Ryko Mfg. Co. v. Nationwide Wash Sys., Inc.
| Decision Date | 08 September 2010 |
| Docket Number | No. 4:09-cv-00182,4:09-cv-00182 |
| Citation | 736 F.Supp.2d 1226 |
| Parties | RYKO MANUFACTURING CO., Plaintiff/ Counterclaim Defendant, v. NATIONWIDE WASH SYSTEMS, INC., Defendant/ Counterclaim Plaintiff. |
| Court | U.S. District Court — Southern District of Iowa |
Jan Mohrfeld Kramer, Smith & Kramer PC, Des Moines, IA, for Plaintiff/Counterclaim Defendant.
R. Jeffrey Lewis, Kimberly Pieters Knoshaug, Lewis Webster Van Winkle & Knoshaug LLP, Des Moines, IA, for Defendant/ Counterclaim Plaintiff.
Before the Court is Nationwide Wash Systems, Inc.'s ("Nationwide") Motion for Partial Summary Judgment, filed June 10, 2010. Clerk's No. 12. Ryko Manufacturing Co. ("Ryko") filed a Resistance to Nationwide's Motion on July 13, 2010. Clerk's No. 15. Nationwide filed a Reply on August 2, 2010. Clerk's No. 18. Though Nationwide has requested a hearing, the Court does not believe oral argument would substantially aid it in resolving the present motion. Accordingly, the matter is fully submitted.
On May 5, 2009, Ryko filed a two-count Complaint against Nationwide. Clerk's No. 1. In the first count of the Complaint, Ryko alleges that Nationwide failed to pay for goods and merchandise purchased from Ryko on account. See id. In the second count of the Complaint, Ryko seeks declaratory judgment on the question of whether Ryko owes Nationwide "rebates" (also referred to as "commissions") under the terms of a written, non-exclusive Distributorship Agreement, which the parties entered into on January 1, 2008 (the "2008 Agreement"). Id. Nationwide filed an Answer to Ryko's Complaint on June 12, 2009. Clerk's No. 4. On June 26, 2009, Nationwide filed a six-count Counterclaim against Ryko, asserting that Ryko is liable for: 1) breach of contract; 2) breach of the duty of good faith; 3) breach of oral contract; 4) open account; 5) account stated; and 6) unjust enrichment. Clerk's No. 5.
In the present Motion for Partial Summary Judgment, Nationwide contends that there "are two contractual payments that Ryko owes to Nationwide as a matter of law under the terms of the [2008 Agreement]." Def.'s Mot. at 2. First, Nationwide contends that Ryko has failed to pay it certain "rebates" owed under the terms of the 2008 Agreement. Id. Second, Nationwide contends that Ryko has failed to credit it with a $25,000.00 payment, pursuant to paragraph 21 of the 2008 Agreement. Id. Ryko strongly opposes Nationwide's claims of entitlement to partial summary judgment, for reasons to be discussed in detail, infra.
Ryko is an Iowa corporation engaged in the business of manufacturing and selling motor vehicle washing equipment. Nationwide's Statement of Material Facts (hereinafter "Def.'s Facts") ¶¶ 2-3. Nationwide is a Minnesota corporation engaged in the installation and service of motor vehicle car wash systems. Id. ¶¶ 1, 4. Ryko and Nationwide have had a business relationship dating back to 1979, whereby Nationwide operated as a Ryko Distributor, i.e., Nationwide would purchase equipment from Ryko at distributor prices, and then resell that equipment for customers to use in automatic car washes.1Id. ¶ 11; Ryko's Statement of Additional Material Facts (hereinafter "Pl.'s Facts") ¶ 2. Over the years, the parties' business relationship has been governed by various contracts. Pl.'s Facts ¶ 12. Though the present lawsuit directly concerns only the 2008 Agreement, several prior aspects of the parties' business relationship are relevant.
According to Nationwide, in 1990, after seven years of meetings and social contacts, Valerie Adams Kreager ("Kreager") successfully solicited the corporate account of Holiday Companies, Inc. ("Holiday").2 Def.'s Facts ¶¶ 14-15. Pursuant to the parties' various agreements, including the 2008 Agreement, Holiday was a "national account," 3 meaning that Ryko products were sold to Holiday directly by Ryko, and not through a distributor such as Nationwide. Pl.'s Facts ¶ 4. Though Nationwide was prohibited from selling directly to Holiday, the parties had, over the years, an agreement whereby Ryko would pay Nationwide "rebates" or "commissions" related to sales to certain national account customers like Holiday. Id. ¶ 10.
From April 2006 to December 31, 2007, the parties' relationship was governed by a Distributorship Agreement (the "2006 Agreement"). Id. ¶ 13. At the time the parties entered into the 2006 Agreement, there existed a dispute between Ryko and Nationwide related to Nationwide's account with Ryko for car wash equipment parts, and related to Nationwide's claims for payments alleged to be due from Ryko for performing warranty services. Id. ¶ 14. The dispute was resolved by including in the 2006 Agreement a $25,000.00 credit to Nationwide's parts account, in full settlement of all outstanding disputes between Nationwide and Ryko.4 Id. ¶ 15. In December 2007, while the 2006 Agreement was in effect, Holiday purchased ten Ryko car wash systems, prepaying the price of the systems in order to obtain additional pricing discounts. Def.'s Facts ¶ 16. Throughout the spring and summer of 2008, Nationwide installed the car wash systems at various Holiday locations in the State of Minnesota. Id. Following Nationwide's installation of the equipment, Ryko paid rebates to Nationwide, pursuant to the terms of the 2006 Agreement. Id. ¶ 17.
On January 1, 2008, Nationwide and Ryko entered into the 2008 Agreement, whereby Nationwide again agreed to be a distributor of Ryko car wash equipment. Id. ¶¶ 5-6. The 2008 Agreement was substantially identical to the 2006 Agreement, and though the parties did not discuss or negotiate the matter, the 2008 Agreement contained the same provision providing for a $25,000.00 credit to Nationwide in settlement of all disputes then existing between the parties. Pl.'s Facts ¶¶ 18-19. Ryko contends that there were no disputes between the parties at the time they entered into the 2008 Agreement, and that the $25,000.00 credit provision was included by mistake. Id. ¶ 19. Nationwide counters that the inclusion of the provision in the 2008 Agreement demonstrates the intent of the parties to include it, though Nationwide admits that, prior to the filing of its counterclaim in this case, it had neverclaimed that Ryko owed it a $25,000.00 credit under the terms of the 2008 Agreement. 5Id. ¶ 20; Def.'s Resp. to Pl.'s Facts ¶ 18. Though the 2008 Agreement was set to expire on December 31, 2008, the parties extended it until March 31, 2009. Def.'s Facts ¶¶ 7-8. Beginning March 31, 2009, however, Nationwide declined to enter into any further contractual arrangements with Ryko. Id. ¶ 9.
In May 2008, while the 2008 Agreement was in effect, Holiday again entered into an Equipment Supply Agreement with Ryko for the purchase of Ryko car wash systems. Id. ¶ 18. Ryko provided Nationwide with a copy of that agreement, under which Holiday pre-paid Ryko for ten car wash systems in December 2008. Id. ¶¶ 18-19. Holiday entered into a separate agreement with Nationwide to install the ten car wash systems at Holiday locations in Minnesota, North Dakota, and Michigan, and to provide warranty service on them. Id. ¶¶ 20-22, 24; Pl.'s Resp. to Def.'s Facts ¶ 20. Nationwide completed installation on nine out of ten of the car wash systems by December 2009. Def.'s Facts ¶¶ 23-24. Despite the fact that the parties' contract had expired several months previously, after installing the car wash systems, Nationwide sent Ryko invoices for "rebates" it claimed Ryko owed it in relation to Holiday's purchase of the car wash systems. Id. ¶ 25. Ryko has refused to pay the rebates, taking the position that no rebates are owed to Nationwide since the 2008 Agreement expired prior to Nationwide's installation of the car wash systems. Id. ¶ 25 (second).6
The term "summary judgment" is something of a misnomer.7See D. Brock Hornby, Summary Judgment Without Illusions, 13 Green Bag 2d 273 (Spring 2010). It "suggests a judicial process that is simple, abbreviated, and inexpensive," while in reality, the process is complicated, time-consuming, and expensive. Id. at 273, 281. The complexity of the process, however, reflects the "complexity of law and life." Id. at 281. "Since the constitutional right to jury trial is at stake," judges must engage in a "paper-intensive and often tedious" process to "assiduously avoid deciding disputed facts or inferences" in a quest to determine whether a record contains genuine factual disputes that necessitate a trial. Id. at 281-82. Despite the seeming inaptness of the name, and the desire for some in the plaintiffs' bar to be rid of it, the summary judgment process is well-accepted and appears "here to stay." 8Id. at 281. Indeed, "judges are duty-bound to resolve legal disputes, no matter how close the call." Id. at 287.
Federal Rule of Civil Procedure 56(b) provides that "[a] party against whom relief is sought may move at any time ... for summary judgment on all or part of the claim." "[S]ummary judgment is an extreme remedy, and one which is not to be granted unless the movant has established his right to a judgment with such clarity as to leave no room for controversy and that the other party is not entitled to recover under any discernible circumstances." Robert Johnson Grain Co. v. Chem. Interchange Co., 541 F.2d 207, 209 (8th Cir.1976) (citing Windsor v. Bethesda Gen. Hosp., 523 F.2d 891, 893 n. 5 (8th Cir.1975)). The purpose of summary judgment is not "to cut litigants off from their right of trial by jury if they really have issues to try." Poller v. Columbia Broad. Sys., Inc., 368 U.S. 464, 467, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962) (quoting Sartor v. Ark. Natural Gas Corp., 321 U.S. 620, 627, 64 S.Ct. 724, 88 L.Ed. 967 (1944)). Rather, it is designed to avoid "useless, expensive and time-consuming trials where there is actually no genuine, factual issue remaining to be tried." Anderson v. Viking Pump Div., Houdaille Indus., Inc., 545...
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