Boston Business Forms, Inc. v. Vantage Travel Services, Inc.

7 Mass. L. Rptr. 504
CourtMassachusetts Superior Court
DecidedJuly 14, 1997
DocketNo. 960528H
StatusPublished

This text of 7 Mass. L. Rptr. 504 (Boston Business Forms, Inc. v. Vantage Travel Services, Inc.) is published on Counsel Stack Legal Research, covering Massachusetts Superior Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Boston Business Forms, Inc. v. Vantage Travel Services, Inc., 7 Mass. L. Rptr. 504 (Mass. Ct. App. 1997).

Opinion

van Gestel, J.

Each defendant, Vantage Travel Services, Inc.1 (“Vantage”) and Outlook Label Systems, Inc. (“Outlook”), has moved for summary judgment on all counts against each corporation. The plaintiff, Boston Business Forms, Inc. (“BBF”), opposes both motions. For the following reasons both motions are ALLOWED as to all counts and the complaint is to be dismissed.

BACKGROUND

BBF alleges contractual relationships with both Vantage and Outlook. Whether such relationships ever came into being will be a major factor in resolving the pending motions. No written agreements exist with regard to BBF’s relationship with either defendant. Thus, the Court must first determine whether disputed material facts stand in the way of determining BBF’s relationship with either or both. The facts that follow are not challenged by BBF.

BBF is a newly formed Massachusetts corporation, intent upon doing business as a distributor in the business forms industry. Prior to forming BBF, its two founders, Timothy McCarthy and Timothy Curtin, were social acquaintances of Mary Lou Newman, director of printing and purchasing as well as a production manager, at Vantage.

Vantage is a Massachusetts-based entity whose principal business consists of direct mail, product-induced fund raising. In connection with its business, Vantage purchases a wide variety of business forms and products, including envelopes, cards and labels. Most of these purchases are made directly from manufacturers; the remaining are from distributors, who first purchase the product from manufacturers and then resell it to Vantage for a commission or markup in price.

Outlook is a Wisconsin company that manufactures business labels. Outlook sells its labels both to distributors and end-users. Prior to the incident in issue here, Outlook never had any business relationship with either BBF or Vantage.

Shortly after BBF began operations, Curtin of BBF started contacting Newman at Vantage seeking business for the new venture. He met with very limited success. Vantage placed only a few small purchase orders for business forms with BBF. In addition to the few orders placed by Vantage, BBF submitted price quotations for several other potential business forms orders that did not result in purchases.

In the fall of 1993, Curtin learned from Newman of Vantage’s constant need for large quantities of labels in its direct-mail marketing campaigns. At this time BBF had yet to sell or distribute any label orders of the magnitude required by Vantage. Supposedly, and accepted for purposes of these motions, Newman said to Curtin: “Labels is where the money is. If you want to make some money, this is where you want to go.” When BBF and Vantage were discussing the label business, Newman is said to have shown BBF a chart setting forth the specifications and deadlines of all Vantage’s upcoming label orders, discussed the quality of the work she was looking for, discussed Vantage’s customers’ needs, shared Vantage’s current price list with BBF, and suggested that she would purchase labels from BBF if it could find acceptable product at competitive prices.

BBF thereafter began searching for label manufacturers that would meet Vantage’s needs. In early 1994, BBF submitted price quotations to Vantage in connection with a potential order of business labels. These quotations came from several label manufacturers, including Outlook. Vantage insisted that prior to entering into any agreement to purchase, it first would have to inspect the manufacturer’s facilities. These inspections were routine for Newman in deciding whether to purchase goods for Vantage from a particular company.

BBF made arrangements to visit Outlook in Wisconsin in late March 1994. Newman traveled with Curtin for the visit. At the time of the trip, Vantage had made no decision to purchase labels from either BBF or Outlook. Even if Newman had been satisfied with the Outlook facility, before discussing the placement of any orders she intended to have the manufacturer do a test run of the labels.

When McCarthy of BBF first contacted Outlook, he was aware that Outlook sold its labels through distrib[505]*505utors as well as directly to end-users. During these preliminary discussions, Outlook never represented to anyone on behalf of BBF that BBF would serve as Outlook’s distributor for any labels purchased by Vantage. Similarly, Outlook never told BBF that it would not sell labels directly to Vantage.

Both Outlook and BBF were, at all material times, members of the National Business Forms Association (“NBFA”), Outlook as a “manufacturer” member and BBF as a “distributor” member. Vantage was not a member of NBFA. The organization has published rules for members with regard to their business practices with each other. Basically, those rules are designed to have manufacturers and distributors work together cooperatively for the benefit of the customer and, thereby, the industry as a whole.

Again for purposes of these motions only, the Court accepts BBF’s contentions that Outlook, at the time leading up to and at the visit by Vantage to the Wisconsin facility, acknowledged that BBF was a distributor and that Vantage was BBF’s customer. Indeed, both Outlook and Vantage treated BBF as if it were a distributor at the time of the Wisconsin visit.

Newman was impressed with Outlook’s label manufacturing operations and wanted to do business. Unbeknownst to her, however, Outlook, consistent with its normal practice, had requested a credit report on BBF. The report indicated that the credit agency had not received a sufficient sample of BBF’s payment experience to establish a credit rating for it. This caused concern by Outlook that BBF might not have sufficient operating capital to serve as a distributor for any large label orders. Given that no orders were then pending, Outlook decided to await the results of the visit, and a firm interest by Vantage in purchasing labels from Outlook, before requesting additional financial information from BBF.

Following the visit, and after Vantage had expressed a firm interest in buying labels from Outlook, Outlook made further inquiiy as to BBF’s ability to serve as a distributor in the kind of business contemplated. BBF would have to have the ability to finance the purchase of labels from Outlook, before reselling them to Vantage.'At the time, BBF had less than $5,000 in its bank account. BBF suggests that it also had access to “personal and family monies," presumably from McCarthy and Curtin, that could have been used. In addition, McCarthy proposed to Outlook that BBF would make a 50% pre-payment to secure any deal. It is further contended by BBF that Outlook agreed to proceed on those terms. Again, the Court accepts these facts only for purposes of deciding these motions.

On April 13, 1994, Outlook wrote to Vantage, reporting that its “business relationship with Boston Business Forms ended [that day]” and noting that “financial details could not be worked out and the partnership dissolved.” In the same letter, Outlook expressed interest in working with Vantage directly and asked: “Will you consider us as a vendor for your printing needs?” There is no allegation by BBF that Vantage solicited this letter or was aware of the financial arrangements, or their breakdown, between BBF and Outlook.

At no time did Vantage ever submit an order to BBF for the purchase of Outlook manufactured labels. Nor did Vantage and BBF ever come to terms on the key details of any purchases by Vantage from BBF of Outlook products.

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Bluebook (online)
7 Mass. L. Rptr. 504, Counsel Stack Legal Research, https://law.counselstack.com/opinion/boston-business-forms-inc-v-vantage-travel-services-inc-masssuperct-1997.