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CONRAD v. VACUUM INSTRUMENT CORPORATION

October 6, 2004.

ALAN C. CONRAD and ELECTRONIC PRODUCTION AND MONITORING, INC., Plaintiffs,
v.
VACUUM INSTRUMENT CORPORATION, Defendant.



The opinion of the court was delivered by: JOHN W. DARRAH, District Judge

MEMORANDUM OPINION AND ORDER

Plaintiffs, Alan C. Conrad and Electronic Production and Monitoring, Inc., filed suit against Defendant, Vacuum Instrument Corporation. Plaintiffs allege that Defendant failed to honor a contract requiring Defendant to pay commissions on products sold within Conrad's geographical sales area. Presently before the Court is Defendant's Motion for Summary Judgment and Plaintiffs' Cross-Motion for Summary Judgment. Plaintiffs have also filed a Motion for Leave to Amend the Complaint, which seeks to make a technical change to the Complaint and add a claim for an accounting.

LEGAL STANDARD

  Summary judgment is appropriate when no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Cincinnati Ins. Co. v. Flanders Elec. Motor Serv., Inc., 40 F.3d 146, 150 (7th Cir. 1994). "One of the principal purposes of the summary judgment rule is to isolate and dispose of factually unsupported claims or defenses. . . ." Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Thus, although the moving party on a motion for summary judgment is responsible for demonstrating to the court why there is no genuine issue of material fact, the non-moving party must go beyond the face of the pleadings, affidavits, depositions, answers to interrogatories, and admissions on file to demonstrate, through specific evidence, that a genuine issue of material fact exists and to show that a rational jury could return a verdict in the non-moving party's favor. Celotex, 477 U.S. at 322-27; Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 254-56 (1986); Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986); Waldridge v. American Hoechst Corp., 24 F.3d 918, 923 (7th Cir. 1994).

  Disputed facts are material when they might affect the outcome of the suit. First Ind. Bank v. Baker, 957 F.2d 506, 507-08 (7th Cir. 1992). When reviewing a motion for summary judgment, a court must view all inferences to be drawn from the facts in the light most favorable to the opposing party. Anderson, 477 U.S. at 247-48; Popovits v. Circuit City Stores, Inc., 185 F.3d 726, 731 (7th Cir. 1999). However, a metaphysical doubt will not suffice. Matsushita, 475 U.S. at 586. If the evidence is merely colorable or is not significantly probative or is no more than a scintilla, summary judgment may be granted. Anderson, 477 U.S. at 249-250.

  BACKGROUND

  The undisputed facts, for the purposes of this motion, taken from the parties' Local Rule 56.1(a) & (b) statements of material facts (referred to herein as "Pl.'s 56.1" and "Def's 56.1") and exhibits, are as follows.

  Defendant makes and sells industrial leak-detection systems that other manufacturers use to test for leaks in the manufacturers' finished products. Def.'s 56.1 ¶ 4. Independent sales representatives, such as Conrad, sell Defendant's systems to industrial customers throughout the country. Def.'s 56.1 ¶ 5.

  Pursuant to a Sales Representative Agreement, Defendant gave Plaintiffs a designated geographical area to sell the leak-detection systems. Def.'s 56.1 ¶¶ 8-9. The agreement provided that Conrad would be credited with all sales emanating from his territory and that Conrad would receive commissions for sales based on a number of factors. Pl.'s 56.1 ¶ 3; Def.'s 56.1 ¶¶ 12-14. Conrad was eligible to receive commissions for systems, spare parts, and customer add-ons that Defendant bought from a third-party. Def.'s 56.1 ¶ 13. The agreement also provided that it could be terminated by either party with thirty-days' written notice. Def.'s 56.1 ¶ 11.

  In Count I, Conrad seeks to recover commissions for sales of leak-detection systems sold by Defendant in Conrad's territory. In the 1990s, Defendant made a number of sales to companies in Conrad's territory; and Conrad did not receive full — or any — commissions on these sales. Def.'s 56.1 ¶¶ 24, 25, 29-32, 36-39. Although Conrad was aware of the sales and considered the failure to pay commissions a breach of the Sales Representative Agreement, Conrad continued working for Defendant and did not terminate the sales agreement. Def.'s 56.1 ¶¶ 23, 25-27, 33-35, 45.

  In Count II, Conrad seeks to recover "shared commissions," which represent partial commissions Conrad agreed to accept, on certain leak-detection systems sold by Defendant. Def.'s 56.1 ¶ 40. In Count III, Conrad seeks commission for spare parts sold by Defendant in Conrad's sales territory. Def.'s 56.1 ¶ 46.

  On November 15, 2001, the Sales Representative Agreement terminated. Def.'s 56.1 ¶ 21. ANALYSIS

  Summary Judgment Motions

  Both Defendant and Plaintiffs move for summary judgment. Defendant contends that Conrad waived his right to commissions when he continued to perform under the Sales Representative Agreement. Specifically, although Conrad was aware that Defendant made sales in his territory and that he would not receive credit or full commissions on those sales, Conrad still continued to perform under the agreement. Defendant also argues that Plaintiffs' evidence relating to the breach of contract is speculative. Finally, Defendant seeks summary judgment on Count IV, ...


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