Showtime Game Brokers, Inc. v. Blockbuster Video, Inc.

151 F.R.D. 641, 1993 U.S. Dist. LEXIS 16163, 1993 WL 469242
CourtDistrict Court, S.D. Indiana
DecidedNovember 2, 1993
DocketNo. IP 93-628 C
StatusPublished
Cited by2 cases

This text of 151 F.R.D. 641 (Showtime Game Brokers, Inc. v. Blockbuster Video, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. Indiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Showtime Game Brokers, Inc. v. Blockbuster Video, Inc., 151 F.R.D. 641, 1993 U.S. Dist. LEXIS 16163, 1993 WL 469242 (S.D. Ind. 1993).

Opinion

ENTRY

BARKER, District Judge.

This motion comes before the Court upon Defendant Blockbuster Video, Inc.’s (“Blockbuster”) Motion To Dismiss Plaintiff Showtime Game Brokers, Inc.’s (“Showtime”) Complaint for failure to join Pacific Game Brokers, Inc., (“Pacific”) as a necessary and indispensable party. See Fed.R.Civ.Proc. 19. For the reasons set forth below, the Court denies Blockbuster’s Motion To Dismiss and orders Showtime to join Pacific as a necessary party to this action within forty-five (45) days of this Entry. The court also grants [644]*644Showtime leave to amend its Complaint in order to comply with the terms of this Entry.

BACKGROUND

Showtime, an Indiana Corporation, is a broker of movies, video games, and other related video products and acts as an intermediary between the retailers and the suppliers of such products. Blockbuster is a Florida Corporation which rents and sells movies and video products from retail outlets in several states, including Indiana. It places product orders with regional suppliers and brokers from its district and corporate headquarters for shipment to local stores. Around November, 1989, Blockbuster began ordering products from Pacific, a Washington corporation and broker of video products, though the latter did not directly supply Blockbuster’s local stores. Rather Pacific approached Showtime with an offer to share the commissions from its sales to Blockbuster in exchange for Showtime’s service of Blockbuster’s accounts within its region. Pacific entered into the agreement with Showtime around November, 1989,1 which provided that Blockbuster would establish an account in Showtime’s name, Showtime would supply the products, and both Showtime and Pacific would split the commission from those sales. See Amend. To Mem. In Opp’n To Def.’s Mot. To Dismiss Under Rule 12(b)(7), at 2 [hereinafter “Amended Memorandum”]. Furthermore, Showtime would send invoices for the product to Blockbuster’s district or corporate headquarters, and Blockbuster would pay Showtime, who would then pay Pacific its commission. See Br. In Supp. Of Blockbuster Videos, Inc.’s Mot. To Dismiss, at 1 [hereinafter “Def.’s Br. In Supp.”]. The invoices identified Showtime as the “supplier” with the product “sold by” Pacific. See Id. at Ex. A

This arrangement continued until approximately March, 1991, when Showtime alleges that Blockbuster began to pay Pacific directi ly without its consent or knowledge. See Amended Memorandum, at 2. The payments to Pacific continued through July, 1991; thereafter, Showtime received the payments directly from Blockbuster. According to Showtime, the invoices paid to Pacific totaled approximately $254,040.78. Id. at 3. Furthermore, Showtime contends that not until June, 1993, did Pacific begin to send invoices directly to Blockbuster; thus, the payments made to Pacific before that time were unjustified. Id. However, Showtime admits receiving from Pacific approximately $100,002.17 in commissions from the June-July sales to Blockbuster. Id.

Blockbuster claims that it approached both Pacific and Showtime in the early part of June, 1991, and notified them that a new electronic ordering and billing system was being implemented, making it necessary for both parties to use it. See Reply Br. In Supp. of Blockbuster Videos, Inc.’s Mot. To Dismiss, at 3-4 [hereinafter “Def.’s Reply Br.”]. Nonetheless, only Pacific complied with Blockbuster’s request, and therefore it, and not Showtime, received the payments. Id.

Showtime demanded that Blockbuster pay all of the $254,040.78 due on the invoices. Blockbuster refused to pay because it had already paid those invoices to Pacific. Showtime then filed suit in Indiana on April 20, 1993, to recover the amounts due on the invoices. See Complaint, at 4. In its Complaint, Showtime alleges that Blockbuster entered into a contract for the sale of goods with Showtime and that Blockbuster breached the contract by not paying for the goods. Id. at 2-3. Furthermore, Showtime seeks recovery of all amounts due by Blockbuster on Showtime’s accounts. Id. at 4.

Blockbuster removed the action to this Court on May 13,1993, pursuant to 28 U.S.C. § 1441 et seq. and then filed its motion to dismiss on July 1, 1993, alleging that under Rule 12(b)(7), Showtime failed to join a necessary party under Rule 19. See Def.’s Mot. to Dismiss. Blockbuster claims that under the tests set forth in Rule 19(a) and (b) of the Federal Rules of Civil Procedure, Pacific is [645]*645an indispensable party to this action; thus, Showtime’s failure to join Pacific is grounds for dismissal under Rule 12(b)(7). See Def.’s Br. In Supp., at 9.

DISCUSSION

Rule 12(b)(7) allows a plaintiff to move for dismissal of an action where the defendant has failed “to join a party under Rule 19.” Fed.R.Civ.Proc. 12(b)(7). Rule 19, in relevant part, states:

(a) Persons to be Joined if Feasible. A person who is subject to service of process and whose joinder will not deprive the court of jurisdiction over the subject matter of the action shall be joined as a party in the action if (1) in the person’s absence complete relief cannot be accorded among those already parties, or (2) the person claims an interest relating to the subject of the action and is so situated that the disposition of the action in the person’s absence may (i) as a practical matter impair or impede the person’s ability to protect that interest or (ii) leave any of the persons already parties subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations by reason of the claimed interest. If the person has not been so joined, the court shall order that the person be made a party----
(b) Determination by the Court Whenever Joinder is not Feasible. If a person as described in subdivision (a)(l)-(2) hereof cannot be made a party, the court shall determine whether in equity and good conscience the action should proceed among the parties before it, or should be dismissed, the absent person being thus regarded as indispensable. The factors to be considered by the court include: first, to what extent a judgment rendered in the person’s absence might be prejudicial to the person or those already parties; second, the extent to which, by protective provisions in the judgment, by the shaping of relief, or other measures, the prejudice can be lessened or avoided; third, whether a judgment rendered in the person’s absence will be adequate; fourth, whether the plaintiff will have an adequate remedy if the action is dismissed for nonjoinder.

Fed.R.Civ.Proc. 19(a)-(b).

Rule 19 involves a two-prong test to determine whether a party is to be joined: “[f]irst, is the absent party a person ‘to be joined if feasible’; and, second, if not feasible should the court in equity and good conscience allow the action to proceed or treat the absent party as indispensable.” Le Beau v. Libby-Owens-Ford Company, 484 F.2d 798, 800 (7th Cir.1973). In Le Beau, the Seventh Circuit outlined the analysis that a district court should follow under Rule 19:

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151 F.R.D. 641, 1993 U.S. Dist. LEXIS 16163, 1993 WL 469242, Counsel Stack Legal Research, https://law.counselstack.com/opinion/showtime-game-brokers-inc-v-blockbuster-video-inc-insd-1993.