United States District Court, W.D. Arkansas, Fayetteville Division
LEONETTI'S FROZEN FOODS, INC. PLAINTIFF
CREW, INC. d/b/a REW MARKETING, INC. DEFENDANT
MEMORANDUM OPINION AND ORDER
TIMOTHY L. BROOKS UNITED STATES DISTRICT JUDGE
before the Court are Defendant Crew, Inc.'s
("Crew") Motion for Summary Judgment (Doc. 30),
Statement of Facts in Support (Doc. 31), and Brief in Support
(Doc. 32); Plaintiff Leonetti's Frozen Foods, Inc.'s
("Leonetti's") Response to Statement of Facts
(Doc. 33), Statement of Disputed Facts in Opposition (Doc.
34), and Memorandum of Law in Opposition (Doc. 35); and
Crew's Reply Brief in Support (Doc. 37). For the reasons
given below, Crew's Motion for Summary Judgment is
GRANTED IN PART AND DENIED IN PART.
is a Pennsylvania manufacturer of frozen food products, who
hired Crew as a broker in August 2014 to market and sell a
couple of frozen stromboli products to Sam's Club, a
national membership-only warehouse store. One of those
products, "Leonetti's Frozen Stromboli, " would
be for consumers to purchase and take home from Sam's
Club frozen-food sections; the other product, "Cafe
Stromboli, " would be for consumers to purchase and
consume on-site at Sam's Club cafes. At the time
Leonetti's hired Crew to manage its Sam's Club
account, Crew had already been managing the Leonetti's
account with Costco-a competitor of Sam's Club-for
roughly seven months.
August 2014 through January 2015, Leonetti's worked to
develop Cafe Stromboli, and underwent the testing and
approval process for both products, in an effort to meet
Sam's Club's specifications. On January 14, 2015, a
"hold test" was conducted, in which "the
stromboli is cooked and then placed under heat lamps for 1
hour to ensure that the stromboli holds its internal
temperature." (Doc. 8, ¶¶ 49-50). Later that
day, Crew's Chief Operating Officer, Cindy Towler,
see Doc. 30-1, p. 2, sent the following email to
various employees of Sam's Club who were participating in
John and Jeremy good day! I completed the in-club testing
this morning at the Bentonville Sam's Club. Test went
extremely well. I used 8 Stromboli's in the test. The
additional samples were used to determine where to start the
pans as the temperature and times were not set at 485* - 6
minutes. The ovens were set at 500* - 6:30, club associate
said they started the pizzas at the entrance of the oven and
recommended we do the same. I found that the top oven cooked
hotter than the 2nd and 3rd oven. While the top oven did not
burn the Stromboli they were a little darker than we like to
Attached is a recap of the testing.
Please let me know if you have any questions and what our
next steps will be.
(Doc. 30-4, p. 2).
that evening, Crew's President, Jeff Campigli,
see Doc. 30-1, p. 3, sent a reply-all email that
stated "Nice job Cindy. Robert and I could even use
slides 2-5 in our Costco Presentation next week:), "
(Doc. 30-4, p. 2). The next morning, after being alerted that
he had inadvertently sent the email as a reply-all rather
than solely to Ms. Towler, Mr. Campigli sent Sam's Club a
follow-up email profusely apologizing, explaining that his
email "was a very poor attempt at humor and meant for
Cindy only, " and assuring Sam's Club that Crew
"would never share testing, conducted exclusively for
you, with any customer... especially your #1
competitor." See id. at 1. A few weeks later on
February 3, John Hawthorne from Sam's Club informed Ms.
Towler that it would not be purchasing frozen food from
Leonetti's because temperature inconsistencies rendered
it "an unacceptable product to put in front of the
Members." See Doc. 30-5, p. 1.
7, 2015, Leonetti's filed a complaint against Crew in the
Philadelphia County Court of Common Pleas, which Crew removed
to the United States District Court for the Eastern District
of Pennsylvania on July 29, 2015. On September 30 of that
same year, that Court ordered venue transferred to the United
States District Court for the Western District of Arkansas.
In its First Amended Complaint, (Doc. 8), Leonetti's
brings four claims against Crew-for negligence, breach of
contract, breach of fiduciary duty, and trade libel-all of
which are premised on the factual allegation that Mr.
Campigli's email caused Sam's Club to decide not to
purchase any Leonetti's products. See Doc. 30-2,
p. 8. Crew has moved for summary judgment on all four of
Leonetti's claims, arguing there is no genuine dispute
that Mr. Campigli's email was not the proximate cause of
Sam's Club's decision not to purchase Leonetti's
products. Naturally, Leonetti's opposes this Motion. The
Motion has been fully briefed and is ripe for decision.
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). The Court must view the facts in the
light most favorable to the non-moving party, and give the
non-moving party the benefit of any logical inferences that
can be drawn from the facts. Canada v. Union Elec.
Co.,135 F.3d 1211, 1212-13 (8th Cir. 1997). The moving
party, Crew, bears the burden of proving the absence of any
material factual disputes. Fed.R.Civ.P. 56(c); Matsushita
Elec. Indus. Co. v. Zenith Radio Corp.,475 U.S. 574,
586-87 (1986); Nat'l Bank of Commerce of El Dorado,
Ark. v. Dow Chem. Co.,165 F.3d 602 (8th Cir. 1999). If
Crew meets this burden, then Leonetti's must "come
forward with 'specific facts showing that there is a
genuine issue for trial.'" Matsushita, 475
U.S. at 587 (quoting Fed.R.Civ.P. 56(c)). These specific