Summary
finding that plaintiff could bring an unlawful attachment action as failure of garnishees to surrender attached property does "not conclusively establish that [plaintiff] was not deprived of the use of its property"
Summary of this case from Winklevoss Capital Fund, LLC v. ShremOpinion
01 Civ. 0765 (MBM)
December 5, 2002
STEVEN SKULNIK, ESQ., Pavia Harcourt, (Attorney for Counterclaim Plaintiff) New York N.Y.
DAVID A. CUTNER, ESQ., MICHAEL A. MCDONOUGH, ESQ., Cutner Associates, (Attorneys for Counterclaim Defendants), New York N.Y.
OPINION AND ORDER
In this diversity action, AdiPar Limited ("AdiPar") sues PLD International Corporation ("PLD") for breach of an agreement under which AdiPar sold Escada fragrance products to PLD and for breach of an agreement under which PLD repurchased Perry Ellis fragrance products from AdiPar. PLD counterclaims, alleging breach of contract, unjust enrichment, and wrongful attachment against AdiPar, as well as breach of contract, unjust enrichment, and tortious interference with contractual relations against Escada Beaute Ltd. ("EBL"). AdiPar and EBL move to dismiss the Second Amended Counterclaims ("Counterclaims") pursuant to Fed.R.Civ.P. 12(b)(6) or pursuant to Fed.R.Civ. p. 56(b). For the reasons stated below, the motion is granted in part and denied in part.
I.
The following facts are either undisputed or presented in the light most favorable to counterclaimant PLD. PLD is a Florida corporation and maintains its principal place of business in Florida. (Counterclaims ¶ 33.) AdiPar is a Delaware corporation and maintains its principal place of business in New York. ( Id. ¶ 34.) EBL is a Delaware corporation and maintains its principal place of business in New York. ( Id. ¶ 35.) AdiPar is an exclusive United States distributor of high-quality fragrance products such as the products manufactured by EBL. (Am. Compl. ¶ 5.) PLD is a distributor of fragrance and body products in primary and secondary markets worldwide. (Counterclaims ¶ 6.)
Beginning in early 1999, PLD negotiated an exclusive distribution agreement with Claude Palatin and other representatives of AdiPar and EBL. ( Id. ¶ 37.) On or about June 29, 1999, PLD and AdiPar signed the Distribution Agreement. ( Id. ¶ 38.) The two-page contract (Roeder Aff., Ex. A.), which covers all Escada fragrance and body products, begins with a prefatory statement: "The following is intended to define the terms of our agreement whereby AdiPar will grant PLD exclusive distribution rights for the United States `secondary market.'" ( Id. at 1.)
Under the heading "Territory/Client List," the Agreement states: "The agreement is for a defined list of retail and wholesale clients which PLD will provide to AdiPar for approval. AdiPar's approval of a customer on this list will 1) provide PLD with authorization to sell to this customer, and 2) guarantee to PLD that AdiPar will not sell directly to this customer without the agreement of PLD." ( Id.)
Under the heading "Cost Prices," the Agreement states: "AdiPar will sell to PLD first-quality regular catalog products at 75% off of suggested retail pricing." ( Id.) Under the heading "Mimmum Sales," the Agreement obligated PLD to purchase $3.6 million worth of goods from June 1, 1999 to December 31, 1999 and $4.5 million worth of goods from January 1, 2000 to December 31, 2000.
Finally, the Agreement provided that PLD would purchase Escada goods not only from AdiPar but also from other suppliers. Under the heading "Market Clean-up," the Agreement provides:
AdiPar understands that PLD will purchase Escada goods currently available on the secondary market from suppliers other than AdiPar at discounts up to 70% off the suggested retail pricing. AdiPar will allow PLD to deduct up to $600,000 in purchases it makes on the open market from the minimum purchase commitment for 1999. Furthermore, AdiPar guarantees that it will accept this stock from PLD and credit PLD its purchase price if PLD is unable to re-sell the merchandise.
( Id. at 2.)
According to PLD, when the parties entered into the Distribution Agreement, they agreed that AdiPar and other entities in the Escada group would support the "Market Clean-up" described in the contract. (Counterclaims ¶ 38.) Moreover, they understood, and Palatin acknowledged, that the "Market Clean-up" in the United States would not be successful in stabilizing prices unless EBL took action to control the unauthorized sale of goods in all territories. ( Id.)
Pursuant to the Distribution Agreement, AdiPar shipped to PLD $2.7 million worth of Escada goods by the end of 1999. (Dray Decl. ¶ 9.) Also, PLD engaged in the "Market Clean-up" by purchasing Escada products from the U.S. secondary market and overseas at 70% off retail ("the MCU products"). (Counterclaims ¶ 40.) From approximately June 29, 1999 to approximately December 1999, PLD purchased Escada brand products from the secondary market at a cost of over $1 million. ( Id. ¶ 43.) PLD claims that it was unable to resell these MCU products and tendered them to AdiPar along with a request that the cost of the items be credited against PLD's ongoing purchases of other Escada products. ( Id. ¶ 44.)
According to PLD, AdiPar did not accept the return of these products. ( Id. ¶ 54.) However, in March 2000 AdiPar did credit PLD's account $195,823.90, which represented the difference between the 70% discount on purchases of MCU products from the secondary market and the 75% discount that PLO was supposed to have received from AdiPar. (Dray Decl. ¶ 11.) Also, AdiPar sold Escada products in the U.S. secondary market (Counterclaims ¶¶ 52, 61.), although PLD gave AdiPar a list with its projected sales, which AdiPar approved. (Dray Decl. ¶ 8.)
On or about March 8, 2000, the parties modified the Distribution Agreement. ( Id. ¶ 39.) John Roeder of AdiPar summarized the amended agreement in a two-page letter to Phillippe Dray of PLD. ( See Roeder Aff., Ex. C.) Under the heading "2000 Purchase Plan," Roeder wrote:
You confirmed you will honor your 2000 purchase projection from AdiPar of $3,350K at 75% off retail if we supply you in addition $600K of goods billed at 88% off retail. This order will ship direct from France, and will be invoiced by Escada Beaute Ltd. Note: per our discussion today we will cut this entire program by 30% that is. we will cut the 75% off projection to $2,345K. and the 88% off order to $420K. The 88% off order will ship after the $2,345K is invoiced.
( Id. at 1.)
In addition to cutting the price of some goods to 88% off retail ("the Higher Margin Products") and the amount that PLD was required to purchase before earning the right to buy those goods, the amended agreement laid out terms for PLD's purchase of "Sport 15ml. Prepacks" and other products grouped in the category of "Closeouts and Returns." ( Id.) AdiPar never delivered the Higher Margin Products, Closeouts and Returns, and "Lily Chic" products to PLD. (Counterclaims ¶ 57; Dray Decl. ¶¶ 15-18; Roeder Reply Aff. ¶ 15.)
Although the text of the Distribution Agreement signed on June 29, 1999 mentions PLD and AdiPar only, PLD maintains that EBL controlled AdiPar's performance under the Agreement. PLD presents the following examples of EBL's involvement: First, representatives of EBL attended a meeting to discuss the parties' performance under the Agreement. (Counterclaims ¶ 46.) Second, in 1999, PLD requested that it be permitted to package, as a set, two products it was purchasing under the Distribution Agreement. ( Id. ¶ 47.) AdiPar informed PLD that it could not agree to PLD's proposal without approval from EBL. ( Id.) Third, the March 8, 2000 modification of the Distribution Agreement provided that "Escada" would ship and invoice certain Higher Margin Products. ( Id.) Fourth, invoicing for products showed that shipments of goods belonging to and/or controlled by EBL or its affiliates were delivered to PLD. ( Id.) Fifth, EBL apparently credited PLD $195,823.90 for MCU Products. ( Id.) Sixth, Palatin decided that AdiPar would delay the contemplated sale of "Lily Chic" products to PLD until June 2000 because the sales were not consistent with EBL's global marketing strategy. ( Id.) Finally, in August 2000, Roeder advised PLD that AdiPar would not deliver "Acte II" because there had been a decision by EBL to sell these goods directly both in the United States and abroad.
On January 31, 2001, AdiPar sued PLD International Corporation ("PLD") for breach of the Distribution Agreement and for breach of a separate agreement under which PLD repurchased Perry Ellis fragrance products from AdiPar. AdiPar alleged that PLD failed to pay an outstanding balance of $1,685,025 under the Distribution Agreement as well as a balance of $495,626 under the repurchase agreement. ( See Am. Compl. ¶¶ 10-12.) AdiPar's suit was filed just one day after PLD filed its own complaint against AdiPar in the Southern District of Florida.
On February 1, 2001, Judge Richard Owen granted AdiPar's motion for an ex parte order of attachment against PLD's property pursuant to Fed.R.Civ.Pro. 64 and Sections 6201 and 6212 of New York's Civil Practice Law and Rules ("CPLR"). On February 27, 2001, I denied AdiPar's motion to confirm the order of attachment on the grounds that some portion of PLD's claims against AdiPar might be sustained and that there was no showing that AdiPar would find it difficult to collect a judgment should it prevail. ( See McDonough Aff., Ex. A.) I also stayed the instant action to permit the District Court in Florida to consider AdiPar's motion to transfer.
On May 3, 2001, the District Court in Florida dismissed PLD's complaint on the ground that AdiPar was entitled to its choice of venue in New York. PLD then filed counterclaims in this court against AdiPar and EBL, which AdiPar and EBL moved to dismiss. On October 22, 2001, I ordered PLD to serve amended counterclaims alleging additional facts relating to the issue of an agency relationship between AdiPar and EBL. The Second Amended Answer and Counterclaims were served on November 2, 2001.
AdiPar and EBL now ask the court to dismiss these counterclaims in full for failure to state a claim under Fed.R.Civ.P. 12(b)(6), or, in the alternative, to grant summary judgment against PLD under Fed.R.Civ.P. 56. The parties' briefs assume that New York law controls. Such "implied consent . . . is sufficient to establish choice of law." Tehran-Berkeley Civil Envtl. Eng'rs v. Tippetts-Abbett-McCarthy-Stratton, 888 F.2d 239, 242 (2d Cir. 1989).
II.
Along with its motion to dismiss, AdiPar submits two affidavits and seven exhibits. Accordingly, this court may either exclude these submissions from consideration and decide the motion on the basis of the counterclaims alone or convert the motion into a motion for summary judgment under Rule 56. Before a district court converts a motion to dismiss into a motion for summary judgment, the court must be satisfied that the parties are not taken by surprise or deprived of a reasonable opportunity to contest facts averred outside the pleadings. Krijn v. Pogue Simone Real Estate Co., 896 F.2d 687, 689 (2d Cir. 1990). The Second Circuit has held that, after filing its own exhibits and affidavits in opposition to a motion to dismiss, a non-movant cannot claim to be caught by surprise when a motion to dismiss is converted. See Kennedy v. Empire Blue Cross Blue Shield, 989 F.2d 588, 592 (2d Cir. 1993)
Even if I declined to convert the motion, I could consider the June 29, 1999 Distribution Agreement, because it is central to PLD's counterclaims. See Brass v. American Film Technologies, 987 F.2d 142, 150 (2d Cir. 1987) (explaining that on a motion to dismiss the court may consider documents "of which plaintiffs had knowledge and relied on in bringing suit").
Here, PLD has submitted an affidavit and several exhibits in opposition to AdiPar's motion. In light of its submissions, PLD cannot claim to be surprised by the court's decision to convert the motion and consider the affidavits and exhibits submitted by the parties.
However, even when the parties have adequate notice, a Rule 12(b)(6) motion may be converted into a Rule 56 motion only if the issues to be resolved on summary judgment are "discrete and dispositive." S.E.C. v. Simonson, No. 96 Civ. 9695. 2000 WL 781084, at *1 (S.D.N.Y. Jun. 19, 2000); 2 James Wm. Moore et al., Moore's Federal Practice ¶ 12.34[3][a] (3d ed. 1999). Because some of the issues posed by AdiPar and EBL's motions, including the viability of PLD's unjust enrichment claim as well as the effect of the vacatur of Judge Owen's ex parte order of attachment, are discrete and dispositive, the motions are converted, and I will consider the affidavits and exhibits submitted by the parties.
Although AdiPar and EBL's motions will be adjudicated as motions for summary judgment, it should be emphasized that, before the parties have the opportunity to conduct discovery, the issues presented in a Rule 56 motion are seldom ripe for summary adjudication. See Hellstrom v. U.S. Dep't of Veterans Affairs, 201 F.3d 94, 97 (2d Cir. 2000). In deciding AdiPar and EBL's motions, I am mindful of the Second Circuit's warning that summary judgment is rarely granted before discovery, see id., and will deny AdiPar and EBL's motions to the extent that PLD could prove its case after further factual development. However, where the issues presented are sufficiently discrete that further discovery would have no bearing on their disposition, summary judgment is appropriate.
Summary judgment is appropriate when, "after drawing all reasonable inferences in favor of the party against whom summary judgment is sought, no reasonable trier of fact could find in favor of the non-moving party." Horn Hardart Co. v. Pillsbury Co., 888 F.2d 8, 10 (2d Cir. 1989). The movant for summary judgment "always bears the initial responsibility of informing the district court of the basis for its motion" and identifying which materials "demonstrate the absence of genuine issues of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once this showing has been made, the burden shifts to the non-movant who "must set forth facts showing that there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986).
III.
PLD contends that AdiPar and EBL breached the Distribution Agreement and the March 8, 2000 modification to the Agreement by violating the Agreement's guarantee of exclusivity, failing to accept the return of MCU Products, and failing to deliver Higher Margin Products to PLD.
As discussed in Section IV, PLD attempts to implicate EBL in AdiPar's breaches of the Distribution Agreement and the March 8 Amendment to the Agreement by arguing that AdiPar was an agent of EBL during the negotiation and performance of the Agreement. Thus, to the extent that the agency claim can be proven, PLD can hold both AdiPar and EBL liable for AdiPar's breaches of contract. For the sake of clarity, however, I refer mainly to AdiPar in this section.
A. Exclusivity
PLD alleges first that AdiPar breached the Distribution Agreement by selling Escada products in violation of the exclusive rights granted to PLD. In support of this claim, PLD points to the first sentence of the Distribution Agreement: "The following is intended to define the terms of our agreement whereby AdiPar will grant PLD exclusive distribution rights for the United States `secondary market.'" (Roeder Aff., Ex. A, at 1) According to PLD, this prefatory sentence, on its owns granted exclusive distribution rights in the United States secondary market to PLD, which AdiPar and EBL violated.
The plain language of the Distribution Agreement belies PLD's reading of the document. Following the prefatory sentence, the Distribution Agreement goes on to state: "The agreement is for a defined list of retail and wholesale clients which PLD will provide to AdiPar for approval. AdiPar's approval of a customer on this list will 1) provide PLD with authorization to sell to this customer, and 2) guarantee to PLD that AdiPar will not sell directly to this customer without the agreement of PLD." ( Id.) Under the straightforward terms of the contract, therefore, PLD's exclusivity rested on AdiPar's approval of particular clients. The contract's broad prefatory sentence, which specifically states that "the following" language defines the terms of the agreement, cannot be transformed into a contract in its own right independent of that "following" language, which contains the specific terms negotiated by the parties.
PLD attempts to bolster its interpretation of the prefatory sentence by introducing a May 3, 1999 letter stating that, under a potential agreement between the parties, "Adipar will no longer be selling direct to any account on the secondary market." (Dray Decl., Ex. 1, at 2) However, because the parties do not dispute that the Distribution Agreement is a fully integrated contract, and I find that the meaning of the contract is unambiguous, this evidence of intent is barred by the parol evidence rule. See e.g., Stone v. Schulz, 231 A.D.2d 707, 707, 647 N.Y.S.2d 822, 823 (2d Dep't 1996) ("It is well settled that where . . . the parties have reduced an agreement to writing, and the writing is clear in its terms and purports to express the parties' entire agreement, evidence of a prior or contemporaneous communication between the parties that contradicts, varies, or explains the agreement is generally barred by the parol evidence rule.")
PLD rightly asserts that a contract should be interpreted to give each of its provisions meaning. See Galli v. Metz, 973 F.2d 145, 149 (2d Cir. 1992). However, PLD's own interpretation of the contract violates that maxim. If the prefatory sentence granted PLD exclusive rights to the entire U.S. secondary market, the Territory/Client provision, which requires PLD to submit a customer list for approval, would be superfluous. On the other hand, if the Territory/Client provision is given full effect, the prefatory sentence still makes sense as an introductory statement.
PLD's own performance under the Distribution Agreement further undermines its interpretation of the Agreement. Cf. Margaret N. Kniffin, 5 Corbin on Contracts § 24.16 (rev. ed. 1998) ("In the process of interpreting a contract, the court can receive great assistance from the interpreting statements made by the parties themselves or from their conduct in rendering or in receiving performance under it."). PLD admits that it gave AdiPar a list of customers and claims that AdiPar approved the list. (Dray Decl. ¶ 8.) If the prefatory statement granted PLD exclusive rights in the U.S. secondary market, PLD's submission of the list for approval would have been unnecessary.
PLD's attempt to present the Territory/Client provision as a clause that refers to customers outside the secondary market only is unavailing. First, the prefatory statement definitively states that the contract as a whole was intended to grant PLD distribution rights in the secondary market. Second, in the Dray Declaration, PLD itself acknowledges that "Perfumania" and "Marshalls" are customers in the secondary market. (Dray Decl. ¶ 2.) Yet both of these customers were on the list submitted to AdiPar for approval. ( See Dray Decl., Ex. 2, at 1) If the Territory/Client provision covered only customers outside the secondary market, these customers would not have been on the list.
PLD's proposed interpretation of the Distribution Agreement is untenable. However, PLD's exclusivity claim as a whole cannot be dismissed, because PLD asserts that it presented a list of customers to AdiPar and that AdiPar approved that list. (Dray Decl. ¶ 8.) Moreover, PLD has presented evidence of the submission and approval of a customer list in the form of a list with specific customer names crossed out and a letter dated January 13, 2000 in which Phillippe Dray claimed that John Roeder had approved the customers on the list. ( See Dray Decl. ¶ 8; Dray Decl., Ex. 2; Roeder Aff., Ex. B.) AdiPar, on the other hand, maintains that PLD never provided it with a list of customers for approval, and that, in any event, AdiPar never approved any customer list or any specific customer. (Roeder Aff. ¶ 4) A genuine issue of material fact exists as to whether PLD submitted a list and whether AdiPar approved it.
Thus, PLD's exclusivity claim can go forward to the extent that it is based on the allegations that PLD submitted and gained approval of a list of customers and AdiPar nevertheless sold to those customers. Contrary to Adipar's contention, these allegations are not overly "conclusory" for the purposes of the present motion. Although PLD does not name the customers to which AdiPar allegedly sold Escada products in violation of the Distribution Agreement, imposing such a requirement on PLD before it has the opportunity to conduct discovery would be inconsistent with the Second Circuit's admonition that, on a Rule 56 motion, "[t]he nonmoving party must have `had the opportunity to discover information that is essential to his opposition' to the motion for summary judgment." Trebor Sportswear Co. v. The Limited Stores, Inc., 865 F.2d 506, 511 (2d Cir. 1989) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 n. 5 (1986)).
B. The MCU Products
PLD alleges next that, in violation of the "Market Clean-up" provision in the Distribution Agreement obligating AdiPar to "accept [MCU] stock from PLD and credit PLD its purchase price if PLD is unable to re-sell the merchandise," AdiPar refused to accept return of MCU Products or to credit PLD's account with the value of those products. According to PLD, although AdiPar credited PLD $195,823.90 for MCU Products purchased on the open market, an amount representing the difference between the 70% discount on purchases of MCU Products and the 75% discount that PLD received from AdiPar, AdiPar was obligated to accept the return of the goods and to reimburse PLD fully for its cash outlay of over $1 million. (Dray Decl. ¶ 11.)
In response, and in support of its motion for summary judgment, AdiPar contends that PLD never sought to return the MCU Products to AdiPar. Instead, PLD simply requested a credit of $195,823.90, which was granted. (Roeder Aff. ¶¶ 7-8.) Yet the evidence submitted by AdiPar to back up its version of the facts is insufficient to dispose of the genuine issue of material fact raised by PLD — namely whether PLD unsuccessfully sought to return the MCU Products to AdiPar in exchange for full reimbursement. The letter dated January 13, 2000 from Phillippe Dray to Nicholas Ratut of AdiPar does not expressly request a credit of $195,823.90. Rather, the letter requests that Ratut "be prepared to address the issue of the credit or the purchase of the goods that have been purchased on the gray market." (Roeder Aff., Ex. B, at 2.) For several reasons, the letter cannot be regarded as dispositive proof that AdiPar's obligation to reimburse PLD for the goods was excused. First, the letter does not rebut PLD's allegation that it had already asked "several times" for full reimbursement from AdiPar. (Dray Decl. ¶ 10.) Second, putting aside the question whether AdiPar was excused from its obligation to accept return of the goods, the letter says nothing about how the "credit" to PLD should be calculated. PLD contends that, after tendering the goods to AdiPar, it wanted the entire cost of the MCU Products to be "credited" against PLD's ongoing purchases of Escada Products. ( Id.) Nothing in the letter establishes that the "credit" requested was $195,823.90.
AdiPar submits also that PLD was not damaged by AdiPar's actions because PLD was able to resell the MCU Products at a profit. (Roeder Aff. ¶ 9.) However, PLD contends that the inventory list used by AdiPar to show that PLD earned a profit is incomplete and that Roeder did not circle all the items on the list that included MCU Products. (Dray Decl. ¶ 12.) Moreover, PLD presents its own inventory list, which shows a higher total of unsold Escada Products. (Dray Decl., Ex. 3) Thus, PLD has raised a genuine issue of material fact regarding the economic effect of AdiPar's alleged refusal to accept the return of MCU Products from PLD. PLD is entitled to prove that it attempted to return the MCU Products, and AdiPar refused to accept them.
PLD appears also to claim that, even if AdiPar's obligation to accept tender of the products had been excused, the $195,823.90 credit was too small because it does not account for the profit PLD would have made if it did not have to sell at deep discounts because of the over-supply caused by AdiPar and EBL's selling into the secondary market. (Dray Decl. ¶ 11.) This is simply a restatement of PLD's exclusivity claim. If PLD can prove that AdiPar and EBL infringed upon PLD's exclusive rights, it will be entitled to damages on that claim, including the damages arising from PLD's inability to sell products in a saturated market.
C. The Higher Margin Products
Finally, PLD alleges that AdiPar and EBL breached the March 8, 2000 modification of the Distribution Agreement by failing to sell Higher Margin Products to PLD. By letter dated March 8, 2000, AdiPar agreed to ship Higher Margin Products to PLD at 88% off retail price once PLD's projected purchases of $2.345 million were invoiced. AdiPar agreed also to ship "Sport 15ml Prepacks," Lily Chic products, and products grouped under "Closeouts and Returns." (Roeder Aff., Ex. E.)
AdiPar moves for summary judgment on the ground that its performance under the modified contract was excused by PLD's failure to meet the $2.345 million minimum purchase guarantee. PLD does not dispute its obligation to meet the minimum purchase guarantee in order to qualify for the Higher Margin Products. However, PLD argues that AdiPar prevented it from purchasing the requisite amount of products, and that, with the exception of the Higher Margin Products, AdiPar was required to deliver the other products covered by the contract without regard to any guarantee.
PLD offers two theories to support its contention that it would have met the minimum purchase requirement of $2.345 million had AdiPar and EBL upheld their end of the bargain. First, PLD argues that, because AdiPar and EBL decreased the value of Escada goods in the market by flooding the market with goods and refusing to participate in PLD's "clean-up" effort, AdiPar and EBL interfered with PLD's ability to purchase goods under the Distribution Agreement as modified in March 2000. (Dray Decl. ¶ 13.) Second, PLD argues that, if the value of MCU Products that AdiPar refused to repurchase and sell back to PLD is included in AdiPar's total purchases, PLD met the mandatory minimum. (Dray Decl. ¶¶ 13-14.).
In sum, PLD has adequately alleged that the condition precedent to its purchasing Higher Margin Products was excused by AdiPar and EBL's sales into the secondary market and refusal to repurchase and then resell MCU Products. A party "cannot escape liability by preventing the happening of the condition on which it was promised." Catherine M.A. McCauliff, 8 Corbin on Contracts § 40.17, at 580-81 (rev. ed. 1999); see also St. Louis Dressed Beef Provision Co. v. Md. Cas. Co., 201 U.S. 173, 181 (1906) (Holmes, J.) ("[I]t makes no practical difference. whether we say that the defendant by its conduct made performance of the conditions by the plaintiff impossible, and therefore was chargeable for the sum which it would have had to pay if those conditions had been performed, or answer . . . that performance of the conditions was waived."); Vanadium Corp. v. Fid. Deposit Co., 159 F.2d 105, 108 (2d Cir. 1947). Here, although AdiPar claims that the condition precedent to its performance under the contract — namely that PLD purchase $2.345 million worth of goods before buying Higher Margin Products — was not fulfilled, PLD is entitled to prove that the condition was excused by Adipar's breach of contract.
AdiPar asserts also that it is entitled to summary judgment on the Higher Margin Products claim because AdiPar in fact provided PLD with a pro rata credit of $196,000 based upon PLD's actual purchases in the amount of $1,013,000. (Roeder Aff. ¶ 12) In response, PLD argues that the $196,000 credit was insufficient because it is based on sales of $1,030,000 rather than $2.345 million, and because it does not properly account for the anticipated profit on PLD's sales. (Dray Decl. ¶ 15) Because PLD has alleged that AdiPar unlawfully prevented PLD from selling $2.345 million worth of goods, PLD's claim that the $196,000 credit was insufficient survives summary judgment. However, should PLD prove that AdiPar prevented it from selling $2.345 million worth of goods, the $196,000 that has already been paid to PLD would be relevant for the purpose of calculating damages.
The allegations that AdiPar failed to deliver Lily Chic products and "closeouts and returns" also survive the motion for summary judgment. No evidence has been presented that these sales, in contrast to the sales of Higher Margin Products, were conditioned on minimum purchases by PLD. Although AdiPar asserts that its decision not to ship these items "was properly based upon PLD being in arrears in its obligations to AdiPar," (Roeder Reply Aff. ¶ 15), the factual record on this issue has not been developed.
IV.
PLD attempts to implicate EBL in AdiPar's alleged breaches of the Distribution Agreement by alleging that EBL was AdiPar's principal during the negotiation and performance of the Agreement. PLD argues that an agency relationship, actual, implied, or apparent, has been adequately pleaded. With regard to the actual and implied agency claims, I agree. However, because PLD concedes that EBL was initially an undisclosed principal, the apparent agency claim must be dismissed to the extent that it is used to implicate EBL in AdiPar's breach of the original Distribution Agreement.
A. Actual and Implied Authority
"Actual authority `is created by direct manifestations from the principal to the agent, and the extent of the agent's actual authority is interpreted in the light of all circumstances attending these manifestations, including the customs of business, the subject matter, any formal agreement between the parties, and the facts of which both parties are aware.'" Peltz v. SHB Commodities, Inc., 115 F.3d 1082, 1088 (2d Cir. 1997) (quoting Demarco v. Edens, 390 F.2d 836, 844 (2d Cir. 1968)) "Implied authority may be viewed as actual authority given implicitly by a principal to his agent or as a kind of authority arising solely from the designation by the principal of a kind of agent who ordinarily possesses certain powers." Marfia v. T.C. Ziraat Bankasi, N.Y. Branch, 100 F.3d 243, 251 (2d Cir. 1996) (internal quotation marks omitted).
A principal can be disclosed or undisclosed. An undisclosed principal is a principal whose existence and identity is not revealed to a third party transacting business with the undisclosed principal's agent. Old Republic Ins. Co. v. Hansa World Cargo Serv., Inc., 51 F. Supp.2d 457, 471 (S.D.N.Y. 1999). An agent's actions within its prescribed authority bind an undislosed principle, even if the principal is not named in the contract on which an agent is being sued. See id.; Restatement (Second) of Agency § 190 (1958) ("An undisclosed principal may be liable upon a simple contract in writing, although it purports to be the contract of the agent."). Thus, EBL's argument that it cannot be liable on an agreement it did not sign is unpersuasive.
EBL contends that the court would somehow violate the parol evidence rule by considering PLD's agency claim. However, PLD is arguing that EBL was an undisclosed party to the contract, not that the terms of the contract should be varied.
Under New York law, the question of the existence and scope of an agency relationship is a factual issue that cannot be adjudicated on the pleadings. Old Republic, 51 F. Supp.2d at 471; Heredia v. United States, 887 F. Supp. 77, 80 (S.D.N.Y. 1995); Maurillo v. Park Slope U-Haul, 194 A.D.2d 142, 147, 606 N.Y.S.2d 243, 247 (2d Dep't 1993). Here, PLD claims that EBL was Adipar's undisclosed principal and offers factual allegations to back up this claim. PLD alleges, inter alia, that representatives of EBL met with PLD officials to discuss performance under the Distribution Agreement and that AdiPar told PLD that it could not agree to proposals without consulting EBL.
EBL denies some of these allegations, and argues that other allegations are not sufficient to demonstrate that AdiPar was EBL's agent. However, despite asking for conversion of the motion, EBL presents no evidence to rebut the allegations that it denies. Thus, at this stage of the litigation, before PLD has an opportunity to discover further facts, summary judgment on the actual or implied agency claims would be inappropriate. See Teevee Toons, Inc. v. Gerhard Schubert GMBH, No. 00 Civ. 5189, 2002 WL 498627, at *3 (S.D.N.Y. Mar. 29, 2002) (emphasizing that, at the pleading stage of an agency action, all inferences must be drawn in favor of a party alleging actual agency).
The two cases primarily relied on by EBL do not undermine this conclusion. In Muang Ng We Massive Atlantic Ltd. v. Merrill Lynch Co., No. 99 Civ. 9687, 2000 WL 1159835 (S.D.N.Y. Aug. 15, 2000), the plaintiff alleged only that a third-party was consulted by the defendant. The plaintiff failed to make allegations supporting the conclusion that the third party controlled the defendant and actually used language in its complaint suggesting the opposite. Id. at *78. Here, by contrast, PLD alleges that EBL controlled crucial aspects of AdiPar's performance under the Distribution Agreement. Moreover, in Comind, Companhia de Seguros v. Sikorsky Aircraft Division of United Technologies Corp., 116 F.R.D. 397 (D. Conn. 1987), the other case relied on by EBL, the Court merely suggested that control over the price of goods does not conclusively establish an agency relationship. See id. at 403. However, PLD alleges not only that EBL controlled the price and distribution of its products, but also that EBL controlled AdiPar's decision-making during the negotiation and the performance of the Distribution Agreement.
Thus, PLD has adequately alleged actual and implied agency. If PLD can now prove that AdiPar was an actual or implied agent of EBL, EBL will be liable for any of AdiPar's breaches of the Distribution Agreement.
B. Apparent Authority
PLD's apparent authority claim, on the other hand, must be dismissed with regard to the original Distribution Agreement. "Apparent authority . . . arises when a principal places an agent in a position where it appears that the agent has certain powers which he may or may not possess. If a third person holds the reasonable belief that the agent was acting within the scope of his authority and changes his position in reliance on the agent's act, the principal is estopped to deny that the agents act was not authorized." Marfia, 100 F.3d at 251.
As a general rule, an apparent authority claim requires that a principal use words or engage in conduct that creates an appearance and belief that the agent possesses authority to enter into a transaction on its behalf. See Standard Funding Corp. v. Lewitt, 89 N.Y.2d 546, 551, 656 N.Y.S.2d 188 (1997) ("Essential to the creation of apparent authority are words or conduct of the principal, communicated to a third party, that give rise to the appearance and belief that the agent possesses authority to enter into a transaction.") (internal quotation marks omitted); accord Wood v. William Carter Co., 273 A.D.2d 7, 7, 708 N.Y.S.2d 107, 107-08 (1st Dep't 2000); Pyramid Champlain Co. v. R.P. Brosseau Co., 267 A.D.2d 539, 544, 699 N.Y.S.2d 516, 522 (3d Dep't 1999). However, courts have recognized an exception to this rule "where the principal has voluntarily placed the agent in such a situation that a person of ordinary prudence conversant with business usages and the nature of the particular business may be justified in assuming that such agent has authority to perform a particular act . . . ." Graffman v. Delecea, No. 96 Civ. 7270, 1997 WL 620833, at *5 (S.D.N.Y. Oct. 8, 1997)
Here, PLD alleges that it had some contact with EBL representatives before it entered into the Distribution Agreement. ( See Counterclaims ¶¶ 37-38 (alleging that EBL representatives were present during the negotiation of the Distribution Agreement and that EBL representatives agreed that EBL would work to stabilize prices along with PLD).) However, PLD insists that, when it entered into the Distribution Agreement, EBL was an undisclosed principle. ( See Counterclaims ¶ 47 (stating that the agency relationship "became apparent" during the performance of the agreement); id. ¶ 48 (stating that the agency relationship was undisclosed).) Moreover, PLD does not suggest that a person of ordinary prudence would assume that AdiPar was an agent when it negotiated the agreement. Thus, even on its own factual allegations, PLD cannot assert that AdiPar was an apparent agent of EBL when it signed the Distribution Agreement. See Hirsch v. Arthur Andersen Co., 72 F.3d 1085, 1095 (2d Cir. 1995) (affirming dismissal of a complaint where "attenuated allegations" supporting a claim "are contradicted by more specific allegations in the Complaint").
On the other hand, the apparent authority claim survives with regard to AdiPar's alleged breach of the March 8, 2000 Amendment to the Distribution Agreement. PLD adequately alleges that, between the time that the parties signed the Distribution Agreement on June 29, 1999 and the time they modified it on March 8, 2000, EBL's words and conduct gave rise to the appearance and belief that AdiPar was its agent. ( See id. ¶ 47) Indeed, the modified agreement, as reflected in the March 8 letter, specifically directs EBL to ship and invoice Higher Margin Products. ( See Roeder Aff., Ex. E.)
V.
PLD claims that AdiPar and EBL were unjustly enriched by PLD's expenditure of over $1 million to purchase MCU Products. According to PLD, AdiPar and EBL took advantage of these expenditures to sell into a market that was temporarily supported by PLD's "clean-up" efforts. (Counterclaims ¶ 67.) In order to recover for unjust enrichment, a claimant must establish (1) that the defendant was enriched; (2) that such enrichment was at plaintiff's expense; and (3) that equity and good conscience demand that the defendant return the money or property to the plaintiff. Dolmetta v. Uintah Nat'l Corp., 712 F.2d 15, 19 (2d Cir. 1983).
Because unjust enrichment is a quasi-contractual remedy, "[t]he existence of a valid and enforceable written contract governing a particular subject matter ordinarily precludes recovery . . . for events arising out of the same subject matter." Clark-Fitzpatrick, Inc. v. Long Island R.R., 70 N.Y.2d 382, 388, 521 N.Y.S.2d 653, 656 (1987); see also Bradkin v. Leverton, 26 N.Y.2d 192, 197, 309 N.Y.S.2d 192, 195 (1970) ("[A] quasi-contractual obligation is one imposed by law where there has been no agreement."). Here, PLD does not dispute the validity or scope of the Distribution Agreement; indeed, PLD has proposed an especially broad interpretation of the Agreement's exclusivity and "Market Clean-up" provisions.
PLD argues that because, under AdiPar's interpretation of the Distribution Agreement, the Agreement did not absolutely bar AdiPar from selling in the secondary market, there is a disputed issue of fact regarding the scope of the Agreement. The defect in this argument is that there is no dispute here over whether the contract governs the supply relationship between AdiPar and PLD. See Joseph Steinberg, Inc. v. Walber 36th St. Assocs., 187 A.D.2d 225, 228, 594 N.Y.S.2d 144, 146 (1st Dep't 1993) (holding that a plaintiff may proceed on a theory of quantum meruit only "where there is a bona fide dispute as to the existence of a contract or where the contract does not cover the dispute in issue"). The parties to this action agree that they executed a valid contract that lays out the respective rights and responsibilities of the parties in the U.S. secondary market for Escada products. The crux of their dispute is what those rights and responsibilities are. Unlike in Sterberg, for example, where the applicable contract did not cover the situation that arose — i.e., a situation in which a broker facilitated a transaction for his client at a better price than the brokerage contract envisioned and the client attempted to pay the broker nothing — the contract at issue in this case spells out the terms of the supply relationship between AdiPar and PLD. PLD cannot plead unjust enrichment claim in order to adjust those terms ex post.
The unjust enrichment claim against EBL must be dismissed on the same grounds. A written contract covering the subject matter of a dispute precludes recovery in quasi-contract "whether the contract is one between parties to the lawsuit, or where one party to the lawsuit is not a party to the contract." Granite Partners, L.P. v. Bear Stearns Co., 17 F. Supp.2d 275, 311 (S.D.N.Y. 1998); see also, e.g., Mina Inv. Holdings, Ltd. v. Lefkowitz, 16 F. Supp.2d 355, 361 (S.D.N.Y. 1998); ABF Capital Mgmt. v. Askin Capital Mgmt., 957 F. Supp. 1308, 1334 (S.D.N.Y. 1997); Salomon v. Hampton Athletic Club, 245 A.D.2d 282, 282-83, 666 N.Y.S.2d 19 (2d Dep't 1997).
In the case at bar, the Distribution Agreement covers the subject matter of the dispute between the parties. If PLD can prove that Escada was an undisclosed party to the contract and that EBL breached the contract, then EBL can be held liable for breach of contract. Likewise, if PLD can prove that EBL tortiously interfered with the contract between PLD and AdiPar, EBL can be held accountable for its interference. However, because PLD's rights and responsibilities were memorialized in a valid contract, PLD's unjust enrichment claim against EBL may not go forward.
Relatedly, "[i]t is well settled that in order to recover under a theory of quasi contract, a plaintiff must be able to prove that performance was rendered for the defendant, resulting in its unjust enrichment." Metropolitan Elec. Mfg. Co. v. Herbert Const. Co., Inc., 183 A.D.2d 758, 759, 585 N.Y.S.2d 497, 498 (2d Dep't 1992). In this case, PLD contracted to "clean up" the secondary market for AdiPar, not for EBL. Unless PLD can prove that EBL was an undisclosed party to the contract, in which case PLD would have a breach of contract claim against EBL, PLD did not render performance for EBL.
VI.
In its third amended counterclaim, PLD alleges that "[a]s a direct and proximate result of AdiPar's obtaining an ex parte order of attachment to which it was not entitled, PLD was forced to incur attorneys' fees in excess of $18,000 in order to vacate the attachment." (Counterclaims ¶ 74.) In its fourth amended counterclaim, PLD asserts that the ex parte order of attachment led some of PLD's customers to terminate or alter their business relationships with PLD, caused PLD's suppliers to change their credit terms to PLD's detriment, and caused PLD's customers to withhold payments of funds due to PLD. PLD seeks damages under sections 6212(e) and 6212(b) of the CPLR. Section 6212(e) provides that "[t]he plaintiff shall be liable to the defendant for all costs and damages, including reasonable attorney's fees, which may be sustained . . . if it is finally decided that the plaintiff was not entitled to the attachment of the property." CLPR § 6212(e). Section 6212(b) provides that a motion for an order of attachment, the plaintiff shall give an undertaking . . . a specified part thereof conditioned that the plaintiff shall pay to the defendant all costs and damages . . . if it is finally decided that the plaintiff was not entitled to an attachment . . . ." CPLR § 6212(b).
AdiPar argues that because none of PLD's property was attached between the time of Judge Owen's ex parte order and this court's vacatur of the order, and actual attachment is a prerequisite to a wrongful attachment claim, PLD's wrongful attachment claim should be dismissed. To support its claim that no property was attached, AdiPar offers an affidavit by Michael A. McDonough, an attorney for AdiPar, stating that Desiree Corbin of the United States Marshals Service told McDonough that no money or property of PLD's had been attached, and that a subsequent review of the 29 USM statements that had been served on and returned by each garnishee confirmed that none of the garnishees possessed any property or money of PLD. (McDonough Aff. ¶ 2.).
In response, PLD asserts that several of its customers informed Phillippe Dray that they would not pay outstanding invoices because of the attachment. (Dray Decl. ¶ 20.) Also, customers terminated or altered their business relationships with PLD as a result of the ex parte order. ( Id.)
The applicable case law supports AdiPar's position that the actual attachment of property is a prerequisite to maintaining a cause of action for damages under New York law. In Kidder, Peabody Co. v. IAG Int'l Acceptance Group, 28 F. Supp.2d 126, 144-46 (S.D.N.Y. 1998), the defendant obtained an ex parte order of attachment, but the order was vacated by consent of the parties before any property was encumbered. The District Court held that where a valid ex parte order of attachment does not result in the encumbrance of property, New York law precludes a wrongful attachment suit under section 6212(e) of the CPLR, and dismissed the claim.
Although Kidder, Peabody was decided under CPLR § 6212(e), the same analysis applies under § 6212(b). See Rashi Textiles, U.S.A., Inc. v. Rhomberg Textile Gesellschaft M.B.H., 857 F. Supp. 1051, 1052 n. 1 (S.D.N.Y. 1994) (noting that sections 6212(e) and 6212(b) "require an identical analysis with respect to whether the attachment was wrongful")
Similarly, in Salamanca Trust Co. v. McHugh, 156 A.D.2d 1007, 550 N.Y.S.2d 764 (4th Dep't 1989), the plaintiff obtained an oral order of attachment that was never signed or entered. However, once the application was orally granted, the defendant placed the assets at issue in escrow pending resolution of the lawsuit. Id. at 1007. Nevertheless, the court dismissed the defendant's counterclaim of wrongful attachment, holding: "The mere fact that property has been subjected to some form of restraint does not serve as a basis for the statutory claim of wrongful attachment." Id. at 1008.
Citing Kidder, Peabody and Salamanca, AdiPar contends that PLD's wrongful attachment claim must be dismissed because I vacated the ex parte order of attachment. I disagree. This court recently examined the issues posed by PLD's wrongful attachment claim in First Merchant Bank Osh, Ltd. v. Village Roadshow Pictures (U.S.A.), Inc., No. 01 Civ. 8370, 2002 WL 1423063 (S.D.N.Y. Jun. 28, 2002). In that case, the defendant ("Roadshow") had obtained an order of attachment against the plaintiff ("FMB") in the context of Roadshow's suit against a third party. FMB argued unavailingly that the attached bank account contained none of the third party's property. Ultimately, the attachment action was discontinued just before a final scheduled hearing on FMB's motion to vacate. When FMB subsequently sued in federal court for wrongful attachment, the District: Court rejected Roadshow's contention that FMB's Complaint did not adequately plead wrongful attachment because the sheriff had not levied on the attached property. The Court reasoned that, if a wrongful attachment claim is dependent on a levy by a sheriff, "any party may wrongfully attach the property of another by procuring a court order which enjoins the garnishee from taking any action relating to that property but evade the consequences of its interference simply by neglecting to have the sheriff levy." Id. at *9.
The First Merchant Bank Court emphasized that, unlike the Courts in Kidder, Peabody and Salamanca, it was dealing with a situation in which "a court had actually issued an order of attachment, and the party whose assets were thus encumbered was actually deprived of the use of its property." Id. The only reason that the sheriff never levied the property was that the parties agreed to an accommodation in order to avoid the expense of the sheriff's levy. Id. Thus, the Court's holding can be formulated as follows: A plaintiff who has involuntarily been deprived of the use of its property may bring a wrongful attachment claim under CPLR § 6212(e).
PLD alleges that some of the customers who received orders of attachment on February 6, 2001 owed money to PLD and that the orders served on these customers prevented PLD from collecting its receivables. (Counterclaims ¶ 80; Dray Decl. ¶ 20.) Adipar responds by imploring this court to look at the USM 285 forms returned by the garnishees and held by the U.S. Marshall's Office. According to AdiRar, these forms show that PLD's property was never attached.
The U.S. Marshal's Office for this District has the USM 285 forms referenced by Adipar. Attached to each of these forms is the following statement: "I hereby certify and return that on March 2, 2001, I received a statement, copy attached, from David A. Cutner of Cutner Associates, P.C., attorney for plaintiff, stating that the court has denied AdiPar's motion to confirm Order of Attachment and therefore garnishees are no longer required to comply with the order. I, therefore, have received no funds or property belonging to the defendant." This court may take judicial notice of these records. See 11 James Wm. Moore Moore's Federal Practice ¶ 56.14[3] (3d ed. 1999) ("A court may . . . take judicial notice of its own records in the instant case as well as other cases, and must take judicial notice when a party properly directs its attention to the records in question and the material provides factual information not subject to reasonable question.")
The USM 285 forms indicate that the parties who received notice of the ex parte order did not turn over any property to the U.S. Marshall's office once they were informed by counsel that the order was not confirmed. Contrary to AdiPar's claim, however, they do not establish that the garnishees had no property owned by defendant when they received the initial order of attachment. Unlike in Kidder, Peabody, where the ex parte order of attachment was voluntarily vacated after a garnishee stated that it had no property belonging to the defendant, Kidder, Peabody, 28 F. Supp.2d at 129, no evidence has been presented here showing that PLD was not restrained from collecting its property from the garnishees once the ex parte order was entered and before the garnishees received notice that the order was not confirmed. Further, unlike in Salamanca, a valid order of attachment was issued in this case. It is plausible that, as PLD claims, the garnishees controlled property owned by PLD, and that they withheld that property from PLD so that they could turn it over to the U.S. Marshal within the prescribed time period if necessary.
Following the First Merchant Bank Court, I conclude that, where a plaintiff alleges that an ex parte order of attachment actually deprives the plaintiff of the use of its property, the plaintiff can bring an unlawful attachment action. The USM forms demonstrate only that the 29 garnishees never turned over PLD's property because the attachment order was vacated. The forms do not conclusively establish that PLD was not deprived of the use of its property. On this point, PLD has raised a genuine issue of material fact that cannot be disposed of without further factual development.
VII.
Finally, PLD alleges that, assuming EBL was not an undisclosed party to the Agreement between AdiPar and PLD, EBL tortiously interfered with the Agreement as a third party. Under New York law, a prima facie case of tortious interference with an existing contract requires allegations of (1) a valid contract between plaintiff and a third party; (2) the defendant's knowledge of that contract; (3) the defendant's intentional procuring of the breach; and (4) damages. Foster v. Churchill, 87 N.Y.2d 744, 749-50, 642 N.Y.S.2d 583, 586 (1996); accord Antonio A. Alevizopoulos and Assocs. v. Comcast Int'l Holdings, 100 F. Supp.2d 178, 186 (S.D.N.Y. 2000)
EBL argues that PLD's allegations of tortious interference are "conclusory" and cites Wolf v. Rare Medium, Inc., No. 01 Civ. 4279, 2001 WL 1448476 (S.D.N.Y. Nov. 15, 2001) for the proposition that conclusory allegations must be dismissed. However, in Wolf, the plaintiff made no allegations to support his assertions that a contract had been breached, that defendant knew about the contract, or how defendant caused the breach. Id. at *3 Here, by contrast, the counterclaims assert that AdiPar breached the Agreement by, inter alia, selling in violation of the Agreement's exclusivity, failing to deliver discounted goods and close out and return items, refusing to accept the return of the MCU Products, and refusing to credit PLD's account with the value of the MCU products. Further, the counterclaims assert that EBL knew about the Agreement and controlled AdiPar's compliance and noncompliance with the Agreement either as a principal or as a tortfeasor. ( See Counterclaims ¶ 47). The counterclaims are not conclusory.
In its Reply, EBL contends also, for the first time, that the counterclaims should be dismissed because PLD has made no allegation that EBL's interference was "solely malicious." The court need not consider arguments raised for the first time in a reply brief. See, e.g., Playboy Enters. v. Dumas, 960 F. Supp. 710, 720 n. 7 (S.D.N.Y. 1997) ("Arguments made for the first time in a reply brief need not be considered by a court.") (collecting cases)
In any event, PLD has alleged that EBL "maliciously" interfered with the Distribution Agreement. ( See Counterclaims ¶ 70). That allegation is sufficient. See Preferred Health Care, Ltd. v. Empire Blue Cross Blue Shield, No. 94 Civ. 9326, 1997 WL 160489, at *3 (S.D.N.Y. Apr. 7, 1997) (a counterclaim alleging that plaintiffs acted "with malice" was sufficient to withstand a Rule 12(b)(6) motion to dismiss); Shaker Loudon Assocs. v. Burlington Coat Factory Warehouse Corp., No. 94 Civ. 0901, 1996 WL 189504, at *1 (S.D.N.Y. Apr. 16, 1996) (a complaint properly alleged malice on the part of a corporate parent by claiming that "[d]efendant's interference with the Lease was without legal or moral justification . . . and an outrage warranting the imposition of punitive damages").
Also, under New York law, the allegation of malice appears to be required only where the defendants have an economic interest in the contract between a plaintiff and a third party. Foster, 87 N.Y.2d at 750-51, 642 N.Y.S.2d at 587 (finding that, where defendant has an economic interest in a contract, liability will be imposed only where plaintiff can make a showing of malice on the one hand or fraudulent or illegal means on the other) accord Drummond v. Morgan Stanley, No. 95 Civ. 2011, 1996 WL 631723, at *1 (S.D.N.Y. Oct. 31, 1996). The economic interest defense has not yet been raised here.
* * *
For the reasons stated above, AdiPar and EBL's motion for summary judgment on defendant's counterclaims is granted in part and denied in part. The unjust enrichment claim against both AdiPar and EBL is dismissed. Moreover, the breach of contract claim against both AdiPar and EBL is dismissed to the extent that it is based on the prefatory sentence of the Distribution Agreement, and the claim that EBL breached the original Distribution Agreement is dismissed to the extent that it is based on an apparent authority theory. Summary judgment is denied with respect to the remaining counterclaims..