Canon U.S.A., Inc. v. Cavin's Business Solutions, Inc.

208 F. Supp. 3d 494, 2016 WL 5349785
CourtDistrict Court, E.D. New York
DecidedSeptember 23, 2016
DocketNo. 15-CV-05634 (JFB)(AKT), No. 15-CV-05637 (JFB)(AKT), No. 15-CV-05638 (JFB)(AKT), No. 15-CV-05639 (JFB)(AKT)
StatusPublished
Cited by6 cases

This text of 208 F. Supp. 3d 494 (Canon U.S.A., Inc. v. Cavin's Business Solutions, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Canon U.S.A., Inc. v. Cavin's Business Solutions, Inc., 208 F. Supp. 3d 494, 2016 WL 5349785 (E.D.N.Y. 2016).

Opinion

MEMORANDUM AND ORDER

JOSEPH F. BIANCO, District Judge:

Plaintiff, Canon U.S.A., Inc. (“Canon” or “plaintiff’), commenced these four actions on September 29, 2015, bringing breach of contract and fraud claims against Cavin’s Business Solutions, Inc. (“Cavin’s”), Élan Marketing, Inc. d/b/a Élan Office Systems (“Élan”), Zeno Office Solutions, Inc. (“Zeno”), and The Lioce Group, Inc. (“Lioce”) (together, “defendants” or the “retail dealers”), as well as a claim for the violation of the North Carolina Unfair and Deceptive Trade Practices Act, N.C. Gen. Stat. §§ 75-1.1 et seq. against Cavin’s, a claim for the violation of the Nevada Deceptive Trade Practices Act, Nev. Stat. §§ 598.0903 et seq. against Élan, and a claim for the violation of the Florida Deceptive and Unfair Trade Practices Act, Fla. Stat. §§ 501.201 et seq. against Zeno. On December 4, 2015, all four cases were deemed related and 15-CV-05637, 15-CV-[497]*49705638, and 15-CV-05639 were re-assigned to this Court.

Defendants move to dismiss plaintiffs complaints pursuant to Federal Rules of Civil Procedure 9(b), 12(b)(1), and 12(b)(6). For the reasons set forth below, the Court denies defendants’ motions to dismiss plaintiffs breach of contract claims and grants defendants’ motions to dismiss plaintiffs fraud claims and claims for the violation of the North Carolina Unfair and Deceptive Trade Practices Act, the Nevada Deceptive Trade Practices Act, and the Florida Deceptive and Unfair Trade Practices Act.

More specifically, with respect to the breach of contract claim, defendants argue that the one-year statute of limitations set forth in the Office Imaging Retail Dealer Agreements (the “Dealer Agreements”) bars these lawsuits. However, plaintiff asserts that the exception in that statute of limitations provision for suits involving disputes about “payment of the purchase price of the products” applies to the instant lawsuits regarding the Canon Strategic Marketing Plan Program (the “CSMP Program”), which incentivizes retail dealers with specific monetary credits in connection with the sale of certain business equipment. Although defendants argue that the CSMP Program does not involve the “payment of the purchase price of the products” and the instant dispute cannot possibly fall within that exception, the Court cannot make that determination in this case at the motion to dismiss stage. The operation of the CSMP Program is complex and the Court is unable to determine from the face of the complaints whether or not the CSMP Program would fall within the “payment of the purchase price of the products” exception. Thus, the motions to dismiss the breach of contract claims are denied.

However, the motions are granted with respect to the fraud claims because, based upon the complaints, it is clear that the fraud claims are duplicative of the breach of contract claims. In addition, the Court dismisses plaintiffs claims under the consumer protections laws of North Carolina, Nevada, and Florida because the parties agreed in the Dealer Agreements to a New York choice-of-law provision, and applying New York law to this case does not violate fundamental public policies of the other jurisdictions, nor do any of these jurisdictions have a materially greater interest in this dispute.

I. Background

A. Factual Background

Unless otherwise noted, the following facts are taken from the complaint (“Compl.”) filed against Cavin’s in 15-CV-05634. Defendants assert that Canon “us[ed] the same boilerplate complaint” in each lawsuit (Cavin’s Mot. to Dismiss at 1), and plaintiff concedes that the allegations in each of the four actions at issue are “predicated upon separate but essentially identical misconduct committed by the [defendants while serving as independent authorized retail dealers” of Canon-brand business equipment. (Pl.’s Opp’n at 1.)

Canon is the exclusive wholesale distri-buter of Canon-brand products in the United States. (Compl. ¶ 6.) Canon is a New York corporation with its headquarters and principal place of business in Melville, New York. (Id. ¶ 1.) Canon markets Canon-brand business equipment, such as high-speed printers, copiers, and fax machines, as well as accessories and spare parts, to end-user customers through a nationwide network of authorized, independent Canon retail dealers. (Id. ¶¶ 6-8.) Authorized Canon retail dealers also maintain service staffs trained by Canon to provide end-user customers with maintenance and repair services for Canon-brand business [498]*498equipment. (Id. ¶ 8.) End-users can buy or lease Canon business equipment and, consequently, UCC-1 financing statements are routinely filed in connection with the acquisition by end-user customers of Canon business equipment. (Id. ¶ 9.)

Canon offers and contractually requires its authorized retail dealers to utilize promotional programs in connection with the retail dealers’ marketing of Canon-brand business equipment. (Id. ¶ 10.) These programs include the CSMP Program, which is designed to “incentivize and reward authorized Canon retail dealers for their efforts to market Canon-brand business equipment to larger end-user customers who make commitments to acquire multiple units of business equipment over a specified period of time.” (Id. ¶ 11.) Large end-user customers (“CSMP customers”) commit to acquire or lease from a retail dealer units of Canon business equipment that has an aggregate wholesale price of a specified amount for a specified time period. (Id. ¶ 12.)

The retail dealers submit information regarding the placement of each unit of Canon business equipment and Canon provides “specific monetary credits” to the retail dealer for purchase or lease of the units of equipment that the retail dealer documents as having been placed with CSMP customers. (Id. ¶¶ 12, 14.) If the retail dealer does not purchase enough equipment from Canon for placement with the CSMP customers to meet the proposed target, Canon “charges back” the credits. (Id. ¶ 12.) Canon alleges that the credits it provides under the CSMP Program are “discounts” from the purchase price of the equipment that retail dealers have placed with CSMP customers. (Id.) Canon alleges that it does not have a way of independently identifying that a unit has been placed with a particular CSMP customer; this identification is carried out by each retail dealer. (Id. ¶ 14.) The retail dealer identifies each unit of business equipment with a serial number and provides Canon with documentation detailing the placement of each unit with a CSMP customer for which the retail dealer is seeking the issuance of a credit pursuant to the CSMP Program. (Id.)

Canon and all of its retail dealers enter into a written authorized retail dealer agreement. The Dealer Agreements set forth the terms and conditions of the retail dealers’ business relationships with Canon. (Id. ¶ 7.) Cavin’s is a retail dealer and distributor of office equipment headquartered in North Carolina. (Id. ¶¶2, 19.) Cavin’s entered into, the Dealer Agreement with Canon in or about February 2011. (Id. ¶ 19.) Élan is a- Nevada corporation with its headquarters and principal place of business in Nevada. (Élan Compl. ¶ 2.) Élan entered into the Dealer Agreement with Canon in July 2005. (Id. Ex.

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Bluebook (online)
208 F. Supp. 3d 494, 2016 WL 5349785, Counsel Stack Legal Research, https://law.counselstack.com/opinion/canon-usa-inc-v-cavins-business-solutions-inc-nyed-2016.