Electronics Store, Inc. v. Cellco Partnership

732 A.2d 980, 127 Md. App. 385, 1999 Md. App. LEXIS 128
CourtCourt of Special Appeals of Maryland
DecidedJuly 7, 1999
Docket1576, Sept. Term, 1998
StatusPublished
Cited by38 cases

This text of 732 A.2d 980 (Electronics Store, Inc. v. Cellco Partnership) is published on Counsel Stack Legal Research, covering Court of Special Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Electronics Store, Inc. v. Cellco Partnership, 732 A.2d 980, 127 Md. App. 385, 1999 Md. App. LEXIS 128 (Md. Ct. App. 1999).

Opinion

ADKINS, Judge.

This is an appeal from the granting of a motion for summary judgment in the Circuit Court for St. Mary’s County in favor of Célico Partnership and Bell Atlantic NYNEX Mobile (collectively, Bell Atlantic), appellees, and Cedar Point Federal Credit Union and Cedar Point Financial Services, Inc. (collectively, Cedar Point), co-appellees, against The Electronics Store, Inc. (Electronics), appellant. Appellant timely noted this appeal.

Appellant asks us to determine whether: 1) the plain meaning of the parties’ agreement justifies a judgment for Bell Atlantic on appellant’s claim for breach of contract; 2) the agreement is ambiguous and requires parol evidence to explain its terms; and 3) there are factual issues that preclude the entry of summary judgment.

For the reasons that follow, we affirm in part and reverse in part, and remand the case to the circuit court for further proceedings consistent with this opinion.

FACTS

In the late 1980s, Electronics was interested in expanding its business, which sold consumer electronic products and offered an electronic repair service, to include sales of cellular telephones and service. At that time, the cellular telephone market was beginning to develop, and Electronics wished to provide consumers in the Southern Maryland area with cellular products. In pursuit of this interest, Electronics and Bell Atlantic entered into an agreement on July 2, 1990, to market Bell Atlantic’s cellular service.

*391 The agreement was a retail agency agreement in which Electronics could sell only Bell Atlantic’s cellular service, but not related products. Electronics leased space, advertised, and opened a retail store to coincide with the “light-off’ of the first cellular tower in St. Mary’s County. Shortly after the opening of its store, Electronics became an authorized Bell Atlantic non-exclusive sales agent pursuant to an agency contract entered into on August 1, 1991 (the Agreement). 1 Thereafter, Electronics was able to sell Bell Atlantic products, in addition to its cellular service, in a defined geographic area on a non-exclusive basis.

In the Agreement, Electronics was limited to selling only Bell Atlantic services and could not offer any competitive services. In addition, Electronics was not able to solicit purchasers and subscribers who were already receiving Bell Atlantic’s services through either Bell Atlantic itself or another retailer. The Agreement provided, inter alia, that Electronics could draw potential subscribers “from all classes of potential users.... ” It further provided: “Bell Atlantic reserves the right to market [cellular service] through its own direct sales organization, or other Agents, resellers, or otherwise, in the Area.” The Agreement, as amended, stated: “Nothing herein shall restrict or prohibit Bell Atlantic from, in its sole discretion, offering potential Subscribers in the Area, through its direct sales force or otherwise, volume discounts, promotional offers, new or modified price plans or any other special offers of [cellular service].” In other words, Bell Atlantic’s in-house sales department was not restricted by the contract from marketing its service in the same area in which Electronics was authorized to market Bell Atlantic’s services.

As compensation under the Agreement, Electronics received a commission for any subscriber “obtained by [Electronics] and accepted by Bell Atlantic” upon the activation of service to that subscriber by Bell Atlantic. A subscriber was defined as *392 the “ultimate user of [cellular service] provided by or through Bell Atlantic.”

By 1994, Electronics had successfully developed a loyal customer base. There was a steady increase in subscriber activations from 1991 to 1994, and Electronics received an achievement award from Bell Atlantic for outstanding sales. An increase in sales was also realized by the in-house direct sales force of Bell Atlantic. A portion of these sales from the in-house sales department caused this lawsuit.

Appellant’s complaints primarily surround the enrollment of Cedar Point members by the Bell Atlantic in-house direct sales force. In February 1993, Betty Koehl, then CEO of Cedar Point Federal Credit Union, purchased a cellular telephone for business use from Electronics. She also enrolled in an individual program. According to appellant, in late 1994, a member of Cedar Point’s Board of Directors telephoned Electronics and inquired about a discounted pricing program for Cedar Point. Electronics called upon its contact person at Bell Atlantic to begin the process of enrolling Cedar Point members. The process for enrolling a subscriber is set forth in the Agreement as follows:

Agent shall solicit Subscribers by using Bell Atlantic’s [cellular service] agreements and forms (the ‘Service Forms’), and shall comply with all Bell Atlantic procedures and practices for solicitation of, presentations to, and enrollment of, Subscribers.
Agent shall forward Service Forms, together with all security deposits within 24 hours of receipt of an executed Service Form.
Notwithstanding the foregoing, if Agent fails to forward Service Forms within seven (7) days of its receipt, Agent shall not be entitled to a Commission for such Subscriber.
*393 No contract between Bell Atlantic and a Subscriber shall exist until the Service Form is accepted and approved by Bell Atlantic.

Prior to forwarding the Service Forms, Electronics was informed by Bell Atlantic that the proposed major pricing plan for Cedar Point was denied because Cedar Point was a credit union.

Shortly thereafter, 2 a member of Bell Atlantic’s in-house sales staff contacted the CEO of Cedar Point and successfully negotiated a pricing plan. After approval by Cedar Point’s Board of Directors, Bell Atlantic and Cedar Point entered an agreement in February 1995 for cellular telephone service to Cedar Point at a discounted price. This occurred within months after Electronics requested Bell Atlantic to quote a discounted pricing plan for Cedar Point.

Subsequently, Electronics requested permission from Bell Atlantic to directly enroll Cedar Point members who “walked-in” to the store in the major pricing program. Bell Atlantic deferred to the CEO of Cedar Point who authorized Electronics to enroll “walk-in” customers in the program under the condition that: “The customers have to be credit union members in good credit standing and be approved by me. The Electronics Store can not advertise this program in any way.” Additionally, Cedar Point reserved the right to cancel the agreement with Electronics. Less than three months after the agreement between Electronics and Cedar Point to allow Electronics to enroll “walk-in” customers on behalf of Bell Atlantic, Cedar Point canceled the agreement because of alleged violations by Electronics.

*394 Electronics now claims that Bell Atlantic’s direct sales force improperly interfered with its potential sales to Cedar Point members.

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Bluebook (online)
732 A.2d 980, 127 Md. App. 385, 1999 Md. App. LEXIS 128, Counsel Stack Legal Research, https://law.counselstack.com/opinion/electronics-store-inc-v-cellco-partnership-mdctspecapp-1999.