United States District Court, E.D. Pennsylvania
May 6, 2004.
BUZZMARKETING, LLC, Plaintiff
THE UPPER DECK COMPANY, LLC, Defendant
The opinion of the court was delivered by: BERLE M. SCHILLER, District Judge
MEMORANDUM AND ORDER
Plaintiff Buzzmarketing LLC ("Buzzmarketing") brings this suit
against Defendant The Upper Deck Company LLC ("Upper Deck") alleging four
causes of action: (1) breach of written contract; (2) breach of oral
contract; (3) breach of implied-in-fact contract; and (4) unjust
enrichment/quantum meruit. Defendant has moved for summary judgment,
arguing that Plaintiff cannot meet its burden of demonstrating the
existence of any written, oral, or implied contract or any actions that
would give rise to a quantum meruit claim. For the reasons set out below,
the Court grants summary judgment in favor of Upper Deck.
I. FACTUAL BACKGROUND
The following facts are undisputed, except where specifically noted
otherwise. Buzzmarketing is an advertising firm incorporated in
Pennsylvania (Compl. ¶ 1); Upper Deck is a California-based producer
of toys (Compl. ¶ 2). In January 2003, Upper Deck contacted
Buzzmarketing as part of a search for marketing firms to handle the
launch of a new toy, named "Breakey." (Hughes Dep. at 59.) The following month, Upper Deck's
Vice President of Sales Rich Henry attended an exhibition in New York,
where he met with Buzzmarketing CEO Mark Hughes. After discussing the
Breakey product, Henry requested that Hughes prepare a marketing proposal
for Upper Deck to evaluate. (Id. at 69-70.) Upper Deck rejected
each of the first four proposals, which were sent between March and April
2003. (Id. at 71-72, 157, 160-61; Def.'s Mot. for Summ. J. at
3-5.) On approximately April 15, Buzzmarketing sent to Upper Deck the
final proposal, which is the proposal at issue in this case. (Hughes Dep.
Ex. 18 at 2.) That proposal described a domestic marketing campaign that
entailed, in relevant part, paying a popular music group to endorse the
product. (See Hughes Decl. ¶ 6.) The proposal also contained
a clause stating that "[t]his Agreement may be executed in counterparts
and facsimile signatures shall suffice as originals." (Hughes Dep. Ex. 7
On May 14, Henry and Hughes had a phone conversation regarding the
final proposal. (Hughes Decl. ¶ 4; Def.'s Mot. for Summ. J. at 6.)
The content of this conversation is in dispute: Buzzmarketing alleges
that an oral contract was formed; Upper Deck states that it was merely a
part of the ongoing negotiations. After the conversation, Hughes emailed
an amended version of the final proposal to Upper Deck, along with a
request for a $122,500.00 wire transfer. (Hughes Dep. Ex. 7 at 1.)
On May 15, in response to Hughes's request for payment, Henry sent an
internal email asking Upper Deck's marketing director Louise Curcio to
"follow up on getting the contract signed and [Buzzmarketing's] money
wired." (Hughes Dep. Ex. 11 at 1.)
On May 30, Upper Deck's marketing manager Kristy Watson phoned Hughes
to say that she would call him when the $122,500.00 was going to be
wired. (Hughes Decl. ¶ 8.) That same day, Curcio left a voicemail for Hughes stating that he would be
receiving the wire transfer on Monday or Tuesday of the following week.
(Id. ¶ 9.)
On May 31, an article appeared in Billboard Magazine quoting Jeff
Greenfield, of the marketing firm 1st Approach, as stating that Upper
Deck would be sponsoring a music group's domestic and European tours in
exchange for that group's endorsement of a new Upper Deck product.
See Liz Skinner, Bling! Bling! Ka-Ching!, BILLBOARD, May 31,
2003. Greenfield subsequently informed Hughes that someone from Upper
Deck (either Curcio or spokesperson Don Williams) had asked the Billboard
reporter to correct the article to reflect that the marketing arrangement
only covered domestic, not European, advertising. (Hughes Dep. at
On June 2, Upper Deck sent Hughes a revised version of the final
proposal. (Hughes Dep. Ex. 15.) On June 3, Hughes sent Upper Deck further
revisions to the written agreement. (Id. Ex. 16.) Later that
day, Upper Deck responded with yet more revisions. (Id. Ex. 17.)
Finally, on June 11, Henry called Hughes to inform him that Upper Deck
would not be launching the Breakey product, and therefore Buzzmarketing's
services would not be needed. (Hughes Decl. ¶ 10.) Henry also
requested an itemized list of Buzzmarketing's costs for reimbursement,
which Buzzmarketing submitted but Upper Deck never paid. (Id.)
II. STANDARD OF REVIEW
Summary judgment is appropriate when the admissible evidence fails to
demonstrate a dispute of material fact and the moving party is entitled
to judgment as a matter of law. FED. R. CIV. P. 56(c); Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). When the moving
party does not bear the burden of persuasion at trial, that party may
meet its burden on summary judgment by showing that the nonmoving party's evidence is insufficient to
carry its burden of persuasion at trial. Celotex Corp. v.
Catrett, 477 U.S. 317, 323-24 (1986). Thereafter, the nonmoving
party demonstrates a genuine issue of material fact if sufficient
evidence is provided to allow a reasonable jury to find for him at trial.
Anderson, 477 U.S. at 248. In order to meet this burden, the
opposing party must point to specific, affirmative evidence in the record
and not simply rely on mere allegations, conclusory or vague statements,
or general denials in the pleadings. Celotex, 477 U.S. at 324.
In reviewing the record, "a court must view the facts in the light most
favorable to the nonmoving party and draw all inferences in that party's
favor." Armbruster v. Unisys Corp., 32 F.3d 768, 777 (3d Cir.
1994). Furthermore, a court may not make credibility determinations or
weigh the evidence in ruling upon the motion. See Reeves v. Sanderson
Plumbing Prods., 530 U.S. 133, 150 (2000); see also Goodman v.
Pa. Tpk. Comm'n, 293 F.3d 655, 665 (3d Cir. 2002).
A. Count I: Breach of Written Contract
Buzzmarketing concedes that no written contract was ever executed.
Thus, summary judgment is granted to Upper Deck on Count I of the
B. Count II: Breach of Oral Contract
Buzzmarketing argues that the negotiations concerning the final
proposal culminated in an oral contract formed during the May 14
conversation between Henry and Hughes. Upper Deck responds that there is
no evidence that the parties formed a contract during that conversation.
Pennsylvania courts have decided two relatively recent cases regarding
the question of whether parties who orally agree to the terms of an unsigned
written contract are bound by the terms of the writing.*fn1 In
Shovel Transfer & Storage, Inc. v. Pennsylvania Liquor Control
Bd., 739 A.2d 133, 138 (Pa. 1999), the Pennsylvania Supreme Court
was asked to decide whether the fact that a proposed contract contained
signature lines was conclusive evidence that the parties intended to
require the contract to be executed only in writing, such that an oral
agreement thereon would be unenforceable. The court held that if the
contract had contained language stating the parties' intent to execute
the agreement in writing, the oral agreement would indeed have been
invalid, id. (citing Franklin Interiors v. Wall of Fame
Mgmt. Co., Inc., 511 A.2d 761 (Pa. 1986)), but that the absence of
such language would be construed against the drafting party-the
defendant. Id. at 139. Construing the absence of this
contractual language in the plaintiffs favor, the court held that
signature lines alone were insufficient proof of the parties' intent to
execute the agreement in writing, and therefore the oral agreement to the
terms of the contract would be enforced.*fn2 Id.
Subsequently, in Commonwealth v. On-Point Technology Sys.,
Inc., 821 A.2d 641 (Pa. Commw. 2003), the Commonwealth Court
was asked to determine whether a proposed contractual clause, stating that the contract in question would
"not be fully executed and binding on the Parties unless and until all
signatures are affixed hereto," constituted a manifestation of the
parties' intent to execute the agreement only in writing. The court,
interpreting Shovel, held that if a contract contains language
requiring execution to be in writing, courts should honor the parties'
intent by not enforcing an oral agreement to the terms of the writing.
See id. at 648, 649 n. 13 (noting that "the language of the
proposal requests" can indicate "that a contract would not be formed
until its terms are memorialized in writing and that writing is formally
executed by all the parties"). The court further held that where the
writing in question contained a term that clearly manifested the parties'
intent only to execute the agreement in writing, and where it was
undisputed that neither party had actually signed the document, it was
error for a state administrative board to determine that an oral
agreement was enforceable. Id. at 648-49.
In the instant case, the final proposal provides that "[t]his Agreement
may be executed in counterparts and facsimile signatures shall suffice as
originals." By describing the manner in which "signatures shall suffice"
to "execute" the agreement, this clause clearly indicates the parties'
intent to execute the agreement only by signing it. Indeed, it is
difficult to conceive of any reasonable reading of this term under which
the agreement could be executed without the signatures of both parties.
Thus, the writing demonstrates that the parties intended to be bound only
by the terms of the written document once signed. Accordingly, Plaintiff
cannot as a matter of law prevail on its claim for breach of an oral
agreement to the terms of the writing,*fn3 and summary judgment is
granted to Upper Deck on Count II of the Complaint.*fn4
C. Count III: Breach of Implied-in-Fact Contract
Count III of the Complaint alleges that Upper Deck breached an
implied-in-fact contract. As Pennsylvania courts have defined it, "[a]
contract implied in fact is one where the parties assent to the formation
of a contract, but instead of being expressed in words, the intention to
[incur] obligation is inferred from the conduct of the parties in light
of surrounding circumstances including a course of conduct." Highland
Sewer & Water Auth. v. Forest Hills Mun. Auth., 797 A.2d 385,
390 (Pa. Commw. 2002) ("The key question is what conduct of
[defendant], besides negotiating, was there from which its assent to a
contract . . . could be inferred. . . ."); see also AmeriPro Search,
Inc. v. Fleming Steel Co., 787 A.2d 988, 991 (Pa. Super. 2001)
(upholding trial court finding that no implied-in-fact employment
contract existed where parties' conduct did not give rise to inference of
agreement on salary term). As with any contract, the agreement is
enforceable only if the parties agree to the material terms. Lombardo
v. Gasparini Excavating Co., 123 A.2d 663, 666 (Pa. 1956) ("[I]n order for there to be an enforceable contract, the nature
and extent of its obligation must be certain; the parties themselves must
agree upon the material and necessary details of the bargain."). Thus, to
make out a case of an implied-in-fact contract, Buzzmarketing must show
that the parties' conduct gives rise to an inference of agreement on the
material terms of a marketing agreement for the Breakey product.
The record in this case does not give rise to the inferences
Buzzmarketing is required to demonstrate. First, neither party performed
any of the tasks that they were allegedly expected to perform under the
contract-i.e., Upper Deck never sent any payments, and Buzzmarketing
never performed any marketing services. Therefore, no agreement can be
inferred from any contractual performance. Second, although prior
dealings between parties commonly form the basis for implied-in-fact
contracts, see, e.g., McGough v. Broadwing Communications, Inc.,
177 F. Supp.2d 289, 297 (D.N.J. 2001) (holding that implied-in-fact
services contract was formed under Pennsylvania law where plaintiffs had
been paid by defendant for same work in the past), the instant parties
had no previous dealings from which a contract could be inferred. Third,
the only admissible evidence that Buzzmarketing presents in support of
the existence of an implied-in-fact contract is the phone and email
communications in which Upper Deck appears to acknowledge that money
should be wired to Hughes.*fn5 Upper Deck does not dispute that Henry
and Hughes reached an agreement on the amount of Buzzmarketing's fee during the May 14 conversation but argues
that this alone is insufficient evidence to make out a case of an
implied-in-fact contract. The evidence supports Upper Deck's position:
When viewed in the light most favorable to Buzzmarketing, the record
shows at most that the parties agreed that Upper Deck would pay
Buzzmarketing $122,500.00 at an undetermined time for unspecified
marketing services. This agreement cannot be construed as an
implied-in-fact contract because the price term alone, in the absence of
manifested agreement as to any other material term of the contract (e.g.,
the services that Buzzmarketing was to provide, the due dates of any
payments, the scope of the agreement, etc.), is insufficient to create an
enforceable contract for services. See Porreco v. Maleno Developers,
Inc., 761 A.2d 629, 633 (Pa. Commw. 2000) (holding that parties
who agreed to settle construction-related lawsuit for specified monetary
amount but could not subsequently agree to terms of construction had no
enforceable agreement); Miller v. Clay Township, 555 A.2d 972
(Pa. Commw. 1989) (same); Halomch v. Amminiti,
154 A.2d 406, 409 (Pa. Super 1959) (holding that agreement to build house was
unenforceable where it contained price term but did not specify number of
stories, rooms, windows, or closets); cf. On-Point Technology,
821 A.2d at 649 n. 12 (finding that contract for sale of goods was not
formed where parties agreed to quantity term only); Steven T. Flowers
v. Shein & Brookman, P.A., 1983 WL 265400 (Pa. Ct. Com. Pl. Mar.
17, 1983) (holding that oral contract to provide marketing services was
unenforceable where it specified marketing to be done but not time or
compensation terms). Thus, absent evidence or conduct from which all or
most of the remaining key terms could be inferred, Buzzmarketing's claim
for breach of an implied-in-fact contract must fail.
D. Count IV: Unjust Enrichment/Quantum Meruit
Buzzmarketing concedes that recovery in quantum meruit is not
warranted. Thus, summary judgment is granted to Upper Deck on this claim.
For the reasons stated above, Defendant's motion for summary judgment
is granted. An appropriate Order follows.
AND NOW, this 6th day of May, 2004, upon
consideration of Defendant Upper Deck Company LLC's Motion for Summary
Judgment or in the Alternative Partial Summary Judgment, Plaintiff
Buzzmarketing LLC's response thereto, Defendant's reply, and oral
argument thereon, it is hereby ORDERED that:
1. Defendant's Motion for Leave to File a Reply
(Document No. 18) is GRANTED.
2. Defendant's Motion for Summary Judgment
(Document No. 15) is GRANTED.
3. Judgment is entered in favor of Defendant and
4. The Clerk of Court is directed to close this