[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT FILED
________________________ U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
No. 08-15078 JUNE 30, 2009
________________________ THOMAS K. KAHN
CLERK
D. C. Docket No. 07-20181-CV-MGC
BURGER KING CORPORATION,
Plaintiff-Counter
Defendant-Appellee,
versus
E-Z EATING, 41 CORPORATION,
E-Z EATING 47 CORPORATION,
ELIZABETH SADIK,
LUAN SADIK,
E-Z EATING 8TH CORP.,
E-Z EATING 46TH CORP.,
Defendants,
Counter-Claimants,
Appellants.
________________________
Appeal from the United States District Court
for the Southern District of Florida
_________________________
(June 30, 2009)
Before BARKETT and FAY, Circuit Judges, and TRAGER,* District Judge.
FAY, Circuit Judge:
This litigation involved the operation of several Burger King franchise
restaurants in the New York area by Appellants Elizabeth and Luan Sadik and their
corporate entities. The parties brought multiple claims and counterclaims against
each other in three separate lawsuits. These cases were consolidated before Judge
Cooke, who held numerous hearings before issuing two final summary judgments
against Appellants.
The appeal pending here has been boiled down to one key question: whether
Appellee Burger King Corporation (“BKC”) violated an implied covenant of good
faith and fair dealing in failing to grant Appellants an exception to a system-wide
program known as the Value Menu. A subpart of this question is whether or not
Appellants properly requested such an exception. After reviewing the record,
studying the briefs, and hearing oral argument, we conclude that Appellants failed
to create a genuine issue as to whether they properly requested an exception to the
Value Menu. We therefore affirm the summary judgments against them.
I. FACTS
A. Background
*
Honorable David G. Trager, United States District Judge for the Eastern District of
New York, sitting by designation.
2
1. The Parties and Franchise Agreements
BKC is a Florida corporation that operates a world-wide system of both
company-owned and franchised fast-food restaurants. Through various corporate
entities,1 Appellants Elizabeth and Luan Sadik (“the Sadiks”) owned and operated
five of BKC’s franchised restaurants in New York City, New York. Four of the
Sadiks’ franchise restaurants are the subject of this action.2 All four restaurants
were “in-line” restaurants - that is, they were not free-standing buildings. They
were as follows:
Number Location Date of Franchise Agreement
BK #12287 777 8th Avenue March 10, 1999
New York, NY
BK #12288 55 West 46th Street August 4, 1999
New York, NY
BK #11100 485 5th Avenue October 15, 1997
New York, NY
BK #13447 129 East 47th Street February 2, 2001
New York, NY
1
These corporate entities are: E-Z Eating 8th Corporation, E-Z Eating 41st Corporation,
E-Z Eating 46th Corporation, and E-Z Eating 47th Corporation.
2
As explained below, this case involves the following three cases which were
consolidated on January 30, 2008: (1) Burger King Corp. v. E-Z Eating 8th Corp., E-Z Eating
46th Corp., Luan Sadik & Elizabeth Sadik, Case No. 07-20181; (2) Burger King Corp. v. E-Z
Eating 41 Corp., EZ Eating 47 Corp., Luan Sadik & Elizabeth Sadik, Case No. 08-20155; and
(3) E-Z Eating 41 Corp., E-Z Eating 47 Corp., Luan Sadik & Elizabeth Sadik v. Burger King
Corp., Case No. 08-20203.
3
The Sadiks entered into four identical Franchise Agreements3 with BKC,
assigned the Agreements to corporate entities they had created for each of the
restaurants, and personally guaranteed the corporate entities’ obligations. Several
provisions of the Franchise Agreements are of particular relevance here.
According to Section 5(A), the franchisee agreed to adopt and adhere to the
operating procedures outlined in BKC’s Manual of Operating Data (“MOD
Manual”). Further, Section 5(A) provided that the franchisee “agrees that changes
in the standards, specifications and procedures may become necessary and
desirable from time to time and agrees to accept and comply with such
modifications, revisions and additions to the MOD Manual which BKC in the good
faith exercise of its judgment believes to be desirable and reasonably necessary.”
Pursuant to Section 6(I), BKC agreed to provide “[s]uch ongoing support as
BKC deems reasonably necessary to continue to communicate and advise
FRANCHISEE as to the Burger King System including the operation of the
Franchised Restaurant.”
Section 18(A)(9) provided that abandonment of a franchise restaurant
(defined as cessation of operations) without BKC’s consent would constitute a
3
We refer to the Franchise Agreements based on the number of the restaurant to which
they pertained - for example, “the #12287 Franchise Agreement.” We also refer to the
restaurants themselves based on their numbers - for example, “BK #12287.”
4
material act of default and good cause for BKC to terminate the Agreement.
Section 18(B) granted the franchisees a limited license to use BKC’s marks for as
long as the Agreements remained valid.
2. The Assistance Agreement
After several years in business the Sadiks’ restaurants became unprofitable,
and the Sadiks fell behind in their payments to BKC. As of April 18, 2005 the
Sadiks had defaulted on royalty payments, advertising fees, and other payments
required under the Franchise Agreements. The Sadiks were indebted to BKC for
$334,779.
The Sadiks began working with a BKC financial restructuring officer and
came up with a plan to make their restaurants viable again. On June 16, 2005 the
Sadiks signed a Guaranty in which they personally guarantied to BKC each and
every obligation the E-Z Eating corporate entities assumed in the Franchise
Agreements. On June 21, 2005, Appellants entered into an Assistance Agreement
in which they agreed to a payment schedule and also executed a Promissory Note
setting forth the terms on which they would pay their debts.
The Assistance Agreement included a cross-default provision. Specifically,
according to Section VII(B), the occurrence of an additional event of default under
any of the Franchise Agreements subsequent to June 21, 2005 would constitute
5
“Event of Default” as defined by the Assistance Agreement. According to Section
VIII, the occurrence of such an Event of Default would constitute a default under
every Franchise Agreement, and would automatically terminate each one without
further notice from BKC.
3. BKC’s Value Menu
On February 13, 2006 BKC sent a systemwide memorandum describing its
new “Value Menu” (the “Value Menu Memo”). The Memo explained that while
BKC’s general policy was to allow franchisees to set prices for the products they
sold, BKC was instituting a special Value Menu with items to be sold at certain
maximum price points established by BKC. The Memo stated that the Value Menu
was “a required menu item and, as such, must be sold in all U.S. restaurants unless
an exception is granted pursuant to this policy memo.” Further, the Memo stated,
failure to comply would be considered a default under the applicable franchise
agreement.
Regarding the Value Menu “exceptions,” the Memo explained that “[t]here
are certain very limited exceptions to this Policy, which BKC may grant in its sole
and absolute discretion.” The Memo outlined three different exceptions: for
restaurants with limited access, for in-line restaurants, and for restaurants located
in a highly seasonal tourist destination. Each exception had its own specific
6
criteria. The criteria for the in-line exception were: “(1) the restaurant must be an
in-line restaurant, and not a free-standing building; (2) the restaurant must not have
a drive-thru; and (3) no FFHR4 competitor in the trade area is offering a value
menu in accordance with the competitive chain’s standard national value
proposition.” The Memo instructed franchisees who wished to qualify under the
in-line exception to “provide a written request to their DVP [Division Vice-
President] for an ‘in-line’ exception.”
After receiving the Memo the Sadiks did not institute the Value Menu in
their four franchise restaurants. On March 17, 2006 BKC Assistant General
Counsel Stephanie Doan sent a “Demand for Compliance” letter to the Sadiks.
This Demand informed the Sadiks that if all four of their franchise restaurants did
not begin complying with the Memo and offering the Value Menu items at the
maximum price points within forty-eight hours, BKC would declare a default in all
four Franchise Agreements. The Demand stated that if the Sadiks believed they
met the requirements for an exception to the Value Menu policy, they must submit
a “written request, along with documentation” to the Division Vice-President. The
Demand further stated that the terms of the Letter itself “may be modified only by
a written modification under [Ms. Doan’s] signature or the signature of another
4
Although we could not find a definition for this acronym in the briefs or the record, we
believe it refers to “fast food hamburger restaurant.”
7
BKC attorney” and that the Sadiks “[could not] rely on oral communications, and
any reliance on oral communications is unwarranted.”
Oliver Griffin, an attorney for the Sadiks and their corporate entities,
responded to the Demand for Compliance with a letter addressed to Ms. Doan. Mr.
Griffin’s letter, dated March 20, 2006, stated that although the Sadiks had changed
the menus at their restaurants to comply with the Value Menu Memo, they believed
that the restaurants “[fell] within the allowable exceptions to BKC’s policy
directives found in the [Value Menu Memo].” The letter continued:
Nevertheless, I understand that BKC has required my clients to make
a formal application for the exception, which BKC will then
investigate the substance of before it issues an opinion - this does not
make sense for a number of reasons, which I would like to discuss
with you over the phone.
Therefore, upon receipt of this letter, please call me in order to discuss
this matter, as well as other matters relevant to the ongoing
relationship between BKC and my clients.
Finally, and as you probably are aware, BKC has called a meeting
between it and my clients, which is tentatively scheduled to take place
on April 1, 2006. I would like to know, among other things, what
BKC’s agenda for this meeting is, in order that we can properly
prepare for it.
Mr. Griffin sent another letter to Ms. Doan dated April 12, 2006
stating that “my clients qualify for an exemption from the [Value Menu]
program, yet for reasons that are unclear, BKC will not agree to the
8
exemption.”
Ms. Doan responded to Mr. Griffin on April 17, 2006 with the
following email:
I am in receipt of your letter dated April 12, 2006. I have not
had the opportunity to discuss the Value Menu exemption
request with my clients. [BKC] has specific guidelines
regarding the BURGER KING restaurants eligible for
exemption. If the E-Z Eating Corporations submitted written
requests and back up data for an exemption at a restaurant or
restaurants as required, and they did not receive an exemption,
then those restaurants do not meet the qualifications to be
exempted from the BK Value Menu. The BK Value Menu is a
required menu item unless an exemption is granted based on the
defined criteria.
On April 19, 2006 Mr. Griffin wrote back: “[Ms. Doan], please
discuss the value meal exemption with your client and get back to me,
as that was a key point of my letter.” On April 22, 2006 Ms. Doan
replied: “I asked the [DVP], the local business person and the local
marketing person and nothing was submitted to them. Can you tell
me where they sent the exemption request?” No further letter or email
exchanges on this topic appear in the record.
4. The Closing of Two Restaurants: BK #12287 and BK #12288
The #12287 Franchise Agreement provided that the 8th Avenue location was
9
to remain open for business until January 11, 2011.5 The #12288 Franchise
Agreement provided that the 46th Street location was to remain open for business
until August 3, 2019. In January 2007 the Sadiks stopped operating BK #12287.
Two months later, they stopped operating BK #12288.
In a letter to the Sadiks dated January 17, 2008 Ms. Doan formally declared
the remaining two Franchise Agreements terminated. Specifically, Ms. Doan
stated that in ceasing operations at BK #12287 and BK #12288 without BKC’s
written consent, the Sadiks had breached the Franchise Agreements corresponding
to those establishments. Ms. Doan stated that in defaulting on two of their
Franchise Agreements, the Sadiks had thus defaulted on the Assistance Agreement
itself pursuant to Section VII(B) of that document. Ms. Doan invoked Section VIII
of the Assistance Agreement to declare the remaining Franchise Agreements
terminated - that is, the #11100 and #13447 Franchise Agreements. The letter
informed the Sadiks that they were to cease operations at those two establishments
and also to cease using any of BKC’s marks.
B. Procedure
On January 23, 2007 BKC sued over the premature closure of BK #12287 -
5
We note that while BKC and the district court refer to January 11, 2011 as the end date
of the #12287 Franchise Agreement, according to the Agreement itself January 15, 2011 is the
end date. Ultimately, however, this discrepancy does not affect our decision.
10
specifically, BKC sued E-Z Eating 8th for breach of the #12287 Franchise
Agreement, and sued the Sadiks for breach of their Guaranty of that Agreement.
That case came before Judge Cooke of the U.S. District Court for the Southern
District of Florida (the “Cooke Action”). On April 25, 2007 BKC filed its
Amended Complaint adding E-Z Eating 46th as a defendant. The Amended
Complaint sued E-Z 46th for breach of the #12288 Franchise Agreement, and the
Sadiks for breach of their Guaranty of that Agreement. Appellants E-Z 8 th, E-Z
46th , and the Sadiks counterclaimed against BKC for common law fraud, breach of
contract (specifically, for breaching Section 6(I) of the Franchise Agreements in
imposing the Value Menu), breach of implied duty of good faith and fair dealing
(in imposing the Value Menu), and promissory estoppel.6
On November 30, 2007 BKC moved for summary judgment on its Amended
Complaint and on Appellants’ Counterclaims. After BKC’s Motion for Summary
Judgment was briefed, but before the district court’s decision, BKC terminated the
#11100 and #13447 Franchise Agreements based on a cross-default provision in
Section VII(B) of the Assistance Agreement. On January 22, 2008 BKC filed a
lawsuit against the Sadiks, E-Z Eating 41st, and E-Z Eating 47 th before Judge
Jordan (the “Jordan Action”) for claims of trademark infringement and unfair
6
Appellants later voluntarily dismissed the counts for common law fraud and
promissory estoppel without prejudice.
11
competition, breach of the #11100 and #13447 Franchise Agreements, breach of
the Assistance Agreement, breach of the Promissory Note, breach of the #11100
and #13447 Guaranties, and breach of the 2005 Guaranty, all based on the fact that
BK #11100 and BK #13447 were still open for business even though BKC had
terminated the corresponding Franchise Agreements. BKC also filed a motion for
a preliminary injunction, requesting that Appellants cease operating BK #11100
and BK #13447 under the BKC name.7 Appellants also filed a counterclaim in the
Jordan Action asserting claims for declaratory judgment, breach of contract, and
breach of implied duty of good faith and fair dealing.
On January 24, 2008 the Sadiks, E-Z Eating 41st, and E-Z Eating 47 th filed a
lawsuit against BKC before Judge Ungaro (the “Ungaro Action”). They raised
claims for declaratory judgment, breach of contract (specifically, Section 6(I) of
the Franchise Agreements), and breach of the implied duty of good faith and fair
dealing.8 They also sought injunctive relief in the Ungaro Action to prevent BKC
from terminating the #11100 and #13447 Franchise Agreements and forcing them
to close BK #11100 and BK #13447.
7
The court granted the Motion for Preliminary Injunction on February 11, 2008, thus
requiring Appellants to close BK #11100 and BK #13447.
8
“Under Florida law, every contract contains an implied covenant of good faith and fair
dealing, requiring that the parties follow standards of good faith and fair dealing designed to
protect the parties’ reasonable contractual expectations.” Centurion Air Cargo, Inc. v. United
Parcel Serv. Co., 420 F.3d 1146, 1151 (11th Cir. 2005).
12
On January 30, 2008 Judge Cooke consolidated the Cooke Action, the
Jordan Action, and the Ungaro Action - all three cases now fell under Case
Number 07-20181, with Judge Cooke presiding.
On May 22, 2008 the district court granted BKC’s first Motion for Summary
Judgment as to liability only. The court held that E-Z 8th, E-Z 46th, and the Sadiks
defaulted on the #12287 and #12288 Franchise Agreements in ceasing operations
at BK #12287 and BK #12288 prior to the expiration of the Agreements without
BKC’s consent. In so holding, the court rejected Appellants’ affirmative defenses
of waiver/estoppel, laches, unclean hands, standing, impossibility of performance,
and failure to attach a writing. Further, the court granted summary judgment in
BKC’s favor on Appellants’ Counterclaims for breach of contract and breach of the
implied duty of good faith and fair dealing.
BKC filed another motion for summary judgment on June 6, 2008, this time
against all Appellants in the now-consolidated case. Specifically, BKC’s motion
sought summary judgment on these remaining claims: all claims originally raised
in the Jordan Action, all claims originally raised in the Ungaro Action, and BKC’s
requested damages in the original Cooke Action. In an order dated July 25, 2008
the district court granted summary judgment in BKC’s favor on the claims in the
Jordan and Ungaro Actions. The court also granted BKC permanent injunctive
13
relief prohibiting Appellants’ unauthorized use of BKC’s marks in connection with
BK #11100 and BK #13447. Regarding damages, the district court held that
Appellants owed BKC a total of $770,547.55 for past due royalties, outstanding
payments on the Promissory Note, and lost profits in connection with BK #12287
and BK #12288.
II. DISCUSSION
A. Standard of Review
“We review the trial court’s grant or denial of a motion for summary
judgment de novo, viewing the record and drawing all reasonable inferences in the
light most favorable to the non-moving party.” Patton v. Triad Guar. Ins. Corp.,
277 F.3d 1294, 1296 (11th Cir. 2002).
Under Federal Rule of Civil Procedure 56(c), summary judgment is proper
“if the pleadings, the discovery and disclosure materials on file, and any affidavits
show that there is no genuine issue as to any material fact and that the movant is
entitled to judgment as a matter of law.” See Celotex Corp. v. Catrett, 477 U.S.
317, 322 (1986). “[A] party seeking summary judgment always bears the initial
responsibility of informing the . . . court of the basis for its motion, and identifying
those portions of the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any, which it believes
14
demonstrate the absence of a genuine issue of material fact.” Id. at 323 (internal
quotations omitted). If the movant succeeds in demonstrating the absence of a
material issue of fact, the burden shifts to the non-movant to show the existence of
a genuine issue of fact. See Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1116 (11th
Cir. 1993).9
B. Analysis
In this appeal, Appellants only raise two challenges to the district court’s
rulings. First, they challenge the court’s grant of BKC’s motions for summary
judgment, arguing a genuine issue exists as to whether BKC “frustrated the
essential purpose of the franchise agreements . . . by arbitrarily and unreasonably
refusing to grant the Appellants an available [Value Menu] exception.” Initial Br.
at 2. Second, Appellants challenge the court’s grant of summary judgment in
BKC’s favor on their breach of implied covenant of good faith and fair dealing
claim.10 Appellants seek reversal and remand “with instructions to proceed to trial
9
We apply Florida law. “In a diversity case, a federal court applies the substantive law
of the forum state, unless federal constitutional or statutory law is contrary.” Ins. Co. of N. Am.
v. Lexow, 937 F.2d 569, 571 (11th Cir. 1991). The forum state here is Florida. The parties
agreed in Section 21(C)(1) of all four Franchise Agreements that Florida law would govern.
“[U]nder Florida law, courts will enforce choice-of-law provisions unless the law of the chosen
forum contravenes strong public policy.” Maxcess, Inc. v. Lucent Techs, Inc., 433 F.3d 1337,
1341 (11th Cir. 2005) (internal quotations and citations omitted).
10
“A breach of the implied covenant of good faith and fair dealing is not an independent
cause of action, but attaches to the performance of a specific contractual obligation.” Centurion
Air Cargo, 420 F.3d at 1151. Indeed, “[t]his court has held that a claim for a breach of the
implied covenant of good faith and fair dealing cannot be maintained under Florida law in the
15
on the E-Z Defendants claim for breach of the implied covenant of good faith and
fair dealing.” Id. at 34-35. Notably, Appellants do not challenge any of the district
court’s rulings on damages. We address both prongs of Appellants’ appeal below.
1. BKC’s Imposition of the Value Menu
Appellants argue that there is genuine issue of material fact as to whether
they had a defense to BKC’s breach of contract claims - specifically, as to whether
BKC frustrated the essential purpose of the Franchise Agreements in imposing the
Value Menu.
The district court held that BKC was entitled to impose its Value Menu on
Appellants by the terms of the Franchise Agreements. The court stated that
Section 6(I) gave BKC “discretion to decide whether to provide services and
[Appellants] have not pointed to a general failure on behalf of BKC . . . which
prevented them from operating their franchises.” May 22, 2008 O. at 12. The
court also noted that Section 5(A) of the Franchise Agreements “specifically
require[s] [Appellants] to adhere to BKC’s comprehensive restaurant format and
operating system.” Id. at 12-13.
We agree with the district court on this point. Section 5(A) of the Franchise
Agreements provided that the franchisee “agrees that changes in the standards,
absence of a breach of an express term of a contract.” Id. at 1152.
16
specifications and procedures may become necessary and desirable from time to
time and agrees to accept and comply with such modifications, revisions and
additions to the MOD Manual which BKC in the good faith exercise of its
judgment believes to be desirable and reasonably necessary.” There is simply no
question that BKC had the power and authority under the Franchise Agreements to
impose the Value Menu on its franchisees.
2. The Value Menu Exception
Appellants also argue that there is a genuine issue of material fact as to
whether BKC breached Florida’s implied covenant of good faith and fair dealing
by denying them an exception to the Value Menu. However, we must answer two
preliminary questions before we can address that issue. First, we must determine if
Appellants may raise this issue on appeal. Second, we must determine if a genuine
issue exists as to whether Appellants properly applied for an exception to the
Value Menu - if so, we can determine whether there exists a genuine issue as to
whether BKC should have granted such an exception.
a. Can Appellants raise this issue on appeal?
Appellants argue that a genuine issue exists as to whether BKC breached
Florida’s implied covenant of good faith and fair dealing by denying them a Value
Menu exception. As noted above, under Florida law this cause of action requires a
17
corresponding breach of an express contract term. See Centurion Air Cargo, 420
F.3d at 1151-52. Here, Appellants claim that in imposing the Value Menu and
refusing to grant an exception, BKC breached Section 5(A) of the Franchise
Agreements. BKC responds that Appellants cannot raise this argument on appeal
because they did not raise it to the district court11 - that is, Appellants only argued
breach of Section 6(I), not Section 5(A). Whether the issue was raised under a
specific paragraph of the contracts simply makes no difference - it clearly was
raised and resolved. Consequently, we find no merit in this argument.
b. Is there a genuine issue of material fact as to whether
Appellants properly applied for an exception?
BKC argues that even if Appellants are allowed to raise the issue of a Value
Menu exception, the district court judgment stands. This is because, BKC argues,
Appellants conceded that they did not apply for such an exception in writing to the
Division Vice-President Jim Joy, as the Value Menu memorandum and Demand
for Compliance explicitly required. Appellants respond that they did create a
genuine issue as to whether they properly applied in writing for a Value Menu
exception. They also argue that in any case, BKC waived the “in writing”
requirement by meeting with Mr. Sadik in person.
11
“Arguments raised for the first time on appeal are not properly before this Court.”
Hurley v. Moore, 233 F.3d 1295, 1297 (11th Cir. 2000).
18
We find that Appellants failed to establish a genuine issue as to whether they
submitted a written request for a Value Menu exception. Mr. Sadik admitted in his
deposition that he did not submit a written exception request, even though he was
aware that the Value Menu Memo required exceptions to be requested in writing.
See D.E. #128. Specifically, Mr. Sadik testified that at first he did not submit a
written request because he “assumed all New York was out. It says in-line stores.
My stores are in-line.” Mr. Sadik further testified that he only applied for the
exception “verbally” because he “assumed verbally was fine.” When asked
whether “anybody ever told [him] not to submit the written request,” Mr. Sadik
stated “no.”
Although Appellants point to Mr. Griffin’s two letters as support that they
did submit a written exception request, neither letter creates a genuine issue for
several reasons. First, the letters were addressed to Ms. Doan and not to Division
Vice-President Jim Joy, as the Value Menu Memo and Demand for Compliance
required. Second, neither letter actually asked for a specific exception, such as the
“in-line” exception - indeed, neither letter specified which of the three exceptions
the Sadiks sought, or why they qualified under a particular exception. Mr.
Griffin’s March 20 letter spoke generally of “the allowable exceptions,” stating
only: “it is our position that the EZ restaurants fall within the allowable exceptions
19
to BKC’s policy directives found in the [Value Menu Memo].” Moreover, Mr.
Griffin’s March 20 letter appears to expressly not comply with the formal
application requirement: “I understand that BKC has required my clients to make a
formal application for the exception, which BKC will then investigate the
substance of before it issues an opinion - this does not make sense for a number of
reasons, which I would like to discuss with you over the phone.” In his April 12
letter Mr. Griffin still did not mention which exception his clients sought, or why.
In fact, in that letter Mr. Griffin seemed to assume the Sadiks had already applied
for an exception: “my clients qualify for an exemption from the [Value Menu]
program, yet for reasons that are unclear, BKC will not agree to the exemption.”
Third, these letters did not include back-up documentation, as the Demand for
Compliance explicitly required.
As for Appellants’ argument that BKC waived its requirement for a written
exception request, we do not accept it. Under Florida law, “waiver” is defined as
“the voluntary and intentional relinquishment of a known right or conduct which
implies the voluntary and intentional relinquishment of a known right.” Raymond
James Fin. Servs., Inc. v. Saldukas, 896 So. 2d 707, 711 (Fla. 2005). Further,
according to Florida law, “[c]onduct may constitute waiver of a contract term, but
such an implied waiver must be demonstrated by clear evidence.” BMC Indus.,
20
Inc. v. Barth Indus., Inc., 160 F.3d 1322, 1333 (11th Cir. 1998); see also, e.g.,
Kirschner v. Baldwin, 988 So. 2d 1138, 1142 (Fla. 5th DCA 2008) (“When a
waiver is implied, the acts, conduct or circumstances relied upon to show waiver
must make out a clear case.”); Hale v. Dep’t of Revenue, 973 So. 2d 518, 522 (Fla.
1st DCA 2007) (“If a party relies upon the other party’s conduct to imply a waiver,
the conduct relied upon to do so must make out a clear case of waiver.”) (internal
quotations and citation omitted).
Here, there is scant evidence regarding a meeting between Mr. Sadik and
BKC representatives at which they discussed Appellants’ eligibility for a Value
Menu exception - too scant to create a genuine issue. Appellants have not alleged
when exactly the meeting was, where it was held, who specifically attended, what
the attendees said, or what sort of information was exchanged. Indeed, although
Mr. Sadik referred to such a meeting in an affidavit, he said only this: “I met with
the FBL and other BKC representatives and explained to them that the Value Menu
was going to drive me into insolvency . . . .” D.E. #115-2. Further, he stated:
“[t]hese BKC representatives told me that they were going to report back to BKC
corporate and then give me an answer as to whether or not I would be excepted
from the Value Menu (as in line stores qualify, and my stores were in line stores).”
21
Id.12
In contrast to Appellants’ vague evidence of a meeting in which BKC
waived its written request requirement, every communication in evidence from
BKC to the Sadiks on this topic invoked that requirement.13 Indeed, as is apparent
from Ms. Doan’s email exchange with Mr. Griffin, as late as April 22, 2006 BKC
representatives still assumed any Value Menu exception would be requested in
writing. On that date, Ms. Doan wrote to Mr. Griffin: “I asked the [DVP], the local
business person and the local marketing person and nothing was submitted to them.
Can you tell me where [the Sadiks] sent the exemption request?” Mr. Sadik also
admitted in his deposition that no one ever told him not to submit a written request.
We find there is simply not enough evidence to create a genuine issue as to
whether BKC waived its requirement that the Sadiks request a Value Menu
exception in writing.
Because Appellants failed to create a genuine issue as to whether they
12
Mr. Griffin also submitted an affidavit mentioning that Mr. Sadik met with BKC
representatives and that Mr. Griffin provided BKC representatives with the Sadiks’ “financials”
and documentation. However, this affidavit is far too vague to create a genuine issue as to
whether BKC waived its written exception requirement. As an aside, we are surprised at
Appellants’ reliance on Mr. Griffin’s affidavit since this could disqualify him as their attorney at
trial. See Fla. Stat. Bar Rule 4-3.7 (“A lawyer shall not act as advocate at a trial in which the
lawyer is likely to be a necessary witness on behalf of the client” except in certain limited
circumstances).
13
This evidence includes the Value Menu Memo itself, the Demand for Compliance
letter, and Ms. Doan’s April 17, 2006 and April 22, 2006 emails. See supra p. 6-9.
22
properly asked for a Value Menu exception, we need not address whether BKC
should have granted Appellants such an exception.
III. CONCLUSION
In sum, we find that BKC was clearly entitled to impose its Value Menu on
Appellants, and Appellants failed to establish a genuine issue of material fact as to
whether they properly applied for an exception from the Value Menu.
Accordingly, the judgment of the district court is
AFFIRMED.
23
Burger King Corp. v. E-Z Eating, 41 Corp.
Court: Court of Appeals for the Eleventh Circuit
Date filed: 2009-06-30
Citations: 572 F.3d 1306
Copy CitationsCombined Opinion