Hershey Foods Corporation v. Ralph Chapek, Inc.

SLOVITER, Bеfore BECKER GARTH, Judges. Circuit THE COURT OPINION OF GARTH, Judge: Circuit grant summa- appeal This is an from a in favor ry judgment by the district court Corporation behalf, against Hershey’s “Option Foods One” and Ralph Chapek, Inc. We affirm. committed to the 15%commission compensation arrangement pertained as it I. to Hershey’s return, chocolate milk. claims that it to undertake 13, 1981, Ralph Chapek, On Inc. specific the three research proposed studies firm, (Chapek), marketing consulting sent i.e., proposal, 13th the fresh unsolicited, seven-page licensing propos- chocolate milk and industry ice cream Corporation Hershey (Hershey), Foods al to study, impression the brand and attitude Chapek proposed Her- which to assist usage and study, marketing and a research assessing feasibility shey of market- study respect groups. six focus to ing Hershey’s milk chocolate and ice cream. App. at 65. App. proposal at 59-66. The outlined vari- by Chapek, ous studies be later, to undertaken as days Three on October marketing as plans well and research. Id. Chapek Pingitore and, wrote referring to licensing pro- at 62. The meeting, their October 27th set forth posal suggested options by two which Cha- Chapek into which and pek compensated. “Option Hershey would be One” entered. The es- provided sentially Chapek involved individual research studies be that would by Chapek. conducted It also form a chocolate milk Hershey for Chapek Hershey that would receive of the first and compensate Chapek would years royalties $17,500. and five fees received sum of dispute The instant Hershey Corporation Chapek Foods “for the licens- Hеrshey between and focuses on Hershey ing agreement: this, of the brand for use Chapek claiming Chocolate that Hershey in the manufacture and sale of October 30th par- cream, during tially integrated milk and ice agreement; chocolate Hershey years.”1 App. “Op- five at claiming complete integrated first 65. Under that it is the licen- parties. tion Two” would become the Hershey see Chocolate trademark 13,1981 addition to the licens- manufacture, for use sale and store- ing proposal for chocolate milk and ice Hershey delivery door chocolate milk cream Hershey, sent to which and option, Chapek ice and cream. Under this agreement involving October negotiate pay Hershey roy- and industry dairy and chocolate milk in- for alty products all sold with dustry study Hershey $17,- for whiсh paid Hershey chocolate brand name to proposals the record reveals other and sublicensing for to local dairies. agreements. Chapek six submitted addi- 27, 1981, Ralph Chapek, On proposals Hershey, tional each which president Chapek; inmet New York with projects. involved different research Products, An- pek proceed Director of New was directed with three of thony Pingitore, Chapek’s pro- projects. to discuss these additional research As to each, posal. Only separate agreement negotiat- two individuals present. contends at ini- proposals ed. The other six written made meeting, Pingitore agreed, orally by Chapek tial on were: Option proposed "professional One rela- a. and cream Fresh chocolate milk ice in- Hershеy tionship” Chapek provid- $17,500. between study. and dustry ed: impression b. and Brand and attitude us- Option One—Commission Base age study, intercept at $30.00 interviews years roy- 1. 15% commission on first five $22,500. per interview. alty by Hershey and fee received Foods Cor- $1,500 $9,000. groups c. Six focus at each. poration expenses, 3. Reimbursement of travel esti- brand use in Chocolate the manufacture professional at fees. mated 10% 15% of sale chocolate Milk and ice App. at 65. cream. marketing to conduct research assignment Hershey Corporation. Foods accepted by Consumer judgment declaring Hershey sought a Not shey re* chocolate milk search, implied any express claims free from (App. 81) (1/20/82) at Chapek. Accepted by Hershey proposal “50 Metro” Hershey paid (App. for which (10/7/82) 96-100) at magistratе held the October $50,000 Licensing to as the (referred by Chapek a result of 1981letter written “major strategy proposal or study) market” accepted 27th by Hershey Accepted analysis depth integrated incorporated every Hershey paid (App. which 114) (1/31/83) at as of that portion) scope study” $23,825 (“broad by Hershey Accepted magistrate held proposal further date. goods sweet Baked Hershey paid (App. 122-24) at (4/20/83) Chapek’s good claim could not faith (expenses portion) study” indud* (“broad law, sustained under ed) accepted by applicable, and that was deemed Not (1/31/83) novelties Frozen (App. 140-42) there promise” count failed because “false accepted Hershey chip Chocolate Not cookies evidence that there was fraudulent was no (App. 143-57) (4/20/83) part Hеrshey of and because intent on 22, 1983, Chapek On wrote Pennsylvania’s parol negate evi- it would claiming Hershey a commission calculated quantum meruit rule. As to the dence percent years’ of first on “fifteen five of count, magistrate favor ruled

royalties by Hershey and fees received exceptions. Ultimately, Hershey with two Hershey of Chocolate “exceptions” were removed from those manufacturing brand for use in and stipulation Her- effected between case sale of Chocolate Milk to the Chapek.2 at shey App. 445. and industry.” Supp.App., Ex. Plaintiff’s 20. magis- approved court district Hershey rejected Chapek's claim and ulti- recommendation, but report trate’s and mately brought this in the Middle action holding, stating magistrate’s modified the declaratory Pennsylvania District of re- of all fa- “giving Chаpek the benefit April 27, Hershey sought lief on reasonably might inferences vorable obligated declaration that it was not evidence, is a from the there drawn legal equitable Chapek, under theo- this to conclude basis for court reasonable ry, for commissions calculated on chocolate 30, 1981 October written contract licensing royalties milk and fees. integrates incorporates every and contract; counterclaimed for breach ment as of that date.” between the meruit; in quantum an for dam- award opinion, the district App. 408. In its own at ages implied for an of the covenant breach Hershey that the court with dealing; good faith and fair and for 1981, which Cha- agreement of October damages promise”. for “false part of its pek was claimed April 5, On moved for prosсribed by parol with was summary judgment. Hershey argued that offered rule it was evidence because breach contract claim should be dis- contradict, or otherwise vary, Chapek’s proof missed because of an oral 30, 1981 of the October attack the terms would be barred letter. It evidence rule. asked for dismissal good dealing faith and fair claim as not September On the district court recognized by sought Pennsylvania law. It judgment declaring entered a “Her- quantum meruit dismissal of the shey Corporation liability Foods has no misrepresentation Inc., fraudulent claims be- Ralph Defendant and the cause the material facts of case would Ralph Chapek Counterclaims of Defendant support such causes of action. Her- App. Inc. are dismissed.” at 451. granted judgment summary plans, relating 2. The district court ar- оlate milk to the those claims, legal eq- rangement meeting Hershey repre- on uitable, meruit ail of a Chapek's except personnel Dairy for those related to sentatives and Knudsen in Cali- parties by stipulation services rendered in two discrete transactions— fornia. The have elimi- gathering relating intelligence those this nated these two claims from the appeal. App. investigation with cerned of Nestle’s choc- Chapek appealed, appeal on Hershey agrees aban- compensate implied good pek: covenant of faith doned the promise.”

issue and the issue of “false Dairy Industry Study a. at project (see

with inception at 50% at- statement) tached invoice 50% II. project completion, completion with date that, Chapek argues аppeal un estimated for February 1982 or soon- law,3 der the letter of Octo er. fully ber 1981 did not constitute a inte b. expenses Reimbursement of travel grated contract that at the meetings and other relat- 27, 1981, Pingitore on Pingi with meetings ed for trade interviews. Total orally agreed “Option tore One” which reimbursement shall not exceed 15% 13,1981 set forth in the licens industry study cost or a maximum ex- ing proposal. By argument, Chapek $2,625. pense of claims that commission term of your After review the attached re- “Option part One” became of its contract outline, suggest you search I relate to Hershey. Chapek any additions or deletions Her- responds shey may wish. can then discuss the Tony” 1981 “Dear complete letter is a same over the telephone. integrated fully document which cannot be might I suggest also that we mеet in by parol varied evidence. Because that Doyle again New York at during Dane any provision does not letter include for a the week of November 16th to finalize commission, Hershey argues the research outline. any cannot be bound to commission ar- you again Thank opportunity for the to rangement. 30, The October 1981 letter be to Hershey. service reads full as follows: (cid:127)Sincerely, Tony: Dear Ralph Chapek meeting Per our City in New York President 27th, concerning Chapek October 68-69, App. at 342. Our review of an order ducting industry study dairy for the granting summary judgment such as the category, this letter will serve as an case, district court’s order in plena- is agreement Ralph Chapek, between Inc. ry. Co., Goodman v. Mead Johnson & 534 (hereafter Chapek) and Hershey Foods (3d Cir.1976). F.2d (hereafter Corporation Hеrshey). The agreement details of the are as follows: A. provide will to comprehensive study of the indus- Hershey argues matter, as a threshold try general and the chocolate milk parol prevents that ‍‌​‌‌‌‌‌‌‌‌‌‌‌‌​‌‌‌‌​​‌​‌‌​‌​‌​‌​​‌‌‌‌‌​‌‌‌​​​‌‌‌‍the evidence rule specifically Hershey to evalu- pek attempting vary from to the terms of possible Hershey entry ate a in the choc- seeking letter milk category. olate prior, introduce evidence of a timing 2. The will be based ment, vary which evidence would the terms outline,

on the attached research with Chapek’s compensation. Chapek, how- reasonable modification and additions ever, asserts the oral Hershey. reached at the October is Chapek agrees confidentiality vary any not offered to or contradict research, findings all and recоmmenda- terms of the October 30th but rather concerning tions supplement research work conduct- is sup- offered to In its terms. by Chapek ed Hershey. port position, Chapek of that refers us to argue 3. The district court held that law not otherwise. applies appeal, Chapek to this case. On does the terms of written 162 to alter Dydek, 192 Potoczny v. adding states: still another term A.2d 70 allegedly agreed upon pri- compensation an oral It is well settled by a superceded parties’ is not invalidated 30th written or to or. contemporaneous inte- subsequent or agreement. See discussion infra agreement is not in- gration, if the oral Moreover, parol rule under evidence contract, integrated with the consistent par provides that when Pennsylvania law might agreement as be and is such an agree their a contract have reduced ties to parties separately by the naturally made writing writing, that will be ment to to the writ- situated were their sole evidence of omitted) (Citations ten contract. vary may evidence not be admitted However, Potoczny, Chapek’s reliance on the absence of terms of contract in Potoczny, A B misplaced. supra, “ fraud, par ‘Where accident mistake. C; purchase land from orally had ties, mistake, have without fraud or and B to eventually A own one-third deliberately put engagements in writ their eventually property. two-thirds own writing ing, law declares the deed orally agreed It would best, only, only the but the evidence A B initially in B’s name and that nego agreement____ preliminary their All land subsequently divide the tiations, agree and verbal conversations receiving After propоrtions mentioned. name, by the parcel merged superseded in his are in and for the entire ments the deed contract____’” convey B one-third to After refused to subsequent Scott brought suit, court ruled that B held Mawr, Pa. 312 A.2d Bryn resulting property in a one-third of the (1973)(quoting Gianni v. R. Russell & A, paid portion trust for who (1924) Co., (cita 126 A. 791 discussing purchase price. the issue omitted)). tions parol evidence, the court found as to raised purpose “preserve is to rule writing B “... was not between and C re integrity agreements by of written to, properly, and did not state the intended contracting parties fusing permit full Conse- B]. [A con attempt import the their alter parol quently, permissible it was to receive through contemporaneous use of tract the testimony____” Potoczny, 192 Fair oral declarations.” Rose v. Food Indeed, 558, at 162 A.2d at neither 120-21, Inc., 117, Stores, 262 A.2d 437 Pa. sought vary nor B the terms of the deed 851, (1970); Crоmpton-Rich given by by parol to B concern- 853 see C evidence also ing the Co., Smith, the one-third/two-thirds division of v. 253 mond Inc.—Factors property. (E.D.Pa.1966), aff'd, F.2d F.Supp. 980 392 (3d Cir.1967).4 The evidence rule 577 Thus, agree- Potoczny, supra, the oral writing represents if the entire applies the B) (between ment A and was found to be agreement parties. between the agreement might type the natu- “... separately by parties made situ- rally be agree Both parties the to the written ated as were 30, letter writ that the October 1981 was 558,162 agreement.” A.2d That Id. at by Chapek, by Hershey, and ten received significantly situation is different from the by upon in its terms here seeks acted accordance with situation found where Co., Crompton-Richmond 4. In Inc.—Factors v. tions were agree- not referred to in the written Smith, (E.D.Pa.1966), F.Supp. aff'd, 253 980 392 comparing agreements, mеnt. In the two the (3d Cir.1967), sought court agreements F.2d 577 the defendant determined that oral the and written matter, subject vary guarantee related to by the terms the same of a written claim- i.e., guarantee the pay defendant’s on a debt. ing agreement required that an oral certain The court further determined that there was a guarantee to be before ditions met his obli- likelihood that the oral conditions would have gation could be enforced. claimed the He agreement. been included the There- plaintiffs guarantee agreed orally that the had fore, the court excluded evidence of the oral year, was not to one become effective for conditions. only plaintiffs then if the certain' necessary backing. financial These oral condi-

995 parties.5 Our task is to determine be bоth both would executed the same that letter is the final and com- contract, whether time and the same the parties’ agreement. plete expression the subsidiary the agreement must is matter of law to be This determination be taken covered by writing. by jury. the court rather than a decided question This must be by determined Express, 523 Seidman v. American court. 1107, (E.D.Pa.1981); F.Supp. 1109 Walker 323-24, 281 Pa. at 126 (emphasis A. 791 Saricks, A.2d 11 360 Pa. added). (1949). present case, dispute we must F.Supp. Crompton-Richmond, requires resolve compare that we (3d (E.D.Pa.1966), aff'd, 392 F.2d Cir. which was said and to—if it was— 1977), in which detailed manner meeting the October explaining: to made by determination is Pingitore, with the letter That determination must be made ex- agreement of October 1981. As the amining writing comparing it refined, issue has appears been agreement. alleged with the oral If the difference between version agreement writing and the oral relate to parties’ subject if same matter and the court version Hershey agreed centers whether concludes that the situated as pay Chapek commission on choc- contracting parties, were the would nor- milk royalties olate period of five mally agree- have included both in one years. ment, then subject alleged conclude, If magistrate we as the and the having must be considered as concluded, district court that the October been writing. covered 30th subjects letter and the discussed at 1981 meeting relate to the Co., R. Gianni v. Russell & 281 Pa. subject same matter and normally Su- have been included in one be- preme Crompton, Court case cited in su- they cause are so interrelated that both pra, building the lessee of an candy office “agreements” would have been executed at argued stand that he had made an oral time, then, the same as the court in Gian- right for the exclusive to sell ni, 791, instructs, 281 Pa. at 126 A. soda water. The court found that the writ- case, “the subsidiary [in agreement of ten —which subjects discussed at the October 27th goods, mitted him to sell various did meeting] must be taken to be covered not mention an exclusive writing [here, 30th sell soda water—barred consideration of situation, In that all evidence re- ment].” doing, the oral In so it ex- lating to the October 27th analysis plained the to be used: inadmissible in evidence. agreement When does the oral come within the field the embraced B. by compar- one? This can be answered turn, therefore, comparison to a ing two, determining the and whether 27,1981 agreement of the October and parties situаted as were the ones to the agreement letter of October 1981. contract, naturally normally would and include the one in if agreement the other it were The October 27th oral is al- subject leged by made. they relate to the same to have been based on If “Option matter and are so interrelated of One” li- contract, 553, may Correspondence cording dairy a constitute to its terms. received a see, e.g., Keyser Margolis, v. 422 Pa. industry study and chocolate milk and (1966); necessary A.2d 13 parties and it is not for both compensated Chapek according to of the terms sign writing parties, acting if the 1981 letter after had terms, pursuant acceptance. to its evidence their a bill for submitted those services. Here, parties performed both ac- parties focusing on proposal three both the market- censing This has proposal.6 ing milk —the provide of chocolate sub- first would components. The letter, ‍‌​‌‌‌‌‌‌‌‌‌‌‌‌​‌‌‌‌​​‌​‌‌​‌​‌​‌​​‌‌‌‌‌​‌‌‌​​​‌‌‌‍ject 13th the conceded the first over commission 15% subject meeting, the October 27th and received years royalties five subject express of the October 30th The sec- licensing and ice cream. for milk marketing provides a number of ond studies, stipulated with a each research interrelationship of the of the Because provides reimburse- price. The third marketing of chocolate milk and the com- expenses. Chapek’s travel ment of arrangement by Chapek— mission asserted arrangement predicated upon royalties an 30th letter The October for the received com- Hershey claims evidences the be no chocolate brand —there can dоubt of the references plete agreement that the crux October 27th meeting, preamble the October 27th in its 30th letter the crux October are agree- that it to serve as and states interrelated, normally find would ex- Hershey. between ment writing. pression in one agreement are then set details of that forth, essentially they consist of the persuaded by Chapek’s argu- We are not following: letter ment the October 30th was noth- (1) Chapek provide a confidential would ing partial integration, more than study research firming “certain details of a broader con-

industry specifically of the chocolate sulting arrangement pursuant to which milk market. Hershey agreed pay Chapek com- (2) Hershey compensate Chapek royalties on mission and fees earned from $17,500 (the study Hershey’s entry sum into for this the chоcolate milk Option specified Appellant’s same One for a market.” Brief at As sum can seen, industry milk ice cream letter does not chocolate October 30th study) stages. greater respect so any and would do in two furnish detail with study also would reimburse chocolate milk than does the Au- Moreover, gust proposal. 13th expenses for travel same rate as as we have One, observed, provided Option purports but with a the October 30th letter ceiling meeting, expenses. to memorialize that and states that it is serve as an “agreements” two comparison of the parties. Significantly, neither the Octo- obviously they reveals that relate to the any ber nor Indeed, very subject same matter. succeeding agreements provide spe- study “Option mentioned One” compensation terms of cific the services performed was performed by Chapek, to be refer to 30th incidental agree- commission or master study modifications. ice cream was specific ment which would override the deleted from the October 30th compensation to which the though “Option even One” included both an agreed.7 ice as well as a chocolate milk cream support study. payment The manner and time of To its view the letter spelled partial integration, out in the October 30th October 30th is ment, analogizes completion pek as was the date of the this case to Piccari Var- daro, question project. There can be little 171 A.2d 807 "Option provision appears supra, anywhere text note the One.” such licensing proposal, in Inexplicably, Chapek reading contends that its condition, 30, 1981 letter. Nor does this what- "Option providеs that One" the 15% commis- meaning, appear been a ever ever have entitled, sion to which believes it is agreement subject of the paid out" would be if and when "national roll Chapek, does it was ever nor the record disclose Appellant’s was achieved. Brief at 26. "Nation- achieved. term, appears to al roll-out" and no Piccari, (1961). agreement plaintiff sought an oral a one-third share of the profits which a com- brokerage business; homé construction contained of a wine he in provision by alleged mission was succeeded time part employment of his agreement purchase a second written contract representative, as a sales it had lumber, did a not include commission been orally agreed that he would become a subjects of oral provision. The partner. one-third document set- (supervision preparation plans tract ting plaintiffs forth the terms of the em- home) separate for a from the sub- were ployment awas written memorandum sent (labor subsidiary agreement jects of the by the by defendant and plain- initialed project). materials for construction memorandum, tiff. The drawn to confirm The later written contracts contained none parties’ agreement, earlier outlined the agree- by called for the oral services plaintiff’s employment— material terms of ment, and indeed made no mention of the duties, specifically, his salary expense supervision agreement. The court refused account. not It did discuss a partnership integration in complete to find the later plaintiff. interest agreement. Supreme permit Cоurt refused to oral testi- mony partnership interest because it Piccari, however, precedent is not vary or contradict terms being the circumstances considered here.8 Instead, confirmatory memo. the court in Piccari, suggestion Unlike there is no directing summary judgment for the de- prior, larger present case that fendant held that the written memo was a (the alleged project agreement oral of Oc- complete integrated written contract. 27th) totally separate tober oral was agreement could on its stand own as plaintiff Just as the in Keyser could not agreement. Here, integrated an vary the compensation terms his by a argues only prior agree- “oral prior oral is Chapek’s so too supplement ment” was meant to the later compensation in this case restricted to the agreements, written and that the “oral terms of agree- the October 30th written agreement” provided compensa- a term Hershey. Giving Chapek, ment with tion which was not included in the written non-movant, inferences, the benefit of all agreement already itself. But as have we must, as we we help nevertheless cannot noted, the October 30th written letter agree magistrate’s conclusion price comprehensive contained a that: provisions term of as well as time unlikely potential It is most re- As payment. for its its brief cipient potentially large of a sum under a out, succinctly plaintiff points “... The contractual would memori- prove contract; Piccari oral sought to alize in a written the terms of clearly specified seeks alter a relatively subpart small of that аgreement.” Appellee’s term of a written ment and omit to the more memorialize (emphasis original). Brief 19-20 significant subpart(s). Defendant has Margolis, v. Keyser

We find case of explanation rational for a Moreover, A.2d party 422 Pa. be closer so. do subse- Keyser, quent of this case. of contracting facts course between the trucking upon company. 8. The other authorities relied owned a issue before One Milling inapposite. are also Co. International the court whether of the non- the terms Hachmeister, (1955) competition agreement 110 A.2d 186 the sales were varied allegations misrepresen- involved agreement. Pennsylva- fraudulent applying This court in omitting quality law, tation the seller term nia its decision construe the two rested allegation from a written No such agreements together upon the evidence of fraud is in the case us. made before they contained within both documents that single writing together, Pitterich, "no be read and that Refrigerated In Krobtin XPress v. agreement." (3d whole of Cir.1986), embodied the F.2d brought an action was 107-108 Thus, not involve the Id. at 108. problem Krobtin did on two written contracts —a noncom- prior petition agreement which is of a and a sales —re- company purchase holding lated to the of a that before us. 998 marketing licensing scheme and the stud- involving specif- of the reduction perform not matter Chapek subject the same agreements for ies were

ic specific it considered these when is that specific services fails consideration, proposals together concepts with written were first articulated 13, August inconsistent in acceptances, by Chapek is with its unsolicited written existed a master proposal. that there the notion 1981 binding Hershey to far 359-60. liability to greater potential contractual satisfied, despite are various largely Chapek undefined services. arguments by Chapek,9 made the Octo that report, magistrate’s App. at 358. 30, same ber 1981 letter relates to the by adopted district court and which subject matter as the October 27th discus agree, additionally points which we complete integrat sions and constitutes the that: out agreement Hershey Chapek ed of as of 30, 1981 Chapek drafted that date. pur- This agreement. written the oral portedly covered III. 27, exact made on October perform Chapek services that argues that Chapek also the district large potentially consideration of 15% by granting summary judg- court errеd royalties fees claim ment on the meruit any prior writing, clearly out in spelled Chapek claims favor of because 13, 1981 including the written genuine remain as issues of material fact licensing scheme can not proposal. The performed uncompensated services subject conceptualized as a different Chapek. If, marketing matter studies. than contends, undertaking Chapek it was it specific marketing studies under- Quantum quasi-con is meruit specific amounts considera- took for im remedy tractual in which contract recognition poten- of its tion at a loss plied-in-law theory unjust en licensing under a profit tial when the scheme richment; is im the contract is one that reality, scheme was came to law, plied and “not an actual contract at certainly subject the same matter Chа- Benson, Mart Ragnar all.” Inc. Bethel pek’s as the studies. view 414, Associates, Pa.Super. 405, 454 308 This one matter was the matter that 599, (1982). Lakes brought Hershey together, A.2d 603 Birchwood Chapek Comis, Association, upon Community Inc. v. only subject matter and was the 304, 308 A.2d The idea that the they had dealt. correspondence all on which Chapek suggests Her- As with other conduct certain relies, by Ralph shey subsequent 30th letter dem- Chapek was written this letter the letter did not constitute accepting Chapek’s onstrates that Chapek Even himself. integrated agreement; Chapek parties’ "re- claims, occurring years events two after understanding it peatedly asserted" parties’ alter cannot pursuant "Option compensated would be original Dunn v. their contract. See terms of licensing proposal; One" 499-501, Orloff, 318- A.2d performed Chaрek services at Her- and that (1966) (testimony sub- of witnesses events shey’s it never have which would behest judgment ad- sequent note not to execution particu- a master formed but for note; vary case ”[n]o missible to terms lar, to a our attention December calls permit gone has so far as to ever wrote, in which to be altered the terms of written contract [Pingitore] proposed op- three he states “You subsequent testimony [of varied such compensate in lieu tions when, events].”). isas particularly true This is accepted you previ- base of the 15% commission here, for no reason those events are offered true ously App. relies on this ...” prove existence of inadmissi- other than argue during 1983 letter to December evidence, case the existence in this ble negotiations, indicated that сertain 15% commission. owed commission. Pennsylvania Superior Court ex- research into dairy industry,” compiling plained that: analyzing range and a broad of “data re- garding products chocolate milk pro- and contract, quasi also referred to as a ducers,” providing “extensive, and ongoing implied imposes duty, contract in law consulting business for Hershey services any agreement, not as a result of wheth- products the new Appellant’s field.” Brief express implied, spite but in

er or Chapek also “brought that it states party of an when absence one Hershey the detailed and distinctive licens- unjust an enrichment at the ex- receives itself,” ing concept saved “the Westing- v. Schott ‍‌​‌‌‌‌‌‌‌‌‌‌‌‌​‌‌‌‌​​‌​‌‌​‌​‌​‌​​‌‌‌‌‌​‌‌‌​​​‌‌‌‍penses of another. expense time and it would Corp., have had to house Electric research, incur develoр Thomas v. (1969); Reyn- R.J. A.2d 443 introduce Hershey brand chocolate milk.” Id. Co., olds Tobacco 350 Pa. 38 A.2d 61 Chapek also asserts that it Storage (1944); “would not have Central & Co. Transfer assignments the three Kaplan, 37 Pa.Commonwealth v. Ct. ^conduct [i.e., dairy industry alone (1978). study, the “50 389 A.2d 711 study, Metro” market and the in-depth brought theory An action on a analysis], merely for the fees Her- quantum restitution, meruit sounds in shey paid, without more.” Corp. Development Overseas Disc. v. San itself, however, Inc., refers Co., gamo Constr. 686 F.2d 510- specific two Chapek per- instances in which (7th Cir.1982), sustain a claim of formed services for enrichment, unjust the claimant must show connection the chocolate milk project, party against recovery whom compensation. which it received no Ap- sought wrongfully pas either secured or pellant’s Brief at 26. These instances con- sively received a benefit that would un be performed cern the work by Chapek in party conscionable for the to retain without projects relation to involving Nestle’s Cor- compensating provider. Torchia on poration However, Dairy. Knudsen’s Torchia, 346Pa.Super. Torchia v. behalf of any quantum meruit award due to Cha- (1985). 499 A.2d 581 pek for those services has been removed law, quasi- Under “the subject from See note appeal. of this unjust contractual doctrine of enrichment 2, supra. inapplicable relationship when the be [is] agree with the district court tween the is founded on a written remaining per that all of the services express contract.” Benefit by Chapek scope formed fall within the Bank, Trust Ins. v.Co. Union Nat. Life separate agreements those individual and (3d Cir.1985) (quoting Schott 776 F.2d 1174 into which еntered Westinghouse, supra). v. Where an ex and for which admittedly com press governs relationship contract pensated. observed, As we earlier have parties, party’s recovery is limited to express governs where an provided express the measure in the con relationship recovery tract; and where the contract “fixes the is limited to the measure involved,” value services there can Quantum contract. meruit will not quantum meruit recovery no under a express agree awarded when there is an Burke, Murphy Haws theory. & Burke, Murphy v. Haws & ment. 484, 489, (1975) 344 A.2d supra. (where implicit contract existed between firm, separate quan attorney and law no Our review of the record discloses that tum meruit obtained). recovery could be exception with the of Nestle’s and Knud- claims, quantum sen’s none of

B. meruit allegаtions relate to services that claim, In support meruit of its are not included within the generally separate agreements refers to work it entered into Hershey, namely Thus, formed for pek Hershey. “nationwide makes a BECKER, Judge, dissenting. meruit quantum “compiled Circuit claim that it milk, despite the regarding chocolate data” following events the I believe that Octo- contemplated in that this service was fact particular, and in cer- ber 30th, the of October which by clearly tain statements demon- industry of cerned a the strate that the October 30 letter was not industry chocolate milk general fully integrated intended to constitute the pursuant to Her- specifically which —and of rather $17,500. Chapek shey paid part memorialized a of their I ongoing it Chapek’s claim that would therefore admit evidence and рroducts Hershey in the new for services permit Chapek prove liability Hershey’s to field, very services which is based on “Option to it under One.” according to the performed baked Chapek pursuant to goods agreement, sweet primary for basis this conclusion is Chapek $20,125. Ap- which, paid Hershey that, Pingitore Chapek met in when Chapek’s claim that pellant’s Brief at 27. Chapek's request 1983 to discuss December Hershey concept to it contributed Hershey begin making the commission that Hershey brand name dair- One, Pingi- payments Option called for in very subject covered ies on the is based compensation options tore offered several dairy industry milk in- and chocolate in lieu commission. (Appendix dustry agreement, the “50 Metro” seq.).1 et my view, at 279 this offer ment, “in-depth analysis” Hershey’s understanding evidences ‍‌​‌‌‌‌‌‌‌‌‌‌‌‌​‌‌‌‌​​‌​‌‌​‌​‌​‌​​‌‌‌‌‌​‌‌‌​​​‌‌‌‍that it Hershey paid Chapek agreement, for which ongoing consulting entered into $23,825, respectively. $17,500, pursuant Option Chapek Chapek Nor has documented benefit One, Chapek and that more than owed Hershey unjustly as re- obtained which payments Option set forth in the fixed-sum proposals made sult of the unsolicited One. Chapek projects Hershey reject- for which supra, p. ed. See Therefore summa- 992. Second, undisputed the evidence is Hershey on ry judgment in favor of performed Hershey’s Chapek services at meruit appropriate. claim is behest, including investigation the Nestle pointed out in its As has Dairy and the of the Knudsen brief, “good Chapek struck a whether meeting, Chapek paid. was not deal,” genuine is issue of fact which Hershey requested That summary judg preclude entry can form outside the of the three services gov express if an written contract ment specific assignments Option set under forth 42. Appellant’s erns. Brief at Since provides One evidence of the existence received all record shows consulting agreement. It seems broader its compensation that due under writ to me that have doubtful and the ten of October performed gratuitously; these services subsequent agreements into Her it seems more reasonable to believe rather entered, argue cannot shey on-going part it did so as of an consult- more than it received. worth services were Option em- ing engagement, such as One bodies.

IV. Additionally, specifically referred the Order of the district will affirm Option summary One “Introduc- re- September all court dated assignment performed tion” to the second spects. 283, 284, Ralph (deposition testimony of question argument arose at oral as wheth- Hershey's Pingi- Anthony Chapek relating tore, er there was admissible evidence statements However, reproduced depositions Products). declarations. Director of New supplemen- post-argument submission of depositions district court were before the These appendix make it clear that there tal materials summary in connection with the motion Post-Argument problem. Submis- no such judgment. Materials, Supplemental Appendix sion of dence, study. genuine Con- is a “50-Metro” there issue of material —the paragraph set first spicuously out fact as to whether in fact Pingitore report and read aloud to Mr. Option One. following was the statement: I intimate no view as the likelihood of project chocolate milk prоving success in what seems to began concept with the submission of be, Chapek, gener an extraordinarily Inc., Chapek, proposal Ralph Her- hand, arrangement. ous On the other Cha August, shey Foods pek appears to be a “whiz” and accepted Chapek’s Option in One listed it seems have been that awoke Proposal industry on the and work of the colossus chocolate world to the study Option listed One was initiated possibilities marketing prod fresh milk December, 1981. magic ucts under name. I let a 106; supplied.) (Appendix emphasis jury decide what the was. I subsequent Option .3 This reference One in respectfully dissent the second undertaken accepted by Hershey arguable deny,

did not is an admission pursu- parties proceeded Option One, estopping Hershey from

ant to

denying the existence of thе “Commission agreement.2 Based” UNITED OF STEELWORKERS Moreover, me- in terms of the AMERICA, AFL-CIO, claim, ruit offer alter- Hershey’s to discuss Appellant, to the natives commission constitutes an admission and demonstrates

recognition fact had in COMPANY, NEW li- JERSEY ZINC INC. formed extensive research and censed to do business State compen- services for which it had not been Jersey New and as Administrator Pingitore’s thus in- sated. words and acts Jersey Plan of Pension the New Zinc understanding dicate his both own Company. effort, Chapek’s nature extent of No. 86-5756. of those services. value foregoing, view the I believe that Appeals, United States Court accepted Option evidence that One Third Circuit. Licensing Proposal is not offered to Argued May 1987. “vary or contradict” Sept. Decided 1987. the ex- but rather establish consulting agreement istence aof broader As Amendеd Oct. 1987. I Chapek. believe question that the evidence raises a serious

whether the October 30th letter constituted integrated agreement. IAnd believe

that, considering all the evi- admissible Thereafter, properly proposal in a sent to tion was not intended to did not cerning understanding goods Chapek parties.” baked sweet reiterated its state the entire between the proceeding (emphasis origi- Id. at 218 A.2d at 316 pursuant Option One. nal). rejected proffered In Dunn the court en- admissions because the evidence consisted tirely Orloff, I find of Dunn v. do not the case witnesses’ statements. interested 492, 499-501, 218 A.2d 318-19 contrast, record the district court before ‍‌​‌‌‌‌‌‌‌‌‌‌‌‌​‌‌‌‌​​‌​‌‌​‌​‌​‌​​‌‌‌‌‌​‌‌‌​​​‌‌‌‍majority op. majority, relied on here included far more extensive evidence recognized apposite. n. The Dunn court by Hershey admissions explain "parol evidence is admissible integrated. supplement such where writing ques- clearly evidence shows that the

Case Details

Case Name: Hershey Foods Corporation v. Ralph Chapek, Inc.

Court Name: Court of Appeals for the Third Circuit

Date Published: Sep 11, 1987

Citation: 828 F.2d 989

Docket Number: 86-5726

Court Abbreviation: 3rd Cir.