United States District Court, D. Maryland
P. Gesner Chief United States Magistrate Judge
U.S. Foods, Inc. (“US Foods, ” or
“plaintiff”) brings this breach of contract
action against defendants Germain Holdings, LLC, d/b/a
Overlea Caterers (“Overlea”) and Bryan Crittenden
(“Crittenden, ” or “defendant”),
alleging that Overlea entered into two contracts with
plaintiff, which were guaranteed by Crittenden, and breached
said contracts by failing to make full payments for goods and
services provided by plaintiff. (ECF No. 1 at 3-4). Currently
pending before the court is plaintiff's Motion for
Summary Judgment (“Motion”) (ECF No. 27).
Plaintiff has also submitted a Supplemental Brief in Support
of Motion for Summary Judgment (“Supplemental
Brief”) (ECF No. 36). Defendant, who is pro
se, was notified that the Motion had been filed and
given an opportunity to respond but failed to do so. (ECF No.
29). Upon review of the pleadings and the applicable case
law, the court determines that no hearing is necessary.
See Local Rule 105.6. For the reasons stated below,
plaintiff's Motion (ECF No. 27) is GRANTED.
ruling on a motion for summary judgment, this court considers
the facts and draws all reasonable inferences in the light
most favorable to the nonmoving party. Scott v.
Harris, 550 U.S. 372, 378 (2007). “[T]he failure
of a party to respond to a summary judgment motion may leave
uncontroverted those facts established by the motion.”
Custer v. Pan Am. Life Ins. Co., 12 F.3d 410, 416
(4th Cir. 1993).
2017, plaintiff, a food service distributor, contracted with
Overlea, who prepared and delivered bulk meals to customers
in Maryland, to sell and deliver goods to Overlea. (ECF No.
27-1 at 1-2). First, plaintiff executed an Electronic Credit
Application (the “Credit Agreement”) pursuant to
which plaintiff “agreed to sell and Overlea agreed to
purchase food and food-related goods to be delivered to
Overlea.” (ECF No. 27-1 at 2). The Credit Agreement
included a personal guaranty clause, signed by Crittenden.
(Id. (citing ECF No. 27-4 at 7)). That same month,
plaintiff and Overlea executed a Master Distribution
Agreement (“MDA”) that incorporated the Credit
Agreement and further detailed the terms of the agreement.
(ECF No. 27-1 at 2 (citing ECF No. 34 at 6)).
to the Credit Agreement and the MDA, Overlea ordered food and
food-related goods from plaintiff, and plaintiff provided
Overlea with these goods. (ECF No. 27-1 at 3 (citing ECF No.
27-5)). For each order made by Overlea, plaintiff created and
provided Overlea with an invoice detailing the amount due and
terms. (Id.) Overlea failed to fully pay these
invoices, however, and plaintiff filed suit on April 5, 2018,
alleging that Overlea owed $296, 551.01, exclusive of
interest, costs, and fees. (ECF No. 1 at 5). Overlea failed
to answer plaintiff's Complaint, and on July 17, 2018,
the Clerk of Court entered an order of default against
Overlea. (ECF No. 12). On August 14, 2018, the court entered
a default judgment against Overlea in the amount of $337,
001.93, for $296, 551.01 in unpaid invoices, $35, 586.12 in
pre-judgment interest, $4, 421.80 in reasonable
attorneys' fees, and $443 in costs and expenses incurred
by plaintiff. (ECF No. 15). On January 28, 2019, plaintiff
filed the instant Motion seeking an entry of summary judgment
against Crittenden as guarantor for the agreements. (ECF No.
STANDARD OF REVIEW
judgment is appropriate when “there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a). A
genuine dispute remains “if the evidence is such that a
reasonable jury could return a verdict for the nonmoving
party.” Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 248 (1986). A fact is properly considered
“material” only if it might affect the outcome of
the case under the governing law. Id. The party
moving for summary judgment has the burden of demonstrating
the absence of any genuine issue of material fact.
Fed.R.Civ.P. 56(a); Pulliam Inv. Co., Inc. v. Cameo
Props., 810 F.2d 1282, 1286 (4th Cir. 1987). On those
issues for which the nonmoving party has the burden of proof,
however, it is his or her responsibility to oppose the motion
for summary judgment with affidavits or other admissible
evidence specified in Federal Rule of Civil Procedure 56.
Fed.R.Civ.P. 56(c); Mitchell v. Data Gen. Corp., 12
F.3d 1310, 1315-16 (4th Cir. 1993). If a party fails to make
a showing sufficient to establish the existence of an
essential element on which that party will bear the burden of
proof at trial, summary judgment is proper. Celotex Corp.
v. Catrett, 477 U.S. 317, 322-23 (1986).
reviewing a motion for summary judgment, the court does not
evaluate whether the evidence favors the moving or nonmoving
party, but considers whether a fair-minded jury could return
a verdict for the nonmoving party on the evidence presented.
Anderson, 477 U.S. at 252. In undertaking this
inquiry, the court views all facts and makes all reasonable
inferences in the light most favorable to the nonmoving
party. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio
Corp., 475 U.S. 574, 587 (1986). The nonmoving party,
however, may not rest on its pleadings, but must show that
specific, material facts exist to create a genuine, triable
issue. Celotex, 477 U.S. at 324. A
“scintilla” of evidence in favor of the nonmoving
party, however, is insufficient to prevent an award of
summary judgment. Anderson, 477 U.S. at 252.
Further, “mere speculation” by the nonmoving
party or the “building of one inference upon
another” cannot create a genuine issue of material
fact. Cox v. Cty. of Prince William, 249 F.3d 295,
299-300 (4th Cir. 2001). Summary judgment should be denied
only where a court concludes that a reasonable jury could
find in favor of the nonmoving party. Anderson, 477
U.S. at 252.
the nonmoving party fails to respond altogether to a summary
judgment motion, the court may consider those facts
established by the moving party's motion uncontroverted.
Custer v. Pan Am. Life Ins. Co., 12 F.3d 410, 416
(4th Cir. 1993). The moving party must still establish,
however, “that the uncontroverted facts entitle the
party to ‘a judgment as a matter of law.'”
Id. (quoting Fed.R.Civ.P. 56(c)). “Thus, the
court, in considering a motion for summary judgment, must
review the motion, even if unopposed, and determine from what
it has before it whether the moving party is entitled to
summary judgment as a matter of law.” Id.
Motion, plaintiff relies on Maryland law and cites to
Grudis v. J.B. Hunt Transport, Inc., 124 Fed.Appx.
158, 159 (4th Cir. 2005), which states that “[b]ecause
the source of the federal court's jurisdiction over the
state law tort action was diversity of citizenship, the rule
of Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78 . . .
(1938), requires the application of the law of Maryland, the
forum state, to questions of substantive law.” (ECF No.
27-1 at 5). I note that the Credit Agreement, however,
contains two provisions that state that the laws of Delaware
govern the agreement. Accordingly, I asked plaintiff to provide
a supplemental brief informing the court of its position as
to whether Maryland or Delaware law should govern this case
and provide evidence and authority in support of its
position. (ECF No. 35).
Supplemental Brief, plaintiff argued that Maryland law,
rather than Delaware law, applied to plaintiff's claims
because Delaware did not have a substantial connection to the
transactions at issue in the case. (ECF No. 36 at 2). As
noted by plaintiff, when exercising diversity jurisdiction, a
court generally “applies the substantive law of the
forum state in which it sits.” Taylor v. Lotus Dev.
Corp., 906 F.Supp. 290, 294 (D. Md. 1995) (citing
Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487,
496 (1941); Erie R.R. v. Tompkins, 304 U.S. 64,
78-79 (1938)). In Maryland, “the parties to a contract
may agree as to the law that will govern their transactions,
even as to issues going to the validity of the
contract.” Id. (citing Kronovet v.
Lipchin, 414 A.2d 1096, 1104 (Md. 1980); Nat'l
Glass, Inc. v. J.C. Penney Props., Inc., 650 A.2d 246,
248 (Md. 1994)). Further, under Maryland law, the court
“should presume that a parties' choice of law is
enforceable.” Ameritox, Ltd. v. Savelich, 92
F.Supp.3d 389, 396 (D. Md. 2015). A choice-of-law provision
will not be honored, however, if “1) the state whose
law is chosen has no substantial relationship to the parties
or the transaction; or 2) the strong fundamental public
policy of the forum state precludes the application of the
choice of law provision.” Taylor, 906 F.Supp.
at 294 (quoting Am. Motorists Ins. Co. v. ARTRA Group,
Inc., 659 A.2d 1295, 1301 (Md. 1995)).
plaintiff argues that Delaware does not have a substantial
connection to the transactions at issue in this case. (ECF
No. 36 at 2). Specifically, plaintiff argues, defendant
Overlea is “a Maryland liability company doing business
in Maryland” that transacted with plaintiff “for
the delivery of food and food-related goods and services
delivered within the State of Maryland.” (ECF No. 36 at
3). Additionally, plaintiff argues, Crittenden, as guarantor,
“guaranteed payment for these food and food-related
goods and services order [sic] and delivered within the State
of Maryland.” Id. Finally, plaintiff states
that “the transactions resulting in the breaches at
issue also occurred within the State of Maryland.”
Id. For these reasons, plaintiff argues that the
court should apply Maryland law to its claims.
Fourth Circuit has previously held, however, that “a
party's state of incorporation provides the necessary
‘substantial relationship' for application of its
laws.” Ciena Corp. v. Jarrard, 203 F.3d 312,
324 (4th Cir. 2000) (finding that it was not unreasonable for
the plaintiff to select the law of Delaware, its state of
incorporation, to govern its contracts even though its
principal place of business was Maryland). Here, although
Delaware may not have a substantial connection to the
transactions at issue, Delaware does have a substantial
relationship to plaintiff, as plaintiff is incorporated in
the state of Delaware. (ECF No. 1 at 1). Accordingly,
plaintiff has not offered any evidence that Delaware
“has no substantial relationship to the parties
or the transaction.” Taylor, 906
F.Supp. at 294 (emphasis added). Similarly, plaintiff has not
argued that “the strong fundamental public policy of
[Maryland] precludes the application of the choice of law
provision.” Id. In sum, ...