Carlock v. Pillsbury Co.
| Decision Date | 09 August 1989 |
| Docket Number | Civ. No. 4-87-517,4-87-586. |
| Citation | 719 F. Supp. 791 |
| Parties | Jerry CARLOCK, Gerald Sullivan, Sullock Corporation, Jerrold Crawford, Mary Crawford, John Emry, Marjorie Goldfine, Sander Goldfine, Henry Goldfine, Sacramento Mighty Good Ice Cream, Inc., Dorothy Kranhold, Lester Kranhold, Steven Kranhold, Mark Reiff, Jeffrey Dilson, Jacqueline Dilson, Barry Dumont, Connie Dumont, Caledonia Ice Cream, Inc., Abby Goodman, Robert Goodman, Foothills Ice Cream Works Limited, Edwin Hines, Jennifer Wein, Green Mountain Ice Cream Co., Inc., John Fulton, Sharon Fulton, Frances Fulton, David Fulton, Frances T. Ellsworth, Roy Ellsworth, Howard Belodoff, Idaho Ices, Inc., Janet Drago, Noel Drago, Marsha McCroskey, Christine Curtis, Timothy Curtis, The Inside Scoop, Inc. and I.C.E., Inc., Plaintiffs, v. The PILLSBURY COMPANY, The Haagen-Dazs Shoppe Company, Inc., The Haagen-Dazs Co., Inc., HDF Liquidating Corporation, HDI Liquidating Corporation, WSC Liquidating Corporation, and Doris Mattus-Hurley, Defendants. Thomas DWYER, Tivoli Enterprises, Inc., Vanilla Chip Ice Cream, Co., Aaron Pinkus and Marcia Pinkus, Plaintiffs, v. The PILLSBURY COMPANY, The Haagen-Dazs Shoppe Company, Inc., The Haagen-Dazs Co., Inc., HDF Liquidating Corporation, HDI Liquidating Corporation, WSC Liquidating Corporation, and Doris Mattus-Hurley, Defendants. |
| Court | U.S. District Court — District of Minnesota |
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Richard I. Diamond, Jeff Ross and Mitchell Scott Paul, Estes, Parsinen & Levy and Barry G. Reed, Zimmerman & Reed, Minneapolis, Minn., for plaintiffs.
David Forsberg, Jeffrey Keyes, Jeffrey Shaw and Sally Scoggin, Briggs & Morgan, St. Paul, Minn. and Jonathan L. Eisenberg, Minneapolis, Minn., for defendants Pillsbury Co., Haagen-Dazs Shoppe Company, Inc. and Haagen-Dazs Co., Inc.
William Z. Pentelovitch, Rebecca Palmer, Virginia Bell and Wayne S. Moskowitz, Maslon, Edelman, Borman & Brand, Minneapolis, Minn. and Yee Wah Chin, Shea & Gould, of counsel, New York City, for defendants HDF Liquidating Corp., HDI Liquidating Corp., WSC Liquidating Corp. and Doris Mattus-Hurley.
These two actions have been brought by sixteen groups of Haagen-Dazs franchisees against the franchisors, manufacturers and distributors of that well-known ice cream. The plaintiffs in the Carlock case are franchisees whose Haagen-Dazs "shoppes" are located in California, Colorado, Idaho, Oregon and Washington. The plaintiffs in the Dwyer case are franchisees with shoppes located in Minnesota. One plaintiff in the Dwyer case, Thomas Dwyer, was the local distributor for Haagen-Dazs in the Twin Cities area, as well as a franchisee. In both cases, plaintiffs allege fraud, misrepresentation, breach of contract, breach of the implied covenants of good faith and fair dealing, antitrust violations, and various state statutory claims. Two motions are now before the Court.1 Defendants have moved for summary judgment on all but one of plaintiffs' claims.2 Plaintiffs have moved for summary judgment on their claim that the royalty and advertising contributions collected by defendants exceeded the amounts provided by the franchise agreement.
There are seven defendants in each case. Three of the defendants are the corporations which originally developed and marketed Haagen-Dazs ice cream, now titled the WSC Liquidating Corporation, the HDF Liquidating Corporation, and the HDI Liquidating Corporation. The operations of those corporations were sold to the Pillsbury Company on July 11, 1983. The Pillsbury Company and the two subsidiaries responsible for its Haagen-Dazs operations are also defendants in these cases. In addition, there is one individual defendant, Doris Mattus-Hurley.
Mattus-Hurley is the daughter of Reuben Mattus and Rose Mattus, the founders of the Haagen-Dazs ice cream business. Mattus-Hurley opened the first Haagen-Dazs Shoppe in 1976, founded the franchise system in 1978, and served as president of the franchisor corporations from 1978 to 1985.
Originally named the Woodbridge Sweets Company, WSC was founded by Reuben Mattus and Rose Mattus. WSC manufactured Haagen-Dazs ice cream at its plant in Woodbridge, New Jersey and sold the ice cream to approximately 150 distributors who in turn sold the ice cream to retailers. WSC also sold ice cream to Mattus-Hurley's franchise company, which in turn sold the ice cream to its franchisees. The business and affairs of WSC have been wound up and liquidated.
HDF was founded in 1978 by Mattus-Hurley under the name Haagen-Dazs Franchise, Inc. HDF franchised about 300 Haagen-Dazs Shoppes around the country. HDF purchased ice cream from WSC and resold it to franchisees. HDF is now an inactive corporation.
HDI, originally known as Haagen-Dazs, Inc., distributed ice cream in metropolitan New York. It purchased ice cream from WSC and resold it to retailers in the New York area. HDI has been liquidated.
Pillsbury, a diversified international food and restaurant company, purchased the assets of WSC, HDF, and HDI and related entities on July 11, 1983.
HDC is a wholly-owned subsidiary of Pillsbury which was created to manufacture Haagen-Dazs ice cream. HDC operates the original Woodbridge, New Jersey plant as well as a newer plant in Tulare, California. Like WSC before it, HDC sells ice cream to distributors for resale to retailers and to the franchise company (the Haagen-Dazs Shoppe Company, Inc., discussed below) for resale to franchisees.
HDSC, a wholly-owned subsidiary of Pillsbury, operates the franchise shoppe business. It is the assignee of the franchise agreements to which HDF was a party. HDSC purchases ice cream from HDC and resells it to franchisees.
The claims in the Carlock case involve eighteen shoppes; the Dwyer claims involve five shoppes. The chart below summarizes, for each plaintiff, the date each franchise agreement was signed, the location of each franchise, and whether the franchise remains open.
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