See Darling’s v. Ford Motor Co., 719 A.2d 111, 116 (Me. 1998). Volvo, for its part,

has offered up various reasons for its actions that could, if proven to be true, show that
it did act in good faith with respect to FMS. If we were dealing with this case with a
clean slate, these issues would have been relevant, but the issue of Volvo’s good faith
is plainly not within the Seventh Circuit’s mandate, and we are therefore foreclosed

from considering it during this remand stage. See, e.g., Pearson v. Edgar, 153 F.3d

397, 405 (7th Cir. 1998).

The second basis that FMS puts forth is the flip side of Volvo’s motion for
summary judgment, focusing on Volvo’s position that it discontinued production ofthe
goods for which FMS had its franchise. According to Volvo, the Samsung excavators
underwent a process referred to as “Volvoization,” to prepare them to bear the Volvo
brand name. Volvo insists that the excavators were so extensively altered during this
process that they could no longer be considered a continuation of the prior product line.
FMS disputes this conclusion, arguing instead that the “Volvoized” excavators were
not so substantially different from the Samsung products as to have become an entirely
different animal. .

The sole contention that Volvo advances that could enable us to rule in its favor
as a matter of law relies upon the attachment of the Volvo trademark to the improved

machinery. They argue that this change, in and of itself, is substantial enough to

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ifthe court disagrees with that assessment. Miller v. LeSea Broadcasting. Inc., 87 F.3d
224, 230 (7th Cir. 1996). With these principles in mind, we turn to the parties’
motions.
DISCUSSION

In pertinent part, the Franchise Act prohibits a manufacturer from terminating
a franchise relationship unless the manufacturer complies with specified notice
requirements, acts in “good faith,” and has “good cause” for the termination. The
phrases “good faith” and “good cause” are terms of art defined within the Act. See 10
M.LR:S.A. §§ 1361(7), 1363(3)(C). To act in “good faith,” a manufacturer must display
“honesty in fact and the observance of reasonable commercial standards of fair dealing
in the trade.” The statute goes on to enumerate what circumstances will constitute
“good cause” for termination. Only one is pertinent to this case: good cause is found
when the manufacturer discontinues production or distribution of the franchise goods.

The motion filed by FMS first argues that Volvo violated the Franchise Act
because it acted arbitrarily, in bad faith, or unconscionably in its dealings with FMS
from the acquisition of the Samsung product line through the franchise termination.
As FMS notes, the descriptors it attaches to Volvo’s behavior mandate that Volvo must
have acted at random, without reason, in a shockingly unfair manner, dishonestly, or

in contravention of the reasonable commercial standards of fair dealing in the trade.

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constitute an eradication of the existing product line. We disagree that the Lanham
Act’s restrictions on sale of trademarked goods translates into a discontinuation of a
product line the moment that it is sold with a different brand attached to it.

Thus, the parties’ dispute distills to a fight over how much the excavators really
changed during “Volvoization” and whether the changes were so substantial as to
permit a conclusion that the Samsung construction equipment line was discontinued
within the meaning of the Franchise Act, giving Volvo the “good cause” required to
allow the eventual termination of FMS’s franchise. Clearly, this determination must
be preceded by resolution of issues of fact, an endeavor we cannot take up on the
present motions.

CONCLUSION

Based on the foregoing, the parties’ cross-motions for summary judgment are

denied.

Charles P. Kocoras

Chief Judge

United States District Court
Dated: (JAN 2 0 2005


UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
FMS, INC.,
Plaintiff,
00 C 8143

vs.

VOLVO CONSTRUCTION EQUIPMENT
NORTH AMERICA, INC.,

Defendant.

wee ewer wm

MEMORANDUM OPINION

CHARLES P. KOCORAS, Chief District Judge:

This matter comes before the court on the cross-motions of Plaintiff FMS, Inc.
(“FMS”) and Volvo Construction Equipment North America, Inc. (“Volvo”) for
summary judgment on the sole remaining count of the complaint. This count alleges
violation of the Maine Franchise Laws for Power Equipment, Machinery, and
Appliances (“Franchise Act”). 10 M.R.S.A. §§ 1361-70. For the reasons set forth
below, both motions are denied.

BACKGROUND
FMS is a former franchisor of Samsung construction equipment products,

including excavators, within the state of Maine. In mid 1998, Volvo bought Samsung


and assumed its contractual obligations with FMS. In late 1999, after a significant
amount of contact between the parties, Volvo notified FMS that it would terminate its
franchise with FMS. FMS and six other dealers (from states other than Maine) filed
suit in Arkansas state court in March 2000, alleging breach of contract and violations
of various state franchise and trade practice laws. The case was removed to federal
court in the Eastern District of Arkansas and then transferred to this court. After we
entered summary judgment on the whole of the complaint, the parties appealed. The
Seventh Circuit affirmed our decision save whether Volvo’s actions with respect to

FMS were done for good cause, as required by the Franchise Act. Cromeens.

Holloman, Sibert, Inc. v. AB Volvo, 349 F.3d 376, 391 (7th Cir. 2003). Each party has

now moved for summary judgment in its favor.
LEGAL STANDARD
Summary judgment is appropriate only if there is no genuine issue of material

fact and the moving party is entitled to judgment as a matter of law. See Fed. R. Civ.

Proc. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986). In seeking
a grant of summary judgment the moving party must identify “those portions of ‘the
pleadings, depositions, answers to interrogatories, and admissions on file, together with
the affidavits, if any’ which it believes demonstrate the absence of a genuine issue of

material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (quoting Fed. R. Civ.

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Proc. 56(c)). This initial burden may be satisfied by presenting specific evidence on
a particular issue or by pointing out “an absence of evidence to support the non-moving
party’s case.” Celotex, 477 U.S. at 325. Once the movant has met this burden, the
non-moving party cannot simply rest on the allegations in the pleadings, but “must set
forth specific facts showing that there is a genuine issue for trial.” Fed. R. Civ. Proc.
56(e). A “genuine issue” in the context of a motion for summary judgment is not

simply a “metaphysical doubt as to the material facts,” Matsushita Elec. Indus. Co.

Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986); rather, “[a] genuine issue exists

when the evidence is such that a reasonable jury could find for the non-movant,”

Buscaglia v. United States, 25 F.3d 530, 534 (7th Cir. 1994). When reviewing the

record we must draw all reasonable inferences in favor of the non-movant; however,
“we are not required to draw every conceivable inference from the record — only those

inferences that are reasonable.” Bank Leumi Le-Israel, B.M. v. Lee, 928 F.2d 232, 236

(7th Cir. 1991).

When parties file cross motions for summary judgment, each motion must be
assessed independently, and denial of one does not necessitate the grant of the other.
M. Snower & Co. v. United States, 140 F.2d 367, 369 (7th Cir. 1944). Rather, each
motion evidences only that the movant believes it is entitled to judgment as a matter

of law on the issues within its motion and that trial is the appropriate course of action

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