Eastern Adhesives v. Scapa N Amer Inc , 305 F. App'x 33 ( 2008 )


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  •                                                                                                                            Opinions of the United
    2008 Decisions                                                                                                             States Court of Appeals
    for the Third Circuit
    12-31-2008
    Eastern Adhesives v. Scapa N Amer Inc
    Precedential or Non-Precedential: Non-Precedential
    Docket No. 07-2590
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    Recommended Citation
    "Eastern Adhesives v. Scapa N Amer Inc" (2008). 2008 Decisions. Paper 24.
    http://digitalcommons.law.villanova.edu/thirdcircuit_2008/24
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    NOT PRECEDENTIAL
    UNITED STATES COURT OF APPEALS
    FOR THE THIRD CIRCUIT
    No. 07-2590
    EASTERN ADHESIVES, INC.,
    Appellant
    v.
    SCAPA NORTH AMERICA, INC.
    On Appeal from the United States District Court
    for the Eastern District of Pennsylvania
    D.C. Civil Action No. 06-cv-1727
    (Honorable J. Curtis Joyner)
    Submitted Pursuant to Third Circuit LAR 34.1(a)
    November 20, 2008
    Before: SCIRICA, Chief Judge, RENDELL, Circuit Judge,
    and O’CONNOR, Retired Associate Justice *
    (Filed: December 31, 2008)
    OPINION OF THE COURT
    *
    The Honorable Sandra Day O’Connor, Retired Associate Justice of the Supreme
    Court of the United States, sitting by designation.
    SCIRICA, Chief Judge.
    Eastern Adhesives appeals an order of the District Court denying its motion for
    leave to file a Second Amended Complaint and granting Scapa North America’s motion
    to strike the Second Amended Complaint. Eastern Adhesives’s pleadings alleged Scapa
    breached a 2001 oral contract. Under the agreement, Scapa would supply Eastern
    Adhesives’s requirements of a tape product, SP357-.003, for resale to a third party, and
    Scapa would not itself sell SP357-.003 or similar products to the third party. Because the
    alleged agreement was for more than five-hundred dollars and made orally, we consider
    whether the Pennsylvania statute of frauds, 13 Pa. Cons. Stat. § 2201, bars enforcement of
    Eastern Adhesives’s claims.1
    I.
    At the outset we must address waiver because four of Eastern Adhesives’s
    arguments were neither raised in the District Court nor were grounds for the District
    Court’s judgment. “Generally, failure to raise an issue in the District Court results in its
    waiver on appeal.” Huber v. Taylor, 
    469 F.3d 67
    , 74 (3d Cir. 2006). Eastern Adhesives
    makes four new arguments: (1) the merchant’s exception to the statute of frauds in 13 Pa.
    Cons. Stat. § 2201(b) applies; (2) the § 2201(c)(3) exception to the statute of frauds
    regarding goods received and accepted applies; (3) Scapa waived the statute of frauds
    1
    The District Court had diversity jurisdiction under 28 U.S.C. § 1332, and we have
    jurisdiction under 28 U.S.C. § 1291.
    2
    defense because oral agreements are the standard practice in the trade, see Atl. Paper Box
    Co. v. Whitman’s Chocolates, 
    844 F. Supp. 1038
    , 1043–45 (E.D. Pa. 1994); and (4) under
    ALA, Inc. v. CCAIR, Inc., 
    29 F.3d 855
    (3d Cir. 1994), a plaintiff can survive a Rule
    12(b)(6) motion if the defendant might admit the existence of the contract in its pleadings,
    discovery, or in court. Because Eastern Adhesives did not raise these issues in the
    District Court2 and because they were not part of the District Court’s holding, they are
    waived and we address only Eastern Adhesives’s two remaining claims.3
    II.
    Eastern Adhesives contends the letters it exchanged with Scapa in 2002 and which
    it attached to the Complaint are sufficient to satisfy the statute of frauds. A contract for
    the sale of goods for five hundred dollars or more is not enforceable “unless there is some
    writing sufficient to indicate that a contract for sale has been made between the parties
    and signed by the party against whom enforcement is sought.” 13 Pa. Cons. Stat. §
    2
    Eastern Adhesives made four and only four arguments before the District Court.
    First, Eastern Adhesives argued its course of dealing with Scapa should be interpreted to
    establish a contract. (Brief of Plaintiff Opposing Motion to Dismiss Amended
    Complaint, Supp. App. at 3–5.) Second, Eastern Adhesives argued a contract was made
    by way of an oral promise at a 2001 meeting and subsequent acceptance of that promise.
    (Id.) Third, Eastern Adhesives argued it had made out a claim for promissory estoppel.
    (Id. at 5–6) Fourth and finally, Eastern Adhesives made procedural arguments in support
    of a motion for leave to file the Second Amended Complaint: despite filing the Second
    Amended Complaint late, Eastern Adhesives argued the District Court had discretion to
    accept the Second Amended Complaint. (Brief of Plaintiff Opposing Motion to Strike
    Second Amended Complaint, App. at 86–87.)
    3
    To the extent Eastern Adhesives has raised promissory estoppel claims on appeal, it’s
    pleadings do not claim reliance damages.
    3
    2201(a). Eastern Adhesives argues a letter it sent Scapa in June 2002, which refers to an
    “account protection agreement,” 4 established the context for Scapa’s signed, written
    responses in July and October 2002. Because these subsequent communications fail to
    disclaim such an agreement, the argument goes, Scapa’s letters admit the agreement.
    To the extent Eastern Adhesives suggests the merchant’s exception to the statute of
    frauds applies because Scapa failed to object, the argument is waived. 
    See supra
    . To the
    extent Eastern Adhesives suggests Scapa’s letters incorporated the assertion of an
    agreement by reference in its own signed writings, the letters attached to the pleadings
    provide no support. Scapa’s letters do not refer to an account protection agreement. They
    recognize Eastern Adhesives lost one of its clients when Scapa began selling directly to
    that client. Additionally, they acknowledge Scapa sought to avoid losing Eastern
    Adhesives for other business. These documents do not refer to Eastern Adhesives’s
    assertions of an account protection agreement, nor do they demonstrate a requirements
    4
    Eastern Adhesives’s June 2002 letter identifies a different agreement than the one
    identified in the pleadings. The pleadings suggest Rakesh Kumar and Joe Craig entered
    into an oral contract in 2001. The account protection agreement identified in the June
    2002 letter purportedly involved Chris Thomas and Marvin Hickman and was purportedly
    entered into “several years ago,” notably in a year prior to 2001. (App. at 16.)
    Eastern Adhesives admitted before the District Court, however, that prior to the 2001 oral
    promise alleged in the pleadings, no agreement existed. (Supp. App. at 5) (noting that at
    the time of the 2001 agreement, “[e]ither party could have ceased doing business with the
    other at any time”). Accordingly, by Eastern Adhesives’s own admission, the June 2002
    letter claimed a contractual relationship that did not exist. The statute of frauds guards
    against enforcement.
    4
    contract between Eastern Adhesives and Scapa. Accordingly, the letters do not satisfy the
    statute of frauds.
    III.
    Second, Eastern Adhesives contends Scapa’s Connecticut state-court action admits
    the exclusive requirements contract. A contract is enforceable if “the party against whom
    enforcement is sought admits in his pleading, testimony or otherwise in court that a
    contract for sale was made.” 
    Id. § 2201(c)(2).
    The contract, however, “is not enforceable
    under this provision beyond the quantity of goods admitted.” 
    Id. Eastern Adhesives
    does
    not identify a quantity of goods in the Connecticut Complaint, much less an agreement to
    fill its requirements. Accordingly, because the contract cannot be enforced beyond the
    quantity admitted, 
    id., and Eastern
    Adhesives does not identify the quantity, Scapa’s
    Connecticut action does not satisfy the statute of frauds.
    IV.
    For the foregoing reasons, we will affirm the judgment of the District Court.
    5