Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Horn & Hardart Co. v. Pillsbury Co.

decided: October 17, 1989.

THE HORN & HARDART COMPANY, PLAINTIFF-APPELLANT,
v.
THE PILLSBURY COMPANY, DEFENDANT-APPELLEE



Appeal from judgment granting defendant-appellee's motion for summary judgment entered in the United States District Court of the Southern District of New York (Whitman Knapp, Judge), dismissing plaintiff-appellant's complaint for breach of contract for failure to comply with the New York Statute of Frauds, N.Y.U.C.C. § 1-206(1) (McKinney 1964). Affirmed.

Pratt, Miner, and Altimari, Circuit Judges.

Author: Altimari

ALTIMARI, Circuit Judge

The central question presented by this appeal is to what extent, if any, parol evidence may be employed to connect signed and unsigned writings to satisfy the New York Statute of Frauds, N.Y.U.C.C. § 1-206(1) (McKinney 1964) ("Statute of Frauds"). Plaintiff-appellant Horn & Hardart Company ("Horn & Hardart") appeals from a judgment entered in the United States District Court for the Southern District of New York (Whitman Knapp, Judge) granting defendant-appellee Pillsbury Company's ("Pillsbury") motion for summary judgment under Fed.R.Civ.P. 56(b). Horn & Hardart Co. v. Pillsbury Co., 703 F. Supp. 1062 (S.D.N.Y. 1989). Horn & Hardart sought to recover damages it allegedly sustained as a result of Pillsbury's breach of an oral agreement. In Horn & Hardart's view, the oral agreement required Horn & Hardart to forbear from efforts to acquire Diversifoods, Inc. ("Diversifoods"), allowing Pillsbury to acquire Diversifoods. In exchange, Pillsbury would sell certain assets of Diversifoods to Horn & Hardart at a favorable price following Pillsbury's acquisition of Diversifoods. The district court found, however, that the alleged oral contract was unenforceable under the Statute of Frauds. On this appeal, as in the district court, Horn & Hardart argues that a signed letter from the President of Pillsbury to Pillsbury's Board of Directors and various unsigned internal memoranda of Pillsbury, connected by parol evidence, may be read together to satisfy the Statute of Frauds. In addition, Horn & Hardart contends that the district court erred in affirming the magistrate's denial of its motion to discover written notes made by Pillsbury's General Counsel concerning the alleged oral agreement. For the reasons set forth below, we affirm the judgment of the district court.

BACKGROUND

In April 1985, Horn & Hardart initiated negotiations with Diversifoods, the largest U.S. franchise of Burger King restaurants, concerning a possible acquisition of Diversifoods. Pillsbury, the corporate parent of Burger King, was also interest in acquiring Diversifoods and, in early May 1985, Pillsbury approached Horn & Hardart to discuss their mutual acquisition plans.

At a meeting attended by senior management of Pillsbury and Horn & Hardart, Pillsbury proposed a "standstill agreement." It appears undisputed that under the terms of the proposal, Horn & Hardart would refrain from further efforts to acquire Diversifoods, allowing Pillsbury to complete its acquisition of Diversifoods. In return, Pillsbury proposed to sell several of Diversifoods' non-Burger King assets to Horn & Hardart at a price well below fair market value. Negotiations proceeded over a two-day period. The ground rules for these negotiations are in dispute. Pillsbury alleges that the parties each promised to suspend further discussions with Diversifoods while they attempted to reach an agreement. Horn & Hardart denies the existence of such negotiation ground rules, contending that a standstill agreement was only part of the overall agreement it seeks to enforce.

Negotiations were abruptly halted on May 15, 1985, when Pillsbury learned that investment bankers representing Horn & Hardart and Diversifoods had entered into discussions earlier that day. Pillsbury considered such discussions a breach of the established ground rules. As a result, Pillsbury terminated its discussions with Horn & Hardart. Two days later, John Stafford, Pillsbury's President, sent a signed letter to each member of Pillsbury's Board of Directors (the "Stafford letter"). The Stafford letter notified the Board of a special meeting to discuss efforts to acquire Diversifoods. The letter recounted various measures previously undertaken by Pillsbury and suggested additional steps to pursue the acquisition. In this context, the letter made reference to "our verbal agreement" with Horn & Hardart.

On May 18, 1985, Pillsbury and Diversifoods entered into a merger agreement, which was subsequently approved by the boards of directors of Pillsbury and Diversifoods, respectively.

Horn & Hardart commenced the underlying action in the district court on July 17, 1985. It alleged that the preliminary discussions held on May 14 had, in fact, resulted in an enforceable oral agreement. To overcome the Statute of Frauds defense, Horn & Hardart offered the Stafford letter and various unsigned internal memoranda of Pillsbury. In preparing for trial, Horn & Hardart sought to discover notes concerning the May 14 meeting between Pillsbury and Horn & Hardart prepared by Edward C. Stringer, the General Counsel of Pillsbury. Stringer, who did not attend that meeting, made notes based on his discussions with Pillsbury representatives present at that meeting. The district court found the notes to be attorney work product and affirmed the magistrate's decision denying Horn & Hardart's discovery motion. The district court also determined that the combination of the Stafford letter and unsigned internal memoranda offered by Horn & Hardart could not, as a matter of law, satisfy the Statute of Frauds. Accordingly, the district court granted Pillsbury's motion for summary judgment.

Discussion

A. The Statute of Frauds.

On this appeal, as in the district court, Horn & Hardart contends that the Stafford letter and various unsigned internal memoranda, connected to the Stafford letter by parol evidence, satisfy the New York Statute of Frauds. We disagree.

Review of a grant of summary judgment focuses on whether the district court properly concluded that there was "no genuine issue as to any material fact," thereby entitling the moving party to "judgment as a matter of law." Fed.R.Civ.P. 56(c). "Summary judgment is appropriate when, after drawing all reasonable inferences in favor of the party against whom summary judgment is sought, no reasonable trier of fact could find in favor of the non-moving party." Murray v. National Broadcasting Co., 844 F.2d 988, 992 (2d Cir.), cert. denied, 488 U.S. 955, 109 ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.