Mark III Systems, Inc. v. Sysco Corporation

CourtCourt of Appeals of Texas
DecidedFebruary 22, 2007
Docket01-05-00488-CV
StatusPublished

This text of Mark III Systems, Inc. v. Sysco Corporation (Mark III Systems, Inc. v. Sysco Corporation) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mark III Systems, Inc. v. Sysco Corporation, (Tex. Ct. App. 2007).

Opinion

Opinion issued February 22, 2007





In The

Court of Appeals

For The

First District of Texas



NO. 01-05-00488-CV



MARK III SYSTEMS, INC., Appellant



V.



SYSCO CORPORATION, Appellee



On Appeal from the 295th District Court

Harris County, Texas

Trial Court Cause No. 2003-25677A



MEMORANDUM OPINION

Appellant, Mark III Systems, Inc. ("Mark III"), appeals the trial court's rendition of summary judgment in favor of appellee, Sysco Corporation ("Sysco"). In 14 issues, Mark III challenges several of the possible grounds for the trial court's rendition of summary judgment against it and argues that issues of fact were raised as to each of its claims against Sysco. In three additional issues, Mark III argues that the trial court erred in (1) denying its objections to Sysco's summary judgment evidence and (2) granting Sysco's objections to Mark III's summary judgment evidence. We affirm. Background

A. The Parties and Their Dealings

In July of 2001, Sysco, a marketer and distributor of food service products in North America, issued a Request for Proposal ("RFP") seeking a vendor for IBM p-series and i-series products and services. The RFP was sent to several companies, including Mark III and Business Integrators, Inc. ("BI").

According to Mark III's statement of facts, at the time Sysco's RFP was issued, Mark III and BI were involved in a business relationship in which the two companies shared information and customers. The relationship between Mark III and BI was formalized in a General Products and Service Agreement ("GPS Agreement"), which established a procedure for recruiting new business by offering a more comprehensive line of products and services through the joint efforts of the two companies. Although Sysco was never made aware of the GPS agreement, Mark III alleges that it was pursuant to this agreement that the two companies submitted a joint proposal in response to Sysco's RFP. In the joint proposal, Mark III offered discount pricing on p-series products and BI offered to supply Sysco with i-series products.

Leslie Powell, CEO of Mark III, testified by deposition that, before selecting its vendors, Sysco asked the two companies to draft a document stating that they would work together as a single service provider. Mark III and BI complied and sent Sysco a letter stating that (1) Powell would serve as a single point of contact for any issues that might arise and (2) both companies understood that, "if there [were] any issues with either company that [could not] be resolved to [Sysco's] satisfaction, it would be grounds for both companies to lose [Sysco's] business." This letter is referred to by Mark III as the "letter agreement" and was signed by Powell and Bob Baugh, President of BI.

Approximately one month after it received the letter agreement, Sysco sent an email informing the companies that had responded to the RFP of its decision to use Mark III as its p-series vendor and BI as its i-series vendor. In relevant part, the email stated:

You should be proud. All the presentations were very informative and enlightening. Each company had their [sic] strengths and areas of expertise. However, after several weeks of discussions, the Sysco Corporation Selection Committee has selected Business Integrators as our IBM business partner for the i-series and Mark III as the IBM business partner for the p-series.



After sending this email, Sysco submitted purchase orders to Mark III and BI for the remainder of 2001 and the majority of 2002. Mark III alleges that Sysco had no complaints about the services it was provided during this time.

According to Powell's affidavit testimony, BI's recruiting division placed Clive Huckins at Sysco as the manager of all p-series and i-series projects involving Mark III and BI in late 2002. After obtaining this position, Huckins terminated several Sysco employees and replaced them with personnel obtained through BI's recruiting division. In February of 2003, he requested a meeting with Mark III. At the meeting, Huckins informed Mark III that he believed Sysco could acquire better pricing terms if it purchased all of its equipment from one IBM provider, namely BI. BI then informed Mark III that it would be handling a project for Sysco as a single IBM business partner, rather than together with Mark III. Subsequent to this solo project, BI began taking on other opportunities at Sysco without Mark III's approval.

Eventually, Mark III was informed that Sysco had elected to purchase all of its computer equipment from BI because BI was able to provide better pricing. According to Powell, BI was able to underbid Mark III only because Huckins provided BI with the pricing and configuration quotes Mark III originally submitted to Sysco. Powell conceded that Sysco had no knowledge of any agreement between Mark III and BI to keep pricing information confidential. Powell further conceded that both Mark III and BI reviewed all of the information, including the pricing discounts, that was provided to Sysco in their joint response to the RFP. Sysco terminated its relationship with Mark III and continued its relationship with BI.

B. The Lawsuit and Summary Judgments

Mark III filed suit against both BI and Sysco. Its initial allegations against Sysco included causes of action for (1) breach of contract, (2) tortious interference with business contracts and relationships, (3) conspiracy to breach BI's fiduciary duty and aiding and abetting BI's breach of fiduciary duty, and (4) spoliation of documents. Sysco responded by filing its first traditional and no-evidence motion for summary judgment, attacking each of the causes of action raised in Mark III's sixth amended petition. Before the trial court ruled on Sysco's first motion for summary judgment, however, Mark III filed its seventh amended petition alleging a new claim that Sysco participated in and assisted with BI's (1) breach of fiduciary duty, (2) breach of duty of good faith and fair dealing, (3) misappropriation of trade secrets, (4) tortious interference, and (5) fraudulent conduct. The trial court granted Sysco's first motion for summary judgment in December of 2004, disposing of only those claims asserted by Mark III in its sixth amended petition.

Mark III then filed an eighth and ninth amended petition, to which Sysco responded with a second, third, and fourth motion for summary judgment. No action was taken by the trial court on Sysco's second motion for summary judgment. The third and fourth motions attacked each of Mark III's remaining claims. The fourth motion prayed for final summary judgment and severance. The trial court granted Sysco's third and fourth motions for summary judgment and severance in April of 2005.

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Mark III Systems, Inc. v. Sysco Corporation, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mark-iii-systems-inc-v-sysco-corporation-texapp-2007.