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Tristate Hvac Equipment, Llp v. Big Belly Solar

January 20, 2011

TRISTATE HVAC EQUIPMENT, LLP, PLAINTIFF,
v.
BIG BELLY SOLAR, INC., DEFENDANT.



The opinion of the court was delivered by: Yohn, J

MEMORANDUM

YOHN, J.

Plaintiff TriState HVAC Equipment, LLP ("TriState") has filed a motion for reconsideration of my October 20, 2010, memorandum and order*fn1 insofar as I dismissed TriState's claim under section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), against Big Belly Solar, Inc. ("Big Belly") and transferred this action to the District of Massachusetts, the forum specified in the parties' distribution agreement as the venue for any legal disputes. For the reasons set forth below, I will deny the motion to reconsider as to the dismissal of the Lanham Act claim but will grant the motion to reconsider as to the transfer of the action to the District of Massachusetts and deny the original motion to transfer.

"The purpose of a motion for reconsideration is to correct manifest errors of law or fact or to present newly discovered evidence." Harsco Corp. v. Zlotnicki, 779 F.2d 906, 909 (3d Cir.1985). A court may grant a motion for reconsideration if the moving party demonstrates at least one of the following grounds: "(1) an intervening change in the controlling law; (2) the availability of new evidence that was not available when the court [issued its order]; or (3) the need to correct a clear error of law or fact or to prevent manifest injustice." Max's Seafood Cafe v. Quinteros, 176 F.3d 669, 677 (3d Cir. 1999). Mere dissatisfaction with a court's ruling is not a proper basis for reconsideration, see Progressive Cas. Ins. Co. v. PNC Bank, N.A., 73 F. Supp. 2d 485, 487 (E.D. Pa. 1999), and a motion for reconsideration may not be used to make arguments, or present evidence, that could have been made or presented before the court issued its order, see Johnson v. Diamond State Port Corp., 50 F. App'x 554, 560 (3d Cir. 2002) (not precedential).

In its motion for reconsideration, TriState asserts two clear errors of law. TriState contends first that the dismissal of its Lanham Act claim was based on an improper interpretation of the parties' distribution agreement. TriState next contends that the decision to transfer venue to the District of Massachusetts constitutes clear error.

Lanham Act Claim

TriState bases its Lanham Act claim on allegations that, in selling trash compactors to the City of Philadelphia (the "City"), Big Belly made false or misleading statements, telling the City that it had to purchase directly from Big Belly and did not have to put the contract out for bid to distributors. In my October 20 memorandum and order, I concluded that because Big Belly, in section 10(a) of its distribution agreement with TriState, had reserved the right not to accept any order placed by TriState, its statements to the City were neither false nor misleading.

In seeking reconsideration, TriState now contends that this interpretation of section 10(a) is "inconsistent with" and renders "meaningless" section 3(c) of the agreement, in which Big Belly reserved the right to sell directly to so-called key and national accounts and agreed to provide a list of such accounts. (Pl.'s Br. in Supp. of Mot. for Partial Reconsideration ("Pl.'s Br.") at 4.) TriState argues that there would be no need for section 3(c)'s directive that Big Belly list its key and national accounts if in fact Big Belly could reject, in its sole discretion, any orders from TriState under section 10(a).*fn2 But, as discussed above, a motion for reconsideration may not be used to make arguments that could have been made before dismissal. And in its opposition to Big Belly's motion to dismiss, TriState did not argue that Big Belly's right of refusal was limited in any way-and, indeed, did not even respond to Big Belly's argument that it made no misrepresentations because it had the right not to accept an order placed by TriState.

In any event, TriState's argument lacks merit. Big Belly's right to reject, in its sole discretion, any order placed by TriState-regardless of whether the order is for a designated key or national account-is not inconsistent with, and does not eliminate, the separate and independent requirement that Big Belly identify the key and national accounts it intends to pursue. Section 3(c) is intended to put TriState on notice as to which accounts Big Belly intends to pursue directly and to provide a measure of compensation if TriState is involved in a sale by Big Belly to such an account. Contrary to TriState's contentions, I see no inconsistency between asserting that Big Belly had the right under section 10(a) to reject an order placed by TriState on behalf of the City (and thus made no misrepresentation to the City in violation of the Lanham Act) and acknowledging that, if TriState's allegations are true, Big Belly may nonetheless have breached its contractual obligations to TriState by not identifying the City as a key account and by failing to compensate TriState for its participation in the sale of trash compactors to the City.

TriState also asserts that it has obtained new evidence that warrants reconsideration of my dismissal order. In particular, TriState has obtained a March 2, 2009, letter from Big Belly to the City's Streets Department, in which Big Belly asserted that the agreements with its distributors did not preclude Big Belly from selling directly to any account and that the agreements with its Philadelphia-area distributors listed the City as a key account of Big Belly's. (Decl. of Anthony J. DiMarino in Supp. of Mot. for Partial Reconsideration ("DiMarino Decl.") Ex. A.) TriState has also obtained a report issued by the City Controller's Office following a review of the City's purchase of Big Belly trash compactors. The report discusses both the March 2, 2009, letter and a subsequent interview with Big Belly's CEO. According to the report, Big Belly's CEO acknowledged that the letter was incorrect, since an agreement with one of its distributors (TriState) did not list the City as a key account, but denied that the letter was a material misrepresentation, explaining that he believed that TriState was aware that Big Belly was pursuing sales to the City. (Id. Ex. B, at 3.) TriState contends not only that these documents provide evidence of additional misrepresentations made to the City but also that they suggest that my interpretation of the distribution agreement is inconsistent with Big Belly's own interpretation of the agreement. Noting that Big Belly's CEO did not mention section 10(a) of the distribution agreement in the interview with the City Controller's Office, TriState argues that that omission suggests that Big Belly "does not understand [section] 10(a) to provide . . . an unconditional right to reject any orders from TriState." (Pl.'s Br. at 8.)

TriState, however, obtained this evidence in July 2010 (see DiMarino Decl. ¶¶ 2--3), approximately three months before I dismissed TriState's Lanham Act claim. Although TriState obtained the evidence after briefing on Big Belly's motion to dismiss had been completed, to the extent that TriState believed that this evidence could affect my ruling on Big Belly's motion to dismiss the Lanham Act claim, TriState had ample time to supplement its brief in order to incorporate this new evidence.

TriState points out that in its opposition to Big Belly's motion to dismiss, TriState requested, in a footnote, "leave to amend its [c]omplaint, if necessary" (Pl.'s Resp. in Opp'n to Def.'s Mot. to Dismiss at 18 n.14), and TriState contends that it should have been permitted to amend its Lanham Act claim before that claim was dismissed. TriState asserts that "'even when a plaintiff does not seek leave to amend, if a complaint is vulnerable to 12(b)(6) dismissal, a District Court must permit a curative amendment, unless an amendment would be inequitable or futile.'" (Pl.'s Br. at 15 (quoting Alston v. Parker, 363 F.3d 229, 235 (3d Cir. 2004)).) But in Fletcher-Harlee Corp. v. Pote Concrete Contractors, Inc., 482 F.3d 247, 252--53 (3d Cir. 2007), the Third Circuit explained that "[i]n non--civil rights cases, the settled rule is that properly requesting leave to amend a complaint requires submitting a draft amended complaint." TriState did not submit a draft amended complaint before I ruled on Big Belly's motion to dismiss, even though it had ample opportunity to do so before its Lanham Act claim was dismissed, and there was thus no error in dismissing the claim on the basis of the allegations in its original complaint.

TriState contends that the failure to reconsider the dismissal order "will cause TriState to suffer a manifest injustice," arguing that "Big Belly should not be permitted to breach the Distributorship Agreement, yet be shielded from the consequences of its misconduct by the same Agreement." (Pl. Br. at 9.) But TriState still has a breach-of-contract claim against Big Belly,*fn3 and to the extent that Big Belly did breach the agreement, as TriState contends, dismissal of the Lanham Act claim will not shield Big Belly from liability under the breach-of-contract claim.

Because the motion for reconsideration presents arguments and evidence that TriState could have presented before I dismissed its Lanham Act claim, and because TriState has not convincingly demonstrated that the failure to reconsider the dismissal of that claim as stated in the original complaint would work a manifest injustice, I will deny TriState's ...


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