Rohm & Haas Electronic Materials, LLC v. Electronic Circuits Supplies, Inc.

759 F. Supp. 2d 110, 2010 U.S. Dist. LEXIS 136080, 2010 WL 5485824
CourtDistrict Court, D. Massachusetts
DecidedDecember 22, 2010
DocketCivil Action 10-10563-JLT
StatusPublished
Cited by50 cases

This text of 759 F. Supp. 2d 110 (Rohm & Haas Electronic Materials, LLC v. Electronic Circuits Supplies, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Massachusetts primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rohm & Haas Electronic Materials, LLC v. Electronic Circuits Supplies, Inc., 759 F. Supp. 2d 110, 2010 U.S. Dist. LEXIS 136080, 2010 WL 5485824 (D. Mass. 2010).

Opinion

MEMORANDUM

TAURO, District Judge.

I. Introduction

Rohm and Haas Electronic Materials, LLC (“Plaintiff’) asserts that Electronic Circuits Supplies, Inc. (“Defendant”), a former distributor of one of Plaintiffs goods, committed fraud and deceit by deleting a material term in a prior non-competition provision while the Parties were amending another portion of their distributorship agreement. Plaintiff also claims that Defendant is misappropriating Plaintiffs goodwill and confidential information by breaching the Parties’ agreement. Presently at issue is Plaintiffs Motion for Preliminary Injunction [# 3]. Plaintiff seeks to enjoin Defendant and its agents, representatives or other persons authorized to speak or act on Defendant’s *114 behalf from selling the same, similar, or competitive products to Plaintiffs customers for one year. For the following reasons, Plaintiffs Motion for Preliminary Injunction is DENIED.

II. Background

Most of the material facts are undisputed. 1 Plaintiff manufactures and distributes electronic products that are used in manufacturing printed circuit boards. 2 Prior to December 31, 2007, Plaintiff sold some of its products directly to customers and also used a netwox-k of exclusive distributors. 3 Plaintiffs network of distributors is responsible for maintaining direct relationships with customers by providing logistical and technical support to the customers. The distributors purchase products from Plaintiff and sell the products to customers. 4 Plaintiff has around 15,000 employees and generated sales nearing nine billion dollars in 2007. 5 Plaintiff is a subsidiary of Dow Chemicals, and Dow has 46,000 employees and generates annual sales around fifty billion dollars per year. 6

Since 1991, Defendant has had a network of customers in the Mid-Atlantic and New England regions on behalf of chemical manufacturers, including those creating chemicals for use in circuit boards and chemical milling industries. 7 Defendant has five employees, including its President and co-owner. 8 Defendant generates around four million dollars in revenue per year. 9 Defendant was Plaintiffs distributor for certain customer accounts. 10

A. The Parties ’ Agreement

Plaintiff entered into an Amended and Restated Distributor Agreement (“Agreement”) with Defendant, which made Defendant the exclusive distributor of Plaintiffs products in a specific territory that included New Jersey, New York, Pennsylvania, and Virginia (“Territory”). 11 Massa *115 chusetts law governed the Agreement. 12

In the Agreement, Defendant agreed not to sell products that competed with Plaintiffs products during the period of the Agreement and for twelve months following its termination. 13 Additionally, Defendant would not be allowed to sell competitive products as long as Defendant violated its non-competition obligations and for any period required for litigation to enforce these obligations. 14

The Agreement also required Defendant to agree that goodwill accrued solely to Plaintiff and that Plaintiff owned all rights, title, and interest to its products. 15 Additionally, Plaintiff retained ownership of all trade secrets and Defendant agreed not to disclose any “confidential information” without Plaintiffs prior written approval. 16 Moreover, during the time period of the Agreement, Defendant was not allowed to market, promote, or sell similar or competitive products within the Territory. 17

B. The Amendment to the Agreement and the Disputed Facts

Plaintiff became dissatisfied with Defendant’s performance and sought an amendment to the Agreement to remove a number of customer accounts from Defendant’s purview. 18 Hal Thrasher, Plaintiffs Director of Sales for North and South America, 19 notified Martin Georgia, the President and co-owner of Defendant, 20 of this decision and promised to send him a proposed amendment to the Agreement for his review. 21 Thrasher and Georgia did not discuss any further details of the amendment. 22 Thrasher e-mailed Georgia an electronic document that was a draft letter amending the Agreement. 23 Georgia inserted language into the document that removed the non-competition provision 24 *116 and sent at least one signed version back to Thrasher (“Amendment”). 25 Georgia expected Plaintiff and its legal staff to read the two-page document and did not explicitly inform Plaintiff of the insertion. 26 Plaintiff counter-signed without knowledge that Georgia had made the changes and in reliance on the instructions that Plaintiff provided to Defendant. 27

The Parties dispute the exact instructions provided by Plaintiff when Plaintiff sent the electronic document, and whether Defendant complied with those instructions. Plaintiff claims that Thrasher “advised” Georgia that if Georgia had any “proposed edits,” then he should “mark up the document” and send it back “electronically” so that Plaintiff could approve or reject the proposed changes. 28 If Georgia had no changes, he was “advised” to send two signed originals of the letter to Thrasher for Plaintiff to counter-sign. 29 Defendant, however, claims that it did as instructed. That is, Georgia inserted language into the electronic version of the proposed amendment removing the non-competition provision and mailed a signed version to Thrasher. 30

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
759 F. Supp. 2d 110, 2010 U.S. Dist. LEXIS 136080, 2010 WL 5485824, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rohm-haas-electronic-materials-llc-v-electronic-circuits-supplies-inc-mad-2010.