Transport Truck & Trailer, Inc. v. Freightliner, LLC

FILED
NOT FOR PUBLICATION MAR 01 2010
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U .S. C O U R T OF APPE ALS
FOR THE NINTH CIRCUIT
TRANSPORT TRUCK & TRAILER, No. 08-35855
INC.,
D.C. No. 1:06-cv-00282-BLW
Plaintiff-counter-defendant -
Appellant,
MEMORANDUM *
and
TRANSPORT EQUIPMENT LEASING,
LLC,
Plaintiff,
v.
FREIGHTLINER, LLC,
Defendant-counter-claimant -
Appellee.
TRANSPORT EQUIPMENT LEASING No. 08-35894
LLC,
D.C. No. 1:06-cv-00282-BLW
Plaintiff,
and
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
TRANSPORT TRUCK & TRAILER,
INC.; et al.,
Plaintiffs-counter-defendants -
Appellees,
v.
FREIGHTLINER, LLC,
Defendant-counter-claimant -
Appellant.
TRANSPORT TRUCK & TRAILER, No. 09-35169
INC.,
D.C. No. 1:06-cv-00282-BLW
Plaintiff-counter-defendant -
Appellee,
v.
FREIGHTLINER, LLC,
Defendant-counter-claimant-
plaintiff - Appellant,
v.
WILLARD W. HOWELL,
Defendant-counter-claimant -
Appellee.
Appeal from the United States District Court
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for the District of Idaho
B. Lynn Winmill, Chief District Judge, Presiding
Argued and Submitted January 13, 2010
Seattle, Washington
Before: KLEINFELD and TALLMAN, Circuit Judges, and SETTLE, *** District
Judge.
We affirm the district court’s grant of summary judgment for defendant
Freightliner, LLC, on Transport Truck & Trailer, Inc.’s claims, and for defendant
Transport Truck on Freightliner’s counterclaims, and its decision not to award
attorneys’ fees to either side.
1. Preclusive effect of state administrative agency findings.
The district court applied issue preclusion to bar relitigation of factual
findings made by the state agency during the administrative proceeding. We
review de novo the district court’s determination that collateral estoppel is
available. Miller v. County of Santa Cruz, 39 F.3d 1030, 1032 (9th Cir. 1994)
(citations omitted). Where “collateral estoppel is available, we review for abuse of
discretion the district court’s decision to give preclusive effect to the agency
decision.” Id. (citation omitted).
***
The Honorable Benjamin Hale Settle, United States District Judge for
the Western District of Washington, sitting by designation.
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We affirm the district court’s determination that Transport Truck was
precluded from relitigating the issues that were finally determined by the Idaho
Department of Transportation in its administrative hearing on the franchise
termination. The record reflects that Transport Truck had a full and fair
opportunity to litigate the issues before the state administrative agency, and that the
state administrative proceedings met the requirements of fairness set forth in
United States v. Utah Construction & Mining Company, 384 U.S. 394, 422 (1966).
Idaho state courts apply res judicata to issues and claims determined by Idaho
administrative agencies. See J & J Contractors v. Idaho Transp. Bd., 797 P.2d
1383, 1385 (Idaho 1990) (“The doctrine of claim preclusion, or res judicata,
applies to the effect of administrative decisions.”) (citations omitted); see also
Ticor Title Co. v. Stanion, 157 P.3d 613, 617 (Idaho 2007) (“The doctrine of res
judicata covers both claim preclusion (true res judicata) and issue preclusion
(collateral estoppel).”) (citation omitted). Thus, application of issue preclusion is
available and appropriate. The district court did not abuse its discretion in giving
the state agency’s decision preclusive effect. Miller, 39 F.3d at 1032 (citing
University of Tennessee v. Elliot, 478 U.S. 788, 797-99 (1986)); see also Misischia
v. Pirie, 60 F.3d 626, 629 (9th Cir. 1995).
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2. Summary Judgment on Transport Truck’s Claims
We review de novo the district court’s grant of summary judgment. Carmen
v. S. F. Unified Sch. Dist., 237 F.3d 1026, 1029 (9th Cir. 2001). We affirm the
district court’s grant of summary judgment in favor of Freightliner on each of
Transport Truck’s claims.
Transport Truck failed to present sufficient evidence supporting its claim for
breach of the implied covenant of good faith and fair dealing beyond what had
already been presented in the four-day hearing before the state agency’s hearing
officer. The hearing officer had already considered the evidence and relevant
factors and found that Freightliner had not acted in bad faith. Because the issues
presented had already been litigated and determined against Transport Truck, and
Transport Truck had failed to present additional evidence, Transport Truck did not
show that there was a genuine issue of material fact preventing summary judgment
in favor of Freightliner.
Transport Truck contends that it raised questions of material fact concerning
whether Freightliner interfered with Transport Truck’s negotiations in 2003 for its
sale to the Papé Group, and thus should go to trial on its claim of intentional
interference with prospective economic gain. But Transport Truck’s Second
Amended Complaint does not mention the 2003 negotiations with the Papé Group
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with which Freightliner allegedly interfered, and thus did not put the defendant on
notice of that claim. Because the claim was not pleaded, it does not prevent
summary judgment.
Transport Truck did not establish a genuine issue of material fact on its
claim arising out of the new Freightliner dealership hiring some of Transport
Truck’s former employees. It demonstrated neither that the conduct, an
announcement in the newspaper, was tortious, nor that damages were proximately
caused by interference with Transport Truck’s employment contracts. For a
tortious interference with contractual relations claim, Idaho law requires
knowledge by the interfering party of the existence of the contract or prospective
economic advantage, intentional interference without justification, causation, and
damages. Idaho First Nat’l Bank v. Bliss Valley Foods, Inc., 824 P.2d 841, 858-59
(Idaho 1991).
3. Summary Judgment on Freighliner’s Counterclaims
Freightliner’s counterclaims are barred by the limitation of remedies clause
in the parties’ contract, which expressly prohibits “consequential damages . . . such
as lost profits.” Termination of the franchise agreement is the remedy for breach
contracted for by the parties, and Freightliner has already terminated it.
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4. Attorneys’ Fees
We review for abuse of discretion a district court’s award of attorneys’ fees
under state law. See Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894,
898 (9th Cir. 2006). We review de novo whether a state statute permits attorneys
fees. See O'Hara v. Teamsters Union Local No. 856, 151 F.3d 1152, 1157 (9th Cir.
1998).
Idaho Code § 12-120(3) allows for the reasonable award of attorneys’ fees to
the prevailing party in any action to recover on a contract. Idaho Code § 12-
120(3); City of McCall v. Buxton, 201 P.3d 629, 638 (Idaho 2009). Because this
case arises out of a dispute over the obligations inherent in the franchise contract
between Transport Truck and Freightliner, Idaho Code §12-120(3) applies and fees
may be awarded to the prevailing party.
Although prevailing party fees were available under Idaho law, the district
court did not abuse its discretion by finding that there was no prevailing party in
the litigation. Under Idaho law, the district court has discretion to determine which
party prevailed in the litigation. Shore v. Peterson, 204 P.3d 1114, 1125 (Idaho
2009). The court considers three principal factors in determining which party, if
any, prevailed: “(1) the final judgment or result obtained in relation to the relief
sought; (2) whether there were multiple claims or issues between the parties; and
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(3) the extent to which each of the parties prevailed on each of the claims or
issues.” Nguyen v. Bui, 191 P.3d 1107, 1112 (Idaho App. 2008) (interpreting
Idaho R. Civ. P. 54(d)(1)(B)). Moreover, “[w]hen both parties are partially
successful, however, it is within the court’s discretion to decline an award of
attorney fees to either side.” Shore, 204 P.3d at 1125 (citing Israel v. Leachman,
72 P.3d 864, 867 (Idaho 2003)). In determining whether a trial court abused its
discretion, Idaho appellate courts consider “whether the trial court: (1) perceived
the issue as one of discretion; (2) acted within the outer boundaries of this
discretion and consistently with the legal standards applicable to the specific
choices available to it; and (3) reached its decision by an exercise of reason.” Id. at
1126.
The district court did not abuse its discretion in declining to award attorneys’
fees to either side. First, it identified the issue as one within its discretion.
Second, it acted within Idaho law by declining to award attorneys’ fees to either
side where both parties had been partially successful (and partially unsuccessful).
Finally, it gave clear reasons for deciding not to award fees. In particular, the
district court examined the alleged respective “values” of the claims and
counterclaims and compared them. Because both sides lost their claims and no
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damages were awarded to either side, the district court found that this comparison
was unhelpful in determining which party was the “prevailing” party.
Because the district court properly applied state law in reaching its decision
on attorneys’ fees, the district court did not abuse its discretion in refusing to award
attorneys’ fees to either side.
AFFIRMED.
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