May 24, 1995 [NOT FOR PUBLICATION]
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
No. 94-2096
NABIH AOUDE,
Plaintiff, Appellant,
v.
MOBIL OIL CORPORATION,
Defendant, Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Richard G. Stearns, U.S. District Judge]
Before
Boudin, Circuit Judge,
Campbell, Senior Circuit Judge,
and Stahl, Circuit Judge.
Jeffrey A. Gorlick with whom Law Offices of Robert E. Weiner was
on brief for appellant.
Edward C. Duckers with whom Lowell R. Stern, Hogan & Hartson,
Thomas J. Sartory and Goulston & Storrs, P.C. were on brief for
appellee.
Per Curiam. This case arises because Mobil Oil
Corporation sought to terminate the franchise of its
distributor Nabih Aoude. Aoude had for a number of years
operated Aoude Mobil as a retail gasoline station in Medway,
Massachusetts; the agreement between Aoude and Mobil forbade
Aoude from using Mobil's name in connection with the sale of
any other brand of gasoline. On February 28, 1992, Mobil
proposed to terminate Aoude's franchise for violation of this
restriction and Aoude immediately filed suit in district
court. After staying the termination, the district court
granted summary judgment in favor of Mobil. On Aoude's
appeal we consider the propriety of summary judgment de novo,
drawing all reasonable inferences in favor of Aoude.
Maldonado-Denis v. Castillo-Rodriquez, 23 F.3d 576, 581 (1st
Cir. 1994).
Under the Petroleum Marketing Practices Act, 15 U.S.C.
2801 et seq., Mobil was entitled to terminate the
franchise for "willful" mislabeling or misbranding of motor
fuel. 15 U.S.C. 2802(c)(10). Based on the record before
it, the district court ruled that it was beyond reasonable
dispute that on February 6, 1992, somewhere between 200 and
300 gallons of non-Mobil gasoline were diverted from another
nearby station (controlled by Aoude and managed by his
brother) and deposited in one of the tanks at Aoude's Mobil
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station. The gasoline in the tank was subsequently offered
for sale through Mobil-labeled facilities.
On this appeal, Aoude purports to dispute the
determination that the 200 plus gallons were deposited in the
Aoude Mobil station tank, but this claim is frivolous. The
driver who delivered the gasoline gave uncontradicted
testimony that he had deposited the gasoline in the Aoude
Mobil tank. This direct testimony was supported by two
eyewitnesses, who saw the truck parked at the Mobil Station
apparently unloading, and by Aoude's own tank measurements,
which showed that on February 7 one of his tanks had an
unexplained surplus of about 275 gallons. Based on the
evidence, no reasonable juror could doubt that 200 plus
gallons were delivered to Aoude, stored in one of his tanks,
and ultimately sold to the public.1
It is also irrelevant under the law that samples of the
gasoline, collected by Mobil representatives on the day of
the misdelivery, showed no insufficient concentration of
Mobil additives: it would not be a defense to misbranding or
mislabeling that the non-Mobil gasoline delivered by the
truck was too small an amount to dilute seriously the Mobil
gasoline in the tank. "Misbranding occurs when a franchisee
1Given the uncontradicted testimony that the gasoline
was deposited in Aoude's tank, we do not think that a
material factual dispute is created by some confusion as to
which of Aoude's several tanks was thus filled. Aoude has
offered nothing else to contradict the driver's testimony.
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passes off other gasoline as that of the franchisor's by
dispensing the gasoline through pumps and at stations bearing
the franchisor's logo." Dandy Oil, Inc. v. Knight
Enterprises, Inc., 654 F. Supp. 1265, 1270 (E.D. Mich.),
appeal dismissed, 830 F.2d 193 (6th Cir. 1987).
Aoude's only serious claim on appeal is that the
requirement of willfulness in the statute presents an issue
of material fact in this case. Although this requirement has
not been widely parsed, both Aoude and Mobil cite us to the
Ninth Circuit's decision in Retsieg Corp. v. ARCO Petroleum
Prods., 870 F.2d 1495 (9th Cir. 1988), as reflecting a proper
standard. There, the Ninth Circuit said that to be willful
the dealer's act must be done "either with an intentional
disregard of, or plain indifference to, the requirements of
the franchise agreement." Id. at 1498. This appears to us
to be a plausible gloss of the statute and, in the absence of
any developed argument for a different legal standard, we
follow this aspect of Retsieg in this case.
There is no reason to describe the somewhat unusual
events surrounding the diversion of the gasoline to Aoude's
Mobil station because the district court rested its judgment
of willfulness on events occurring after the delivery. The
district court determined that Aoude was given notice on
February 6 that he likely had received a delivery of non-
Mobil gas; that this was confirmed by his own measurements on
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February 7; and that his failure either to halt sales or make
a serious investigation of the matter amounted to plain
indifference to his obligation to avoid the sale of
misbranded gasoline.
What the record shows is that on February 6 Mobil was
tipped off by a telephone call from an Aoude competitor
(located across the street from Aoude's station) that a
delivery had been made to Aoude Mobil from a non-Mobil tank
truck. Representatives from Mobil visited Aoude later that
same day and told him that they had information indicating
that he had received the improper delivery. Although Aoude
offered some evidence that he had told an employee to make
some inquiries that same day, he did little to investigate
the matter seriously or to halt sales when, on the following
day, his own measurements confirmed that a significant amount
of unaccounted for gasoline was contained in his station
tank. He could easily have investigated since he knew the
name of the company that had dispatched the tanker and
apparently knew that it had made its main delivery at his own
non-Mobil station down the road.
Although Aoude says that willfulness is not normally a
matter to be resolved on summary judgment, we have no
difficulty concluding that his objective behavior from
February 7 onward--given what he was admittedly told by the
Mobil representatives and what he learned from his own
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measurements--constituted plain indifference to his
obligations. Aoude further objects that the Mobil
representatives told him only that non-Mobil gasoline "may"
have been deposited in his tank; but Aoude was also told by
his own employee that the non-Mobil truck had been at his
station, and his own measurements on the following day
confirmed that such a delivery had occurred.
Under these circumstances, we need not rely upon other
evidence suggesting that Aoude had earlier engaged in selling
non-Mobil gasoline from the same Mobil station. Accordingly,
there is no need to resolve the question raised by Aoude
whether such evidence was presented to the district court in
an admissible form and whether any such objection to
admissibility has been waived.
Affirmed.
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