Aerel, S.R.L. v. PCC Airfoils, L.L.C.

371 F. Supp. 2d 933, 2005 U.S. Dist. LEXIS 13886, 2005 WL 1287435
CourtDistrict Court, N.D. Ohio
DecidedJune 1, 2005
Docket1:04CV0744
StatusPublished
Cited by4 cases

This text of 371 F. Supp. 2d 933 (Aerel, S.R.L. v. PCC Airfoils, L.L.C.) is published on Counsel Stack Legal Research, covering District Court, N.D. Ohio primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Aerel, S.R.L. v. PCC Airfoils, L.L.C., 371 F. Supp. 2d 933, 2005 U.S. Dist. LEXIS 13886, 2005 WL 1287435 (N.D. Ohio 2005).

Opinion

Memorandum of Opinion & Order

GAUGHAN, District Judge.

Introduction

This matter is before the Court upon the following motions: (1) defendant PCC Airfoils, L.L.C.’s Motion for Summary Judgment (Doc. 28); (2) plaintiff Aerel, S.R.L.’s Cross-Motion for Partial Summary Judgment (Doc. 32); and (3) defendant PCC Airfoils, L.L.C.’s Motion to Strike Aerel’s Improper Sur-Reply (Doc. 35). This is a breach of contract action arising out of the parties’ sales representative agreement. The issue presently before the Court is whether the plaintiff is entitled to commissions relating to sales which it procured during the contract term but which were not delivered and/or paid for until after the termination of the parties’ contractual relationship. For the following reasons, the Court (1) grants defendant PCC Airfoils, L.L.C.’s Motion for Summary Judgment; (2) denies plaintiff Aerel, S.R.L.’s Cross-Motion for Partial Summary Judgment; and (3) denies defendant PCC Airfoils, L.L.C.’s Motion to Strike.

Facts

Defendant PCC Airfoils, L.L.C. (hereinafter “PCC”) is a limited liability company existing under the laws of the State of Ohio. 1 (Complt. at ¶ 2). It casts intricate *935 geometric blades, vanes and vane segments for the high-temperature turbine section of jet engines and power generation equipment. Plaintiff Aerel, S.R.L. (“Aerel”) has been engaged as a sales agent for PCC, as described below.

The parties entered into their first written Sales Representation Agreement in July 1987 (hereinafter “1987 Agreement”). According to this Agreement, Aerel was paid on a commission basis. With regard to commission payments, and as relevant to the claims herein, the 1987 Agreement provides as follows:

5-C Upon termination of this AGREEMENT, PCC Airfoils, Inc. [sic] obligation to pay commission on sales of PRODUCT promoted by AEREL hereunder shall cease except AEREL shall be paid commission on purchase orders then in force for castings to be delivered up to 18 months after the termination of the contract where the PRODUCTS covered thereby have not been delivered or paid for. No commission shall be paid to Aerel unless payment in full has been received by PCC Airfoils, Inc. in United States Dollars.

See 1987 Agreement (attached as Exh. A to defendants’ Motion for Summary Judgment) (emphasis added). The 1987 Agreement was in effect from July 1987 until December 31,1989.

In January 1990, the parties extended the Sales Representation Agreement (with certain modifications not relevant herein) through December 31, 1992 (hereinafter “1990 Agreement”). The parties extended their contractual relationship again via Agreements dated February 17, 1993 (hereinafter “1993 Agreement”) and December 5, 1995 (hereinafter “1995 Agreement”). After the expiration of the 1995 Agreement, Aerel continued to act as a sales agent for PCC but the parties operated without a written contract. This arrangement continued from January 1999 through July 2000.

The 1990, 1993 and 1995 Agreements each contain the same provision as set forth in 1987 Agreement (and reproduced above) regarding payment of commissions for up to 18 months after the termination of the contract (hereinafter “the 18-month provision”). In addition, PCC states that it continued to pay Aerel commissions consistent with the 18-month provision during the time period when the parties operated without a written contract.

In July 2000, the parties entered into a new Sales Representation Agreement (the “2000 Agreement”). This Agreement was in effect-from July 2000 until December 31, 2002. The 2000 Agreement changed the provision contained in the prior Agreements regarding the payment of commissions after termination of the contract as follows:

5-B Upon termination of the Agreement, PCC AIRFOILS, INC. [sic] obligation to pay commission on sales of Products promoted by AEREL hereunder shall cease.

See 2000 Agreement (attached as Exh. H to defendant’s Motion for Summary Judgment).

Aerel’s principal, Luciano Cosentini, testified in deposition that he was aware of the change to the contract, and that he was unhappy that the 18-month provision was not included in the 2000 Agreement. (Cosentini Depo. at 35, 40). However, in an Affidavit submitted with Aerel’s Brief in Opposition to defendant’s Motion for Summary Judgment and Cross-Motion for Partial Summary Judgment, Mr. Cosentini explains that the above Paragraph 5-B was included as part of negotiations regarding a commission “tail.” Specifically, Mr. Cosentini avers that:

3. During the negotiation of the 2000 written contract, I requested a com *936 mission “tail,” a provision in the contract that would have allowed Aerel to collect commissions on PCC’s sales to Italian customers that were negotiated and procured by PCC staff, and not by Aerel, after the contract expired.
4. I suggested that Aerel was entitled to this “tail” in recognition of the fact that Aerel developed and [sic] grown the Italian market for PCC’s products.
5. During negotiations, PCC rejected my proposal, and instead agreed to the language in the written contract.

See Cosentini Aff. at ¶¶ 3-5. Mr. Cosenti-ni further states that, regardless of these negotiations, he understood that Aerel would be entitled to commissions for sales that originated in Italy during the contract term, but were not delivered to Italy until after the contract term. Id. at ¶ 6. He further avers that PCC’s Sales Director, Alan Peterson, confirmed this understanding during and after negotiation and execution of the written contract. Id. at ¶ 7. Apparently in reliance on this understanding, Aerel proceeded to negotiate long-term blanket purchase orders with at least two major Italian clients, FiatAvio and Nuovo Pignone. Id. at ¶ 8.

After the 2000 Agreement expired on December 31, 2002, PCC decided not to renew Aerel’s contract. Id. at ¶ 12. PCC’s sales under the blanket purchase orders negotiated by Aerel continued, however, and totaled over $30 million in 2003 and over $2 million in 2004. Id. at ¶¶ 13, 15. Aerel claims that it is entitled to its commissions on these sales as well as all such sales that occur in 2005. PCC disagrees, arguing that the 2000 Agreement specifically provides that PCC’s obligation to pay commissions terminated once the Agreement expired.

Aerel filed suit in this Court on April 21, 2004. The Complaint alleges three counts. Count One alleges breach of contract. Count Two alleges quasi-contract. Count Three alleges unjust enrichment.

PCC filed its Motion for Summary Judgment on March 15, 2005. Aerel thereafter filed its Brief in Opposition to defendant’s Motion for Summary Judgment and Cross-Motion for Summary Judgment on April 14, 2005. It is these Motions that are currently before the Court.

Standard of Review

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Bluebook (online)
371 F. Supp. 2d 933, 2005 U.S. Dist. LEXIS 13886, 2005 WL 1287435, Counsel Stack Legal Research, https://law.counselstack.com/opinion/aerel-srl-v-pcc-airfoils-llc-ohnd-2005.