United States District Court, N.D. Indiana, Fort Wayne Division
MID-AMERICAN SALT, LLC f/k/a MIDWEST SALT OF FORT WAYNE, LLC Plaintiff,
D.J.'S LAWN SERVICE, INC. d/b/a D.J.'S LANDSCAPE MANAGEMENT, Defendant. D.J.'S LAWN SERVICE, INC. d/b/a D.J.'S LANDSCAPE MANAGEMENT, Counterclaim Plaintiff,
MID-AMERICAN SALT, LLC f/k/a MIDWEST SALT OF FORT WAYNE, LLC Counterclaim Defendant
OPINION AND ORDER
William C. Lee United States Judge
an agreement for the sale and purchase of rock salt went
awry, Mid-American Salt, LLC f/k/a Midwest Salt of Fort
Wayne, LLC (“MAS”) filed this suit seeking relief
for breach of contract by the Defendant, D.J.'s Lawn
Service, Inc. (“DLS”). DLS counterclaimed. Before
the Court are MAS's Motion for Partial Summary Judgment
[DE 54] as well as DLS's Cross-motion for Summary
Judgment. [DE 57]. For the following reasons, MAS's
Motion will be DENIED and DLS's Motion will be GRANTED in
part and DENIED in part.
judgment is appropriate “if the movant shows that there
is no genuine dispute as to any material fact and the movant
is entitled to judgment as a matter of law.”
Fed.R.Civ.P. 56(a). The movant bears the initial
responsibility of informing the district court of the basis
of its motion, and identifying those portions of designated
evidence that demonstrate the absence of a genuine issue of
material fact. See Celotex Corp. v. Catrett, 17');">477 U.S. 317,
323 (1986). After “a properly supported motion for
summary judgment is made, the adverse party must set forth
specific facts showing that there is a genuine issue for
trial.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
250 (1986) (quotation marks and citation omitted).
existence of cross-motions for summary judgment does not
imply that there are no genuine issues of material fact. R.J.
Corman Derailment Servs., LLC v. Int'l Union of Operating
Engineers, Local Union 150, AFL-CIO, 335 F.3d 643, 647 (7th
Cir. 2003). “Parties have different burdens of proof
with respect to particular facts; different legal theories
will have an effect on which facts are material; and the
process of taking the facts in the light most favorable to
the non-movant, first for one side and then for the other,
may highlight the point that neither side has enough to
prevail without a trial.” Id.
factual issue is material only if resolving the factual issue
might change the outcome of the case under the governing law.
See Clifton v. Schafer, 969 F.2d 278, 281 (7th Cir.
1992). A factual issue is genuine only if there is sufficient
evidence for a reasonable jury to return a verdict in favor
of the non-moving party on the evidence presented. See
Anderson, 477 U.S. at 248. In deciding a motion for summary
judgment, the court “may not ‘assess the
credibility of witnesses, choose between competing reasonable
inferences, or balance the relative weight of conflicting
evidence.' ” Bassett v. I.C. Sys., Inc.,
15 F.Supp.2d 803');">715 F.Supp.2d 803, 808 (N.D. Ill. 2010) (quoting Stokes
v. Bd. of Educ. of the City of Chi., 17');">599 F.3d 617, 619
(7th Cir. 2010)). Instead, it must view all the evidence in
the record in the light most favorable to the non-moving
party and resolve all factual disputes in favor of the
non-moving party. See Anderson, 477 U.S. at 255. Mindful of
these staNCArds, the Court turns now to the facts of the
most part, the parties agree on the underlying facts in this
case. Where the parties dispute relevant facts, those will be
specifically referenced herein.
a Michigan for-profit regional lawn and landscape business
that offers comprehensive, year-round landscape services to
its clients, including snow and ice management. D.J.
VanderSlik (“VanderSlik”) is the president and
sole shareholder of DLS. (Affidavit of DJ VanderSlik, at
¶2; hereafter “VanderSlik Aff. at
¶__”). From time to time, DLS purchases rock salt
used to prevent snow and ice from accumulating on roads and
parking lots and resells the salt to its customers.
(Id. at ¶s 4-5)
a domestic procurer and reseller of bulk rock salt and other
deicing products. As a procurer of bulk rock salt, MAS
purchases salt from one party and then resells it to its
customers at a higher price. (Complaint, ¶s 3, 4, 9). It
operates, therefore, as a middle man. Andrew Thiele
(“Thiele”) is the president of MAS.
2014, MAS purchased salt for resale from various suppliers,
including Chemical Equipment Labs, Inc. (“CEL”).
(Deposition of Andrew Thiele [DE 58-2], at p. 50; hereafter
“Thiele Dep. at __.”). In August, 2014, Thiele
and VanderSlik began a series of discussions relating to the
sale of bulk rock salt from MAS to DLS. (VanderSlik Aff. at
¶8). However, before VanderSlik was willing to finalize
an agreement, he requested an opportunity to inspect the
inventory of MAS's supplier. (Id. at ¶9).
At that time, Thiele had not disclosed to VanderSlik that CEL
was its supplier.
August 28, 2014, Thiele and VanderSlik met in Michigan to
board a plane to Philadelphia to inspect a salt stockpile in
Wilmington, Delaware. While en route, VanderSlik and Thiele
discussed the terms of a potential sale of the bulk rock
salt. During their meeting, Thiele presented VanderSlik with
a document titled “Mutual Non-Disclosure Non Circumvent
Agreement, ” (the “NCA”). (DE 58-4, Exh.
D). The NCA was designed to protect MAS from potential
customers bypassing MAS to purchase salt directly from
MAS's supplier. Paragraph 3 of the Agreement provided as
follows: “All Confidential Information exchanged
between the Parties pursuant to this Agreement: (a) shall not
be used to circumvent [MAS] and do business directly with the
supplier…” (Id. at ¶3a). Paragraph
4 provides an exception to the restrictions in Paragraph 3:
“The obligations of paragraph 3 shall not apply,
however, to any information which: (a) is already in the
public domain or becomes available to the public through no
breach of this Agreement by the receiving party
…” (Id. at ¶4a).
9 of the NCA states:
[MAS] shall provide the name and address of its confidential
supplier of Bulk Rock Salt for the purpose of inspecting the
quality of the salt. The Customer is bound by this agreement
and agrees not to circumvent [MAS] and attempt to purchase
salt directly from the named supplier. If the customer
circumvents [MAS] and purchases directly from the
confidential source, the Customer agrees to compensate [MAS]
for the sales commission and fees that would have applied if
the salt had been purchased through [MAS].
(Id. at ¶9). There is no temporal or geographic
limitation in the NCA. However, in his deposition, Thiele
testified that his “understanding” of the
duration was that it “specifically was for that
season.” (Thiele Dep. at 214).
testified that he understood that unless and until he signed
the NCA, Thiele would not identify MAS's supplier to DLS.
(Deposition of VanderSlik, at p. 65, hereafter
“VanderSlik Dep. at __.”)
Thiele and VanderSlik arrived in Philadelphia, they were met
by John Morgan, a principal at CEL, who accompanied the men
to CEL's Wilmington, Delaware salt storage facility.
(VanderSlik Dep. at 68). Also present in Wilmington was Ed
Morgan, who was also a principal at CEL and John's
brother. (Id.) VanderSlik had not personally met the
Morgans prior to this interaction; however, VanderSlik
testified that he was aware of the Morgans and CEL prior to
that day as they were well known in the industry and attended
industry trade shows. (VanderSlik Dep. at 54-55: “I was
aware of them prior to my meeting with them. They're
known in the industry and go to snow and ice shows.”).
Thiele, VanderSlik and the Morgans spent approximately three
hours on-site inspecting rock salt before Thiele and
VanderSlik returned to Michigan.
their return, Thiele presented VanderSlik with a second
document titled “Bulk Rock Salt Sales Agreement,
” (“the BRSSA”). (VanderSlik Dep. at 72; DE
58-5, Exhibit E). Prior to VanderSlik signing the agreement,
the two discussed timing, payment, logistics, and additional
sales. (VanderSlik Dep. at 73). At the conclusion of the
meeting, VanderSlik signed the BRSSA. Pursuant to the terms
of the BRSSA, MAS was to sell 27, 500 tons of bulk rock salt
to DLS in exchange for $2, 585, 000. (DE 58-5). The salt was
to be delivered by MAS to Verplank Dock in Muskegon,
payment terms under the BRSSA were as follows:
The total agreed price is $2, 585, 000.00 (27, 500 TONS x
$94.00/US TON) with a down payment of $1, 551, 000.00 via
wire transfer due by 3PM EST on 9/3/2014. The remaining$1,
034, 000 (40%) will be due via wire transfer upon the vessel
arriving at Verplank Dock. The vessel will not discharge
until final payment is received. Delay in final payment will
result in demurrage to the [DLS].
(DE 58-5 ¶2). The parties further agreed to work
cooperatively as the agreement confirms “the Spirit of
Mutual Cooperation and Good Faith.” (Id. at
to the initial payment due date, DLS discovered that it was
having trouble obtaining financing for the transaction, as
the transaction was unusually large for DLS. (Supplemental
Affidavit of VanderSlik [DE 65-1], at ¶10, hereafter
“VanderSlik Supp. Aff. At ”). In particular,
DLS's lender was concerned that the initial payment was
being made directly to MAS, rather than in escrow, and that
the remaining $1.5 million would also be sent directly to MAS
without any guarantee of performance by MAS. (VanderSlik
Supp. Aff. ¶10-11).
of these lending concerns, on September 2, 2014, VanderSlik
contacted Thiele and requested additional time to make the
initial payment. Thiele, in turn, granted DLS until September
5, 2014 to make its initial payment. (VanderSlik Aff. at
¶13). VanderSlik continued its efforts to secure
financing through its attorney, Nathan VanRyn, but was
ultlimately unable to obtain the financing prior to the
expiration of the new September 5 deadline. (Id.)
this same time, Thiele and MAS's vice president,
Thiele's brother, were out of the country. As a result,
MAS's Sales Manager, Josh Hunter (“Hunter”)
was in contact with VanderSlik and VanRyn. DLS contacted
Hunter and sought an additional extension, which Hunter
granted through September 8, 2014. (VanderSlik Supp. Aff. at
¶18). In his deposition, Thiele testified that
Hunter's extension of the initial payment deadline was
valid and that DLS could rely on his representation. (Thiele
Dep. at 105).
Hunter's agreement to extend the deadline through
September 8, on September 6 Thiele sent the following email
sent to VanderSlik:
Hi Dj. I understand that your attorney has been trying to get
a hold of me. I gave you the wire info last week. The money
was first to be wired by Wednesday and I agreed to wait until
Friday. I have gone above and beyond to accommodate you even
though we agreed to something totally different. It was very
clear after we signed the deal at your office as to how
transactions were to proceed. The money was supposed to be
wired by Friday and I was to [sic] wire the money into
escrow. This has not happened. Because you have not complied
with the terms and conditions of our agreement, it is no
longer valid. We will have to negotiate a new agreement. Also
based on the non circumvent agreement, please do not have any
direct contact with [CEL].
their respective attorneys, MAS and DLS communicated and,
ultimately, on September 17, 2014, DLS's counsel emailed
MAS's counsel as follows:
Thank you for your work on this. Having reviewed, it looks
like the terms of this final agreement are worse for
D.J.'s Landscape than the previous agreement you sent
yesterday. In other ...