                                                                           FILED
                            NOT FOR PUBLICATION                             MAY 16 2013

                                                                        MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U .S. C O U R T OF APPE ALS




                            FOR THE NINTH CIRCUIT



BARJA INC., a California Corporation;            No. 11-56156
FRY’S 710 FREEWAY INVESTMENT
INC., a California Corporation,                  D.C. No. 2:10-cv-06936-ODW-
                                                 PLA
              Plaintiffs - Appellants,

  v.                                             MEMORANDUM *

EQUILON ENTERPRISES, LLC, a
Delaware limited liability company,

              Defendant - Appellee.



                    Appeal from the United States District Court
                       for the Central District of California
                     Otis D. Wright, District Judge, Presiding

                        Argued and Submitted April 9, 2013
                               Pasadena, California

Before: BERZON, TALLMAN, and M. SMITH, Circuit Judges.

       Barja Inc. and Fry’s 710 Freeway Investment, Inc. (“Appellants”) appeal the

district court’s summary judgment in favor of Equilon Enterprises, LLC.

Appellants operated Shell-brand service stations in California pursuant to Retail


        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
Facility Lease and Retail Sales Agreements with Equilon. They allege that Equilon

failed to comply with California Business & Professions Code § 20999.25 when it

decided to sell the service stations as part of a bulk transaction but did not properly

extend right of first refusal offers (“ROFRs”) to appellants. We have jurisdiction

under 28 U.S.C. § 1291, and we affirm.

      Parties to a bulk purchase transaction may allocate a portion of the total

purchase price to a single site in order to allow an existing franchisee to exercise a

right of first refusal, as long as the valuation of the individual property is readily

apparent from the bulk offer and the valuation has not been manipulated to the

franchisor’s advantage. Forty-Niner Truck Plaza, Inc. v. Union Oil Co. of Cal., 58

Cal. App. 4th 1261, 1279–80 (Cal. Ct. App. 1997) (citing Arnold v. Amoco Oil Co.,

872 F.Supp. 1493, 1499 (W.D. Va. 1995)). Appellants have failed to raise genuine

issues of material fact either that the valuations of the individual sites were not

readily apparent from the bulk offer or that Equilon manipulated the individual

property valuations. Celotex Corp. v. Catrett, 477 U.S. 317, 322–23 (1986).

      Likewise, appellants have failed to raise a genuine issue of material fact that

the ROFRs here did not “approach[] fair market value under an objectively

reasonable analysis,” Forty-Niner, 58 Cal. App. 4th at 1281 (citations omitted), and

thus were not bona fide offers under § 20999.25(a).


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Appellants remaining contentions are unpersuasive.

AFFIRMED.




                                  3
                                                                               FILED
Barja v. Equilon, No. 11-56156                                                  MAY 16 2013

                                                                           MOLLY C. DWYER, CLERK
BERZON, Circuit Judge, dissenting:                                           U .S. C O U R T OF APPE ALS




      I respectfully dissent. The record reflects a disputed issue of material fact as

to whether the right of first refusal offers (ROFRs) Equilon extended to Barja and

Fry’s provided the recipients of the offers with an opportunity to purchase the same

assets as the third party bidder, Apro, would acquire for the same price. A question

remains whether, for the offer price, Apro was buying something that Barja and

Fry’s were not. Summary judgment was therefore inappropriate.

      The record indicates that if Apro purchased the franchisees’ stations from

Equilon, it would acquire not only the land, improvements, and equipment at each

station site, but also the right to supply the stations with fuel, as the exclusive

wholesale distributor, for at least ten years. In contrast, the record suggests that if

Barja and Fry’s exercised their rights of first refusal and purchased their respective

stations at the prices identified by Apro, they would obtain no such wholesale

distribution rights, only the station property and its accouterments.

      Specifically, the record permits an inference that there was a value attributed

to the acquisition of the fuel supply rights, independent of the station property, and

that Apro was required to, and did, include that value in its overall bulk bid as well

as in the portions of the bulk bid attributed to Barja’s and Fry’s respective stations.


                                           -1-
Thus, contrary to the majority’s suggestion, the value Apro placed on the fuel

supply rights may not have simply reflected its ability to extract greater profit from

the stations than the franchisees could. If in fact Apro acquired and paid separately

for the distribution rights as part of the same transaction in which it acquired the

real estate and equipment, then Apro did not just “come to the table with [a]

different hand[],” Keener v. Exxon Co., U.S.A., 32 F.3d 127, 132 (4th Cir. 1994),

based on “preexisting or planned commercial relationships that g[a]ve it certain

advantages in acquiring a franchise on a particular site,” Forty-Niner Truck Plaza,

Inc. v. Union Oil Co., 58 Cal. App. 4th 1261, 1282 (1997) (emphasis added).

Instead, if that turns out to be so, then Apro purchased a commercial relationship

with Equilon—that of an exclusive, wholesale distributor of Shell gasoline—as

part of its bulk acquisition of the franchises in the Los Angeles area; the supply

rights were an asset for which Apro was paying; and the value of those rights was

reflected in the purchase price for each station, on which the ROFRs were based.

As the record facts give rise to these permissible inferences, summary judgment

should not have been granted, and we should be reversing for trial.

      That the individual station valuations were apparent from the face of Apro’s

bulk bid and that there was no evidence of price manipulation do not detract from

that conclusion. Those circumstances are necessary but not sufficient conditions to


                                          -2-
demonstrate compliance with California Business & Professions Code § 20999.25.

The California statute, like its federal counterpart, the Petroleum Marketing

Practices Act, 15 U.S.C. § 2801 et seq., provides that a franchisee must have a

bona fide opportunity to purchase from the franchisor the same interests in the

premises as are on offer to a third party purchaser. See Forty-Niner, 58 Cal. App.

4th at 1266, 1273–74. And it remains unclear on the present record whether that

fundamental requirement was met here.

      Accordingly, I would reverse the district court’s grant of summary judgment

in favor of Equilon.




                                         -3-
