FinishMaster, Inc. v. Richard's Paint and Body Shop, LLC et al

Filing 232

ORDER follows oral order: Oral Order on Motion for Judgment as a Matter of Law. Signed by Judge Andrew W. Austin. (jk, )

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TEXAS
AUSTIN DIVISION
RICHARD’S PAINT AND BODY SHOP,
LLC D/B/A CUSTOM CAR CRAFTERS
and RICHARD W. WOOD,
Plaintiffs, Counter-Defendants
v.
BASF CORPORATION AND
FINISHMASTER, INC.,
Defendants, Counter-Plaintiffs

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NO. A-11-CA-560 AWA

ORDER
Before the Court is the Defendants’ Oral Motion for Judgment as a Matter of Law with
regard to all of Plaintiffs’ claims, pursuant to Federal Rule of Civil Procedure 50(a), presented to the
Court at the close of the Plaintiffs’ evidence on August 27, 2012. The Court made oral rulings on
the motion on the record. This order is entered to memorialize those rulings.
I. STANDARD OF REVIEW
Federal Rule of Civil Procedure 50(a) instructs that a grant of judgment as a matter of law
(“JMOL”) is proper where “a party has been fully heard on an issue during jury trial and the court
finds that a reasonable jury would not have a legally sufficient evidentiary basis to find for the party
on that issue.” In assessing a Rule 50(a) motion, the Court must “review all of the evidence in the
record, draw all reasonable inferences in favor of the nonmoving party, and may not make credibility
determinations or weigh the evidence.” Ellis v. Weasler Engineering, 258 F.3d 326, 337 (5th Cir.
2001); Reeves v. Sanderson Plumbing Prods., 530 U.S. 133, 150 (2000). These limitations are
imposed because “credibility determinations, the weighing of the evidence, and the drawing of
legitimate inferences from the facts are jury functions, not those of a judge.” Reeves, 530 U.S. at

150–51. The motion should be granted where the evidence so strongly favors one party that a
“reasonable trier of fact could not arrive at a contrary verdict.” Turner v. Purina Mills, Inc., 989 F.2d
1419, 1421 (5th Cir. 1993). Although the federal standards of review apply, a court sitting in
diversity, as here, “refers to state law for the kind of evidence that must be produced to support a
verdict.” Goodner v. Hyundai Motor Co., Ltd., 650 F.3d 1034, 1040 (5th Cir. 2011).
II. ANALYSIS
As stated on the record on August 27, 2012, the Court made the following rulings on the
Defendants’ JMOL:
A.

Richard Wood’s Claims
Although Richard W. Wood was named a plaintiff in this case, he failed to present any

evidence which would support a claim for relief on his behalf individually. Although Mr. Wood
signed the Agreements with Defendant FinishMaster Inc., and BASF Corporation, he did so as an
officer of his company—Richard’s Paint and Body Shop LLC—which was the party to the
Agreements. See Exhibits P-13 and P-14.1 Because Mr. Wood was not a party to the contract, he
is unable to assert any contractual or quasi-contractual claims in this case under either New Jersey
or Indiana Law. See Medical Society of New Jersey v. AmeriHealth HMO, Inc., 868 A.2d 1162,
1170 (App. Div. 2005) (association lacked standing to assert claims for breach of contract and breach
of the duty of good faith and fair dealing where it was not a party to the contracts or an assignee of
the contractual rights); City of Indianapolis v. Kahlo, 938 N.E.2d 734, 742 (Ind. Ct. App. 2010)
(“Normally, one who is not a party to a contract has no standing to enforce it”).
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The only capacity in which Mr. Wood acted as an individual in the transaction was in acting
as a guarantor of his company’s obligations under the Agreement with FinishMaster. See Exhibit
P-13 at p.4.
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In addition, Mr. Wood failed to introduce any evidence showing that he has a claim for fraud
separate and apart from the claim asserted by RPBS. Based upon the foregoing, the Court
GRANTED Defendants’ JMOL with regard to Plaintiff Richard Wood.
B.

Negligence Claim
To establish a claim of negligence under Texas law, evidence must be produced to establish

a duty, a breach of that duty, and damages proximately caused by the breach. See Werner v. Colwell,
909 S.W.2d 866, 869 (Tex. 1995). RPBS failed to introduce any evidence to support any of these
elements of negligence. Specifically, it failed to demonstrate that Defendants owed a duty to RPBS
beyond Defendant’s obligations under the Agreements. See Myers v. Ford Motor Credit Co., 2010
WL 2730640 at * 3 (N.D. Tex. July 8, 2010); Southwestern Bell Tel. Co. v. DeLanney, 809 S.W.2d
493, 494-95 (Tex. 1991). Further, RPBS failed to introduce any evidence of the standard of care in
the auto paint industry with regard to this claim. Based upon the foregoing, Defendants’ JMOL with
regard to Plaintiff’s negligence claim was GRANTED.
C.

Breach of Express Warranty Claim
RPBS failed to introduce sufficient evidence to support its breach of express warranty claims

under either New Jersey or Indiana Law.2 RPBS was unable to identify any express warranty it
contended was breached, and failed to demonstrate that the merger clause contained in each of the
Agreements did not supersede any express warranty that might have been made. Accordingly,
Defendants’ JMOL with regard to Plaintiff’s Breach of Express Warranty claims was GRANTED.

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The parties have stipulated that Plaintiff’s contract with BASF is governed by New Jersey
law, whereas Plaintiff’s contract with FinishMaster is governed by Indiana law. See Advisory to the
Court (Clerk’s Docket No. 157). Plaintiff’s tort claims are governed by Texas law.
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D.

Damages for Injury to Business Reputation
RPBS failed to produce any evidence to support its claim that it suffered injury to its business

reputation among the general public. While it did introduce some evidence with regard to its alleged
injury to its reputation with insurance companies and their direct repair programs, it failed to present
any evidence or testimony that demonstrated its reputation was damaged in any other arena, and
specifically with the general public. Defendant’s JMOL on this issue was thus GRANTED IN
PART and DENIED IN PART.
E.

Plaintiff’s Fraud Claim
The elements of fraud under Texas law are: (1) that a material representation was made; (2)

the representation was false; (3) when the representation was made, the speaker knew it was false
or made it recklessly without any knowledge of the truth and as a positive assertion; (4) the speaker
made the representation with the intent that the other party should act upon it; (5) the party acted in
reliance on the representation; and (6) the party thereby suffered injury. Italian Cowboy Partners,
Ltd. v. Prudential Ins. Co. of America, 341 S.W.3d 323, 337 (Tex. 2011). The Court found that
Plaintiff introduced sufficient evidence and testimony to support or its fraud claim and claim for
punitive damages with regard to that claim. Accordingly, the Defendant’s JMOL with regard to
Plaintiff’s fraud claim was DENIED.
SIGNED this 12th day of September, 2012.

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ANDREW W. AUSTIN
UNITED STATES MAGISTRATE JUDGE

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