Opinion
Index No. 611041/2019 Motion Seq. No. 002-MG
12-22-2020
JRC BEVERAGE, INC., d/b/a S.K.I. BEER, Plaintiff, v. K.P. GLOBAL, INC. and NORTHERN BEVERAGE, INC., Defendants.
SCHWARTZ ETTENGER, PLLC Attorneys for the Plaintiff. LAW OFFICE OF KIM &CHA, LLP Co- Counsel for the Defendants VISHNICK, MCGOVERN, MILIZIO, LLP Co-Counsel for the Defendants.
Unpublished Opinion
SCHWARTZ ETTENGER, PLLC Attorneys for the Plaintiff.
LAW OFFICE OF KIM &CHA, LLP Co- Counsel for the Defendants
VISHNICK, MCGOVERN, MILIZIO, LLP Co-Counsel for the Defendants.
PRESENT: HON. JAMES HUDSON, Acting Justice.
HON. JAMES HUDSON, Acting Justice.
The motion (seq. no.:002) by the Defendants, K.P. Global, Inc. and Northern Beverage, Inc. ("Defendants") requests an order granting the Defendants summary judgment pursuant to CPLR Rule 3212; and dismissing the Verified Complaint.
The cross-motion (seq. no.:003) by the Plaintiff requests an order granting the Plaintiff summary judgment pursuant to CPLR Rule 3212; and denying the relief requested in the Defendants' motion (seq. no.:002).
This is an Action sounding in an alleged violation of the Alcoholic Beverage Control Law ("ABCL") as it applies to agreements between beer brewers and beer wholesalers and rights of distribution. The Plaintiff, JRC Beverage, Inc. ("JRC"), states that is a New York beer wholesaler, doing business as beer distributor S.K.I. Beer ("SKI"). The Plaintiff alleges that during 2015 it was appointed by BWS Group Co. ("BWS") as the exclusive New York State brand agent and wholesale distributor of certain South Korean beers manufactured by the Oriental Brewery Co., ("OBC"), known as OB Beers ("OB"). The Plaintiff seeks a declaratory judgment that it is the exclusive distributor of OB Beer brands in New York State, and injunctive relief prohibiting Defendant K.P. Global, Inc. ("K.P.") from terminating the Plaintiffs exclusive distributorship. The Plaintiff seeks a permanent injunction against K.P. granting OB distributorship rights until K.P. complies with the provisions of ABCL §55-c, as that statute applies to the Plaintiff. The Plaintiff demands a finding that Defendant Northern Beverage, Inc. ("Northern") has tortiously interfered with the Plaintiffs exclusive distributorship by contracting with K.P. to distribute OB beers in New York State. The Plaintiff also seeks monetary damages and a determination of unfair competition.
"Summary judgment is a drastic remedy and should not be granted where there is any doubt as to the existence of a triable issue of fact" (Trio Asbestos Removal Corp. v. Gabriel & Sciacca Certified Public Accountants, LLP, 164 A.D.3d 864, 865, 82 N.Y.S.3d 127, 129 [2d Dept 2018]; see Ugarriza v. Schneider, 46 N.Y.2d 471, 414 N.Y.S.2d 304, 386 N.E.2d 1324 [1979]; Rotuba Extruders v. Ceppos, 46 N.Y.2d 223, 413 N.Y.S.2d 141, 385 N.E.2d 1068 [1978]; Castlepoint Ins. Co. v. Command Sec. Corp., 144 A.D.3d 731, 42 N.Y.S.2d 30 [2d Dept 2013]). The Supreme Court's function on a motion for summary judgment is issue finding, not issue determination (Trio Asbestos, supra, at 865,129; see Sillman v. Twentieth Century Fox Film Corp., 3 N.Y.2d 395,404, 165 N.Y.S.2d 498, 14 N.E.2d 387 [1957]; Suffolk County Dept, of Social Services on Behalf of Michael v. and James M., 83 N.Y.2d 178,608 N.Y.S.2d 940,630 N.E.2d 636 [ 1994]; Matter of Corfian Enters., Ltd., 52 A.D.3d 828, 829, 861 N.Y.S.2d 392 [2d Dept 2008]). "...a party does not carry its burden in moving forward for summary judgment by pointing to gaps in its opponent's proof, but must affirmatively demonstrate the merit of its claim or defense" (Red River Learning Center, LLC v. ADL Data Systems, Inc., 98 A.D.3d 724, 725-726, 950 N.Y.S.2d 179, 181 [2d Dept 2012]). When a party seeks summary judgment it must affirmatively establish its entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issue of fact (see Voss v. Netherlands Insurance Co., 22 N.Y.3d 728,98 N.Y.S.2d 448, 8 N.E.3d 828 [2014]; Vega v. Restani Construction Corp., 18 N.Y.3d 499, 943 N.Y.S.2d 13, 965 NE3d 240 [2012]; Yun Tung Chow v. Reckitt & Coleman, Inc., 17 N.Y.3d 29, 926 N.Y.S.2d 377, 950 N.E.2d 113 [2011]). A movant's failure to make a prima facie showing of entitlement to summary judgment requires the denial of the motion regardless of the sufficiency of the opposing papers (Winegrad v. New York University Medical Ctr., 64 N.Y.2d 851, 487 N.Y.S.2d 316, 476 N.E.2d 632 [1985]). When the moving party "...has demonstrated its entitlement to summary judgment, the party opposing the motion must demonstrate by admissible evidence the existence of a factual issue requiring a trial of the action or tender an acceptable excuse for his failure to do so" (Zuckerman v. City of New York, 49 N.Y.2d 557, 560, 427 N.Y.S.2d 595, 404 N.E.2d 718 [1980]). In considering a motion for summary judgment, the party opposing the motion must be afforded "every inference which may properly be drawn from the facts presented, and the facts must be considered in a light most favorable to the non-movant" (Hand v. Field, 15 A.D.3d 542, 543, 790 N.Y.S.2d 681 [2d Dept 2005]; quoting Szczerbiak v. Pilot, 90 N.Y.2d 553, 556, 664 N.Y.S.2d 252, 686 N.E.2d 1346 [1997]).
ABCL §55-c. Agreements between brewers and beer wholesalers.
1. Purpose. It is hereby declared to be the policy of this state, that the sale and delivery of beer by brewers to beer wholesalers shall be pursuant to written agreement...
2. Definitions. As used in this section, the following words shall have the following meanings:
(a) "Agreement" means any contract, agreement, arrangement, course of dealing or commercial relationship between a brewer and a beer wholesaler pursuant to which a beer wholesaler is granted the right to purchase, offer for sale, resell, warehouse or physically deliver beer sold by a brewer.
(b) "Brewer" means any person or entity engaged primarily in business as a brewer, manufacturer of alcoholic beverages, importer, marketer, broker or agent of any of the foregoing who sells or offers to sell beer to a beer wholesaler in this state or any successor to a brewer.
(c) "Successor to a brewer" means any person or entity which acquires the business or beer brands of a brewer, without limitation, by way of the purchase, assignment, transfer, lease, or license or disposition of all or a portion of the assets, business or equity of a brewer in any transaction...
Plaintiff JRC alleges that its status and attendant rights as the exclusive brand agent and wholesale distributor of OB beers were established by an October 28th, 2015 Appointment Letter ("Letter") between non-party BWS Group Co. ("BWS") and the Plaintiff (Documents 18, 50). In the instant case the Plaintiff identifies and refers to itself as SKI. The Letter on its face appears compliant with the statutory definition of an "Agreement" pursuant to the Alcohol and Beverage Control Law (ABCL §55-c[2] [a]). BWS Group Co. appears to meet the ABCL statutory definition of a "Brewer" (ABCL §55-c[2][b]). That Letter, sub-titled "Appointment of Distributor" states that BWS Group Co. distributes [South Korean] OB Premier and CASS beer and closes by stating: "This appointment [of JRC as Distributor] is effective as of 08/27/2015 and terminates on 06/30/2016." The Letter contains no provision for an extension of the distributorship. The Plaintiff has not filed any New York Department of State document which indicates that SKI is the d/b/a for JRC. Neither the Plaintiff nor Defendants have alleged or filed any document demonstrating privity of contract between BWS and Defendant KP, the alleged "Successor to a Brewer" (ABCL §55-c[2] [c]). Neither Plaintiff nor Defendants have filed any documents demonstrating privity of contract between Plaintiff JRC/SKI and either of the Defendants, KP or Northern.
In their instant motion for summary judgment, (seq. no.:002), the Defendants allege that they are not Successor Brewers to the non-party BWS. The Defendants note that the subject Appointment Letter is between a non-party and JRC, which distributorship terminated on June 30th, 2016. Mr. Ralph Mauriello, JRC President, states in paragraph VI of his Affidavit (Document 51) that "...there is no written wholesaler agreement between BWS and SKI [JRC]."
ABCL §55-c specifies that "...the sale and delivery of beer by brewers to beer wholesalers shall be pursuant to a written agreement" (ABCL §55-c[l]). The statute provides an expansive definition of an "Agreement"(ABCL §55-c[2][a|), which terms "arrangement" and "course of dealing" may apply to the BWS/JRC distributorship. The statute contains no provision for continuation of an expired written agreement or appointment. "The 'literal language of a statute' is generally controlling unless 'the plain intent and purpose of a statute would otherwise be defeated' [Bright Homes, Inc. v. Wright, 8 N.Y.2d 157, 161-162, 203 N.Y.S.2d 67, 168 N.E.2d 515 (I960)]... A statute 'must be construed as a whole' and 'its various sections must be considered together and with reference to each other' [People v. Mobil Oil Corp., 48 N.Y.2d 192, 199, 422 N.Y.S.2d 33, 397 N.E.2d 724 (1979)]". (Anonymous v. Molik, 32 N.Y.3d 30, 37, 84 N.Y.S.3d 414, 419, 109 NE3d 563, 568 [2018]). "Where the language of a statute is clear and unambiguous, courts must give effect to its plain meaning" (State of New York v. Patricia II, 6 N.Y.3d 160, 162, 811 N.Y.S.2d 289, 844 N.E.2d 743 [2006]).
No document has been filed which states that KP is a successor to BWS. The Defendants have filed an April 25th, 2018 letter from the Oriental Brewery Company, which discusses the termination of BWS Group, Inc. as the distributor of its beers in the United States (Document 44). The Defendants have also filed a document dated January 8th, 2019, entitled "Authorized Letter of Appointment" for OB-branded beers as Document 17. That 2019 Letter states that the South Korean brewer Oriental Brewery Company (OBC) appoints "K.P. Global Inc. (KP) as our official distributor for the U.S.A..
No one can do commercial activity with our brand Cass Fresh, Light and OB Premier without this authorized letter from OBC. In addition, Only [sp] officialy [sp] authorized distributor is allowed to designate wholesalers on behalf of OBC."
The March 1st, 2019 Distribution Agreement between KP and Northern and the related March 14th, 2019 Letter of Appointment by KP of Northern as its New York brand agent for OB beers are filed as Document 44. The Plaintiff has not named OBC or BWS as Defendants. It is noted that the Plaintiffs beer distributorship at the core of this action expired Two (2) years, Seven (7) months prior to the appointment of Defendant KP as the distributor of OBC beers.
The Plaintiff, in its cross-motion for summary judgment (seq. no.:003), contends that the 2015 Letter grants Plaintiff an ongoing, viable distributorship. The Plaintiff does not address the 2016 termination of its distributorship. The Plaintiff alleges that its distributorship was improperly terminated by the Defendants undertaking exclusive distribution of OB beers during 2019. The Plaintiff has filed no document to justify its reliance that its distributorship continued beyond the June 30th, 2016 termination date. The Plaintiff alleges that the provisions of ABCL §55-c links their 2015 Appointment Letter to the 2019 beer distributorship held by Defendant KP and its agent, Defendant Northern. The Plaintiff contends that the Defendants are Successor Brewers to itself pursuant to ABCL §55-c(2)(c); and are responsible by the terms of that Statute for the improper termination of Plaintiffs OB beer distributorship.
The Plaintiff has not cited to any statute or caselaw in support of its contention that ABCL §55-c applies to beer distribution appointments which continue after a stated termination date. The Plaintiff has also not cited either statute nor caselaw in support of its contention that successor liability exists where there is no privity of contract nor continuity of business. The Plaintiff has made no argument to justify its reliance on its contention that it held an on-going distributorship for OB branded beers.
Filed case documents demonstrate that OBC terminated its distributorship with BWS during 2018. Case documents clearly show that OBC appointed KP as its U.S. distributor during 2019. The Plaintiff has filed no documents to support its contention that KP acquired its distribution rights from BWS.
"Conclusory allegations, even if believable, are insufficient to defeat summary judgment [Amatulli v. Dehli Construction Corp., 77 N.Y.2d 525, 533, 569 N.Y.S.2d 337, 571 N.E.2d 645; McGahee v. Kennedy, 48 N.Y.2d 832, 834, 424 N.Y.S.2d 343,400 N.E.2d 285]" (South End Distributing Corp. v. Hornell Brewing Co., Inc., 179 Misc.2d 576, 583, 685 N.Y.S.2d 594, 599 [Sup Ct Kings Cty 1999]).
Mere assertions or conclusory statements do not constitute a prima facie showing. Evidence in admissible form is required (see Buckley v. Rockefeller Group, Inc., 143 A.D.2d 623, 533 N.Y.S.2d 8 [2d Dept 1988]).
The Plaintiff, through its cross-motion (seq. no.:003), has not affirmatively established its entitlement to summary judgment as a matter of law. The Plaintiff has not tendered sufficient evidence that KP is Plaintiff s Successor to a Brewer pursuant to ABCL §55-c(2)(c), thereby demonstrating the absence of any material issue of fact (see Voss supra.', Vega supra.', Yun Tung Chow, supra.).
When the movant fails to make a prima facie showing of entitlement to judgment as a matter of law, summary judgment is denied and the court need not examine the sufficiency of the opposition papers (Perry-Renwick v. Giovanni Macchia Landscaping & Gardening, Inc., 136 A.D.3d 772, 26 N.Y.S.3d 91 [2d Dept 2016]).
Were the Plaintiff dissatisfied with the terms of the 2015 BWS beer distributorship appointment, the Plaintiff need only have refused to accept and to enter into that business relationship. The Plaintiff, an experienced business entity with access to the benefit of counsel, accepted the risk and entered into the distributorship with BWS upon the terms of the October 28th, 2015 Appointment Letter. (Documents 18, 50).
A party seeking summary judgment must make a prima facie showing of entitlement to judgment as a matter of law, offering sufficient evidence to demonstrate the absence of any material issue of fact (Ciccone v. Bedford Cent. School Disk, 2 1 A.D.3d 437, 800 N.Y.S.2d 452, leave to appeal den., 6 N.Y.3d 702, 810 N.Y.S.2d 416, 843 N.E.2d 1156 [2005]). Summary judgment may only be granted when it is clear that no triable issue of fact exists (Capitol Records, LLC v. Harrison Greenwich, LLC, 44 Misc.3d 2020,984 N.Y.S.2d 274 [Sup Ct New York Cty 2014]).
In the case at bar, the documents speak for themselves and the relationship is governed by written agreements (Weg v. Kaufman, 159 A.D.3d 774, 72 N.Y.S.3d 135 [2d Dept 2018]; see Vermont Teddy Bear Co., Inc. v. 538 Madison Realty Co., 1 N.Y.3d 470,775 N.Y.S.2d 765, 807 N.E.2d 876 [2004]; First Nat. City Bank v. State, 72 A.D.2d 762, 421 N.Y.S.2d 381 [2d Dpet 1979]). The execution of an agreement triggers a presumption that the signors understood the contents of the instrument British West Indies Guar. Trust Co., Ltd. v. Banque Internationale a Luxembourg, 172 A.D.2d 234, 567 N.Y.S.2d 731 [1st Dept 1991]). "...as signatories [the parties] are presumed to know the contents of the instrument [which they] signed and to have assented to such terms." (Id.). "It is axiomatic that in the absence of any ambiguity, we look solely to the language used by the parties.." (Vermont Teddy Bear, supra, at 475).
The Defendants, in their motion (seq. no.:002) have demonstrated the absence of material fact that they are responsible to the Plaintiff pursuant to ABCL §55-c with regard to their distribution of OB beers. The Defendants have shown by documentary evidence that K.P. Global, Inc. is not a successor brewer to the Plaintiff pursuant to ABCL §55-c(2)(c). The Defendants have filed documents which demonstrate that the appointment of Northern Beverage, Inc. by KP as their New York distribution agent is not subject to the terminated distributorship formerly held by the Plaintiff. The Plaintiff, in its opposition to the Defendants' motion has failed to "...raise genuine factual issues" (JP Morgan Chase Bank. N.A. v. Galt Group, Inc., 84 A.D.3d 1028, 1029, 923 N.Y.S.2d 643 [2d Dept 2011]; quoting Badische Bank v. Ronel Systems, Inc., 36 A.D.2d 763, 321 N.Y.S.2d 320 [2d Dept 1971]; see Leumi Fin. Corp. v. Rickter, 24 A.D.2d 855, 264 N.Y.S.2d 707, aff'd 17 N.Y.2d 166, 269 N.Y.S.2d 409, 216 N.E.2d 579 [1965]; Stagg Tool & Die Corp. v. Weisman, 12 A.D.2d 99,208 N.Y.S.2d 585 [1st Dept I960]).
Accordingly, it is
ORDERED, that the motion (seq. no.:002) by the Defendants which requests an Order pursuant to CPLR Rule 3212, granting the Defendants summary judgment against the Plaintiff is granted; and it is further
ORDERED, that Defendants' request that the Verified Complaint be dismissed, is granted; and it is further
ORDERED, that the cross-motion (seq. no.:003) by the Plaintiff which requests an order pursuant to CPLR Rule 3212, granting the Plaintiff summary judgment against the Defendants is denied.
This Memorandum also constitutes the Order of Court.