United States District Court, S.D. New York
OPINION & ORDER
KATHERINE B. FORREST, District Judge.
Defendant Clive Christian New York, LLP, defendant Clive Christian, and defendant-counterclaimant Clive Christian Furniture Ltd. (collectively, "defendants") have moved for summary judgment with respect to plaintiff Christians of California, Inc.'s fourth claim for fraud/misrepresentation and sixth claim for civil conspiracy. (ECF No. 233.) Plaintiff has also moved to strike arguments raised by defendants in their reply brief. (ECF No. 250.) For the reasons that follow, plaintiff's motion to strike is DENIED and defendants' motion for summary judgment is GRANTED.
A. Factual Background
Plaintiff Christians of California, Inc. ("COC") is a Colorado corporation with its headquarters in Colorado. (ECF No. 167 ¶ 6.) Defendant Clive Christian ("Mr. Christian") is Chairman of Clive Christian plc, and he owns 49, 999 of its 50, 000 shares. (DSOF ¶¶ 19-20.) Defendant Clive Christian Furniture Ltd. ("CCF") is wholly owned by Clive Christian plc. (DSOF ¶ 21.) CCF manufactures cabinetry and fitted furniture. (DSOF ¶ 1.) Defendant Clive Christian New York, LLP ("CCNY") is a limited liability partnership, which at the time of the events at issue in this case was 99.5% owned by Clive Christian plc and 0.5% owned by Mr. Christian. (DSOF ¶ 22.)
In December 1998, COC and CCF entered into an agreement (the "Dealership Agreement") pursuant to which CCF granted COC the right to open a Clive Christian-brand dealership in the Los Angeles area. (DSOF ¶ 1.) COC alleges that the Dealership Agreement contains a provision granting COC exclusive rights to California. Whether that contract is exclusive or not is irrelevant to the outcome of this motion.
In addition to the parties, the relevant participants in the events at issue include: architect Frank Durgin (PRSOF ¶ 3); Julie Lloyd, a former COC employee who in 2011 was operating as an independent agent selling Clive Christian furniture in San Francisco (PRSOF ¶ 3); Lori McCuaig, the owner of LMC Design Group (DSOF ¶ 2); and Jackie Weeman, the managing director of defendant CCNY (PRSOF ¶¶ 3, 5).
The dispute between the parties relates to the following series of events: In late 2010, McCuaig was working as the agent for the Zaragoza family on a home remodeling project (the "Zaragoza Project"), and she contacted COC's Clive Christian Beverly Hills dealership regarding a potential sale of cabinetry and fitted furniture for that project. (DSOF ¶ 2.) Over the course of the year that followed, McCuaig had discussions with COC regarding this potential sale. (See DSOF ¶ 3.) Architect Frank Durgin was hired by COC to oversee the installation of the Zaragoza Project. (See PRSOF ¶ 3.) Ultimately, on December 20 or 21, 2011, McCuaig decided not to purchase cabinetry and fitted furniture from COC. (PRSOF ¶ 3.) On December 20 or 21, 2011, McCuaig contacted defendant CCNY to discuss a potential sale of cabinetry and fitted furniture for the Zaragoza Project. (DSOF ¶ 4; see PRSOF ¶ 3.) This was the first time she had spoken with CCNY, its managing director Weeman, or any of the defendants. (DSOF ¶¶ 3-4.) Durgin was brought on to work on the Zaragoza project after the sale was transferred to CCNY. (See PRSOF ¶ 3.)
Around the time that McCuaig decided not to purchase cabinetry and fitted furniture from COC, there were various communications among Mr. Christian, Durgin, Lloyd, McCuaig, and Weeman. Around the end of November 2011, Lloyd and McCuaig had a phone conversation during which McCuiag expressed some concerns about the Zaragoza Project, and after which Lloyd may have given her Weeman's phone number. (PRSOF ¶ 3 & nn.21-22, 24.) In late November or early December 2011, Lloyd and Mr. Christian spoke about the Zaragoza Project. (PRSOF ¶ 3 & nn.25-26.) On December 13, 2011, Lloyd and Durgin spoke on the phone, and on December 14, 2011, Weeman sent Lloyd a text message. (PRSOF ¶ 3.) After December 21, 2011, there were also a number of communications among Mr. Christian, McCuaig, Weeman, Lloyd, and Durgin. (See PRSOF ¶ 3.)
B. Procedural Background
COC filed this action seeking recovery for damages for the alleged loss of the Zaragoza Project on February 10, 2012 in the District of Colorado. (ECF No. 1.) On January 11, 2013, the District of Colorado transferred the action to this District, where it was initially assigned to the Honorable Laura Taylor Swain. The case was later reassigned to the undersigned. (ECF No. 136.)
On February 11, 2013, defendants answered and counterclaimed for damages stemming from COC's alleged violations of the Dealership Agreement. (ECF No. 53.) COC filed an amended complaint (the "Second Amended Complaint") on July 18, 2014. (ECF No. 167 ("SAC").)
The Second Amended Complaint asserts eight claims for relief. COC's fourth claim is for fraud/misrepresentation and is premised on defendants' alleged intent to breach the Dealership Agreement from the outset. (SAC ¶¶ 73-78.) The fraud/misrepresentation claim does not allege a breach of duty by CCF, Mr. Christian, or CCNY separate from any duty CCF had under the Dealership Agreement, and it seeks the same damages as COC's second claim, which is for breach of contract. (See SAC ¶¶ 63, 73-78.) COC's sixth claim is for civil conspiracy, and alleges that Mr. Christian, CCF, and CCNY agreed and conspired to tortiously interfere with COC's prospective business relations by marketing CCNY to LMC Design Group and/or the owners of the Zaragoza Project and seeking to enter into a contract with them. (SAC ¶¶ 86-89.)
On August 1, 2014, defendants moved for summary judgment regarding COC's eighth claim, which is for copyright infringement. (ECF No. 175.) That motion was granted on September 15, 2014. (ECF No. 223.)
On September 5, 2014, defendants wrote a letter to the Court indicating that COC agreed to merge its claim for breach of the implied covenant of good faith and fair dealing with its breach of contract claim, and requesting that plaintiff's fraud/misrepresentation and civil conspiracy claims be "dismissed from the action." (ECF No. 197.) COC submitted a letter on September 12, 2014 confirming its agreement to merge its claims for breach of the implied covenant of good faith and fair dealing with its breach of contract claim, but opposing dismissal of the fraud/misrepresentation and civil conspiracy claims. (ECF No. 221.) Defendants moved for summary judgment on these claims on October 6, 2014. ...