Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Gregg v. Y. A. Co. Co.

December 28, 2007

RACHEL GREGG D/B/A PREFERRED CLEANERS, PLAINTIFF,
v.
Y. A. CO. CO., LTD, D/B/A FUJISTAR SHIRT SYSTEM, AND ROBERT E. NABORS, DEFENDANTS.



The opinion of the court was delivered by: Susan K. Lee United States Magistrate Judge

Lee

MEMORANDUM and ORDER

I. Introduction

Before the Court are: (1) the motion of defendant Robert E. Nabors ("Nabors") for summary judgment pursuant to Fed. R. Civ. P. 56 [Doc. No. 39]; (2) the second motion of defendant 19172 Corporation d/b/a/ Fujistar Shirt System ("Fujistar") for summary judgment pursuant to Fed. R. Civ. P. 56 [Doc. No. 41]; (3) the motion of plaintiff Rachel Gregg d/b/a Preferred Cleaners ("Plaintiff") for summary judgment on Nabors' counterclaim under Fed. R. Civ. P. 56 [Doc. No. 56]; and (4) Nabors' motion to substitute exhibit [Doc. No. 61]. Several pleadings have been filed in support of and in opposition to the pending motions for summary judgment [Doc. Nos. 40, 42, 47, 48, 49, 50, 57 & 60], all of which have been carefully reviewed and fully considered.

For the reasons set forth below: (1) Fujistar's second motion for summary judgment [Doc. No. 41] will be GRANTED and Plaintiff's remaining claims against Fujistar will be DISMISSED WITH PREJUDICE; (2) Plaintiff's motion for summary judgment on Nabors' counterclaim [Doc. No. 56] will be DENIED and those claims will proceed to trial; (3) Nabors' motion to substitute exhibit [Doc. No. 61] will be GRANTED; and (4) Nabors' motion for a summary judgment [Doc. No. 39] will be DENIED and those claims will proceed to trial.

II. Background

A. Procedural

Plaintiff filed her original complaint in the Chancery Court of Hamilton County, Tennessee, on August 17, 2006 [Doc. No. 1-2]. Named as defendants in Plaintiff's original complaint were Y.A. Co.Co. Ltd. d/b/a Fujistar Shirt System and Nabors [Doc. No. 1-2 at ¶ 1]. Plaintiff asserted "Nabors is an employee and/or agent of the defendant, Y.A. Co.Co. Ltd., d/b/a Fujistar Shirt System." [Id.]. Plaintiff alleged defendants sold Plaintiff a shirt pressing machine (the "shirt machine") and that the defendants provided warranties and guaranties on the shirt machine [Doc. No. 1-2 at 1]. Plaintiff asserted the shirt machine never worked properly or complied with the guarantees and warranties provided by law under the Tennessee Uniform Commercial Code, Tenn. Code Ann. §§ 47-2-313, et seq. (the "TUCC") [id. at 1-2]. Plaintiff requested an award of compensatory, punitive, and consequential damages, including loss of business profits, interest paid on the loan to purchase the shirt machine, and attorney's fees [id. at 2].

On September 22, 2006, Plaintiff's action was removed from state court to this Court pursuant to 28 U.S.C. § 1441 [Doc. No. 1]. On November 22, 2006, Fujistar filed its first motion for summary judgment [Doc. No. 14]. On March 15, 2007, Plaintiff filed a motion to amend her complaint under Fed. R. Civ. P. 15 to correct the name of Fujistar to 19172 Corporation d/b/a Fujistar Shirt System [Doc. No. 25]. The Court granted the motion to amend and granted in part and denied in part Fujistar's motion for summary judgment [Doc. No. 33]. Specifically, the aspect of Fujistar's motion for summary judgment on Plaintiff's claims that Fujistar breached implied or express warranties under the TUCC as the manufacturer or seller of the shirt machine to Plaintiff was granted and those claims were dismissed with prejudice. The aspect of Fujistar's motion which sought summary judgment on Plaintiff's remaining claims against Fujistar was denied.

B. Factual

Fujistar has submitted excerpts from the deposition of Richard Strickland ("Strickland") [Doc. No. 41-2] and a copy of the instruction manual for the shirt machine [Doc. No. 49-2] in support of its motion for summary judgment. Nabors has submitted excerpts from the Plaintiff's deposition [Doc. No. 39-2], excerpts from the deposition of Strickland [Doc. No. 39-3], excerpts from the deposition of Nabors [Doc. No. 39-4], and excerpts from the deposition of Tony Haddad ("Haddad") [Doc. No. 39-5] in support of his motion for summary judgment. The contract between Fujistar and Widmer Cleaners, the original purchaser of the shirt machine, is also attached to Nabors' motion for summary judgment [Doc. No. 39-5 at 2]. As part of her response to Nabors' and Fujistar's motions for summary judgment, Plaintiff has submitted the affidavit of Strickland [Doc. No. 47-2], her affidavit [Doc. No. 47-3], portions of her deposition [Doc. No. 47-4] and portions of Haddad's deposition [Doc. No. 47-5].

In support of her motion for summary judgement on the counterclaim asserted by Nabors regarding a promissory note, Plaintiff has filed her affidavit [Doc. No. 56-3] and the affidavit of Strickland [Doc. No. 56-2]. Nabors has submitted his affidavit [Doc. No. 61-2] in support of his response in opposition to Plaintiff's motion for summary judgment.

1. The Invoices

The invoice for the sale of the shirt machine from Fujistar to the original purchaser, Widmer Cleaners, states in pertinent part:

LIMITATION OF WARRANTIES. All warranties, if any, relating to the equipment sold pursuant to this contract come directly, and in writing, from the manufacturer of the equipment, and not from seller. No statements made by seller, nor any action or inaction by seller, nor any trade custom or course of dealing with seller, shall create any warranty, expressed or implied on the part of the manufacturer. No statement made by the manufacturer, nor any action or inaction taken by the manufacturer, nor any trade custom or course of dealing with the manufacturer, shall create any warranty, express or implied, on the part of the seller. Buyer acknowledges that upon delivery he inspected the equipment and it was in good order and condition. As to the Seller, buyer acknowledges purchase of the equipment is on an "as is" basis with out warranty of any kind, including, but not limited to, the implied warranties of merchantability and fitness for a particular purpose, and that any warranties come from the manufacturer. [Doc. No. 39-5 at 2].

The invoice for the sale of the shirt machine from Nabors to Plaintiff/Preferred Cleaners, dated September 28, 2005, states the shirt machine was sold to Preferred Cleaners for $57,000.00 [Doc. No. 39-3 at 6]. The single-page invoice lists the component parts of the shirt machine as follows:

Description Model # Serial # Price

Fujistar cuff and FTP555A 117 $15,000.00 collar press Fujistar sleeve press YPS812E 123 $14,7000.00 Fujistar body press FDB002A 2286 $25,300.00 Fujistar collar form FDB921 154 $2,000.00 Total Due $57,000.00

2. The Instruction Manual

The cover of the instruction manual states "Manufacturer: Y. A. C. Co., Ltd. (Japan)" [Doc. No. 49-2]. The manual also sets forth the warranties on the shirt machine as follows:

1.2 Warranties

The warranty system of this system is as shown below;

1) Warranty Period

Parts ------ One (1) year after on-site acceptance Labor ----- One

(1) after on site acceptance

2) Exceptions of warranty

Even in the warranty period, warranty is not applied in the following cases.

a. The damages and failures caused by user's wrong handling or improper operation

b. The damages and failures caused by reasons belonging to the user's facility.

c. The damages and failures caused by natural calamities and any other reasons on which vendor is not liable.

Id. at 7. The manual further states that "[a]ll the copyrights of this document belong to Y.A.C. Co., Ltd. . . ." [Id. at 6].

3. The Promissory Note

A handwritten promissory note for $10,000.00 executed by Strickland on March 15, 2006, states:

For value received, RICHARD STRICKLAND DBA Preferred Cleaners promises to pay, to the order of Robert E. Nabors, 184 Thorncrest Drive, Ringgold, Ga., the principal sum of Ten thousand Dollars ($10,000.00 ) plus $1,000.00, for a total of Eleven Thousand Dollars ($11,000.00 ) on or before April 15, 2006. [Doc. No. 9-2]. Strickland signed the handwritten promissory note on a signature line which reads "Richard Strickland/DBA Preferred Cleaners." [Id.].

4. Strickland

Strickland is Plaintiff's son and the operations manager for Preferred Cleaners [Doc. No. 39-3 at 2-3, Doc. No. 47-2 at 1-3]. Strickland avers he has known Nabors for several years, and, after attending a trade show, he met with Nabors and told him he was interested in both the Fujistar and Sankosha shirt machines [Doc. No. 47-2 at 1-3]. Strickland decided the Fujistar shirt machine was too expensive and "decided that we would probably buy the Sankosha machine." [Id. at 1].

Strickland stated he had seen a Fujistar machine demonstrated at a trade show in June or July of 2005, and was pleased with it [Doc. No. 39-3 at 8, deposition at 19-20]. During the trade show, he spoke with Ron Shubert ("Shubert") at a Fujistar booth about a machine [id.]. Strickland stated that Fujistar had a banner on its booth that said "200 shirts per hour and the world's finest quality." [Id., deposition at 20].

Strickland stated he had seen advertisements about the Fujistar shirt machine before he spoke with Nabors about it [id. at 18, deposition at 68-69]. The advertisements stated the machine would do 200 shirt per hour [id., deposition at 69]. When he asked Nabors about the Fujistar machine, Nabors told him that his impression was it produced "the best shirt I've ever seen." [Id.]. Stickland stated he was more interested in a Fujistar machine based upon Nabors' statement [id.].

Strickland stated he went to Nabors about buying a machine from Fujistar or Sankosha because Nabors was in the business of buying and reselling drycleaning machines [id. at 9-10, deposition at 25-26]. Strickland stated he had a discussion with someone at Fujistar who told him to speak with Nabors [id., deposition at 27]. Strickland stated when he spoke with Nabors, Nabors told him he had purchased three machines from Fujistar "and that he was going to be the local representative." [Id.].

After the trade show, Strickland saw an advertisement in American Drycleaner magazine listing the shirt machine for sale for $45,000.00 [id., deposition at 21]. Strickland believes he saw the advertisement for the shirt machine in either July or August 2005, but it could possible have been September 2005 [id.]. Strickland stated he called the owner of the shirt machine, Steve Carico ("Carico") at Widmer Cleaners, who told him he had recently sold the machine to Nabors [id. at 8-9. deposition at 21-22, 24].

Strickland did not ask Carico if the machine pressed 200 shirts per hour, nor did he ask Carico if there was a warranty on the machine [id., deposition at 23]. Strickland also stated he did not ask Carico if the shirt machine had damaged any shirts; however, he stated that Carico told him the machine was in fine working order [id.]. Carico said he had used the shirt machine and had not had any major problems with it [id. at 19, deposition at 71-72]. Strickland stated he relied on Carico's representation the shirt machine was in fine working order [id., deposition at 73].

Strickland stated he had not discussed purchasing the shirt machine with Nabors prior to his conversation with Carico, although he stated he may have told Nabors he was interested in the machine [id. at 9, deposition at 24]. Strickland testified:

At this time, Fujistar had started advertising a lot. We saw the faster, finest quality issues. Mr. Nabors had informed me that he was thinking of becoming a distributor for Fujistar, and that he had been out to California to look at it, and that the quality of shirt that the Fujistar produced was better than what I was getting off the Sankosha, so I started to investigate it further. [Id., deposition at 25].

Strickland stated that after Carico told him Nabors had purchased the shirt machine he called Nabors because he already knew him [id., deposition at 29]. Nabors told Strickland the machine was six months old [id.]. Strickland stated Nabors told him Fujistar would provide a new warranty on the machine [id.]. When asked what Nabors meant by a "new" warranty, Strickland stated:

That the machine was essentially a brand new machine and so, therefore, it would be covered under any warranty by Fujistar.

[Id.]. Strickland stated he "got the impression" from Nabors the warranty would start from the date he purchased the machine and would be a one-year warranty [id. at 11, deposition at 30]. However, Strickland also acknowledged he knew the shirt machine was not a brand new machine because he was aware it was at least six months old and had been sold to Widmer Cleaners and then to Nabors [id.]. Strickland also stated Nabors said "the warranty would be covered by Fujistar," but that Nabors did not say that it would be a new warranty, nor did he say it would start the day the shirt machine was purchased from Nabors [id., deposition at 31]. Strickland also admitted that at the time of his conversation with Nabors he did not know the warranty was a one-year warranty [id.]. Strickland stated that after he purchased the shirt machine he spoke with Fujistar and learned the warranty on a brand new machine was a one-year warranty [id., deposition at 31-32].

Nabors told him the shirt machine would work better than a Sankosha machine or he would give the shirt machine to Strickland [id., deposition at 32]. Strickland stated he did not literally believe Nabors would give him the shirt machine for free, but he thought Nabors statement was a way of "putting it out there that [the shirt machine] is going to do the job." [Id., deposition at 33]. Nabors also told him the shirt machine would not do well on really big shirts [id.].

Strickland stated Nabors also suggested he call Haddad [id. at 12, deposition at 35]. Strickland called Haddad to assure himself there was a new warranty on the machine [id., deposition at 37]. When asked what he meant by a new warranty, Strickland replied, "Just that the machine would be covered by the manufacturer if there were anything defective in it." [Id.]. Strickland stated he was under the assumption the shirt machine would be covered by a one-year warranty starting from the day he "fired the machine up." [Id.].

During their conversation, Haddad told Strickland the machine was covered under warranty, but Haddad did not tell him the length of the warranty [id. at 13, deposition at 38]. Haddad also confirmed the age of the shirt machine [id., deposition at 41]. Haddad did not make any statement about the length of the warranty during their conversation and he did not tell Strickland he had disclaimed any warranties when he sold the shirt machine to Widmer Cleaners [id., deposition at 31]. When asked to specifically describe the warranty that Haddad had allegedly promised to him, Strickland testified:

All that was said was that the machine was covered under the manufacturer's warranty, and I assumed that it would be a full one-year warranty, as I said earlier. [Id. at 16-17, deposition at 61-62].

Strickland stated that when he said he "assumed it would be a full one-year warranty" that "[n]o one ever told me anything to confirm or deny that." [Id. at 17, deposition at 62]. Strickland further testified that when he stated he assumed the warranty would be a full one-year warranty covering parts, but not labor that "it's just industry standard. No one told me that." [Id., deposition at 62]. Strickland testified Haddad and Nabors told him the machine would be covered under the manufacturer's warranty prior to the time he purchased the machine [id., deposition at 62-63].

Nabors told Strickland any warranty would come from Fujistar, the manufacturer [id. at 20, deposition at 76-77]. After being shown the invoice for the purchase of the shirt machine from Nabors, Strickland admitted there was nothing on the invoice that indicated Nabors was acting on behalf of Fujistar or anyone else [id., deposition at 77]. Strickland also admitted he did not receive any written warranty concerning the shirt machine from Nabors [id. at 23, deposition at 86].

Strickland admitted his beliefs about a warranty and the level of production that could be achieved with the shirt machine was ultimately based on his conversation with Haddad [id. at 21, deposition at 78]. When asked what claim he made to Fujistar concerning any warranty on the shirt machine, Strickland stated he made no written claims or requests to Fujistar [id. at 22, deposition at 82]. Strickland stated that "[a]ll that I asked for was that the machine provide me with the quality of product that I had asked for, and whatever it took to do that is what I expected to be done. If that meant replacing parts, that's great. If it meant replacing pads and covers, that's great. I just wanted it to work [id., deposition at 82-83].

Strickland stated he purchased the shirt machine in September 2005 and it was delivered the same month [id. at 15, deposition at 57]. Strickland testified he received a manual from Nabors for the shirt machine at the time he purchased it, but said he found no mention of a warranty in the manual when he looked for it after he experienced problems with the shirt machine [id., deposition at 39].

Strickland stated the purchase price for the shirt machine from Nabors was $57,000.00 [id. at 14, deposition at 49]. Strickland stated Fujistar would have been willing to sell him a new shirt machine for $58,000 plus delivery costs [id. at 20, deposition at 74-75]. Strickland stated Nabors' asking price of $57,000 was consistent with the shirt machine being a new machine [id.].

Strickland did not speak, or did not recall speaking, with anyone at Fujistar except for Haddad prior to the purchase of the shirt machine [id. at 24, deposition at 91]. Strickland did not pay Haddad or anyone else at Fujistar anything in connection with the purchase of the shirt machine [id.]. Strickland did not pay Haddad or anyone at Fujistar for any training in connection with the shirt machine [id.].

Strickland states when the shirt machine was installed, "Haddad came to Chattanooga to show me how to use the machine," but the "machine never operated correctly"[Doc. No. 47-2 at 2].

Strickland avers "[t]he quality of the shirts that came off the Fujistar machine was so bad" the machine has not been used and has been in storage [id. at 3-4]. Strickland further states that, after it was determined the shirt machine would not work, he called Haddad about the warranty and had several conversations with Haddad [id. at 4]. Strickland avers Nabors informed him "Haddad was not going to do anything about the problems." [Id.].

Strickland also avers:

I have done everything that I could think of to get the machine to work properly. . . . [Id.]. Strickland testified he could not get either the quality or quantity of pressed shirts he expected from the shirt machine [Doc. No. 39-3 at 7, deposition at 12]. He stated the shirt machine was never tried at full speed because of quality issues [id.]. Strickland stated the shirt machine was used for three days and then the Plaintiff's previous shirt machine was reinstalled [id., deposition at 13]. Strickland stated the Plaintiff's "old" machine pressed 45 to 50 shirts per hour [id.].

Strickland stated he executed the promissory note, but it involved a separate deal between himself and Nabors [id. at 14, deposition at 49]. With respect ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.