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Wolf Concept S.A.R.L. v. Eber Bros. Wine and Liquor Corp.

August 17, 2010

WOLF CONCEPT S.A.R.L, PLAINTIFF,
v.
EBER BROS. WINE AND LIQUOR CORP., NATIONAL DISTRIBUTING COMPANY, INC., EBER-NDC, LLC, LESTER EBER AND DAVID EBER, DEFENDANTS.



The opinion of the court was delivered by: Michael A. Telesca United States District Judge

DECISION and ORDER

INTRODUCTION

Plaintiff Wolf Concept S.A.R.L, ("Wolf Concept" or "Plaintiff") brings this action pursuant to New York statutory and common law claiming that the remaining defendants in this case*fn1, Eber Bros. Wine and Liquor Corp. ("Eber Bros."), Eber-NDC, LLC ("Eber-NDC"), Lester Eber and David Eber ("The Ebers"), (all collectively referred to as the "Eber Defendants" or "Defendants") have conspired to unlawfully restrain trade and competition in violation of New York's Donnelly Act (New York General Business Law §§ 340 - 347), tortiously interfered with Plaintiff's contractual relationships, and engaged in fraud and breach of contract.

The Eber Defendants move for judgment on the pleadings dismissing Plaintiff's Amended Complaint*fn2 pursuant to Rule 12(c) of the Federal Rules of Civil Procedure on grounds that Wolf Concept has failed to state any claims upon which relief can be granted. Specifically, the Eber Defendants contend that Plaintiff has:

(1) failed to allege the necessary elements of a Donnelly Act claim; (2) failed to allege that the Eber Defendants used wrongful means to interfere with Plaintiff's contracts; (3) failed to plead its fraud claim with the requisite particularity required under Rule 9(b) of the Federal Rules of Civil Procedure; (4) improperly attempted to plead a fraud claim that is nothing more than a veiled breach of contract claim; and (5) failed to state a viable breach of contract claim because by its own terms, the underlying agreement automatically terminated. Wolf Concept opposes the Eber Defendants' Motion.

For the reasons set forth below, the Court grants the Eber Defendants' Motion in part and dismisses the First, Second, Third and Fourth Causes of Action set forth in the Amended Complaint, and denies the Defendants' Motion with respect to the Fifth Cause of Action for breach of contract. Thus, the only claim that remains is Plaintiff's breach of contract claim against defendant Eber Bros.

BACKGROUND

The following facts are not disputed or are presumed to be true for the purposes of the Court's analysis of the Defendants' Motion. Plaintiff Wolf Concept is a French company that manufactures and distributes premium vodka distilled in Holland and bottled in France. During the time at issue set forth in the Amended Complaint, Plaintiff had an exclusive, albeit temporary, license to use the name "Petrossian" and market an "ultra-premium" brand of European vodka known as "Petrossian Vodka."

Wolf Concept obtained this temporary license from Petrossian, Inc. and related Petrossian companies (hereinafter collectively "Petrossian, Inc.") by agreement dated July, 2004 (hereinafter the "Licensing Agreement"). The Licensing Agreement specifically references the relationship to be formed with Eber Bros. to distribute the vodka in New York State and Delaware (the "Territory")*fn3 .

Petrossian Vodka had never before been sold in the U.S., but according to the Amended Complaint, the brand name "Petrossian" was well known and associated with luxury products around the world. According to Plaintiff, "[a]fter decades of advertising, marketing and product placement, the Petrossian brand had become well known in the Western world as a symbol of exclusivity, luxury and quality, and was identifiable and known to the general public in the same manner as Rolls Royce and Mercedes." (Am. Compl. ¶10).

Plaintiff sought a partner to help it distribute Petrossian Vodka in the U.S. market and selected the Eber Bros. due to its long and well established history as a wholesale distributor of wine and spirits, particularly in the New York Metropolitan area. The parties entered into an Importation and Distribution Agreement ("Distribution Agreement") in August, 2004.

The Distribution Agreement provided that Eber Bros. would exclusively import and use its "best efforts" to distribute Petrossian Vodka in the designated Territory. The Distribution Agreement also set forth desired "volume objectives" in which the agreement provided that the parties desired Eber Bros. to distribute at least 2500 cases of Petrossian Vodka by December 31, 2005.

Significantly, Wolf Concept's Licensing Agreement with Petrossian, Inc. provided Wolf Concept with a temporary license until December 31, 2005 for the purpose of marketing 2500 cases of Petrossian Vodka in the Territory. (Licensing Agreement, Article 3). If 2500 cases could not be sold by Eber Bros. by that date, "[Petrossian, Inc.] and Wolf Concept [had] no further obligation to one another [and the Licensing Agreement] would lapse." (Licensing Agreement, Article 4). Additionally, if 2500 cases could not be sold by December 31, 2005, Wolf Concept was required to terminate the Distribution Agreement with Eber Bros. and buy back the remaining cases from Eber Bros. pursuant to Article 16 of the Distribution Agreement. (Id.).

Eber Bros. did not sell 2500 cases of Petrossian Vodka by December 31, 2005 because the vodka was allegedly not well received in the Territory. Therefore, Wolf Concept's temporary license agreement with Petrossian, Inc. expired and the Distribution Agreement with Eber Bros. was terminated.

Plaintiff commenced the instant action on October 6, 2006, and in its Amended Complaint alleges the following Causes of Action: In the First and Second Causes of Action, Wolf Concept alleges that the Eber Defendants engaged in an unlawful conspiracy to monopolize and restrain trade in violation of the Donnelly Act. In the Third Cause of Action, Plaintiff alleges that Eber-NDC engaged in actions causing tortious interference with a contract - i.e., the Distribution Agreement. In the Fourth Cause of Action, Plaintiff alleges a claim for fraud against The Ebers and Eber Bros. Finally, in the Fifth Cause of Action, Wolf Concept alleges that Eber Bros. breached the Distribution Agreement.

DISCUSSION

I. Standard of Review of Rule 12(c) Motion

A motion for judgment on the pleadings pursuant to Rule 12(c) of the Federal Rules of Civil Procedure is evaluated under the same standards that apply to a Rule 12(b)(6) motion to dismiss for failure to state a claim. Patel v. Contemporary Classics of Beverly Hills, 259 F.3d 123, 126 (2d Cir. 2001); Caudle v. Towers, Perrin, Forster & Crosby, Inc., 580 F.Supp.2d 273, 277 (S.D.N.Y. 2008). Accordingly, when evaluating a Rule 12(b)(6) or Rule 12(c) motion, the court must "accept . . . all factual allegations in the complaint [as true] and draw . . . all reasonable inferences in the plaintiff's favor." See Ruotolo v. City of New York, 514 F.3d 184, 188 (2d Cir. 2008) (internal quotation marks omitted).

When a defendant tests the sufficiency of a complaint by motion, "[t]o survive dismissal, the plaintiff must provide the grounds upon which his claim rests through factual allegations sufficient 'to raise a right to relief above the speculative level.' " ATSI Commc'ns, Inc. v. Shaar Fund. Ltd., 493 F.3d 87, 98 (2d Cir. 2007)(quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). In order to withstand dismissal, therefore, a "complaint must contain sufficient factual matter, [], to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009) (quoting Twombly, 550 U.S. at 570). This "does not require heightened fact pleading of specifics. . . ." In re Elevator Antitrust Litig., 502 ...


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