Redner's Markets, Inc. v. Joppatowne G.P. Ltd. Partnership , 594 F. App'x 798 ( 2014 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 13-1766
REDNER’S MARKETS, INC.,
Plaintiff - Appellee,
v.
JOPPATOWNE G.P. LIMITED PARTNERSHIP,
Defendant - Appellant.
No. 13-1974
REDNER’S MARKETS, INC.,
Plaintiff - Appellee,
v.
JOPPATOWNE G.P. LIMITED PARTNERSHIP,
Defendant - Appellant.
No. 13-2279
REDNER’S MARKETS, INC.,
Plaintiff - Appellant,
v.
JOPPATOWNE G.P. LIMITED PARTNERSHIP,
Defendant - Appellee.
Appeals from the United States District Court for the District
of Maryland, at Baltimore. Richard D. Bennett, District Judge.
(1:11-cv-01864-RDB)
Argued: October 28, 2014 Decided: December 17, 2014
Before WILKINSON and KING, Circuit Judges, and HAMILTON, Senior
Circuit Judge.
Affirmed by unpublished per curiam opinion.
ARGUED: Charles Milton Kerr, KERR MCDONALD, LLP, Baltimore,
Maryland, for Appellant/Cross-Appellee. John J. Miravich, FOX
ROTHSCHILD LLP, Exton, Pennsylvania, for Appellee/Cross-
Appellant. ON BRIEF: Kathleen M. McDonald, KERR MCDONALD, LLP,
Baltimore, Maryland, for Appellant/Cross-Appellee.
Unpublished opinions are not binding precedent in this circuit.
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PER CURIAM:
On May 10, 2011, Redner’s Markets, Inc. (Redner’s) filed
this diversity action for breach of contract under Maryland law
against its landlord, Joppatowne G.P. Limited Partnership
(Joppatowne), seeking monetary relief and permanent injunctive
relief for numerous alleged violations of a restrictive-use
covenant in a twenty-year commercial lease (the Lease).
Redner’s also sought declaratory relief pursuant to the
Declaratory Judgment Act. See 28 U.S.C. § 2201. Following a
bench trial, the district court entered judgment in favor of
Redner’s in part and in favor of Joppatowne in part. The
district court also denied a post trial motion by Redner’s.
Both sides have appealed.
I.
The relevant facts on appeal are as follows. Redner’s is a
Pennsylvania corporation with its principal place of business in
Reading, Pennsylvania. Joppatowne is a Maryland limited
partnership with its principal place of business in Baltimore,
Maryland. On November 23, 2005, Redner’s and Joppatowne
executed a commercial lease whereby Redner’s leased
approximately 54,000 square feet of retail space in the
Joppatowne Plaza Shopping Center (Shopping Center) in
Joppatowne, Maryland in order to operate a warehouse-style
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grocery store. Joppatowne owns and manages the Shopping Center.
Of relevance on appeal, the Lease contains a
restrictive-use covenant (the Restrictive-Use Covenant) whereby
Joppatowne covenanted that, during the term of the Lease, “it
shall not lease to, use, or permit to be used or otherwise allow
any portion of the Shopping Center . . . to be used as a food
supermarket, butcher shop, seafood shop, or ‘grocery store.’”
(J.A. 2494). The Lease specifically defines both the terms
“food supermarket” and “grocery store,” inter alia, as:
any retail operator in the Shopping Center whose Gross
Floor Area is 15,000 square feet or less and whose
in-store sales areas offering canned foods,
fresh-baked bakery items; baking ingredients; fresh or
frozen meats and deli items; fresh uncooked fruits and
vegetables; ice cream, frozen vegetables and frozen
prepared foods; milk and milk products, butter, eggs
and cheese; and pet foods that exceed, in the
aggregate, twenty-five percent (25%) of such retail
operator’s Gross Floor Area . . . .
(J.A. 2494). The Lease also contains an exception to the
Restrictive-Use Covenant providing that the Restrictive-Use
Covenant applies only so long as Redner’s was not in default
under the terms of the Lease as the Lease defines an event of
default by Redner’s. Also of relevance on appeal, on November,
20, 2006, Redner’s and Joppatowne executed an amendment to the
Lease authorizing Redner’s to build and operate a gas station in
the Shopping Center’s parking lot.
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The trouble in this case can be traced back to when, on
October 21, 2009, Joppatowne entered into a 10–year lease with
JTF, LLC (JTF), a Maryland limited liability corporation. * All
told, JTF leases approximately 108,000 square feet in the
Shopping Center, divided between a flea market of roughly 96,000
square feet and an Amish farmer’s market (the Amish Farmer’s
Market) of roughly 12,000 square feet. A fence physically
separates the two areas.
The operative complaint in this case is the amended
complaint filed by Redner’s against Joppatowne on September 15,
2011, in which Redner’s contends that by permitting a group of
ten stalls to operate in the Shopping Center, Joppatowne was in
breach of the Restrictive-Use Covenant in the Lease. Seven of
the ten stalls at issue are located within the Amish Farmer’s
Market——Beiler’s BBQ, Beiler’s Baked Goods, Dutch Delights,
Dutch Pantry Fudge, King’s Cheese & Deli, Kreative Kitchen, and
Lapp’s Fresh Meats. The other three stalls are located outside
the enclosure of the Amish Farmer’s Market but still within
space JTF leased from Joppatowne——All Fresh Seafood & Produce
(All Fresh) and two with names unidentified in the record. Each
stall is separately owned and operated.
*
Although the JTF lease was signed on October 21, 2009, the
lease term did not begin until March 1, 2010.
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In late 2011, a bench trial on the issues of liability and
traditional damage theories commenced. United States District
Judge Benson Legg conducted the bench trial over seven
nonconsecutive days, from December 5, 2011 to August 14, 2012.
On January 24, 2013, Judge Legg issued a memorandum opinion in
which he found that Joppatowne’s allowance of Lapp’s Fresh Meats
and All Fresh to operate in the Shopping Center infringed the
Restrictive-Use Covenant, while its allowance of Dutch Delights,
Dutch Pantry Fudge, and Kreative Kitchen to do the same did not.
Judge Legg reserved the issues of whether Joppatowne’s allowance
of the remaining stalls——Beiler’s BBQ, Beiler’s Baked Goods,
King’s Cheese & Deli, and the two other stalls unidentified by
name in the record——to operate in the Shopping Center infringed
the Restrictive-Use Covenant, as well as the issue of Redner’s
damages, for a report and recommendation by a United States
magistrate judge. The district court also entered an order on
January 24, 2013 in conformity with its January 24, 2013
memorandum opinion.
Upon Judge Legg’s retirement, the case was reassigned to
United States District Judge Richard Bennett. After Joppatowne
objected to Judge Legg’s order of reference to a United States
magistrate judge, Judge Bennett vacated it. Based on Judge
Legg’s findings of liability with respect to Lapp’s Fresh Meats
and All Fresh, Redner’s filed a motion for a permanent
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injunction, seeking an order permanently enjoining Joppatowne
from continuing to allow Lapp’s Fresh Meats and All Fresh to
operate in the Shopping Center. In a memorandum opinion
applying Maryland law filed June 13, 2013, the district court
decided that a permanent injunction was warranted with respect
to Lapp’s Fresh Meats and All Fresh because Joppatowne had
violated the Restrictive-Use Covenant in their regard and the
equities favored Redner’s. The district court filed an order to
this effect on June 13, 2013 as well (the Permanent Injunction).
The next day, Joppatowne noted a timely appeal from this
memorandum opinion and the Permanent Injunction, which appeal is
docketed as Appeal Number 13-1766.
Joppatowne moved below to stay enforcement of the Permanent
Injunction. The district court denied the motion. Thereafter,
Joppatowne moved in our court to stay enforcement of the
Permanent Injunction pending appeal. We denied the motion on
June 21, 2013.
The district court then scheduled a second stage of the
bench trial for July 1 and 2, 2013, with the following issues
remaining to be tried: (1) whether Joppatowne breached the
Restrictive-Use Covenant by allowing Beiler’s BBQ, Beiler’s
Baked Goods, King’s Cheese & Deli, and the two unnamed stalls to
operate in the Shopping Center, and (2) whether Redner’s is
entitled to damages for lost profits in connection with
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Joppatowne’s allowance of any infringing stalls. However, on
the first morning of trial, Redner’s abandoned its breach of
contract claim relating to all but Beiler’s Baked Goods. And
with respect to that stall, Redner’s indicated that it would
pursue only injunctive relief. Accordingly, the issue of lost
profits damages pertained only to the two stalls for which Judge
Legg had already found liability——Lapp’s Fresh Meats and All
Fresh.
Following trial, the district court made findings of fact
and conclusions of law pursuant to Rule 52(a) of the Federal
Rules of Civil Procedure. The district court set forth such
findings of fact and conclusions of law in a memorandum opinion
filed July 11, 2013. The district court first concluded that
Joppatowne had not breached the Lease by permitting Beiler’s
Baked Goods to operate in the Shopping Center. Second, the
district court held that Redner’s failed to carry its burden of
proving lost profits damages with reasonable certainty as to
Lapp’s Fresh Meats and All Fresh.
Of relevance on appeal, on July 11, 2013, the district
court filed an order and judgment: (1) in favor of Redner’s for
breach of the Restrictive-Use Covenant in the Lease, to the
extent that Joppatowne allowed Lapp’s Fresh Meats and All Fresh
to operate in the Shopping Center, and incorporating the June
13, 2013 Permanent Injunction by reference, but not awarding
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Redner’s any amount for lost profits damages with respect to
Lapp’s Fresh Meats and All Fresh; and (2) in favor of Joppatowne
with respect to Redner’s claims pertaining to the operation in
the Shopping Mall of Beiler’s BBQ, Beiler’s Baked Goods, Dutch
Delights, Dutch Pantry Fudge, King’s Cheese & Deli, Kreative
Kitchen, and the two unnamed vendor stalls.
Redner’s subsequently moved to amend the district court’s
findings of fact and conclusions of law and for a new trial
pursuant to Federal Rules of Civil Procedure 52 and 59. In a
document entitled “MEMORANDUM ORDER,” filed September 17, 2013,
the district court denied this motion in all respects except
that it granted the motion to the extent Redner’s was entitled
to nominal damages of $2.00.
Joppatowne noted a timely appeal of the district court’s
July 11, 2013 order and judgment, which appeal is docketed as
Appeal Number 13-1974. Redner’s subsequently noted a timely
cross-appeal of “the orders and judgment entered in this case on
January 24, 2013, July 11, 2013, and September 17, 2013,” which
we docketed as Appeal Number 13-2279. (J.A. 3307).
Ultimately, we consolidated Appeal Numbers 13-1766, 13-
1974, and 13-2279 into the present appeal.
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II.
Joppatowne raises numerous assignments of error with
respect to the Permanent Injunction and the district court’s
July 11, 2013 order and judgment, which Joppatowne contends
should be resolved in its favor. Having carefully reviewed the
briefs, the record, and the relevant law, and having had the
benefit of oral argument, we conclude that each assignment of
error is without merit and affirm on the reasoning of the
district court as stated in its June 13, 2013 memorandum
opinion, Redner’s Mkts., Inc. v. Joppatowne G.P. Ltd. P’ship,
No. RDB–11–1864, 2013 WL 2903285 (D.Md. June 13, 2013), and its
July 11, 2013 memorandum opinion, Redner’s Mkts., Inc. v.
Joppatowne G.P. Ltd. P’ship, No. RDB–11–1864, 2013 WL 3678248(D.Md. July 11, 2013).
III.
In its cross-appeal, Redner’s raises numerous assignments
of error with respect to the district court’s January 24, 2013
order, the district court’s July 11, 2013 order and judgment,
and the district court’s September 17, 2013 memorandum order.
Having carefully reviewed the briefs, the record, and the
relevant law, and having had the benefit of oral argument, we
conclude that each assignment of error is without merit and
affirm on the reasoning of the district court as stated in its
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January 24, 2013 memorandum opinion, Redner’s Mkts., Inc. v.
Joppatowne G.P. Ltd. P’ship, 918 F. Supp. 2d 428 (D.Md. January
24, 2013), its July 11, 2013 memorandum opinion, Redner’s Mkts.,
Inc. v. Joppatowne G.P. Ltd. P’ship, No. RDB–11–1864, 2013 WL
3678248 (D.Md. July 11, 2013), and its September 17, 2013
memorandum order, Redner’s Mkts., Inc. v. Joppatowne G.P. Ltd.
P’ship, No. RDB–11–1864, 2013 WL 5274356 (D.Md. Sept. 17, 2013).
IV.
For the reasons stated herein, the judgments below are
affirmed.
AFFIRMED
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