HOWARD JOHNSON INTERNATIONAL, INC. v. MANOMAY, LLC

CourtDistrict Court, D. New Jersey
DecidedJuly 17, 2019
Docket2:16-cv-07621
StatusUnknown

This text of HOWARD JOHNSON INTERNATIONAL, INC. v. MANOMAY, LLC (HOWARD JOHNSON INTERNATIONAL, INC. v. MANOMAY, LLC) is published on Counsel Stack Legal Research, covering District Court, D. New Jersey primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
HOWARD JOHNSON INTERNATIONAL, INC. v. MANOMAY, LLC, (D.N.J. 2019).

Opinion

NOT FOR PUBLICATION

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY

HOWARD JOHNSON INTERNATIONAL, INC., Civil Action No: 16-7621-SDW-LDW Plaintiff, OPINION v.

MANOMAY, LLC, et al., July 16, 2019 Defendants.

WIGENTON, District Judge. Before this Court is Plaintiff Howard Johnson International, Inc.’s (“Plaintiff” or “Howard Johnson”) Motion for Summary Judgment pursuant to Federal Rule of Civil Procedure 56. Jurisdiction is proper pursuant to 28 U.S.C. § 1332. Venue is proper pursuant to 28 U.S.C. § 1391. This opinion is issued without oral argument pursuant to Federal Rule of Civil Procedure 78. For the reasons stated herein, Plaintiff’s motion is GRANTED. I. BACKGROUND AND PROCEDURAL HISTORY Plaintiff is a Delaware corporation with a principal place of business in New Jersey. (D.E. 1 ¶ 1, Ex. A. at 21.)1 Defendant Manomay, LLC (“Manomay”) is a limited liability company organized under the laws of and maintaining a principal place of business in Florida. (Id. ¶ 2.)

1 Citations to “D.E. 1” refer to the Verified Complaint filed in this matter and the documents attached thereto. Citations to “D.E. 45-3” refer to Plaintiff’s Statement of Undisputed Material Facts and the citations contained therein. Citations to “D.E. 54-3” refer to Defendants’ Response to Plaintiff’s Statement of Undisputed Material Facts and the citations contained therein. Defendants Pranit Patel, Dipak Patel, Nita Patel, and Jagruti Patel (collectively, the “Patels”) are the constituent members of Manomay. (Id. ¶¶ 3-7; Ex. A Schedule B.)2 On or about June 30, 2011, Plaintiff entered into a franchise agreement (the “Agreement”) with Manomay permitting Manomay to operate a 262-room Howard Johnson® guest lodging

facility in Altamonte Springs, Florida (the “Facility”) for a period of fifteen years. (D.E. 45-3 ¶¶ 14-16; 54-3 ¶¶ 14-16; 1 Ex. A.) Under the terms of the Agreement, Manomay was required to make certain periodic payments to Plaintiff (“Recurring Fees”). (D.E. 45-3 ¶¶ 17-28; 54-3 ¶¶ 17- 28; 1 Ex. A §§ 7, 18.1 and Schedule C.) Section 18.4 of the Agreement granted either party the right to terminate, provided that the party seeking to terminate had “paid all fees and charges due under th[e] Agreement . . . as of the date [of] notice of termination and as of the effective date of the termination.” (D.E. 1 Ex. A § 18.4.) In addition, in the event Manomay failed to comply with its obligations and responsibilities under the Agreement, Plaintiff was allowed to terminate the Agreement and to seek liquidated damages and attorneys’ fees and costs incurred in attempting to enforce the Agreement’s terms. (D.E. 45-3 ¶¶ 31-36; 54-3 ¶¶ 31-36; 1 Ex. A §§ 11.2, 12.1, 18.3.)

On the same day the Agreement was signed, the Patels executed a guaranty (“Guaranty”) of Manomay’s obligations under the Agreement. (D.E. 45-3 ¶¶ 41-44; 54-3 ¶¶ 41-44; 1 Ex. B.) On December 10, 2014, Manomay sent Plaintiff a letter purporting to be a “Notice of Termination,” pursuant to Section 18.4 of the Agreement (the “December 10th Letter”). (D.E. 54- 2 Ex. D.) At the time that letter was sent, Manomay was in arrears on Recurring Fees owed under the Agreement. (D.E. 54-3 ¶ 18.) On January 16, 2015, Plaintiff advised Manomay in writing that it was in breach of the Agreement for failure to pay those fees, granted the company time to cure

2 Pranit Patel is a citizen of Florida and the other Patel defendants are citizens of New Jersey. (D.E. 1 ¶¶ 3-6.) the default, and stated that failure to do so could lead to termination of the Agreement. (D.E. 54- 2 Ex. E.) Defendants continued to fail to meet their financial obligations under the Agreement. (D.E. 45-3 ¶¶ 45-47; 54-3 ¶¶ 45-57.) On August 28, 2015, November 4, 2015, February 10, 2016, April

21, 2016, and May 18, 2016, Plaintiff again advised Defendants in writing that they were in breach of the Agreement for failing to pay Recurring Fees, granted them time to cure their default, and stated that failure to do so could lead to termination of the Agreement. (D.E 45-3 ¶¶ 46-50; 54-3 ¶¶ 46-50.) Defendants did not remit the required payments, and on July 25, 2016, Plaintiff sent Manomay a final written notice, indicating it was terminating the Agreement and demanding that Manomay perform its “post-termination obligations such as the removal of all items that display or refer to the Howard Johnson brand at the Facility,” and pay Recurring Fees owed through the date of termination and liquidated damages. (D.E. 45-3 ¶ 51; 54-3 ¶ 51.) Manomay did not remove the exterior signage bearing Plaintiff’s registered trademarks, nor did Defendants make the demanded payments. (D.E. 45-3 ¶¶ 54-57; 54-3 ¶¶ 54-57.)

In an eight-count Complaint filed in this Court on October 20, 2016, Plaintiff asserted claims against Defendants for breach of the Agreement and the Guaranty as well as a Lanham Act claim for unauthorized use of Howard Johnson® marks, and sought an award of Recurring Fees, liquidated damages, interest, attorneys’ fees, and costs. (D.E. 1 at 10-19.)3 On February 8, 2019, Plaintiff filed the instant motion for summary judgment. (D.E. 45.) Briefing was completed as of May 28, 2019. (D.E. 54, 59.)

3 Plaintiff also seeks an accounting (Count Two) and a declaratory judgment that Plaintiff may “enter the property at the Facility and remove any and all exterior signage, exterior items and other exterior materials displaying the Howard Johnson marks” (Count Eight). (D.E. 1.) II. LEGAL STANDARD Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The “mere existence of some alleged factual dispute between the parties will not defeat an

otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–48 (1986) (emphasis in original). A fact is only “material” for purposes of a summary judgment motion if a dispute over that fact “might affect the outcome of the suit under the governing law.” Id. at 248. A dispute about a material fact is “genuine” if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id. The dispute is not genuine if it merely involves “some metaphysical doubt as to the material facts.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). The moving party must show that if the evidentiary material of record were reduced to admissible evidence in court, it would be insufficient to permit the nonmoving party to carry its

burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 322–23 (1986). Once the moving party meets its initial burden, the burden then shifts to the nonmovant who must set forth specific facts showing a genuine issue for trial and may not rest upon the mere allegations, speculations, unsupported assertions or denials of its pleadings. Shields v. Zuccarini,

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