BVS, Inc. v. CDW Direct, LLC, 11–CV–79–LRR.
| Decision Date | 14 February 2015 |
| Docket Number | No. 11–CV–79–LRR.,11–CV–79–LRR. |
| Citation | 88 F.Supp.3d 948 |
| Parties | BVS, INC., Plaintiff, v. CDW DIRECT, LLC, Defendant and Third–Party Plaintiff, v. Arrow Electronics, Inc., TSSLink, Inc. and NetApp, Inc., Third–Party Defendants. NetApp, Inc., Counter Claimant, v. CDW Direct, LLC, Counter Defendant. |
| Court | U.S. District Court — Northern District of Iowa |
Vernon Pellett Squires, Natalie K. Ditmars, Bradley and Riley PC, Cedar Rapids, IA, for Plaintiff.
Dana L. Oxley, Kevin J. Caster, Theresa C. Davis, Shuttleworth & Ingersoll, PLC, Cedar Rapids, IA, for Defendant and Third–Party Plaintiff.
Gregory M. Lederer, Brenda K. Wallrichs, Megan Rett Dimitt, Lederer, Weston, Craig, PLC, Cedar Rapids, IA, Daniel L. Casas, Casas Riley Simonian LLP, Campbell, CA, for Third–Party Defendants.
TABLE OF CONTENTSI.INTRODUCTION 954II.PROCEDURAL HISTORY 954III.SUBJECT MATTER JURISDICTION 955IV.SUMMARY JUDGMENT STANDARD 956V.RELEVANT FACTUAL BACKGROUND 956A.Parties 956B.SAN Project Design 957C.Installation and Implementation 957VI.CHOICE OF LAW 958VII.NETAPP MOTION 958A.Common Liability and Contribution Claim 9581.Parties' arguments 9592.Applicable law 9593.Application a.Express warranty 959b.Implied warranties 961c.Breach of contract 962d.Unjust enrichment 963e.Fraud 963B.Contractual Indemnity Claim 9641.Parties' arguments 9642.Applicable law 9653.Application 965C.Summary of Disposition of NetApp Motion 966VIII.ARROW MOTION 966A.Common Liability and Contribution Claim 9661.Parties' arguments 9662.Applicable law 9663.Application 967a.Third-party beneficiary breach of contract 967b.Express warranty 968c.Implied warranty of fitness for a particular purpose 969d.Breach of contract 970e.Unjust enrichment 970B.Contractual Indemnity Claim 970C.Breach of Contract Claim 971D.Summary of Disposition of the Arrow Motion 971IX.TSSLINK MOTION 971A.Common Liability and Contribution Claim 9711.Parties' arguments 9712.Applicable law 9713.Application 972a.Express warranty 972b.Implied warranty of fitness for a particular purpose 973c.Breach of contract 974d.Unjust enrichment 974B.Third–Party Beneficiary Breach of Contract 974C.Forum Selection Clause 975D.Summary of Disposition of the TSSLink Motion 977X.CONCLUSION 977
The matters before the court are Arrow Electronics, Inc.'s (“Arrow”) Motion for Summary Judgment (“Arrow Motion”) (docket no. 139), TSSLink, Inc.'s (“TSSLink”) Motion for Summary Judgment (“TSSLink Motion”) (docket no. 140) and NetApp, Inc.'s (“NetApp”) Motion for Summary Judgment (“NetApp Motion”) (docket no. 141).
On July 19, 2011, BVS, Inc. (“BVS”) filed a Complaint (docket no. 2) against CDW Direct, LLC (“CDW”), Arrow and TSSLink, alleging breach of contract and unjust enrichment. On February 13, 2012, BVS moved the court to dismiss the claims against Arrow and TSSLink. See Motion to Dismiss (docket no. 27) at 2. On March 2, 2012, the court dismissed Arrow and TSSLink from the instant action without prejudice. See March 2, 2012 Order (docket no. 31) at 1.
On April 16, 2012, BVS filed an Amended Complaint (docket no. 38) against CDW. In the Amended Complaint, BVS alleges breach of contract (Count I), unjust enrichment (Count II), breach of express warranty (Count III), breach of implied warranty of merchantability (Count IV), breach of implied warranty of fitness for a particular purpose (Count V), fraud (Count VI) and fraudulent nondisclosure (Count VII)1 against CDW.
On April 17, 2012, CDW filed a Third–Party Complaint (docket no. 41) against NetApp, Arrow and TSSLink. In the Third–Party Complaint, CDW alleges that NetApp, Arrow and TSSLink are liable to CDW for contribution and indemnity if CDW is found liable to BVS (Count I), NetApp is liable for contractual indemnity if CDW is found liable to BVS (Count II), Arrow is liable for contractual indemnity if CDW is found liable to BVS (Count III), Arrow breached its contract with CDW (Count IV) and TSSLink breached its contract with Arrow, which CDW can enforce as a third-party beneficiary of the contract (Count V).
On May 9, 2012, CDW filed an Answer (docket no. 45) to the Amended Complaint, denying BVS's claims and asserting affirmative defenses. On June 25, 2012, Arrow filed an Answer (docket no. 50) to the Third–Party Complaint, denying CDW's claims. On that same date, NetApp filed an Answer (docket no. 49) to the Third–Party Complaint, denying CDW's claims, asserting affirmative defenses and asserting a counterclaim against CDW for attorneys' fees and expenses. Also on that same date, TSSLink filed an Answer (docket no. 48) to the Third–Party Complaint, denying CDW's claims and asserting affirmative defenses.
On December 13, 2012, Arrow moved for summary judgment (docket no. 66). On December 14, 2012, NetApp and TSSLink moved for summary judgment (docket nos. 6768). On March 28, 2013, the court granted CDW's motion for summary judgment against BVS and denied as moot Arrow's, NetApp's and TSSLink's motions for summary judgment against CDW. March 28, 2013 Order (docket no. 109). On July 17, 2014, the Eighth Circuit Court of Appeals reversed and remanded. See BVS, Inc. v. CDW Direct, LLC, 759 F.3d 869, 873 (8th Cir.2014).
On September 5, 2014, Arrow filed the Arrow Motion, TSSLink filed the TSSLink Motion and NetApp filed the NetApp Motion. On September 26, 2014, CDW filed a Resistance to the Arrow Motion (docket no. 139), a Resistance to the NetApp Motion (docket no. 140) and a Resistance to the TSSLink Motion (docket no. 141). On October 3, 2014, NetApp filed a Reply (“NetApp's Reply”) (docket no. 150). On that same date, TSSLink filed a Reply (“TSSLink's Reply”) (docket no. 152). On October 7, 2014, Arrow filed a Reply (“Arrow's Reply”) (docket no. 154). On February 12, 2015, the court held a hearing on the Arrow Motion, the TSSLink Motion and the NetApp Motion, at which the court heard additional argument. See February 12, 2015 Minute Entry (docket no. 177). The matters are fully submitted and ready for decision.
The court has diversity jurisdiction over this case because complete diversity exists between BVS and CDW and the amount in controversy exceeds $75,000. See 28 U.S.C. § 1332 (). To the extent that complete diversity does not exist between CDW and all third-party defendants, the court has supplemental jurisdiction over the Third–Party Complaint. See 28 U.S.C. § 1367 ().
Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “A dispute is genuine if the evidence is such that it could cause a reasonable jury to return a verdict for either party; a fact is material if its resolution affects the outcome of the case.” Amini v. City of Minneapolis, 643 F.3d 1068, 1074 (8th Cir.2011) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 252, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ), cert. denied, ––– U.S. ––––, 132 S.Ct. 1144, 181 L.Ed.2d 1018 (2012). “[S]elf-serving allegations and denials are insufficient to create a genuine issue of material fact.” Anuforo v. Comm'r, 614 F.3d 799, 807 (8th Cir.2010).
“To survive a motion for summary judgment, the nonmoving party must substantiate [its] allegations with sufficient probative evidence [that] would permit a finding in [its] favor based on more than mere speculation, conjecture, or fantasy.” Barber v. C1 Truck Driver Training, LLC, 656 F.3d 782, 801 (8th Cir.2011) () (quoting Putman v. Unity Health Sys., 348 F.3d 732, 733–34 (8th Cir.2003) ) (internal quotation marks omitted). The court must view the record in the light most favorable to the non-moving party and afford it all reasonable inferences. See Schmidt v. Des Moines Pub. Sch., 655 F.3d 811, 819 (8th Cir.2011). The non-moving party “has the obligation to come forward with specific facts showing that there is a genuine issue for trial.” B.M. ex rel. Miller v. S. Callaway R–II Sch. Dist., 732 F.3d 882, 886 (8th Cir.2013) (quoting Atkinson v. City of Mountain View, 709 F.3d 1201, 1207 (8th Cir.2013) ) (internal quotation marks omitted). “A complete failure by the non-moving party ‘to make a showing sufficient to establish the existence of an element essential to that party's case ... necessarily renders all other facts immaterial.’ ” Id. (alteration in original) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322–23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ).
Viewing the evidence in the light most favorable to CDW and affording it all reasonable inferences, the uncontested material facts are as follows.
BVS is an Iowa corporation with its principal place of business in Cedar Rapids, Iowa. BVS provides online training to banks and credit unions. BVS provides its training services over the internet through the BVS computer system. BVS's main computer system is located in Cedar Rapids, Iowa. BVS also has a disaster recovery system in Omaha, Nebraska. Roy Karon owns BVS. During the relevant period, Gary Praegitzer was the BVS information technology (“IT”) manager and Sean Reinhard worked in the BVS IT department.
CDW is an Illinois limited liability company with its principal place of business in Vernon Hills, Illinois. CDW...
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