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Robins v. Bimbo Foods Bakeries Distribution, Inc.

United States District Court, Third Circuit

October 28, 2013

Kirk Robins, Plaintiff,
v.
Bimbo Foods Bakeries Distribution, Inc., Defendant.

MEMORANDUM RE: DEFENDANT'S MOTION TO DISMISS

MICHAEL M. BAYLSON, District Judge.

I. Introduction

This action involves a dispute between Defendant Bimbo Foods Bakeries Distribution, Inc. ("Defendant"), a producer and distributor of fresh bakery products, and Plaintiff Kirk Robins ("Plaintiff"), an independent operator and/or employee of Defendant, who sold and distributed certain baked goods in a defined sales area pursuant to a Distribution Agreement (the "Agreement"). SAC ¶ 10. Plaintiff brought this suit alleging breach of contract under state law and wrongful termination under the Maryland Franchise Registration and Disclosure Act ("MFRDL").

Jurisdiction is based on diversity of citizenship.

Defendant has filed a Motion to Dismiss Plaintiff's Second Amended Complaint. ECF 17. This Court will GRANT the Motion to Dismiss.

II. Background

On March 30, 2009, Plaintiff entered into a Distribution Agreement with Defendant. ECF 15 ¶ 17. The Agreement provided Plaintiff with exclusive distribution rights to certain specified baked products in a geographic area designated by the Agreement. Id . ¶ 18. Under the terms of the Agreement, Defendant would supply Plaintiff with certain types of baked products and Plaintiff would distribute those products to stores and outlets in the specified geographical area. Id . ¶ 17. Plaintiffs alleges that Defendant's wrongful conduct took place during the course of that business relationship and at the time Plaintiff tried to sell his distribution rights.

III. Procedural History

Plaintiff filed a complaint against Defendant on September 20, 2012, alleging breach of contract and wrongful termination under the MFRDL. ECF 1. On January 1, 2013, Defendant moved to dismiss the Complaint. ECF 6. On January 21, 2013, Plaintiff filed a Memorandum in Opposition to Defendant Motion to Dismiss and exercised his right to amend his Complaint. ECF 7. On February 4, 2013, Defendant moved to dismiss Plaintiff's Amended Complaint. ECF 8.

On April 16, 2013, this Court issued an Order demanding that Plaintiff either (a) file a Second Amended Complaint, or (b) a brief explaining why the Amended Complaint is sufficient. ECF 14. On May 30, 2013, Plaintiff filed a Second Amended Complaint (the "SAC"). ECF 15. On June 27, 2013, Defendant filed a Motion to Dismiss the SAC. ECF 17. Plaintiff filed a Response in Opposition to Defendant's Motion to Dismiss on July 25, 2013, ECF 19, and Defendant filed its Reply on August 7, 2013, ECF 20.

The SAC seeks a permanent injunction, declaratory judgment, and damages resulting from (1) Defendant's alleged breach of contract, and (2) Plaintiff's wrongful termination under the MFRDL. SAC ¶¶ 53-73 (breach of contract), ¶¶ 74-98 (wrongful termination). The SAC alleges that Plaintiff and Defendant entered into a Distribution Agreement (the "Agreement") on March 30, 2009 pursuant to which Plaintiff, as an independent operator, purchased the sole right to distribute and sell Defendant's fresh baked goods to grocery stores in a defined geographic territory defined in the Agreement. SAC ¶ 17.

In support of his breach of contract cause of action (Count I), Plaintiff alleges that Defendant breached the Agreement by failing to honor its obligations. Plaintiff specifically alleges that Defendant invaded Plaintiff's exclusive right to sell products in the designated area, failed to appropriately fill Plaintiff's product orders, and improperly set prices, all in violation of its contractual obligations. Plaintiff also complains that Defendant imposed burdens on Plaintiff - particularly with respect to delivery and marketing - that fell outside the scope of the contract. SAC ¶¶ 22-29; SAC ¶ 52(a)-(z) (enumerating examples of Defendant's impermissible control). Plaintiff claims he felt compelled to sell his route in May 2011 as a result of these alleged breaches. Plaintiff alleges that the above actions constitute a breach of the Agreement, that he was harmed by those actions, and that he is entitled to the damages proximately caused by those breaches.[1] SAC ¶¶ 65-66.

According to Plaintiff, when he tried to sell his distribution rights, Defendant improperly frustrated his sales attempts by, among other things, requiring him to sign a Release of Rights (the "Release") before finalizing the sale. SAC ¶¶ 32-36. Plaintiff claims his supervisor, Kenny Lewis, informed him that the only effect of the Release would be to transfer his rights to the route, but that he must sign the Release to complete the sale. SAC ¶¶ 37-39. Plaintiff alleges that he requested the chance to have counsel review the Release but that Mr. Lewis denied the request. SAC ¶ 42. When Plaintiff met with Defendant regarding the Release over two weeks later, [2] he claims that another of Defendant's representatives reiterated Mr. Lewis' misrepresentations. SAC ¶ 48-49. Plaintiff claims that he then signed the release in reliance on those representations, although he affixed the words "signed in duress" to his signature on the Release to show that he was signing against his will and based on the misrepresentations. SAC ¶ 50. Plaintiff claims that the Release had no effect because he only signed based upon Defendant's intentional, false misrepresentations. SAC ¶¶ 67-72.

In Count II, Plaintiff alleges that Defendant violated the MFRDL by omitting information and making misrepresentations regarding either its relationship with him or the Agreement. SAC ¶ 76. Plaintiff argues that he would not have entered the Agreement if not for Defendant's promise of the right to exclusive service within the designated territory. SAC ¶ 77. But he claims that Defendant intentionally and wrongfully deceived him with respect to those rights and subsequently purchased Sara Lee and sold Sara Lee products in Plaintiff's exclusive sales area.[3] SAC ¶¶ 80-82. Plaintiff alleges that Defendant retained unwarranted control over the purchase and sale price of its product and that Defendant made changes to the products that Plaintiff had to sell without seeking input from him. SAC ¶¶ 83-84. Plaintiff also alleges that Defendant violated the MFRDL by forcing him to sign the Release. SAC ¶¶ 96-97.

Plaintiff asks this Court to toll the statute of limitations period under the MFRDL because Defendant misled him into thinking he had purchased exclusive territorial rights. SAC ¶ 90-91. He also argues that his struggle to engage counsel should toll the statute of limitations. SAC ¶ 92(a)-(e).

IV. The Motion to Dismiss

Defendant moved pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure to dismiss the SAC because it contends that Plaintiff failed to plead sufficient allegations supporting its causes of action. ECF 17-1 (Mem. ...


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