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MOOREHEAD v. GMC

December 30, 1977

MARTIN L. MOOREHEAD
v.
GENERAL MOTORS CORPORATION, WILLIAM G. ROHRER, ALAN J. KIRSCH and SAMUEL MARINO



The opinion of the court was delivered by: LUONGO

 Martin L. Moorehead brought this action for damages against General Motors Corporation and against William G. Rohrer, Alan J. Kirsch, and Samuel J. Marino. The complaint states four causes of action, all based on the circumstances surrounding General Motors' termination of a franchised Chevrolet dealership, Moorehead & Sons Chevrolet, Inc. Plaintiff asserts general federal question jurisdiction, 28 U.S.C. § 1331(a) (1970), for the first cause of action, and pendent jurisdiction for the remaining three causes of action.

 The first cause of action, based on the Automobile Dealers' Day in Court Act, 15 U.S.C. §§ 1221-25 (1970), alleges that General Motors Corporation (hereinafter GMC) is liable under the Act for acting "in bad faith toward both plaintiff and Moorehead, Inc. [the dealership] (a) in refusing to permit Moorehead, Inc. to renew its franchise; (b) in terminating the franchise of Moorehead, Inc.; and (c) in refusing to permit the plaintiff or Moorehead, Inc. to make contractual arrangements with a successor franchisee." Complaint para. 23. None of the individual defendants are named in this cause of action. The plaintiff's second cause of action, however, alleges a conspiracy among GMC and defendants Rohrer, Kirsch, and Marino to render the Moorehead, Inc. franchise worthless, to deprive Moorehead of his employment as an officer and "dealer operator" of Moorehead, Inc., and to drive Moorehead out of the automobile business.

 The fourth cause of action alleges that Kirsch and Marino, "on their own or in conspiracy with GMC," caused GMC to disapprove Preston Mintz, Moorehead's proposed successor to the franchise, thereby depriving Moorehead of the opportunity to sell the franchise to his successor. Complaint para. 34. Defendant Rohrer is not named in this cause of action.

 This case is now before me on separate motions by GMC and Rohrer for summary judgment under Rule 56 of the Federal Rules of Civil Procedure. Rule 56(c) provides in pertinent part:

 
"The judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show 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."

 "The law is clear that one who moves for a summary judgment has the burden of demonstrating that there is no genuine issue of fact." Fairbanks, Morse & Co. v. Consolidated Fisheries Co., 190 F.2d 817, 824 (3d Cir. 1951), quoted with approval in Ettinger v. Johnson, 556 F.2d 692, 696 (3d Cir. 1977). For purposes of a summary judgment motion, a court must view the evidence in the light most favorable to the party opposing the motion. Bishop v. Wood, 426 U.S. 341, 347 n.11, 48 L. Ed. 2d 684, 96 S. Ct. 2074 (1976); United States v. Diebold, Inc., 369 U.S. 654, 655, 8 L. Ed. 2d 176, 82 S. Ct. 993 (1962) (per curiam); Goodman v. Mead Johnson & Co., 534 F.2d 566, 573 (3d Cir. 1976), cert. denied, 429 U.S. 1038, 50 L. Ed. 2d 748, 97 S. Ct. 732 (1977). Thus, if the party opposing the motion alleges facts in his complaint that are supported by affidavits or other evidence, those facts must be taken as true in ruling on the motion. First Nat'l Bank of Cincinnati v. Pepper, 454 F.2d 626, 629 (2d Cir. 1972). The opposing party may not, however, rest on the allegations contained in his complaint. Federal Rule 56(e) provides in pertinent part:

 
"When a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of his pleading, but his response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If he does not so respond, summary judgment, if appropriate, shall be entered against him."

 See Sound Ship Building Corp. v. Bethlehem Steel Co., 533 F.2d 96, 99 (3d Cir.), cert. denied, 429 U.S. 860, 50 L. Ed. 2d 137, 97 S. Ct. 161 (1976); Williams v. McAllister Bros., Inc., 534 F.2d 19, 23-24 (2d Cir. 1976); Season-All Indus., Inc. v. Merchant Shippers, 417 F. Supp. 998, 1002 (W.D. Pa. 1976).

 The factual record in this case consists of the initial pleadings, the depositions taken of the following parties, and the 90 exhibits identified in connection with the depositions: Martin Moorehead (201 pp.), William G. Rohrer (91 pp.), Alan J. Kirsch (106 pp.), Samuel J. Marino (99 pp.), Edward G. McLeod, Assistant Zone Manager for Chevrolet (93 pp.), Rudolph H. Schmittdiel, Jr., Zone Manager for Chevrolet (87 pp.), Joseph Rooney, successor to Mr. Schmittdiel as Zone Manager (13 pp.), Seville S. Funk, Zone Business Manager for Chevrolet (35 pp.), and Preston Mintz (52 pp.). In addition, GMC's motion for summary judgment is supported by affidavits from Mr. Schmittdiel and Mr. McLeod, from John P. Eckenrode, a former Assistant Zone Manager for Chevrolet in the Zone where Moorehead, Inc. operated, and from John P. Meighan, a former District Manager in the District where Moorehead, Inc. operated. Plaintiff has filed a brief in opposition to GMC's motion, and it contains half a dozen citations to various exhibits and to statements made during depositions. The plaintiff has submitted no affidavits in support of his opposition to GMC's motion and he has offered no explanation for the absence of supporting affidavits. *fn1"

 Following oral argument, I deferred ruling on GMC's motion in order to allow the plaintiff to take the deposition of Preston Mintz. I have considered carefully the Mintz deposition, as well as the parties' supplemental briefs in connection therewith. They have little bearing upon what I view as the controlling issue in this case.

 The facts of this case, viewed in the light most favorable to Moorehead, are as follows: On October 10, 1966, Moorehead and defendant Rohrer entered into a written agreement for the formation of Moorehead & Sons Chevrolet, Inc. Rohrer put up $65,000, acquired real estate in New Hope, Pennsylvania, and built a new building thereon to lease to the dealership. In return, Rohrer took a 63.9% interest in the dealership's capital stock. The agreement provided that for five years Moorehead was to have the right of first refusal before Rohrer could sell any of the stock to a third party. Plaintiff's Ex. 2, paras. 6-7. In addition, Moorehead was President of the corporation and held all its remaining stock.

 Moorehead, Inc. was formed in November 1966, and on December 1 of that year it entered into a five-year Dealer Selling Agreement with GMC. GMC Ex. 8. The Agreement was signed by Moorehead as President of Moorehead, Inc. Although the Agreement named Moorehead, Inc., and not Moorehead himself, as the dealer, it also provided:

 
"THIRD: This Agreement is a personal service contract, and is entered into by Chevrolet with Dealer in reliance upon and in consideration of the personal qualifications, and the representations made to Chevrolet with respect thereto, of the following named person or persons who, it is agreed, will substantially participate in the ownership of ...

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