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.

CANADIAN PACIFIC RWY. v. WILLIAMS-HAYWARD PROT. COAT.

April 16, 2003

CANADIAN PACIFIC RAILWAY COMPANY, A CANADIAN CORPORATION, PLAINTIFF,
v.
WILLIAMS-HAYWARD PROTECTIVE COATINGS, INC., AN ILLINOIS CORPORATION, DEFENDANT.



The opinion of the court was delivered by: Amy J. St. Eve, United States District Judge

MEMORANDUM OPINION AND ORDER

Defendant has moved to dismiss the case pursuant to Rule 12(b)(7) for failure to join an indispensable party under Rule 19. Defendant also seeks to dismiss count four pursuant to Rule 9(b) and counts four, five and six pursuant to Rule 12(b)(6) for failure to state a claim. For the reasons set forth below, Defendant's motion is granted in part and denied in part.

BACKGROUND

Plaintiff Canadian Pacific Railway Company ("CP Rail") is a Canadian corporation with its principal place of business in Alberta, Canada. Defendant Williams-Hayward is an Illinois corporation engaged in the business of manufacturing paint. In 2000, CP Rail began to solicit bids from rail car manufacturers to manufacture 1000 rail cars. CP Rail intended to use 625 of these rail cars to carry large rolls of paper used in the publishing of newspapers (hereinafter referred to as the "Paper Cars"). National Steel Car, Ltd. ("NSC"), a rail car manufacturer, responded to CP Rail's solicitation and eventually received the contract for the Paper Cars.

On August 4, 2000, NSC submitted a bid proposal specifying that the interior of the Paper Cars would be painted with a waterborne thermalbond coating manufactured by Williams-Hayward. On September 1, 2000, NSC identify the the color and part number of the Williams-Hayward paint that was ultimately used to treat the interior of the Paper Cars. On September 7, 2000, CP Rail advised NSC that the Williams-Hayward paint identified by NSC was CP Rail's "paint preference." In December 2000, CP Rail awarded the Paper Car contract to NSC.

On June 21, 2001, CP Rail entered a purchase agreement with NSC for the manufacture and purchase of the Paper Cars. On approximately August 28, 2001, NSC identified a problem with the Williams-Hayward Thermalbond being applied to the interior of a sample car. Namely, NSC stated that paper fiber or particles from the paper being shipped were adhering to the paint surface on the interior walls, NSC thereafter informed both CP Rail and Defendant that the paint had failed the testing on the sample Paper Car. Defendant objected to the results of NSC's tests and asserted that the problems were with NSC's application of the paint. Defendant subsequently worked with NSC to remedy the problems with the Thermalbond paint. Nonetheless, Plaintiff alleges that stickiness problems persisted with the Williams-Hayward Thermalbond paint.

On December 7, 2001, CP Rail stopped accepting Paper Cars treated with Williams-Hayward Thermalbond. Plaintiff alleges that Defendant subsequently agreed to pay for the Papers Cars to be lined with cardboard to allow the Paper Cars to generate revenue. Plaintiff further alleges that Defendant later, for the first time, noted that the problems with the paint were accepted in the industry.

Plaintiff thereafter sued Williams-Hayward in a five count complaint based on diversity jurisdiction. Plaintiff's complaint contains the following claims: breach of warranty, breach of implied warranty of fitness, breach of implied warrant of merchantability, fraud, unjust enrichment and promissory estoppel. Plaintiff did not sue NSC in any of the counts in its complaint. Defendant argues that NSC is an indispensable party and seeks to dismiss the action for Plaintiff's failure to join NSC.

ANALYSIS

A. Rule 12(b)(7) — Indispensable Party

Rule 12(b)(7) provides for dismissal of an action where there is a "failure to join a party under Rule 19." Fed.R.Civ.P. 12(b)(7). In assessing a Rule 12(b)(7) motion to dismiss, the Court must apply a two step inquiry. Thomas v. United States, 189 F.3d 662, 666 (7th Cir. 1999). "First, the court must determine whether a party is one that should he joined if feasible. . . ." Id. This first step requires the court to analyze three factors: "(I) whether complete relief can be accorded among the parties to the lawsuit without joinder, (2) whether the absent person's ability to protect its interest in the subject-matter of the suit will be impaired, and (3) whether any existing parties might be subjected to a substantial risk of multiple or inconsistent obligations unless the absent person joins the suit." Id. (citing Fed.R.Civ.P. 19(a)). See also Davis Cos. v. Emerald Casino, Inc., 268 F.3d 477, 481 (7th Cir. 2001). "Only if the court concludes . . . that the party should be included in the action but it cannot be, must it go on to decide whether the litigation can proceed at all in the party's absence." Thomas, 189 F.3d at 666; Fed.R.Civ.P. 19(b) "If there is no way to structure a judgment in the absence of the party that will protect both the party's own rights and the rights of the existing litigants, the unavailable party is regarded as `indispensable' and the action is subject to dismissal . . . under Federal Rule of Civil Procedure 12(b)(7)." Id.

Defendant argues that NSC is an indispensable party under Rule 19 because: (1) in NSC's absence, complete relief cannot be accorded among the parties and (2) NSC has an interest relating to the subject of this case and is so situated that the disposition of the case may (a) as a practical matter impair or impede its ability to protect that interest or (6) leave Defendant subject to a substantial risk of incurring inconsistent obligations. Defendant argues that it contracted with NSC to provide the paint for the Paper Cars in this case, not with Plaintiff Williams-Hayward contends that it never had an express contract with Plaintiff regarding the Paper Cars, thus NSC is a necessary party. CP Rail, Defendant argues, is a third party beneficiary of the contractual relationship between NSC and Defendant.

In support of its motion, Defendant attaches the affidavit of Wayne E. Kurez (the "Kurez Affidavit"), an officer of Williams-Hayward. In deciding a case under Rule 12(b)(7), the Court may review materials submitted outside of the pleadings and consider extrinsic evidence. Davis Cos. v. Emerald Casino, Inc., 268 F.3d 477, 480 n. 4. (7th Cir. 2001) (citations omitted). The Kurez Affidavit confirms that Williams-Hayward provided paint to NSC. Kurez states that Williams-Hayward provided the paint "in response to certain purchase orders it received from" NSC. (Kurez Affidavit ¶ 2.) Kurez is "informed and believe[s] that the paint supplied to [NW] by Williams-Hayward . . . was used by [NSC] in the course of manufacturing certain box cars for" CP Rail. (Id. ¶ 3.) Kurez also noted that Williams-Hayward has not been paid for this paint. (Id. ¶ 4.)

Plaintiff counters that NSC is not indispensable because the complaint alleges that a direct contract existed between Plaintiff and Defendant. It also argues that Defendant has failed to make the requisite ...


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.