Court Opinion

ID: 813927
Source: CourtListenerOpinion
Date Created: 2012-12-19 17:44:15+00
Date Added: 2024-06-11T18:00:50.429215
License: Public Domain

NOT PRECEDENTIAL
 UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT
                     _____________

                  Nos. 10-2813, 10-2992, and 11-1142
                           _____________

               *JOC INC., t/a SUMMIT EXXON;
      SUNG EEL CHANG AUTO, INC., t/a ASHWOOD EXXON

                                   v.

                     EXXONMOBIL OIL CORP.;
                      EXXON MOBIL CORP.

      ExxonMobil Oil Corp. Appellant in Nos. 10-2813 and 11-1142
 Sung Eel Chang Auto, Inc., t/a Ashwood Exxon Appellant in No. 10-2992

      * Dismissed pursuant to Court Order entered January 17, 2012
                            _____________

            On Appeal from the United States District Court
                   for the District of New Jersey
                      (D.C. No. 2-08-cv-05344)
                 District Judge: Stanley R. Chesler
                           _____________

              Submitted Under Third Circuit LAR 34.1(a)
                         December 18, 2012

Before: MCKEE, Chief Judge, SLOVITER, and VANASKIE Circuit Judges

                      (Filed: December 19, 2012)
                            _____________

                              OPINION
                            _____________

                                   1
SLOVITER, Circuit Judge.

       The ExxonMobil Oil Corporation (“Exxon”) and Sung Eel Chang Auto, Inc., t/a

Ashwood Exxon (“Ashwood”),1 cross-appeal from a District Court preliminary

injunction that barred Exxon from terminating the Ashwood franchise for certain reasons.

Because the franchise no longer exists, there is no live controversy before us and we will

dismiss the appeals as moot.

                                      I. Background

       We write primarily for the parties and recount only the essential facts. The three

consolidated appeals in this case concern the former Ashwood Exxon gas station, which

led a troubled existence as an Exxon franchise from 1996 until 2011. As a franchisee,

Ashwood leased its property from Exxon and was obligated to purchase its gasoline from

Exxon. In 2008 Ashwood filed suit against Exxon in New Jersey state court, alleging

that Exxon charged it higher wholesale rates for gasoline than it charged competing

stations, and that the divergent pricing violated New Jersey law. Exxon argued that its

pricing was lawful and that Ashwood’s own business practices were the cause of its

financial distress. The suit was removed to federal court on the grounds of diversity of

citizenship.

1
 Ashwood is the sole remaining plaintiff in the underlying action. The second original
plaintiff, JOC, Inc. t/a Summit Exxon, settled with Exxon and withdrew while these
appeals were pending.

                                             2
       In 2009, Ashwood stopped paying rent. Exxon commenced proceedings to

terminate the franchise, and Ashwood moved for a preliminary injunction to bar

termination while the lawsuit was ongoing.2 Between May and December of 2010 the

District Court issued three orders that, in combination, partially granted and partially

denied the injunction. Their final effect was to bar Exxon from terminating the franchise

on the basis of Ashwood’s contractual violations prior to December 2010. The District

Court declined, however, to prohibit Exxon from terminating the franchise on any new

ground that might arise. Exxon appealed the partial bar, and Ashwood cross-appealed

the denial of a broader injunction.3

       After the appeals were filed, Exxon terminated the Ashwood franchise, effective

May 2011, on the basis of Ashwood’s new violations of its contractual obligations.

Ashwood was evicted from the station premises in January 2012.4

2
  Prior to the preliminary injunction, the parties conducted settlement negotiations and
litigated a motion to dismiss. See JOC, Inc. v. ExxonMobil Oil Corp., 2010 WL 1380750
(D.N.J. April 1, 2010) (partially granting and partially denying Exxon’s motion).
Ashwood filed an Amended Complaint after the District Court issued its opinion.
3
  As docketed, No. 10-2813 is Exxon’s appeal of the May 18 and June 4 injunction
orders, No. 10-2992 is Ashwood’s cross-appeal from the June 4 order, and No. 11-1142
is Exxon’s appeal of the December 13 order.
4
  Exxon provided these facts in response to an inquiry from this court directing the parties
to address whether the Ashwood franchise continued to exist and, if not, whether the
appeals of the District Court’s interlocutory orders were moot. See In re Cantwell, 639
F.2d 1050, 1054 n.4 (3d Cir. 1981) (“[F]acts bearing on the issue of mootness can be
raised at any time during the judicial proceedings.”). Ashwood did not respond to the
court’s inquiry. We therefore take the facts to be uncontested.

                                              3
                                         II. Analysis

       We have jurisdiction to review orders of the District Court granting or denying a

preliminary injunction under 28 U.S.C. § 1292(a)(1) (2006), but “[w]e do not have

jurisdiction to hear a case that cannot affect the rights the appellant wishes to assert.”

Salovaara v. Jackson Nat'l Life Ins. Co., 246 F.3d 289, 296 (3d Cir. 2001) (per curiam).

“The mootness doctrine is centrally concerned with the court's ability to grant effective

relief.” Cnty. of Morris v. Nationalist Movement, 273 F.3d 527, 533 (3d Cir. 2001). “[I]f

an event occurs while a case is pending on appeal that makes it impossible for the court

to grant any effectual relief whatever to a prevailing party, the appeal must be dismissed

[as moot].” Church of Scientology of California v. United States, 506 U.S. 9, 12 (1992)

(internal quotation marks omitted).

       In appealing the partial preliminary injunction, Exxon sought the right to terminate

the Ashwood franchise, and Ashwood sought to prevent termination. The franchise no

longer exists. Even if Exxon had not terminated it, Ashwood’s franchise contract would

have expired in February 2012. Because there is no longer any franchise to terminate or

to save, we cannot grant either party effective relief.

       The appeals are accordingly dismissed as moot.5

5
  There is no need to vacate the underlying orders, as United States v. Munsingwear, Inc.,
340 U.S. 36, 39-40 (1950), requires of final judgments when appeals become moot. “[I]t
is sufficient to dismiss the appeal without directing that the injunction order be vacated.”
13C Charles A. Wright et al., FEDERAL PRACTICE AND PROCEDURE § 3533.10.3 (3d ed.
2012). Accord Nelson v. Quick Bear Quiver, 546 U.S. 1085, 1085 (2006); Clark v. K-
Mart Corp., 979 F.2d 965, 969 (3d Cir. 1992) (en banc). Although the injunction is
moot, the dispute between the parties remains unresolved. We express no opinion as to
                                              4
whether Ashwood has a viable claim for damages from Exxon, an issue not raised in the
appeal before us.
                                          5