own right, however, and our First Amendment analysis draws heavily upon the conclusions which must be drawn from the fact that only the GSO among campus groups has been forbidden to hold social events.