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Brilliant DPI Inc. v. Konica Minolta Business Solutions, U.S.A. Inc.

United States District Court, E.D. Wisconsin

March 26, 2019

BRILLIANT DPI, INC., Plaintiff,
v.
KONICA MINOLTA BUSINESS SOLUTIONS, U.S.A., INC., et al, Defendants.

          DECISION AND ORDER

          WILLIAM E. DUFFIN U.S. MAGISTRATE JUDGE.

         INTRODUCTION

         Plaintiff Brilliant DPI, Inc. filed this action against defendants Konica Minolta Business Solutions, U.S.A., Inc., Konica Minolta Premiere Finance, Electronics for Imaging, Inc., and CIT Technology Financing Services, Inc. Against Konica Minolta Business Solutions and Konica Minolta Premiere Finance (collectively, “Konica”) they allege fraudulent misrepresentation under Wisconsin's Deceptive Trade Practices Act (Wis. Stat. § 100.18), negligent misrepresentation, intentional misrepresentation/fraudulent inducement, intentional interference with business relations, and breach of contract (ECF No. 1, ¶¶ 36-71); against Electronics for Imaging they allege common law negligence, breach of implied warranty of merchantability, breach of implied warranty of fitness for a particular purpose, and res ipsa loquitur (id., ¶¶ 72-94); and against CIT they seek a declaration that they are not liable for any amounts allegedly owed through a lease agreement entered into with Konica and later assigned to CIT (id., ¶¶ 95-98). In response, CIT filed their “Answer, Affirmative Defenses, and Counter-claim, ” alleging counterclaims against Brilliant for breach of contract, replevin, unjust enrichment, and quantum meruit. (ECF No. 9.)

         CIT moves to sever Brilliant's claim for declaratory relief as well as its counterclaims against Brilliant and transfer venue to the United States District Court for the District of New Jersey pursuant to 28 U.S.C. § 1404 and Federal Rule of Civil Procedure 21. (ECF No. 37.) All parties have consented to the full jurisdiction of a magistrate judge. (ECF Nos. 3, 21, 22, 30.) CIT's motion is ready for resolution.

         FACTS

         The following facts are taken from the complaint.

         Brilliant is a graphics company that professionally prints a variety of projects for businesses and individuals. (ECF No. 1, ¶ 10.) In July 2015 it entered into discussions with Konica to lease a mid-level production flatbed LED printer. (Id., ¶ 14.) Brilliant expressed that it wanted to be able to print on high-value, specialty rigid and inflexible substrates. (Id., ¶ 15.)

         With Brilliant's desires in mind, Konica representatives recommended to Brilliant a H1625 LED Wide Format Printer manufactured by Electronics for Imaging. (ECF No. 1, ¶ 16.) Konica represented, among other things, that the H1625 printer would be able to print in the manner described by Brilliant. (Id.) Based on Konica's recommendation, in July 2015 Brilliant agreed to enter into an equipment lease agreement with Konica to finance the purchase of the printer. (Id., ¶ 17.) At some point after the lease agreement was executed, Konica assigned all or part of the lease to CIT. (Id., ¶ 18.)

         The printer was delivered to Brilliant's place of business and Brilliant employees were trained by Konica technicians on both the operational use and cleaning procedures associated with the printer. (ECF No. 1, ¶ 19.) Almost immediately, Brilliant began experiencing problems with the printer. (Id., ¶ 20.) After nearly a year of troubleshooting and service on the printer, representatives of Electronics for Imaging and/or Konica determined that the printer was defective and replaced it with a new printer. (Id., ¶ 24.) The July 2015 lease agreement was rescinded and a new lease was executed on October 27, 2016. (Id., ¶ 25.) As before, Konica assigned all or part of the October 2016 lease agreement to CIT. (Id., ¶ 26.)

         Brilliant also experienced problems with the replacement H1625 printer, and it was ultimately determined that the replacement printer was unable to produce marketable materials. (ECF No. 1, ¶¶ 27-30.) These failures caused significant delays in Brilliant's purchase orders, severely impacted the quality of work it was able to produce, and caused Brilliant to lose substantial revenue and customers. (Id., ¶¶ 32-33.)

         This lawsuit followed in May 2018. In part, Brilliant seeks a declaration that it is not liable to CIT for any amounts allegedly owed through the October 2016 lease agreement because of Konica's breach of the agreement. (ECF No. 1, ¶ 98.)

         ANALYSIS

         The October 2016 lease agreement contains a forum-selection clause in Paragraph 13, which provides in pertinent part:

If the Lessor or its Assignee shall bring any judicial proceeding in relation to any matter arising under the Agreement, the Customer irrevocably agrees that any such matter may be adjudged or determined in any court or courts in the state of the Lessor or its Assignee's principal place of business, or in any court or courts in Customer's state of residence, or in any other court having jurisdiction over the Customer or assets of the Customer, all at the sole election of the Lessor. The Customer hereby irrevocably ...

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