Portland Pirates v. Cumberland Cty Rec. Ctr.

Opinion

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BUSINESS AND CONSUMER COURT STATE OF MAINE CUMBERLAND, ss Location: Portland '

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Dock·e. t No.: B. CD-CV-13-40 ~ J) --::_~ uJ'r' / ~~~~ J.ol))

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PORTLAND PIRATES, LLC, )

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Plalntlrr-.---······--····---r------- ·· -··------·--·-------·····-·-·-----·-··------·-··-------·-···-·-------------··----· )

v. )

) DECISION AND ORDER CUMBERLAND COUNTY ) (Motion to Dismiss) RECREATION CENTER a/k/a ) CUMBERLAND COUNTY CIVIC ) CENTER, )

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Defendant )

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Defendant Cumberland County Recreation Cente1· alkiPJ Cumberland County Civlc Cente1· (DefondRnt o1· the Civic Center) moves, pursuant to M.R. Clv. P, 12(b)(6), to dismiss the complaint of Portland Plmtes, LLC (Plaintiff or the Pirates), which complaint asserts fmu· counts: breach of contract (Count I), breach of contrnct to negotiate in good faith (Count II), promissory estot>pel (Count Ill), and declaratory judgment (Count IV). The basis of the Civic Center's motion is that the resolution approved by the Civic Center's Board of Twstees dated April 17, 2013, is not a binding agreement and cannot serve as the foundation for any of the Pirates' c\nhns. Factual and Procedural Background

The following facts al'e dmwn from Plaintlffls Complaint and are presumed to be true for the pmposes of the motion. See Johnston v. Me. Ellergy Recovery Co., Ltd. P'sltip, 2010 ME 52, Y2,' 997 A.2d 741.

The Pimtes is a Delaware limited Jlability company nnd American Hockey League fmnchise affiliated wlth the Phoenix Coyotes a N"tion I H k L ' " n oc ey engue franchise based

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in Phoenix, Arizona. (Compl. Y11 1, 3 .) The Civic Center is a body corporate organized unde•· the laws of Maine that owns and operates the Cumberland County Civic Cente1· (CCCC), a mnllipurpose sports nnd entertainment venue in Portland. (Compl. ~~ 2, 4.) The CCCC is

currently undergoing renovation. (Compl. Y7 .) The Pirates have been the prime tenant at the - ------------------cccc-sTnce-T993: ccoJ:iiiJL-fS.) -------------------

In the six months prior to April 2013, the Ph·ates and the Civic Cente•· conducted extensive negotiAtions over the material terms of a long-term lease agreement. (Com pl.~ I0.) In April 2013. the pnrties met and agreed upon the material terms of the pnrties' agreement.

(Com pl. ~ 11.) At the April 17, 2013, Board Meeting, the Civic Center Trustees voted to approve all of the material terms of n long-term lease agreement with the Pirates. (Comp. ~ 13.)

There 111'0 at least 17 material terms within the resolution, including the length of the lease, nnnunl base rent per game, and the division of t·evenue between the parties for ticket sales.

advertisement, and concession sales, including alcohol. (Compl. ~~ 12-13.) With respect to advertising and concession sales, the agreement contemplated that the Pirates would receive I) 57.5% of the revenue from the sale of food and beverages, including nlcohol, for Its gumes;

and 2) 50% of revenue for above ice advertising. (Compl. Y12.) The Civic Cente•· ng•·eed that it would negotiate in good faith with the Pirates on a final agreement that would in.clude the agreed upon material terms. (Compl.' 14.)

On Muy 14,2013, the Civic Center provided a draft of the agreement that did not Include all of the agreed upon material terms, most notably provisions regarding the division of revenue for advertising and concession sales of alcohol. (Compl.' 15.) On June 17,2013, the Civic Center told the Pirates for the first time thnt state law prohibited the Pirates from t•eceiving revenue from the sale of alcohol and thus the Pirates could not receive that revenue. (Compl.

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Y17 .) In agreeing to share revenue from the sale of alcohol sold at hockey games the Civic Center represented that they had the authority to share the revenue with the Pirates. (Compl.

~ 18.)

On or about June 26, 2013, the Civic Center, acting in bad faith and in continued breach

of revenue from the sale of non-alcoholic food and beventges only, rather than 57.5% of both food nnd all bevemges, including alcohol; and 2) no t'evenue from above ice advertising.

(Com pl. ' ' 19, 21.) On August 27, 2013, the Civic Center sent the Pirates an ultimatum demanding that the team nccept the Civic Center's unilateral changes to the previously agreed upon material terms by 5:00 p.m. on August 29, 2013, or the Civic Center would presume that Pirates were relocating nnd undertake event planning fot· the dates previously reserved for hockey. (Compl.' 22.) On August 29, 2013, the Civic Center stated publicly that it had no ngreement with the Pirates. (Compl. Y23 .)

The Pirates filed their Complaint in Cumberland County Superior Court on September 6, 2013,tllong with a motion fol' a temporary restraining order. In Its Complaint, the Pirates assert th11t "[t]he Portland Pirates nnd the Civic Centet· mutually agreed and mutually expressed consent to be bound by the material terms reflected in the vote taken by the Civic Center Trustees on

April 17, 2013" nnd "[t}he material terms of their agreement were sufficiently definite to be u

" enforceable." (Com pi, Y~ 25-26.)

The mntter was approved for transfer to the Business and Consumer Court on September 9, 2013, and the Pirates withdrew its motion for a temporary restJ·aining on September'27, 2013.

The Civic Center filed the present motion on October 8, 2013.

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Dlsc\Jsslon A motion to dismiss pmsuant to M.R. Civ. P. 12(b)(6) "tests the legal sufficiency of the complaint and, on such a challenge, the material nllegations of the complaint must be taken as admitted." Shaw v. S. Aroostook Cmty. Sc/1. Dlst., 683 A.2d 502, 503 (Me. 1996) (quotation

determine whether it sets forth elements of a cause of action or alleges facts that would entitle the plaintiff to relief pursuant to some legal theory."' Ramsey v. Baxter Title Co., 2012MB 113, ~ 6, 54 A.3d 710 (quoting McCormick"· Crane, 2012MB 20, ~ 5, 37 A.3d 295). "The purpose of a complaint In modem notice pleading practice is to provide defendants with fair notice of the claim agninst them." Shaw, 683 A.2d at 503 (quotation marks omitted). "A complnlnt is properly dismissed when it is beyond doubt that the plaintiff is entitled to no relief under any set of facts that might be pi'Oven in support of the clnim." Richardson v. Willfhrop Sch. Dep't, 2009 MB 109, Y5, 983 A.2d 400 (quotation marks omitted).

Here, the Civic Center maintains that In the Complaint, the Plmtes have failed to assert nn actionable claim for breach of contract.

Pmsnant to Maine contract law, an agreement is legally binding if the parties "mutunlly assented to be bound by all Its materlnl terms; the assent [was]

manifested In the contr11ct, either expressly o1· Impliedly; and the contmct [was]

sufficiently definite to enable the court to determine its exact meaning and fix exactly the legal liabilities of the parlies,"

Barr v. Dyke, 2012 MB 108, ~ 13, 49 A.3d 1280, 1286 (quoting Sranto11 v. Univ. of Me. Sys., 2001 ME 96,9 13,773 A.2d 1045).

As referenced 11bove, In Count I of tho Complaint, Plaintiff has alleged that "ltlhe Portland Pirates and the Civic Center mutually agreed and mutually expressed consent to be bound by the material terms reflected in the vote taken by the Civic Center Trustees on April 17,

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20 I3" and "lt]he material terms of their agreement were sufficiently definite to be enforceable."

(Compl. ~~ 25-26.) In addition, Plaintiff also set forth in its Complaiitt the specific "material terms" that were the subject of the April 17,2013, vote of the Trustees. (Compl. ~ 13.) Plaintiff thus asserted that the parties agreed upon the material terms. of a binding agreement, which greemenrPia!ntiff-alleges-Defendmlt-lnts-breadre<l:--(eompl-:-'y-z?:;28;)1hese-alle-gatfons, when "viewed 'in the light most favorable to the plaintiff ... [set] forth elements of a cause of action ol' alleges facts that would entitle the plal~tiff to relief pursuant to some legal theory."'

Ramsey v. Baxter Title Co., 2012 ME 113, ~ 6, 54 A.3d 710 (quoting McCormick v. Crane, 2012 ME 20,9 5, 37 A.3d 295); see also Stallion, 2001 ME 96, 3J 13,773 A.2d 1045.

The Civic Center nevertheless maintains that the Court should dismiss the Complaint because the agreement upon which Plaintiff relies does not satisfy the statute of frnuds and is thus unenfo1·ceable. See 33 M.R.S. §51 (2012). The statute of frauds fs au affirmative defense.

M.R. Civ. P. 8(c). A party can raise an affirmative defense by a motion to dismiss if the facts giving rise to the motion are appnrent on the face of the complaint. Gray v. T~D. Bank. N.A., 2012 ME 83, ~ 10, 45 A.3d 735. Whether a written agreement is necessary under the circumstances of this case and, if so, whether a writing that satisfies the statute of frauds exists are questions that the Court cannot determine at this stage of the proceedings. In othet' words,

the applicability of the statute of frauds to preclude enforcement of the alleged agreement is not u

" apparent on the face of the Complaint.• In Count III of the Complaint, the Pirates assert a claim for promissory estoppel. In Daigle Commercial Gro11p, l11c. v. St. Laurellt, the Law Court reiterated that Maine has adopted the Restntement formulation of promissory estoppel:

1 rn Count II of the Complaint, Plnlnllff alleges the brench of contraot to negotiate In good faith. Tho Court's analysis regarding Count I of tho Complnlnt Is equally applicable to Count II.

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A promise which the promisor should J'easonably expect to induce action or forbenrance on the part of the promisee or a third person and which does induce such action or forbearance is binding if injustice cnn be avoided only by enforcement of the promise. The remedy granted for breach may be limited 11s justice requires.

1999 ME 107,' 14, 734 A.2d 667 (cltlng Panasonic Commc'ns & .sys. Co. v. State of Me., I 997 -~----ME-43,-9-l7-r691-A.2d~l90rand·RBsTA1'EMBN:r.(SEGOND)OP-G0N'l'RAeT-S·§·90fl·){l98·1)),....,------~ In this case, the Plrntes allege that the Civic Centel' "promised that it would honor the material terms voted upon 1111d approved at the April 17, 2013 Board Meeting, and furthe•· promised that it would negotinte in good faith with the . . . Pirates on the terms of the agreement"; "[t]he Civic Center should have rensonnbly expected its promise to induce the ...

Pirates to·mllke all necessary business armngements to play hockey at the ICCCC]"; nnd the "Pimtes in fact did mly on the Civic Center's promises." (Compl. 9Y 36, 37, 38.) The Pirates have thus nsserted the elements necessary to state a cause of action in promissory estoppel under Maine law.

Conclusion

Based on the foregoing analysis, the Court denies Defendant's Motion to Dlsmiss.2 Pursuant to M.R. Civ. P. 79(a), the Clerk shall inco•·porate this Order into the docket by reference.

z In Count IV of the Complaint, Plaintiff "seek(s] n declnralion that there exists n binding agreement between II and [Defendant]." (Compl. 1!42) Whether the parties entered Into n binding agreement Is a centrnllssuo in dispute In this case. Although Plainllffhas asserted n cause of action for breach of contract, Plaintiff nevertheless will have to establish tho ex lstence of n binding agreement. P!aintlrrs request in Count IV, therefore, is consistent with Plainlitrs clnlms In Counts 1 nnd II. Accordingly, dlsmlssnl of Count IV Is not warranted.

Portland Pirates, LLC v. Cumberland County Recreation Center alkla Cumberland County Civic Center BCD-CV-13-40

Portland Pirates, LLC Petitioners I Plaintiffs

Counsel: Harold Friedman, Esq.

Verrill Dana LLP

One Portland Square

P.O. Box 586

Portland, ME 04112

Cumberland County Recreation Center alkla Cumberland County Civic Center Respondents I Defendants

Counsel: David Barry, Esq.

Pierce Attwood

Merrill's Warf

2 54 Commercial Street

Portland, ME 04101