United States District Court, D. New Jersey
AKM International, LLC ("AKM") and Chun-Chien Lin
("Mr. Lin") (collectively, "Plaintiffs")
bring this action against Defendants Jerry Chen ("Mr.
Chen"), Lash Volkswagen, Inc., MGD, LLC
("MGD"), and New Country Audi Motor Cars of
Greenwich, Inc. ("New Country"). The Complaint, in
eight counts, asserts claims of tort and breach of contract
arising from the defendants' alleged incomplete
performance of a contract to deliver several BMW motor
vehicles. Essentially, Plaintiffs contend that Jerry Chen
sold them some new BMWs (for resale to a third party in
China), which he failed to deliver. The issue on this motion
is whether Mr. Chen was acting as the actual or apparent
agent of New Country when he did that. Now before the Court
is Defendant New Country's motion (ECF no.
for summary judgment.
reasons set forth below, the evidence fails to raise any
material issue of fact as to the viability of Plaintiffs'
claims against New Country. Summary judgment in favor of New
Country on all counts will be granted.
Chun-Chien Lin is the sole principal and owner of AKM, a New
Jersey limited liability company. (Def. Facts ¶¶
2-4) New Country is an Audi motor vehicle dealership located
in Greenwich, Connecticut. (Id. ¶ 1)
Connecticut's motor vehicle laws prohibit New Country, as
an Audi dealership, from selling new BMWs. (Id.
¶ 36) Defendant MGD is a Connecticut limited liability
company. [Id. ¶ 7)
October 7, 2011, Defendant Jerry Chen,  a New Country
salesperson, left work early and never returned to New
Country. (PI. Opp. Ex. F) A week later, on October 14, 2011,
Mr. Chen offered to sell the Plaintiffs eight new BMW X5 motor
vehicles (the "BMWs"). (Id. ¶ 16) On
that date, Mr. Chen sent an e-mail message from his New
Country e-mail account to Mr. Lin, offering "MSRP
[manufacturer's suggested retail price] less $750 off
only for you my brother." (PL Opp. Ex. D)
Chen testified that Mr. Lin was not the "ultimate
purchaser" but a reseller or agent. (Def. Mot. Ex. D,
Chen Dep. 91:5-7) The client of Lin and MGD, i.e.,
the ultimate purchaser of the eight new BMWs, was a third
party in China. On October 14, 2011, that Chinese third
party made a $70, 000 wire transfer payment to MGD. (Def.
Facts ¶¶ 17-19; PI. Facts ¶¶ 17-19)
Subsequently, the same client made four additional wire
transfer payments, totaling $453, 400, to MGD's account.
[Id. ¶¶ 18-19) And the communications
between Mr. Chen and Plaintiffs regarding the BMWs, said
Chen, had "nothing to do with New Country." (Def.
Mot. Ex. D, Chen. Dep. at 110:15-24). (Def. Facts ¶ 21)
the BMWs were delivered to the Plaintiffs as promised. (PL
Facts ¶ 22) Those vehicles were purchased from various
BMW dealerships: BMW of Westchester, Hassel BMW, or BMW of
New London. (Def. Facts ¶ 34) None of those
delivered vehicles, testified Mr. Chen, were purchased from
New Country. (Def. Facts ¶ 29)
remaining three BMWs-the ones that were not
delivered as promised-are the subject of Plaintiffs'
Complaint. Those three did not come from New Country, either.
Rather, individuals from Clifton, NJ, Bensalem, Pennsylvania,
and West Sayerville, New York purchased those BMWs from
Hassel BMW. (Def. Facts ¶¶ 30, 35; PI. Facts ¶
testified that he never signed a contract with, received an
invoice from, or transferred money to, New Country. (Def.
Facts ¶ 25) Plaintiffs have offered no evidence that New
Country had any control over the payments wired to MGD.
Nevertheless, Mr. Lin states that he believed Mr. Chen was
acting on behalf of New Country and that MGD was a part of
New Country. (PI. Facts ¶¶ 17-18, 25) The
plaintiffs contend that Chen acted as New Country's
employee or agent in the transaction. (See Pl Facts
¶¶ 20 - 21, 24, 26, 29, 31-35)
Mr. Chen did not formally resign from New Country, there
seems to be no dispute that he quit at some point. According
to a November 2, 2011 letter from then-New Country General
Sales Manager Mark DeMarsico, Mr. Chen was removed from New
Country's payroll as of October 31, 2011 for job
abandonment. Mr. DeMarsico's letter describes the
circumstances leading to the termination of Mr. Chen's
employment at New Country:
On Friday October 7th 2011 Gee Chen texted
messaged Julia Glaser here at New Country Audi Sales stating
he was leaving early from work he was not feeling well, he
followed up on Saturday October 8th that [h]e was
going to be in the hospital for a few days and has not
returned to work since.
I Mark DeMarsico the general sales manager have called his
cell phone several times to question whether he was returning
to work or not and Mr. Chen has not returned any of the
calls. He has contacted David Uva to say he was still not
feeling well and to question him about deals. He has not
called or contacted any of the management staff making us
aware he was not coming in or coming back to work.
I requested and have waited for three weeks to receive a
letter from him regarding a leave of absence for medical
reasons and have received nothing, As of October
31st 2011 Gee Chen should be removed from payroll
for job abandonment.
General Sales Manager
New Country Audi
(Def. Mot. Ex. H)
Chen began working at Lash Auto Group shortly after leaving
New Country. This is corroborated by evidence that on October
21, 2011, Lash Volkswagen direct-deposited $450 into
Chen's HSBC checking account. (Def. Facts ¶ 27; Def.
Mot. Ex. F) Chen testified at his deposition that he was
employed at Lash Volkswagen when all of the wire transfers
from Plaintiffs' client to MGD for the BMWs occurred, all
the way back to the first transfer on October 14, 2011. (Def
Facts ¶ 28; see also Chen Dep. 154:1-13)
January 17, 2014, New Country filed a complaint in
Connecticut State Superior Court against a former employee,
David Uva. New Country's claim arose from a scheme in
which Uva allegedly sold Audi automobiles from New Country to
an export buyer, in violation of Audi and New Country
policies. (PI. Opp. Ex. A) In that state court complaint, New
Country alleged that Uva and his co-conspirators received
payments from the export buyers through MGD, which, at a
profit, supplied Audi automobiles that MGD purchased from New
Country. (Id.) Relatedly, on December 1, 2014, New
Country filed a complaint against Mr. Uva in bankruptcy court
in the District of Connecticut, seeking to have Uva's
liability to them declared non-dischargeable. (PI. Opp. Ex.
February 10, 2014, Plaintiffs filed the Complaint in this
action in New Jersey state court. (Def. Facts ¶ 8) On
April 4, 2014, New Country removed the action to federal
court. To date, Plaintiffs have not served process on
Defendants MGD and Lash Volkswagen. [Id. ¶ 10)
November 18, 2016, New Country filed its motion for summary
judgment. (ECF no. 30) That motion is now before the Court.
Summary Judgment Standard
Rule of Civil Procedure 56(a) provides that summary judgment
should be granted "if the movant shows that 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); see also Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 248, 106 S.Ct. 2505 (1986); Kreschollek v. S.
Stevedoring Co., 223 F.3d 202, 204 (3d Cir. 2000). In
deciding a motion for summary judgment, a court must construe
all facts and inferences in the light most favorable to the
nonmoving party. See Boyle v. County of Allegheny
Pennsylvania, 139 F.3d 386, 393 (3d Cir. 1998). The
moving party bears the burden of establishing that no genuine
issue of material fact remains. See Celotex Corp. v.
Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548 (1986).
"[W]ith respect to an issue on which the nonmoving party
bears the burden of proof . . . the burden on the moving
party may be discharged by 'showing'-that is,
pointing out to the district court-that there is an absence
of evidence to support the nonmoving party's case."
Id. at 325, 106 S.Ct. 2548.
moving party meets its threshold burden, the opposing party
must present actual evidence that creates a genuine issue as
to a material fact for trial. Anderson, 477 U.S. at
248, 106 S.Ct. 2505; see also Fed. R. Civ. P. 56(c)
(setting forth types of evidence on which nonmoving party
must rely to support its assertion that genuine issues of
material fact exist). "[U]nsupported allegations . . .
and pleadings are insufficient to repel summary
judgment." Schoch v. First Fid. Bancorporation,
912 F.2d 654, 657 (3d Cir. 1990); see also Gleason v.
Norwest Mortg., Inc., 243 F.3d 130, 138 (3d Cir. 2001)
("A nonmoving party has created a genuine issue of
material fact if it has provided sufficient evidence to allow
a jury to find in its favor at trial.").
Breach of Contract, Breach of Contract Implied at Law, and
"Specific Performance: Delivery of Goods and
Services" (Counts 1-3)
Breach of Contract
allege that, of the eight new BMWs that were promised, New
Country failed to deliver three. Under New Jersey law, a
breach of contract claim has three essential elements: (1)
the existence of a valid and enforceable contract between the
parties, (2) a breach of that contract, and (3) damages.
Murphy v. Implicito, 920 A.2d 678, 689 (
N.J.Super.Ct.App.Div. 2007); accord Frederico v. Home
Depot, 507 F.3d 188 (3d Cir. 2007).
Counts 1-3,  New Country argues that the breach of
contract claims founder on the first element: the existence
of an enforceable contract between New Country and
Plaintiffs. To establish the existence of a valid contract of
sale, "Plaintiff must show mutual assent, consideration,
legality of the object of the contract, capacity of the
parties and form[ality] of memorialization."
Fletcher-Harlee Corp. v. Pote Concrete Contractors,
Inc., 421 F.Supp.2d 831, 833 (D.N.J. 2006) (citing
Cohn v. Fisher, 118 N.J.Super. 286, 291, 287 A.2d222
Country argues that there is no evidence that it ever made an
offer to Plaintiffs to sell the BMWs or that Plaintiffs
formally accepted such an offer. (Def. Mot. 8) Indeed, aside
from Plaintiffs' repeated assertions that Mr. Chen was
acting on New Country's behalf, there is no evidence
connecting New Country to any agreement to sell the BMWs to
Plaintiffs or their Chinese clients. It is undisputed that
Plaintiffs never signed a contract with, received an invoice
from, or transferred money to, New Country. (Def. Facts
¶ 25) It is further undisputed that Plaintiffs were not
the "ultimate purchasers]" of the BMWs, and that
the communications between Mr. Chen and Plaintiffs regarding
the BMWs had "nothing to do with New Country."
(Def. Facts ¶ 21) The VINs of the five BMWs that were
delivered-which Plaintiffs allege were purchased from New
Country-demonstrate that they were not sold by New
Country, but by BMW of Westchester, Hassel BMW, or BMW of New
London. (Def. Facts ¶ 34) The three BMWs that were not
delivered -allegedly in breach of some contract with New
Country-were all sold by Hassel BMW, not New Country. (Def.
Facts ¶¶ 30, 35; Pl Facts ¶¶ 30, 35)
thus have no alternative but a theory of agency or apparent
authority. They hang their hats on the contention that Mr.
Chen was New Country's employee or agent-or, at least,
that he appeared to be. (PL Opp. 10-11; PI. Facts
¶¶ 20 - 21, 24, 26, 29, 31-35) Even assuming that
Chen had quit working for New Country, the Plaintiffs claim
that they reasonably relied on his apparent authority to act
on New Country's behalf. As an abstract legal matter,
they are correct: where an agent or other actor does not have
actual authority to affect a principal's legal relations
with a third party, an agent or actor may nevertheless
possess apparent authority. New Jersey Lawyers' Fund
for Client Prot. v. Stewart Title Guar. Co., 203 N.J.
208, 220, 1 A.3d 632, 639 (2010); Sears Mortg. Corp. v.
Rose, 634 A.2d 74, 79 (N.J. 1993); Restatement (Third)
Of Agency § 2.03 (2006). Where the theory falls apart is
not on the law but on the facts.
point out that the October 14, 2011 e-mail message from Mr.
Chen originated from his New Country e-mail. In that message,
Chen offered Mr. Lin "MSRP [manufacturer's suggested
retail price] less $750 off only for you my brother."
(ECF no. 31-5 at 1) Lin also testified that he would contact
Mr. Chen at his New Country phone number if he could not
reach him at his cellular phone number. (Lin Dep.
57:8-14) New Country, for its part, argues that Mr. Chen
abandoned his job at New Country on October 7, 2011, and had
begun employment at Lash Volkswagen by the time he made any