Vinifera Imports Ltd. v. Societa Agricola Castello Romitorio SRL
| Decision Date | 12 March 2020 |
| Docket Number | 2:16-cv-00103 (ADS)(ARL) |
| Parties | VINIFERA IMPORTS LTD., Plaintiff, v. SOCIETA AGRICOLA CASTELLO ROMITORIO SRL, Defendant. SOCIETA AGRICOLA CASTELLO ROMITORIO SRL, Counter-Claimant, v. VINIFERA IMPORTS LTD., Counter-Defendant. |
| Court | U.S. District Court — Eastern District of New York |
APPEARANCES:
The Stolper Group, LLP
Attorneys for the Plaintiff and Counter-Defendant
New York, NY 10013
By: Michael T. Stolper, Esq., Of Counsel.
Rosenberg & Pittinsky, LLP
232 Madison Avenue Suite 906
New York, NY 10016
By: Lawrence D. Pittinsky, Esq., Of Counsel.
Plaintiff Vinifera Imports Ltd. (the "Plaintiff") brings this action against defendant Società Agricola Castello Romitorio SRL (the "Defendant") asserting causes of action for (1) breach of contract; (2) breach of the covenant of good faith and fair dealing; (3) quantum meruit; (4) unjust enrichment; and (5) promissory estoppel stemming from the Defendant's termination of an alleged ten-year exclusive distribution agreement.
The Defendant asserts two counterclaims for (1) tortious interference with business relationship and (2) tortious interference with contract based on the Plaintiff's threatening of legal action against a third-party with whom the Defendant sought to start a new distribution arrangement.
Presently before the Court is the Defendant's motion for summary judgment against the Plaintiff's claims and in favor of its counterclaims pursuant to Federal Rule of Civil Procedure ("Fed. R. Civ. P." or "Rule") 56. For the following reasons, the Court grants the Defendant's motion with respect to the Plaintiff's claim for breach of the covenant of good faith and fair dealing and the Plaintiff's demand for lost profits under the theory of promissory estoppel. The Court denies the Defendant's motion in all other respects.
The Plaintiff is a Long Island-based importer and distributor of Italian wines in the United States. The Defendant produces, bottles and sells Italian wine under the brand and label of Castello Romitorio from its winery located in Montalcino, Italy. The Plaintiff imported the Defendant's wine from 2007 to 2015. This case arises from the collapse of their distribution arrangement.
The parties assert two drastically different visions of their relationship. In the Plaintiff's view, both parties cooperated under the mutual goal to sell as much wine as possible for the highest profit. ECF 89-1 ¶ 10. According to the Plaintiff, the Defendant made the Plaintiff its exclusive distributor in 2007 to replace various smaller distributors, out of dissatisfaction with the sales volume driven by those distributors. Id. ¶ 2. Based on this exclusive relationship, thePlaintiff invested significant time and money to develop a market for the Defendant's product. Id. ¶ 9. On the other hand, the Defendant believes that the Plaintiff purchased and imported the wine into the United States for the purpose of independently reselling and distributing the wine for its own profit. According to the Defendant, the parties were under no continuing obligation to transact with each other and shared no mutual goals. ECF 85-1 ¶ 7. In that sense, the Defendant argues that the Plaintiff was not a "middle person" who acted on the Defendant's behalf, but rather imported and sold the wine at its own benefit, at the price of its choosing and maintained its own inventory. ECF 85-16 at 56:12-15, 103:16-21, 138:4-14, 204:10-208:4, 260:4-261:2.
The parties had no written agreement articulating the specifics of their distribution arrangement, such as the sale and purchase of the wine; the importing of the wine; the resale and distribution of the wine; the marketing and promotion of the wine; the parties' course of conduct; or their rights upon default or termination. Instead, the Plaintiff handled orders on an annual basis, agreeing to pricing, quantity and payment terms after each vintage was bottled and tested. ECF 89-1 ¶ 6; ECF 85-1 ¶ 8; ECF 85-16 at 174:4-7.
In the beginning of their relationship, the Plaintiff requested a letter from the Defendant that would be given to the "government." ECF 85-16 at 99:2-23. Two employees of the Plaintiff wrote to the Defendant requesting a "Letter of Appointment" for the "Federal approval board" and a "Letter of Authorization."
On or about October 8, 2007, the Defendant provided the requested letter which contained verbatim the language that had been provided by the Plaintiff. ("October 2007 Letter"). ECF 85-1 ¶¶ 28-31; ECF 85-7; ECF 85-8; ECF 85-9. The October 2007 Letter stated:
In 2010, after the parties agreed to carve out Ohio and Missouri from the Plaintiff's exclusive territory, the Defendant provided the Plaintiff an updated letter ("July 2010 Letter"). ECF 85-1 ¶¶ 32-33. The July 2010 Letter stated:
On October 22, 2012, the Plaintiff sent an e-mail that attached a sample contract it had with another Italian winery, Brigaldara, for an exclusive period. ECF 89-1 ¶ 12; ECF 89-5 at 1. The Plaintiff told the Defendant that the Plaintiff needed the Defendant to sign and send the Plaintiff the same single page document if it wanted the Plaintiff to continue as its importer in the United States. ECF 89-1 ¶ 12; ECF 89-5 at 1. The Defendant agreed. ECF 89-1 ¶ 12; ECF 89-5 at 1.
On November 21, 2012, the Defendant returned the document on its letterhead (the "November 2012 Letter") with a cover e-mail stating: "Please find attached a copy of the contract." ECF 89-5 at 2. The November 2012 Letter stated:
The parties dispute the origin and meaning of the October 22, 2012 e-mail and the November 2012 Letter. In the Plaintiff's view, the Defendant sent the document to memorialize their agreement that the Plaintiff was entitled to a ten-year exclusivity period. ECF 89-1 ¶ 11. According to the Plaintiff, the parties came to the agreement in a meeting between Domenic Nocerino Sr. ("Nocerino"), the founder and owner of the Plaintiff, and Filippo Chia, a co-owner of the Defendant, scheduled after the Plaintiff discovered that the Defendant sold a large order of wine to another distributor. Id. ¶ 11. During the meeting, Nocerino threatened to terminate the relationship unless the Defendant provided a written assurance of a ten-year exclusivity period. Id. ¶ 11. The Defendant does not contest that this meeting occurred, but disagrees about the substance of Nocerino and Chia's conversation. The Defendant characterizes the documents as merely confirmation that, if the parties' relationship ended, the Plaintiff could continue to sell its inventory of the Defendant's wine. The Defendant contends that the Plaintiff never voiced its opinion that the parties had an exclusive agreement until after the parties' relationship ended. ECF 85-1 ¶¶ 13-15.
After the November 2012 Letter, business as usual continued until May 2015, when a dispute over payment terms arose. ECF 89-1 ¶ 20. The Defendant wrote to the Plaintiff demanding payment every 90-days, rather than the six month payment period previously used, as well as price increases by as much as 50%. Id. ¶ 20. The Plaintiff responded that the proposed changes would make it impossible for the Plaintiff to sell the Defendant's wine economically. The parties did not speak again until September 20, 2015, when Nocerino wrote to ask Chia when he would be in New York so the parties could discuss their business. Id. ¶ 21.
In October 2015, Nocerino met with Chia at the Plaintiff's headquarters in Ronkonkoma, New York. Id. ¶ 22, during which Chia informed Nocerino that the Defendant had found another distributor. Id. ¶ 22. The Defendant argues that it terminated the arrangement due to the tense relationship between Nocerino and Chia; how the Plaintiff conducted business; lack of performance; weak or lack of marketing and distribution of the Defendant's wines; inconsistent and late orders for wine; and late and unpredictable payments of invoices. ECF 85-16 ¶ 16. On the other hand, the Plaintiff argues that the Defendant never contacted it with complaints about performance. ECF 89-1 ¶ 21.
On October 14, 2015, the Plaintiff received a letter from the Defendant seeking to terminate the parties' relationship. This letter stated that Defendant had decided to terminate the Plaintiff as its importer of wines in the United States, effective October 14, 2015. Id. ¶ 23. The Plaintiff was "directed and instructed to cease any representation, sale, distribution, advertising or importing" of the Defendant's wines effective October 14, 2015, with the exception of wines the Plaintiff already had in its inventory. Id. ¶ 23.
After the Defendant sent the termination letter, it replaced the Plaintiff as its importer with Mionetto USA ("Mionetto"), a wine importing company located in White Plains, New York. Id. ¶ 24. In November and December 2015, Nocerino and the Plaintiff's then-counsel contacted Mionetto, claiming that the Plaintiff had an exclusive import and distribution contract with the Defendant and threatening legal action against Mionetto. ECF 85-17. As a result of the letter, Mionetto placed its contract with the Defendant on hold and then terminated its relationship with the Defendant by refusing to proceed with the contract in its entirety. ECF 85-1 ¶ 58;...
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