J.D. Fields & Co. v. Steel

• Decision Date: 30 September 2013
• Docket Number: Case No. 4:12–cv–00754–KGB.
• Parties: J.D. FIELDS & COMPANY, INC., Plaintiff v. NUCOR–YAMATO STEEL, Defendant.
• Court: U.S. District Court — Eastern District of Arkansas

976 F.Supp.2d 1051

J.D. FIELDS & COMPANY, INC., Plaintiff

v.NUCOR–YAMATO STEEL, Defendant.

Case No. 4:12–cv–00754–KGB.

United States District Court,

E.D. Arkansas,

Western Division.

Sept. 30, 2013.

David D. Wilson, James M. Simpson, Jr., Friday, Eldredge & Clark, LLP, Little Rock, AR, John J. Sullivan, Hill Rivkins, LLP, New York, NY, Steven P. Vangel, Hill Rivkins LLP, Houston, TX, for Plaintiff.

Donna E. Patterson, Jason Ewart, Michael D. Thorpe, Robert J. Katerberg, Arnold & Porter LLP, Washington, DC, Douglas R. Gunson, Nucor Corporation, Charlotte, NC, M. Tim Boe, Haley Heath Burks, Rose Law Firm, Little Rock, AR, for Defendant.

OPINION AND ORDER

KRISTINE G. BAKER, District Judge.

Plaintiff J.D. Fields & Company, Inc. (“Fields”) brings this action against defendant Nucor–Yamato Steel Company (“NYS”), alleging violations of the Robinson–Patman Act, 15 U.S.C. § 13(a), and state-law claims of tortious interference, fraudulent misrepresentation, negligent misrepresentation, conspiracy, and breach of contract. Before the Court is NYS's motion for judgment on the pleadings (Dkt. No. 37). Fields has responded (Dkt. No. 58), and NYS has replied (Dkt. No. 60). For the following reasons, the motion is granted in part and denied in part (Dkt. No. 37).

I. FACTUAL AND PROCEDURAL BACKGROUND

Defendant NYS is a manufacturer and supplier of structural steel products, including products known as H-pilings.¹ NYS is one of three U.S. manufacturers of H-pilings (Dkt. No. 1, ¶ 7). Fields is a supplier of structural steel products, including H-pilings, throughout the United States. On May 4, 2005, Fields and NYS entered into a seven-year supply agreement in which NYS agreed to be Fields's exclusive supplier, and Fields agreed to purchase its requirement for structural steel products to be sold by Fields in North America ( Id., ¶ 8).

During the “covered period” ² of NYS's and Fields's supply agreement, NYS had supply agreements with distributors, customers, and dealers of H-pilings in the “relevant market” ³ other than Fields. Fields alleges that NYS had a contract with one of these distributors, customers, and dealers that was a competitor of Fields—a company known as Skyline Steel LLC (“Skyline”), a subsidiary of ArcelorMittal (Dkt. No. 1, ¶ 11).

Fields alleges that prior to and during the covered period, it “repeatedly requested commercially reasonable assurances from [NYS] that Fields would be and was receiving equal pricing and benefits to what [NYS] was, or would be, offering to other distributors, customers, and purchasers including Skyline, in the relevant market.” (Dkt. No. 1, ¶ 12). In addition, Fields alleges that it had an earlier supply agreement with NYS from 1999 through 2005 and that, in entering into the earlier agreement, it relied on assurances from NYS that it would receive equal pricing for steel products throughout the duration of their contractual relationship ( Id.). Fields states that it entered into the latest supply agreement with NYS in 2005 based on the same assurances of equal pricing from NYS ( Id.).

Fields alleges that, on or about June 16, 2010, it placed an order with NYS for 10? and 14? H-pilings and NYS sent back a sales-order acknowledgment indicating a shipment of the same products to Skyline (Dkt. No. 1, ¶ 13). Fields states that NYS had provided a quote to Fields “at which product was made available for purchase by Fields at an effective price of $34.00/cwt,” but the acknowledgement NYS made to Skyline “reflected a purchase price of only $32.00/cwt. The difference on that order alone amounted to a price differential of over $20,000.00.” ( Id.).

Fields claims that it “has since learned” that NYS “has engaged in a pattern of conduct during the covered period of providing Skyline preferential pricing in the relevant market of at least $2.00/cwt (if not more) on other sales below the prices [NYS] quoted to Fields for identical commodities.” (Dkt. No. 1, ¶ 14). Fields states that NYS continued to represent that none of its other distributors received preferential pricing even after Fields asked about these discrepancies ( Id.). Fields claims that, as a direct result of the preferential pricing NYS provided to Skyline in the relevant market during the covered period, NYS gave Skyline a competitive advantage over Fields, which enabled Skyline to offer lower quotations than Fields on projects for which both Fields and Skyline competed ( Id., ¶ 15). Fields alleges that, as a result, “it lost out on price quotes for governmental and other contracts on which Fields competed with Skyline. Skyline was able to quote lower prices than Fields on these projects because of the preferential treatment.” ( Id.).

Fields further alleges that NYS actively worked with Skyline to undercut Fields on its price quotes for these projects by misrepresenting the availability of structural steel products, such as H-pilings (Dkt. No. 1, ¶ 16). “For example, when Fields sought information from [NYS] on the availability of H-piles in order to offer a price quote on certain projects, [NYS] would tell Fields that no such quantities of H-piles were available during the time period needed and usually declined to make additional rollings for such products to fulfill Fields's request.” ( Id.).

Fields states that NYS often advised it that no supplies of H-piles were available during various time periods but would supply such H-piles to Skyline or make additional rollings of such products at Skyline's request ( Id., ¶ 17). Fields states that NYS “repeatedly restricted its allocation of H-piles to Fields, while [NYS] did not place any such restrictions on Skyline. As a direct result, Skyline was able to offer quotes and be awarded contracts on such projects over Fields in the relevant market during the covered period.” ( Id.).

Fields's complaint then references several “specific examples” of NYS's alleged conduct regarding purported preferential pricing and product availability in July and August 2009 (Dkt. No. 1, ¶¶ 18–20). First, Fields alleges that, in July 2009, it requested a project price from NYS in order to offer a quote to supply H-piles for a highway interchange in San Bernardino County, California. Fields states that NYS failed to provide a project price and instead offered Fields a “mill price” of $39.00/cwt and advised that transportation costs would be an additional $3.08/cwt to $4.97/cwt. Fields states that it subsequently learned that NYS offered a lower mill price and lower transportation cost to Skyline, leaving Fields unable to offer a competitive low price quote on the project ( Id., ¶ 18).

Fields alleges that it sought another quote from NYS in mid-August 2009 for Fields to offer a quote to supply steel for a later phase of the San Bernardino County highway interchange project. Fields states that NYS refused at the time to supply Fields with the H-piles requested for less than $35.00/cwt, leaving Fields unable to offer a competitive quote on the project. Fields states that it learned that other contractors offering quotes on the project, including Skyline, had received quotes at significantly lower prices from NYS, giving those contractors a competitive advantage over Fields (Dkt. No. 1, ¶ 19).

Fields alleges that, in late August 2009, it sought another quote from NYS for H-piles and wide flange beams to offer a quote on another project. Fields claims that NYS offered it the steel products for $37.00/cwt, even though Fields had advised NYS that it could not offer a quote on the job at a price higher than $35.00/cwt. Fields states that NYS did not alter its quote to Fields even though it had offered a lower quote to Skyline, leaving Fields unable to offer a competitive quote on the project (Dkt. No. 1, ¶ 20).

In addition, Fields alleges that NYS refused to provide it with quotes for steel products pertaining to jobs in Puerto Rico, although the supply agreement between Fields and NYS for the North American market did not restrict Fields from supplying steel products in Puerto Rico. Fields claims that NYS had effectively given Skyline an “exclusive” with respect to supplying H-pile steel for jobs in Puerto Rico, and that, as a direct result of NYS's discriminatory practices, it was unable to offer competitive quotes for jobs in Puerto Rico (Dkt. No. 1, ¶ 21).

Fields's complaint also alleges that, in addition to H-piles, Fields sought to supply a separate structural steel product, known as sheet piles, to the relevant market during the covered period, but NYS unreasonably terminated Fields's right to be a distributor for sheet piles based on Fields's prior relationship with a foreign manufacturer of sheet piles. Fields claims that NYS had provided sheet piles to others, including Skyline, and that NYS sold sheet piles to Skyline when Skyline was also selling foreign-manufactured sheet piles in the domestic market. Fields claims that it was forced to purchase sheet piles from third parties at a markup above what NYS was offering to its sheet-piles dealers, customers, or distributors (Dkt. No. 1, ¶ 22).

Fields's seven-year supply contract with NYS terminated on May 4, 2012. Fields claims that on May 17, 2012, NYS announced that it would acquire Skyline in a buyout pending regulatory approval, and on June 21, 2012, NYS announced that it had completed its acquisition of Skyline (Dkt. No. 1, ¶ 24). ⁴

On June 26, 2012, Fields filed its complaint in the United States District Court for the Southern District of Texas, alleging violations of the Robinson–Patman Act, 15 U.S.C. § 13(a), and claims for tortious interference, fraudulent misrepresentation, negligent misrepresentation, conspiracy, and breach of contract (Dkt. No. 1). On August 20, 2012, NYS moved to dismiss the complaint for lack of personal jurisdiction and / or improper venue pursuant to Federal Rule of Civil Procedure 12(b)(2) and (3), or in the alternative, to transfer the case to this district (Dkt. No. 20). On December 4, 2012, the United...