United States District Court, D. Oregon, Portland Division
COLD STONE CREAMERY LEASING COMPANY, INC., an Arizona Corporation, Plaintiff,
FW OR-GREENWAY TOWN CENTER, LLC, a Delaware Limited Liability Company, Defendant.
FINDINGS AND RECOMMENDATIONS
YIM YOU UNITED STATES MAGISTRATE JUDGE
Cold Stone Creamery Leasing Company, Inc. (âCold Stoneâ) has
filed a complaint against FW OR-Greenway Town Center, LLC
(âGreenwayâ) seeking declaratory judgment/specific
performance, damages for anticipatory breach of contract, and
attorney's fees. This court has diversity jurisdiction
pursuant to 28 U.S.C. Â§ 1332(a)(1).
parties have filed cross motions for summary judgment (ECF
#16, ECF #18). For the reasons discussed below, Cold
Stone's motion should be DENIED and Greenway's motion
should be GRANTED.
2, 2004, Cold Stone and U.S. Retail entered into a lease
agreement (“Lease Agreement”) through which Cold
Stone leased a retail space at the Greenway Town Center for a
period of ten years. ECF #15-1. The Lease Agreement also
references a First Addendum, which was signed on the same
date. ECF #15-2. The First Addendum contains an option for
Cold Stone to renew the lease for two consecutive five-year
periods. Id. at 1 (¶ 1. (a)). Greenway is the
successor to U.S. Retail's interest under the Lease
Agreement. Jt. Stip. of Facts ¶ 4, ECF #15.
December 16, 2013, Greenway and Cold Stone executed a Second
Addendum to the Lease agreement, through which Cold Stone
exercised its first five-year renewal option. ECF #15-3; ECF
April 13, 2018, Cold Stone provided written notice to
Greenway that it would be subletting the premises to a
franchisee, Twin Scoop, LLC (“Twin Scoop”). ECF
#15-4; ECF #15-7. Thereafter, the leasing agents for Cold
Stone and Greenway exchanged emails about
“historic/ongoing issues” with the current
operator, such as the store's appearance and cleanliness.
ECF #15-6, at 3. Greenway's leasing agent also noted that
store sales did not support market rent, and that the current
rent was 15-20% below market. Id. In response, Cold
Stone's leasing agent recognized “how much the
landlord has put into the center, ” and assured that
with the “new operator, things will be 100%
different” and “it will turn things around
completely.” Id. at 2. In response to Cold
Stone's suggestion that the parties put a fair market
value option in the lease renewal, Greenway's leasing
agent replied, “[A]s discussed, we'll be exploring
other options here. Let's pick this back up closer to the
expiration date.” Id. Cold Stone then sent two
emails to Greenway's leasing agent on May 2 and 3, 2018,
asking to exercise its five-year renewal option early:
Would the landlord be agreeable to allowing us to exercise
the current renewal option early? I know the window
doesn't open until August, but in order for our new
franchisee to secure his SBA loan, they wanted to get your
ECF #15-6, at 1 (May 2, 2018 email).
Just following up on this . . . any objection to us
exercising the renewal option early?
Id. (May 3, 2018 email). Greenway's leasing
agent responded, “[W]e are sticking with the lease
terms here.” Id.
25, 2018, Cold Stone executed a sublease agreement, effective
August 23, 2018, with franchisee Twin Scoop. ECF #15-9. An
exhibit to the sublease makes clear that the underlying lease
expires on July 31, 2019. Id. at 12.
September 7, 2018, Greenway notified Cold Stone that it was
declaring Cold Stone's second option to renew “null
and void, ” citing to Section 9.1 of the Lease
Agreement. ECF #15-10. Section 9.1 provides in pertinent
If [Cold Stone] assigns or otherwise transfers this Lease, or
sublets all or any portion of the Premises, with or without
[Greenway's] consent, then [Greenway] shall have the
right, at its sole option, to thereafter terminate all
renewal and expansion options granted to Tenant pursuant to
ECF #15-1, at 8.
FRCP 56(a), “[t]he court shall grant summary judgment
if the movant shows that there is no genuine dispute as to
any material fact and the movant is entitled to judgment as a
matter of law.” The party moving for summary judgment
bears the initial responsibility of informing the court of
the basis for the motion and identifying portions of the
pleadings, depositions, answers to interrogatories,
admissions, or affidavits that demonstrate the absence of a
triable issue of material fact. Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986). Once the moving party
does so, the nonmoving party must “go beyond the
pleadings” and “designate ‘specific facts
showing that there is a genuine issue for trial.'”
Id. at 324 (citing FRCP 56(e)).
determining what facts are material, the court considers the
underlying substantive law regarding the claims. Anderson
v. Liberty Lobby, 477 U.S. 242, 248 (1986). Otherwise
stated, only disputes over facts that might affect the
outcome of the suit preclude the entry of summary judgment.
Id. A dispute about a material fact is genuine if
there is sufficient evidence for a reasonable jury to return
a verdict for the non-moving party. Id. at 248-49. A
“scintilla of evidence” or “evidence that
is merely colorable or not significantly probative” is
insufficient to create a genuine issue of material fact.
Addisu v. Fred Meyer, Inc., 198 F.3d 1130, 1134 (9th
Cir. 2000). The court “does not weigh the evidence or
determine the truth of the matter, but only determines
whether there is a genuine issue for trial.” Balint
v. Carson City, Nev., 180 F.3d 1047, 1054 (9th Cir.