Al-Khaldiya Electronics and Elec. Equip. Co. v. Boeing
| Decision Date | 07 July 2009 |
| Docket Number | No. 08-2686.,08-2686. |
| Parties | AL-KHALDIYA ELECTRONICS AND ELECTRICAL EQUIPMENT CO., W.L.L., Appellant, v. THE BOEING COMPANY; Boeing Global Sales Corporation; McDonnell Douglas Services; McDonnell Douglas Corporation; McDonnell Douglas Helicopter Corporation, Appellees. |
| Court | U.S. Court of Appeals — Eighth Circuit |
David S. Evinger, argued, Minneapolis, MN, Robert J. Gilbertson, Terrence R. Joy, Daniel W. Berglund, Minneapolis, MN, Gerard T. Noce, St. Louis, MO, on the brief, for appellant.
Charles A. Weiss, argued, Stephen Snodgrass, Gabriel E. Gore, on the brief, St. Louis, MO, for appellees.
Before GRUENDER, ARNOLD, and BENTON, Circuit Judges.
Al-Khaldiya Electronics and Electrical Equipment Co. sued The Boeing Company and its subsidiaries for alleged contract breaches. The district court1 granted summary judgment to Boeing. Al-Khaldiya appeals. Having jurisdiction under 28 U.S.C. § 1291, this court affirms.
This case involves a Boeing subsidiary, McDonnell Douglas Corporation (MDC), and its subsidiaries—Boeing Global Sales Corporation (formerly McDonnell Douglas International Sales Corporation) (MDISCO); McDonnell Douglas Services (MDS); and, McDonnell Douglas Helicopter Company.
In 1996, Al-Khaldiya and MDISCO entered into a representation agreement for January 22, 1996, to January 21, 1998. According to this 1996 agreement, Al-Khaldiya was to solicit and promote sales or leases of McDonnell Douglas products. As amended, the 1996 agreement tied compensation to the successful sale of AH-64 Apache helicopters. It also stated that Al-Khaldiya would be paid $100,000 for the successful sale and transfer of A-4 aircraft from the government of Kuwait to a party other than MDC. During the term of the 1996 agreement, Al-Khaldiya promoted Apache helicopters to Kuwait, but none was sold.
Sales of major military equipment by the U.S. to Kuwait are conducted between governments rather than as direct commercial sales. See 22 U.S.C. §§ 2751-2796d. Foreign Military Sales (FMS) procedures require that Kuwait express interest in an item by sending a Letter of Request (LOR) to the U.S. If the U.S. is willing to sell the item, it sends an offer in a Letter of Offer and Acceptance (LOA), which Kuwait may sign. The U.S. may then either procure the item from the manufacturer and resell it to Kuwait, or fill the order from inventory.
In 1996, Kuwait asked the U.S. Embassy to provide an LOA for 16 Apache helicopters, including 6 with Longbow Fire Control Radar. The U.S. issued an LOA for the helicopters, but without Longbow radar. Kuwait did not sign the LOA. Meanwhile, Al-Khaldiya facilitated the sale of the A-4 aircraft from Kuwait to Brazil.
In May 1998, Al-Khaldiya and MDISCO signed a new representation agreement, for June 18, 1998, to June 17, 2000. In 1999, the U.S. notified Kuwait that it authorized the release of the Longbow radar. Kuwait submitted an LOR for Apache helicopters in 2001 and signed an LOA in 2002. The U.S. purchased Apaches for Kuwait from McDonnell Douglas Helicopter Company in December 2002, after both representation agreements had expired.
On January 26, 2000, Al-Khaldiya and MDS entered a joint-venture agreement (JVA) to engage in the provision of Contractor Maintenance Support (CMS) for the F/A-18 aircraft, and/or the AH-64 Apache helicopter. The JVA was terminable by either party upon written notice to the other if "a notice of award with respect to the Program(s) [was] not received by the Company prior to 31 December, 2000" or "[t]he Contract(s) [were] determined finally to be awarded to a third party or parties on any basis."
The MDS proposal for F/A-18 CMS services was rejected by the U.S. Navy in March 2000. The Navy awarded the CMS contract to another contractor. MDS sent Al-Khaldiya a letter on June 5, 2000, terminating the JVA.
This court reviews a district court's grant of summary judgment de novo, viewing the evidence in the light most favorable to the non-moving party. Hartford Fire Ins. Co. v. Clark, 562 F.3d 943, 945 (8th Cir.2009). The parties agree that this case is governed by Missouri law. Under Missouri law, summary judgment in a contract case is appropriate only where the contract language is so clear and unambiguous that the contract's meaning is readily apparent from the face of the document itself. Baum v. Helget Gas Products, Inc., 440 F.3d 1019, 1022 (8th Cir. 2006).
Al-Khaldiya asserts that Boeing breached the 1996 agreement, by not paying it a commission for the Apache helicopter sale. Boeing counters that Article 3.3 of the agreement bars Al-Khaldiya's claim. Article 3.3 states:
In the event this Agreement is discontinued by termination for convenience under ARTICLE 7 hereof prior to the end of the term of this Agreement or by expiration, Representative's right to receive commission payments, if any, which are agreed to by the parties as set forth in the Exhibit(s) hereto in connection with sales or leases of the Products pursuant to orders accepted by MDC or MDISCO within thirty (30) days after notice of termination is given, as provided in Articles 7 and 9, or within thirty (30) days after expiration shall not be affected, but thereafter Representative shall not under any circumstances be entitled to any commission for any order received from any purchaser of the Products even if said order was procured through Representative's direct selling efforts. MDISCO shall have no further financial obligations to Representative beyond the date of such termination or expiration. [emphasis added]
Al-Khaldiya argues that Article 3.3 pertains only to direct, non-FMS sales—not the Apache FMS sale. Al-Khaldiya relies on the following language in Article 3.3:
[1] "orders accepted by MDC or MDISCO"
[2] "order received from any purchaser ... even if said order was procured through [Al-Khaldiya]'s direct selling efforts."
Al-Khaldiya says that the representation agreement's scope is limited to sales to purchasers in Kuwait. However, the purchaser of "orders accepted by MDC or MDISCO" in an FMS sale must be the U.S. government, and MDC and MDISCO cannot "accept" an FMS order from Kuwait. Al-Khaldiya interprets "direct selling efforts" to mean direct, non-FMS sales, so the purchaser of an order "procured through [Al-Khaldiya]'s direct selling efforts" must be Kuwait. Al-Khaldiya argues, therefore, since the purchaser of the order in phrase [1] is not the same as the purchaser of the order in phrase [2], "order" is not given a consistent meaning throughout Article 3.3 if it is applied to the Apache FMS sale.
This court disagrees. Contract terms are read as a whole and given their plain, ordinary, and usual meaning. Dunn Indus. Group, Inc. v. City of Sugar Creek, 112 S.W.3d 421, 428 (Mo. banc 2003). The provision's plain language does not require the purchaser in phrase [2] to be the government of Kuwait. The provision applies to "any purchaser." The "direct selling efforts" language does not limit the provision to non-FMS sales. Further, Article 3.3 adopts the agreement's Exhibits. All versions of Exhibit A provide for commissions on FMS sales. Therefore, Article 3.3 bars Al-Khaldiya's claim to a commission for the FMS sale of Apache helicopters.
Al-Khaldiya invokes Mathews v. Knoll Assoc., Inc., 388 S.W.2d 529, 533 (Mo.Ct. App.1965) as a similar case that rejected the argument that a contract's sunset provision defeated a saleswoman's claim for commissions. There, the court found that the sunset provision did not bar commissions on sales made before (but shipped after) the termination of the contract. Id. Here, the Apache sale was not made until after termination of the 1996 agreement, so Mathews is inapposite.
Al-Khaldiya claims that its A-4 aircraft claim is not time-barred because Boeing timely renewed its...
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