Page Plus of Atlanta, Inc. v. Owl Wireless, LLC
| Decision Date | 16 October 2012 |
| Docket Number | Case No. 3:11 CV 2757 |
| Parties | Page Plus of Atlanta, Inc. and SNAP Prepaid LLC, Plaintiffs, v. Owl Wireless, LLC, Defendant. |
| Court | U.S. District Court — Northern District of Ohio |
In advance of the scheduled September trial date in this case, Plaintiffs, Page Plus of Atlanta, Inc. and SNAP Prepaid, LLC (collectively, "Plaintiffs"), and Defendant Owl Wireless, LLC ("Owl") filed Motions in Limine (Docs. 48, 50 & 55) raising issues regarding an alleged assignment from Page Plus to Snap, and the materiality of the respective contract breaches by Plaintiffs and Owl. This Court held a hearing where these issues were further discussed (Doc. 90). This Court then requested additional briefing from the parties (Docs. 108 & 109).
This Court now finds that no assignment occurred as a matter of law and dismisses Count I of the Complaint (Doc. 1). The only issue remaining for trial is the amount of damages to be awarded to Owl for the breach by Page Plus of Section 2.1 of the Agreement (Doc. 6).
This is a dispute between Plaintiffs, affiliated distributors, and Defendant Owl, a wholesale supplier. Both parties are involved in the business of prepaid phone cards and cell phones. As a result of prior litigation, Page Plus and Owl entered into an October 2008 Distribution Agreement ("Agreement") under which each party assumed various rights and obligations related to the sale ofprepaid air time and phone cards. The Agreement expired on October 31, 2010. On October 8, 2010, Page Plus initiated litigation against Owl (Case No. 10 CV 2296 at Doc. 1). This Court dismissed that case and allowed Page Plus to refile under the instant case number in order to enable Page Plus to add Snap as a new party.
In an earlier Order (Doc. 22), this Court held that both Plaintiffs and Owl breached the Agreement. This Court found that Owl breached Section 7 of the Agreement when it adjusted its pricing for Plaintiffs without also increasing pricing to other customers (id. at 6). This Court also found that Plaintiffs breached Section 2.1 of the Agreement by selling to Blackstone and Budget after these accounts were transferred to Owl (id. at 10).
Page Plus alleges that, effective January 1, 2009, it assigned its rights and obligations under the Agreement to Snap. As this litigation has progressed, the parties have keyed in on whether an assignment of the Agreement actually occurred and the legal effect of such an assignment. Owl contends the assignment was invalid; Plaintiffs claim the assignment was valid and, even if it was not, Plaintiffs still can recover on their breach of contract claim.
A court may, after "giving notice and a reasonable time to respond," grant summary judgment on its own "after identifying for the parties material facts that may not be genuinely in dispute." Fed. Civ. R. 56(f). Pursuant to Federal Civil Rule 56(a), summary judgment is appropriate where there is "no genuine issue as to any material fact" and a party is "entitled to judgment as a matter of law." This burden "may be discharged by 'showing' that is, pointing out to the district court -- that there is an absence of evidence to support the nonmoving party's case." Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). When considering summary judgment, this Court must draw all inferences from therecord in the light most favorable to the non-moving party. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). This Court is not permitted to weigh the evidence or determine the truth of any matter in dispute; rather, this Court determines only whether the case contains sufficient evidence from which a jury could reasonably find for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49 (1986).
The parties dispute whether Page Plus assigned its rights and obligations under the Agreement to Snap. Owl contends no such assignment occurred and, as a result, Plaintiffs have no damage claim against Owl because the breach of contract claim was brought in Snap's name alone. The Complaint (Doc. 1) filed in the instant litigation reads in part as follows:
COUNT I
(Breach of Contract - Pricing Changes on behalf of SNAP)
The remaining Counts in the Complaint have been dismissed by this Court (see Doc. 22).
Owl correctly points out that Snap cannot sue Owl for breach of the Agreement if Page Plus never validly assigned the Agreement to Snap in the first place. See Thornton v. Windsor House, Inc., 57 Ohio St. 3d 158, 161 (1991) (). (Plaintiffs do not claim that Snap is an intended third-party beneficiary.) If the assignment is invalid, Page Plus may have otherwise been able to maintain a claim against Owl for breach of the Agreement but for the fact Plaintiffs specifically and intentionally pled this claim in Snap's name alone.
Why did Page Plus add Snap as a party to this litigation in the first place? At some point, Page Plus realized that the bulk of purchases from Owl were made by Snap, not Page Plus. This Court allowed Page Plus -- on the eve of the first trial date to refile and amend its pleadings to add Snap as a party. And now, on the eve of this trial, Plaintiffs find themselves in another hole dug by themselves.
An assignment of rights is, itself, a contract, and "in order to establish an assignment, the elements of a contract must be present." Hamrick v. Safe Auto Ins. Co., 2009 WL 790306, at *4 (Ohio Ct. App. 2009). Those essential elements include mutual assent and consideration. Id. "No particular words are required to create an assignment," rather "any word or transaction which shows an intention on the one side to assign and on the other to receive, if there is a valuable consideration, will operate to create an assignment." Hsu v. Parker, 116 Ohio App. 3d 629, 632 (1996) (internal citations and quotation marks omitted). The party alleging the existence of the contract bears the burden of showing there was a meeting of the minds and that the contract was definite as to its essential terms. Hamrick, 2009 WL 790306, at *4.
The narrow question here, as admitted by the parties in their briefing and at the hearing, is whether Plaintiffs have put forth enough evidence to establish the existence of a genuine issue of material fact regarding a valid assignment. This Court finds that Plaintiffs have not.
Owl offers the following evidence to show that a valid assignment does not exist:
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