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.

PREMIER TRANSPORT, LTD. v. NEXTEL COMMUNICATIONS

May 30, 2003

PREMIER TRANSPORT, LTD., D/B/A PREMIER MESSENGER, LTD., AN ILLINOIS CORPORATION, PLAINTIFF, VS. NEXTEL COMMUNICATIONS, INC., A DELAWARE CORPORATION; AND NEXTEL WEST CORP., A DELAWARE CORPORATION, DEFENDANTS.


The opinion of the court was delivered by: Sidney Schenkier, Magistrate Judge

MEMORANDUM OPINION AND ORDER*fn1

In this diversity action, the plaintiff, Premier Transport, Ltd. ("Premier"), asserts claims under Illinois law for statutory fraud (Count I), common law fraud (Count II), and breach of contract (Count III) arising out of disputes between Premier and the defendants (which we refer to collectively as "Nextel") in connection with defendants' provision to Premier of wireless communication services. In an earlier opinion, this Court dismissed additional claims that Premier had asserted alleging tortious interference with contract and with prospective economic advantage, and denied Premier's motion to amend those claims. Premier Transport, Ltd. v. Nextel Communications, Inc., No. 02 C 4536, 2002 WL 31507167 (N.D. Ill. Nov. 12, 2002).

Now pending before the Court is Nextel's motion, pursuant to Federal Rule of Civil Procedure 16(c)(1), to further narrow the issues in the case by barring Premier from seeking consequential damages or economic losses (doc. #28). Nextel offers two bases for its motion: (1) there are no allegations in the claims that remain in this case (Counts I-III)for which consequential damages can be awarded; and (2) in any event, Premier signed the underlying agreements between the parties, which all contained exculpatory clauses that bar Premier from asserting any right to recover consequential damages and economic losses against Nextel. For the reasons that follow, the Court grants Nextel's Rule 16 motion to bar Premier from asserting any claims for consequential damages based on Counts I-III.

I.

We begin by summarizing the claims for relief that Premier asserts. In Count I of the First Amended Complaint, Premier alleges that Nextel engaged in conduct that violates the Illinois Consumer Fraud and Deceptive Trade Practices Act, 815 ILCS 505/1 et seq. (Compl. ¶ 47). Specifically, Premier complains that Nextel knowingly deceived Premier regarding the costs and charges involved in the sale of certain telephone services and "intended to induce Premier to rely on Nextel's deception." In Count II, Premier alleges that Nextel engaged in common law fraud. Specifically, Premier alleges that Nextel "made several misrepresentations to induce Premier to purchase equipment on a communication system that Nextel knew was going to be obsolete" and represented to Premier that it would be charged a reduced fee for deactivated wireless telephones" (Compl. ¶ 53), even though it later continued to charge Premier the full rate for such telephones and services, failed to credit Premier's account (as it represented it would do), and made numerous other misrepresentations to Premier to "induce Premier to continue its relationship with Nextel" and to continue to purchase wireless telephones and communication service from Nextel" (Compl. ¶¶ 53-54). Finally, in Count III, Premier alleges that Nextel breached its contract with Premier when it charged "Premier for different services and fees than were agreed to by the [p]arties" (Compl. ¶ 61).

Each of these three counts incorporate by reference the first 40 paragraphs of the complaint. One of those paragraphs alleges that Nextel terminated Premier's service, which caused Premier to expend some $80,000 to implement a new wireless communication, and that Premier thereafter lost existing and prospective clients because the replacement system was inferior to that offered by Nextel (Compl. ¶ 40). In discovery, Premier disclosed that it claims more than $800,000 in damages for the lost business and some $168,000 for the cost of establishing a service to replace that offered by Nextel (Premier's Second Supplemental Objections and Answers to Defendants' First Set of Interrogatories, No. 5). By contrast, the total amount of other damages that Nextel based on Nextel's alleged pre-termination conduct is about $74,000 (Id.).*fn2

II.

Rule 16(c)(1) allows a district court to "take appropriate action, with respect to the formulation and simplification of the issues. . . ." Fed.R.Civ.P. 16(c)(1). The Advisory Committee Notes to Rule 16 further explain:

The reference in Rule 16(c)(1) to "formulation" is intended to clarify and confirm the court's power to identify litigable issues. It has been added in the hope of promoting efficiency and conserving judicial resources by identifying the real issues prior to trial, thereby saving time and expense for everyone. The notion is emphasized by expressly authorizing the elimination of frivolous claims or defenses at a pretrial conference. There is no reason to require that this await a formal motion for summary judgment. . . .
Fed.R.Civ.P. 16(c)(1), Advisory Committee Notes, Discussion, Subdivision (c) (citations omitted).

As Premier correctly notes (Premier's Resp. at 4, n. 1), the present Rule 16 motion is like a motion for partial summary judgment because it seeks dismissal of Premier's consequential damages claim for Counts I-III. And, in fact, Premier has treated the motion as such, citing the standards applicable to summary judgment motions and offering extrinsic evidence to show why there are material facts that are in genuine dispute on the issue of consequential damages. The discovery relevant to consideration of this motion has been completed, and the parties have had an opportunity to submit all evidence and arguments within their disposal on this issue. The Court therefore will treat the present Rule 16 motion as a motion for partial summary judgment under Rule 56, even though the local rules governing the brief of summary judgment motions rules have not been strictly complied with in this particular instance.*fn3

Rule 56 requires that summary judgment be entered "only when the pleadings, depositions, affidavits, and admissions filed in the case "show that . . . there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.'" Fed.R.Civ.P. 56(c). A genuine issue of material fact exists if there is evidence that would support the entry of verdict in the non-moving party's favor. Anderson v. Liberty Lobby, Inc., 447 U.S. 242, 249 (1986). To determine if such material facts are genuinely disputed, the reviewing court must view the evidence in the light most favorable to the non-moving party and resolve all doubts in that party's favor. Id. at 245-50. The moving party has the burden of identifying the material facts which are without genuine dispute and support the entry of summary judgment in the moving party's favor. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The non-moving party, for its part, must identify which material facts raise genuine issues of dispute. Id. at 324.

III.

Here, the only issue presented is whether based on Counts I, II or III of the First Amended Complaint, Premier has a triable claim for consequential damages. As indicated above, Nextel argues that the Court must dismiss Premier's consequential damage claims from this case because: (1) there is an exculpatory clause that bars consequential damages in the written subscriber agreements between the parties; and (2) irrespective of any exculpatory clause, Counts I-III cannot support a claim for post-termination consequential damages, since those counts "relate only to alleged improper charges for wireless services" and do not assert as fraudulent or a breach of contract the termination of service (Nextel Mot. at 6, ¶ 17).

In response, Premier uses most of its ink to attack the exculpatory clause. Premier claims that the exculpatory clause is unenforceable for several reasons: (1) Nextel allegedly is a monopoly; (2) even if it is not a monopoly, Nextel is a common carrier; and (3) public policy augers against enforcement of the exculpatory clause in this case. Premier then briefly, in two short paragraphs not even a page long, addresses Nextel's argument that Count I-III fail to allege any claim for which consequential damages can be recovered. Premier's only rejoinder to Nextel on this point is that "Nextel's termination of service was directly caused by Nextel's fraudulent charges" (Premier's Resp. at 9). In support of this argument, Premier cites to paragraph 40 of the complaint (incorporated into each of the three counts), which alleges that the new wireless communication system that Premier had to obtain after Nextel's ...


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.