Blue Sky 1, LLC v. Jaguar Land Rover N. Am., LLC
| Decision Date | 16 November 2016 |
| Docket Number | Civil No. 16-207 (ES) (SCM) |
| Parties | BLUE SKY 1, LLC, Plaintiff, v. JAGUAR LAND ROVER NORTH AMERICA, LLC, Defendant. |
| Court | U.S. District Court — District of New Jersey |
NOT FOR PUBLICATION
Pending before the Court is a Motion to Dismiss filed by Defendant Jaguar Land Rover North America, LLC ("Jaguar"). (D.E. No. 5). Plaintiff Blue Sky 1, LLC ("Blue Sky") filed opposition, (D.E. No. 7), and Jaguar filed a reply, (D.E. No. 8). The Court decides Jaguar's Motion without oral argument, see Fed. R. Civ. P. 78(b), and, for the following reasons, GRANTS Jaguar's Motion.
In 2013, Thomas Maoli sought to purchase the assets of Morris County Jaguar, LLC, d/b/a Madison Jaguar ("Madison"), which was a franchised dealership of Jaguar, a company that manufactures and sells motor vehicles. . Madison sold and serviced Jaguar's manufactured motor vehicles. (Id. ¶ 7).
On or about September 4 or 5, 2013, Maoli reached an agreement with Blue Sky (the "Consultant Agreement"), wherein Blue Sky would help to effect the sale of Madison's assets to Maoli and/or his affiliated entities. .1 The Consultant Agreement provides that its "purpose . . . is to set forth the terms and conditions under which Blue Sky 1, LLC . . . agrees to serve Thomas Maoli and/or its [sic] other affiliated entities (collectively called 'Client') as a consultant and the sole and exclusive intermediary to effect the acquisition of the business of Madison Jaguar, Madison, NJ." (Consultant Agreement at 1, D.E. No. 1-2, ECF p. 16). Further, the Consultant Agreement provides that Blue Sky would provide its Client the following "Services": "Blue Sky 1 shall use its best efforts to introduce Target Acquisitions to Client, to advise on deal structure, to assist in the negotiation of the acquisitions and the performance of due diligence, and to assist in the closing of the acquisitions." (Id. ¶ 3).
And, another paragraph of the Consultant Agreement states that Maoli or his affiliated entity—i.e. the Client—would pay Blue Sky a "Success Fee" if Maoli or his affiliated entity purchased Madison. (See id. ¶ 5). That provision states, in full, as follows:
Success Fee. In the event of any purchase of Madison Jaguar, by Client during the term of this Agreement, or within twelve months following termination of this Agreement, Client agrees to pay Blue Sky 1 at the closing of such Purchase a fee ("Success Fee") based upon the total consideration to be paid by Client and received directly or indirectly by Target Acquisitions as a result of the Purchase, including but not limited to, cash, cash equivalents, promissory notes, liabilities assumed by the Client, business assets to be retained by Target Acquisitions (in the form of cash, accounts receivable, inventory (not on parts & new or used cars) or equipment, purchase price allocated to employment agreements, non-competition agreements, consulting agreements, management agreements and capital stock or any other securities received in exchange for Target Acquisitions business, assets or any portion thereof ("Consideration"). The Success Fee shall be in amount equal to ten percent (10%) of the Consideration paid by Client and received by TargetAcquisitions in connection with the Purchase. The Success Fee as calculated above shall be paid in full at closing in cash, by certified check or official bank check, or by wire transfer.
(Id.; see also Compl. ¶ 9). "Client" is defined under the Consultant Agreement as "Thomas Maoli and/or [his] other affiliated entities." (See Consultant Agreement at 1, D.E. No. 1-2, ECF p. 16). "Purchase" is defined as "[t]he purchase or other acquisition of the business of Target Acquisitions or any portion thereof." (Id. ¶ 1). The Consultant Agreement does not expressly define "Target Acquisitions." (See generally id.).
Additionally, the Consultant Agreement contains an "Entire Agreement" section, which states that (Id. ¶ 12).
Pursuant to the Consultant Agreement, Blue Sky negotiated the terms of an agreement whereby Celebrity Jaguar, LLC ("Celebrity"), an entity set up by Maoli for the purpose of purchasing Madison's assets, would purchase Madison's assets. (See Compl. ¶ 10). The terms of that agreement were memorialized in an Asset Purchase Agreement (the "APA"), which contains several provisions relevant to the Court's analysis of this Motion. .
First, the APA contains a "No Broker" Clause (the "NBC"), which provides as follows:
No Broker. Except for Blue Sky 1, LLC (Matthew J. Visconti, Jr.), the parties warrant and represent that neither have retained the services of a broker or salesperson in connection with the sale of the subject Premises and that there is no brokerage commission due in connection with this sale. The parties further warrant and represent to the other that it was not shown the subject Premises as a result of any efforts of a real estate broker or salesperson. Each party agrees to indemnify and hold harmless the other against and from any claims for any brokerage commissions and all costs, expenses, and liabilities in connection therewith,including, without limitation, attorneys' fees and expenses, arising out of any conversations or negotiations had by such party with any broker. BUYER shall be solely responsible for the fee owed Blue Sky 1, LLC, and such fee shall be paid at closing.
(Id. ¶ 11; APA ¶ 23, D.E. No. 1-3, ECF p. 8,). The NBC represents the APA's only mention of Blue Sky. "BUYER" is defined in the APA as "Celebrity Jaguar, LLC." (APA, D.E. No. 1-2, ECF p. 20).
Second, the APA contains a provision that outlines the parties' understanding as to what constitutes the parties' agreement:
This Agreement and all related documents executed concurrently herewith represent the complete understandings between the parties and their respective legal counsel, and supersede all previous negotiation or representations as to all matters whether described in said Agreement or not. This Agreement and all related documents executed concurrently herewith may be amended only be written instrument signed by both parties (or their respective legal counsel) and making express reference to the respective document to be amended.
(Id. ¶ 26(d), D.E. No. 1-3, ECF p. 10).
Third, the APA contains provisions recognizing certain rights of Jaguar. For example, Paragraph 26(s) states:
Options; Rights of First Refusal. Except for the right of the BUYER to acquire the Business pursuant to this Agreement, no other person or entity has any right to acquire all or any portion of the Business or the SELLER'S manufacturers' franchise rights or privileges other than [Jaguar] pursuant to the Dealership Agreement.
(Id. ¶ 26(s), D.E. No. 1-3, ECF p. 13).
Indeed, as the APA recognizes, Jaguar had certain rights pursuant to its Dealer Agreement with Madison, under which Madison sold Jaguar's motor vehicles. (Compl. ¶ 7). Among the various provisions of the Dealer Agreement is a provision restricting Madison's right to (1) "change [Madison's] ownership or management"; (2) "sell or otherwise transfer all or substantially all of the assets used in [Madison's] Jaguar operations"; or (3) "transfer any rights or obligationsunder such Dealer Agreement (any of the foregoing referred to herein as an 'Ownership Proposal')." .
A further Dealer Agreement provision grants Jaguar a "right of first refusal" ("ROFR") in the event Madison intended to implement any such Ownership Proposal. (Dealer Agr. Ex. Compl.; Perf. Agr., Ex. E - Jaguar Right of First Refusal to Purchase ("Def. ROFR")). The ROFR provides, in relevant part, that:
.
Despite the apparent agreement between Madison and Celebrity regarding the sale of Madison's assets to Celebrity, Madison did not ultimately sell its assets to Celebrity, Maoli, or oneof Maoli's affiliated entities. (...
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