Michael S. Geisler, M. Geisler, Inc. v. Fedex Ground Package Sys., Inc.

MICHAEL S. GEISLER, M. GEISLER, INC., MATTHEW E. HOWELL,and MATT'S DELIVERY TEAM, INC., Plaintiffs, v. FEDEX GROUND PACKAGE SYSTEM, INC., Defendant.

Case No. 3:12-cv-1189-J-34PDB

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA JACKSONVILLE DIVISION

January 13, 2015

ORDER

THIS CAUSE is before the Court on Defendant FedEx Ground Package System, Inc.'s Motion for Case Dispositive Summary Judgment as to Plaintiffs Matthew E. Howell, Matt's Delivery Team Inc., Michael S. Geisler, and M. Geisler, Inc., Statement of Undisputed Material Facts, and Supporting Memorandum of Law (Doc. 35; Motion), filed on April 8, 2014. Plaintiffs Michael S. Geisler (Geisler) and Matthew E. Howell (Howell) initiated this action against Defendant FedEx Ground Package System, Inc. (FedEx), on October 29, 2012, by filing a Complaint and Demand for Jury Trial (Doc. 1), which the Court struck as an impermissible shotgun pleading (Doc. 3). On November 8, 2012, Geisler and Howell filed an Amended Complaint and Demand for Jury Trial (Doc. 5). Then, on May 9, 2013, Geisler and Howell filed Plaintiffs' Unopposed Motion for Leave to Amend and File Second AmendedComplaint to Add Party Plaintiffs (Doc. 12; Motion for Leave to Amend), in which they sought to add M. Geisler, Inc. (MGI), and Matt's Delivery Team, Inc. (MDT), as plaintiffs. The Court granted the Motion for Leave to Amend on May 10, 2013 (Doc. 13). On May 14, 2013, Geisler, MGI, Howell, and MDT (Plaintiffs) filed the Second Amended Complaint and Demand for Jury Trial (Doc. 14; Second Amended Complaint).

In the Second Amended Complaint, Plaintiffs allege a breach of contract claim based on FedEx's termination of MGI's and MDT's Operating Agreements (Count 1) and a claim for violation of Florida's Deceptive and Unfair Trade Practices Act, FLA. STAT. § 501.201, et. seq. (FDUTPA) (Count 2). See Second Amended Complaint. In the Motion, FedEx requests that the Court enter summary judgment in FedEx's favor pursuant to Rule 56, Federal Rule of Civil Procedure (Rule(s)). See Motion at 2.¹ Plaintiffs filed a response to the Motion on April 22, 2014. See Plaintiffs' Response in Opposition to Defendant's Motion for Summary Judgment (Doc. 38; Response). With leave of Court, (Doc. 42), FedEx filed Defendant's Reply in Support of Summary Judgment (Doc. 43; Reply) on June 9, 2014. Accordingly, the matter is ripe for review.

I. Background²

On February 20, 1995, Howell entered into an Operating Agreement with Roadway Package System, Inc., FedEx's predecessor, for an initial term of five years, renewablethereafter for successive one year terms. See Roadway Package System, Inc. Pick-Up and Delivery Contractor Operating Agreement (Doc. 35-2, Exhibit 1; Howell Operating Agreement);³ see Matthew Howell Deposition at 51, 64-66 (Doc. 35-1, Exhibit A; Doc. 38-4, Exhibit D; Doc. 50-1, Exhibit A; Howell Dep.). In December 2010, Howell incorporated MDT, and on January 29, 2010, Howell assigned his interests under the Operating Agreement to MDT. Howell Dep. at 72-73; see Assignment Amendment to Operating Agreement (Doc. 35-2, Exhibit 2; Howell Assignment).⁴ Under the Operating Agreement, Howell originally purchased one contracted route, or Primary Service Area (PSA). Howell Dep. at 56. Howell later acquired additional PSAs and supplemental routes, and at the time FedEx terminated MDT's contract, MDT had a total of two contracted routes and two supplemental routes. Id. at 76-77.

Geisler entered into an Operating Agreement with FedEx on March 27, 2000, for an initial term of three years. See FedEx Ground Package System, Inc. Pick-up and Delivery Contractor Operating Agreement (Doc. 14-2; Exhibit B; Doc. 35-5, Exhibit 1; Geisler Operating Agreement); Michael Geisler Deposition at 54-55 (Doc. 35-4, Exhibit D; Doc. 38-1, Exhibit A; Doc. 50-5, Exhibit C; Geisler Dep.). In approximately December 2010, Geisler incorporated MGI for the purpose of continuing his contractual relationship with FedEx.Geisler Dep. at 31-32.⁵ Thereafter, MGI held the contractual relationship with FedEx. See, e.g., MGI June 17, 2011 Business Discussion Record (Doc. 35-5, Exhibit 2; Doc. 50-5, Exhibit 2; MGI 6/17/2011 BDR ); MGI Dec. 2, 2011 Business Discussion Record (Doc. 50-5, Exhibit 3; MGI 12/2/2011 BDR); Geisler's Termination Letter (Doc. 35-5, Exhibit 4; Geisler's Termination Letter). Throughout Geisler's, and later MGI's, contractual relationship with FedEx, the only route Geisler and MGI operated was the Orange Park, Florida PSA. Geisler Dep. at 39, 64.

A. The Operating Agreements

Both Operating Agreements provide that "[t]his Agreement shall automatically renew for successive terms of one year each after expiration of the initial term unless Contractor or FedEx Ground provides the other party notice of non-renewal in writing at least 30 days prior to the expiration of the initial term or any successive renewal term." Geisler Operating Agreement ¶ 11.2; see also Howell Operating Agreement ¶ 11.2.⁶ The "Termination Provisions" specify that the "Agreement[s] may be terminated during the initial term or during any renewal term hereof . . . [b]y Contractor or FedEx Ground if the other party breaches orfails to perform the contractual obligations imposed by this Agreement[.]" Geisler Operating Agreement ¶ 12.1(c); see also Howell Operating Agreement ¶ 12.1(c).⁷

The Operating Agreements further provide for an "Agreed Standard of Service." See Howell Operating Agreement ¶ 1.10; Geisler Operating Agreement ¶ 1.10. Pursuant to this provision, the "Contractor agrees to . . . [p]rovide daily pick-up and delivery service to consignees and shippers on days and at times which are compatible with their schedules and requirements within Contractor's Primary Service Area[.]" Howell Operating Agreement ¶ 1.10(a); Geisler Operating Agreement ¶ 1.10(a). This provision also states that the "Contractor agrees to . . . "[c]onduct all business activities with integrity and honesty, in a professional manner, and with proper decorum at all times." Howell Operating Agreement ¶ 1.10(h); Geisler Operating Agreement ¶ 1.10(h).

On January 28, 2011, MDT, through Howell, executed an addendum to the Operating Agreement, Addendum 16. See Addendum 16, Pick Up and Delivery Contractor Operating Agreement, Contractor as a Corporate Entity and Employer (Doc. 35-3, Exhibit 7; Addendum 16). MGI, through Geisler, executed an identical Addendum on February 15, 2011. See Addendum 16, Pick Up and Delivery Contractor Operating Agreement, Contractor as a Corporate Entity and Employer (Doc. 35-6, Exhibit 7; Addendum 16). Paragraph 8 to Addendum 16 is labeled, "Grounds for Termination of Agreement and Opportunity to Cure" and lists items which "will be sufficient to constitute a material breach" including, "an act of Contractor . . . that is inconsistent with the honesty and integrity and compliance with law provisions of Section 1.10 of the Agreement including without limitation making a falsecertification of fact such as forging recipient's name as proof of delivery," or "intentionally miscoding or mis-scanning the status of a package[.]" Addendum 16 ¶ 8.

B. The Office Max Pickup

FedEx has a national account with its customer Office Max. Geisler Dep. at 71; Donald Stratmann Deposition at 46 (Doc. 35-8, Exhibit H; Stratmann Dep.). The nationwide contract between FedEx and Office Max sets the pickup window for Office Max locations at 5:00 p.m. to 7:00 p.m., meaning that FedEx must complete the package pickup at Office Max locations, including the Kingsley Square Mall Office Max (KS Office Max) in Orange Park, Florida, during the two hour window between 5:00 p.m. and 7:00 p.m. Geisler Dep. at 71, 80; Stratmann Dep. at 46; Howell Dep. at 114-15.

FedEx initially assigned the KS Office Max pickup to Geisler and MGI, and Geisler completed the pickups. Geisler Dep. at 71-72, 79.⁸ However, during this time, Geisler would not complete the KS Office Max pickup during the 5:00 p.m. to 7:00 p.m. window but rather would typically complete the pickup between 2:00 p.m. and 4:00 p.m. Id.⁹ Geisler testified that he completed the KS Office Max pickup early because the designated pickup window "didn't work for [him]" because he "was on the other side of [his] route at that time." Id. at 73-74. When asked what he meant by indicating that the pickup times "were pushing [him]" and "didn't work for [him]," Geisler acknowledged that it was "both" that he was "too far away[on his route]" and that "it would require [him] to get back to the station a little bit later[.]" Id. at 75-76.

Approximately a year and a half before FedEx terminated the Operating Agreements, Geisler discussed his problems concerning the KS Office Max pickup with FedEx Pickup and Delivery Coordinator Tim Mockabee (Mockabee). Id. at 75-79. Several weeks after this initial discussion, Mockabee suggested that Geisler "give the pickup" to Howell since Howell was out on his route later than Geisler. Id. at 77-78. Mockabee told Geisler that Howell could "zero" out the pickup "on his pickups listing," meaning that Howell could enter a code on his scanner indicating that there were "no packages picked up in the pickup window."¹⁰ Id. at 82. Thereafter, Geisler approached Howell about taking the KS Office Max pickup, Howell agreed, and Mockabee then put the KS Office Max pickup on Howell's listing. Id. at 78-79, 99.

Geisler's and Howell's arrangement consisted of Geisler completing the KS Office Max pickup between approximately 2:00 p.m. and 4:00 p.m. Id. at 83, 99; Howell Dep. at 127-28. When Geisler completed the KS Office Max pickup, he would scan the pickup as "unlisted," which Geisler explained meant it was a "pickup being made on my route that's not on my listing." Geisler Dep. at 99. According to Geisler, "near or after the pickup window started" either Geisler or Howell would call the KS Office Max to see if there were any additional packages that needed to be picked up, and if so, Howell would "more than likely"complete this later...