Tindall Corp. v. Mondelez Int'l, Inc.

• Decision Date: 29 March 2017
• Docket Number: No. 14 C 05196.,14 C 05196.
• Citation: 248 F.Supp.3d 895
• Parties: TINDALL CORPORATION, Plaintiff, v. MONDELEZ INTERNATIONAL, INC., Defendant.
• Court: U.S. District Court — Northern District of Illinois

248 F.Supp.3d 895

TINDALL CORPORATION, Plaintiff,

v.MONDELEZ INTERNATIONAL, INC., Defendant.

No. 14 C 05196.

United States District Court, N.D. Illinois, Eastern Division.

Signed March 29, 2017

Brad Christopher Parrott, Mary Lillian Walker, Kevin H. Hudson, Zachary Richard Hall, Hudson Parrott Walker, LLC, Atlanta, GA, Jennifer Ann Nielsen, Lyman & Nielsen, LLC, Westmont, IL, Nicholas Jerome Johnson, Lyman & Nielsen, LLC, Oak Brook, IL, for Plaintiff.

Chalana N. Williams, Daniel T. Campbell, Michael Wyld Lieberman, Nathiya Nagendra, Crowell & Moring, LLP, Washington, DC, Daniel William McGrath, David F. Nightingale, Joel David Bertocchi, Hinshaw and Culbertson LLP, Chicago, IL, for Defendant.

MEMORANDUM OPINION AND ORDER

Honorable Edmond E. Chang, United States District Judge

This case illustrates that if a company wants to make sure that it has a real deal with another company—especially a multi-million dollar deal—put it in writing.¹ Not just emails, but a formal, written agreement. Tindall Corporation brought this lawsuit against food-and-beverage conglomerate Mondelez International, alleging breach of contract and promissory estoppel. R. 14, Am. Compl.² Tindall claims that Mondelez awarded it a multi-million dollar contract to engineer, fabricate, and deliver precast concrete for the construction of a Mondelez factory in Mexico—only for Mondelez to break its word and give the work to another company. Id. But Mondelez disputes that the parties ever came to an agreement. Instead, Mondelez contends, the parties engaged in negotiations, those negotiations fizzled, and Tindall is now trying to lay claim to money that it is not owed. R. 85, Def.'s Mot. for Summ. J. Mondelez now moves for summary judgment. Id. For the reasons discussed below, the motion is granted.

I. Background

In deciding Mondelez's motion for summary judgment, the Court views the evidence in the light most favorable to the non-moving party, Tindall. Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).

A. Project Arthur

In early 2012, Mondelez International decided to construct a new, large-scale industrial bakery. R. 87, DSOF ¶¶ 1, 6. It hired Stellar Group, a construction management company based in Florida, to help with the project, dubbed "Project Arthur." Id. ¶ 1, 6. Stellar's role was to assist in the development of a project floor plan, site plan, budget and schedule. Id. ¶ 6.

Stellar was also responsible for vetting companies to perform the project's precast work. See DSOF ¶ 7. Precast work involves designing and fabricating concrete at a manufacturing facility, and then assembling the pieces at the construction site. Id. ¶ 8. If the manufacturing facility is near the construction site, then the precast pieces only need to be moved a short distance. R. 99, Pl.'s Resp. DSOF ¶ 8. But if the facility is far away—as is sometimes the case—arrangements must be made to transport the pieces over that distance. DSOF ¶ 8. The alternative to precast concrete is cast-in-place concrete. Id. There, a small concrete facility is set up on the construction site, and the concrete is poured directly into place. Id.

In April 2012, Stellar contacted several companies and asked them to submit proposals for various precast items for Project Arthur. DSOF ¶ 7; Pl.'s Resp. DSOF ¶ 7. One of those companies was Tindall Corporation, a precast concrete manufacturer based in South Carolina. Id. ¶ 3. Tindall submitted its initial proposal for precast fabrication in May 2012. DSOF ¶ 9; R. 88–5, DSOF at Exh. 5, May Proposal. The May Proposal identified a "Base Proposal Scope of Work," priced at $9,734,000 and two "Alternates," potential add-on packages that were priced $6,647,200 and $4,782,200. May Proposal; Pl.'s Resp. DSOF ¶ 9. Tindall proposed to produce the precast at its plant in San Antonio, Texas. DSOF ¶ 11.

From July 2012 to November 2012, Chris Palumbo, Tindall's Vice President for Business Development, regularly discussed the project with Stellar. R. 100, PSOF ¶ 2; R. 101, Palumbo Aff. ¶ 5. Palumbo provided Stellar with information that they had requested about precast engineering, pricing, and scheduling. PSOF ¶ 2.

The relationship continued to progress as the year drew to a close. Palumbo submitted a revised precast budget to Michael Smith, Stellar's Director of Project Development, in October 2012, PSOF ¶ 3, and Stellar representatives visited Tindall's San Antonio plant in November to vet the facility, id. ¶ 5. Shortly afterwards, Tindall representatives travelled with Stellar to Mexico, where Mondelez had decided to build Project Arthur. Id. As of this point, Tindall had dealt exclusively with Stellar; although a Mondelez representative was scheduled to join the November trip to Tindall's San Antonio plant, he had to pull out due to illness. Id.

Around this time, Tindall also started talking to Stellar about providing the precast engineering services for Project Arthur, on top of the precast manufacturing. DSOF ¶ 71. On November 26, Tindall submitted an initial proposal to provide the engineering services for $75,000. DSOF ¶ 72; R. 88–10, DSOF at Exh. 10. This proposal was later updated in February 2013 and March 2013. DSOF ¶ 72; R. 88–19; DSOF at Exh. 19; R. 89–1, DSOF at Exh. 21.

In December 2012, Tindall submitted a formal bid to provide precast design, fabrication, and delivery for Project Arthur for the lump-sum price of $23,269,600. DSOF ¶ 15; PSOF ¶ 6; R. 100–9, PSOF at Exh. 9, Tindall Bid. Upon reviewing all of the bids it received, Stellar recommended to Mondelez that it "give the package to Tindall." DSOF ¶ 16. By March 2013, Stellar was hinting to Tindall that it would soon receive the contract from Mondelez. PSOF ¶ 11.

B. The March 20 Meeting

Tindall and Mondelez had their first direct contact on March 20, 2013, at a meeting at Stellar's headquarters in Jacksonville, Florida (call it the "March 20 Meeting"). DSOF ¶ 21. Tindall was represented by Palumbo, and Mondelez by Carlos Nicot, the Project Arthur Procurement Lead. Id. Michael Smith also attended the meeting. Id.

Tindall alleges that, during this meeting, Palumbo and Nicot entered into an oral agreement. Palumbo testified that Nicot awarded Tindall a precast engineering, fabrication, and delivery contract and directed Tindall to reserve capacity in the San Antonio factory for Project Arthur. PSOF ¶ 14. Palumbo further testified that he and Nicot "agreed to the price, the scope, our concessions, [and] the schedule" of the work. Id. Specifically, Palumbo averred that, towards the end of the meeting, Nicot said something along the lines of "I can work with you guys. I know I can work with you guys," which Palumbo took as his assent to the terms discussed that day. DSOF ¶ 22.

Nicot disputes that he offered the precast contract to Tindall, entered into any agreements, or directed Tindall to reserve capacity. R. 110, Def.'s Resp. PSOF ¶ 14. He admits, however, that he and Palumbo discussed Alternates (the potential add-on packages) and that he authorized Stellar to pay Tindall $177,000 for precast engineering services. Id.

C. The March 21 Emails

The next day, Palumbo and Nicot exchanged a series of emails that will be central to this outcome of this case. DSOF ¶ 26; R. 89–2, DSOF at Exh. 22, March 21 Emails. Palumbo kicked off the chain with an email to Nicot, copying Smith, with the subject line, "Project Arthur—Tindall Precast—Recap of March 20 2013 meeting—next steps" (call this email the "Palumbo Email"). March 21 Emails. In the body, Palumbo wrote: "Carlos—Thank you for your time yesterday. Below is my understanding of our discussion regarding an agreement for Project Arthur precast scope and next steps." Id. He then listed a number of "Items," consisting of what he believed to be agreed terms, as well as scheduling notes and action items:

1. Tindall will use the December 14, 2012 proposal as a base scope for purposes of our agreement.

2. Tindall and Stellar identified a number of changes and associated added costs and deductions to the December 14 scope. Stellar provided a summary the (sic) base cost and changes to date during our meeting.

3. Tindall has received the latest project drawings as of March 20, 2013 and will validate the scope of the precast and all changes and values no later than April 29, 2013.

4. The March 20, 2013 documents will become the basis for Tindall/Mondelez precast supply agreement and price.

5. As part of the overall contract, Tindall will provide the first $200,000 of accepted changes to the scope at no cost to the project.

6. Tindall will reduce the proposed $477,000 engineering fee by $300,000 to $177,000 plus reimbursable expenses.

7. Tindall will provide storage of manufactured product at Tindall's San Antonio plant for a maximum of two months at no cost. Tindall will charge $250 per piece per month for any precast stored more than two months at our plant.

8. Tindall has included a total of $305,000 in our price for our field services on-site during construction. The services include two Tindall personnel on-site during delivery and erection of the precast structure in addition to four local personnel to support any field adjustments necessary to the precast. Tindall will agree to pass through the actual cost of salaries for these employees and contract labor and expenses without the addition of any overhead & profit.

9. Payments to Tindall will be in US dollars.

10. Mondelez plans to assign the Tindall contract to the project General Contractor, Copachisa. Copachisa will be responsible for payment to Tindall net 60 days.

11. Mondelez will guarantee payment of Tindall's contract.

12. Carlos will provide email to Palumbo regarding Copachisa financial position and summary of review by Mondelez excluding any confidential information.

13. Mondelez will provide Tindall with a $3,000,000 down payment the day the contract for fabrication and delivery is executed.

14. Tindall will provide a bond for the $3,000,000 down payment. The cost

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