The opinion of the court was delivered by: Simandle, District Judge
This matter comes before the Court upon a second motion by Defendant Uni-Marts, Inc. ("Uni-Marts") for summary judgment. This motion comes after the completion of Court-ordered additional discovery following Plaintiff Avatar Business Connections, Inc.'s ("Plaintiff") motion for leave to amend its Complaint to add a claim of breach of the covenant of good faith and fair dealing against Defendant. For the reasons discussed below, Uni-Marts' motion will be granted.
The parties are familiar with the facts of the underlying dispute and the Court need not repeat them here. A brief summary of the dealings between Plaintiff and Uni-Marts, however, is warranted. While pursuing a plan to divest 170 stores, Uni-Marts engaged Plaintiff to serve as its business broker. Plaintiff was charged with marketing the business assets of 67 of Uni-Marts' stores and would be paid a sales commission for each store sale he brokered. The agreement between Uni-Marts and Plaintiff was memorialized in a September 19, 2002 exclusive brokerage agreement (the "Expired Brokerage Agreement"). The Expired Brokerage Agreement contained a "wind-up" provision stating that, in the event Uni-Marts sold all of the assets of the company or undergoes another business combination resulting in a change of control of equity ownership (e.g., a stock sale or merger) during the term of the Expired Brokerage Agreement, Uni-Marts would pay Plaintiff a flat fee of $2,500 for any unsold store listed in an exhibit to the agreement in lieu of a commission.*fn1
The Expired Brokerage Agreement expired on March 19, 2003 and on March 26, 2003, Uni-Marts and Avatar entered into a second brokerage agreement (the "Second Brokerage Agreement"). This new agreement, which expressly replaced and superseded the Expired Brokerage Agreement, differed from the Expired Brokerage Agreement in one key way: the Second Brokerage Agreement did not contain a "wind-up" provision. As in the Expired Brokerage Agreement, however, Plaintiff (1) was entitled to a commission if an "Asset" (as defined in the Second Brokerage Agreement) was purchased by a party procured by Plaintiff*fn2 and (2) would be paid its commission only at the closing of the sale of the Asset(s) and solely from the proceeds Defendant realized from such sale.
In 2002, Defendant set up an Ad Hoc Committee that, beginning in the summer of 2002 and continuing through early 2004, investigated many alternatives to sell the company outside of the efforts being made by Plaintiff. Specifically, according to Defendant's Proxy Statement, the Ad Hoc Committee aggressively pursued a possible stock acquisition of the company and a "going-private" merger transaction. Between 2002 and 2004, Defendant had a number of ultimately unsuccessful suitors interested in acquiring either substantial assets of its business or its entire business. (Id.) In June of 2003, one such suitor, Raj Vakharia, who was introduced to Uni-Marts by Plaintiff, negotiated with Uni-Marts for the purchase of 125 Uni-Marts stores, but ultimately terminated negotiations after it became clear that the parties could not reach an agreement as to the structure and timing of the deal. (Id.)
In December of 2003, during the term of the Second Brokerage Agreement, Mr. Vakharia again approached Uni-Marts' management about a potential deal, but this time to take Uni-Marts private through a merger involving a number of entities. The proposal involved a limited liability company called Green Valley Acquisition Co., LLC. ("Green Valley") that would serve as an acquisition company. (Id. at 28.) Green Valley in turn was owned by two limited liability companies: Tri-Color Holdings, LLC ("Tri-Color")(whose members were three individuals that were directors and executive officers of Defendant) and KOTA Holdings, LLC ("KOTA")(whose members were Raj Vakharia and Paul Levinsohn). After the establishment of Green Valley, Uni-Marts was merged with Green Valley and Green Valley emerged as the surviving company. (Id.) The parties signed a merger agreement on January 26, 2004.
On April 15, 2004, Plaintiff brought a breach of contract claim against Uni-Marts alleging that they breached the "broker agreements" and Plaintiff was owed a commission. (Original Compl. ¶ 12.) In August and September of 2005, the parties filed cross-motions for summary judgment. The Court heard oral argument on the cross-motions and, on December 29, 2005, issued an opinion and order granting Uni-Marts' motion for summary judgment and denying Plaintiff's cross-motion for summary judgment upon Plaintiff's breach of contract claim. See Avatar Bus. Connection, Inc. v. Uni-Marts, Inc., No. 04-1866, 2005 U.S. Dist. LEXIS 37506, *4 (D.N.J. Dec. 29, 2005)(the "December 2005 Opinion").
Literally on the eve of oral argument on the parties' cross-motions, Plaintiff filed a Motion to Amend/Correct its Complaint seeking to (a) add Uni-Marts, LLC as a defendant and (b) add causes of action for in quantum meruit, fraud and breach of the covenant of good faith and fair dealing. (See Amended Compl. ¶ 13-35.) On June 30, 2006, this Court issued an opinion and order allowing Plaintiff to amend its Complaint but only to (1) name Uni-Marts, LLC as the defendant and (2) add a claim for breach of the covenant of good faith and fair dealing (and not to add claims of fraud or unjust enrichment/quantum meruit). See Avatar Bus. Connection, Inc. v. Uni-Marts, Inc., No. 04-1866, 2006 U.S. Dist. LEXIS 44434, *1 (D.N.J. June 30, 2006)(the "June 2006 Opinion"). In granting Plaintiff leave to amend to add a claim of breach of covenant, the Court held:
Despite considerable discovery, Plaintiff has yet to bring to the Court's attention evidence that Uni-Marts acted in bad faith or colluded with Vakharia to structure the ultimate transaction between Green Valley Acquisition Co., LLC and Uni-Marts as a merger in order to avoid paying a commission to Plaintiff (under the Second Brokerage Agreement). . . . Plaintiff should be afforded the opportunity to conduct discovery on this issue.
Id. at *25. The Court ordered Plaintiff to file "an appropriate Amended Complaint consistent with [the Court's opinion]" within fourteen days of the entry of the Order.
On July 19, 2006, Plaintiff filed its Amended Complaint containing Plaintiff's claim of breach of the implied covenant of good faith and fair dealing. [Docket Item No. 31].*fn3 On July 24, 2006, U.S. Magistrate Judge Ann Marie Donio issued a scheduling order ordering that all additional factual discovery on the breach of covenant claim be concluded by September 29, 2006. [Docket Item No. 32.] On October 30, 2006, Uni-Marts filed a second motion for summary judgment to which Plaintiff filed opposition on November 21, ...