Campbell v. Austin Air Systems, Ltd.

423 F. Supp. 2d 61, 2005 U.S. Dist. LEXIS 40355, 2005 WL 2405997
CourtDistrict Court, W.D. New York
DecidedSeptember 29, 2005
Docket02-CV-651S
StatusPublished
Cited by6 cases

This text of 423 F. Supp. 2d 61 (Campbell v. Austin Air Systems, Ltd.) is published on Counsel Stack Legal Research, covering District Court, W.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Campbell v. Austin Air Systems, Ltd., 423 F. Supp. 2d 61, 2005 U.S. Dist. LEXIS 40355, 2005 WL 2405997 (W.D.N.Y. 2005).

Opinion

DECISION AND ORDER

SKRETNY, District Judge.

I. INTRODUCTION

In this case, Plaintiff Douglas Campbell d/b/a Campbell Environmental Systems (“Campbell”), a distributor of air cleaners, alleges that Defendant Austin Air Systems, Ltd. (“Austin”), a manufacturer of air cleaners, engaged in price fixing, terminated his distributorship, discriminated between distributors with respect to pricing, tortiously interfered with his customer contracts, and breached the terms of its own distributorship agreement. Plaintiff seeks relief under federal anti-trust law as well as New York law. Currently before this .Court is Defendant’s Motion for Summary Judgment on Plaintiffs claims and on its own counterclaim for unpaid invoices.

II. BACKGROUND

A. Factual Summary

The following facts are undisputed for purposes of the instant motion, except *64 where indicated. Defendant Austin manufactures portable air cleaners and filters, and sells these products principally through non-exclusive dealers. (Defendant’s Rule 56 Statement of Undisputed Material Facts (“Def.’s State.”), 1 ¶¶4, 5). Plaintiff Campbell acted for several years without a contract as a distributor of Austin Air Cleaners until 2002. (Def.’s State., ¶¶ 21, 22). On March 25, 2002, Plaintiff signed a written Authorized Dealership Agreement (“Agreement”) with Austin. (Def.’s State., ¶¶22, 23). The Agreement explicitly states that dealers could sell Austin Air Cleaners for any price. (Def.’s State., ¶ 26; Domon Ajf., Exh. A, ¶ 3(f)). 2 Moreover, the Agreement provides that either Austin or the dealer may terminate the Agreement at any time, with or without cause, upon seven days prior notice to the other party. (Def.’s State., ¶28; Do-mon Ajf., Exh. A, ¶ 6(e)).

With respect to promotion or advertisement of Austin products on the Internet, the Agreement requires that the dealer submit its proposed Internet page or any modification to its existing page to Austin for approval. (Def.’s State., ¶27; Domon Aff., Exh. A, ¶ 4(a), (c)). Most significantly, the Agreement states that “any Internet advertising of Products must show the price [the] Dealer is selling for[, and this] pricing must be the same or higher than Austin’s Advertising Price Schedule as it may be amended from time to time.” (Def.’s State., ¶27; Domon Aff., Exh. A, ¶ 4(f)). Austin initiated this Advertising Price Schedule for the Internet, a species of minimum advertising pricing (“MAP”), after Campbell suggested it in a September 13, 2001 e-mail to Austin’s President Richard Taylor (“Taylor”). (Def.’s State., ¶¶ 10-14; Appendix to Def.’s State. (“App. ”). Ex. A). The e-mail, sent under the subject line “Austin Air Lowball Internet Advertisers,” apprised Taylor that marketers were advertising prices on the Internet that were lower than the retail price. (Def.’s State., ¶¶ 10-11; Campbell Dep., p. 22-23 (attached as Ex. B to App.); App., Ex. A). Campbell attached to his email examples of web pages from other marketers and complained that replacement filters were being advertised for “far less than what they should be sold for.” (Def.’s State., ¶¶ 11-13, Campbell Dep., pp. 25-27; App, Ex. A). According to Campbell’s e-mail, his advertising costs had gone up and his sales had dropped since a new Internet software was introduced which allowed companies to outbid other companies for favorable placement on an Internet search engine. (Def. ’s State., ¶ 12; Campbell Dep., p. 23-25; App., Ex. A). Campbell stated to Taylor that MAP was the proven “way to go,” based on his prior experience as a consultant for Miele Vacuum. (Def.’s State., ¶ 14, Campbell Dep., pp. 28-29; App, Ex. A). Campbell suggested that other Austin distributors should be suspended until they complied with the MAP policy, and stated that “the minute you start suspending a few distributorships and halting shipment, they will listen — THEY WILL LISTEN!” (Def.’s State., ¶ 15, Campbell Dep., p. 30; App., Ex. A).

At his deposition, Campbell acknowledged the difference between MAP, the minimum price for which a dealer may advertise, and the actual price for which a *65 dealer could actually sell a product. (Def.’s State., ¶ 16, Campbell Dep., pp. 30-31). Further, Campbell opined that the sales process only becomes competitive after a consumer contacts the distributor for a price. (Def. ’s State., ¶ 17, Campbell Dep., pp. 31-32).

According to his deposition testimony, Campbell voiced concerns in the fall of 2001 about new credit policies implemented by Robert Mahaney, Austin’s comptroller. (Def.’s State., ¶ 18, Campbell Dep., pp. 46-54). Mahaney testified that Austin initially extended Campbell a $25,000 line of credit. (Def.’s State., ¶ 19, Mahaney Dep., p. 35 (attached as Ex. D to Aff.)). Austin eventually increased Campbell’s credit limit to $35,000. (Def.’s State., ¶ 19, Mahaney Dep., p. 35). According to Austin, its distributors, including Mr. Campbell, were charged set list prices, which were raised across the board in 2002. (Def.’s State., ¶ 20). However, according to the sworn affidavit of Heather Peterson, a former Austin employee, Austin only raised the unit prices for a handful of distributors, including Campbell. (Peterson Aff., ¶ 9). 3

Austin unilaterally terminated its Agreement with Campbell on June 17, 2002. (Def.’s State., ¶29; Doman Aff., Exs. A, B). Austin alleges that it was forced to terminate Campbell as a dealer because he refused to comply with Austin’s Internet advertising policy. (Taylor Aff., ¶ 18). For example, Austin alleges that Campbell’s Internet advertisement claimed the “lowest prices,” without specifying Austin’s list price. (Taylor; 15, 18). Austin contends that when he was confronted, Campbell initially added the list price to his website, but subsequently deleted the price after Austin confirmed that the site was in compliance. (Taylor Aff, ¶¶ 15, 18).

Campbell disputes Austin’s contention that he was terminated for refusing to comply with Austin’s Internet MAP policy. (PI. ’s State., ¶¶ 9-14). Rather, Campbell claims that his problems with Austin began in September of 2001 when he sold deeply discounted air filter systems to victims of the 9/11 tragedy in New York City. (Campbell Aff., ¶ 7). Campbell contends that his competing distributors complained to Austin about the discounts he was providing.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Hall v. Anheuser-Busch LLC
D. Connecticut, 2021
Fido's Fences, Inc. v. Canine Fence Co.
672 F. Supp. 2d 303 (E.D. New York, 2009)
Trevino v. Pechero
592 F. Supp. 2d 939 (S.D. Texas, 2008)

Cite This Page — Counsel Stack

Bluebook (online)
423 F. Supp. 2d 61, 2005 U.S. Dist. LEXIS 40355, 2005 WL 2405997, Counsel Stack Legal Research, https://law.counselstack.com/opinion/campbell-v-austin-air-systems-ltd-nywd-2005.