Waldo v. North American Van Lines, Inc.

• Decision Date: 04 September 1987
• Docket Number: Civ. A. No. 82-2668.
• Citation: 669 F. Supp. 722
• Parties: Francis J. WALDO, Plaintiff, v. NORTH AMERICAN VAN LINES, INC., Defendant.
• Court: U.S. District Court — Eastern District of Pennsylvania

669 F. Supp. 722

Francis J. WALDO, Plaintiff, v. NORTH AMERICAN VAN LINES, INC., Defendant.

Civ. A. No. 82-2668.

United States District Court, W.D. Pennsylvania.

September 4, 1987.

COPYRIGHT MATERIAL OMITTED

John T. Tierney III, Tarasi & Tighe P.C., Pittsburgh, Pa., John W. Pollins, III, Greensburg, Pa., for plaintiff.

David J. Armstrong, Dickie, McCamey & Chilcote, Pittsburgh, Pa., for defendant.

OPINION

COHILL, Chief Judge.

Presently before us is defendant's motion for summary judgment on all five counts of plaintiff's second amended complaint. Plaintiff, Francis J. Waldo, a former truck driver, brought this action against North American Van Lines, Inc. ("NAVL") for alleged violations of the Pennsylvania Unfair Trade Practices and Consumer Protection Law, 73 P.S. § 201-1 et seq.; Section 1 of the Sherman Act, 15 U.S.C. § 1; Section 3 of the Clayton Act, 15 U.S.C. § 14; Section 5 of the Federal Trade Commission Act, 15 U.S.C. § 45; the Racketeer Influenced and Corrupt Organization Act ("RICO"), 18 U.S.C. §§ 1961 — 1968; and common law fraud.

The underlying facts were extensively described in our earlier Opinion and Order denying plaintiff's motion for class certification. Waldo v. North American Van Lines, Inc., 102 F.R.D. 807, 809-10 (W.D. Pa.1984) ("Waldo I"). Briefly restated, the instant dispute arose from plaintiff's having entered into a business relationship with NAVL to become one of its truck drivers ("owner/operators"), which proved to be unprofitable. Plaintiff contends that NAVL made several misrepresentations to him and failed to disclose material facts which enticed him into joining NAVL's fleet of owner/operators. In essence, plaintiff alleges that NAVL over-recruited and under-utilized its drivers, which ultimately forced plaintiff to terminate his Operating Agreement. Additionally, plaintiff avers that NAVL violated federal antitrust laws by its practice of (1) tying the sale of insurance to its sale of trucks, as well as other tying claims, and (2) prohibiting its drivers from carrying loads for competitors when they are not doing so for defendant (i.e., "trip leasing").

Summary Judgment

When considering a motion for summary judgment, the Court must determine whether the pleadings, depositions, affidavits, answers to interrogatories, and admissions on file, when viewed in the light most favorable to the non-moving party, present a genuine issue as to any material fact. If not, the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). The materiality of a disputed fact is determined by looking to the substantive law of the case. Disputes over facts which will not affect the outcome of the case do not preclude summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, ____, 106 S.Ct. 2505, 2509, 91 L.Ed.2d 202, 211 (1986). At the summary judgment stage, "the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Id. at ___, 106 S.Ct. at 2511, 91 L.Ed.2d at 213.

The moving party bears the burden of proving that no genuine issue exists. Adickes v. Kress & Co., 398 U.S. 144, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). However, this burden can be discharged by merely pointing out the "absence of evidence to support the non-moving party's case." Celotex Corp. v. Catrett, 477 U.S. 317, ___, 106 S.Ct. 2548, 2554, 91 L.Ed.2d 265, 275 (1986). Once the moving party has met that burden, it becomes incumbent upon the nonmoving party "to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." 477 U.S. at ___, 106 S.Ct. at 2553, 91 L.Ed.2d at 273. Any doubts must be resolved in favor of the non-moving party. Gans v. Mundy, 762 F.2d 338, 341 (3d Cir.1985).

Discussion

I. Pennsylvania Unfair Trade Practices and Consumer Protection Law

Count One of plaintiff's amended complaint sets forth several alleged violations of the Pennsylvania Unfair Trade Practices and Consumer Protection Law ("CPL"), 73 P.S. § 201-1 et seq. which stem from plaintiff's purchase and lease back of a GMC tractor from defendant, coupled with the purchase of appropriate types of insurance from defendant. The gist of plaintiff's allegations is that the goods purchased did not conform to certain deceptive representations made by NAVL, and that the conduct of NAVL caused plaintiff to be confused and/or to misunderstand the nature of the transaction.

In support of its motion for summary judgment, defendant contends that a private action brought under the CPL is limited to "consumers of goods and services." Layton v. Liberty Mutual Fire Insurance Co., 530 F.Supp. 285, 286 (E.D.Pa.1981). Because plaintiff purchased the truck and insurance as part of a business venture, NAVL contends that he cannot bring an action under the CPL.

Pennsylvania courts have construed the remedial provisions of the CPL liberally. See, e.g., Commonwealth v. Monumental Properties, 459 Pa. 450, 457-60, 329 A.2d 812, 815-17 (1974); Pekular v. Eich, 355 Pa.Super. 276, 286-87, 513 A.2d 427, 432 (1986). However, § 201.9.2(a) of the CPL provides that a private action may only be brought by "any person who purchases or leases goods or services primarily for personal, family or household purposes...." The obvious intent of this language is to restrict claims brought under the CPL to those which are legitimately of a consumer nature. Here, plaintiff bought the tractor and the insurance coverage solely for use in his trucking business and, as such, they cannot qualify as consumer goods (i.e., food, clothes, household items and the like). The fact that plaintiff entered into a purchase and lease back arrangement with NAVL unequivocally establishes that he purchased the goods for a commercial purpose; he did not buy them to consume personally or with his family, but instead, purchased them to operate a business partnership with NAVL.

While our research has uncovered no Pennsylvania case squarely on point, we note that several cases from the Eastern District of Pennsylvania have limited the application of the CPL to consumer transactions. See Merv Swing Agency, Inc. v. Graham Co., 579 F.Supp. 429 (E.D.Pa. 1983); Zerpol Corp. v. DMP Corp., 561 F.Supp. 404 (E.D.Pa.1983); Klitzner Industries, Inc. v. H.K. James & Co., 535 F.Supp. 1249 (E.D.Pa.1982); Permagrain Products, Inc. v. U.S. Mat & Rubber Co., 489 F.Supp. 108 (E.D.Pa.1980). Plaintiff contends that these cases are inapposite, as they involved claims brought under the CPL by plaintiff-business entities which possessed equal bargaining power with the defendant-business entities and/or were direct competitors in the marketplace. We disagree with plaintiff's argument. Irrespective of any unequal bargaining power between the parties, plaintiff's sole motivation for purchasing the tractor and insurance from NAVL was to operate a business; this is not primarily a "personal, family or household purpose." We do not believe that the legislature intended the CPL to reach garden variety breach of contract or alleged fraud situations such as the one asserted here; neither of these parties is a "consumer" as that term is commonly understood. Thus, we will grant defendant's motion for summary judgment on Count One of plaintiff's amended complaint.

II. Federal Trade Commission Act Claim

While our earlier opinion in Waldo I dealt solely with the issue of class certification, we intimated then, see 102 F.R.D. at 811, and reiterate now, that section 5 of the Federal Trade Commission Act, 15 U.S.C. § 45, does not provide for a private right of action. See, e.g., Holloway v. Bristol-Meyers Corp., 485 F.2d 986 (D.C.Cir.1973) (private parties have no right of action to enforce provisions of FTC Act, which vests enforcement authority in administrative agency), Carlson v. Coca-Cola Co., 483 F.2d 279 (9th Cir.1973); Kaiser v. Dialist Company of Texas, 603 F.Supp. 110, 111 (W.D.Pa.1984). "A fair reading of the statute and its legislative history evinces a plain intent by Congress to make the administrative program for enforcing the Federal Trade Commission Act an exclusive one." Holloway, 485 F.2d at 1002. Moreover, the language of the FTC Act specifically provides an exception for "common carriers subject to the Acts to regulate commerce." 15 U.S.C. § 45(a)(2) (Supp. 1987). Consequently, defendant's motion for summary judgment relating to plaintiff's failure to state a claim under the FTC Act will be granted.

III. Antitrust Claims

Plaintiff has also alleged that NAVL violated the federal antitrust laws in several respects. While the standard for summary judgment does not differ from other cases in the antitrust context, the Supreme Court has cautioned that courts should tread carefully where motive and intent are important issues. Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962) ("summary procedures should be used sparingly in complex antitrust litigation where motive and intent play leading roles, the proof is largely in the hands of the alleged conspirators, and hostile witnesses thicken the plot.") However, as in other cases, summary judgment will be granted in the "absence of any significant probative evidence tending to support the complaint." First National Bank of Arizona v. Cities Service Co., 391 U.S. 253, 290, 88 S.Ct. 1575, 1593, 20 L.Ed.2d 569 (1968). See also Arnold Pontiac-GMC v. General Motors Corp., 786 F.2d 564, 572 (3d Cir.1986). As we noted earlier, our inquiry is limited to determining whether a genuine issue of material fact exists in the present record. Celotex, supra.

A. Tying Arrangements

1. Insurance Tied to Tractor

In connection with plaintiff's consumer fraud claim at Count One, plaintiff alleges that NAVL illegally tied the purchase of insurance to the purchase of plaintiff's GMC tractor. In Waldo I, we noted that three...