Business Equipment Center, Ltd. v. DeJur-Amsco

• Decision Date: 21 February 1978
• Docket Number: Civ. A. No. 76-1680.
• Citation: 465 F. Supp. 775
• Parties: BUSINESS EQUIPMENT CENTER, LIMITED, Plaintiff, v. DeJUR-AMSCO CORPORATION, Defendant and Counterclaimant, v. Sidney W. ROSEN et al., Counterclaim Defendants.
• Court: U.S. District Court — District of Columbia

465 F. Supp. 775

BUSINESS EQUIPMENT CENTER, LIMITED, Plaintiff, v. DeJUR-AMSCO CORPORATION, Defendant and Counterclaimant, v. Sidney W. ROSEN et al., Counterclaim Defendants.

Civ. A. No. 76-1680.

United States District Court, District of Columbia.

February 21, 1978.

COPYRIGHT MATERIAL OMITTED

Edward L. Genn, Washington, D. C., for plaintiff and third-party defendant Rosen.

Jerome S. Wagshal, Washington, D. C., for defendant.

John Shorter, Jr., Washington, D. C., for third-party defendant BEC, Baltimore.

MEMORANDUM

GASCH, District Judge.

After numerous peripheral skirmishes that have taken their toll, both on the parties and the Court, defendant now attempts with this motion for summary judgment to take the offensive in an effort to inflict a fatal blow on plaintiff's case. Rather than counterattack, plaintiff has dug in, hoping that the blows will miss their mark, that the assault will fail, and that conditions for victory will be more advantageous at a later date. The facts and events leading to this battle as well as the blow-by-blow description of it are recited below.

BACKGROUND

Defendant DeJur-Amsco Corp. (DeJur) was an importer of dictation equipment,¹ and plaintiff Business Equipment Center, Ltd. (BEC), up to the time of this lawsuit, was the sole independent distributor of DeJur's equipment in the District of Columbia metropolitan area. This relationship was confirmed by contract until around 1974. BEC acknowledges, however, that no formal contract has existed since then.² In 1971 BEC also became the franchised dealer of Sony, whose dictating equipment is competitive with that of DeJur's. BEC alleges that its status as a DeJur dealer was to continue so long as it adequately and reasonably served DeJur's interests in the D.C. area. For purposes of this motion, DeJur does not dispute that.

Based on the affidavit of Mr. Steven Monk, DeJur's Vice President for Administration, and also on data from DeJur's business records attached as exhibits to that affidavit, it appears the BEC's purchases of DeJur machines, parts, and accessories declined steadily from $206,800 in 1969 to $8,275 during the first ten months of 1976. Considering new machine purchases only, the figures are $185,000 in 1969 and nothing in 1976. BEC's performance as a DeJur dealer not only declined in this absolute sense, but other information from the Monk affidavit also reveals a decline in DeJur's performance relative to the performance of all other DeJur dealers.³ BEC was fourth in sales in 1971, sixth in 1972 and 1973, twelfth in 1974, thirteenth in 1975, and at the bottom in 1976.⁴

Early in BEC's and DeJur's relationship, it was agreed that because of BEC's strategic position as the DeJur dealer in the District of Columbia area, it would get commissions on all sales to the federal government wherever made and whether or not made by BEC. In 1974 about 70 percent of these commissions were from BEC's own sales to the Government, but in 1975 virtually all the commissions came from sales by other dealers.⁵

DeJur contends that the reason for this decline in BEC's performance was the latter's decision to focus its efforts on sales of Sony equipment and further that as a result of this decision, BEC intentionally switched its DeJur customers to the Sony line. DeJur's evidence for this contention comes from various sources.

First, DeJur relies on the deposition of Mr. William Broderick, National Sales Manager of the Business Products Division of Sony from February, 1972, to February, 1975. He testified at his deposition that BEC was the top Sony dealer in the United States by almost $75,000 in sales during the year November, 1973, to October, 1974. He further stated that BEC consistently was one of the top three Sony dealers during his term as Sony National Sales Manager and that probably they were number one each of those years.⁶ DeJur argues that the obvious inference to be drawn from BEC's rise to the top as a Sony dealer coincidental with its fall to the bottom as a DeJur dealer is that BEC's customers were intentionally switched from DeJur to Sony equipment.

Two additional evidentiary items have been offered by DeJur to support that inference. The first is the testimony of Ms. Susan Ramsey, office manager of a District of Columbia law firm, that in September, 1976, BEC attempted to switch her firm from its DeJur equipment even though they were satisfied with it.⁷ The second is a copy of a letter written in 1972 by Mr. Sidney Rosen, President and principal stockholder of BEC, and sent to the University of Maryland.⁸ In that letter, Mr. Rosen referred to the universal cassette, an item of dictating equipment sold by Sony but not by DeJur, and then he wrote:

From my end, I took my gamble in putting all my chips in that direction by investing in the future of Sony's equipment.

Letter from Sidney W. Rosen to Mr. Friedman of the University of Maryland at Baltimore (Mar. 1, 1972).

In March and in April of 1976 two DeJur representatives met with Mr. Rosen and told him that DeJur no longer wished to do business with BEC. BEC alleges that thereafter DeJur refused to deal with it, but DeJur's evidence shows sales to BEC of over $8,000 in parts and accessories though no sales of new machines were made.⁹ Mr. Rosen acknowledged these sales in his deposition.¹⁰

Prior to these meetings with Rosen in the spring of 1976, DeJur hired Mr. Roy Witte and Mr. Phillip Vertin to work on improving its sales picture. At some point during this time frame, precisely when being unclear, DeJur also established at least two other dealers in the District of Columbia area, Rockville Office Machines and Washington Office Products. BEC believes a conspiracy exists among DeJur, these two new employees, and the two new dealers to undermine BEC's government sales and its business generally and then to take it over. Accordingly, BEC filed this suit in September, 1976. In November, 1976, DeJur by letter formally terminated BEC as a franchised or authorized dealer of DeJur products.¹¹

BEC's complaint alleges that DeJur: breached their agreement by terminating BEC's dealership without cause or notice; conspired in violation of the antitrust laws; made fraudulent misrepresentations to BEC; and interfered with BEC's business relations and engaged in unfair competition. DeJur has counterclaimed, but it is not now before the Court as DeJur's motion only asks for summary judgment with respect to BEC's complaint.

MERITS

This case is of course governed by the standard of Rule 56, which states that summary judgment shall be granted only if "there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). The case law is replete with a litany of standards to be applied to summary judgment decisions,¹² but they provide little additional guidance beyond that in the rule itself because the facts of the particular case are more controlling than these judicial paraphrases of the rule. It is the litany of these general principles, however, upon which BEC's opposition to this motion generally rests. The nature of this opposition requires that it be addressed before considering the facts that are not disputed and their bearing on the legal issues governing the merits of this case.

BEC's opposition basically proceeds along two fronts. First, it argues that summary judgment is inappropriate in antitrust cases generally and specifically in this case because of the disputed facts it alleges it has raised. Secondly, it argues that summary judgment is inappropriate at this juncture because BEC has yet to complete its discovery in the case.

In support of this opposition, BEC has filed one of the most unusual documents this Court has ever seen in civil litigation. It is entitled Supplement To Opposition To Motion For Summary Judgment Consisting Of Affidavit Of Sidney Rosen In Support Of Opposition And Further Constituting Statement Of Issues With Regard To Which There Is A Genuine Issue Of Material Fact And A Statement Of Such Facts. The principal item, as the title suggests, is the affidavit of Mr. Rosen, BEC's President and principal owner.

The Rosen affidavit begins with the standard statement that it is "based on personal knowledge." Immediately thereafter, however, he qualifies that claim by stating that some of the content is based on information and belief. As to these facts stated on information and belief, he attempts to improve their reliability by asserting that they are "true according to such information available to him as of the present time."

After these qualifications, the affidavit continues for thirty-six pages, one paragraph of which runs unbroken for over six of those pages. These pages are filled with allegations, claims, assertions, denials, averments, charges of falsehoods and inaccurate data by DeJur, personal attacks upon DeJur's affiants and deponents, and references to the existence of evidence outside the affidavit and record of this case which Mr. Rosen claims will support BEC's case when it goes to trial. At one point Mr. Rosen's affidavit quotes fourteen pages of excerpted portions of the deposition of Mr. W. Bruce Hansen, DeJur's President. Mr. Rosen then asserts that inferences adverse to DeJur are "obvious" from these excerpts and denies Hansen's credibility as to the remaining portions of his deposition. A similar reference to an "obvious" adverse inference is made to an attached document of DeJur's showing its sales to DeJur dealers.¹³ The last pages of the affidavit are almost like an answer to a complaint, quoting a paragraph from DeJur's statement of undisputed facts and then denying the statement or admitting it with qualifications. In sum, it becomes exceedingly difficult to find straightforward statements of hard facts that can be separated from the rest of the affidavit's content and that can then be compared to DeJur's statement of undisputed facts.¹⁴

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