Midfield Concession Enterprises, Inc. v. Areas USA, Inc.

130 F. Supp. 3d 1122, 2015 U.S. Dist. LEXIS 123956, 2015 WL 5472286
CourtDistrict Court, E.D. Michigan
DecidedSeptember 17, 2015
DocketCASE NO. 2:14-cv-12174
StatusPublished
Cited by4 cases

This text of 130 F. Supp. 3d 1122 (Midfield Concession Enterprises, Inc. v. Areas USA, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. Michigan primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Midfield Concession Enterprises, Inc. v. Areas USA, Inc., 130 F. Supp. 3d 1122, 2015 U.S. Dist. LEXIS 123956, 2015 WL 5472286 (E.D. Mich. 2015).

Opinion

[1128]*1128 OPINION AND ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF MIDFIELD’S PARTIAL MOTION FOR SUMMARY JUDGMENT (Doc. 46), GRANTING IN PART AND DENYING IN PART DEFENDANTS AREAS USA AND AREAS MCNAMARA’S PARTIAL MOTION FOR SUMMARY JUDGMENT (Doc. 38), AND GRANTING COUNTERr-DEFENDANT SAMIR MASHNI’S MOTION FOR SUMMARY JUDGMENT (Doc. 40)

MARIANNE O. BATTANI, United States District Judge

I. INTRODUCTION

This matter is before the Court on three separate motions for summary judgment: (i) Plaintiff Midfield Concession Enterprises, Inc.’s Motion for Partial Summary Judgment (Doc. 46); (ii) Defendants Areas USA, Inc., and Areas McNamara JV, LLC’s (collectively, “Areas”) Motion for Partial Summary Judgment (Doc. 38); and (iii) Counter Defendant Samir Mashni’s Motion for Summary Judgment (Doc. 40).

The present action stems from a joint venture agreement between Plaintiff Midfield and Defendant Areas USA. Midfield alleges that Areas USA violated the Covenant Not to Compete found in this joint venture agreement and seeks judgment as a matter of law for the claims of Breach of Contract (Count I) and Breach of Fiduciary Duty (Count IV) found in its First Amended Complaint. (Doc. 25). In its Motion for Partial Summary Judgment, Midfield also seeks the following three declaratory judgments concerning Counts I through III of Areas USA’s Amended Counterclaim (Doc. 30): that Midfield did not waive the applicability of the Covenant Not to Compete (Count I); that Midfield did not commit an anticipatory breach of contract (Count -II); and that Midfield is entitled to summary judgment dismissing Areas USA’s interference with business relations claim (Count III). (Doc. 46). Counter-Defendant Samir Mashni, Midfield’s Vice-President and General Counsel, joins Midfield in his Motion for Summary Judgment seeking a declaratory judgment dismissing Areas USA’s interference with ■ business relations claim (CountIII). (Doc.40).

Areas USA maintains in its Amended Counterclaim and here seeks summary judgment that the Covenant Not to Compete is unenforceable because Midfield and Areas USA have waived its applicability through prior course of performance and, in the alternative, because it is an unreasonable restraint on trade (Count I). (Doc. 30). In their Motion for Partial Summary Judgment, Defendants further seek dismissal of: Midfield’s misappropriation of trade secrets claim (Count II); Midfield’s breach of contract for failure to pay capital costs claim (Count III); Midfield’s unjust enrichment claim against Areas USA (Count V); and Midfield’s unjust enrichment claim against Areas McNamara (CountVI). (Doc.38). :

For the following reasons, this Court GRANTS IN PART AND DENIES IN PART Plaintiff Midfield’s Partial Motion for Summary Judgment, GRANTS IN PART AND DENIES IN PART Defendants Areas USA and Areas McNamara’s Partial Motion for Summary Judgment, and GRANTS Counter Defendant Samir Mashni’s Motion for Summary Judgment.

II. STATEMENT OF FACTS

Midfield Concessions Enterprises, Inc., (“Midfield”) is a Michigan corporation in the business of establishing, managing and operating food and beverage concessions at various airports throughout the country. (PL’s First Am. Compl. ¶¶ 1, 5, Doc. 25). In particular, Midfield has operated food concessions at the Detroit Metropolitan Airport (“DTW”), including the “Mediter[1129]*1129ranean . Grill” Restaurant in the Soutb/McNamara Terminal, since 2002. (Id. at ¶ 9). Areas USA, Inc., is a Florida corporation that provides food, beverage and retail services in the U.S. travel and hospitality industries. (Id. at ¶¶ 2, 6). Representatives from Midfield and Areas USA began discussions sometime in -2QP6 or 2007 about forming a joint venture. CPUs Mot. for Partial Summ. J. 3, Doc. 46). These discussions culminated in the execution of the Amended Joint Venture Agreement (“JV Agreement”), (Doc. 46, Ex. A), on June 28, 2007, that created the Joint Venture entitled AREAS MCE Detroit, JV. (Doc.25, ¶8).

A. The Amended Joint Venture Agreement & Covenant Not to Compete

The purpose of the Joint Venture, as stated in § 1.6 of the JV Agreement, was to “operate a food concession or concessions at the Detroit Metropolitan Wayne County Airport (“Airport”) at- Detroit, Michigan, New North Terminal.-...” (Doc. 46, Ex. A at 1). In order to protect its interests in pre-existing concessions at the McNamara Terminal, including the Mediterranean- Grill Restaurant, Midfield insisted upon including a Covenant Not to Compete in the JV Agreement that applied to both the McNamara and North Terminals. (Mashni Dep., 51:19-52:2, Nov. 6, 2014, Doc. 46, Ex. C). The Covenant Not to Compete reads:

AREAS USA and MIDFIELD CONCESSION ENTERPRISES, INC. hereby agree not to compete for any food and beverage concessions at the Detroit Metropolitan Airport throughout the term of this Agreement. Either AREAS USA or MIDFIELD CONCESSION ENTERPRISES, INC., can, however, submit proposals to the Detroit Metropolitan Airport on their own if the other party does not wish to pursue said business opportunity at Detroit Metropolitan Airport.

(Doc. 46, Ex. A at 15). The process of acquiring a concession' begins when the DTW" Airport Authority requests proposals from qualified concessionaires, such as Midfield or Areas USA, to operate available concessions. (Mashni Decl., ¶ 3, Doc. 46, Ex. B). The Airport Authority holds various informational “Outreach Meetings” attended by concessionaires who may or may not opt to bid. (Id, at ¶ 11), After interested concessionaires submit their proposals, or bids, the Airport Authority evaluates and awards the concession to, the highest ranked bid, (Id. at ¶¶ 4-5).

B. Areas’ Alleged Breach of the Covenant Not to Compete: The McNamara Terminal Bids & Mediterranean Grill.

Midfield originally • acquired the McNamara Terminal’s Mediterranean Grill concession in 2002, (Doc. 46 at 4). Airport concessions are typically awarded for a period of ten years, and it became known that the DTW Airport Authority would be requesting new proposals for the McNamara Terminal concessions (“McNamara RFP”) in the summer of 2013. (Id,), The McNamara RFP was broken down into eight packages for bidding, with the Mediterranean Grill being Package # 6. (Id. at 5).

In either the fall or winter of 2012 at the Denver Airport, Samir Mashni, representing Midfield, discussed with Eduardo Uribe, Vice-President of Business Development at Areas USA, concerning the upcoming McNamara RFP. (Mashni Dep. 64:6-24). Uribe neither confirms nor denies that this conversation .occurred, claiming that he does not recall whether or not it took place. (Uribe Dep. 72:6-21, Nov. 21, 2014, Doc. 46, Ex. D). Specifically, Mashni testified that he informed Uribe that Midfield would be bidding to protect' [1130]*1130its current interests in the McNamara Terminal and inquired as to Areas USA’s bidding intentions. (Mashni Dep. 64:6-24). According to Mashni, Uribe said that Areas USA was unsure about whether, it would bid. (Id,.). Although Mashni told Uribe to notify him when Areas USA’s position was clear (id. at 76:14-16), Mashni never heard back from anyone at Areas USA (id. at 74:10-14). Midfield inferred from Areas USA’s silence that it would not be bidding for the Mediterranean Grill or any of Midfield’s current interests. (Id. at 74:15-24).

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130 F. Supp. 3d 1122, 2015 U.S. Dist. LEXIS 123956, 2015 WL 5472286, Counsel Stack Legal Research, https://law.counselstack.com/opinion/midfield-concession-enterprises-inc-v-areas-usa-inc-mied-2015.