Fed. Corp. v. Future Tire Co.
| Citation | Fed. Corp. v. Future Tire Co., 2:19-cv-6357 (DRH) (AYS) (E.D. N.Y. Jun 22, 2021) |
| Decision Date | 22 June 2021 |
| Docket Number | 2:19-cv-6357 (DRH) (AYS) |
| Parties | FEDERAL CORPORATION, Plaintiff, v. FUTURE TIRE COMPANY, LTD., Defendant. |
| Court | U.S. District Court — Eastern District of New York |
For Plaintiff:
Kevin P. Mulry, Esq.
FARRELL FRITZ, P.C.
400 RXR Plaza
Uniondale, NY 11556
For Defendant:
Leo Fox, Esq.
630 Third Avenue - 18th Floor
New York, NY 10017
INTRODUCTION
Plaintiff Federal Corporation brings this contract action to recover $1,031,845.60 as payment on twenty-six invoices for tires supplied to Defendant Future Tire Company, Ltd. Presently before the Court is Plaintiff's motion for summary judgment pursuant to Federal Rule of Civil Procedure 56. For the reasons set forth below, Plaintiff's motion is GRANTED.
The following facts, taken from the parties' Local Rule 56.1 statements, are undisputed unless otherwise noted. (Pl.'s Statement of Material Facts [DE 25-15] ("Pl. 56.1"); Def.'s Statement of Material Disputed Facts [DE 25-22] ("Def. 56.1")).1
Plaintiff Federal Corporation ("Plaintiff"), a Taiwanese corporation, is a tire supplier and Defendant Future Tire Company, Ltd. ("Defendant"), a New York corporation, is a tire distributor operating across the Northeastern United States. (Pl. 56.1 ¶ 1; Pl.'s Letter dated Sept. 28, 2020 [DE 24]). The parties agree that, by 2017,2 they were in a "contractual relationship" pursuant to which Plaintiff would deliver 20,000 tires every month to Defendant. (Pl. 56.1 ¶ 2; Answer ¶ 51 [DE 11]). Upon Defendant's acceptance, Plaintiff would transmit an invoice to Defendant, which an authorized representative of each party would then sign. . The contract was never formalized in writing, save for certain terms referenced in emails and text messages between the parties. . The parties debate whether their correspondence accurately and fully reflects the terms of their agreement.
Defendant understood the contract to make it "the exclusive distributor of tires produced by Plaintiff" in New York, New Jersey, Connecticut, Pennsylvania and Massachusetts. (Answer ¶ 51). Defendant traces its understanding to the emails and text messages, (Ex. I to Mulry Decl.), "customs and usage of the trade," (Def. Mem. in Opp. at 3 [DE 21] ("Def. Opp.")), and the parties' "long standing and consistent" relations, (id. at 4).
Plaintiff contends their arrangement never included an exclusivity provision. (Pl. 56.1 ¶ 15). According to Joseph Kao, the Operations Director of Plaintiff's wholly owned subsidiary, "if Plaintiff does provide exclusivity to a distributor it only does so through a written exclusive distributorship agreement." (Id. ¶ 16; Kao Decl. ¶¶ 1, 17). No invoices reference the purported exclusivity of the parties' arrangement. (Pl. 56.1 ¶ 18).
Plaintiff delivered, and Defendant accepted and paid for, tires until mid-April 2019. (Id. ¶ 9). At that time, Defendant halted further payment, leaving twenty-six invoices totaling $1,031,845.60 outstanding. (Id.). They remain unpaid. (Id.). Defendant "does not dispute that tires were delivered by" Plaintiff and that it "ow[es] certain amounts of money with respect to such tires." (Def. Opp. at 1).
Plaintiff brings three causes of action: breach of contract, (Compl. ¶¶ 21-27 [DE 1]), account stated, (id. ¶¶ 28-36), and "quantum valebant,"3 (id. ¶¶ 37-46), each seeking the overdue $1,031,845.60. Plaintiff moves for summary judgment on the first two claims as well as for pre-judgment interest on the overdue payment. (See Pl. Mem. in Supp. at 5-8 [DE 25-14] ("Pl. Mem.")).
As noted, Defendant does not dispute overdue payment. Defendant instead affirmatively defends by arguing Plaintiff breached their contract first - (1) "by marketing and selling its product to persons other than the Defendant in Defendant's exclusive market" and refusing to stop at Defendant's request, (Answer ¶¶ 50-57); (2) "by failing to accept the return and replacement of merchandise requested by Defendant," (Def. 56.1 ¶ 2); and (3) "by shipping merchandise" to Defendant's third-party competitor without notifying Defendant, (id.¶ 3). Defendant advances Plaintiff's breach as the reason to deny summary judgment, (see Def. Opp.); Defendant does not assert counterclaims nor cross-move for summary judgment thereon, despite contending it "is entitled to damages as a result" of Plaintiff's breach, (Answer ¶ 57).
Summary judgment, pursuant to Rule 56, is appropriate only where 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). The relevantgoverning law in each case determines which facts are material; "[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). When making this determination, a court must view all facts "in the light most favorable" to the non-movant, Tolan v. Cotton, 572 U.S. 650, 656-57 (2014), and "resolve all ambiguities and draw all permissible factual inferences in favor of the [non-movant]," Johnson v. Killian, 680 F.3d 234, 236 (2d Cir. 2012) (quoting Terry v. Ashcroft, 336 F.3d 128, 137 (2d Cir. 2003)). Thus, "[s]ummary judgment is appropriate [only] where the record taken as a whole could not lead a rational trier of fact to find for the [non-movant]." Id. (internal quotation marks omitted) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)).
To defeat a summary judgment motion properly supported by affidavits, depositions, or other documentation, the non-movant must offer similar materials setting forth specific facts demonstrating that there is a genuine dispute of material fact to be tried. Wright v. Goord, 554 F.3d 255, 266 (2d Cir. 2009). The non-movant must present more than a "scintilla of evidence," Fabrikant v. French, 691 F.3d 193, 205 (2d Cir. 2012) (quoting Anderson, 477 U.S. at 252), or "some metaphysical doubt as to the material facts," Brown v. Eli Lilly & Co., 654 F.3d 347, 358 (2d Cir. 2011) (quoting Matsushita, 475 U.S. at 586-87), and "may not rely on conclusory allegations or unsubstantiated speculation," id. (quoting FDIC v. Great Am. Ins. Co., 607 F.3d 288, 292 (2d Cir. 2010)).
The district court considering a summary judgment motion must also be "mindful . . . of the underlying standards and burdens of proof," Pickett v. RTS Helicopter, 128 F.3d 925, 928 (5th Cir. 1997) (citing Anderson, 477 U.S. at 252), because the "evidentiary burdens that the respective parties will bear at trial guide district courts in their determination[s] of summary judgment motions," Brady v. Town of Colchester, 863 F.2d 205, 211 (2d Cir. 1988). "[W]here the [non-movant] will bear the burden of proof on an issue at trial, the moving party may satisfy its burden by pointing to an absence of evidence to support an essential element of the [non-movant's] case." Crawford v. Franklin Credit Mgmt. Corp., 758 F.3d 473, 486 (2d Cir. 2014) (internal quotation marks omitted) (quoting Brady, 863 F.2d at 210-11). Where a movant without the underlying burden of proof offers evidence that the non-movant has failed to establish his claim, the burden shifts to the non-movant to offer "persuasive evidence that his claim is not 'implausible.'" Brady, 863 F.2d at 211 (citing Matsushita, 475 U.S. at 587). "[A] complete failure of proof concerning an essential element of the [non-movant's] case necessarily renders all other facts immaterial." Crawford, 758 F.3d at 486 (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).
A district court sitting in diversity applies the choice-of-law rules of the forum state, here New York. Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941). Under New York law, contract actions are governed by the law of the state with "the most significant relationship to the transaction and theparties." Zurich Ins. Co. v. Shearson Lehman Hutton, Inc., 84 N.Y.2d 309, 317-18, 642 N.E.2d 1065 (N.Y. 1994). The parties do not expressly advance New York as the state with the most significant relationship. Plaintiff does so implicitly, analyzing the elements to its breach of contract and account stated causes of action "[u]nder New York law." See Pl. Mem. at 5. The Court cannot discern Defendant's position from its case citations. The Court finds New York has "the most significant relationship to the transaction and the parties." Plaintiff, a Taiwanese corporation, accepts New York law governs; Defendant is a New York citizen; the tires exchanged hands in New York; and Defendant warehoused the tires in New York. See Zurich Ins. Co., 84 N.Y.2d at 317-18 (). As such, the Court applies New York law.
Under New York law, a plaintiff can establish a claim for account stated by showing: "(1) an account was presented; (2) it was accepted as correct; and (3) Defendant promised to pay the amount stated." Arch Specialty Ins. Co. v. TDL Restoration, Inc., 2021 WL 1225447, at *9 (S.D.N.Y. Mar. 31, 2021) (quoting Cvar Von Habsburg Grp., LLC v. Decurion Corp., 2020 WL 4577440, at *3 (S.D.N.Y. Mar. 26, 2020)). The second and third elements "may be implied if 'a party receiving a statement of account keeps it without objecting to it within a reasonable time or if the debtor makes partial payment.'" IMG Fragrance Brands, LLC v. Houbigant, Inc., 679 F. Supp. 2d 395, 411 (S.D.N.Y. 2009) (quoting LeBoeuf, Lamb, Greene & MacRae, L.L.P. v. Worsham, 185 F.3d 61, 64 (2d Cir. 1999)).
Plaintiff easily establishes its account stated claim. Plaintiff attaches the twenty-six invoices signed and accepted by Defendant. Ex. A to Kao Decl. These invoices each reflect the quantity,...
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