Opinion
Case No. 3:21cv943-TKW-ZCB
2023-03-02
US IRON FLA, LLC, Plaintiff, v. GMA GARNETT (USA) CORP., Defendant.
Michael Jonathan Henry, Christine Elizabeth Sutherlin, Michael Patrick Dickey, Gary Allen Shipman, Dunlap & Shipman PA, Santa Rosa Beach, FL, for Plaintiff. Angelina Maria Gonzalez, Harold Steven Vogel, Jr., Dickinson Wright PLLC, Fort Lauderdale, FL, Vijay Gibran Brijbasi, Weston, FL, for Defendant.
Michael Jonathan Henry, Christine Elizabeth Sutherlin, Michael Patrick Dickey, Gary Allen Shipman, Dunlap & Shipman PA, Santa Rosa Beach, FL, for Plaintiff. Angelina Maria Gonzalez, Harold Steven Vogel, Jr., Dickinson Wright PLLC, Fort Lauderdale, FL, Vijay Gibran Brijbasi, Weston, FL, for Defendant. ORDER ON MOTIONS FOR SUMMARY JUDGMENT T. KENT WETHERELL, II, UNITED STATES DISTRICT JUDGE
This case is before the Court based on Plaintiff's motion for partial summary judgment (Doc. 60) and Defendant's motion for summary judgment (Doc. 63). Upon due consideration of the motions, the responses in opposition (Docs. 79, 81), the replies (Docs. 83, 86), and the evidence submitted with those filings, the Court finds that the motions are due to be denied except with respect to Plaintiff's unjust enrichment claim and claim for lost profits.
I. Overview
This is a breach of contract case. Plaintiff claims that it contracted with Defendant to purchase a quantity of ilmenite and that Defendant repudiated the contract by refusing to sell the ilmenite to Plaintiff unless Plaintiff agreed to an added condition—that it not re-sell the ilmenite to a Chinese buyer. Defendant claims, however, that the parties did not have an enforceable contract, and even if they did, Plaintiff cannot establish that Defendant breached the contract or that it suffered any damages (particularly lost profits) resulting from the alleged breach. Plaintiff also claims that Defendant was unjustly enriched by knowing that the ilmenite was marketable based on Plaintiff's testing and being able to use that information to sell the ilmenite to a different buyer. But Defendant argues that the claim fails as a matter of law because Plaintiff tested the ilmenite for its own benefit, not Defendant's.
Ilmenite is a titanium-iron oxide mineral that is used to produce titanium and is the primary source of titanium dioxide that is used in a variety of consumer products.
Despite the parties' cross-motions for summary judgment on several aspects of the breach of contract claim, the Court finds that there are disputed issues of material fact that preclude summary judgment in favor of either party. However, with respect to Plaintiff's claims for lost profits and unjust enrichment, the Court finds that the material facts are not in dispute and that Defendant is entitled to summary judgment on those claims.
II. Facts
The parties are engaged in the mineral sales industry. Defendant is a subsidiary of an Australian company that specializes in processing ore to extract garnet. Ilmenite is a byproduct of garnet processing, and Plaintiff is in the business of procuring minerals like ilmenite for resale.
Conversations between the parties about a potential sale of ilmenite began in 2019 when Plaintiff's principal, Mark Miller, received a "cold call" from Brianna Hanson asking if Plaintiff would be interested in purchasing ilmenite from Defendant. At the time, Hanson had a consulting contract with Defendant to help find new markets for its ilmenite.
Hanson was later was employed by Defendant as a plant manager, and in that position, she continued to help Defendant find markets for ilmenite. Indeed, her employment agreement stated that one of her "key responsibilities" as plant manager was "[s]ales of ilmenite . . . as directed by the VP of Operations or President of [Defendant]."
In September 2019, after learning of Plaintiff's interest in purchasing ilmenite from Defendant, Rod Liebeck emailed Miller to inform him that Defendant "has production capacity to supply in excess of 10,000 mt[] [of ilmenite] per annum and would commit to holding [it] for [Plaintiff's] operations." Liebeck was Defendant's president.
Metric tonne, which is approximately 2,204 pounds.
Although Miller and Hanson sporadically exchanged emails over the ensuing months, it was not until August 2020 that negotiations for the sale of the ilmenite began in earnest. Specifically, on August 24, Miller emailed Hanson asking her to "confirm the availability and quantity" of Defendant's ilmenite. Hanson responded the same day, and the parties thereafter commenced negotiations.
As Hanson and Miller negotiated the terms, Hanson made sure that she had Liebeck's permission to move forward with the sale. On August 28, Hanson emailed Liebeck to give him "an update on ilmenite sales" and to "run [the] sale [with Plaintiff] by [him]" so that she could "gain approval or terminate efforts on that front." Liebeck responded that he would like to discuss the sale further with her over the phone and that he is "keen to pursue this but [his] preferred option would be to reprocess the ilmenite stored inside to remove the garnet."
There is a factual dispute as to whether Liebeck specifically authorized Hanson to enter into an agreement to sell the ilmenite to Plaintiff after the August 28 email, but it is undisputed that the negotiations between Miller and Hanson continued to progress after the email—which at least supports the inference that Liebeck gave her authorization to enter into an agreement with Plaintiff.
On October 1, Hanson emailed Miller a list of proposed terms and asked him to "review the [ ] terms and, if acceptable, either send a [purchase order] or confirm via email." The proposed terms were:
Commodity: Iron Ilmenite
Specifications: 56% Fe203 (+/-5%)
Packing: None, bulk
Origin: Fairless Hills, PA Plant
Quantity: 30,000 MT +/- 1,000 MT
Deliverable: Q1 2021
Price: $30/t Ex Works + $7.95 shipping, handling and port storage (detailed below).
Shipping Terms: Ex Works (Fairless Hills) with shipping costs passed through directly. Estimates follow:
Doc. 60-91 at 2-3 (bold and underlining in original).$1.35t/ Kinder Morgan Loadout
$2.25/t Four Seasons Trucking
$4.35/t Storage at Port (Kinder Morgan)
$7.95/t Total costs for trucking and storing at Port.
Miller responded on October 13 with a purchase order and questions about the moisture level at the time of shipment, the loading schedule, and when the material would be available for shipment. The purchase order was dated October 10 and entitled "P.O. No. 8315." It only specified the destination address (Plaintiff's Miramar Beach location), the item name (iron oxide), the description ("Iron/Oxide Titanium Dioxide FOB[] Plant Short Ton"), the quantity (30,000), the rate (30.00), and the purchase price ($900,000).
"Free on Board," which when coupled with a location, determines where the seller is required to deliver the goods and where the shipping costs and risk of loss shift to the buyer. See § 672.319, Fla. Stat.
Hanson forwarded the purchase order to Liebeck along with Miller's questions. Liebeck acknowledged receiving the purchase order and discussed the sale internally with Hanson.
On October 15, Hanson emailed an amended purchase order (presumably sent by Miller) to Liebeck along with the questions that Miller asked when he transmitted the first purchase order. The revised purchase order had a larger quantity (33,000 short ton), changed the shipping arrangements (from FOB to EXW), and included a shipping rate ($7.95/short ton) for a total price of $1,252,350. Liebeck responded that the purchase order was "much more attractive!" and answered Miller's questions.
"Ex works," which is an incoterm that means that the seller is only responsible for making the goods available at its location and the buyer is then responsible for all shipping costs to get the goods to its location.
The parties continued negotiating through the remainder of 2020, and on January 19, 2021, Hanson e-mailed Miller a list of revised terms and asked if he could submit a second amended purchase order with the new terms. The terms changed the quantity from 30,000 MT +/ 1,000 MT to 30,000 ST +/ 1,000 ST, the shipping from $7.95 to $8.18, and the shipping terms from "Ex Works Fairless Hills" to "FOB (Fairless Hills)."
Short ton, which is 2,000 pounds.
On January 22, Miller sent a revised purchase order (Doc. 60-92 at 2) to Hanson. This purchase order had the same number and date as the prior purchase orders, but its terms differed from the prior purchase orders and conformed to the proposed terms in Hanson's January 19 email, except that it did not list the commodity, specifications, or the specific shipping terms.
Hanson forwarded the purchase order to Paul Warden, Defendant's vice president of logistics and told him that "[w]e've received everything that we asked for on our end, we just need to confirm costs with Kinder Morgan and solidify the shipping date." Warden responded to Hanson that "Client Relations will put the order into the system."
Two weeks later, as the parties were preparing for shipment of the ilmenite, Liebeck received an email from John Thornett, a broker for a marketing company, informing him that Plaintiff "do[es] not appear to be too knowledgeable about the Ilmenite market and have [sic] been trying to sell [Defendant's] ilmenite into the Chinese market through several channels." Thornett warned Liebeck that Plaintiff reselling Defendant's ilmenite "is confusing for the market and does nothing for the reputation of [Defendant] as a reliable supplier."
Liebeck forwarded this email to Hanson telling her that he "would prefer to cut ties with [Plaintiff] and appreciate that it could jeopardise [sic] future sales and the reason for doing so is that it appears unlikely that [Plaintiff] have actually secured a sale for [Defendant's] ilmenite whereas we can lock in a better financial deal for 20,000mt at USD160CIF[] with reliability."
$160 with cost, insurance, and freight.
Accordingly, on February 10, Hanson emailed Miller to inform him that Defendant's parent company has "limited [Defendant's] sales to ex-China . . . to avoid the ilmenite from competing with our supply to the same region." Hanson apologized for this "additional limitation" and stated that she hoped they could "still make a deal happen." Miller responded that the new condition "shouldn't be a problem."
The parties had no further communications until March 10, when Miller, Liebeck, and Hanson held a conference call. During the call, Liebeck informed Miller that Defendant would not continue with the sale unless Miller confirmed that the company to which Plaintiff intended to resell the ilmenite was not in China.
The following day, Miller emailed Liebeck and Hanson a "recap of the three main points of [the] conference call"—namely that "[Defendant] no longer wishes to sell the ilmenite . . . to [Plaintiff]," that "[Defendant] is no longer honoring the accepted . . . purchase order #8315," and that they "discussed compensation for [Defendant] to backout of selling ilmenite to [Plaintiff]."
Liebeck responded five days later with an email explaining the decision to not to sell the ilmenite to Plaintiff. The email stated that the "action item" agreed upon during the conference call was for Plaintiff to identify the company to which it intended to sell the ilmenite so that Defendant could "confirm that it will not interfere with [Defendant's parent company's] traditional Chinese market" and determine "whether a future sale could be proceeded with."
As it turned out, Miller's deposition revealed that Plaintiff did intend to sell the ilmenite to a Chinese buyer all along—even after Miller told Hanson that the additional limitation "shouldn't be a problem." Miller testified that Plaintiff had a contract to resell 20,000 metric tonnes of the ilmenite that it was purchasing from Defendant for "$203 per ton" to an Australian company, but that company was essentially an intermediary for the end-purchaser in China.
The deal with the Chinese buyer fell through. Miller testified that the Chinese company backed out of the contract on or about February 5, 2021, because it claimed that testing showed that the ilmenite that Plaintiff was selling only had a titanium dioxide level of 43% and there was already ample supply of that quality of ilmenite in China for a much lower price.
Despite this explanation, Miller speculated that Plaintiff lost the contract with the Chinese buyer simply because it went around Plaintiff and purchased the ilmenite directly from Defendant. However, there is no evidence other than Miller's speculation to support that claim.
Miller claimed that Plaintiff was in discussions with at least one other company, but it is undisputed that the only firm agreement that it had was with the Chinese company.
III. Procedural Background
In August 2021, Plaintiff filed suit against Defendant in this Court. The complaint asserted claims for breach of express contract (Count I), breach of implied in fact contract (Count II), and unjust enrichment (Count III).
Defendant filed an answer denying the allegations in the complaint and asserting various affirmative defenses. The Court struck two of the affirmative defenses and treated several others as denials. See Doc. 33.
Discovery closed on August 31, 2022. The deadline for filing dispositive motions was extended to mid-October 2022 so the parties could engage in mediation and settlement discussions. See Docs. 54, 56. After reaching an impasse, the parties filed their respective motions for summary judgment.
Plaintiff also filed a Daubert motion to exclude the testimony of Defendant's minerals expert. That motion was granted in part and denied in part. See Doc. 88.
Briefing on the motions was completed in early-December 2022. The motions are ripe for rulings. No hearing is necessary to rule on the motions.
Defendant requested oral argument on its motion for summary judgment, see Doc. 63 at 33, but the Court sees no need for it. See N.D. Fla. Loc. R. 7.1(K) ("The Court may—and most often does—rule on a motion without oral argument, even if a party requests oral argument.").
IV. Standard of Review
"The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). An issue of fact is "material" if it would change the outcome of the litigation, and a dispute about a material fact is "genuine" if the evidence is such that it could lead a reasonable factfinder to find for the non-moving party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).
When reviewing a motion for summary judgment, the Court must view the evidence in the light most favorable to the non-moving party and draw all reasonable inferences in that party's favor. See Jeffery v. Sarasota White Sox, Inc., 64 F.3d 590, 594 (11th Cir. 1995). The movant bears "the initial burden to show, by reference to materials on file, that there are no genuine issues of material fact to be determined at trial." Mullins v. Crowell, 228 F.3d 1305, 1313 (11th Cir. 2000). Once the movant has satisfied that burden, the "burden shift[s] to the nonmoving party to demonstrate that summary judgment would be inappropriate because there exists a material issue of fact." Id. The Court's role at the summary judgment stage is not to weigh the evidence, but rather to "conclude whether [the evidence] is so one-sided that the result of any trial is inevitable." Turner v. Phillips, 2022 WL 458238, at *4 (11th Cir. Feb. 15, 2022).
The same standards apply when reviewing cross-motions for summary judgment, although such motions can be an indication that the material facts are not in dispute. See United States v. Oakley, 744 F.2d 1553, 1555-56 (11th Cir. 1984) (quoting Bricklayers, Masons & Plasterers Int'l Union of Am., Loc. Union No. 15, Orlando, Fla. v. Stuart Plastering Co., 512 F.2d 1017, 1023 (5th Cir. 1975)). Thus, when reviewing Plaintiff's motion for partial summary judgment, the Court must view the evidence and draw all reasonable inferences in favor of Defendant, and when reviewing Defendant's motion for summary judgment, the Court must view the evidence and draw all reasonable inferences in favor of Plaintiff.
V. Analysis
Plaintiff seeks partial summary judgment "on the question of liability for breach of express contract under Count One of the Complaint." Defendant seeks summary judgment on all claims asserted in the complaint. Each motion will be discussed in turn, starting with Plaintiff's motion.
A. Plaintiff's Motion
To prevail on its breach of contract claim, Plaintiff must establish "(1) a valid contract; (2) a material breach; and (3) damages." Rauch, Weaver, Norfleet, Kurtz & Co., Inc. v. AJP Pine Island Warehouses, Inc., 313 So. 3d 625, 630 (Fla. 4th DCA 2021). Plaintiff argues that it is entitled to summary judgment on the first two elements.
Specifically, Plaintiff contends that the undisputed evidence establishes that the parties had a contract (as memorialized in purchase order #8315 and the emails leading up to it) and that Defendant repudiated that contract by refusing to sell Plaintiff the ilmenite unless Plaintiff agreed to an additional condition of not reselling the ilmenite to a Chinese buyer. Defendant responds that Plaintiff's breach of express contract claim fails for three reasons: first, a contract was never formed between the parties; second, the communications between the parties did not conform with the statute of frauds; and third, even if there was a contract, Defendant did not breach it.
1. Existence of a Contract
Defendant argues that the parties did not have a contract because (a) Hanson did not have actual or apparent authority to enter into a contract for the sale of ilmenite on behalf of Defendant, and (b) the purchase order was not signed by Defendant's president and did not reflect an agreement between the parties as to the material terms.
a. Authority of Hanson to Bind Defendant
Defendant initially argues that Plaintiff "failed to plead a claim for agency in its Complaint and this failure is terminal to [Plaintiff]'s case," but that argument is meritless because under Florida law, a plaintiff "need not refer to the agency in the complaint but may merely allege the legal effect of the agent's action by averring that the contract was made by the principal himself." Maestrelli v. Arrigoni, Inc., 476 So. 2d 756, 757 (Fla. 5th DCA 1985) (citing St. Andrew's Bay Land Co. v. Mitchell, 4 Fla. 192 (1851)). Here, the complaint details the negotiations that resulted in a "contract between the parties," Doc. 1 at 7 (¶30), which is sufficient for pleading purposes to establish that the actions of the purported agent during the negotiations were binding on the principal.
That said, a principal is only bound to a contract entered into by an agent if the agent had the authority to enter into the contract on behalf of the principal. See Symons Corp. v. Tartan-Lavers Delray Beach, Inc., 456 So. 2d 1254, 1258 (Fla. 4th DCA 1984). "An agent's authority can be actual or apparent." Fla. Power & Light Co. v. McRoberts, 257 So. 3d 1023, 1026 (Fla. 4th DCA 2018). "Actual authority 'exists when a principal delegates authority to an agent by expressly authorizing the agent to do a delegable act.' " Id. (quoting Richard A. Lord, 12 WILLISTON ON CONTRACTS § 35:10 (4th ed.)). Apparent authority is the authority that " 'the principal knowingly permits the agent to assume or which he holds the agent out as possessing.' " Id. (quoting H. S. A., Inc. v. Harris-In-Hollywood, Inc., 285 So. 2d 690, 692-93 (Fla. 4th DCA 1973)).
Here, Plaintiff contends that the undisputed evidence establishes that Hanson had actual authority to enter into the contract on behalf of Defendant for the sale of ilmenite to Plaintiff. Defendant responds that the undisputed evidence establishes that Hanson had neither actual (nor apparent) authority to enter into a contract on its behalf. The Court does not agree with either party because although there is evidence from which a jury could find that Hanson did have actual authority, there is also evidence from which a jury could find that she did not have actual authority.
Plaintiff does not argue in its motion or its reply that Hanson had "apparent authority," so the Court need not consider that issue.
"The essential elements necessary to establish an actual agency relationship are (1) acknowledgment by the principal that the agent will act for him, (2) acceptance by the agent of the undertaking, and (3) control by the principal over the agent's actions." Taylor Grp., Inc. v. Indus. Distribs. Int'l Co., 859 F. App'x 439, 448 (11th Cir. 2021) (quoting Roman v. Bogle, 113 So. 3d 1011, 1016 (Fla. 5th DCA 2013)). "[T]he boundaries of an agent's authority are determinable as questions of fact by the jury." Cavic v. Grand Bahama Dev. Co., 701 F.2d 879, 887 n.4 (11th Cir. 1983) (applying Florida law).
Here, both Liebeck and Hanson testified that Hanson was not authorized to enter into contracts on behalf of Defendant, either in her role as an independent contractor or an employee of Defendant. Plaintiff characterizes this testimony as "self-serving"—which it obviously is—but that is immaterial at this stage of the case. See Patterson v. Georgia Pac., LLC, 38 F.4th 1336, 1350-51 (11th Cir. 2022) ("[W]hen conflicts arise between the facts evidenced by the parties, we must credit [the non-movant's] version. And that is true even if, as is often the case, the plaintiff's evidence consists primarily or solely of her own self-serving sworn statements or testimony.") (internal citation and quotation marks omitted) (alteration in original). Suffice it to say, a jury could find from this testimony that Hanson did not have authority to enter into a contract with Plaintiff on behalf of Defendant.
To be sure, there is also evidence from which a jury could find that Hanson was authorized (either explicitly or implicitly) to enter into the specific contract at issue in this case. Specifically, the fact that Hanson continued to move forward with the negotiations with Plaintiff after she and Liebeck spoke on the phone after her August 28 email asking to run the sale of ilmenite to Plaintiff by him so she could "gain approval or terminate efforts on that front" supports the inference that Hanson's subsequent actions were authorized by Liebeck and, thus, were on behalf of Defendant. Additionally, it is noteworthy that Liebeck did not suggest in his email to Miller after the March 10 conference call that Hanson did not have the authority to bind Defendant to a contract and he seemingly acknowledged that the parties had a contract. See Doc. 63-2 at 2 ("Had [Defendant] being [sic] informed that the ilmenite would be sold into China it would not have entered into any sale of the ilmenite.") (emphasis added). Finally, by the time the negotiations concluded in January 2021, Hanson was no longer an independent contractor and instead was employed by Defendant as a plant manager where one of her "key responsibilities" was "[s]ales of ilmenite."
In sum, because there is a factual dispute as to whether Hanson was authorized to enter into contracts on behalf of Defendant, Plaintiff is not entitled to partial summary judgment as to the existence of a contract. Based on that conclusion, the Court need not consider Defendant's other arguments in opposition to Plaintiff's motion for partial summary judgment. However, the Court will do so for sake of completeness—and because Defendant raises essentially the same arguments in support of its motion for summary judgment.
b. Sufficiency of the Purchase Order to Constitute a Contract
Defendant argues that the revised purchase order sent by Miller on January 19, 2021, is not a valid contract because Liebeck did not sign the purchase order and it does not reflect that the parties agreed on all material terms. The Court disagrees.
Under Florida law, "[a] contract is made when the three elements of contract formation are present: offer, acceptance, and consideration" and "[n]o person or entity is bound by a contract absent the essential elements of offer and acceptance." Nowlin v. Nationstar Mortg., LLC, 193 So. 3d 1043, 1045 (Fla. 2d DCA 2016) (quoting 11 Fla. Jur.2d Contracts § 25 (2016)). At common law, a contract could not be formed unless the parties agreed on all material terms, see e.g., Glosser v. Vasquez, 898 So. 2d 1179, 1181 (Fla. 3d DCA 2005) (citing Webster Lumber Co. v. Lincoln, 94 Fla. 1097, 115 So. 498, 502 (1927)), but where, as here, the contract is governed by the Uniform Commercial Code (UCC), a contract can be formed "[e]ven though one or more terms are left open" so long as "the parties have intended to make a contract and there is a reasonably certain basis for giving an appropriate remedy." § 672.204(3), Fla. Stat.
Here, the fact that Liebeck did not sign the purchase order is immaterial if Hanson had the authority to bind Defendant to a contract because the communications between Hanson and Miller establish a "meeting of the minds" regarding the essential terms of the agreement for Plaintiff's purchase of ilmenite from Defendant. Hanson's January 19 email sent to Miller contained a list of terms, and Hanson asked him to send a purchase order if he agreed to those terms. Miller responded that those terms "will work" and subsequently sent a purchase order containing those terms. Thus, in contract formulation parlance, Hanson's email was the offer and Miller's purchase order was the acceptance—which, when coupled with the $1,145,700 that Plaintiff agreed to pay for the ilmenite, resulted in the formation of a contract. This is true notwithstanding Defendant's argument that "purchase orders are generally considered offers," Doc. 63 at 8 (emphasis added), and it is bolstered by the fact that after receiving the purchase order, Hanson sent an internal email confirming that "[w]e've received everything that we asked for on our end."
The fact that the purchase order was not a "mirror image" of the terms listed in Hanson's email is immaterial because, under the UCC, "[a] definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance even though it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to the additional or different terms." § 672.207(1), Fla. Stat.; see also Paul Gottlieb & Co. v. Alps S. Corp., 985 So. 2d 1, 6 (Fla. 2d DCA 2007) (recognizing that the UCC "provides a more flexible approach" than the common law "mirror image rule" when it comes to variations in the terms of the offer and the acceptance).
The Court did not overlook Defendant's argument that the parties' communications do not establish a meeting of minds with respect to the quality (i.e., TiO2 percentage) of the ilmenite that Defendant agreed to sell and Plaintiff agreed to buy. However, if (as Defendant claims), "[t]he TiO2 percentage dictates the quality, and therefore the price, of the ilmenite," Doc. 81 at 16, then the quality of the ilmenite that Defendant agreed to sell and that Plaintiff agreed to buy can be inferred from the price agreed upon by the parties in the purchase order.
This conclusion is not undermined by Hanson v. Maeder, 2021 WL 210952 (Iowa Ct. App. Jan. 21, 2021), which Defendant argues is "analogous to the instant case." That unpublished decision is not binding authority on this Court—or even in in Iowa, see Iowa R. App. P. 6.904(2)c.—and it is distinguishable in any event.
Hanson involved a contract for the sale of cattle. The contract did not identify the type of cattle that was being sold and the court held that the contract was invalid because the court could not "fill in" that missing term. See 2021 WL 210952 at *3. Here, by contrast, there is nothing for the Court to "fill in" because the parties' agreement implicitly includes the quality of the ilmenite because the contract includes a price, and as noted above, the quality determines the price.
Accordingly, if the jury determines that the Hanson had the authority to enter into a contract with Defendant for the sale of ilmenite to Plaintiff, there is evidence from which a jury could find that the parties had a valid contract because Hanson's January 19 email and Miller's January 22 purchase order appear to reflect a "meeting of the minds" as to the terms of the sale.
* * *
In sum, for the reasons stated above, although there is evidence from which a jury could find that there was a meeting of the minds between Hanson and Miller on all material terms, there is also evidence from which a jury could find that Hanson did not have the authority to bind Defendant to a contract. Accordingly, the Court cannot find as a matter of law that there is binding contract between Plaintiff and Defendant.
2. Compliance with the Statue of Frauds
Defendant next argues that the alleged contract is unenforceable for failure to comply with the Statute of Frauds. Plaintiff responds that it did not have to satisfy the statute of frauds because the "merchant exception" in § 672.201(2), Fla. Stat., applies. The Court need not decide whether the merchant exception applies because Hanson's January 19 e-mail satisfies the Statute of Frauds.
The Statute of Frauds, as codified in the UCC, generally provides that a contract for the sale of goods for $500 or more is not enforceable unless it is in writing and "signed by the party against whom enforcement is sought or by his or her authorized agent." See § 672.201(1), Fla. Stat. "The statute of frauds was enacted to prevent fraud and the enforcement of claims based on loose verbal statements." LaRue v. Kalex Constr. & Dev., Inc., 97 So. 3d 251, 253 (Fla 3d DCA 2012); see also DK Arena, Inc. v. EB Acquisitions I, LLC, 112 So. 3d 85, 93 (Fla. 2013) (explaining that the Statute of Frauds is "grounded in a policy judgment that certain contracts should not be enforced unless supported by written evidence"). The statute is to be "strictly construed to prevent the fraud it was designed to correct." Tydir v. Williams, 89 So. 3d 1129, 1131 (Fla. 1st DCA 2012) (quotation marks and citation omitted).
Here, Defendant contends that the January 19 and January 22 emails between Hanson and Miller do not meet the Statute of Frauds because they are not signed by the party against whom enforcement is sought—i.e., Defendant—but if a jury determines that Hanson had the authority to contract with Plaintiff for the sale of ilmenite, then her signature would be sufficient to satisfy the Statute of Frauds. See § 672.201(1), Fla. Stat. (noting that the writing must be signed by "the party against whom enforcement is sought or by his or her authorized agent") (emphasis added). That, however, raises the question of whether Hanson's email is "signed" for purposes of the Statute of Frauds.
The Eleventh Circuit recently addressed a similar issue in BrewFab, LLC v. 3 Delta, Inc., 2022 WL 7214223 (11th Cir. Oct. 13, 2022). In that case, the party against whom enforcement was sought sent a text message stating:
As per our conversation on Jan. 30th 2020 I george [sic] Russo from 3 Delta do promise to pay brew fab in full all outstanding bills as of this date and all agreed upon work done for 3 delta future forward. I thank you for your patience.Id. at *1. The district court determined that this text was a personal guaranty and that it satisfied the Statute of Frauds because the language "I george Russo from Delta" was an electronic signature under Florida law. Id. at *2. The Eleventh Circuit affirmed, reasoning that the language "I george Russo from 3 Delta" "satisfies the definition of an electronic signature, i.e., 'letters, characters, or symbols' intended to 'authenticate a writing' " and the language is " 'logically associated with' the relevant guaranty agreement, because [it] precedes Russo's promise to pay 3 Delta's debt." Id. at *5 (quoting § 668.003, Fla. Stat.). The court also rejected the argument that a text message could not satisfy the statute of frauds under Florida law. Id. at *5 n.7 (citing Kolski ex rel. Kolski v. Kolski, 731 So. 2d 169, 171 (Fla. 3d DCA 1999)).
Here, the January 19 email in which Hanson conveyed the revised terms to Miller and asked him to send a revised purchase order if the terms were agreeable closed with "Best Regards, Brianna," which is sufficient to authenticate the email. Additionally, although an electronic signature is not required to come at the end of an agreement, see id., the fact that the language "Best Regards, Brianna" was at the end of the email establishes its logical association with the revised terms proposed in the email.
The Court did not overlook that neither Hanson nor anyone else from Defendant signed the purchase order. However, that is immaterial because its terms matched those in Hanson's email, and the email is essentially what Plaintiff is seeking to enforce against Defendant. See 2 Corbin on Contracts § 503, 711-12 (1950) ("A prepares and signs [a written draft] and sends it to B as an offer, without requiring that B shall accept by signing it. In such a case, B has power to accept and to close the deal by an oral communication, or by a separate writing, signed or unsigned. The written and signed offer of A is a sufficient memorandum of the contract making it enforceable against A, when he is the party to be charged in an action subsequently brought. This is the law, even though the writing was signed before any contract came into existence, and even though it has no probative value in proving that B ever accepted.").
Accordingly, if the jury determines that Hanson had the authority to enter into a contract with Defendant for the sale of ilmenite to Plaintiff, the undisputed evidence establishes that the contract complies with the Statute of Frauds.
3. Breach
Plaintiff contends that the undisputed evidence establishes that Defendant breached the contract through an anticipatory repudiation. See Alvarez v. Rendon, 953 So. 2d 702, 709 (Fla. 5th DCA 2007) ("An anticipatory breach of contract occurs before the time has come when there is a present duty to perform as the result of words or acts evincing an intention to refuse performance in the future."); Twenty-Four Collection, Inc. v. M. Weinbaum Const., Inc., 427 So. 2d 1110, 1112 (Fla. 3d DCA 1983) (citation omitted) ("[A]n anticipatory repudiation creates a cause of action for breach of contract."). Specifically, Plaintiff contends that Defendant anticipatorily repudiated the contract when, on February 10, 2021, Hanson emailed Miller to inform him that Defendant's parent company limited Defendant's sales of ilmenite "to ex-China." Defendant responds that it did not repudiate the contract because Miller agreed not to sell the ilmenite to a Chinese buyer and Defendant was willing to move forward with the sale as long as Plaintiff agreed not to sell the ilmenite to a Chinese buyer.
The problem with Defendant's argument—that no breach occurred because it was always willing to sell the ilmenite under the condition that the resale be limited to a buyer outside of China—is that there is evidence from which a jury could find that a contract had already been formed before Hanson informed Miller of the "additional limitation" on February 10. That being the case, there is evidence from which a jury could find that Hanson's email repudiated contract—particularly since that email was preceded by an email from Liebeck to Hanson stating that he wanted to "cut ties" with Plaintiff. Moreover, even if the contract was not repudiated on February 10, there is also evidence from which a jury could find that it was repudiated in March 2021 when Liebeck stated in unequivocal terms that Defendant would not continue with the sale if Plaintiff would not confirm that it would not resell the ilmenite to a Chinese buyer. See Croker v. Powell, 115 Fla. 733, 750-51, 156 So. 146 (1934) ("[T]he repudiation of the contract must be positive, unequivocal, and absolute.").
The Court did not overlook that Miller's response to Hanson that the limitation "shouldn't be a problem" could be viewed as an agreement to modify the existing contract to include that limitation. However, there is at a minimum a factual dispute on the issue of modification because the subsequent communications between the parties suggest that Miller never agreed to the "additional limitation" and it also does not appear from the emails between the parties exchanged after the March 10 conference call that either Miller or Liebeck thought that the contract included a limitation on sale of the ilmenite to China.
That said, if a jury determined that Hanson's email about the "additional limitation" was an offer to modify the existing contract that Miller accepted when he responded that the limitation "shouldn't be a problem," then it could find that Defendant did not repudiate the contract. Indeed, if the contract was modified to include a limitation on resale of the ilmenite to China, then Liebeck had the right to seek assurance from Miller that Plaintiff would comply with that obligation and terminate the contract when Miller failed to provide that assurance. See Ford Motor Credit Co. v. Alachua Trading Co., 531 So. 2d 982, 984 (Fla. 1st DCA 1988) ("[The UCC] authorizes a demand for assurance of performance when grounds for insecurity arise. If a demand is made and adequate assurance is not forthcoming the aggrieved party may then treat the contract as breached by repudiation."); § 672.703(6), Fla. Stat. ("Where the buyer . . . repudiates with respect to a part or the whole, . . . the aggrieved seller may . . . cancel.").
In sum, although it is undisputed that Defendant made clear that it was not going to honor the agreement embodied in the purchase order sent on January 22 in response to Hanson's January 19 email unless Plaintiff agreed to an additional limitation on its resale of the ilmenite that was not part of the agreement, the Court cannot determine as a matter of law whether that amounts to an anticipatory repudiation of the parties' agreement because there are conflicting inferences that can be drawn from the evidence with respect to whether Miller agreed to modify the parties' agreement to include that limitation and then refused to provide assurances to Defendant that it intended to comply with that limitation. Accordingly, even if Plaintiff was entitled to summary judgment on the question of whether the parties had a contract, it would not be entitled to summary judgment on the question of whether Defendant breached the contract.
B. Defendant's Motion
Defendant seeks summary judgment on all three counts asserted in the complaint. The arguments related to Counts I and II are essentially the same, so those counts will be discussed together. Count III will be discussed separately.
1. Counts I and II (Breach of Express or Implied Contract)
Defendant's arguments in its motion for summary judgment on the breach of contract claims in Counts I and II mirror its arguments in opposition to Plaintiff's motion for partial summary judgment on those claims—i.e., the parties did not have a valid contract because there was no meeting of the minds regarding the quality of ilmenite, the "purported contract" did not comply with the Statute of Frauds, and Hanson did not have authority to bind Defendant to a contract. The same factual disputes that preclude summary judgment in favor of Plaintiff on those issues also preclude summary judgment in favor of Defendant. However, on the issue of lost profits, the Court agrees with Defendant that there are no material facts in dispute.
Defendant also argues that Plaintiff's January 22 purchase order was merely an offer that was not accepted by performance or the issuance of an invoice. However, as Plaintiff argues, the undisputed evidence establishes that "[t]he [purchase order] did not constitute the beginning of the exchange; rather, it was a response to and acceptance of the terms offered by [Defendant]." Doc. 79 at 9. The September 2020 email exchange attached to Defendant's reply is not contrary authority because, although Hanson states in her email that she had to get the sale "approved" by Defendant's president, there is nothing in the parties' subsequent communications (particularly Hanson's January 19 email) that suggests that the sale is conditioned on anything other than Plaintiff's acceptance of the terms proposed by Hanson. Moreover, if approval by the president is required, there is at least a factual dispute as to whether that approval was granted since the purchase order was "put . . . into the system" for process, and in response to Miller's email claiming that Defendant "is no longer honoring the accepted . . . purchase order #8315," Liebeck did not assert that the purchase order had not been accepted or that it was merely an offer that he never approved.
Lost profits are recoverable under Florida law if "(1) the breaching party caused the loss; and (2) the amount of such damages can be adequately determined by some standard." HGI Assocs., Inc. v. Wetmore Printing Co., 427 F.3d 867, 878-79 (11th Cir. 2005).
Here, the main problem for Plaintiff is causation. Specifically, although it is undisputed that Plaintiff had an agreement with a third-party buyer (in China) to purchase the ilmenite bought from Defendant, it is also undisputed that the Chinese buyer backed out of that deal before Defendant anticipatorily repudiated the contract with Plaintiff. Thus, even if Defendant had not breached the contract, Plaintiff was not going to make the profit that it expected from the sale to the Chinese buyer because that sale had already fallen through.
Plaintiff also would likely have had a hard time convincing a jury that it was entitled to anything close to the amount of lost profits that it was seeking because the amount was based on the assumption that it could resell the ilmenite for $203 per metric tonne, but that figure appears to have been based on a mutual misunderstanding between the prospective purchaser (the Chinese company) and Plaintiff regarding the quality of the ilmenite because the reason the Chinese buyer gave for backing out of the contract was that the market price for ilmenite of the quality that Plaintiff was selling was only $140 per metric tonne and Defendant's expert testified that it was considerably less than that. That said, assuming Plaintiff was able to overcome the issue of causation, the amount of lost-profit damages would be an issue for the jury because Defendant has not argued that Mr. Miller does not have the requisite training or experience to opine on the value of ilmenite.
There is no evidence that Plaintiff had an alternate third-party buyer for the ilmenite and there is also no evidence that it could have sold the ilmenite to a different buyer for the same (or similar) price as Plaintiff was going to sell the ilmenite to the Chinese buyer. Miller's testimony that Plaintiff could have made the same profit it was going to make in the sale to the Chinese buyer by selling the ilmenite to another buyer is speculative, at best, and is legally insufficient to support a claim for lost profits—particularly since it is undisputed that Plaintiff was new to the ilmenite market and had no track record of profitability in that market. See A&P Bakery Supply & Equip. Co. v. Hawatmeh, 388 So. 2d 1071, 1072 (Fla. 3d DCA 1980) ("Proof of profits for a reasonable time anterior to the breach is required to establish lost profits.").
Accordingly, Plaintiff cannot recover lost profits in this case. Based on this conclusion, the Court need not consider Defendant's argument that Plaintiff cannot recover lost profits because it failed to mitigate its damages. However, the Court will do so for the sake of completeness.
The Court did not overlook the possibility that Plaintiff might be able to recover the profit that it expected to make on the sale to the Chinese buyer under the theory that Defendant tortiously interfered with that contract. However, Plaintiff did not assert a claim for tortious interference in the complaint and there is no evidence to support Miller's speculation that Defendant had anything to do with the Chinese buyer's decision to back out of its deal with Plaintiff. Nor did the Court overlook that Miller had a "valid contract" with the Chinese buyer, but if that is true, Plaintiff's remedy is to sue the Chinese buyer (not Defendant) for breach of contact.
Under Florida law, a plaintiff only has an obligation to make "reasonable effort" to mitigate its damages. See Exim Brickell LLC v. PDVSA Servs., Inc., 516 F. App'x 742, 759 (11th Cir. 2013) (citing Nyquist v. Randall, 819 F.2d 1014, 1019 (11th Cir. 1987)). Here, although it is undisputed that Plaintiff did not take any steps to mitigate its damages, the Court cannot find as a matter of law that it was unreasonable for it not to do so based on Miller's unrebutted testimony that there were no steps Plaintiff could take to mitigate its damages. See Gulf Power Co. v. Coalsales II, LLC, 522 F. App'x 699, 705 (11th Cir. 2013) ("The reasonableness of a buyer's cover is a finding of fact."). Indeed, on this point, it is noteworthy that Defendant did not identify anything Plaintiff could have done to mitigate its damages.
In sum, for the reasons stated above, even if the jury finds that the parties had an express or implied contract that Defendant breached, Plaintiff will not be able to recover lost profits.
Count III (Unjust Enrichment)
Defendant argues that it is entitled to summary judgment on Plaintiff's unjust enrichment claim in Count III because the undisputed evidence shows that the benefit Plaintiff allegedly conferred on Defendant (i.e., determination of the quality of the ilmenite through testing) was for Plaintiff's own benefit, not Defendant's. The Court agrees that Plaintiff's unjust enrichment claim fails but for different reasons.
First, Plaintiff effectively abandoned the unjust enrichment claim by not responding to Defendant's argument that it was entitled to summary judgment on that claim. See Davis v. Coca-Cola Bottling Co. Consol., 516 F.3d 955, 971 n.36 (11th Cir. 2008) ("The claim fails for alternative reasons. First, Martin did not defend the claim on summary judgment; he thus abandoned it."); Kerns v. Lamot Indus. LLC, 2017 WL 2903348, at *5 n.10 (N.D. Fla. June 1, 2017) ("The defendants asserted additional FLSA exemptions and/or several affirmative defenses at earlier points in this case (e.g., in their answer), and the plaintiff has sought summary judgment for those defenses. Although the defendants have opposed the plaintiff's motion, they have not opposed it with respect to those other defenses. Consequently, those defenses have been waived."); Powell v. Am. Remediation & Envtl., Inc., 61 F. Supp. 3d 1244, 1252 n.9 (S.D. Ala. 2014) ("Where a party wholly fails to respond to a summary judgment motion, the district court must make sure that it nonetheless is appropriate to enter summary judgment against the party that did not respond; in contrast, where the non-moving party fails to address a particular claim asserted in the summary judgment motion but has responded to other claims made by the movant, the district court may properly consider the non-movant's default as intentional and therefore consider the claim abandoned."), aff'd 618 F. App'x 974 (11th Cir. 2015).
Second, the claim fails on the merits. Defendant argues that Plaintiff cannot prevail on its unjust enrichment claim because Plaintiff tested the ilmenite for its own benefit, but even though the undisputed evidence supports that claim, it is a red herring because the intent of the parties is immaterial in an unjust enrichment analysis. See 14th & Heinberg, LLC v. Terhaar and Cronley General Contractors, Inc., 43 So. 3d 877, 881 (Fla. 1st DCA 2010). What matters is whether Plaintiff "conferred a benefit on the defendant" and whether Defendant "voluntarily accept[ed] and retain[ed] the benefit," Hillman Cost. Corp. v. Wainer, 636 So. 2d 576, 577 (Fla. 4th DCA 1994), and on that issue, there is no evidence from which a jury could find that Plaintiff conferred a benefit on Defendant related to the testing of the ilmenite.
The Court did not overlook that Liebeck testified that that Defendant was willing to compensate Plaintiff for the testing of the ilmenite if Miller "was willing to . . . give us that testing [results] back." Doc. 60-1 at 188. Although Liebeck testified that this offer was only made as "a sign of good faith," id., a jury could reasonably find that Defendant would have benefited from having test results that it could use when marketing the ilmenite to another buyer. That, however, does not help Plaintiff establish its unjust enrichment claim because there is no evidence that Miller provided the test results to Defendant. Thus, there is no evidence from which a jury could find that Plaintiff conferred any benefit on Defendant.
Accordingly, Defendant is entitled to summary judgment on Plaintiff's unjust enrichment claim in Count III of the complaint.
VI. Conclusion
In sum, for the reasons stated above, it is ORDERED that:
1. Plaintiff's motion for partial summary judgment (Doc. 60) is DENIED.
2. Defendant's motion for summary judgment (Doc. 63) is:
a. GRANTED with respect to the unjust enrichment claim in Count III of the complaint, and that claim is DISMISSED with prejudice.
b. DENIED with respect to the breach of express and implied contract claims in Counts I and II of the complaint, except insofar as those claims seek damages for lost profits.
3. Within 7 days from the date of this Order, the parties shall confer and advise the Court of several mutually agreeable dates and times during the following two weeks for a telephonic case management conference to schedule what remains of this case for trial and establish the related pretrial deadlines.
It is unclear whether Plaintiff is seeking damages other than lost profits on the breach of contract claims, although Plaintiff's Rule 26(a) disclosures suggest that it is not. See Doc. 17 at 3-4; Doc. 63-7. If that is the case, there may not be any reason to proceed to trial on Counts I and II. The parties shall be prepared to discuss that issue at the telephonic case management conference.
DONE and ORDERED this 2nd day of March, 2023.