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Star Funding Inc. v. Vault Minerals LLC

Price for Tires Reasonable; 'Margin' Fee Is Interest on Relevant 'Loan' in Agreement

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MEMORANDUM DECISION AND ORDER

*1 In October 2013, Plaintiff Star Funding, Inc. and Defendant Vault Minerals, LLC (“Vault”) entered into a Supply Agreement (“Agreement,” Aff. of Jo-Ann Erhard (“Erhard Aff.”), ECF No. 266, Ex. B) in which Plaintiff promised to purchase tires on behalf of Vault for Vault’s resale. (Amended Report and Recommendation (“Report”), ECF No. 291, at 2.) Per the Agreement, Vault would reimburse Plaintiff for the purchase price of the tires and related expenses. (Id.; see also Agreement §4(a)). Plaintiff also agreed to pay Vault a “margin” fee equal to 2.5 percent of total amount of any purchase price and expenses for each thirty-day period (or portion thereof) during which Plaintiff was not reimbursed by Vault. (Report at 2 n.1; Agreement §4(a).) In April and June 2014, Plaintiff alleges that Tire Center, Inc. (“TCI”), a buyer of resale and wholesale tires, placed two orders for tires with Vault, each for $1,626,720. (Report at 2.) TCI claimed that the orders had been illegitimately placed by an unauthorized employee and refused to pay for the orders. (Id.) Plaintiff was eventually fully reimbursed for the amount of the April 2014 purchase order, but not for the amount of the June 2014 purchase order. (Erhard Aff., Ex. C (Statement of Amount Due); Def’s. Ctrstmt. to Pl. 56.1 Stmt., ECF. No. 241,7.) When Plaintiff did not receive the remaining balance for the tires, it notified Vault of its intention to resell them. (Decl. of Alex Spizz*2

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