Cecil Corley Motor Co., Inc. v. General Motors Corp.

• Decision Date: 17 July 1974
• Docket Number: Civ. A. No. 5572.
• Parties: CECIL CORLEY MOTOR COMPANY, INC. and Cecil Corley, Jr., Plaintiffs, v. GENERAL MOTORS CORPORATION and Paul Porter, Defendants.
• Court: U.S. District Court — Middle District of Tennessee

380 F. Supp. 819

CECIL CORLEY MOTOR COMPANY, INC. and Cecil Corley, Jr., Plaintiffs, v. GENERAL MOTORS CORPORATION and Paul Porter, Defendants.

Civ. A. No. 5572.

United States District Court, M. D. Tennessee, Nashville Division.

July 17, 1974.

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Gareth S. Aden, Harland Dodson, III, Nashville, Tenn., for plaintiffs.

Wm. F. Carpenter, Richard D. Speight, William H. Woods, Goodpasture, Carpenter, Woods & Sasser, Nashville, Tenn., Julius L. Russu, William B. Slowey, Jr., General Motors Corp., Detroit, Mich., for General Motors Corp.

John C. Tune, Jr., Nashville, Tenn., for Paul Porter.

MEMORANDUM

MORTON, District Judge.

After jury trial and verdict in favor of the corporate plaintiff, Cecil Corley Motor Company, Inc., but not for the individual plaintiff, Cecil Corley, Jr., this civil private antitrust, breach of contract and Dealers Day In Court action is now before the Court on General Motors' motion for judgment notwithstanding the verdict under Fed.Rules Civ.Proc. 50(b), or a new trial, Fed.Rules Civ. Proc. 59.

The Court has carefully re-examined the evidence in light of the briefs, and by a direct review of the transcript of the trial, to test the reservations with which the Court, after denying General Motors' motions for a mistrial, and, for a directed verdict under Rule 50(a), Fed.Rules Civ.Proc., submitted the issues to a jury under Rule 50(b), Fed. Rules Civ.Proc.

Further examination of the record has confirmed the view of the Court that the evidence on the issues of liability and damages is wholly insufficient, or at least so insubstantial and lacking in probative value that there is no evidence whatsoever from which the jury might rationally have concluded that defendant General Motors had violated the federal statutes in question or breached its contract with plaintiff or otherwise injured the business of plaintiff; that General Motors' motion for a directed verdict in its favor should be, and is, hereby ordered with the alternative provision that in the event such order should be vacated or reversed on appeal, the order for a new trial of the issues, unless also vacated or reversed on appeal, shall remain in effect. (See Rule 50(b) and (c) Fed.Rules Civ.Proc.).

The Court is fully mindful that the test for the propriety of judgment notwithstanding the verdict is precisely the same as that which governs a motion for directed verdict "since the motion for judgment notwithstanding the verdict merely renews an earlier motion for a directed verdict," Minton v. Southern Railway Co., 368 F.2d 719, 720 (6th Cir. 1966). The test is whether in this case, considering the evidence in its most favorable light for plaintiff and giving to plaintiff's evidence all the fair value to which it is reasonably entitled and indulging every reasonable inference favorable to plaintiff, there is evidence of sufficient substantiality and probative value from which the jury might rationally find a verdict in favor of plaintiff. Moore's Federal Practice § 50.07, pp. 2356-2357; Wright & Miller Practice & Procedure § 2524; Massey v. F. H. McGraw & Co., 233 F.2d 905 (6th Cir. 1956).

The verdict of a jury should not be lightly set aside, nor should a new trial be lightly granted — certainly not for the mere reason that the Court may disagree with the verdict. However, in this case the Court is convinced that this verdict for the plaintiff, if allowed to stand, would be a legally unjustified windfall to the plaintiff and a miscarriage of justice. Plaintiff cannot go to the jury on the basis of speculation, surmise or conjecture. Dayton Veneer & Lumber Mills v. Cincinnati, N.O. & T.P. Ry. Co., 132 F.2d 222, 223 (6th Cir. 1942); Wolfe v. National Lead Company, 225 F.2d 427, 433-434 (9th Cir. 1955). It also must be remembered that forced or violent inferences may not be drawn and that an inference is a permissible deduction only when it may be reached by logic or reason. An inference results from and depends upon the process of reasoning and it cannot be invoked on the basis of speculation and conjecture. First National Bank of Arizona v. Cities Service Co., 391 U.S. 253, 284-290, 88 S.Ct. 1575, 20 L.Ed.2d 569 (1968); Galloway v. United States, 319 U.S. 372, 395, 63 S.Ct. 1077, 87 L.Ed. 1458 (1943); Daily Press, Inc. v. United Press International, 412 F.2d 126, 133 (6th Cir. 1969), cert. denied, 396 U.S. 990, 90 S.Ct. 480, 24 L.Ed.2d 453 (1969).

In fairness to the jury, the Court notes that the length of the trial, the numerous exhibits, the technical, complicated subjects, and various specious considerations contributed to a jury verdict which is legally impermissible. However, the law is designed so that in such circumstances the Court must measure up to its responsibility and act in accordance with its considered evaluation of the record.

THE PARTIES

From 1957 to January 19, 1966, Cecil Corley, Jr. operated an automobile dealership in Gallatin, Tennessee (about 30 miles from Nashville) as a sole proprietorship, under franchise agreements issued separately from time to time by Oldsmobile, Pontiac and GMC Truck divisions of General Motors Corporation, and by American Motors Corporation. On January 19, 1966, Cecil Corley, Jr., caused the business to be incorporated as Cecil Corley Motor Company, Inc., and this corporation continued to operate as an American Motors dealer until sometime in 1967, when it voluntarily terminated its contract with American Motors Corporation, and as an Oldsmobile, Pontiac and GMC Truck dealer of General Motors until April 1, 1970, when it again voluntarily terminated its contracts with General Motors, sold its assets, and went out of the automobile business.¹

Cecil Corley, Jr. had discussed incorporation with General Motors in 1965, requesting that the existing Franchise Agreements be terminated and that new Agreements be executed with the proposed corporation. Pontiac Motor Division of General Motors would not agree to the granting of an Agreement to the proposed corporation unless Cecil Corley, Jr. executed a general release in Pontiac's favor. Before trial, Cecil Corley, Jr., having admitted to executing a general release (except for antitrust claims) in favor of Pontiac Motor Division as consideration for the granting of an Agreement to the plaintiff corporation,² this Court granted General Motors' motion for partial summary judgment with respect to any breach of contract claims asserted by the individual plaintiff, Cecil Corley, Jr.

From 1948 until October 1968, defendant, Paul Porter, was a partner with his father, B. A. Porter, in a Pontiac dealership known as Broadway Motor Company in Hartsville, Tennessee, some 16 miles northeast of Gallatin and 45 miles northeast of Nashville. (B. A. Porter had obtained his first Agreement with Pontiac at Hartsville in 1935.) In October 1968, Broadway Motor Company terminated its Dealer Selling Agreement with Pontiac Motor Division and moved to Lebanon, Tennessee. A new entity, Porter-Pontiac, Inc. obtained Pontiac and GMC Truck Franchise Agreements for Lebanon in October 1968.

Defendant Pontiac Motor Division is an automobile manufacturer engaged in the manufacture and sale of Pontiac automobiles and other products in interstate commerce throughout the United States, including the Middle District of Tennessee.

The Court notes that the only defendants in this litigation were Pontiac Motor Division and Paul Porter. Plaintiff corporation expressly disclaimed that any acts of Porter-Pontiac, Inc. had caused it injury or that any conspiracy had existed between Porter-Pontiac, Inc. and Pontiac Motor Division.³ Further, the evidence was unequivocal that plaintiff corporation neither sought nor claimed damages for any acts of either Oldsmobile or GMC Truck Division of General Motors.⁴ The evidence was also undisputed that some six months after plaintiff corporation commenced the instant litigation, it executed a full and complete release of any and all claims in favor of Oldsmobile Division of General Motors.⁵

THE PONTIAC AGREEMENT

The Agreement between Cecil Corley Motor Company, Inc. and Pontiac Motor Division is identical in form with that of all Pontiac dealers in the United States, including Broadway Motor Company, with minor exceptions, such as the designation of the area of sales and service responsibility. The Agreement is entitled "Pontiac Dealer Selling Agreement", and consists of (1) the Dealer Sales Agreement, a three-page document containing the general purposes, considerations and parties; (2) a booklet containing Additional Provisions which are incorporated by reference in the Agreement; and (3) other addenda incorporated by reference.⁶

The Agreement is an integrated contract which meticulously spells out the rights and obligations of the parties and includes in Section 26 a provision for a strict enforcement of the parol evidence rule. Similar contracts have been held to be integrated contracts and not subject to parol modification. See, e. g., Victory Motors of Savannah, Inc. v. Chrysler Motors Corp., 357 F.2d 429, 431 (5th Cir. 1966); Globe Motors, Inc. v. Studebaker-Packard Corporation, 328 F.2d 645, 649 (3rd Cir. 1964). Moreover, in Tennessee the parol evidence rule is a rule of substantive law, United States ex rel T.V.A. v. Easement, etc., 271 F.Supp. 55 (E.D.Tenn.1966); Cummings & Co. v. Mascari, 55 Tenn.App. 512, 402 S.W.2d 719 (W.S.1965); Marron v. Scarbrough, 44 Tenn.App. 414, 314 S.W.2d 165 (W.S.1958), which clearly prevents the introduction of parol evidence that would contradict the terms of a written contract. Clayton v. Haury, 224 Tenn. 222, 452 S.W.2d 865 (1970); Livingston v. Livingston, 58 Tenn.App. 271, 429 S.W.2d 452 (W.S.1967); Patterson v. Anderson Motor Co., 45 Tenn. App. 35, 319 S.W.2d 492 (W.S.1959); Marron v. Scarbrough, supra. Thus, this case is...