Beacon Theatres, Inc. v. Westover
359 U.S. 500 (1959)

Annotate this Case

U.S. Supreme Court

Beacon Theatres, Inc. v. Westover, 359 U.S. 500 (1959)

Beacon Theatres, Inc. v. Westover

No. 45

Argued December 10, 1958

Decided May 25, 1959

359 U.S. 500

Syllabus

In anticipation of a suit by petitioner for treble damages under the Sherman and Clayton Acts, the prospective defendant brought suit against petitioner in a Federal District Court for a declaratory judgment which would have settled some of the key issues in such an antitrust suit, and prayed that the bringing of such a suit be enjoined pending outcome of the declaratory judgment litigation. Petitioner filed a counterclaim raising the issues which would have been raised in the antitrust suit for treble damages, and demanded a jury trial. Purporting to act in the exercise of its discretion under Rules 42(b) and 57 of the Federal Rules of Civil Procedure, the District Court ruled that it would try in equity, without a jury, the issues common to both proceedings before trying petitioner's counterclaim. The Court of Appeals held that the District Court had acted within the proper scope of its discretion, and it denied petitioner's application for a writ of mandamus requiring the District Court to set aside its ruling.

Held: the judgment of the Court of Appeals is reversed. Pp. 359 U. S. 501-511.

1. The District Court's finding that the complaint for declaratory relief presented basically equitable issues draws no support from the Declaratory Judgment Act, which specifically preserves the right to a jury trial for both parties. P. 359 U. S. 504.

2. If petitioner would have been entitled to a jury trial in a treble damage suit, he cannot be deprived of that right merely because the prospective defendant took advantage of the availability of declaratory relief to sue petitioner first. P. 359 U. S. 504.

3. Since the right to trial by jury applies to treble damage suits under the antitrust laws, and is an essential part of the congressional plan for making competition, rather than monopoly, the rule of trade, the antitrust issues raised in the declaratory judgment suit were essentially jury questions. P. 359 U. S. 504.

4. Assuming that the pleadings can be construed to support a request for an injunction against threats of lawsuits, and as alleging the kind of harassment by a multiplicity of lawsuits which would traditionally have justified equity in taking jurisdiction and settling

Page 359 U. S. 501

the case in one suit, nevertheless, under the Declaratory Judgment Act and the Federal Rules of Civil Procedure, neither claim can justify denying petitioner a trial by jury of all the issues in the antitrust controversy. Pp. 359 U. S. 506-511.

(a) Today, the existence of irreparable harm and inadequacy of legal remedies as a basis of injunctive relief must be determined not by precedents under discarded procedures, but in the light of the remedies now made available by the Declaratory Judgment Act and the Federal Rules of Civil Procedure. Pp. 359 U. S. 506-510.

(b) Viewed in this manner, the use of discretion by the District Court under Rule 42(b) to deprive petitioner of a full jury trial of the issues in the antitrust controversy cannot be justified. P. 359 U. S. 508.

5. Mandamus is available under the All Writs Act, 28 U.S.C. § 1651, to require jury trial where it has been improperly denied. P. 359 U. S. 511.

252 F.2d 864 reversed.

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Primary Holding

A legal claim must be tried before an equitable claim in order to preserve the right to a jury trial when a defendant raises a claim against a plaintiff that is based on the opposite type of claim from the original claim.

Facts

Through contracts with movie producers in San Bernardino, Fox had received the exclusive right to show films for a period of time during which all other theaters were prohibited from showing them. After it moved into the area, Beacon threatened to sue Fox and its distributors for damages based on what it saw as their violations of federal antitrust law. In response, Fox sought declaratory relief in federal court to the effect that it had not violated antitrust law, as well as an injunction preventing Beacon from brining an antitrust claim. Beacon soon filed a counter-claim against Fox based on the alleged antitrust violations.

The right to a jury trial applies only to legal actions rather than claims brought in equity. Beacon pointed out that it might be collaterally estopped from challenging the results of Fox's equitable claims in a trial on the legal issues if the equity claims were heard first. The district court agreed that Fox's claims were essentially equitable but disagreed that hearing them first would be improper. It ruled that Fox was entitled to have all of the equitable issues decided by a judge, including the request for an injunction, without violating the opponent's right to a jury trial even if legal rights are involved. Beacon responded by seeking a writ of mandamus.

Opinions

Majority

  • Hugo Lafayette Black (Author)
  • Earl Warren
  • Felix Frankfurter
  • William Orville Douglas
  • Tom C. Clark
  • William Joseph Brennan, Jr.

The prior determination of equitable claims may trump the right to a jury trial in a related legal action only when irreparable harm would be caused to the party bringing the equitable claims by not having its claims heard first. Legal remedies are adequate unless a subsequent legal action would undermine a party's right to having a fair adjudication even if the opportunity for a jury trial was provided. However, Fox would be able to raise the same arguments that it planned to use in pursuing its equitable claim against Beacon in its answer to Beacon's counterclaim. It alternately could raise them in its pursuit of declaratory relief, which is a legal action. Beacon should not be required to try part of its claims before a judge and part before a jury.

Dissent

  • Potter Stewart (Author)
  • John Marshall Harlan II
  • Charles Evans Whittaker

The issues covered by Fox's complaint could not all have been raised within the scope of a legal action. The right to a jury trial in the context of declaratory relief hinges on the specific circumstances. If Fox had succeeded in obtaining a declaratory judgment but not obtained an injunction, it might not have effectively been able to prevent Beacon from interfering with its business contracts. It was improper to force Fox to respond to Beacon's later claims before bringing its own case.

Case Commentary

The two claims shared a common element regarding the grand of clearances, but the antitrust claim was a legal rather than equitable claim, and thus it could be heard by a jury. One party cannot force the other party to accept equitable remedies by introducing equitable elements into its opposing claim.

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