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Hogan Logistics, Inc. v. Davis Transfer Company, Inc.

United States District Court, E.D. Missouri, Eastern Division

January 9, 2018

HOGAN LOGISTICS, INC., Plaintiff,
v.
DAVIS TRANSFER COMPANY, INC., Defendant.

          MEMORANDUM AND ORDER

          CHARLES A. SHAW UNITED STATES DISTRICT JUDGE

         This diversity matter is before the Court on defendant Davis Transfer Company, Inc.'s (“Davis”) motion for summary judgment. Plaintiff Hogan Logistics, Inc. (“Hogan”) opposes the motion and it is fully briefed and ready for decision. Hogan filed suit against Davis in state court asserting claims for breach of contract (Count I), breach of the implied duty of good faith and fair dealing (Count II), and tortious interference (Count III). Davis removed the case to this Court based on diversity of citizenship jurisdiction pursuant to 28 U.S.C. § 1332(a). Following removal, Hogan filed an Amended Complaint (Doc. 39) and later dismissed its claims in Counts II and III without prejudice (Doc. 75). Only the breach of contract claim in Count I remains pending. For the following reasons, Davis's motion for summary judgment will be denied.

         I. Legal Standard

         The Eighth Circuit has articulated the appropriate standard for consideration of motions for summary judgment as follows:

Summary judgment is proper if the pleadings, the discovery 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. The movant bears the initial responsibility of informing the district court of the basis for its motion, and must identify those portions of the record which it believes demonstrate the absence of a genuine issue of material fact. If the movant does so, the nonmovant must respond by submitting evidentiary materials that set out specific facts showing that there is a genuine issue for trial. On a motion for summary judgment, facts must be viewed in the light most favorable to the nonmoving party only if there is a genuine dispute as to those facts. Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge. The nonmovant must do more than simply show that there is some metaphysical doubt as to the material facts, and must come forward with specific facts showing that there is a genuine issue for trial. Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for trial.

Torgerson v. City of Rochester, 643 F.3d 1031, 1043 (8th Cir. 2011) (en banc) (internal citations and quotation marks omitted).

         II. Facts

         Plaintiff Hogan is a freight broker and third-party logistics company that provides nationwide shipping services for its customers, which at one time included Imperial Sugar Company (“ISC”). Hogan contracts with motor freight carriers, such as defendant Davis, to complete the actual transport of its customers' goods.

         Prior to July 2009, ISC hired Davis and others to transport cargo from its Port Wentworth and Savannah, Georgia warehouses. Davis hauled more than 1, 900 ISC shipments in ISC's 2008 fiscal year. In 2009, ISC discontinued its direct employment of motor carriers, and instead decided to contract with Hogan to arrange for all motor carrier transportation of cargo from its Port Wentworth and Savannah warehouses. ISC suggested that Davis bid for the transportation business to be brokered exclusively by Hogan, and Hogan subsequently awarded Davis ISC's cargo shipments to destinations in several southern statutes. Davis had previously hauled ISC's cargo to each of these destinations.

         In conjunction with the award of the ISC business in 2009, Hogan sent Davis and other carriers its standard Broker-Carrier Agreement, which included a Traffic Solicitation clause at paragraph 10. The parties refer to the Traffic Solicitation clause as a “back-solicitation” clause. On July 15, 2009, Hogan's Director of Logistics, Ben Strickler, sent all carriers an email advising that it had revised the Broker-Carrier Agreement, including by revising the terms of the back-solicitation clause, and informed them they must sign and submit the revised updated version by July 20, 2009.

         Davis's president Todd Davis replied to Strickler's email, inquiring about the back-solicitation clause:

On the back solicitation part; as we were a carrier for Imperial prior to our relationship, if they ever decided to switch from Hogan, would this affect our ability to do business? I know this is a bit technical, but it is probably something we would need to clarify. I am sure Hogan would do the same if you all were in our position.

         Strickler responded:

My understanding of the back solicitation involved customers we are currently doing business with. If they moved on from Hogan they wouldn't be a current customer[.]

         Davis replied:

Ok, if we can just get this clarified, obviously a company the size of Hogan and/or Davis we would have mutual customers and would see new customers, but I would never solicit a customer where I am doing business. Imperial is a bit different since we were a customer of Imperial prior to being a customer of Hogan.
Also on the [I]mperial business we need to make sure that it is noted that we were a customer of Imperial prior to being a customer of Hogan so we are never in a situation where there would be a back sale if Imperial decided to call me about doing business.
Can we get something drawn up on ...

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