Shida v. Japan Food Corp.

FILES, P. J.

This is an action for damages for unfair competition, between two competing distributors of Japanese food products. The gravamen of the complaint is that, in 1959, defendant induced the manufacturer of Ko-Ko brand takuwan to discontinue business with plaintiff and deal with defendant exclusively thereafter.

Takuwan is a pickled turnip or radish which is a common item of Japanese food. Prior to 1952 it was being imported into California from Japan packed in wooden tubs and small cans, but there was no market in the United States for talcu

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wan of Hawaiian origin. In February 1952, Waimanalo Ko-Ko Company, of Hawaii, arranged with plaintiff (who does business under the name of Star Rice Company) to undertake the distribution of Ko-Ko brand takuwan, which is made in Hawaii and packed in glass jars. This arrangement was evidenced by a writing, the full text of which is: “We hereby agree to give Star Rice Company of 204 So. San Pedro St, Los Angeles, California the exclusive rights of distributing the Waimanalo Ko-Ko pickled turnips on the mainland from February 11,1952, to February 11,1953.

‘' Waimanalo Ko-Ko Co.

[Signed] Richard K. Kiyota”

Each year thereafter, through 1958, a similar writing was executed. The last such contract was in this form: “The Waimanalo Ko-Ko Co. gives Star Rice Co. the exclusive right to distribute the Ko-Ko brand Pickled Radish on the mainland from Jan 28, 1958 to Jan. 28,1959.

'‘WaimanaloKo-Ko Co.

[Signed] R. Kiyota

R. Kiyota”

During the period from 1952 to 1958 plaintiff was successful in marketing the product. Gross sales by Waimanalo to plaintiff grew from $8,650 in 1952 to approximately $40,000 in 1958.

Defendant was organized in 1958 as a merger of three companies engaged in the business of importing and distributing Japanese food. Early in 1958 a representative of one of the merging companies visited Hawaii and urged Waimanalo to distribute its takuwan through the defendant company. As a result of this inducement, Waimanalo declined to renew its agreement with plaintiff in 1959. On February 4, 1959, Waimanalo Ko-Ko Company entered into an exclusive distributorship agreement with defendant, effective March 1,1959.