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BP W. Coast Products LLC v. SKR Inc.

United States District Court, W.D. Washington

October 22, 2013

BP WEST COAST PRODUCTS LLC, Plaintiff,
v.
SKR INC, et al., Defendants

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For BP West Coast Products LLC, a Delaware limited liability company, Plaintiff, ThirdParty Defendant, Counter Defendant: Daniel J. Oates, Douglas Clayton Berry, GRAHAM & DUNN (SEA), SEATTLE, WA; Kent Michael Fandel, GRAHAM & DUNN PC, SEATTLE, WA.

For SKR Inc, an Oregon corporation, Sherif K. Riad, individually and the marital community composed of Sherif K. Riad, Defendants: Adam T Birnbaum, LEAD ATTORNEY, THE BIRNBAUM LAW OFFICES, PUYALLUP, WA; David A. Schiller, PRO HAC VICE, SCHILLER EXLINE, PLLC, PLANO, TX.

For SKR Inc, an Oregon corporation, ThirdParty Plaintiff, Counter Claimant: Adam T Birnbaum, LEAD ATTORNEY, THE BIRNBAUM LAW OFFICES, PUYALLUP, WA; David A. Schiller, SCHILLER EXLINE, PLLC, PLANO, TX.

For Sherif K. Riad, individually and the marital community composed of Sherif K. Riad, ThirdParty Plaintiff: Adam T Birnbaum, THE BIRNBAUM LAW OFFICES, PUYALLUP, WA; David A. Schiller, SCHILLER EXLINE, PLLC, PLANO, TX.

Sherif K. Riad, individually and the marital community composed of Sherif K. Riad, Counter Claimant, Pro se, West Linn, OR.

For Sherif K. Riad, individually and the marital community composed of Sherif K. Riad, Counter Claimant: Adam T Birnbaum, THE BIRNBAUM LAW OFFICES, PUYALLUP, WA; David A. Schiller, SCHILLER EXLINE, PLLC, PLANO, TX.

OPINION

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ORDER GRANTING SUMMARY JUDGMENT TO BPWCP ON COUNTERCLAIMS, DENYING MOTION TO VOLUNTARILY DISMISS COUNTERCLAIMS, AND DENYING MOTION TO AMEND MOTION TO VOLUNTARILY DISMISS COUNTERCLAIMS

Marsha J. Pechman, Chief United States District Judge.

This matter initially came before the Court on Plaintiff's motion for summary judgment on Defendants' counterclaims. (Dkt. No. 92.) The Court considered the motion, Defendants' response (Dkt. No. 102), and Plaintiff's reply (Dkt. No. 103). After this motion was fully briefed, individual Defendants submitted on their own behalf and on behalf of the corporation SKR, Inc. a motion to voluntarily dismiss Defendants' counterclaims without prejudice. (Dkt. No. 106.) Plaintiff opposed this motion. (Dkt. No. 109.) One of the grounds on which Plaintiff opposed the motion was that it was improperly submitted as a pro se filing on behalf of a corporation and while Defendants are represented by a licensed attorney. (Id. at 2-3.) Plaintiff's opposition was filed on September 11, 2013. Nearly one month later, on October 10, 2013, Defendants' local counsel filed a motion to amend the motion to voluntarily dismiss counterclaims, only to the extent the Court would consider it filed by the attorney of record in this case. (Dkt. No. 122.)

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Upon consideration of all the motions, responsive pleadings and relevant information before the Court, the Court DENIES the motion to voluntarily dismiss and the motion to amend the motion to voluntarily dismiss, and GRANTS the motion for summary judgment on Defendants' counterclaims. The motion for summary judgment incorporates the facts and background section from Plaintiff's simultaneously filed motion for summary judgment on Plaintiff's claims (Dkt. No. 91), and background from that motion and its supporting attachments is referenced below.

Background

Plaintiff BP West Coast Products (" BPWCP" ) filed suit against Defendants SKR, Inc., Sherif K. Riad and his wife Nagwa Riad (collectively " SKR" ), for violating certain franchising agreements, deed restrictions and trademark rights. SKR operates two gasoline stations--one in Vancouver, Washington, and one in Beaverton, Oregon. As alleged, SKR refuses to sell ARCO branded gasoline and am/pm products, which BPWCP alleges is a breach of the franchising agreements SKR entered into, and certain deed restrictions and real estate agreements.

BPWCP markets and distributes ARCO-branded gasoline. (Dkt. No. 1 at 3.) ARCO gasoline is sold to the public through a network of independent dealers licensed to use the ARCO Marks and trade dress pursuant to agreements defined as franchises under the Petroleum Marketing Practices Act. (Id.) BPWCP is also franchisor of convenience stores under the am/pm service mark (" ampm" ). (Id.) The Riads, through their wholly owned corporation, Defendant SKR, Inc., purchased from BPWCP a gasoline dealership and ampm convenience store business in 2008 (" Beaverton Station" ) and 2001 (" Vancouver Station" ). (Dkt. No. 1 at 4.)

Defendants entered into an ARCO Gasoline Dealer Agreement (" GDA" ) and an ampm Mini Market Agreement related to the Beaverton Station effective October 1, 2008 (collectively, " Beaverton Site Agreements" ). (Dkt. No. 47 at 9.) The GDA included both the sublease for the Beaverton Property and a Motor Fuel Supply Agreement. (Dkt. No. 91 at 2.) Both agreements had a term of three years with optional rights of renewal (Id.) After profitably operating the Beaverton Station for over six years, Defendants began looking to purchase another ARCO gas station in 2006. (Id.)

Mr. Riad attended a How-to-Bid seminar in 2006 conducted by BPWCP's broker, NRC Realty, but was unsuccessful in placing any bids. (Dkt. No. 91 at 3.) Ms. Riad attended another How-to-Bid seminar in April 2007. Ms. Riad contends she approached then-regional sales manager Marty Cuneo to inquire about profit margins SKR could expect on gasoline and store sales. (Dkt. No. 93-1 at 38.) She claims he disclosed she could estimate future profitability by using a margin of 9 cents per gallon and a 30-32% margin on in-store sales. (Id. at 81-83.) According to NRC's attendance records and Mr. Cuneo himself, Mr. Cuneo was not at the April 2007 How-to-Bid seminar. (Dkt. No. 100-1 at 2, Dkt. No. 95 at 2.)

After the seminar, Defendants requested and received Property Specific Packages (" PSPs" ) on a few properties, outlining store-specific information including recent annual in-store sales figures, and gallons of gasoline sold. (Dkt. No. 91 at 3.) The PSPs did not contain information on profitability of any stations, and contained an express disclaimer stating, " The sales information stated above is the actual operating results for this unit. It does not constitute a suggestion, representation or warranty of future sales. A

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new franchisee's or operator's individual financial results are likely to differ." ...


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