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Palmieri v. MOBIL Oil Corp.
decided: May 27, 1982.
JOSEPH PALMIERI, PLAINTIFF-APPELLANT,
MOBIL OIL CORPORATION, DEFENDANT-APPELLEE
Appeal from an order of the United States District Court for the District of Connecticut, Clarie, C.J., denying appellant's application for a preliminary injunction preventing appellee from terminating appellant's service station franchise under the Petroleum Marketing Practices Act, 15 U.S.C. §§ 2801 et seq.
Lumbard, Moore and Meskill, Circuit Judges.
This is an expedited appeal from an order entered on January 8, 1982 by the United States District Court for the District of Connecticut, Clarie, C.J., which denied Joseph Palmieri's application for a preliminary injunction pursuant to the Petroleum Marketing Practices Act (PMPA), 15 U.S.C. §§ 2801 et seq. On February 9, 1982, we stayed Judge Clarie's order pending this appeal.
Palmieri operates a retail gasoline station in Southington, Connecticut. On November 30, 1981 Palmieri's latest franchise agreement with Mobil Oil Corporation expired. Mobil offered to renew the franchise under an agreement containing a new formula which would substantially increase Palmieri's monthly rent. When Palmieri refused to accept the proposed agreement, Mobil notified him that his franchise would not be renewed. Palmieri responded by bringing suit alleging that Mobil's failure to renew his franchise was arbitrary, discriminatory and in violation of the PMPA.
We agree with Judge Clarie's ruling that Palmieri failed to present evidence raising sufficiently serious questions with respect to Mobil's good faith and lack of discriminatory motive to warrant the issuance of a preliminary injunction under 15 U.S.C. § 2805. Section 2805(b) (2) provides in clear language that the franchisee bears the burden of showing that there exist "sufficiently serious questions going to the merits" to warrant the equitable relief of a preliminary injunction.*fn1 The record fully supports Judge Clarie's ruling that Palmieri failed to meet his burden.
We also agree with Judge Clarie that the PMPA does not require a franchisor to use objectively reasonable and economically realistic criteria in determining the amount of rent to be charged for a retail gasoline franchise; it merely prohibits a franchisor from applying a rental formula in a discriminatory manner in order to drive a franchisee out of the franchise relationship. Chief Judge Clarie thoroughly and correctly addressed this issue, and we affirm on the basis of his opinion, reported at 529 F. Supp. 506 (D. Conn. 1982).
Palmieri's remaining claims do not merit discussion.
Affirmed. The mandate shall issue forthwith.
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