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Samson Lift Technologies, LLC v. Jerr-Dan Corporation

August 11, 2011


The opinion of the court was delivered by: Sylvia H. Rambo United States District Judge



Before the court is Plaintiff's motion for partial summary judgment on liability on its breach of contract claim.*fn1 (Doc. 72.) For the reasons that follow, Plaintiff's motion will be granted in part and denied in part.

I. Background*fn2

On June 4, 2004, Plaintiff, Samson Lift Technologies, LLC ("Samson") acquired ownership of a patent that related to the "use, manufacture, marketing, advertising, sale, distribution and provision of a fork lift apparatus adapted to be coupled to a truck or trailer." (Pl.'s Statement of Material Facts ("SMF") ¶¶ 1, 3.) The parties and the court have generally referred to this piece of equipment as a side-loading vehicle retriever ("SLVR") because it allows a tow truck to pull along side a parked car - as opposed to in-front of, or behind - and, by lowering and extending forks can extract a vehicle from a parked spot without any damage to the parked vehicle. Although Samson acquired a U.S. Patent for this technology, it did not have the capacity to manufacture the SLVR in the United States. Therefore, Samson searched for a manufacturing company with appropriate resources and marketing abilities to manufacture the SLVR.

By late 2003, Samson considered two companies, Jerr-Dan and Miller, to be the front runners. For financial and marketing reasons, Samson chose to enter into a licensing agreement with Jerr-Dan. During the process of negotiating the terms of the licensing agreement, discussions also took place concerning entering into a distributor agreement. However, the parties greatly contest whether conversations merely took place, or actual promises were made to enter into a distributor agreement. (Pl.'s SMF ¶ 16 (citing to a number of emails and other correspondence that Samson argues constitute promises by Jerr-Dan representatives to enter into a distributor agreement immediately after signing the license agreement); Def.'s SMF ¶ 16 (citing the deposition of Jerr-Dan representative Jeff Weller stating that "he could not recall agreeing to 'do a distributor agreement immediately upon signing the license agreement.'").)

On June 16, 2004, the parties executed an initial license agreement. A representative of Samson stated that the agreement was entered into based on JerrDan's alleged promise that a distributor agreement be entered into promptly. (Pl.'s SMF ¶ 17.) Defendants cite to the deposition of Jeff Weller, a representative of JerrDan, to rebut this claim. (Def.'s SMF ¶ 17.) Subsequent to the execution of the initial license agreement being entered into, Defendant OshKosh Corp. ("OshKosh") acquired Jerr-Dan. Samson claims that after this acquisition, Jerr-Dan and OshKosh demanded changes to the initial license agreement, including changes regarding patent protection and disclosure. (Pl.'s SMF ¶ 18.) On July 22, 2004, the final License Agreement was signed by all parties.*fn3 (Pl.'s SMF ¶ 19.)

Samson claims that the License Agreement contains the following specific promises by Jerr-Dan: exclusivity targets would be set at 350 SLVR's for the period from the agreement's inception through June 30, 2006 and each twelve month period thereafter (Pl.'s SMF ¶ 20)*fn4 ; Jerr-Dan would "'continuously and diligently procure' and maintain facilities and trained personnel adequate to make reasonable commercial efforts (Pl.'s SMF ¶ 22(a), the "Resource Promise"); JerrDan would "do the foregoing in a manner 'no less thorough, diligent, and professional' than Jerr-Dan would with its other products" (Pl.'s SMF ¶ 22(b), the "Non-Discrimination Promise"); "Jerr-Dan promised to sell the Samson Product only in United States" (Pl.'s SMF ¶ 24(a), the "Territorial Restriction" promise); and that the License Agreement contained a patent protection clause whereby Jerr-Dan would inform Samson if it applied for a patent for any "Improvements" to the SLVR during the applicability of the License Agreement. (Pl.'s SMF ¶ 24(b), the "Patent Promise.")

On February 14, 2006, the parties entered into a Distributor Agreement. (Doc. 73-11, Ex. 3, Distributor Agreement.) Under the Distributor Agreement, JerrDan was obligated to: train employees and representatives in the general use of the SLVR*fn5 and, Jerr-Dan was to provide, "upon [Samson's] request and upon mutually agreed upon terms, . . . reasonable assistance during major sales presentations to governmental representatives." (Pl.'s SMF ¶ 25; Def.'s SMF ¶ 26; Pl.'s SMF ¶ 26, the "Support Promise.")

Samson claims that the above alleged "promises" were incorporated into the Agreements, and thus actionable under contract law. (Pl.'s SMF ¶¶ 27, 29.) JerrDan disputes that any such "promises" were incorporated into either the License Agreement or Distributor Agreement and thus also disputes that they are actionable under these contracts. The facts and evidence in record - inluding depositions, declarations and affidavits from various employees of the respective companies - diverge greatly with regard to what "promises" or "representations" were made during the course of negotiating both the Licencing Agreement and Distributor Agreement. (See Amend. Compl. ¶¶ 45, 46, 47, 48, 49, 57, 59, 61, 61, 63, 71; Decls. Baish, Anderson, D'Angelo, Joel Amsley, Kuriakose, Wasserman, Anderson, Gelbart; Deps. Joel Amsley, Karen Seylar Amsley, Weller, Blankenfeld, Kuiakose, Hammond, Saffelle, Chiaramonte, Surace, D'Angelo, Carberry, Smith, Walter, Aiken, Rutenberg, Lazarus, Anderson, Gelbart, Kimmitt, Badgley, Szews.)

Although the parties generally agree that a Licensing Agreement and a Distribution Agreement were entered into, they dispute the intent of the parties regarding some of the language contained in the Agreements. The parties also dispute at what point subsequent to the signing of the Licensing Agreement the Distribution Agreement was to be entered into. Finally, perhaps the largest contention between the parties pertain to whether or not Jerr-Dan made "reasonable commercial efforts" to market the SLVR in a manner consistent with it other products. The court will discuss each "promise" in turn.

II. Legal Standard

Summary judgment is proper when "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." Fed. R. Civ. P. 56(c); accord Saldana v. Kmart Corp., 260 F.3d 228, 231-32 (3d Cir. 2001). A factual dispute is "material" if it might affect the outcome of the suit under the applicable law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A factual dispute is "genuine" only if there is a sufficient evidentiary basis that would allow a reasonable fact-finder to return a verdict for the nonmoving party. Id. at 248. The court must resolve all doubts as to the existence of a genuine issue of material fact in favor of the non-moving party. Saldana, 260 F.3d at 232; see also Reeder v. Sybron Transition Corp., 142 F.R.D. 607, 609 (M.D. Pa. 1992).

The moving party bears the initial burden of demonstrating the absence of a disputed issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). Upon such a showing, the burden then shifts to the non-moving party to present "specific facts showing the existence of a genuine issue for trial." Fed. R. Civ. P. 56(e). The nonmoving party may not simply sit back and rest on the allegations in its complaint; instead, it must "go beyond the pleadings and by [its] own affidavits, or by the depositions, answers to interrogatories, and admissions on file, designate specific facts showing that there is a genuine issue for trial." Celotex Corp., 477 U.S. at 324 (internal quotations omitted); see also Saldana, 260 F.3d at 232 (citations omitted). Summary judgment should be granted where a party "fails 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 at trial." Celotex, 477 U.S. at 322-23. "'Such affirmative evidence -- regardless of whether it is direct or circumstantial -- must amount to more than a scintilla, but may amount to less (in the evaluation of the court) than a preponderance.'" Saldana, 260 F.3d at 232 (quoting Williams v. Borough of West Chester, 891 F.2d 458, 460-61 (3d Cir. 1989)).

Because subject matter jurisdiction in this case is based on diversity of citizenship, the court looks to the substantive law of Pennsylvania to determine the rights and obligations of the parties. Erie R.R. Co. v. Tompkins, 304 U.S. 64, 77 (1938). The law of the Commonwealth is declared by "its Legislature in a statute or by its highest court." Id. The Pennsylvania Supreme Court is the best authority on Pennsylvania law, but when the Supreme Court has not issued a clear pronouncement in a particular area, the court "must consider relevant state precedents, analogous decisions, considered dicta, scholarly works, and any other reliable data" to determine what the law is. McKenna v. Ortho Pharm. Corp., 622 F.2d 657, 661, 663 (3d Cir. 1980); see also Comm'r v. Estate of Bosch, 387 U.S. 456, 465 (1967). Opinions from lower Pennsylvania courts are not controlling, but they are entitled to significant weight when there is no indication that the Pennsylvania Supreme Court would rule otherwise.

III. Discussion

A. Individual Alleged Promises ...

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