Arnold Alford, Plaintiff-appellant, v. Frontier Enterprises, Inc., D/b/a Frontier Petroleum Companyand Arthur D. Katzenberg, Jr., Defendants-appellees, 599 F.2d 483 (1st Cir. 1979)

Plaintiff Alford brought suit against Frontier alleging violations of the Emergency Petroleum Allocation Act (EPAA) of 1973, 15 U.S.C. §§ 751 Et seq., tortious interference with contractual relationships, and anticompetitive business practices constituting an unreasonable restraint of trade. The complaint was later amended to add a fourth cause of action derived from the same operative facts and premised on a violation of Mass.Gen.Laws Ann. ch. 93A, § 11 (unfair and deceptive trade practices). Defendants moved to dismiss on the grounds that plaintiff lacked standing, had failed to exhaust administrative remedies, and had failed to state a claim upon which relief could be granted. The district court granted a hearing on defendant's motion, following which the action was dismissed. This appeal followed.

Plaintiff alleged that defendants, in violation of the EPAA and pertinent regulations, and in order to force plaintiff and a corporation of which plaintiff was principal stockholder, Prime Gasoline and Oil Company, Inc. (Prime), out of business, terminated gasoline supplies.

The EPAA became effective on November 27, 1973. Sometime prior to that time, defendant had supplied gasoline to Prime on a wholesale basis. Shortly before November 27, 1973, defendant ceased deliveries, allegedly because Prime was in debt to Frontier. Alford was owner of seven service stations which he leased to Prime, the corporate distributor of the gasoline which held the licenses to the seven stations. After Frontier stopped deliveries, Prime went into bankruptcy. A trustee in bankruptcy was appointed to liquidate Prime, paying all bills and collecting all monies due Prime.¹  The trustee has not joined in this action. Frontier never had a business relationship with plaintiff. Its dealings were solely with Prime, the corporation.

We cannot help but observe at the outset that Alford is attempting to use the corporate form both as shield and sword at his will. On the one hand, the corporate form (I. e., Prime) effectively shielded Alford from liability; on the other hand, he now asserts that He operated the seven service stations through his vehicle, Prime. It is his position that, as the principal stockholder of Prime and lessor of the service stations it operated, he can disregard the corporate entity and recover damages for himself.²  Of course, this is impermissible. Ames v. American Telephone & Telegraph, 166 F. 820, 822 (1st Cir. 1909); Converse v. Hood, 149 Mass. 471, 21 N.E. 878 (1889); Caccavaro v. Kinkade & Co., Inc., 344 N.E.2d 421 (Mass.1976); Mass.Gen.Laws Ann. ch. 156B, §§ 9(b), 46.

(W)here the business or property allegedly interfered with by the forbidden practices is that being done and carried on by a corporation, it is that corporation alone, and not its stockholders (few or many), officers, directors, creditors or licensors, who has a right of recovery, even though in an economic sense real harm may well be sustained as the impact of such wrongful acts . . . .

Mendenhall v. Fleming Co., Inc., 504 F.2d 879, 881 (5th Cir. 1974), citing Martens v. Barrett, 245 F.2d 844, 846 (5th Cir. 1957).

Plaintiff relies on Perkins v. Standard Oil Co. of Cal., 395 U.S. 642, 89 S. Ct. 1871, 23 L. Ed. 2d 599 (1969), to rescue him from imposition of this longstanding and universally accepted rule. In Perkins, plaintiff had leased property to his closely held corporate distributors which then engaged in wholesale and retail distribution of gasoline. Perkins owned the retail outlets which he leased to his corporate distributors and brought suit against defendant oil company, claiming a violation of the Robinson-Patman Act, 15 U.S.C. § 13 (Section 2 of the Clayton Act). Though these facts present a superficial similarity to plaintiff's situation here, the crucial distinction not recited by plaintiff is that in Perkins the defendant oil company sold its gasoline directly to Perkins and billed Perkins. See Standard Oil Co. of Cal. v. Perkins, 396 F.2d 809, 811 (9th Cir. 1968), for discussion of uncontroverted facts of the case. Perkins' rights were personal, not derivative. No such disregard of the corporate entity obtained in the case before us. The district court correctly found Alford to lack standing to prosecute this claim on the grounds that the harm, if any, was sustained by the corporation Prime, and not by Alford.

Nor can plaintiff be understood to be a "non-branded independent marketer" of petroleum products under 15 U.S.C. § 752(2),³  entitled to the mandatory allocation of 15 U.S.C. § 753(c) (1).⁴  As indicated in our discussion above, the district court properly found that Alford was not a nonbranded independent marketer. The corporation Prime was the purchaser,10 C.F.R. § 210.62(a), and the marketer, 15 U.S.C. § 752(2).

Because we find that the district court rightly dismissed the claims due to lack of standing, we need not reach the other issues raised on appeal. Suffice it to say that none appears to offer plaintiff a wedge by which he can push open the door closed to him by virtue of his lack of standing to sue.

Affirmed.