United States District Court, D. Massachusetts
PRIMARQUE PRODUCTS CO. INC., Plaintiff,
WILLIAMS WEST & WITTS PRODUCTS COMPANY d/b/a INTEGRATIVE FLAVORS, Defendant.
ORDER AND MEMORANDUM OF DECISION
TIMOTHY S. HILLMAN DISTRICT JUDGE.
Primarque Products Co. Inc. (“Plaintiff” or
“Primarque”) has filed claims against Defendant,
Williams West & Witts Products Company d/b/a Integrative
Flavors (“Defendant” or “WWW”)
alleging claims for Breach of Contract (Count I), Promissory
Estoppel (Count II), Intentional Interference with Business
Relations (Count III), and violation of the Massachusetts
Consumer Protection Act, Mass.Gen.L. ch. 93A (“Chapter
93A”)(Count IV). WWW has filed a Counterclaim against
Primarque alleging a claim for breach of contract (Count I).
This Memorandum and Order of Decision addresses
Defendant/Counter-Claimant Williams West & Witt's
Products Company d/b/a Integrative Flavors' Motion for
Summary Judgment (Docket No. 129). For the reasons set forth
below, that motion is granted, in
part and denied, in
a soup base manufacturer and Primarque is a former
distributor of WWW's soup base products. Jack Barron
(“Barron”) is Primarque's current owner and
president. In 1986, Barron acquired Primarque from his
father, Selwyn Barron, who owned and operated Primarque from
its inception. Dorothy Palmer (“Dorothy”) and
Victor Palmer owned and operated WWW between October 1, 1981
and September 15, 2005. Georgeann Quealy
(“Georgeann”) and Brian Quealy
(“Brian” and together with Georgeann, the
“Quealys”) purchased WWW from the Palmers in
September of 2005. Primarque and WWW began their relationship
distributor, Primarque purchased and resold WWW's soup
base products. Primarque was authorized to resell the soup
base to third parties under its private label
“Primarque” and under WWW's label,
“Cook's Delight.” As to the soup base it
prepared for Primarque's private label, WWW would affix
Primarque labels on the containers of soup base before
shipment. Primarque at no time had any ownership interest in
any of WWW's proprietary formulas or in WWW. Primarque
sold WWW's products under Primarque's private label.
Primarque would order product from WWW via purchase orders,
and WWW would deliver that product to Primarque or its
designated recipients. Primarque would then pay the invoiced
amount for the product to WWW.
Primarque entered into two distributor/supplier agreements,
one in 1987(“1987 Agreement”) and the other in
1990 (“1990 Agreement” and, together with the
1987 Agreement, the “Agreements”). The Agreements
each had three year terms and the parties did not enter into
a new agreement after the 1990 Agreement expired. Dorothy
decided not to enter into a new agreement in 1993 in order to
provide flexibility for WWW to work with other distributors
in the New England area. From June 30, 1993 until WWW
officially ended its relationship with Primarque on March 12,
2015 (the “End Date”), the parties maintained an
order-by-order, at-will relationship. That is, their
distribution arrangements were defined by written purchase
orders and invoices, which established the type of product
ordered, quantity of product ordered, cost of product, method
of shipping and the location to which the product was to be
delivered. Primarque was not obligated to buy its soup base
exclusively from WWW. WWW was aware that Primarque purchased
soup base from other suppliers.
Requests the Drop Ship Arrangement
different points in time in the parties' relationship,
Primarque asked WWW to ship soup base products directly to
certain customers (“Drop Ship Arrangement”). This
allowed Primarque to avoid having to receive, store,
refrigerate, and then re-ship product to the end customer.
The customers to which Primarque asked WWW to ship directly
are referred to as the Drop Ship Customers and included:
Plenus Group, Inc. (“Plenus”), Rana Meal
Solutions, LLC (“Rana”), Whole Foods Kitchen
(“Whole Foods”), Blount Fine Foods
(“Blount”), Joseph's Gourmet Pasta
(“Joseph's”), Nestle U.S.A.
(“Nestle”), Southern New England Spice Company
(“Southern New England Spice”), Shaw's
Southern Belle (“Shaw's”), Meritage Soups,
LLC (“Meritage”), West Valley Inn, Inland Market
Premium Foods (“Inland Foods”), Ivars, Greencore,
Ian's Natural Foods, Meninno Brothers, Boston Salads,
Cape Cod Chowder, Cameron's Seafood Market, Legal
Seafoods, Newbridge on the Charles (“Newbridge”),
Elevation Brands, Foxwood Casino and The Crab Trap. The Drop
Ship Customers advertised and also presented at food shows
and trade shows; the suppliers, including WWW, were aware of
these customers. The Drop Ship Arrangement saved Primarque
time and resources. For example, the Drop Ship Arrangement
allowed Primarque's pricing to be more competitive.
Primarque shared it pricing for its Drop Ship Customers with
WWW. Moreover, with respect to Plenus, up until the late
summer/early fall of 2014, Primarque arranged for Plenus to
submit its Primarque purchase orders directly to WWW.
Purported Oral Agreements with WWW's Prior and Current
Owners; The Non-Solicitation Agreement and Agreement to
Provide Notice of Termination.
alleges that he entered into an oral non-solicitation
agreement of unlimited duration and scope with Dorothy while
she was operating WWW. More specifically, according to
Primarque Dorothy agreed that in order to facilitate the Drop
Ship Arrangement, if Primarque disclosed the identity and
purchase needs of a Drop Ship Customer to WWW and Primarque
bought its soup base for that customer from WWW, WWW would
neither solicit business from the customer, nor sell its soup
base to that customer (whether by initiating the sale, or
being solicited by the customer), except through Primarque.
Based on this promise, Barron disclosed the name and purchase
needs of the Drop Ship Customers to WWW. Dorothy denies ever
having entered into an oral agreement with Barron and/or
Primarque. Also, according to Primarque, when the Quealys
took over WWW, they assured Primarque that none of WWW's
agreements with it would change, and all arrangements for
doing business together would remain the same. Both Georgeann
and Dorothy have testified that the Quealys did not purchase
WWW subject to any agreements or obligations with regard to
Primarque. While WWW sales staff were generally not aware of
the identity of Primarque's customers who received their
goods from WWW's warehouse, they were aware of the
identity of the Drop Ship Customers.
kept track of which customers were Primarque's customers,
and which were WWW's customers, and made sure that
Primarque was not selling to WWW's preexisting customers.
At the same time, during the period that Primarque served as
a WWW distributor, WWW employees never solicited business
directly from Primarque customers. Thus, if any Primarque
customer contacted WWW seeking to purchase soup base directly
from WWW, WWW did not accept the business and referred the
customer back to Primarque. Primarque also did not solicit
business from customers that had already been buying soup
base directly from WWW. If Primarque stopped ordering soup
base from WWW for a particular Drop Ship Customer, WWW could
then solicit business directly from that customer.
1990-93, the parties had a written private label agreement,
which included a provision that “[i]n the event of the
sale of either company, this Agreement will remain in effect
and be binding on either or both successor owners for a
period of one year from the date of sale.” The parties
did not renew the agreement after 1993. According to
Primarque, Dorothy orally agreed that if WWW intended to sell
its business to a third party or to close the business, WWW
would give Primarque one year notice.
also alleges that he entered into an oral agreement with
Georgeann when she and Brian purchased WWW in 2005. According
to Barron, the purported oral agreement included a
non-solicitation agreement of unlimited duration and scope
with an alleged obligation for WWW to provide 90-days'
notice if it closed or if the business was sold. Barron
testified that he and Georgeann entered into the purported
oral agreement on a phone call in 2005, but cannot articulate
the specifics surrounding the alleged call. Georgeann denies
entering into such an agreement. Primarque has described at
least three different versions of the alleged oral agreement
between it and WWW's current owners:
First, in the Amended Complaint, Primarque alleges that WWW
was obligated to provide Primarque 90-days' notice [to
allow for Primarque to secure substitute manufacturers] and
to refrain from doing business directly with Primarque's
customers, indefinitely, provided that Primarque sold
exclusively WWW products through Primarque's private
label in New England.
Second, Barron testified that WWW was obligated to provide
Primarque 90- days' notice if WWW sold or closed its
business, and to refrain from selling directly to the Drop
Ship Customers, indefinitely, provided that Primarque
provided WWW 90-days' notice if Primarque transitioned
customers to another supplier.
Third, in its Response to Request for Admission
(“RFA”) No. 15, Primarque alleges that the
purported non-solicitation agreement required WWW “not
to sell directly to any Primarque customer provided Primarque
was selling WWW products to that customer.”
also testified that he could not articulate how
Primarque's transition of business from WWW to other soup
base suppliers would affect WWW's alleged
repeated the third version of the alleged agreement in his
deposition, but limited WWW's alleged non-solicitation
obligation only to the Drop Ship Customers. He testified that
the alleged non-solicitation agreement required WWW not to
sell directly to any Drop Ship Customers provided Primarque
was selling WWW products to the Drop Ship Customers. Barron
further testified that WWW's obligation under the oral
agreement to provide Primarque 90-days' notice was
contingent on WWW selling or closing its business. Barron
testified that the parties never discussed and never agreed
that WWW was required to provide Primarque 90-days'
notice if the relationship soured and WWW decided to end its
relationship with Primarque.
Barron testified as follows:
Q. [F]rom your recollection, a minimum of 90 days' notice
of what occurrence?
A. If they [WWW] sold the business, closed the business,
stopped selling to Primarque.
Q. And specifically that was discussed, stop selling to
A. No. In essence, stopping to do business with Primarque
based on closing the business or selling.
Q. Okay. Because that's what all the e-mails include,
correct, and we're going to go through those?
A. I don't know. But it was about stopping to sell
Primarque, whether through a closing or a sale .....
Q. There wasn't any discussion about the relationship
A. No, there was no discussion of the relationship souring.
Court asked Primarque's counsel to explain the alleged
oral agreement during a hearing on October 11, 2016.
Primarque's counsel explained the agreement as follows:
“WWW was to provide Primarque 90-days' notice if it
ended its relationship with Primarque and refrain from ever
selling to the Drop Ship Customers; provided Primarque sold
exclusively WWW products to the Drop Ship Customers.”
According to Primarque's counsel, if Primarque sold other
competitors' products to the Drop Ship Customers, WWW was
“off the hook” in terms of its obligations under
the purported agreement.
statement of material facts, Primarque offers yet another
version of the agreement. Primarque asserts that in 2009,
while staffing the Boston Seafood Show together, Barron and
Georgeann discussed whether their children would eventually
take over ownership and operation of their respective
companies and discussed how long the Primarque and WWW
business relationship would continue. According to Primarque,
Georgeann assured Barron that WWW intended to do business
with Primarque indefinitely, and that if WWW was ever sold to
a third party or WWW otherwise intended to cease doing
business with Primarque, WWW would give Primarque at least
ninety (90) days' notice.
Requests WWW to Enter Into a New Agreement
September 23, 2009, Barron sent an e-mail to WWW including
the following language about an agreement Barron was
proposing to WWW:
Primarque wants to be given a 1 year notice in the event WWW
wants to discontinue selling private label products or
primarques (sic) customer label products to Primarque and
Primarque is willing to give WWW one year notice should they
[Primarque] seek to have their soup bases manufactured by a
company other than WWW. It is further understood that should
a current customer try to circumvent Primarque and go
directly to WWW this may only be done with permission of
Primarque. This agreement includes any future ...