Shutter Shop, Inc. v. Amersham Corp., CIV. A. 99-D-1279-N.

• Decision Date: 11 September 2000
• Docket Number: No. CIV. A. 99-D-1279-N.,CIV. A. 99-D-1279-N.
• Citation: 114 F.Supp.2d 1218
• Parties: THE SHUTTER SHOP, INC., Plaintiff, v. AMERSHAM CORP., Defendant.
• Court: U.S. District Court — Middle District of Alabama

114 F.Supp.2d 1218

THE SHUTTER SHOP, INC., Plaintiff, v. AMERSHAM CORP., Defendant.

No. CIV. A. 99-D-1279-N.

United States District Court, M.D. Alabama, Northern Division.

September 11, 2000.

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Russell T. Duraski, James M. Sizemore, Jr., Montgomery, AL, for plaintiff.

Richard E. Broughton, Ball, Ball, Matthews & Novak, P.A., Montgomery, AL, for defendant.

MEMORANDUM OPINION AND ORDER

DE MENT, District Judge.

Before the court is Defendant Amersham Corporation's ("THH" or "Defendant") Motion For Summary Judgment ("Def.Mot.Summ. J."), together with a supporting Brief, which were both filed July 14, 2000. Plaintiff The Shutter Shop ("Plaintiff") filed its Response ("Pl.'s Resp.") on August 4, 2000. Defendant then filed a Reply ("Reply") on August 11, 2000. After careful consideration of the arguments of counsel, the relevant law, and the record as a whole, the court finds that Defendant's Motion is due to be granted in part and denied in part.

I. JURISDICTION AND VENUE

The court properly exercises subject matter jurisdiction over this action pursuant to 28 U.S.C. § 1332 (diversity jurisdiction). Neither party contests personal jurisdiction or venue.

II. FACTUAL BACKGROUND

At the heart of this case is a dispute over whether the products bought were the products sold. In 1988, Richard Feaga ("Feaga") and his wife, Susan, founded The Shutter Shop, Inc., a small business in Montgomery that sells and installs plantation shutters on homes and businesses throughout central Alabama. (Feaga's Dep. at 18-19.) The shutter frames are held in place with magnets that are purchased separately and attached to the inside of the shutters. Feaga or his employees attach the magnets themselves by running screws through a hole they drill in the foot of the plastic casing surrounding the magnet. (Id. at 77-78; Frazier's Dep. at 46.)

Ever since opening The Shutter Shop, Feaga purchased magnets and other shutter equipment from Amersham Corporation, which does business under the name of Terry Hinge and Hardware Company. (Feaga's Dep. at 33.) Feaga selected the magnets from THH's catalog and placed his orders several times a year via telephone, speaking to a THH employee named Dave each time. (Id. at 56.) Feaga always purchased the magnet identified by THH's catalog as "M03-03944." The catalog described the magnet's size, shape, and pulling power. It also displayed a picture of the magnet, the top of which bore a stamped imprint reading "Supec 12." (Id. at 44-48; Def. Ex. 9).

When Feaga ordered magnets, he always referred to the magnet's product number, because "[THH] always want[s] a product number; that's all they care about." (Feaga's Dep. at 44-46, 56.) Thus, he never explicitly stated that he wanted a "Supec 12" magnet. Similarly, he never informed Dave that he needed magnets with plastic casing of a certain durability or flexibility. He also never described The Shutter Shop's process of drilling holes in the bottom of the magnets prior to installation. However, on several occasions, he told Dave that he needed a magnet with a certain size, shape, and pulling power. (Id. at 52-56, 140.)

Each shipment of M03-03944 magnets — in terms of size, shape, pulling power, and plastic casing — was consistent with the previous shipment. (Id. at 52; Feaga Aff.) The magnet's performance satisfied Feaga at all times between 1988 and May 1997. He was especially pleased with how the magnet held in place the shutters he attached to homes and businesses. (Feaga Aff.)

In May 1997, without informing its customers, THH obtained a new supplier for the magnets identified as product M03-03944. (Def. Mot. Summ. J. at 2.) Despite changing suppliers, THH did not change its description of the magnets in either its catalog, invoice slips, or product numbers. It continued to use the same product number and invoice number to identify the magnets, and its catalog still depicted product M03-03944 as a magnet bearing the imprint "Supec 12." (Feaga's Dep. at 44; Def. Ex. 7, 9.)

Feaga telephoned THH in May or June 1997 and — without knowledge of the change in suppliers — ordered another batch of M03-03944 magnets. After receiving the magnets, which were now supplied by Velvet Industries, Feaga noticed that they no longer had the words "Supec 12" stamped on them.¹ (Feaga's Dep. at 53-56; Def. Mot. Summ. J. at 2.) The new magnets also responded differently to Feaga's efforts to drive screws into them. Sometimes the plastic casing would become indented or depressed, and other times the screw would go completely through the casing unless Feaga changed the clutch setting on his equipment. Feaga pointed out these differences to his employees, but he continued using the magnets as part of his normal business operations and did not attempt to return them. (Feaga's Dep. at 56-57; Frazier's Dep. at 45-47.)

At some point after receiving this shipment, Feaga called THH to order additional magnets. During this phone conversation, Feaga spoke with Dave and asked whether the M03-03944 magnets he had been purchasing were the same as those THH had previously supplied. (Feaga's Dep. at 44-45, 56.) Feaga also asked Dave, "in passing," whether there were "any differences" between the magnets he received in May or June 1997 and those he received prior to that date. (Id. at 53-57.) In response, Dave stated that the Supec 12 magnets were no longer being manufactured and were unavailable, that the Velvet magnets were manufactured in Italy, and that they were "just as good or supposed to be just as good" as the Supec 12s. (Id. at 54-55.)²

The precise time when Feaga contacted THH and asked about differences between the Supec 12 magnet and the Velvet magnets is unknown. It is also unclear how many times, if any, Feaga ordered magnets between May 1997 and when he received this information. (Id. at 53-56.)

In any event, it is clear that Feaga continued to purchase magnets periodically from THH, after being appraised that THH had changed suppliers. He eventually purchased a total of 11,700 Velvet magnets from THH between June 1997 and May 1999. (Def.Ex. 8.) Possibly as early as January 1999, approximately 18 months after The Shutter Shop had received the first shipment of Velvet magnets, some of Feaga's customers began to report that the plastic casing around the foot of the Velvet magnets was breaking. (Reply at 1; Feaga's Dep. at 77-78.)³ As a result, the magnets could not support properly the shutters to which they were attached, and the shutters began falling off the homes and businesses of Feaga's customers.

In June 1999, when Feaga informed THH about problems he was having with the Velvet magnets, THH offered to replace the 500 Velvet magnets he had on hand. (Feaga's Dep. at 108.) THH also told him that the Supec 12 magnets were, in fact, available for purchase. (Id. at 114.)

The reverse side of THH's invoices contains a warranty, a disclaimer of all other warranties, and a limitation of damages provision. The limitation, which is printed in bold font, provides that THH will only replace defective products or refund the seller's purchase price if the seller is unsatisfied. (Def.Ex. 6, 7). The invoice accompanied all shipments of products to The Shutter Shop. Feaga had an opportunity to read the invoices, warranties, and disclaimers. He never objected to them. (Feaga's Dep. at 92-100.)

On behalf of The Shutter Shop, Feaga subsequently filed this action in Alabama state court. The Shutter Shop brings tort law claims of fraudulent suppression and misrepresentation, as well as contract law claims for breach of express warranty and implied warranty of merchantability. THH removed on the basis of diversity. See 28 U.S.C. § 1332.

III. SUMMARY JUDGMENT STANDARD

When considering a motion for summary judgment, the court construes the evidence and makes factual inferences in the light most favorable to the nonmoving party. See Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). Summary judgment is entered only if it is shown "that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." FED. R. CIV. P. 56(c).

At this juncture, the court does not "weigh the evidence and determine the truth of the matter," but solely "determine[s] whether there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (citations omitted). The determination involves applying substantive law to the substantive facts that have been developed. A dispute about a material fact is genuine if a reasonable jury could return a verdict for the nonmoving party, based on the applicable law in relation with the evidence developed. See Anderson, 477 U.S. at 248, 106 S.Ct. 2505; Barfield v. Brierton, 883 F.2d 923, 933 (11th Cir.1989).

The moving party bears the initial burden of establishing the absence of a genuine issue of material fact. Celotex, 477 U.S. at 323, 106 S.Ct. 2548. The movant must inform the court of the basis for the motion and establish, based on relevant "portions of `the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,'" that there is no genuine issue of material fact. Id. at 322-23, 106 S.Ct. 2548 (citing FED. R. CIV. P. 56(c)). The moving party may satisfy this burden in two ways: (1) by presenting evidence that negates an essential element of the nonmoving party's case; or (2) by demonstrating that the non-moving party failed to produce sufficient evidence to establish an essential element of the case on which that party will ultimately bear the burden of proof. See id.

After such a showing, the burden of production shifts to the nonmoving party, which must "go beyond the pleadings and by her own affidavits, or by the ...