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R3 Composites Corp. v. G&S Sales Corp.

United States District Court, N.D. Indiana, Fort Wayne Division

June 5, 2019

R3 COMPOSITES CORPORATION, Plaintiff/Counter-Defendant,
v.
G&S SALES CORP., Defendant/Counter-Plaintiff.

          OPINION AND ORDER

          HOLLY A. BRADY UNITED STATES DISTRICT JUDGE

         This litigation centers around whether R3 Composites Corporation breached an agreement to pay commissions to Defendant G&S Sales Corporation for business that G&S procured on behalf of R3. The Court previously ruled on Plaintiff R3's Motion for Summary Judgment in connection with R3's declaratory judgment action. The Court held that the agreement at issue was illusory and lacked sufficient definiteness to be enforced. Additionally, because the parties neither demonstrated the existence of an implied or oral contract nor provided the specific terms of an implied or oral contract, the Court did not grant summary judgment on whether such an implied or oral contract existed nor whether such an implied or oral contract was breached.

         BACKGROUND

         A. The Pleadings

         The pleadings in this litigation center around a Non-Disclosure Agreement (“NDA” or “Agreement”), signed by the parties on February 10, 2011. R3 filed the present lawsuit on October 21, 2016 [ECF No. 5]. In Count I of its Complaint for Declaratory Judgment, R3 sought a judgment declaring that the NDA is valid and enforceable, that R3 has paid G&S all commissions required under the NDA, and that R3 is not obligated to pay G&S any future commissions. In Count II, R3 sought a judgment declaring, in the alternative, that, if the Court found that the NDA was unenforceable and an implied contract existed, R3 had paid G&S all commissions to which G&S was entitled under the implied contract and that R3 was not obligated to pay G&S any future commissions under the implied contract. The Complaint was originally filed in Allen Circuit Court.

         On November 14, 2016, G&S removed the action to federal court and filed its Answer [ECF No. 2] and Counterclaims [ECF No. 3]. One of the affirmative defenses G&S asserted was that the Complaint was “barred in whole or part because a contact [sic] may not be implied where the subject matter in question is addressed by an express contract.” (Aff. Def. ¶ 3.) G&S's Counterclaims were for breach of contract and violation of the Indiana Sales Commission Act. On December 22, 2016, G&S filed Amended Counterclaims [ECF No. 10] adding a third count requesting a declaratory judgment that R3 is obligated to pay future sales commissions to G&S in accordance with the NDA. On March 21, 2019, G&S sought leave to file a Second Amended Counter-Complaint [ECF No. 57] to assert an alternative theory of recovery based upon an implied and/or oral contract.

         B. Summary Judgment

         On August 24, 2018, R3 moved for summary judgment on grounds that the NDA did not require it to pay commissions after September 9, 2016 (the last date G&S obtained an order), and, therefore, it did not breach the NDA. R3 argued, in the alternative, that the NDA is an illusory agreement because it lacks sufficient definiteness to be enforced. Accordingly, G&S could not prevail on its breach of contract claim. R3 also moved for summary judgment on G&S's counterclaim under the Indiana Sales Commission Act.

         Although the parties devoted much of their briefing to their respective interpretations of the NDA and whether R3 breached the NDA, the Court first addressed whether the NDA is illusory and unenforceable. The Court concluded that the NDA is an illusory, unenforceable contract as its language evidences that the parties did not intend to be bound on the important issue of commission payments. The Court granted summary judgment in favor of R3 on the issue that the NDA is an unenforceable contract. The Court denied summary judgment on all other issues and claims.

         C. G&S Motion to Reconsider and R3 Motion to Amend Opinion and Order

         On March 21, 2019, G&S filed a Motion for Partial Reconsideration of Opinion and Order Granting in Part and Denying in Part Plaintiff's Motion for Summary Judgment [ECF No. 55]. G&S requests that the Court reconsider its finding that the NDA is an illusory, unenforceable contract. G&S argues that the Court made an error of apprehension regarding Indiana contract law when it did not acknowledge the principal that contracts need not be in a single self-contained document. R3 opposes the motion and asks that the Court modify its Order to enter final judgment in R3's favor on R3's Complaint for Declaratory Judgment and on G&S's First Amended Counter-Complaint. In the alternative, G&S asks that the Court enter partial summary judgment in its favor on any claims for commission after September 9, 2016. To that end, G& S filed its own Motion to Modify or Amend February 27, 2019 Opinion and Order [ECF No. 60].

         ANALYSIS

         A. ...


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