GATOR OF FLORIDA INC. v. UNIFORMITY, LLC

Filing 26

OPINION. Signed by Judge William J. Martini on 5/19/11. (gh, )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
GATOR OF FLORIDA INC.,
Plaintiff,

Civ. No. 10-782-WJM

v.

OPINION

UNIFORMITY, LLC,

HON. WILLIAM J. MARTINI

Defendant.

Plaintiff Gator of Florida Inc. (“Gator”) moves for summary judgment. Prior
to the institution of this lawsuit, Gator and Defendant Uniformity, LLC
(“Uniformity”) entered into a settlement agreement (the “Agreement”) to resolve a
dispute regarding nonpayment of invoices and related issues. Gator claims
Uniformity has breached the Agreement, and has filed a Complaint seeking to
enforce the Agreement as well as stating other claims against Uniformity. For the
reasons discussed below, the Court GRANTS summary judgment for Gator IN
PART and DENIES it IN PART.
I.

Background

None of these facts are in dispute. Gator, a clothing wholesaler, sold
merchandise to Uniformity, a uniform supplier, from on or around 2007 and
continuing at least through June 2008, when Uniformity stopped paying the
invoices submitted by Gator. On July 23, 2009, the parties executed the Agreement
pursuant to which Uniformity agreed to make monthly payments of $5,000
beginning July 1, 2009 until the entire balance of outstanding money due Gator,
$126,283.90, was paid in full. Uniformity also agreed that interest would accrue on
the unpaid balance at an annual rate of 18%. Uniformity made monthly payments
in July, August, and September of 2009 – a total of $15,000. Uniformity did not
make any payment in October 2009. In November 2009, Gator agreed to accept a
reduced payment amount of $1,000 per month from October 2009 through
February 2010, with $5,000 monthly payments to resume in March 2010.
Uniformity made its reduced monthly payments for October and November 2009 –
a total of $2,000. At the time of the filing of the present motion, Uniformity had
not made any payment since November 2009.
On February 16, 2010, Gator filed a four-count complaint against
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Uniformity claiming Uniformity still owes $109,283.90 plus interest under the
Agreement, and bringing claims for breach of contract, unjust enrichment, and
conversion of unpaid-for and unreturned merchandise.
II.

Legal Analysis

Summary judgment is appropriate “if the pleadings, the discovery
[including, depositions, answers to interrogatories, and admissions on file] and
disclosure materials on file, and any affidavits show that there is no genuine issue
as to any material fact and that the movant is entitled to judgment as a matter of
law.” Fed. R. Civ. P. 56; see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23
(1986); Turner v. Schering-Plough Corp., 901 F.2d 335, 340 (3d Cir. 1990). A
factual dispute is genuine if a reasonable jury could find for the non-moving party,
and is material if it will affect the outcome of the trial under governing substantive
law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The Court
considers all evidence and inferences drawn therefrom in the light most favorable
to the non-moving party. Andreoli v. Gates, 482 F.2d 641, 647 (3d Cir. 2007).
In response to the motion for summary judgment, Uniformity’s chief
argument is that the Agreement is inadmissible evidence under Federal Rule of
Evidence 408,1 which precludes introduction of evidence regarding settlements for
the purpose of proving liability or the amount of damages relating to the dispute
that lead to the settlement. Uniformity claims that because FRE 408 prevents Gator
from introducing the Agreement into evidence, Uniformity lacks the factual basis
necessary to succeed on summary judgment.
But FRE 408 does not prevent introduction of a settlement agreement in an
action to enforce that agreement. Cates v. Morgan Portable Bldg. Corp., 780 F.2d
683 (7th Cir. 1985) (“Obviously a settlement agreement is admissible to prove the
parties’ undertakings in the agreement, should it be argued that a party broke the
agreement.”); St. Paul Fire and Marine Ins. Co. v. Brother Intern. Corp., 2007 WL
2571960, at *18 (D.N.J. Aug. 31, 2007). Here, despite Uniformity’s contentions,
the Complaint states a cause of action for breach of the Agreement. The Complaint
alleges the existence of the Agreement, alleges Uniformity’s breach, alleges
Gator’s compliance, and claims damages in an amount equal to what is owed under
the Agreement. See, e.g., Carter Ledyard & Milburn LLP v. Carrascosa, 2010 WL
3703699, at *3 (D.N.J. Sep. 10, 2010) (discussing elements necessary to show
breach of contract). The Complaint does not explicitly title any of its four counts as
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FRE 408 states in relevant part: “Evidence of the following is not admissible on behalf of any party, when
offered to prove liability for, invalidity of, or amount of a claim that was disputed as to validity or amount,
or to impeach through a prior inconsistent statement or contradiction: (1) furnishing or offering or
promising to furnish--or accepting or offering or promising to accept--a valuable consideration in
compromising or attempting to compromise the claim . . .”

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“Breach of the Settlement Agreement” or something similar, but a claim for breach
of the Agreement is obvious upon reading the Complaint as a whole. The
Complaint adequately provides Uniformity with sufficient notice of Gator’s claim
for breach of the Agreement against it, as required by Federal Rule of Civil
Procedure 8(a).
There are no genuine issues as to any facts material to the alleged breach.
The Agreement is admissible for the purpose of Gator’s claim against Uniformity
for breach thereof, and, as Uniformity acknowledges, it speaks for itself. In its
Answer to the Complaint, Uniformity admitted all of the factual allegations
relevant to Gator’s claim for breach, including the existence of the Agreement and
its failure to make any payment since November 2009. These undisputed facts
show that Uniformity is currently in breach of the Agreement. Discovery is
complete, and Uniformity has failed to raise a dispute as to any material facts. It
has not challenged the validity of the Agreement, challenged Gator’s claim that
Gator has complied with the terms of the Agreement, or otherwise raised any
defense or evidence suggesting that summary judgment is inappropriate.
III.

Conclusion

For the reasons stated above, the Court will grant summary judgment for
Gator on its claim that Uniformity breached the Agreement. But the factual
evidence regarding Gator’s remaining claims is sparse, and Uniformity does
dispute some facts relevant to those claims. Inasmuch as Gator intended to also
move for summary judgment on claims other than for breach of the Agreement,
the Court denies the motion.

/s/ William J. Martini
WILLIAM J. MARTINI, U.S.D.J.

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