Briggs, Inc. v. Martlet Importing

• Court: Court of Appeals for the First Circuit
• Decided: June 14, 1995
• Docket: 95-1017
• Status: Published

Opinion

USCA1 Opinion

                            United States Court of Appeals

                                For the First Circuit

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        No. 95-1017



                                    BRIGGS, INC.,



                                Plaintiff, Appellant,



                                          v.



                             MARTLET IMPORTING CO., INC.,



                                 Defendant, Appellee.


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                     APPEAL FROM THE UNITED STATES DISTRICT COURT



                              FOR THE DISTRICT OF MAINE



                   [Hon. Eugene W. Beaulieu, U.S. Magistrate Judge]
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                                        Before



                                Boudin, Circuit Judge,
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                            Coffin, Senior Circuit Judge,
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                              and Stahl, Circuit Judge.
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                                 ____________________



            Joel A.  Dearborn with  whom Laurie Anne  Miller was on  brief for
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        appellant.

            David R. Cross with whom James  Brennan and John W.  McCarthy were
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        on brief for appellee.


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                                    June 14, 1995

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COFFIN, Senior  Circuit Judge.  This is  a removed diversity
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          action in which  appellant, Briggs, Inc., a  Maine wholesale beer



          distributor, sued  Martlet Importing Co., a  subsidiary of Molson



          Breweries U.S.A., seeking injunctive relief and monetary damages.



          Briggs  claims  that  Martlet  wrongfully  gave  another  company



          exclusive rights to distribute  a new malt beverage, Molson  Ice,



          in  the   "Bangor  Market,"   where  Briggs  had   the  exclusive



          distribution  rights   for  all  other  Molson   products.    The



          magistrate judge  hearing the  case granted summary  judgment for



          Martlet.  We affirm.



               In 1975, Martlet designated Briggs as its distributor in the



          Bangor area for two of its products, Molson Ale and Molson  Beer,



          and later added  a third,  Molson Golden.   There was no  written



          instrument other  than the  designation of area  distributors and



          products which  Molson filed with  the Maine Bureau  of Alcoholic



          Beverages.  The contract between Briggs and Martlet was oral and,



          under existing Maine law, terminable-at-will.



               In  1979,  the  Certificate  of Approval  Holder  and  Maine



          Wholesale Licensee  Agreement Act (the Act), Me.  Rev. Stat. Ann.



          tit.  28-A,     1451-1465, was  enacted.   This legislation  gave



          protection to  local wholesale  distributors from termination  by



          their suppliers ("certificate of approval holders"); not only was



          reasonable notice  required, section  1455, but "good  cause" was



          made a prerequisite,  section 1454.   After passage  of the  Act,



          Martlet  designated Briggs  its  distributor for  four more  malt



          beverage  items, Molson  Light, Molson  Brador, Molson  Exel, and


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Molson  Special   Dry.     Then   in  1993,   Martlet  gave   the



          distributorship  for  a  new  product,  Molson  Ice,  to  another



          distributor serving the same area.



               The magistrate judge conducted  a hearing in connection with



          a requested temporary restraining order, received depositions and



          affidavits, and  finally granted  summary  judgment for  Martlet.



          The court  based its decision on the contract clauses of the U.S.



          Constitution, Art. I,    10, cl. 1, and of  the Maine Declaration



          of  Rights,  Art.  I,     11,  holding  that  to  apply  the  Act



          retroactively to  the earlier oral agreement  between Martlet and



          Briggs would substantially impair Martlet's understanding that it



          could terminate at will.  It also held that no sufficient  public



          purpose would  be served.   Finally,  it held  that there was  no



          breach of good faith and  fair dealing, as alleged in an  amended



          complaint.



               We do not  reach the contract  clauses issue, preferring  to



          dispose  of  this case  on  the  non-constitutional ground  that,



          whether or not  the Act has retroactive  application, Martlet was



          not obligated under it  to assign the distributorship of  its new



          Molson Ice to Briggs.  This is so because that beverage was a new



          and  separate "brand"  within the  meaning of  the Act,  and thus



          properly  was   the  subject   of  an   independent  distribution



          agreement.    Briggs  argues  that  the  Act  bars  Martlet  from



          assigning  Molson  Ice   to  another  distributor  because   this


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constitutes  a  dual  distributorship, in  violation  of  section



          1453.1   This  conclusion follows  from Briggs'  theory that  all



          Molson  products  comprise a  single "brand."    See App.  at 349
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          (Testimony  of  Allison  Briggs,  chairman of  the  board,  that:



          "Molson is  the brand  and Ice  is an  extension of  the Molson's



          brand.").  Because the Act does not permit a  manufacturer to use



          multiple distributors  for a single brand,  Briggs concludes that



          it must serve as distributor for all Molson products.



               In support  of its  conclusion, Briggs  argues that  the Act



          does not define "brand" or "label" and that these terms should be



          given their ordinary  definition.  As it  happens, however, there



          seems  to be no single,  all purpose definition.   Indeed, Briggs



          cites a Dictionary of  Marketing Terms by Peter D. Bennett to the
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          effect that "A brand may identify one item, a family of items, or



          all  items of [a] seller."  While such a multiplicity of possible



          meanings might in other  circumstances preclude summary judgment,



          we are  not  dealing here  with  a word  in  vacuo but  with  its
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               1The magistrate judge found it unnecessary to decide whether

          the original agreement between Briggs and Martlet encompassed all

          Molson products to be distributed in the Bangor market or whether

          separate agreements were made as each new product was introduced.

          Although Briggs'  chairman of the  board testified that  the 1975

          agreement  obligated   Martlet   to  designate   Briggs  as   its

          distributor for all  new Molson products, Briggs' brief on appeal

          does not contain  this contention.   We note,  in addition,  that

          Briggs' complaint does not contain a breach of contract count.

               These omissions  are  entirely  understandable.    The  only

          evidence offered  to support a comprehensive contract is the fact

          that  Martlet  originally  assigned some  distribution  rights to

          Briggs.  See App. at 346-47, 349-50.  The idea that a terminable-
                   ___

          at-will  contract   for  individual   products  could   imply  an

          enforceable obligation  to grant future  distributorships, to say

          the least, does not carry conviction.



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specific   use  in  a  statute  that  has  for  many  years  been



          interpreted adversely to Briggs' view.



               The statutory language  strongly suggests  the more  limited



          "one  item" meaning  of brand.   Section  1451 (and  also section



          1452(1)(C))  speaks  of an  agreement  between  a certificate  of



          approval holder  and a wholesale licensee  authorizing the latter



          "to  distribute  one  or  more  of the  certificate  of  approval



          holder's  brands  of  malt  liquor."    (Emphasis  added.)    The
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          assumption appears to  be that a certificate  holder has multiple



          "brands,"  or "kinds,"  of wine  or beer.   Section  1453(1) then



          prohibits dual distributorships for individual brands  or labels,



          using the singular forms of those words.2  We think it  apparent,



          in light  of the  earlier use  of the  plural "brands," that  the



          prohibition  in  this section  concerns  discrete  products of  a



          manufacturer, and  does not bar multiple  distribution agreements



          for  differently  labelled  products of  a  single  manufacturer.



          Likewise, the obligation to maintain agreements in the absence of



          good  cause for changing or  terminating them must  apply only to



          the distribution rights of the individual "brands."



               If the  statutory language leaves any  doubt concerning this



          interpretation, it is dispelled by the testimony of Lynn Cayford,



          Director of Licensing for the Bureau of Liquor Enforcement of the



                              
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               2  The  provision  reads  as  follows:  "No  certificate  of

          approval  holder who  designates a  sales territory  for which  a

          wholesale licensee  is primarily  responsible may enter  into any

          agreement with  any other wholesale  licensee for the  purpose of

          establishing  an additional agreement  for its brand  or label in

          the same territory."



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State of Maine for  the past thirteen  years.  He testified  that



          the  agency treated "every label  as a separate  brand," and that



          this definition of "how we handle brands and how we handle labels



          is the same way we've handled them in my twelve years or thirteen



          years working there."



               Briggs  urges us  to  give  no  deference  to  the  agency's



          interpretation  because of the lack  of a definition  in the Act,



          the absence  of case law,  and the  fact that Cayford  is not  an



          attorney.   This is an original, if  meritless, argument.  As the



          Maine Supreme Judicial Court has made clear, "We shall accept the



          agency's  construction,  especially  if,  as  here,  it  is  long



          established  . .  .  unless it  clearly violates  the legislative



          intent."  Bar Harbor  Banking and Trust Co. v.  Superintendent of
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          the Bureau of Consumer Protection, 471 A.2d 292, 296 (Me. 1984).
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               The conclusory  assertions of Briggs' officers  that "brand"



          and  "label"  refer  in this  context  to  all  products using  a



          supplier's name do not  create a genuine issue of  material fact.



          There  was no  violation  of  the Act,  or,  a fortiori,  of  any
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          obligation of  good faith and fair dealing,  in Martlet's refusal



          to give Briggs the distributorship of its new brand, Molson Ice.



               Affirmed.
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