OPINION AND ORDER
This matter is before the court on motions by defendants Total Petroleum Puerto Rico Corporation (“Total”) and Esso Standard Oil (Puerto Rico), Inc. (“Esso”). *204 On April 29, 2009, Total filed a motion to preclude further participation of plaintiffs in cases 08-1950, 08-1986, and 08-2025. (Docket No. 247.) On May 8, 2009, Esso moved for an entry of final judgment in its favor as to all claims in cases 08-1950, OS-1986, 08-2025, 08-2032, and 08-2044. (Docket No. 248.) Plaintiffs from cases 08-1950, 08-1986, and 08-2025 (“Group I plaintiffs”) filed their opposition to the motions filed by Esso and Total on May 11, 2009. (Docket No. 249.) On May 18, 2009, those plaintiffs filed an informative memorandum in further support of their opposition. (Docket No. 252.) Plaintiffs from case 08-2044 and 08-2032 (“Group II plaintiffs”) filed oppositions to the entry of final judgment on May 21, 2009 and May 23, 2009, respectively. (Docket Nos. 256, 260.) On June 3, 2009, Total filed a reply 1 to plaintiffs’ opposition to the entry of final judgment, and moved to strike plaintiffs’ informative motion in further support of their existing opposition motion. (Docket Nos. 267, 268.) For the reasons set forth below, Total’s motion is GRANTED and Esso’s motion is GRANTED in part and DENIED in part.
I. PROCEDURAL AND FACTUAL BACKGROUND
The facts of this case have been recounted multiple times.
See Santiago-Sepulveda v. Esso Standard Oil Co. (P.R.),
On October 7, 2008, I issued an order acknowledging an agreement between the Group II plaintiffs and the defendants, and retaining supervision and jurisdiction over the parties until final resolution of the matter. (Docket No. 81.) On October 18, 2008, I issued an opinion and order denying plaintiffs’ motion for preliminary injunction. (Docket No. 118.) On October 29, 2008, plaintiffs in case 08-1986 announced that they had agreed to accept the franchise agreements offered by Total. (Docket No. 146.) Between that date and October 31, 2008, all but two plaintiffs signed agreements with Total. (Docket No. 157, at 5, ¶ 2.)
In the time since that date, the parties appear to have been adhering to their *205 mutual obligations under the contract. Esso and Total now contend that this court has already deemed them compliant with the PMPA. Thus, Esso argues for entry of final judgment and Total moves for “an order precluding [Group I plaintiffs] to [sic] appear in any further proceedings. ...” (Docket No. 247, at 7.) Plaintiffs, however, argue that the court has decided only that a permanent injunction will not issue against Total and Esso. (Docket No. 249, at 2.) They contend that they are still entitled to a ruling on the legality of the franchise contracts, which Total offered to them on a “take it or leave it” basis. (Docket No. 155, at 3.) In plaintiffs’ view, final judgment may not be entered before such a ruling.
The franchise agreement offered to plaintiffs by Total consists of three separate contracts: a Lease Contract, a Franchise Contract for Total’s convenience store enterprise known as “Bonjour,” and a Sale and Supply Contract. (Docket Nos. 155, at 3, 155-4.) Plaintiffs have argued that the following provisions of those contracts are illegal and should not be imposed upon them:
Paragraph 2 of Article 4.1 of the Lease Contract:
The Retailer [plaintiffs] expressly acknowledges that the Company shall be entitled to lease to third parties parts or portions of the lands or structures where the Station is located, and that the Retailer shall have no right to discounts or credits of any kind as a consequence of the above.
(Docket No. 108-3, at 3.)
Article 4.4 of the Lease Contract:
[T]he parties agree that the Minimum Rent may be increased to account for any additional investment the Company [Total] may make ... at any time while this Contract is in effect ... at its sole and absolute discretion.
(Docket No. 108-3, at 4.)
Article 11.2 of the “Bonjour” Franchise Contract:
The Retailer agrees to purchase for sale at the store only those Products and Services of the type, brand and quality recommended and/or approved by the Company.... The Retailer agrees to purchase only from those suppliers and providers authorized by the Company.... The retailer must refrain from selling any product or service that is not authorized by the Company....
(Docket No. 155-4, at 15.)
Article 9.3 of the “Bonjour” Franchise Contract-N on-Competition Agreement:
The Retailer agrees, for the duration of the Contract, and for an additional period of twelve (12) months after its termination or expiration, not to engage in or acquire any interest, directly or indirectly, in a convenience store type of business within the territorial jurisdiction of the municipality where the BONJOUR Franchise object of this agreement is located, or any adjoining municipality. The Retailer will be deemed to be engaged in such business indirectly if he is an employee, officer, director, trustee, agent or partner of a person, firm, corporation, association, partnership, trust, or any other legal entity that is engaged in such a business within the aforementioned area. The above shall not be understood as a prohibition from having any interest in a corporation or entity for investment purposes without intending to acquire control or majority interest in securities traded in a recognized stock market.
(Docket No. 155-4, at 11.)
Article 8.1 of the Sale and Supply Contract-Discontinuation, Substitution of Products:
*206 The Company shall have the absolute right to discontinue or subtitute [sic] any engine fuel, petroleum product or any of the Total Products object of this Contract for industrial reasons, inventory reasons, world-wide supply of materials, or for marketing or competition decisions, and the retailer agrees to acquire the substitute products as long as the Company sells them within the Territory instead of the substituted product.
(Docket No. 155-5, at 8.)
Each of the three contracts also contains language relating to the interpretation of the contracts themselves:
This Contract shall be interpreted consistent with and governed by the laws of the Commonwealth of Puerto Rico.
(Lease Agreement, Article 19.1, Docket No. 108-3, at 21; Franchise Contract, Article 17.1, Docket No. 155-4, at 24; Sale and Supply Contract, Article 23.1, Docket No. 155-5, at 23.) All three contracts also provide for the severability of contract terms under certain circumstances:
The intention of the parties appearing herein is for all provisions on this Contract to be complied with in their entirety as allowed by law. Therefore, should a court with jurisdiction find that the scope of some of the provisions is too broad to be complied with as written, the intention of the parties is that the court must modify such provision until its scope is one that the court finds may be enforceable. However, should any provision in this Contract be found to be unlawful, invalid, or unenforceable under present or future laws, said provisions shall be nullified; this Contract shall be interpreted and governed as if said unlawful, invalid or unenforceable provision had never been a part thereof, and the rest of the provisions in this Contract shall remain in force and will not be affected by the unlawful, invalid or unenforceable provision or its elimination.
(Lease Agreement, Article 20.10, Docket No. 108-3, at 23; Franchise Contract, Article 18.3, Docket No. 155-4, at 25; Sale and Supply Contract, Article 24.3, Docket No. 155-5, at 24.)
II. DISCUSSION
A. Prior Rulings
The first issue is the extent to which I may order relief to plaintiffs in light of prior rulings in this case. Total suggests that final judgment has already been issued in this case. (Docket No. 268, at 4, ¶ 15.) It has not. Nowhere in any opinion or order issued by the court in this case has there appeared an order for entry of judgment. Nor has any judgment been entered into the civil docket under Rule 79(a). Fed.R.Civ.P. 58(c)(l)-(2) (judgment is only entered when “the judgment is entered in the civil docket under Rule 79(a).”). Indeed, if judgment had already issued, Esso would not be moving for entry of final judgment. (Docket No. 248.)
See Total Petroleum P.R. Corp. v. TorresCaraballo,
Both parties suggest that judgment is appropriate because the decisions already made by the court leave nothing left to rule upon. It is true that I held in the opinion and order issued on October 18, 2008 that “Esso has complied with the notice requirements under the PMPA, and Total’s offering of nondiscriminatory franchise contracts generally complies with Esso’s obligation to assure that its franchisee is offered a non-discriminatory contract. ...”
Santiago-Sepulveda v. Esso Standard Oil Co. (P.R.),
Even if I had made a finding on the legality of certain contract terms, this would not constrain my power to modify such a finding. Federal Rule of Civil Procedure 54(b) provides that “any order or other decision, however designated, that adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties ... may be revised at any time before the entry of a judgment adjudicating all the claims....” Fed.R.Civ.P: 54(b). Moreover, “the law. of the case doctrine does not prevent a judge from changing his mind, so long as there was an explanation and the court took into account justified reliance.”
City of Bangor v. Citizens Commc’ns Co.,
B. Section 2805(f) of the PMPA
The next issue is whether the PMPA provides a basis for relief if any of Total’s terms are found illegal. Section 2805(f) of the PMPA provides:
No franchisor shall require, as a condition of entering into or renewing the franchise relationship, a franchisee to release or waive ... any right that the franchisee may have under any valid and applicable State law.
15 U.S.C. § 2805(f)(1)(B). There is some question as to whether section 2805(f) provides an independent remedy under the PMPA, especially where, as here, the franchisee has already accepted the franchisor’s offer. The First Circuit has yet to interpret section 2805(f) explicitly, but it has found that the Act “requires that franchisees faced with objectionable contract terms refrain from ratifying those terms by executing the contracts (even ‘under protest’) and operating under them” if they wish to be protected under the PMPA.
Marcoux v. Shell Oil Prods. Co. LLC,
[3] In this case, all but two plaintiffs ratified the terms of Total’s offer over seven months ago. There is therefore reason to question plaintiffs’ right to contest contractual terms at this stage in the litigation. This case, however, differs materially form
Marcoux
and
Dersch.
Whereas “[t]he stumbling block” for plaintiffs in
Marcoux
and
Dersch
was that they did not “insist on receiving notices of [franchise] nonrenewal,”
Marcoux v. Shell Oil Prod. Co. LLC,
C. Legality of Terms
1. Leases to Third Parties
Article 4.1 of the Lease Agreement permits Total to lease portions of the leased premises to third parties, and provides that plaintiffs “shall have no right'to discount or credits of any kind as a consequence....” (Docket No. 108-3, at 3.) “Under Puerto Rico law, three elements characterize a lease contract: (1) the thing; (2) temporal duration; and (3) a price.”
Pico Vidal v. Ruiz Alvarado,
Article 4.1 borders on the unconscionable. Under the Article’s terms, Total would have the right to lease 99% of a given gasoline retail station to a third party while still charging the franchisee 100% of the rent expense. WTiile Puerto Rico law does not require that the “leased thing” be entirely defined, it must still be at least identifiable. Article 4.1 simply leaves too much room for arbitrary or discriminatory actions by Total.
See Avramidis v. Atl. Richfield Co.,
Moreover, Article 4.1 defies the spirit, if not the letter of Puerto Rico’s Department of Consumer Affairs Rental Regulation Number 2823, Section 6, Article 10, 2 which limits the rent charged in connection with a lease of a gasoline station to 10% of the market value of the station to be rented. If “the station to be rented” includes only *209 that portion of the premises occupied the franchisee, the fair market value of that “station” could become quite small if Total leases a significant portion of the premises to a third party. In that situation, the full rental price charged by Total may come to exceed 10% of the market value of the remaining area occupied by plaintiffs. This would contravene Regulation 2823. Accordingly, I find that Article 4.1 requires the franchisees to waive existing rights under state law and is therefore impermissible under section 2805(f) in its present form. Total is within its rights to lease portions of its station to third parties, but it may not insist that “the Retailer shall have no right to discounts or credits of any kind as a consequence” of such third party leases.
2. Additional Rent
Article 4.4 of the Lease Agreement provides that the rent “may be increased to account for any additional investment [Total] may make ... at its sole and absolute discretion.” (Docket No. 108-3, at 4.) In Puerto Rico, “[t]he rules for determination of price in purchase and sales agreements are applicable to leases.”
In re Daben Corp.,
3. Restrictions on Products and Services Purchased
Article 11.2 of the Franchise Contract provides that “[t]he Retailer agrees to purchase only from those suppliers and providers authorized by the Company....” (Docket No. 155-4, at 15.) Law No. 77 of June 25, 1964, created Puerto Rico’s Office of Monopolistic Affairs, and vested it with the power “[t]o promulgate ... such rules and regulations as may be necessary and proper for the enforcement of [the legislative Act on Monopolies and Restraint of Trade].” P.R. Laws Ann. tit. 10, § 272(5). The rules and regulations of the Office of Monopolistic Affairs “have the force of law” once approved. Id. Article 4(e) of Regulation I (Number 994) of the Office of Monopolistic Affairs was approved on August 19, 1965, in conformity with Law No. 77. It is still effective. 3 Article 4(e) provides that it is illegal, in a gasoline franchise relationship, “to compel or attempt to compel the retailers to sell products manufactured, distributed, endorsed, or in any way favored by the distributors.” 4 Total is thus proscribed from requiring plaintiffs to sell the products it endorses or favors. To the extent it does so, Article 11.2 of the Franchise Contract is illegal.
*210 4. Non-Compete Agreements
Article 9.3 of the Franchise Contract prohibits the retailer from engaging in “a convenience store type of business within the territorial jurisdiction of the municipality where the Bonjour Franchise object of [the] agreement is located, or any adjoining municipality” for “an additional period of twelve (12) months” after the contract’s expiration. (Docket No. 155-4, at 11.) Under Puerto Rico law, noncom-petition clauses are subject to four conditions.
Arthur Young & Co. v. Vega III,
5. Non-Branded Gasoline.
Article 8.1 of the Sale and Supply Contract reserves for Total the right to discontinue or substitute any engine fuel, petroleum product or any of the Total Products for other products under a variety of enumerated reasons. (Docket No. 155-5, at 8.) I have addressed the issue of unbranded gasoline at length in my most recent opinion and order at Docket No. 287. The ruling of that decision was based on plaintiffs’ request for an injunction against the use of allegedly unbranded gasoline; it did not address the legality of Article 8.1. The law and the reasoning I applied in that decision are nonetheless equally availing here, and I incorporate that opinion and order herein, mutatis mutandis. Under the PMPA, there is no requirement that Total provide only gasoline refined by Total itself. Accordingly, there is nothing illegal about Article 8.1.
D. Severability
Given that Articles 4.1 and 4.4 of the Lease Contract and Article 11.2 of the Franchise Contract all violate section 2805(f) of the PMPA to some extent, the next issue is what remedy to afford plaintiffs. I find that each of these clauses is severable to the extent they are declared invalid above. Each of the three contracts offered by Total contains an explicit severance or “savings clause.” “[S]hould any provision in [the] Contract be found to be unlawful, invalid, or unenforceable under present or future laws, said provisions shall be nullified,” and the contract should be treated as if the violative provision nev *211 er existed. (Docket No. 108-3, at 23, art. 20.10.) “[T]he rest of the provisions in [the] Contract shall remain in force.... ” (Id.) The First Circuit approves the use of a standard “savings clause:”
A “savings clause” preemptively resolves conflicts between contract language and applicable law in order to preserve the remaining, non-conflicting contract language. “Savings clause” is somewhat of a misnomer. The contractual language in conflict with applicable law is not saved. The non-conflicting language is saved. In the absence of a savings clause, the decision maker, be it an arbitrator or a court, decides the remedy for resolving a conflict between contract language and applicable law. That remedy, driven by an assessment of the intent of the parties, could be as small as severance of the offending contract language, or it could extend to outright non-enforcement of portions of the contract that include the offending contract language or the contract in its entirety. In essence, a savings clause serves as an expression of the intent of the parties that limits the remedies an arbitrator or court may use in situations of conflict between contract terms and applicable law.
Kristian v. Comcast Corp.,
III. SUMMARY
Esso and Total have complied with the PMPA. Total’s franchise agreements with the Group I plaintiffs are valid with the exception of the following provisions, which are hereby PROHIBITED from appearing in any contract between the parties:
• Those portions of Article 4.1 of the Lease Contract that permit Total to lease to third parties parts or portions of the lands or structures where the station is located without allowing plaintiffs the right to discounts or credits. (See Article 4.1 of the Lease Contract, Docket No. 108-3, at 3.)
• Those portions of Article 4.4 of the Lease Contract that permit Total to increase the minimum rent to account for any additional investment Total may make at its sole and absolute discretion. (See Article 4.4 of the Lease Contract, Docket No. 108-3, at 4.)
• Those portions of Article 11.2 of the Franchise contract that require the re *212 tailer to purchase only those products and services manufactured, distributed, endorsed, or an any way favored by Total. (See Article 11.2 of the Franchise Contract, Docket No. 155-4 at, 15.)
Finally, it is hereby ORDERED that partial, final, appealable judgment be entered in cases 08-1950, 08-1986, and 08-2025, pursuant to Rule 54(b) of the Federal Rules of Civil Procedure. Fed.R.Civ.P. 54(b). Such a judgment “as to fewer than all the claims [or parties] in a multi-claim action [is permissible] ‘upon an express determination that there is no just reason for delay.’ ”
Quinn v. City of Boston,
Here, cases 08-1950, 08-1986, and 08-2025 were filed to enjoin Esso from terminating its Puerto Rico gasoline retail stations. I have denied such an injunction, have concluded that Total and Esso are compliant with the PMPA, and have invoked the severance provisions of Total’s franchise contracts in three instances. As to those three cases, there is no just reason for delay because all issues of any substance have now been ruled upon. The public interest would best be served by the rapid resolution of any outstanding points of contention upon immediate appeal. I abstain from entering final judgement in cases 08-2032 and 08-2044 because the parties in those cases reached an agreement in October 2008, over which I am to retain supervision and jurisdiction. (Docket No. 81.)
IV. CONCLUSION
Total’s motion (Docket No. 247) is GRANTED. Esso’s motion (Docket No. 248) is GRANTED to the extent it requests final judgment as to cases 08-1950, 08-1986, and 08-2025; it is DENIED to the extent it requests final judgment as to cases 08-2032 and 08-2044. Total’s motion to strike plaintiffs’ informative memorandum (Docket No. 268) is DENIED.
There being no just reason for delay, the Clerk is ORDERED to enter partial final judgment as to cases 08-1950, 08-1986, and 08-2025 dismissing them in their entirety.
SO ORDERED.
Notes
.
Caveat.
Rule 7.1(e) of the Local Rules for the District Court of Puerto Rico provides that "[a]ll memoranda shall be ... in a font size ... no less than twelve (12) points.”
Local Rules of the U.S. District Court for the District of P.R.,
Rule 7.1(e) (2004). Counsel for Total violated this rule by submitting a reply in a nine (9) point font. Local Rule 7.1(e) is "unambiguously clear.”
Ortiz v. Hyatt Regency Cerromar Beach Hotel, Inc.,
. This regulation is listed as current on the Microjuris legal database. Microjuris database, microjuris.com (last visited Jun. 16, 2009).
. The regulation is listed on the website of the Puerto Rico Department of Justice, http:// www.justicia.gobierno.pr/rs_template/v2/Asu Mon/asumon_reg.html # 0994 (last visited Jun. 15, 2009). It is listed as current on the Microjuris legal database. Microjuris database, microjuris.com (last visited Jun. 15, 2009).
. The court's translation.
