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LOMAGLIO ASSOCS. v. LBK MKTG. CORP.

July 5, 1995

LOMAGLIO ASSOCIATES INCORPORATED, Plaintiff, against LBK MARKETING CORP., Defendant.

KEVIN THOMAS DUFFY, U.S.D.J.


The opinion of the court was delivered by: KEVIN THOMAS DUFFY

KEVIN THOMAS DUFFY, D.J.:

 Plaintiff originally brought this action in New York state court. On May 3, 1994 Defendant removed the case to this court pursuant to 28 U.S.C. §§ 1441, 1446, based on diversity of citizenship of the parties, 28 U.S.C. § 1332. On January 26, 1995, I denied Defendant's motion to dismiss the complaint pursuant to Fed. R. Civ. P. 12(b)(2), but granted its motion to dismiss the second cause of action for failure to plead fraud with the particularity required by Fed. R. Civ. P. 9(b), and for failure to state a claim upon which relief may be granted, pursuant to Fed. R. Civ. P. 12(b)(6). Plaintiff was ordered to serve an amended complaint within twenty days, which it timely filed. Defendant filed the present motion to dismiss the amended complaint pursuant to Rules 9(b) and 12(b)(6).

 For the following reasons, Defendant's motion is granted in part and denied in part.

 I.

 In determining a defendant's motion to dismiss a complaint pursuant to Rule 12(b)(6), all factual allegations in the complaint should be construed to the plaintiff's benefit. See Scheuer v. Rhodes, 416 U.S. 232, 236, 40 L. Ed. 2d 90, 94 S. Ct. 1683 (1974). Only if there exists no set of facts which would entitle the plaintiff to relief should the complaint be dismissed. Conley v. Gibson, 355 U.S. 41, 45-46, 2 L. Ed. 2d 80, 78 S. Ct. 99 (1957). Consequently, all factual allegations in the amended complaint will be presumed true for purposes of this motion.

 Neither Plaintiff Lomaglio Associates Incorporated ("LAI") nor Defendant LBK Marketing Corporation ("LBK") is a citizen of New York. LAI is a corporation organized under the laws of New Jersey, while LBK is a corporation organized under the laws of Ohio. On or about October 12, 1992, Plaintiff and Defendant entered into a written contract by which the parties agreed that LAI would be LBK's exclusive sales representative to Avon Products Incorporated ("Avon"). Avon is a corporation having its headquarters in New York City.

 In a letter to Avon dated November 11, 1992, David Gleason, LBK's Vice President National Accounts, represented that LBK had the capacity to produce 3,000 "Mrs. Albee" figurines per week. At meetings held on April 22, 1993 and May 24, 1993 in New York City, Gleason represented to both Plaintiff and representatives of Avon that LBK had the ability and desire to produce the figurines. On or about May 24 - 26, 1993, Plaintiff and Defendant agreed that should Avon award Defendant an order for "Mrs. Albee" figurines, Defendant would pay Plaintiff a commission of $ 1.555 per figurine ordered. In June 1993, Avon placed an order for 82,400 "Mrs. Albee" ceramic figurines with Defendant. Gleason and David Bailys, LBK's President, acknowledged Avon's order by a letter dated June 8, 1993. The total commission due to Plaintiff amounted to $ 128,132.

 In a July 12, 1993 memorandum addressed to LAI, Gleason proposed a shipping schedule for delivery of the figurines and reiterated LBK's ability and intent to produce the figurines. On August 11, 1993, Gleason again met with Plaintiff and representatives of Avon at Avon's New York City location, at which time he stated that production of the figurines would commence shortly before Thanksgiving 1993, with monthly shipments of 3,200 figurines to commence that December. At some point prior to September 1, 1993, Defendant shipped sample figurines to Avon in New York City.

 In a letter dated September 1, 1993, Gleason made assurances to Avon that Avon would receive figurines "of great beauty and quality." (Amd. Compl. P 19). However, nine days later, Defendant informed both LAI and Avon that it would not produce the figurines.

 According to the amended complaint, the aforementioned representations made on behalf of Defendant were known by Defendant's representatives to be false at the time they were made. Allegedly, Plaintiff relied to its detriment on the false representations about its intent and ability to provide the figurines to Avon. Plaintiff has unsuccessfully sought payment of the $ 128,132 commission from Defendant. Moreover, as a result of Defendant's refusal to produce the figurines, Plaintiff's business relationship with Avon has been damaged.

 II.

 DISCUSSION

 A. Breach of Contract ...


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