B&S Transport, Inc. v. Bridgestone Americas Tire Operations, LLC

171 F. Supp. 3d 669, 2016 U.S. Dist. LEXIS 36268, 2016 WL 1089394
CourtDistrict Court, N.D. Ohio
DecidedMarch 21, 2016
DocketCASE NO. 5:13-cv-2793
StatusPublished
Cited by6 cases

This text of 171 F. Supp. 3d 669 (B&S Transport, Inc. v. Bridgestone Americas Tire Operations, LLC) 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
B&S Transport, Inc. v. Bridgestone Americas Tire Operations, LLC, 171 F. Supp. 3d 669, 2016 U.S. Dist. LEXIS 36268, 2016 WL 1089394 (N.D. Ohio 2016).

Opinion

MEMORANDUM OPINION

HONORABLE SARA LIOI, UNITED STATES DISTRICT JUDGE

This matter is before the Court on the parties’ cross motions for summary judgment. Plaintiffs B&S Transport, Inc. (“B&S”) and Ronnie Harris (“Harris”) (collectively, “plaintiffs”) seek partial summary judgment in their favor and against defendants Bridgestone Americas Tire Operations, LLC (“BATO”) and Bridgestone Americas, Inc. (“BA”) (collectively, “defendants” or “Bridgestone”) with respect to three claims in the first amended complaint. (Doc. Nos. 86 and 87 [“PL Mot.”].) Defendants opposed plaintiffs’ motion (Doc. No. 105 [“Def. Opp’n”]), to which plaintiffs replied (Doc. No. 109 [“PI. Reply”]).

Defendants seek summary judgment on all claims asserted in plaintiffs’ first amended complaint, and on defendants’ counterclaims. (Doc. No. 84 and 90 [“Def. Mot.”].) Plaintiffs opposed defendants’ motion (Doc. No. 106 [“PL Opp’n”]), to which defendants replied (Doc. No. 112 [“Def. Reply”]).

For the reasons that follow, defendants’ motion for summary judgment is granted with respect to plaintiffs’ first claim for relief pursuant to 42 U.S.C. § 1981, and plaintiffs’ motion for summary judgment with respect to the same claim is denied. Plaintiffs’ state law claims, and defendants’ counterclaims, are dismissed without prejudice, pursuant to 28 U.S.C. § 1367(c)(3).

I. BACKGROUND

The basic factual background of this case is not in dispute. Plaintiff Harris is the founder of plaintiff B&S and its majority stockholder; Harris’s wife owns the remaining shares. (Doc. No. 47 (First Amended Complaint [“FAC”]) ¶ 14.) B&S is a minority owned self-described African American company, which became an authorized dealer of Firestone tires between 1977 and 1979, and of Bridgestone tires after Bridgestone acquired Firestone. (FAC ¶¶ 15,17, 21-22.)

[675]*675B&S and Bridgestone entered into the dealership agreement in 1991. It consists of a standard dealership agreement, amended by a letter agreement dated April 1,1991 (FAC ¶ 23; Doc. No. 84-3, Ex. 1 [“Agreement”]), and is governed by the laws of the State of California (Agreement at 8161 ¶ 13).

The agreement was tailored to allow B&S to pursue “ ‘minority set-aside’ business in order to obtain incremental sales and profits for both of us.” (Id. at 819.) Because of the nature of this business, the agreement did not limit B&S geographically, and B&S was not required to provide service and warranty work performed by a typical tire dealer. (Id.) The agreement acknowledged that these differences provided B&S with “certain advantages” not provided to other dealers, and that “[i]t must be understood that these advantages are to be used only to obtain incremental business for us and to genuinely assist your minority enterprise, and not to disrupt our existing distribution system by merely displacing sales which would otherwise be made by our current dealers or by Bridgestone itself.” (Id. at 819-20.) Among the advantages to B&S was that Bridge-stone would drop-ship tires directly to B&S’s customers.2 (Doc. No. 85-3 (Deposition of Ronnie Harris [“Harris Dep.”]) at 1124 (59-60).3)

Thus, defendants proposed to proceed on a “deal-specific” basis. B&S was not limited to “minority set-aside” business, but could pursue “any sales which are determined by Bridgestone to be incremental to Bridgestone.” Moreover, B&S was free to deal in competitors’ products, and defendants were free to utilize other minority enterprises. (Agreement at 820.)

With respect to termination, the agreement provided that:

At any time, and for any reason, either party may terminate this relationship with 30 days’ written notice, provided that each party shall honor all commitments incurred prior to the effective date of any such termination. Upon such termination, all amounts due and owed Bridgestone are immediately payable. The intent of this approach is that our business should — and can best — grow over the long-term if it is based primarily on our developing relationship, upon whatever success we have, and upon mutual good faith.

(Id. at 820; see also id. at 815, ¶ 8(a).)

Over the years of the agreement, B&S purchased tires from Bridgestone on credit, sold the tires and was paid by its customers, then paid Bridgestone for the tires. (Harris Dep. at 1147-48 (152-53).) Harris personally guaranteed any indebtedness of B&S to Bridgestone. (Doc. No. 65 at 655-660 [“Guaranty”].) The guaranty is governed by the laws of Tennessee. (Id. at 658, ¶ L.)

On February 28, 2013, Harris received a hand-delivered letter from Kurt Danielson [676]*676(“Danielson”), President of Bridgestone Commercial Solutions, .informing Harris that Bridgestone was terminating B&S’s dealership agreement. (FAC ¶¶ 32-33; Doc. No. 47-2 [“Termination Letter”].) According to the letter, “Bridgestone’s reasons for termination includes [sic] Bridgestone’s change in distribution and [go-to-market] solutions strategies.” (Termination Letter at 511.) The letter states that, in order to give B&S time to wind down its business with Bridgestone, B&S would remain an authorized dealer until December 31, 2013, and Bridgestone would continue to provide B&S with tires through that date. (Id.)

The instant action arises from Bridge-stone’s termination of B&S’s dealership, and the first amended complaint asserts one federal claim and five state claims. With respect to the federal claim, plaintiffs allege, pursuant to 42 U.S.C. § 1981, that Bridgestone’s termination of the agreement was an intentional act of race discrimination and, after the termination letter was issued, B&S received less favorable treatment than did a non-minority Bridgestone dealer — Pomp’s Tire Service, Inc. (“Pome’s”). (FAC ¶¶ 40-68.)

With respect to their state law claims, plaintiffs allege breach of contract (second claim — FAC ¶¶ 69-76), breach of implied covenant of good faith and fair dealing (third claim — FAC ¶¶ 77-86), promissory estoppel (fourth claim — FÁC ¶¶ 87-97), intentional interference with contract' (fifth claim — FAC ¶¶ 98-103), and fraud (sixth claim — FAC ¶¶ 104-113).

Defendants deny liability with respect to all of plaintiffs’ claims, and assert counterclaims for breach of contract, account, and unjust enrichment, alleging that plaintiffs have not paid Bridgestone for tires purchased from Bridgestone on credit in the sum of $955,144.16. (Doc. Nos. 49 and 64 [“Counterclaims”].)- In answering defendants’ counterclaims, plaintiffs deny that defendants have been damaged at all, or in the sums alleged. (Doc. No. 70 [“Answer to Counterclaims”].)

Defendants move for summary judgment on all claims asserted in plaintiffs’ first amended complaint, and on defendants’ counterclaims. Plaintiffs seek partial summary judgment with respect to their first (§ 1981 race discrimination), second, (breach of contract), and third (breach of implied covenant of good faith) claims.

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Cite This Page — Counsel Stack

Bluebook (online)
171 F. Supp. 3d 669, 2016 U.S. Dist. LEXIS 36268, 2016 WL 1089394, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bs-transport-inc-v-bridgestone-americas-tire-operations-llc-ohnd-2016.