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Cadco, Ltd. v. Doctor's Associates, Inc.

Court of Appeals of Connecticut

March 5, 2019


          Argued November 14, 2018

         Procedural History

         Action to recover damages for, inter alia, unfair trade practices, and for other relief, brought to the Superior Court in the judicial district of Litchfield, where the court, Pickard, J., granted the plaintiff's motion to cite in additional parties; thereafter, the matter was transferred to the judicial district of Hartford, Complex Litigation Docket; subsequently, the court, Moukawsher, J., granted the defendants' motions for summary judgment and rendered judgment thereon, from which the plaintiff appealed to this court. Affirmed.

          Patrick E. Power, for the appellant (plaintiff).

          Jeffrey R. Babbin, with whom were David R. Roth and, on the brief, John M. Doroghazi, for the appellees (named defendant et al.).

          Matthew W. Buttrick, pro hac vice, with whom was David T. Martin, for the appellee (defendant Independent Purchasing Cooperative, Inc.).

          Sheldon, Elgo and Flynn, Js.


          SHELDON, J.

         The plaintiff, Cadco, Ltd., commenced this action alleging that the defendants, Doctor's Associates, Inc. (Doctor's Associates), Franchise World Headquarters, LLC (Franchise), and Independent Purchasing Cooperative, Inc. (Independent), engaged in unfair acts or practices and unfair methods of competition and deceptive acts or practices in their business dealings with the plaintiff concerning the design and development of a new product in violation of the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq., and that in so doing they unjustly enriched themselves to the plaintiff's detriment. The plaintiff appeals from the summary judgment rendered in favor of the defendants on its complaint. We conclude that the trial court properly determined that the defendants were entitled to summary judgment on each of the plaintiff's claims against them because they established that there was no genuine issue of material fact that the plaintiff had no right to prevail on any of those claims. Accordingly, we affirm the judgment of the trial court.

         The following facts are undisputed. In February, 2012, representatives from Doctor's Associates, the franchisor of the Subway restaurant chain in the United States, and Franchise, a corporation that provides administrative services to Doctor's Associates, approached the plaintiff about purchasing a standard flat metal heating plate that the plaintiff manufactured. The plate was to be considered for use in Subway restaurants to cook a new flat bread pizza product called the ‘‘Flatizza.'' As a result of this meeting, the plaintiff provided one of its standard heating plates to Doctor's Associates for testing at Subway headquarters. Doctor's Associates also requested that the plaintiff sign a nondisclosure agreement to protect various details about its business practices, which the plaintiff signed on February 27, 2012.

         During the course of testing, representatives from Franchise notified the plaintiff that problems had arisen with using the plaintiff's standard plate to cook the Flatizzas. Thereafter, between April, 2012, and September, 2012, the plaintiff made numerous changes to its standard heating plate to address those problems, creating six different versions of the plate for the defendants to test. In its correspondence with defendants Doctor's Associates and Franchise concerning the changes that had been made to the plates, the plaintiff shared detailed technical information about its design. By the end of the testing period, Doctor's Associates had purchased a total of 133 heating plates from the plaintiff. Subway's primary oven manufacturer, TurboChef, ultimately approved the fifth version of the modified heating plate for use in its ovens in Subway restaurants. Subway then began to test market the Flatizza in several cities across the country to determine if it should offer the new product nationally. To facilitate such market testing, Doctor's Associates purchased 1, 728 of the modified heating plates from the plaintiff, in eight separate orders from May, 2012 through February, 2013.

         On June 4, 2012, a meeting was held between several the plaintiff representatives and representatives from Doctor's Associates and Franchise. At that meeting, the plaintiff was informed that if Subway's management decided to offer the Flatizza throughout the country, it would aim to distribute the modified heating plates to its franchisees in March, 2013, and thus the plaintiff would be expected to begin production of the new plates in October, 2012, after the plaintiff and Independent, Subway's purchasing arm, determined the pricing for the ‘‘full production rollout.'' The plaintiff e-mailed representatives of Doctor's Associates and Franchise on June 7, 2012, to memorialize the June 4 meeting, but received no response. The defendants later decided to delay the March, 2013 rollout of the Flatizza.

         From March, 2013 through September, 2013, the defendants continued to update the plaintiff regarding the Flatizza project and to gather information from the plaintiff regarding its production capabilities for the new plates, the process by which it would seek national public health and safety approval for them, and its updates to its proposal for pricing the plates' production. On March 25, 2013, Ed Degnan, an equipment specialist for Franchise, requested a detailed production timeline and cost information from the plaintiff for an order of 16, 000 plates, but he cautioned in an e-mail the following day: ‘‘To be clear, this is exploratory only [and] not an order. DO NOT ORDER ANY MATERIALS.'' In April, 2013, Franchise informed the plaintiff, in another e-mail, that it was working with four different vendors on the project. On May 31, 2013, Tricia Hetherington, the director of new product development for Franchise, e-mailed the plaintiff, stating that she would ‘‘like to explore how we could be ready for a potential February, 2014 launch of Flatizza.''

         On July 10, 2013, the plaintiff e-mailed a representative from Independent to confirm the details of a recent phone call between itself and Independent concerning the need for a production timeline and pricing for 22, 000 of the new plates, Subway's intent to roll out the Flatizza in its restaurants in February, 2014, and, to that end, its need to have all of the new plates delivered to a warehouse in Massachusetts for that purpose by December 20, 2013, and for the plaintiff to commit to filling the order no later than September 1, 2013. In response to that e-mail, the Independent representative stated that, although the plaintiff's summary of the phone call was accurate, ‘‘[m]uch on our end is not firm, so please await further information . . . .''

         At the same time, there was uncertainty as to whether Merrychef, the manufacturer of a different oven used in certain Subway restaurants as an alternative to the TurboChef oven, would make its own heating plates for use in its ovens to cook Flatizzas rather than using plates manufactured by the plaintiff. Thereafter, on July 10, 2013, Independent asked the plaintiff to inform it of ‘‘the impact of an additional 7000 Merrychef style plates should we add these to the order.'' On July 18, 2013, Franchise sent an e-mail to the plaintiff with the subject line ‘‘Pizza Plate Bid Information.'' That e-mail read: ‘‘Do you guys have any questions on this bid? I have notified my Merrychef rep that if you guys are approved to manufacture both plates then Merrychef will need to approve your plate in their oven. I would then send one of the [two] Merrychef plates you sent me to Merrychef for approvals.'' This was the first and only documented mention to the plaintiff by any defendant that the choice of manufacturer for the new heating plates, if they were ordered, would be made through a bidding process. Later that evening, Franchise e-mailed the plaintiff that it ‘‘looks like you are ready to [go] if we give you the go ahead.''

         On August 1, 2013, Independent e-mailed the plaintiff to verify the production timeline information for a presentation by Franchise and Independent to ‘‘the leadership, '' so that the leadership could ‘‘understand the timing of the decision required.'' On August 16, 2013, the plaintiff e-mailed Independent to confirm a quote for the heating plates of $67.27 per unit. On September 13, 2013, Degnan informed the plaintiff that there were no new updates on the Flatizza project and that he would not expect any decisions that year. The final e-mail exchange between Franchise and the plaintiff occurred on September 23, 2013, when the plaintiff asked Franchise to ‘‘go over a few things'' over the telephone and Franchise ...

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