author: CUMMINGS, Circuit Judge.

text:
    BERGHOFF RESTAURANT CO., INC., Plaintiff-Appellant, v. LEWIS W. BERGHOFF, INC., and Lewis W. Berghoff, Defendants-Appellees.
    No. 73-1686.
    United States Court of Appeals, Seventh Circuit.
    Argued April 15, 1974.
    Decided July 22, 1974.
    Rehearing en banc Denied Aug. 16, 1974.

      James T. Fitzgibbon, Chicago 111., for plaintiff-appellant.
    Dennis A. Gross, Anthony R. Chiara, Chicago, 111., for defendants-appellees.
    Before CUMMINGS, PELL and SPRECHER, Circuit Judges.
   CUMMINGS, Circuit Judge.

In its 5-count trademark complaint, plaintiff, the operator of the celebrated restaurant at 17 West Adams Street, Chicago, Illinois, sought damages and injunctive relief principally under the Lanham Act (15 U.S.C. § 1114) and the Illinois Anti-Dilution Statute (Ill.Rev. Stats.1973, ch. 140, § 22).

Plaintiff owns federal and state registrations of the “BERGHOFF” mark, which allegedly has become indelibly associated with plaintiff in the minds of the restaurant-going public. After defendants opened a restaurant using the “BERGHOFF” name, plaintiff filed this suit and sought a preliminary injunction.

Defendant Lewis Berghoff was employed by plaintiff in the family restaurant in Chicago until his termination in 1971. Thereafter he built a restaurant in Elgin, Illinois, which opened in May 1972 under the name “Lewis Berghoff Inn.” It operates as an Illinois corporation, Lewis W. Berghoff, Inc., the co-defendant; the corporation is wholly owned by the individual defendant.

Defendants’ restaurant, which is located 40 miles from plaintiff’s restaurant, is modern in décor and architecture, in contrast to the “Old Chicago” atmosphere of plaintiff. Defendants have used the full name, Lewis Berghoff, in connection with the Elgin restaurant. Their newspaper advertising and ménus have carried a small disclaimer of affiliation with plaintiff. At the time of this appeal, the Elgin restaurant was being operated under the name “Lewis Berghoff’s Mountain House Restaurant,” whereas plaintiff’s restaurant operates as “The Berghoff.”

The present case was initiated one month after defendants opened the Elgin restaurant. After plaintiff’s motion for preliminary injunction was denied, it filed a motion for summary judgment supported by affidavits. Defendants then filed a cross-motion for summary judgment, also supported by affidavits. The district court thereafter issued a memorandum opinion and judgment order granting plaintiff certain injunctive relief. 357 F.Supp. 127. As to the federal and common law trademark claims, the district judge noted the similarity between the last names used in plaintiff’s and defendants’ restaurants. However, he found that there was no confusing similarity between services rendered by the parties and that they were not truly competing for the same clientele. Citing Benrose Fabrics Corp. v. Rosenstein, 183 F.2d 355 (7th Cir. 1950), the district court held that persons are entitled to use their own names except “when the use is dishonest or fraudulent.”

As to the Illinois Anti-Dilution Statute, referring to Polaroid Corporation v. Polaraid, Inc., 319 F.2d 830 (7th Cir. 1963), the , district court held that it afforded relief only when the offending mark is other than an individual’s name.

While recognizing that plaintiff’s goodwill was established through effort and labor and deserving of some consideration despite the fact that defendant’s surname was identical, the court noted that the individual defendant had previously contributed to the Berghoff name, thus requiring a delicate balancing of the equities. Instead of affording complete relief to plaintiff, the court fashioned an injunction requiring defendants to use the individual defendant’s given name “Lewis” with his surname in operating a restaurant business. “Lewis” was to be in the same size letters as “Berghoff.” Except for one billboard and the sign above the Elgin restaurant, defendants were directed to use the disclaimer “Not affiliated with the Berghoff Restaurants of Chicago” in their advertising and on the front of their ménus. The individual defendant was ordered to file a report with the district court 60 days after the entry of the decree showing how compliance was effected.

On appeal, plaintiff urges that the district court erred in ruling that the Illinois Anti-Dilution Statute contained in the Illinois Trademark Act does not apply to the use of surnames as trademarks, thus denying plaintiff an injunction against any use of the mark. Plaintiff argues in the alternative that under the federal trademark statute, “a full and fair hearing” of the merits of its case should have been held, so that it could prove entitlement to an injunction against any use of its mark under federal law as well.

The Illinois Trademark Act, including the so-called Anti-Dilution Statute, expressly applies to surnames. Ill.Rev. Stats.1973, eh. 140, § 8(f). It also requires the registration of a surname mark that has become distinctive of the applicant’s goods or services, and continuous use for the preceding five year's is evidence of distinctiveness. Ill.Rev. Stats.1973, ch. 140, § 9(e). On surname trademarks generally, see 3 Callmann, Unfair Competition Trademarks and Monopolies (3d ed. 1969), § 85.2; Hat Corp. v. D. L. Davis Corp., 4 F.Supp. 613 (D.Conn.1933).

As to relief under the Anti-Dilution Statute, we are of course bound by Illinois law. Although the statute says that “courts * * * shall * * * enjoin subsequent use” of any similar mark if there exists a likelihood of dilution, the Appellate Court of Illinois has determined in Edgewater Beach Apts. Corp. v. Edgewater Beach Mgt. Co., Inc., 12 Ill.App.3d 526, 534, 299 N.E.2d 548 (1st Dist. 1973), that “Where traditional remedies under theories of unfair competition are available, relief under the [Anti-Dilution] statute should not be granted.” Thus in view of the injunctive relief afforded plaintiff under federal law, the district court was within its rights in denying relief under this Illinois statute. Cf. Alberto-Culver Co. v. Andrea Dumon, Inc., 466 F.2d 705, 709 (7th Cir. 1972). Plaintiff has cited no Illinois authority holding that the Anti-Dilution Statute mandatorily requires an injunction against all use of a trade name, such as requested by this plaintiff. Our opinion in Polaroid Corporation v. Polaraid, Inc., 319 F.2d 830, 837, is not contra, for Judge Major emphasized that there plaintiff coined a strong name, exclusively appropriated by plaintiff, with a close resemblance to defendant’s trade name, and with numerous incidents of confusion. Such factors are not present here.

As to the Lanham Act, Congress granted the district court “power to grant injunctions, according to the principles of equity and upon such terms as the court may deem reasonable * *• 15 U.S.C. § 1116. The Lanham Act did not require the court below to restrain all use of the “BERGHOFF” name. Although we do not adopt all the reasoning of the district court, the carefully tailored result is supportable on the evidence presented and is akin to the relief fashioned in Horlick’s Malted Milk Corp. v. Horlick, 143 F.2d 32, 36-37 (7th Cir. 1944).

Plaintiff is not entitled to a remand for further hearing on its federal claim, as requested. While the procedural history of this case is somewhat irregular, plaintiff has no basis for complaint. After a three-day hearing on its motion for preliminary injunction, plaintiff moved to consolidate the trial with the hearing just completed, and stated that “the issues raised by the pleadings, other than those concerning plaintiff’s damages, have already been fully litigated * * This motion was withdrawn after defendants objected.

Plaintiff then filed a motion for summary judgment on its state claim, stating that its federal claim involved additional issues as to which it would be unnecessary to offer proof if its state claim were granted. Defendants then filed a cross-motion for summary judgment as to all counts of the complaint. Plaintiff moved to strike the cross-motion, repeating its argument 'that it had not yet become necessary to prove all the elements of its federal claim. Nonetheless, on February 27, 1973, the court entered an order granting defendants leave to file their cross-motion and taking it under advisement. It thereupon became necessary for plaintiff to present affidavits or other evidence demonstrating the existence of a genuine issue for trial if it wished to preserve the right to a further hearing. When a motion for summary judgment is filed, “an adverse party may not rest upon the mere allegations and denials of his pleading,” Federal Rule of Civil Procedure 56(e); similarly, plaintiff could not rest on its view that it would have been a more orderly procedure for the court to reserve the federal claim for later consideration. The district judge-was in control of his calendar, and plaintiff was bound by his ruling that defendants’ motion would be considered at that time. Since the cross-motions were not decided until April 16, 1973, there was ample time to file further affidavits. We think that under' all the circumstances of this case, plaintiff is not entitled to present additional evidence as to the relief sought but not granted.

Decree affirmed.


source: Caselaw Access Project

author: J. JOSEPH SMITH, Circuit Judge:

license: Public Domain

text:
    ESTATE of Herman KAHN, Deceased, et al., Appellants, v. COMMISSIONER OF INTERNAL REVENUE, Appellee. Joseph E. BROOKS and Alice K. Brooks, Appellees, v. COMMISSIONER OF INTERNAL REVENUE, Appellant. Monroe J. WEINTRAUB and Carol Weintraub, Appellees, v. COMMISSIONER OF INTERNAL REVENUE, Appellant.
    Nos. 1095-1097, Dockets 73-2500, 74-1013, 74-1015.
    United States Court of Appeals, Second Circuit.
    Argued May 20, 1974.
    Decided June 17, 1974.

      John S. Nolan, Washington, D. C. (Miller & Chevalier, Washington, D. C., Robert L. Moore, II, and F. Brook Voght, Washington, D. C., of counsel), for appellants.
    John A. Townsend, Atty., Tax Div., Dept, of Justice, Washington, D. C. (Scott P. Crampton, Asst. Atty. Gen., Meyer Rothwacks and Jonathan S. Cohen, Attys., Tax Div., Dept, of Justice, Washington, D. C., of counsel), for appellee Commissioner.
    Before SMITH and TIMBERS, Circuit Judges, and TYLER, District Judge.

       Of the Southern District of New York, sitting by designation.

   J. JOSEPH SMITH, Circuit Judge:

This is an appeal from a decision in favor of the Commissioner of Internal Revenue by the Tax Court, Goffe, Judge. The Ta.x Court held taxpayer’s joint venture, H. Kahn & Associates, was in reality a proprietorship, and that therefore all of its income was taxable to Kahn; that the venture’s principal assets were “property held . . . primarily for sale ... in the ordinary course of business” and therefore not entitled to capital gains treatment, 26 U.S.C. § 1231, and that income from a contract performed by one of Kahn’s subsidiaries must be attributed to the venture. We affirm in all respects.

Herman Kahn was a successful businessman engaged in the liquidation of manufacturing companies; Maurice Grober was the president of Condenser Service and Engineering, one of Kahn’s acquisitions. In 1955 the Old Camden Forge Company tried to lure Grober away from Kahn but failed as Kahn promised Grober greater economic gains. The chance to make good on this promise came a few months later when Camden Forge, unable to operate profitably without Grober, offered to sell its business to him. Grober, who was without sufficient resources of his own, reported the offer to Kahn, and together with Kahn, his wife and daughters, Alice K. Brooks and Carol Weintraub, formed Associates, which purchased the troubled company.

After completing work in progress, Kahn — pursuant to the venture agreement — embarked on his normal course of liquidating the Camden Forge assets. However, Kahn misappropriated a substantial portion of the liquidation proceeds, apparently with the objective of defrauding both Grober and the government of their respective shares.

In 1959 and 1960 the Service discovered these misappropriations and assessed deficiencies against each of the joint venturers. Although Kahn paid Grober’s share of these back taxes, a bitter dispute developed between the two, culminating in Grober’s discharge in early 1961. The deposed “partner” thereupon instituted an accounting action in the state courts for his 25% share. In 1964, the New Jersey Superi- or Court held that Grober was indeed entitled under the venture agreement to some $181,000.

Three years later, the Service assessed further deficiencies against Kahn and Grober on a partnership theory, but subsequently amended its pleadings to claim that since Associates was in reality controlled by Kahn, he should be taxed on its entire income. Following general findings by its trial commissioner, the Tax Court agreed.

I.

Taxpayer’s primary contention is that by largely ignoring the partnership finding of the state court — which admittedly conducted a more extensive inquiry into the venture’s history — the Tax Court erroneously concluded that the “partnership” existed in form only. We cannot agree.

First, it is clear that whether Associates was a partnership for tax purposes is a matter of federal, not local, law. Commissioner of Internal Revenue v. Tower, 327 U.S. 280, 287-288, 66 S.Ct. 532, 90 L.Ed. 670 (1946); Burde v. Commissioner of Internal Revenue, 352 F.2d 995, 1002 (2d Cir. 1965), cert. denied, 383 U.S. 966, 86 S.Ct. 1271, 16 L.Ed.2d 307 (1966). This difference is particularly significant here, for while the state court looked almost exclusively to the venture agreement in upholding Grober’s claim, such an agreement is but one factor in determining whether a partnership exists for tax purposes. As summarized in Hubert M. Luna, 42 T. C. 1067, 1077-1078 (1964), the relevant factors include:

The agreement of the parties and their conduct in executing its terms; the contributions, if any, which each party has made to the venture; the parties’ control over income and capital and the right of each to make withdrawals; whether each party was a principal and co-proprietor, sharing a mutual -proprietary interest in the net profits and having an obligation to share losses, or whether one party was the agent or employee of the other, receiving for his services contingent compensation in the form of a percentage of income; whether business was conducted in the joint names of the parties; whether the parties filed Federal partnership returns or otherwise represented to respondent or to persons with whom they dealt that they were joint venturers; whether separate books of account were maintained for the venture; and whether the parties exercised mutual control over and assumed mutual responsibilities for the enterprise.

See also, Commissioner of Internal Revenue v. Culbertson, 337 U.S. 733, 742-743, 69 S.Ct. 1210, 93 L.Ed. 1659 (1949); Smith’s Estate v. Commissioner of Internal Revenue, 313 F.2d 724, 728-730 (8th Cir. 1963).

Turning to the facts here, we believe the Tax Court was clearly correct in concluding that Associates was not a true partnership. While it is true that the agreement gave Grober a 25% interest in the venture’s assets, that interest was expressly limited to the profits that would be derived from their operation and sale: Control of the assets — including the power to • dispose of them — was vested solely in Kahn. Similarly Grober’s interest was expressly subordinated to Kahn’s expenses in purchasing and liquidating the assets— most notably his contribution of $495,000 of their $500,000 purchase price; and it was further contingent on Grober’s continued employment for at least six months. While such a subordinated and contingent claim might represent a true partnership interest under some circumstances, it is also quite consistent with the Commissioner’s theory that Grober was but a key employee who was to be rewarded with a percentage of the profits. See, Schermerhorn Oil Co., 46 B.T.A. 151, 158-59 (1942); A. L. Parker, 5 T.C. 1355, 1363 (1945).

Kahn’s dominant position and his contribution of 99% of the assets’ purchase price was further reflected in the venture’s operation. While there is some dispute as to Grober’s day-to-day authority and his right to examine the venture’s books, the fact remains that Kahn had sufficient legal and practical control to misappropriate some $400,000 over a three-year period without detection by his defrauded “partner.” Similarly it is undisputed that when the Service uncovered Kahn’s activities and the split occurred, it was Grober, and not Kahn, who was soon sent packing. Such facts are hardly consistent with taxpayer’s portrayal of Grober as an equal partner; rather they suggest that Grober was merely an important, but by no means indispensable, employee.

Finally, we should note that Kahn’s fraud vitiated the very profit-sharing arrangement the state court held to be so critical. Between 1955 and 1961, Grober received only $5500 in profits, when in reality the state court found that the correct amount should have been more than $100,000.

In sum, we must agree with the Tax Court that while Associates may have been a partnership in form, it was, in reality and for tax purposes, a sole proprietorship controlled by Kahn.

II.

Turning briefly to taxpayer’s other points on appeal, we find that the Tax Court quite properly held that Associates was not entitled to capital gains treatment on the sale of the Camden Forge assets and that it was taxable on income from a servicing contract performed by Kahn’s subsidiary, Condenser.

A number of facts demonstrate that Associates’ “primary purpose,” Malat v. Riddell, 383 U.S. 569, 571-572, 86 S.Ct. 1030, 16 L.Ed.2d 102 (1966), in purchasing the Camden Forge assets was to liquidate them as soon as the six-month holding period for long-term capital gains treatment was achieved: That liquidating such assets was Kahn’s business; that only a few months after the acquisition, Kahn began his usual, extensive advertising campaign in preparation for the sale; that the principal post-acquisition production from the assets was work in progress which had to be completed as part of the purchase agreement; and finally, that the initial sale occurred only three days after the six-month holding period elapsed. See, Smith v. Dunn, 224 F.2d 353, 356-357 (5th Cir. 1955); United States v. Winthrop, 417 F.2d 905, 909-910 (5th Cir. 1969).

In response, taxpayer argues that Kahn and Grober originally intended to operate the Camden Forge plant and decided to liquidate it only after realizing that its continuation would be unprofitable. But this contention is undercut not only by the factors noted above, but also by Grober’s report to Kahn prior to the acquisition which candidly concluded that with Kahn’s “usual handling” a profit could be realized “from the sale of the facilities, . . . completing the work in progress and disposition of the inventory.”

There is similarly little merit in taxpayer’s contention ' that the income derived from Camden Forge’s servicing contract with the Navy should be attributed to Condenser merely because it performed the actual work. On closer examination, it becomes clear that Condenser was but the corporate agent of Kahn and Associates. Kahn contracted with the Navy in his own name and was directly obligated to perform. He in turn billed the Navy in his own name and received the payments directly. See, National Carbide Corp. v. Commissioner of Internal Revenue, 336 U.S. 422, 437, 69 S.Ct. 726, 93 L.Ed. 779 (1949). In short, the Commissioner’s attribution of the income directly to Associates was neither unreasonable nor arbitrary. See, Charles Town Inc. v. Commissioner of Internal Revenue, 372 F.2d 415, 422 (4th Cir.), cert. denied, 389 U.S. 841, 88 S.Ct. 69, 19 L.Ed.2d 104 (1967).

The judgment of the Tax Court is affirmed on each appeal before this court.

      . The Tax Court as a result of these findings determined that there were overpayments by taxpayers, Mr. and Mrs. Grober, Mr. and Mrs.' Brooks and Mr. and Mrs. Weintraub who had been taxed as partners of Kahn. Protective appeals were filed by the Commissioner, the Grober appeal now pending in the Third Circuit, the Brooks and Weintraub appeals consolidated with the instant appeal.

      . Most notably, tbe state court was able to assess the credibility of several witnesses— including Kahn- — -who were unavailable to the Tax Court. However as reflected by its opinion, the state court’s focus was on the details of Kahn’s misappropriations, not the attributes of a true partnership. Thus its extensive findings on Kahn’s fraud do not really conflict with the Tax Court’s conclusion that he was' in virtually complete control.

      . Indeed in discussing the interests of Kahn’s wife and daughters, the state court explicitly recognized that the attributes of a partnership under state and federal law are not the same. Moreover in reviewing the Superior Court’s decision on another ground, the New Jersey Supreme Court found its partnership finding to be “debatable.” 47 N.J. 135, 219 A.2d 601, 607 (1966).

      . Since as a matter of law no one factor is controlling in this parnership determination, Burde v. Commissioner of Internal Revenue, 352 F.2d 995, 1002 (2d Cir. 1965), cert. denied, 383 U.S. 966, 86 S.Ct. 1271, 16 L.Ed.2d 307 (1966), it follows that since the Tax Court applied the proper legal standard, both its findings on each individual factor and its overall assessment of their varying weights must be upheld unless clearly erroneous. Burde v. Commissioner of Internal Revenue, supra; Cleveland v. Commissioner of Internal Revenue, 297 F.2d 169, 172 (4th Cir. 1961).

      . In further assessing the parties’ intent, we note that while Grober objected to the percentage and vesting provisions in the first draft of the agreement, he expressed no displeasure with the sections giving Kahn absolute control which the state court found increased as the agreement was re-drafted to suit Grober.

      . Taxpayer argues that Grober’s partnership status is demonstrated by the fact that he claimed partnership losses — on tax returns prepared by Kahn — during three of the years in question. However in view of the fact that there was no provision for such loss-sharing in the venture agreement and that these paper losses produced substantial tax benefits, this factor is not particularly significant.

      . In so holding, we are not unmindful of Beck Chemical Equipment Corp. v. Commissioner of Internal Revenue, 27 T.C. 840 (1957), where the Tax Court concluded that a partnership existed despite a set of facts rather similar to those here. However, since a partnership determination is a factual matter, neither Beeh Chemical nor any other prior case has controlling precedential value. Whatever the merits of its decision in Beck Chemical, we believe the Tax Court struck the correct balance here.


author: PER CURIAM.

text:
    Frank GAVINO, Petitioner, v. Hon. Lloyd F. MacMAHON, United States District Judge, Southern District of New York, Sitting by Designation in the Northern District of New York, Respondent. UNITED STATES of America, Plaintiff, v. Frank GAVINO et al., Defendants.
    No. 1184, Docket 74-1785.
    United States Court of Appeals, Second Circuit.
    Argued June 11, 1974.
    Decided June 14, 1974.

      Sanford M. Katz, New York City, and H. D. Stave, Forest Hills, N. Y., for petitioner.
    Paul V. French, Asst. U. S. Atty. (James M. Sullivan, Jr., U. S. Atty., N. D. N. Y„ Thomas P. O’Sullivan, Asst. U. S. Atty., Albany, N. Y., of counsel), for respondent.
    Before HAYS and MANSFIELD, Circuit Judges, and BAUMAN, District Judge.

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

   PER CURIAM.

Frank Gavino, a resident of Tucson, Arizona, and one of five defendants named in an indictment filed in the Northern District of New York charging violation of the narcotics laws, 21 U.S.C. §§ 841(a)(1) and 846, has petitioned us for a writ of prohibition and mandamus directed to Judge Lloyd F. MacMahon, sitting by designation in the Northern District of New York, to stay an order issued by him in open court on June 7, 1974, revoking Gavino’s bail and directing all defendants to proceed to trial before him on June 17, 1974, even though the indictment had been filed in April, 1974, and the defendants had been arraigned in May 1974 (one as late as May 20). The petition is granted.

On April 10, 1974, a federal grand jury sitting in Albany, New York, filed an indictment charging Frank Gavino, Harvey Lawrence, Allen Smith, Kenneth Adler, and William Barber with conspiracy to violate § 841(a)(1) and defendants Barber and Lawrence with possession of narcotics with intent to distribute in violation of that section. Gavino was thereafter arrested in Tucson, Arizona, and held in custody after he was unable to furnish bail in the sum of $150,000. On May 6, 1974, Gavino, appearing with his counsel, Sanford M. Katz, Esq., was arraigned before Chief Judge James T. Foley, who reduced Ga-vino’s bail to $2,000, which was posted. May 20th was fixed as the date for filing of motions. However, Adler was not arraigned until May 20. All parties were then given until June 3d to file motions. The Clerk was further directed to put the ease on the Auburn, New York, calendar for trial before Judge MacMahon, to whom it had been assigned, during the June term.

On June 3, 1974, in response to defense motions for pretrial discovery, including bills of particulars and electronic surveillance, and for dismissal, severance and other relief, the government made available to the defendants extensive discovery material. At the same time, after ruling on all other motions, Chief Judge Foley advised counsel that Judge MacMahon had set the case for trial on June 17. In response to requests for postponement defense counsel were advised to move before Judge MacMahon in Auburn, New York. Motion papers seeking a continuance were hastily prepared by counsel for Gavino, Adler and Barber, advising of the need for additional time.

On June 7, 1974, Judge MacMahon heard the motions for continuance of trial, which were joined in orally by counsel for the defendant Lawrence. Gavino’s counsel confirmed that he was presently engaged in the trial of a murder case in the New York County Supreme Court, which would last for at least two weeks. He further advised that based upon his interview of Gavino and the discovery material that had been turned over by the United States Attorney on June 3d it would be necessary for him as part of his preparation for trial to proceed to New Mexico and Mexico to interview prospective witnesses. The Assistant United States Attorney in charge of the case advised the court and ourselves that he had no objection to a continuance of the trial. Before being cut off by Judge MacMahon he further sought — wisely in our view — to advise the court (as he has advised us by affidavit) “that if the continuance were denied it may [lead] to a subsequent appeal based on the rationale of láek of effective counsel, with respect to the defendant Gavino, due to the remoteness of counsel from his client, and counsel’s statement that he has only conferred with his client on one occasion and [that] due to other responsibilities [he] would not be able to confer with his client until trial.”

The scene which ensued is disclosed by the following portion of the transcript :

“The Court: All right. I am revoking the bail, I want to appoint other counsel, this lawyer is too busy to handle this case.
“Mr. Katz: Your Honor, the trial date—
“The Court: I am removing you from the case, sir, you are not ready to go on adequate notice, you have more business than you can handle. This court’s business cannot wait to suit your convenience.
“Mr. Katz:. Sir, it was never anticipated that we would proceed to trial within one month of arraignment and—
“The Court: The United States Judicial Conference has had a resolution requiring all criminal cases to be tried within sixty days. Get with it. Here is an April indictment—
“Mr. Katz: April of 1974.
“The Court: I have ruled, counsel, if you are not here, revoke the bail, issue a warrant, get him back to this district to appear before me forthwith as soon as he can.
“Mr. Katz: Well, if Your Honor please, there is no basis for it, the trial date is June 17, he hasn’t violated — •
“The Court: Take it up with the Court of Appeals.
“Mr. Katz: I will, sir.
“The Court: I am revoking the bail. You won’t interfere with the trial date of this case, as this is a multiple defendant case in which there are a number of defendants. The Government is ready to go. The court has been sent up here to this district from New York to relieve the congested calendar and try these cases, and these sort of excuses, counsel otherwise engaged, and you have to inter.view and this and that simply won’t go.
“Mr. Katz: Your Honor—
“The Court: I am revoking the bail, so we can get him here solely for the purpose of advising him of his rights to counsel and get other counsel.
“Mr. Katz: I will undertake, as an officer of the court, to advise him accordingly. There is no need to have him brought under arrest from Tuscon [sic], Arizona, to this district. He has. violated no condition of his bail.
“The Court: One of the conditions of bail is he be here prepared to proceed when the court is ready to proceed.”

Having thus disposed of Gavino’s motion, Judge MacMahon turned to that of defendant Kenneth Adler, who was represented by Howard Stave, Esq. The transcript continues:

“Mr. Stave: I wish to point out to the court my client was arraigned on May 20. I made motions returnable June 3rd. I had co-counsel in Albany County handle the arraignment, and I submitted the motion to Judge Foley on June 3rd. I was not advised of this calendar situation until the late evening of June 3rd when co-counsel advised me. I never received a notice.
“The Court: So what?
“Mr. Stave: If I might, I received in the mail on Wednesday afternoon the Government’s discovery. I have not had a chance to discuss this case. My client was originally apprehended in Little Rock, Arkansas. We brought him back the next day. He just came back to Long Island to work. I am really, Your Honor, not prepared. I have a murder case on the calendar of Queens. County on June 17.
“I would respectfully request the court to consider that. I submitted an affidavit to Your Honor that this ease be allowed to be adjourned to September 3, at which time I will absolutely warrant and represent to the court, that is the first day of the term, I will be ready for a trial, because I have not been properly notified. My client on May 20 was first arraigned. This is only June 7. I would humbly beseech the court to consider the fact that my client’s rights may be prejudiced. I do not think—
“The Court: Where is your client? What is his bail ?
“Mr. Stave: My client is on $5,000 bail. He is available, no problem about that.
“The Court: Revoke his bail and get him up here.
“Mr. Stave: Judge, may I say this, Judge, please. He is available to me. What I am saying to you is that I think'—
“The Court: I want him up here before the court.
“Mr. Stave: Well, Judge, I will bring him up here on June 17.
“The Court: Ready to go to trial?
“Mr. Stave: I prefer not to.
“The Court: I am not asking you what you prefer. I am directing you to be here prepared to go to trial with the witnesses and ready to go. Unless you can represent to this court that you are in all respects ready to do so, I will revoke your client’s bail, get him out here and substitute counsel.
“Mr. Stave: I represent to the court I will bring him up here on June 17 to go to trial. Nevertheless, I would still, if I might, just press a bit further. Considering the situation, Judge, where I have just been notified, I just got the documentation, I would greatly ask the court’s discretion, that is all I am doing here, to ajourn this ease to September to give us more time.
“The Court: I am not adjourning this case for over 90 days. That is ridiculous in a narcotics case. No.
“All right.
“Mr. Cheeseman: Your Honor, my client also was not arraigned until late in May, and just this Monday we also were furnished with voluminous material as a result of motions we brought.
“I was surprised to hear that the case was set down for the 17th, and I approached Judge Foley, and it is at his suggestion that I came out here, and I thought that perhaps by asking a favor of you, I might get the ease put over.
“Now before we go any further, if I am ordered by this court to be here the 17th, I will be here with my client the 17th, and I will go through the formalities of a trial, but in all honesty, Your Honor, I don’t see how I can be prepared in such an important case where I have literally dozens of witnesses yet to interview. If you tell me to do it, I will do my best, but it won’t be good enough.
“The Court: I am directing you to do it.”

In contrast to Judge MacMahon’s determination to bring the case to trial immediately, Assistant United States Attorney O’Sullivan simply stated that the government did “not object to the continuance” of the case. This petition for a writ of mandamus followed.

DISCUSSION

The appealability, as a “final decision,” 28 U.S.C. § 1291, of an order unlawfully denying bail prior to trial in a noncapital case is settled. Stack v. Boyle, 342 U.S. 1, 72 S.Ct. 1, 96 L.Ed. 3 (1951); United States v. Foster, 278 F.2d 567 (2d Cir.), cert. denied, 364 U.S. 834, 81 S.Ct. 48, 5 L.Ed.2d 60 (1960); United States v. Bentvena, 288 F.2d 442 (2d Cir.), affd., 81 S.Ct. 642 (1961); United States v. Gilbert, 138 U.S.App.D.C. 59, 425 F.2d 490 (1969).

“ ‘Unless this right to bail before trial is preserved, the presumption of innocence, secured only after centuries of struggle, would lose its meaning.’ [Emphasis supplied.]” United States v. Bentvena, 288 F.2d at 445, quoting Stack v. Boyle, 342 U.S. at 4.

Since “[r]elief in this type of case must be speedy if it is to be effective,” 342 U.S. at 4, recourse to appellant review, by way of an interlocutory appeal pursuant to the reasoning of Cohen v. Beneficial Loan Corp., 337 U.S. 541, 69 S.Ct. 1221, 93 L.Ed. 1528 (1949), has been recognized, see United States v. Foster, supra at 570 (Friendly, C. J., concurring), and we have on occasion entertained an application in the form of a “motion, subject to the filing of an appropriate notice of appeal,” see United States v. DiPietro, 302 F.2d 612 (2d Cir. 1962). Because of the extreme urgency of the present application, the readily apparent absence of any justification for the district court’s action, and the irreparable harm that would result to petitioner if the district court’s order were enforced, we have entertained the application for mandamus relief. See Woodcock v. Donnelly, 470 F.2d 93, 94 (1st Cir. 1972).

The Bail Reform Act, 18 U.S.C. § 3146, et seq., like its predecessor, Rule 46(a)(1), F.R.Cr.P., guarantees that in a noncapital case the defendant will have the pretrial right to release on bail except in extreme and unusual circumstances, e. g., where threats to a government witness would jeopardize the court’s own processes, see Carbo v. United States, 82 S.Ct. 662, 7 L.Ed.2d 769 (1962) (memorandum opinion of Mr. Justice Douglas). Although the trial judge is accorded discretionary power during trial to revoke bail where such drastic relief is essential to insure the orderly progress of an on-going trial, see Fernandez v. United States, 81 S.Ct. 642, 5 L.Ed.2d 683 (1961) (memorandum of Mr. Justice Harlan), such power must be “exercised with circumspection,” United States v. Bentvena, supra at 445, and does not extend to revocation of bail before trial, which is the situation confronted here.

Judge MacMahon’s sole excuse for his sudden and unexpected revocation of Gavino’s bail was that since Gavino’s counsel, because he was presently engaged on trial elsewhere, could not be ready for trial on June 17, the Judge wished to have Gavino taken into custody and returned immediately from Arizona so that the court could “appoint other counsel” to represent him. Even accepting the district judge’s discretionary power to refuse to recognize an attorney’s pending engagement in another criminal case as a valid basis for postponement of trial, the revocation of Gavino’s bail was wholly unjustified and represented arbitrary and capricious action. There was no evidence that Gavino had violated the conditions of his bail or that he would not return immediately to the jurisdiction if so directed by the court. The revocation of bail because of his counsel’s unavailability for trial would unquestionably violate his fundamental rights.

Even assuming arguendo that, unless Gavino’s bail was revoked, the case could not be brought to trial on June 17th, no reasonable ground appears for such impetuous and precipitous action. It is true that the prompt disposition of criminal eases has been a matter of continuing concern to the Circuit Council for the Second Circuit, leading to the promulgation on January 1, 1971, of “Second Circuit Rules Regarding Prompt Disposition of Criminal Cases,” effective July 5, 1971, which were superseded by. the ’ “Plan for Achieving Prompt Disposition of Criminal Cases” adopted by each of the Districts within the Second Circuit, including the Northern District of New York, effective April 1, 1973. As we said in promulgating the Rules, however, they were intended to promote disposition of criminal charges with “reasonable dispatch,” uninhibited by delays “for which there is no good reason.” They were never designed to permit a district court to ride roughshod over the right of a defendant to prepare for trial. Indeed they were aimed principally at prosecutorial delay, see Hilbert v. Dooling, 476 F.2d 355, 357 (2d Cir.) (en bane), cert. denied, 414 U.S. 878, 94 S.Ct. 56, 38 L.Ed.2d 123 (1973), and provide that the government must be ready for trial within six (6) months from the date of arrest, subject to exclusion of certain periods of delay recognized by Par. 5. Here the district court seeks to bring this multi-defendant criminal case to trial approximately one (1) month after the arraignment of the defendants and two (2) weeks after extensive pretrial discovery, despite the requests of defendants for a reasonable time to prepare and to interview witnesses, some of whom are located in New Mexico and Mexico, and despite the willingness of the government to consent to a reasonable adjournment.

Without minimizing the importance of the public interest in prompt disposition of criminal cases, we cannot allow our concern with calendar dispatch to triumph over a defendant’s right to a fair trial, which is the foundation of our system of justice. To sacrifice a fair trial to the interest of expedition would surely undermine the true administration of justice. See Stans v. Hon. Gagliardi, 485 F.2d 1290, 1292 (2d Cir. 1973). Nor does the criminal caseload of the Northern District indicate cause for emergency measures. As of the end of May, 1974, there were 170 criminal cases pending in that district, of which only 5 cases were more than six (6) months old. Monthly Caseload Status Report, District Court for the Northern District of New York for Month Ending May, 1974; General Case Report, Form 74, prepared by United States Attorney for the Northern District of New York.

The respondent’s revocation of defendant Gavino’s bail exceeded the court’s powers and, in connection therewith, his refusal to grant a reasonable adjournment of trial represented a gross abuse of discretion. Accordingly, the petition is granted. The writ will issue directing respondent to vacate the order revoking the bail of the defendant Frank Gavino and to postpone the trial of the action until a date not earlier than July 24,1974.

       We are further advised by the United States Attorney for the Northern District of New York that approximately 100 of the 170 cases must be held in abeyance because the defendants are fugitives from justice.


author: WILLIAM E. MILLER, Circuit Judge.

text:
    Dorothy WEATHERS, Plaintiff-Appellant, v. PETERS REALTY CORPORATION et al., Defendants-Appellees.
    No. 73-1950.
    United States Court of Appeals, Sixth Circuit.
    Argued April 18, 1974.
    Decided July 5,1974.

      Richard Brudzynski, Avery S. Friedman, Cleveland, Ohio, for plaintiff-appellant.
    Stanley D. Gottsegen, Gottsegen, Tucker & Blake, Cleveland, Ohio, for defendants-appellees.

      Before PHILLIPS, Chief Judge, and MILLER and LIVELY, Circuit Judges.
   WILLIAM E. MILLER, Circuit Judge.

The named plaintiff, Dorothy Weathers, a black person, filed the present class action against the defendants, Peters Realty Corporation and others, “on behalf of herself and all other black citizens of the United States who have been or will be seeking housing” at a thirteen rental suite apartment building owned by the Peters Realty Corporation in Cleveland Heights, Ohio.

The complaint sought injunctive relief and also monetary damages in the amount of $10,000 compensatory damages and $10,000 punitive damages for “the Plaintiff and the class she represents.”

The genesis of the action occurred when the plaintiff visited the defendants’ apartment building to inquire about renting an apartment suite and was told by Mrs. Dailey, wife of the apartment’s custodian, that no suites were available. The plaintiff apparently had prior information about the pending availability of suite No. 1 in the apartment. She testified that she obtained the information from a Mr. Niermann, a friend of hers. Prior to the plaintiff’s visit, Niermann and his wife, who are white, visited the apartment building, ostensibly seeking to rent a suite, and obtained a promise from Mrs. Dailey to hold for them the No. 1 suite which was about to be vacated. Niermann, obviously timing his call immediately to precede the plaintiff’s visit to the apartment, telephoned Mrs. Dailey, according to his testimony, to withdraw his previously expressed interest in suite No. 1. After the plaintiff’s visit, a Mr. and Mrs. Lind, a white couple and friends of the plaintiff and the Niermanns, visited the apartment, also to inquire about the availability of a suite. The Linds were shown suite No. 1 by the Daileys. There is testimony to indicate that they told the Linds of the Niermanns’ interest in the suite, but nevertheless offered it for rental to them.

Following the institution of the present action, the defendants offered to rent an apartment suite to the plainiff under the same terms and conditions as extended to the previous tenant who was white. Plaintiff declined the offer.

After conducting a hearing, on the plaintiff’s request for injunctive relief, the district court dismissed the action at the plaintiff’s cost. The dismissal order was based on four conclusions: (1) That the class aspect of the plaintiff’s action was without support in fact and failed to meet the minimal requirements of Rule 23, Fed.R.Civ.P.; (2) That the plaintiff’s motion for preliminary and permanent injunctive relief was mooted by virtue of the defendants’ offer to lease the apartment suite to the plaintiff and her subsequent rejection of the offer; (3) That the plaintiff’s charges of racial discrimination were discredited by the uncontroverted evidence that the apartment house is and has been integrated with a 23% minority occupancy; and (4) That the sale by an operating officer of Peters Realty (Ralph Peters) of his private residence to a black family and his continued residency on the same street at a newly acquired home would further “mitigate” [sic militate] against charges of racial discrimination.

The district court’s holding that the complaint and the evidence presented at the injunction hearing were insufficient to sustain a class action was premature. Rule 23(a) Fed.R.Civ.P. provides:

. (a) Prerequisites to a Class Action. One or more members of a class may sue or be sued as representative parties on behalf of all only if (1) the class is so numerous that joinder of all members is impracticable, (2) there are questions of law or fact common to the class, (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and (4) the representative parties will fairly and adequately protect the interests of the class.

The district court cited Cash v. Swifton, 434 F.2d 569 (6th Cir. 1970), and Pegues v. Bakane, 445 F.2d 1140 (5th Cir. 1971) to support its finding that the plaintiff had failed to meet these prerequisites for maintaining a class action. Since these two cases dismissed class actions because of a failure of the plaintiff to meet the numerosity requirement of Rule 23(a), we must assume that this was the same flaw that the district court in this case found in the plaintiff’s action. In civil rights cases of the nature of the present case, the numerosity requirement is usually satisfied by the showing of a colorable claim by the named plaintiff who is a member of a larger class having potentially similar claims. See Wright and Miller, 7 Federal Practice and Procedure Sec. 1762 (1972). Although the district court has broad discretion in determining whether a particular action complies with Rule 23(a), by meeting all four requirements, the application of these requirements should not be so strictly applied that the policies underlying class actions would be undermined. The plaintiff made allegations that she was discriminated against because of her race. She also alleged that there are others of her race “who are, have been or will be seeking housing” at the defendants’ property.

It is true that an action is not maintainable as a class action merely because it is designated as such in the pleadings. See generally, 3B Moore, Federal Practice, Par. 23.02-2, 230.5 (2d 1969). Mere repetition of the language of Rule 23(a) is not sufficient. There must be an adequate statement of the basic facts to indicate that each requirement of the rule is fulfilled. Maintainability may be determined by the court on the basis of the pleadings, if sufficient facts are set forth, but ordinarily the determination should be predicated on more information than the pleadings will provide. Huff v. N. D. Cass Co. of Alabama, 485 F.2d 710 (5th Cir. 1973). The district court conducted a preliminary hearing focused on the requested preliminary injunctive relief. The parties should be afforded an opportunity to present evidence on the maintainability of the class action. In making this determination the district court must in addition to applying the prerequisites of 23(a) ascertain if the class comes within one of the three categories of Rule 23(b). In this case, from the pleadings and the nature of the case itself, the plaintiff’s class appears to be, if it qualifies as a class at all, a 23(b)(2) class. Rule 23(b)(2) provides:

the party opposing the class has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole; or

In attempting to define a (b)(2) class, it should be noted that the category may in some instances be quite broad in scope. The nature of the primary relief sought in this category, injunctive or declaratory relief, does not require that the class be as narrowly confined as under either (b)(1) or (b)(3). Of course some or all of the members of a (b)(2) class may seek additional relief, for example, monetary damages, as the present plaintiff has done. When monetary damages are sought the reasons that district courts may see fit to confine the class more narrowly are, first, to protect the defendant in preparing his defenses against various damage claims, and second, to make the disposition of the class action more manageable since the evidence as to individual claims may vary widely in scope and character. If both injunctive or declaratory relief, and monetary damages are sought, it is permissible under Rule 23(c)(4) to have sub-classes. All sub-classes must meet the same requirements as a class. But the practical differences between the members of the class seeking injunctive or declaratory relief and those members seeking monetary damages in addition, may make the division into sub-classes necessary in some eases. See Wright and Miller, 7 Federal Practice and Procedures Sec. 1790 (1972). Thus, even if a plaintiff may be unable to state a sub-class for monetary damages with the proper specificity, it may be possible to specify a class for injunctive relief. See Korn v. Franchard Corp., 456 F.2d 1206 (2d Cir. 1972).

Additionally, when determining the maintainability of a class action, the district court must confine itself to the requirements of Rule 23 and not assess the likelihood of success on the merits. As the Supreme Court recently stated in Morton Eisen, etc. v. Carlisle & Jacquelin et al., 417 U.S. 156, 177, 94 S.Ct. 2140, 2152, 40 L.Ed.2d 732 (1974):

“We find nothing in either the language or history of Rule 23 that gives a court any authority to conduct a preliminary inquiry into the merits of a suit in order to determine whether it may be maintained as a class action. . ■ In short, we agree with Judge Wisdom’s conclusion in Miller v. Mackey International, 452 F.2d 424 (CA5 1971), where the court rejected a preliminary inquiry into the merits of a proposed class action:
‘In determining the propriety of a class action, the question is not whether the plaintiff or plaintiffs have stated a cause of action or will prevail on the merits, but rather whether the requirements of Rule 23 are met.’ Id., at 427.”

As we shall see later, the district court’s decision that the named plaintiff had not been discriminated against was decided by exclusive reliance on evidence which, standing alone, we deem to be insufficient to rebut the plaintiff’s case on the issue of discrimination against her. We are concerned that the decision on the merits of the plaintiff’s personal claim of discrimination strongly influenced the district court’s decision on the maintainability of the class action.

The district court’s conclusion that the plaintiff’s motion for injunctive relief was mooted by the defendants’ offer to rent the suite to her is predicated on the assumed absence of a party to the action who would benefit from such relief. The district court apparently reasoned that the plaintiff is entitled to pray for relief for herself, but not for others who it assumed were not properly before it. But mooting the named plaintiff’s personal claim for injunctive relief, does not preclude this form of relief if, as we have decided, the issue of the maintainability of a class action is still open. To allow a defendant to moot a “fair housing” class action by making concessions to the named plaintiffs would thwart the purposes of this important type of litigation.

The district court in finding that the defendants did not discriminate against the plaintiff relied upon statistical data concerning the racial distribution of the defendants’ tenants and the seemingly unbiased attitude toward blacks on the part of the corporation’s controlling officer.

The Fair Housing Act of 1968, 42 U. S.C. Sec. 3604, provides in pertinent part:

As made applicable by section 3603 of this title and except as exempted by sections 3603(b) and 3607 of this title, it shall be unlawful—
(a) To refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, or national origin.
# * * *x- * *x-
(d) To represent to any person because of race, color, religion, or national origin that any dwelling is not available for inspection, sale, or rental when such dwelling is in fact so available.

In cases construing this statute, statistics have often been used to aid in establishing the existence of racial discrimination. See Otero v. New York City Housing Authority, 484 F.2d 1122 (2d Cir. 1973), and Johnson v. Jerry Pals Real Estate, 485 F.2d 528 (7th Cir. 1973). This same use of statistics is prevalent in cases involving, inter alia, school segregation and employment discrimination. In Parham v. Southwestern Bell Telephone, 433 F.2d 421, 426 (8th Cir. 1970), an employment discrimination ease, the court stated:

In cases concerning racial discrimination, ‘statistics often tell much and the Courts listen.’ State of Alabama v. United States, 304 F.2d 583, 586 (5th Cir.) aff’d per curiam, 371 U.S. 37, 83 S.Ct. 145, 9 L.Ed.2d 112 (1962).

Also, under Rule 42(a), the maximum admissibility rule of the Federal Rules of Civil Procedure, the use of statistics to help defend against charges of racial discrimination would appear to be not impermissible.

The district court, in examining the percentage of minority occupancy of the defendants’ apartments, noted:

A cursory investigation would have revealed that the apartment house had one suite leased to and occupied by a black woman, one suite leased to and occupied by a Japanese family and one suite leased to and occupied by a Pakistani geltleman (sic).

The court then concluded that this 23% minority occupancy would “discredit” allegations of discrimination by the defendants. This approach in our view represents a misapprehension of the effect of statistics pertaining to minority occupancy. It is a well known historical fact that blacks in our country have suffered from racial discrimination in many respects distinguishable in kind and degree from other racial minorities. Where in a case, such as this, the issue involves alleged discrimination against blacks only, statistical percentages including other minorities in the composite picture must be viewed with this distinction in mind. This the district court did not do as it obviously gave too much weight to the 23% minority figure as a factor favorable to the defendants’ case. We do not hold that evidence respecting occupancy by other racial minorities was not admissible in the present case. Our holding is that such evidence should be weighed along with all other relevant evidence in determining the basic issue of black minority discrimination. Such evidence, though relevant, was not conclusive that no racial discrimination existed. So too as to evidence bearing upon the conduct and attitude of the Realty Company’s operating officer. Such tangential evidence is to be weighed in light of the total record and not treated as conclusive.

The district court was confronted with conflicting testimony from witnesses and varying inferences touching upon the issue of discrimination as to blacks. Its duty was to resolve the conflicts and to adopt the more reasonable conclusions from all relevant evidence. This function it did not perform. Rather it selected isolated items of evidence and by over-emphasizing them failed to consider or evaluate other relevant evidence.

Accordingly, the judgment of the district court is reversed and the action is remanded to that court for further proceedings consistent with this opinion.


author: MATTHES, Senior Circuit Judge. PER CURIAM.

text:
    The HOME INDEMNITY COMPANY, Appellant, v. Claude MOORE et al., Appellees.
    No. 74-1018.
    United States Court of Appeals, Eighth Circuit.
    Submitted April 18, 1974.
    Decided June 13, 1974.
    Rehearing Denied July 10, 1974.

      Charles M. Bleil, Texarkana, Ark., for appellant.
    Winford L. Dunn, Jr., Texarkana, Ark., for appellees.

      Before MATTHES, Senior Circuit Judge, ROSS, Circuit Judge, and VAN PELT, Senior District Judge.

       ROBERT VAN PELT, Senior District Judge, District of Nebraska, sitting by designation.

   MATTHES, Senior Circuit Judge.

This is an appeal from an order of the United States District Court for the Western District of Arkansas dismissing an interpleader action filed by the Home Indemnity Company pursuant to 28 U. S.C. § 1332 and Fed.R.Civ.P. 22.

On July 9, 1971, Laurene Maxwell Moore, a citizen and resident of Miller County, Arkansas, was fatally injured in an automobile accident in Cass County, Texas, while engaged in the furtherance of the business of her employer, also a citizen of Arkansas. Subsequent to Mrs. Moore’s death, workmen’s compensation claims were filed with both the Arkansas and Texas workmen’s compensation commissions.

On March 14, 1973, the Texas Industrial Accident Board entered a final award granting full death benefits to the survivors of Mrs. Moore; specifically, a lump sum of $8,187.67 to her husband, Claude Moore, and a lump sum for the same amount to the three minor children of Mrs. Moore, David, Michael, and Cynthia Maxwell. In addition, funeral expenses not to exceed $500 were approved. On April 4, 1973, the Arkansas Workmen’s Compensation Commission awarded Cynthia and Michael Maxwell $19.50 per week, apparently until majority. Although funeral expenses in the amount of $750 were awarded also, neither Claude Moore nor David Maxwell received any benefits under the Arkansas award.

After initiating steps in the courts of the two states to appeal each award, Home Indemnity filed this interpleader suit, alleging that it was threatened with multiple liability and asking the district court to determine which of the two awards was enforceable against it. The gist of the complaint by Home Indemnity was that due process and the full faith and credit clause protected Home Indemnity from liability on more than one of the state awards.

In response to a motion by the claimant-defendants, the district court dismissed the interpleader action for lack of subject matter jurisdiction, citing the provision in 28 U.S.C. § 1445(c) barring removal from a state court to a federal court of a civil action arising under the workmen’s compensation laws of that state. As an alternative ground for dismissal, the court observed that the parties could raise the very issues underlying the interpleader complaint in the respective state courts in the course of appealing the two workmen’s compensation commission awards. Home Indemnity appeals the dismissal of the suit.

Initially, we consider whether the district court was correct in holding that it was without jurisdiction because of 28 U.S.C. § 1445(c). The Supreme Court in Horton v. Liberty Mutual Ins. Co., 367 U.S. 348, 81 S.Ct. 1570, 6 L.Ed.2d 890 (1961), established that § 1445(c) cannot be extended to cases beyond the scope of the plain wording of the statute. Thus the Court in Horton held that the. same evils § 1445(c) sought to eradicate were present in the filing of an original action in federal district court based upon the state workmen’s compensation law, but the wording of the statute indicated that only removal actions were barred and that original actions in federal court concerning such claims were still allowed. 367 U.S. at 352.

As in Horton, this court would be forced to ignore the plain language of § 1445(c) in order to uphold application of that section’s anti-removal provision to the case at bar. This follows because this suit does not possess the characteristics and effect of a removal action; the respective state courts retain jurisdiction to fully and finally adjudicate the workmen’s compensation claim before them.

Consequently, we conclude that the district court had jurisdiction under 28 U.S.C. § 1332 and Rule 22, since the parties agree that the sum in controversy exceeds $10,000 and the diversity requirement of Rule 22 is apparently met because all defendant-claimants are citizens of Arkansas and Home Indemnity, as the stakeholder, is incorporated and has its principal place of business in a state other than Arkansas. See 3A Moore’s Federal Practice ¶ 22.04 [2].

The claimants contend, however, that 28 U.S.C. § 1332(c) destroys diversity because assertedly Home Indemnity must be considered a citizen of Arkansas, since Mrs. Moore’s former employer is a citizen of that state. Section 1332(c), enacted in 1964, was primarily intended to eliminate the use of diversity jurisdiction to gain entry into the federal district court of Louisiana to sue in tort under that state’s direct action statute, which allows an injured party to sue directly the insurer of a tortfeasor without joining the tortfeasor himself as a defendant. See S.Rep. No. 1308, 88th Cong., 2d Sess., 1964 U.S.Code Cong. & Admin.News, p. 2778 et seq. But the Fifth Circuit in Hernandez v. Travelers Ins. Co., 489 F.2d 721 (5th Cir. 1974), recently ruled that the provision also applied when an employee sought to sue directly the workmen’s compensation insurer of his employer when employer and employee were citizens of the same state.

But § 1332(c) and the holding in Hernandez are inapposite to this inter-pleader action. Here we do not have a direct action against an insurer based upon tort or contract liability, but rather an interpleader suit by an insurer raising questions of full faith and credit. Indeed, no direct action statute is involved in any way. Section 1332(c) does not require on the facts of this ease that Home Indemnity be considered a citizen of Arkansas for purposes of diversity jurisdiction. Cf. Horton v. Liberty Mutual Ins. Co., supra; 3A Moore’s Federal Practice ¶ 22.04 [2], at 3015-17 n. 7 (1966).

Although the court erroneously held it lacked jurisdiction, we affirm the action of the court on the basis of the suggested alternative ground for dismissal; namely, that the court was not required to grant interpleader relief when the issues framed by the complaint could be adequately considered and resolved in the course of the state court proceedings already pending in Arkansas and Texas.

Interpleader is an equitable remedy. See, e. g., Texas v. Florida, 306 U.S. 398, 59 S.Ct. 563, 83 L.Ed. 817 (1939); Koehring Co. v. Hyde Const. Co., 424 F.2d 1200 (7th Cir. 1970); Great American Insur. Co. v. Bank of Bellevue, 366 F.2d 289 (8th Cir. 1966). And many courts have conditioned the grant of interpleader relief upon basic equitable doctrines. See generally 3A Moore’s Federal Practice ¶[ 22.16 [1]; 7 Wright & Miller, Federal Practice & Procedure § 1709.

Thus courts have declined to grant interpleader relief, or have stayed consideration of a request for such relief, when litigation in another court may obviate the need for the equitable remedy of federal interpleader. See, e. g., Koehring Co. v. Hyde Const. Co., supra; B. J. Van Ingen & Co. v. Connolly, 225 F.2d 740 (3d Cir. 1955); Equitable Life Assur. Soc. v. Cooper, 328 F.Supp. 1126 (W.D.Okl.1971); Consolidation Coal Co. v. Bailey, 308 F.Supp. 1251 (N.D.W.Va.1970); Flanagan v. Marvel, 94 F.Supp. 145 (D.Minn.1950), appeal dismissed, 189 F.2d 966 (8th Cir. 1951). See also Humble Oil & Ref. Co. v. Copeland, 398 F.2d 364 (4th Cir. 1968).

See also 7 Wright & Miller, Federal Practice & Procedure § 1709, at 396:

Finally, a court may dismiss or stay an interpleader proceeding if an action already pending before another court might obviate the need for employing the interpleader remedy or eliminate the threat of multiple vexation.' This certainly would be the case if the disputed issues are likely to be resolved in the other proceeding.

In the controversy presently before us, it is apparent that Home Indemnity will have the opportunity to raise the matter of full faith and credit in the pending state court proceedings. Once a final judgment has been rendered on either the Arkansas or the Texas workmen’s compensation claim and award, Home Indemnity will be able to assert in the appropriate state forum that it is protected from further liability by the full faith and credit clause — precisely the same contention it has sought to raise by this interpleader action. As the district court observed, there is no reason to assume that either the Texas or the Arkansas judiciary cannot and will not fully resolve the full faith and credit issue in light of the teachings of Magnolia Petroleum Co. v. Hunt, 320 U.S. 430, 64 S.Ct. 208, 88 L.Ed. 149 (1943); Industrial Comm. v. McCartin, 330 U.S. 622, 67 S.Ct. 886, 91 L.Ed. 1140 (1947); and other relevant cases.

In summary, we hold that the court properly declined to exercise its jurisdiction on the equitable ground that the parties’ rights can be fully and fairly litigated in the state courts.

ON PETITION FOR REHEARING

PER CURIAM.

In its petition for rehearing Home Indemnity asserts, inter alia, that our opinion in this case considerably narrows the right of a stakeholder to seek relief from multiple litigation by the use of interpleader. Such is not the case.

Initially, it should be noted that we affirmed the action of the district court upon a narrow equitable ground; namely, that an adequate remedy existed in another court of law, obviating the need for federal interpleader relief. Consequently, our opinion cannot be read as a general grant of authority to the district court to deny interpleader on the basis of a broad spectrum of grounds.

Since an equitable determination of adequacy of judicial relief should also entail a consideration of the financial and logistical burden and feasibility of requiring the parties to resolve the litigation in another court, by our opinion the district court may only decline to allow interpleader if the stakeholder in the potential interpleader suit will not thereby be denied meaningful or reasonable redress. It is therefore apparent that our opinion in this case recognizes only a limited exercise of discretion by the district court, and in no way can be considered to overturn the general right to interpleader relief when appropriate.

The petition for rehearing is denied.

      . The two state courts before which the respective appeals were pending agreed to stay further action on the appeals pending resolution of the federal interpleader litigation.

      . 28 U.S.C. § 1332(c) states in part:
      That in any direct action against the insurer of a policy or contract of liability insurance, whether incorporated or unincorporated, to which action the insured is not joined as a party-defendant, such insurer shall be deemed a citizen of the State of which the insured is a citizen, as well as of any State by which the insurer has been incorporated and of the State where it has its principal place of business.

      . In light of our ruling on the alternative grounds for dismissal, we need not consider whether the controversy between the stakeholder and claimants possesses those characteristics necessary in order for interpleader to be invoked as an appropriate remedy. Of. Moore’s Federal Practice ¶ 22.14 [1]-[3].


author: STEPHENSON, Circuit Judge.

text:
    Angela RATNAYAKE and the Town and Country Montessori School, Appellants, v. Anita MACK, Regional Certifying Officer, Manpower Administration, U. S. Department of Labor, Appellee. Chandrika JAYASEKERA and the Highland Park Montessori School, Appellants, v. Anita MACK, Regional Certifying Officer, Manpower Administration, U. S. Department of Labor, Appellee.
    Nos. 73-1865, 73-1866.
    United States Court of Appeals, Eighth. Circuit.
    Submitted March 14, 1974.
    Decided June 12, 1974.
    Rehearings and Rehearings En Baric Denied Aug. 13, 1974.

      John F. Niemeyer, W. St. Paul, Minn., for appellants.
    Stephen G. Palmer, Asst. U. S. Atty., Minneapolis, Minn., and Richard J. Fiore, Atty. Dept, of Labor, Washington, D. C., for appellee.
    Before GIBSON, BRIGHT and STEPHENSON, Circuit Judges.
   STEPHENSON, Circuit Judge.

The issues to be resolved on this appeal are whether the district court had jurisdiction to review the Secretary of Labor’s denial of labor certification under 8 U.S.C. § 1182(a) (14) (1970) and, if so, did the Secretary abuse his discretion in denying certification in this case.

Appellants Ratnayake and Jayasekera are alien Montessori school teachers who have entered the United States from Ceylon as temporary non-immigrant exchange visitors pursuant to 22 U.S.C. § 2451 et seq. (Supp.1974). During this period, appellant Ratnayake taught at appellant Town and Country Montessori School in Richfield, Minnesota. Appellant Jayasekera was employed by appellant Highland Park Montessori School located in St. Paul, Minnesota. Appellant schools subsequently decided to attempt to retain appellant teachers beyond the two-year period that they were then allowed to stay under the exchange-visitor program. In order to obtain immigrant visas for permanent residence, the schools were required to file, on behalf of appellant teachers, a request for a sixth preference visa from the Attorney General. 8 U.S.C. § 1153(a)(6) (1970). This visa is granted to certain qualified immigrants who desire to perform skilled or unskilled labor for which a shortage of “employable and willing persons exists in the United States.” The Attorney General is unable to issue the sixth preference visa until he receives a proper labor certification from the Secretary of Labor. Certification is not to be granted unless the Secretary finds that:

(A) there are not sufficient workers in the United States who are able, willing, qualified, and available at the time of application for a visa and admission to the United States and at the place to which the alien is destined to perform such skilled or unskilled labor, and (B) the employment of such aliens will not adversely affect the wages and working conditions of the workers in the United States similarly employed. * * * 8 U.S.C. § 1182(a)(14) (1970).

Appellants filed all of the certification application forms that are required by-29 C.F.R. § 60.1 et seq. (1973). Appellant teachers were informed of the denial of labor certification by the receipt of a form letter from appellee which contained merely a mark beside a sentence specifying that “United States workers are available for this occupation.” In addition, appellant Jayasekera was denied certification because it was asserted that her wage offer was below the prevailing wage scale.

Appellants commenced this suit requesting that the certification denials be set aside. The trial court, after a hearing, remanded the matter to the Secretary of Labor for further documentation and amplification of the basis for appellee’s determination. The Secretary reaffirmed the certification denials and submitted additional material to support his conclusion. The trial court, after reviewing this material, granted appellee’s motion for summary judgment. 365 F.Supp. 954 (D.Minn.1973). This appeal followed.

Our initial inquiry is whether the trial court properly concluded that it had jurisdiction of the case. Although the Immigration and Naturalization Act fails to explicitly provide for judicial review of the Secretary of Labor’s denial of labor certification, this does not indicate that judicial review of that determination was intended to be unavailable. Association of Data Processing Service Org., Inc. v. Camp, 397 U.S. 150, 156-157, 90 S.Ct. 827, 25 L.Ed.2d 184 (1970). Judicial review may still be available pursuant to section 10 of the Administrative Procedure Act, 5 U.S.C. § 701 (1967), which provides that such review is available except to the extent that:

(1) statutes preclude judicial review; or
(2) agency action is committed to agency discretion by law.

Appellee alleges that the latter exclusion is applicable to the present case in that the Secretary of Labor has been statutorily vested with the discretionary power to grant or deny labor certification under section 1182(a) (14), and thus his decision is not judicially reviewable. Based upon recent decisional law, as well as the import and application of section 1182(a)(14), we cannot agree.

It must be recognized at the outset that judicial review is the rule, not the exception, and nonreviewability is “not lightly to be inferred.” Barlow v. Collins, 397 U.S. 159, 166, 90 S.Ct. 832, 25 L.Ed.2d 192 (1970). In Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971), the Court stated that the preclusion of judicial review for action committed to agency discretion by law is “a very narrow exception.” Id. at 410. Judicial review should be disallowed only in those “rare instances” where the “statutes are drawn in such broad terms that in a given case there is no law to apply.” Id. at 410, quoting from S.Rep. No. 752, 79th Cong., 1st Sess. 26 (1945).

In Overton Park, the Secretary of Transportation was required by the Department of Transportation Act and the Federal-Aid Highway Act to disapprove any highway plan affecting public parkland unless it was shown that no alternate plan was feasible and all harm to the park was minimized. The Court held that there was plainly “law to apply” because the Secretary was required by statute to consider factors such as cost, disruptive effect in the area and directness of route in making his determination. Therefore, judicial review of his decision was available.

In 8 U.S.C. § 1182(a) (14), the Secretary of Labor is required to ascertain the status of the labor market in a particular occupation, the number of American workers willing and able to work, the extent to which such workers are available and qualified for a particular job, and the prevailing wage scale for workers similarly situated. These factors must all be considered when the Secretary is preparing to rule upon a labor certification application. As in the Overton Park case there is obviously “law to apply" under these circumstances, and thus the Secretary’s determination is not “committed to agency discretion by law.” We hold that the trial court properly assumed jurisdiction of this case. Our conclusion is supported by similar holdings of the First, Fifth and Seventh Circuits. They have recently held that the Secretary’s denial of labor certification is judicially reviewable under similar circumstances. Digilab, Inc. v. Secretary of Labor, 495 F.2d 323 (CA1 filed March 22, 1974); Reddy, Inc. v. United States Department of Labor, 492 F.2d 538 (CA5 filed April 10, 1974); Secretary of Labor v. Farino, 490 F.2d 885 (CA7 1973). See also, Mendez v. Major, 340 F.2d 128 (CA8 1965).

The determination reached by the Secretary is not to be set aside unless it is found to be “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2) (A) (1967). The trial court’s “inquiry into the facts [before the Secretary] is to be searching and careful” and it must overturn the findings and conclusions of the Secretary if they are not “based on a consideration of the relevant factors and * * * there has been a clear error of judgment.” Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 416, 91 S.Ct. 814, 824, 28 L.Ed.2d 136 (1971); accord Secretary of Labor v. Farino, 490 F.2d 885, 889-890 (CA7 1973).

Appellant teachers, natives of Ceylon, have been trained in the Montessori method at a Ceylon training center which operates under the auspices of the Association Montessori Internationale (A.M.I.). At the conclusion of the two-year training program, each was certified by the A. M. I.

Appellant schools, both of which are affiliated with A. M. I., have made a policy decision that A. M. I. certified teachers are better trained and qualified, and thus can conduct Montessori classes more effectively. Therefore, both schools have concluded that preference will be given to A. M. I. certified teacher applicants when a teaching vacancy arises. Due to the pronounced shortage of American A. M. I. certified teachers, appellant schools were forced to offer employment to aliens, such as appellants Ratnayake and Jayasekera, who had received their A. M. I. certification in foreign countries.

The reasons posited by the Secretary for denying labor certification to appellant teachers were that there is a surplusage of unemployed and underemployed college-educated American teachers; that these American teachers could, with a minimum of training, perform the employment functions that appellant teachers had applied for; that the job requirements established by appellant schools were unreasonable and unduly restrictive; and that disregarding the unreasonable job requirements, there were sufficient American teachers who were able, willing, qualified and available for the jobs.

In comparing the Montessori method with the more traditional method of education, there are obvious dissimilarities. Since each takes a different approach to education, the training and skills of a teacher for one is not necessarily compatible with those needed and utilized in the other. Mr. S. P. Marland, Jr., a former United States Commissioner of Education, characterized a Montessori teacher as follows:

[S]uch a person is a specialist in the Montessori approach to child development “with a detailed knowledge of Montessori psychology and theory.” This includes background in the use of certain materials which aid in the development of cognitive skills along with physical and emotional development. The heavy emphasis on use of materials is one of the chief differences between Montessori-trained teachers and conventionally-trained American teachers.

Mr. Marland’s successor as United States Commissioner of Education acknowledged that the lengthy and extensive training period required for A. M. I. certification was “reasonable” since the Montessori method “is different from the traditional American approach.”

In reviewing the job requirements established by appellant schools, the mere fact that the prerequisite for employment is a lengthy and extensive training period does not automatically give the Secretary the power to disregard them as unreasonable. There must be some deference accorded employment qualifications for “[e]very employer is entitled to hire persons who have qualifications that can be utilized in a manner that will contribute to the efficiency and quality of the business.” Acupuncture Center of Washington v. Brennan, 364 F.Supp. 1038, 1042 (D.D.C.1973). In Acupuncture Center, the court held that it was not unreasonable for the employer to demand that applicants speak three dialects of Chinese as well as have an understanding of acupuncture terminology and science. The First Circuit has recently asserted that the Secretary “should hot have the privilege of determining the qualifications of any particular applicant for the job to be filled. Nor without proof, should he have the right to attack the good faith of an employer’s personnel procedures.” Digilab, Inc. v. Secretary of Labor, 495 F.2d 323, at 326 (CA1 filed March 22, 1974). The job requirements of an employer are not to be set aside if they are shown to be reasonable and tend to contribute to or enhance the efficiency and quality of the business.

Due to the unique and specialized approach to education adopted by Montessori schools, as well as the training necessary to learn the skills that will enable one to operate .effectively as a Montessori teacher, it is not unreasonable for a school to require applicants to have undergone an extensive and lengthy training program. The A. M. I. certification program, which often extends for two years, is not unnecessarily or unreasonably long. A Montessori school may validly conclude that a short training period (i. e., six weeks as suggested by the Secretary) is insufficient to teach an individual the' academic and practical aspects of the Montessori method. It is our view that a Montessori school may reasonably establish job qualifications that require all applicants to have the equivalent of training required by A. M. I. or A. M. S. training centers.

However, it appears that appellant schools’ job requirements are unreasonable to the extent that they consider only A. M. I. certified teachers and disregard all other applicants with comparable or superior training. If an American A. M. S. certified teacher has applied for the position, an alien with A. M. I. certification should not displace her merely because certification was obtained from different certifying bodies. While we recognize the right of an employer to establish reasonable training periods and educational requirements as a prerequisite to employment, applicants who satisfy these requirements should be given equal consideration.

We conclude that the Secretary of Labor did not abuse his discretion in determining on the record available that the requirement that applicants at appellant schools must have A.M.I. certification was an unreasonable and unduly restrictive job requirement. However, we reverse because we fail to find that the Secretary fulfilled his duty under the labor certification provisions. The Secretary has the duty to determine whether there are sufficient American workers who are able, willing, qualified and available to perform the job that the alien has applied for. The Secretary relies heavily upon the fact that there is a surplusage of unemployed and underemployed American teachers in the United States, and the Department of Labor files showed 22 elementary school teachers “available” in the St. Paul area.

Although recognizing the need for a Montessori teacher to have some degree of training, there was no showing on the record that these “available” teachers had received any training at all. Absent such a showing, the Secretary could not conclude that there were “qualified” American workers available in the area. Digilab, Inc. v. Secretary of Labor, 495 F.2d 323, at 326 (CA1 1974), First Girl, Inc. v. Regional Manpower Administrator, 361 F.Supp. 1339, 1340 (N.D.Ill.1973); Bitang v. Regional Manpower Administrator, 351 F.Supp. 1342, 1345 (N.D.Ill.1972).

Even assuming that a certain number of the “available” American teachers were “qualified,” there is no basis in the record to conclude that any of them were “willing” to teach in either of the appellant school systems. Acupuncture Center of Washington v. Brennan, 364 F.Supp. 1038, 1041 (D.D.C.1973); Golabek v. Regional Manpower Administration, 329 F.Supp. 892, 895 (E.D.Pa.1971).

It is therefore our view that the Secretary abused his discretion in denying appellant teachers’ requests for labor certification on the meager record then available. While a certain amount of deference should be given to the Secretary’s determination, the basis for his decision cannot rest upon mere “conclusory” statements. Digilab, Inc. v. Secretary of Labor, 495 F.2d 323, at 327 (CA1 filed March 22, 1974).

The Secretary also denied certification to appellant Jayasekera on the basis that her wage offer of $7,100 was below the prevailing wage of $7,800 for this occupation in the proposed area of employment. However, the $7,800 figure was derived from the starting salary of B.A. degreed public school teachers in Minneapolis. This was an inappropriate comparative standard. The Secretary must compare the proposed wage offer with the prevailing wage scale of other employees who perform the specific job applied for by the alien. Reddy, Inc. v. United States Department of Labor, 492 F.2d 538, at 545-546 (CA5 filed April 10, 1974); First Girl, Inc. v. Regional Manpower Administrator, 361 F.Supp. 1339, 1341 (N.D.Ill.1973). In Golabek v. Regional Manpower Administration, 329 F.Supp. 892, 895-96 (E.D.Pa.1971), it was held to be an abuse of discretion by the Secretary to compare the wage offer of an alien applicant to teach parochial school with the prevailing wale scale of public school teachers. In the instant case, appellant Jayasekera’s wage offer should have been'compared with other Montessori teachers conducting classes for preschool age children in the area of employment.

Based upon our holding that appellant schools may require adequate Montessori training as a prerequisite to employment, it is unnecessary for us to discuss the constitutional issues raised by appellants.

The trial court’s granting of appellee’s motion for summary judgment is reversed. The case is remanded to the district court with direction to remand to the Secretary of Labor for reconsideration of appellants’ applications in light of this opinion.

Affirmed in part, reversed and remanded.

      . The determination as to whether labor certification should be granted or not has been delegated by the Secretary of Labor to a Certifying Officer appointed by the Regional Manpower Administrator of the Manpower Administration of the Department of Labor. 29 C.F.R. § 60.4 (1973).

      . The Attorney General has delegated his powers and responsibilities in this area to the Commissioner of Immigration and Naturalization. 8 C.F.R. § 2.1 (1973).

      . A number of district courts have also held that judicial review is available upon the Secretary’s denial of labor certification. First Girl, Inc. v. Regional Manpower Administrator, 361 F.Supp. 1339, 1340 (N.D.Ill.1973); Wang v. Regional Manpower Administrator, 352 F.Supp. 260, 261 (N.D.Ill.1972); Bitang v. Regional Manpower Administrator, 351 F.Supp. 1342, 1344 (N.D.Ill.1972); Ozbirman v. Regional Manpower Administrator, 335 F.Supp. 467, 470-471 (S.D.N.Y.1971); Golabek v. Regional Manpower Administration, 329 F.Supp. 892, 894 (E.D.Pa.1971).
      Appellee relies on Braude v. Wirtz, 350 F.2d 702 (CA9 1965) and Cobb v. Murrell, 386 F.2d 947 (CA5 1967) in which those courts held that judicial review of the Secretary’s denial of labor certification was not available. However, those cases are distinguishable from the present case. In Braude and Cobb, the alien applicants were not parties to the law suit and were not actually present in the United States. The action was commenced on behalf of the aliens by their prospective employers. The Braude court stated that it was “unable to discover a case * * * wherein aliens in these oireumstanees have been granted judicial review.” Braude v. Wirtz, supra, 350 F.2d at 706 (emphasis added). The Fifth Circuit has recently limited the Gobi case to its specific facts while allowing judicial review by an alien who was a party to the action and a lawful resident of the United States, as are the appellants in the present case. Reddy, Inc. v. United States Department of Labor, 492 F.2d 538 (CA5 filed April 10, 1974).

      . The Montessori method of education originated in Italy and its growing acceptance is a recent phenomenon in the United States. The genesis of its current popularity was approximately ten years ago. This method emphasizes the need for the young child to be given sufficient freedom to learn from the environment and from the use of different materials in the classroom. It is a shift away from the “teacher-centered” approach adhered to in the traditional educational method, and encourages self-knowledge and self-discipline by the child. A number of the Montessori schools are affiliated with either the American Montessori Society (A.M.S.) or the Association Montessori Internationale (A.M.I.). Both the A.M.S. and the A.M.I. ' have established training centers which enable them to teach the Montessori method to prospective teachers and certify them at the conclusion of the training period. There have been twelve to fifteen Montessori training centers established in the United States in the past ten years, including one at St. Paul, Minnesota.

      . See note 4, supra.

      . Quotation from a letter dated June 26, 1972, from the Commissioner to the Assistant Secretary for Manpower, U. S. Department of Labor (part of the file certified by the government and filed herein).
      The Commissioner made the additional comment : “Without committing myself to the Montessori method, I would • admit that the demand for traditionally trained Montessori teachers exceeds the supply available in the United States.”

      . In a letter received by the Assistant Secretary of Manpower on November 7, 1972 (contained in official file), John Ottina, Acting U. S. Commissioner of Education, wrote:
      From wliat I know of the Montessori method, the AMI standards for certification of their schools, teachers, and teacher trainers are reasonable. Their approach is different from the traditional American approach, yet diversity in educational philosophy is a hallmark of American education.
      In the same letter, the Commissioner stated: There is no question in my mind that the shortage of Montessori teachers and trainers is critical, even more critical than the shortage of regular teachers in the field of early childhood education.

      . The record indicates that certain A.M.I. training centers take into consideration the preliminary education of their trainees. The curriculum may allow an individual with a B.A. degree or its equivalent to complete the training course in ten months. Individuals without a college degree will be required to undertake the two-year training period.

      . The occasion may arise where the training period equivalent to that now required by A.M.I. or A.M.S. may be adniinistered so inadequately that only ill-trained and unprepared Montessori teachers' are produced. The posture of this case does not require us. to resolve whether an employer must accept a “certified” teacher from such a training center. The record does not indicate whether there are training centers, other than A.M.I. and A.M.S., which require such an extensive training period.

      . While appellant schools preferred A.M.I. certified teachers, it does not appear that this was an absolute requirement. In oral argument before this 'court appellants’ counsel stated:
      We stipulated below that although the schools have imposed an AMI certification requirement because we felt that was the best there is, if we couldn’t get teachers meeting that standard we’d go down a step at least to find teachers whether they might be AMS certified teachers who would carry comparable credentials. It is not a case of our holding fast that it has to be AMI or nothing. We have indicated that we are trying to apply some sort of reasonable management judgment in how teachers should be selected and we certainly have no purpose to exclude any great number of Americans.