Antitrust Law Daily Wrap Up, FRANCHISING & DISTRIBUTION—E.D. N.C: Decision allowing wrongful termination claim to proceed not reconsidered, (May 29, 2015)

By Edward L. Puzzo, J.D.

The federal district court in Raleigh, North Carolina has found an insufficient basis for reconsidering its earlier ruling, permitting an independent Bimbo bakery distributor to maintain claims that his termination was pretextual and in retaliation for his vocal opposition to Bimbo’s change in its margin policies (Ramsey v. Bimbo Foods Bakeries Order Distribution, LLC, May 28, 2015, Britt, W.).

On March 24, 2015, this court found that a genuine issue of material fact existed as to whether Bimbo’s stated reason for terminating Ramsey’s distribution agreement was a mere pretext for retaliating against Ramsey for his participation in a committee that spoke out against changes in Bimbo’s pricing policy. The court consequently ruled against defendant Bimbo’s motion for summary judgment on Ramsey’s breach of contract and unfair and deceptive trade practices claims. After the ruling, Bimbo, pursuant to Federal Rule of Civil Procedure 54(b), asked the court to reconsider its decision.

Claim comparison. Bimbo’s first argument in favor of reconsideration was based on recent letters from Ramsey’s counsel referencing two other terminated independent distributors who had sexual discrimination claims against Bimbo. Ramsey’s attorney wrote that his client’s claims and those of the two other operators were “exactly alike.” Bimbo seized upon that language to argue that if Ramsey’s claim was “exactly alike” the claims of the two other operators, who had not participated in the committee that spoke out against changes in Bimbo’s pricing policy, then Ramsey could not have been terminated because of his opposition to Bimbo’s pricing policies, as he alleged.

The court rejected this line of reasoning. It was likely that Ramsey’s attorney’s “exactly alike” comment merely indicated that the cases were alike in that Bimbo improperly terminated their distribution agreements. It should not be read to indicate that Ramsey was retracting his contention that he was targeted on a pre-textual basis. Accordingly, the court ruled, the letters were not a proper basis for reconsideration of the court’s earlier summary judgment order.

Misapprehension. Bimbo’s other argument in favor of reconsideration was the allegation that the court had misconstrued the applicable timeline regarding the out-of-stock situation for which a Harris Teeter store banned Ramsey, leading the court to the erroneous conclusion that Bimbo’s ordering system may have given rise to the out-of-stock situation.

The court stated that, even assuming it misapprehended the evidence as Bimbo suggests, Ramsey had produced other evidence sufficient to create a genuine dispute of material fact as to whether Bimbo terminated his agreement in retaliation for his opposition to its change in pricing policies. For instance, Ramsey noted that his termination occurred relatively shortly after a meeting in which he was very vocal in his objections to Bimbo’s decrease in margins. This evidence alone, continued the court, created a triable issue of fact as to Bimbo’s reason for terminating Ramsey’s agreement. Accordingly, the court ruled, the alleged misapprehension of certain evidence was also not a proper basis for reconsideration of the court’s earlier summary judgment order.

The case is Civil Action No. 5:14-CV-26-BR.

Attorneys: Edgar R. Bain (Bain, Buzzard & McRae, LLP) for Richard Ramsey. Deborah L. Edney (Parker, Poe, Adams & Bernstein, LLP) for Bimbo Foods Bakeries Distribution, LLC.

Companies: Bimbo Foods Bakeries Distribution, LLC

Cases: FranchisingDistribution StateUnfairTradePractices NorthCarolinaNews