## Facts

- Amoco Oil Company owned a gasoline service station and dealt with a sublessor who sought to transfer the station’s operation to John and Albert Torcomian.
- The Torcomians took possession and operated the station for several months while the parties disputed whether Amoco had promised to accept them as franchisees and whether they satisfied Amoco’s qualifications.
- No executed written franchise agreement existed between Amoco and the Torcomians.
- Amoco sued asserting statutory and trademark-based claims and sought broad relief effectively removing the Torcomians from the station and barring their use or entry.
- The Torcomians answered and filed a compulsory counterclaim alleging fraud and breach of contract, seeking money damages and injunctive relief compelling Amoco to honor the alleged franchise arrangement.
- The district court treated the case as equitable, denied the Torcomians’ jury demand on both the complaint and counterclaim, and conducted a bench trial.
- After the bench trial, the district court entered judgment for Amoco on all issues; the Torcomians appealed based on the denial of a jury trial.

## Issues

1. Whether the Seventh Amendment required a jury trial where the pleadings and pretrial order reflected legal claims and remedies, including ejectment-type relief and a compulsory legal counterclaim for damages.
2. Whether any error in denying a jury trial was harmless because the case could have been removed from the jury by directed verdict.

## Decision

- The court of appeals held the district court erred in denying a jury trial.
- The court held the error was not harmless because factual disputes existed such that directed verdict was not proper on Amoco’s claims or the Torcomians’ counterclaim.
- The judgment was vacated and the case remanded for further proceedings consistent with the right to a jury trial on the legal components.

## Legal Principles

- The legal or equitable character of claims for Seventh Amendment purposes is determined from the pleadings, including the pretrial order, rather than from how the evidence develops at trial.
- An action seeking relief equivalent to ejectment is legal in nature and carries a right to jury trial.
- A plaintiff’s equitable main claim does not defeat the right to a jury trial on a defendant’s compulsory counterclaim seeking legal relief (such as money damages).
- Denial of a properly demanded jury trial is not harmless where the record presents triable fact disputes and the court could not properly have directed a verdict.

## Conclusion

The appellate court vacated and remanded because the pleadings revealed legal issues and remedies, including ejectment-type relief and a compulsory counterclaim for damages, requiring a jury trial under the Seventh Amendment; the bench-trial disposition could not be upheld as harmless error.


Amoco Oil Co. v. Torcomian, 722 F.2d 1099 (3d Cir. 1983)