Wayman v. Amoco Oil Co.
| Decision Date | 23 February 1996 |
| Docket Number | Civil Action No. 91-1451-MLB. |
| Citation | 923 F. Supp. 1322 |
| Parties | George W. WAYMAN, Dale Stanislaus, Jess C. Smith, Arlin "Bud" F. Roat, Brad Rhodes, Charlie Reid, John Reents, James L. McKown, Thomas McClernon, Donald B. Howell, Buddy R. Hill, Robert Henderson, Robert C. Conner, Harold Clarke, and Troy M. Botkin, Plaintiffs, v. AMOCO OIL COMPANY, a Maryland Corporation, Defendant. |
| Court | U.S. District Court — District of Kansas |
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Gary M. Austerman, Christopher A. McElgunn, Robert D. Wiechman, Jr., Klenda, Mitchell, Austerman & Zuercher, Wichita, KS, for plaintiff George W. Wayman.
Gary M. Austerman, Christopher A. McElgunn, Robert D. Wiechman, Jr., Klenda, Mitchell, Austerman & Zuercher, Wichita, KS, for plaintiffs Dan Stanislaus, Jess C. Smith, Arlin Roat, Brad Rhodes, John Reents, James L. McKown, Thomas F. McClernon, Donald B. Howell, Buddy R. Hill, Harold Clarke, Troy M. Botkin.
Joseph W. Kennedy, Morris, Laing, Evans, Brock & Kennedy, Chtd., Wichita, KS, Richard C. Godfrey, David J. Zott, Frank Cicero, Jr., Kirkland & Ellis, Chicago, IL, William J. Noble, Chicago, IL, Mark S. Lillie, Kirkland & Ellis, Denver, CO, for defendant Amoco Oil Co.
John J. Kisner, Jr., Office of the District Attorney, Wichita, KS for intervenor State of Kansas.
This case comes before the court on defendant Amoco Oil Company's Motion for Summary Judgment. (Doc. 126.)
Plaintiffs are current or former Wichita area Amoco service station dealers. They have filed this action against Amoco alleging seven state law causes of action, including two counts of breach of contract, two counts of misrepresentation, breach of lease, breach of fiduciary duties, and violation of the Kansas Consumer Protection Act ("KCPA"), K.S.A. ? 50-623, et seq. (Doc. 75, Counts I-VII.) Plaintiffs' claims are similar to those made by other Amoco dealers in various other parts of the United States. Amoco seeks summary judgment on all seven of plaintiffs' claims.
Table of Contents
Summary Judgment Standards ........................................................ ____
Background
The Nature of the Parties' Relationship ....................................... ____
The Dealer Supply Agreement (DSA) ............................................. ____
The Lease Agreement ........................................................... ____
The Meter Marketing Plan, Dealer Buying Price and Pricing Strategies .......... ____
The Discount for Cash Program (DFC) ........................................... ____
The Investment Value Rent Program ............................................. ____
Discussion
Count I ?€” Breach of Contract ?€” DFC ............................................ ____
Plaintiffs' admissions in deposition ...................................... ____
The U.C.C. parol evidence rule, K.S.A. 84-2-202 and DSA's terms ........... ____
Admissibility of the alleged DFC/DBP offset and the DSA ................... ____
Admissibility of the alleged DFC/DBP offset and the credit card contract .. ____
Admissibility of the alleged DFC/DBP offset as "course of dealing" ........ ____
Admissibility of the alleged DFC/DBP offset as a subsequent agreement ..... ____
Enforceability of integration clauses ..................................... ____
Equitable estoppel ........................................................ ____
Count II ?€” Misrepresentation ?€” DFC ............................................ ____
Count III ?€” Breach of Contract ?€” U.C.C. ? 2-305(2) ............................ ____
Count IV ?€” Breach of Lease ?€” IVR Program ...................................... ____
Count V ?€” Misrepresentation ?€” IVR Program ..................................... ____
Count VI ?€” Breach of Duty of Good Faith ....................................... ____
Count VII ?€” Violations of Kansas Consumer Protection Act ........................ ____
Plaintiffs as "individuals" under K.S.A. ? 50-624(b) ...................... ____
"Business purposes" as contemplated by K.S.A. ? 50-624(b) ................. ____
Deceptive and unconscionable practices .................................... ____
Orders ........................................................................ ____
Rule 56(c) of the Federal Rules of Civil Procedure directs the entry of summary judgment in favor of the party who "shows that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." A principal purpose "of the summary judgment rule is to isolate and dispose of factually unsupported claims or defenses." Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986). The court's inquiry is to determine "whether there is the need for a trial ?€” whether, in other words, there are any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986).
The burden of proof at the summary judgment stage is similar to that at trial. "Entry of summary judgment is mandated, after an adequate time for discovery and upon motion, against a party who `fails to make a showing 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.'"1 Aldrich Enters., Inc. v. United States, 938 F.2d 1134, 1138 (10th Cir.1991) (quoting Celotex, 477 U.S. at 322, 106 S.Ct. at 2552). The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact by informing the court of the basis for its motion. Martin v. Nannie and the Newborns, Inc., 3 F.3d 1410, 1414 (10th Cir.1993). This burden, however, does not require the moving party to "support its motion with affidavits or other similar materials negating the opponent's claim." Celotex, 477 U.S. at 323, 106 S.Ct. at 2553. (Emphasis in original). Once the moving party properly supports its motion, the nonmoving party "may not rest upon mere allegation or denials of his pleading, but must set forth specific facts showing that there is a genuine issue for trial." Muck v. United States, 3 F.3d 1378, 1380 (10th Cir.1993). The court reviews the evidence in a light most favorable to the nonmoving party, e.g., Thrasher v. B & B Chemical Co., Inc., 2 F.3d 995, 996 (10th Cir.1993), under the substantive law and the evidentiary burden applicable to the particular claim. Anderson, 477 U.S. at 255, 106 S.Ct. at 2513.
Amoco is in the business of selling gasoline and other petroleum products through a network of service station dealers and independent "jobbers" around the United States. Plaintiffs are service station dealers who sell Amoco-branded products in Kansas.3 Plaintiffs are independent businessmen; they set their own retail prices and make their own purchasing, advertising, and marketing decisions. Plaintiffs have had to invest money in their service stations and, in some cases, they have incurred long-term financial obligations.
Plaintiffs' relationship with Amoco is two-tiered. First, plaintiffs are franchisees of Amoco, marketing and selling Amoco-branded gasoline and automotive products. Second, plaintiffs are lessees of Amoco, leasing Amoco-owned service station facilities.
Amoco requires plaintiffs and most (if not all) of its other dealers to sign certain pre-printed, standardized form contracts which govern their franchisor-franchisee and lessor-lessee relationships. Most significant among these are the "Dealer Supply Agreement" or DSA, concerning the parties' franchise relationship, and the "Lease Agreement," concerning the parties' lessor-lessee relationship. Over the years, plaintiffs have entered into a series of Dealer Supply Agreements and Lease Agreements with Amoco, signing new contracts as previous ones terminated. The agreements usually ran for three years. In addition, plaintiffs contend that Amoco has implemented various programs and policies which bear significantly upon the relationship between Amoco and the dealers under the written contracts and agreements.
The DSAs, Lease Agreements, and other standardized contracts were presented to plaintiffs by an Amoco territory manager who was familiar with all phases of dealer operations. Pete Christy was the territory manager for Wichita from 1967 to 1991. Christy "delivered various written contracts such as the DSA and Lease Agreement in a package of documents to the dealers at the time they became a dealer and thereafter on their renewal dates." Christy Id. at ? 6.
Under the DSA, Amoco agrees to "sell and deliver" gasoline and other products to the plaintiffs, and plaintiffs agree to "purchase and receive" the gasoline and other products from Amoco "in such reasonable quantities as plaintiffs may order." (Doc. 128, Ex. 1A, ? 1.)4 The DSA provides that the price for gasoline purchased by plaintiffs shall be "Amoco's dealer buying price" or DBP:
Prices. The price for motor fuels purchased by Dealer from Amoco hereunder, shall be Amoco's dealer buying price for each respective grade of said products in effect in Amoco's pricing area in which the...
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