Contract analysis

I. INTRODUCTION Plaintiff Verimark Hospitality Group Inc. ("Verimark") respectfully submits this Response in Opposition to Defendants' Cross-Motion for Summary Judgment (the "Cross-Motion") filed on October 13, 2023, by Defendants Coastal Palms Franchise Holdings LLC ("Coastal Palms"), Randall Brecker ("Brecker"), and Suncoast Room Management Inc. ("Suncoast") (collectively, "Defendants"). For the reasons set forth b

II. STATEMENT OF FACTS The following facts are drawn from the record evidence, including the FLAs, deposition transcripts, discovery responses, expert reports, and documents produced in discovery. Consistent with the summary judgment standard, all facts and reasonable inferences are stated in the light most favorable to Verimark as the non-movant on the Cross-Motion. A. The Franchise Relationship Verimark Hospitality

III. LEGAL STANDARD Under Florida Rule of Civil Procedure 1.510, as amended effective May 1, 2021, a 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." Fla. R. Civ. P. 1.510(a). The 2021 amendment adopted the federal summary judgment standard set forth in Celotex Corp. v. Catrett, 477 U.S. 317 (19

IV. ARGUMENT A. Defendants Are Not Entitled to Summary Judgment on Count I (Breach of Contract — Royalties) or Count II (Breach of Contract — Marketing Fund) Counts I and II allege that Coastal Palms breached its obligations under FLA §§ 4.1 and 4.2 by systematically underreporting GRR and thereby underpaying royalties and marketing-fund contributions over a nine-year period. The Cross-Motion seeks summary judgment o

1. The GRR Definition in FLA § 4.1 Is Unambiguous. The threshold question on Counts I and II is whether the GRR definition in FLA § 4.1 is ambiguous. It is not. Under Florida law, a contract term is ambiguous only if it is "susceptible to more than one reasonable interpretation." Dadeland Depot, Inc. v. St. Paul Fire & Marine Ins. Co., 945 So. 2d 1216, 1223 (Fla. 2006). The court must first examine the plain language

Section 4.1 defines GRR as: "all revenues derived from or attributable to the rental of guest rooms at the Hotel, including revenues from any booking channel, direct or indirect, and regardless of the entity collecting such revenue." (FLA-001, § 4.1 (emphasis added).) Every operative phrase in this definition reinforces the breadth of the GRR concept. The word "all" is the broadest term of inclusion in the English la

2. The Record Establishes Systematic Underreporting as a Matter of Undisputed Fact. Even if the Court were to move beyond the threshold question of contract interpretation and examine the factual record, the evidence of systematic underreporting is overwhelming and largely undisputed. The Cross-Motion does not—and cannot—contest the core facts that underpin Counts I and II. Brecker's Deposition Admissions. Randall Br

3. Defendants' "Reasonable Interpretation" Defense Is Meritless. Defendants devote the bulk of their Cross-Motion memorandum to the argument that even if their interpretation of the GRR definition ultimately proves incorrect, they adopted a "reasonable interpretation" of the contract in good faith and therefore cannot be held liable for breach. This argument fails for multiple independent reasons. First, the "reasona