                 NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
                            File Name: 15a0120n.06

                                      Nos. 14-3038/-3064

                          UNITED STATES COURT OF APPEALS
                               FOR THE SIXTH CIRCUIT

PAGE PLUS OF ATLANTA, INC. and SNAP )
                                                                                FILED
                                                                           Feb 10, 2015
PREPAID, LLC,                               )
                                                                       DEBORAH S. HUNT, Clerk
                                            )
     Plaintiffs-Appellants/Cross-Appellees, )
                                                                ON APPEAL FROM THE
                                            )
                                                                UNITED STATES DISTRICT
v.                                          )
                                                                COURT     FOR     THE
                                            )
                                                                NORTHERN DISTRICT OF
OWL WIRELESS, LLC,                          )
                                                                OHIO
                                            )
     Defendant-Appellee/Cross-Appellant.    )
                                            )



       Before: SUTTON, McKEAGUE, and KETHLEDGE, Circuit Judges.

       KETHLEDGE, Circuit Judge. Page Plus distributed prepaid cellular phones and minutes

for Owl Wireless. In 2008, Page Plus and Owl signed a distribution contract that set prices on

those products and defined Page Plus’s distribution territory. Page Plus alleges it later assigned

its rights under the contract to SNAP Prepaid. SNAP sued Owl in 2011, alleging that Owl had

charged it prices in excess of those promised in the distribution contract. Owl responded with

counterclaims against SNAP and Page Plus, alleging that one or both of them had sold to

customers to which Owl had exclusive sales rights.

       The district court eventually granted summary judgment sua sponte to Owl on SNAP’s

contract claim. SNAP now challenges that grant on both procedural and substantive grounds.

SNAP and Page Plus also challenge the court’s interpretation of contract language relevant to
No. 14-3038/3064, Page Plus of Atlanta, Inc. v. Owl Wireless, LLC


Owl’s counterclaims—claims that Owl voluntarily dismissed. We affirm the judgment, and

dismiss No. 14-3038 to the extent it raises issues relevant only to Owl’s counterclaims.

                                                I.

       Owl sells prepaid cell phones and minutes for those phones—either in the form of phone

cards or electronic PIN numbers—to multiple distributors. In October 2008, Owl signed a two-

year contract with the distributor Page Plus. The contract set prices on certain phones, phone

cards, and PIN numbers; guaranteed Page Plus the best available prices on those products; and

required Owl to apply “price change[s]” on those products “to all of [its] other distributors[.]”

The contract also required Page Plus to transfer the accounts for two of its largest customers—

Blackstone and Budget—to Owl.

       Shortly thereafter, Page Plus’s owner, Steve Harris, and its top executive, Michael

Lizdas, formed SNAP, each taking an ownership share in the new company. What happened

next is disputed: Lizdas and Harris say they had “multiple conversations” during which the men

orally assigned Page Plus’s contract rights to SNAP. But Lizdas and Harris undisputedly never

wrote down their agreement, or made a general announcement to their employees, or told Owl’s

executives about the assignment—which allegedly took effect on January 1, 2009.

       Within two months of that date, SNAP made its first of many sales to Blackstone.

Several months later, SNAP began selling cellular minutes to Budget. These sales eventually

totaled more than $22 million. Meanwhile, in September 2009, Owl increased the price charged

to SNAP for phone cards from 77% of their face value to 78%. Owl’s other distributors that

bought phone cards at the 77% mark also saw a 1% increase. But Owl did not change the prices

charged to some distributors paying more than 77%, thereby reducing SNAP’s pricing advantage

over those distributors.



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No. 14-3038/3064, Page Plus of Atlanta, Inc. v. Owl Wireless, LLC


       In 2010, Page Plus sued Owl for breach of contract. In a verified complaint, Page Plus

(rather than SNAP) alleged that Owl had breached the contract by reducing the differential

between the prices charged to Page Plus and those charged to other distributors. Owl answered

that Page Plus had breached the contract by selling to Blackstone and Budget. More than a year

into litigation, however, Page Plus apparently figured out that SNAP, rather than Page Plus, had

made all of the purchases that were the basis of Page Plus’s breach of contract claim. Page Plus,

therefore, moved for leave to add SNAP as a party to the case. The district court denied the

motion, and in a stipulated order dismissed the complaint without prejudice.

       Three weeks later, Page Plus and SNAP brought this lawsuit, which asserted the same

claims Page Plus had asserted in the prior suit, but added SNAP as a party. Owl again asserted

its counterclaims. For the first time, however, the plaintiffs alleged that Page Plus had assigned

its contract to SNAP on January 1, 2009. SNAP therefore asserted the price-differential claim

instead of Page Plus; and Owl alleged that one or both plaintiffs, not Page Plus alone, had

breached the contract.

       On cross-motions for summary judgment, the district court held that both sides had

breached the contract: Owl by raising the prices charged to SNAP, and one or both plaintiffs by

selling to Blackstone and Budget. But the court left the issue of damages for a jury to decide.

Each side thereafter filed motions in limine to preclude the other from producing any evidence of

damages. Specifically, Owl moved to exclude such evidence on the ground that SNAP had not

become a party to the contract through a valid assignment. In August 2012, the court denied the

motion—observing that it was “almost a summary judgment request.”

       But the court soon revisited the alleged assignment.        On September 14, the court

requested supplemental briefing on the “legal significance of Page Plus’s alleged assignment to



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No. 14-3038/3064, Page Plus of Atlanta, Inc. v. Owl Wireless, LLC


Snap[.]” On October 5, the court held a phone conference during which the court said that it

would “determine whether the issue [i.e., whether Page Plus had assigned its contract rights to

SNAP] is appropriate for trial.” The parties each “agreed the record [was] complete” on whether

a valid assignment had occurred. Five days after the conference, however, SNAP and Page Plus

filed a declaration and financial records in an attempt to shore up their allegation that Page Plus

had assigned its contract rights to SNAP. The district court was unpersuaded, and thereafter sua

sponte granted summary judgment to Owl on SNAP’s contract claim, holding that SNAP had not

presented enough evidence to create a genuine dispute of fact as to whether Page Plus had

assigned its contract rights to SNAP. Owl then voluntarily dismissed its counterclaims, but

reserved the right to reassert the claims if SNAP obtained reversal of any of the court’s rulings.

       Both sides then appealed. We dismissed those appeals for lack of jurisdiction, because

the conditional nature of Owl’s voluntary dismissal meant that the appeals were not from a “final

decision[]” of the district court. See 28 U.S.C. § 1291. On remand, the parties stipulated to an

order dismissing Owl’s counterclaims without prejudice. These appeals followed.

                                                 II.

                                                A.

                                                 1.

       SNAP argues that the district court improperly granted summary judgment sua sponte,

asserting that the district court “never gave notice that it planned to grant summary judgment[.]”

Appellant Br. 33. A district court may grant summary judgment sua sponte after “giving notice

and a reasonable time to respond[.]” Fed. R. Civ. P. 56(f). To determine whether a court gave

adequate notice, we ask whether the losing party knew “that [it] had to muster the necessary facts

to withstand summary judgment[.]” Smith v. Perkins Bd. of Educ., 708 F.3d 821, 829 (6th Cir.



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No. 14-3038/3064, Page Plus of Atlanta, Inc. v. Owl Wireless, LLC


2013) (citation omitted). We review a court’s compliance with the notice requirement for an

abuse of discretion. Id. at 828.

       Two events are relevant here. The first is Owl’s motion in limine. Despite its label, that

motion—which asserted that Page Plus had not assigned its contract to SNAP—functioned as a

motion for summary judgment. The parties understood as much: in a brief and at a hearing,

SNAP argued that the assignment’s existence was “a jury issue” for nearly the same reasons that

SNAP now offers on appeal. Moreover, the parties knew that the motion, if granted, would

prevent SNAP from proving that it had suffered damages—which is an essential element of a

contract claim. See Tidewater Fin. Co. v. Cowns, 968 N.E.2d 59, 62 (Ohio Ct. App. 2011).

Thus, by the time the district court granted summary judgment to Owl on the ground that SNAP

lacked evidence of an assignment, the parties had fully briefed that issue and knew full well its

importance to this litigation.

       Second, during the phone conference on October 5, the district court told the parties that

it intended to “determine whether the [assignment] issue is appropriate for trial.” The court’s

statement gave the parties unequivocal notice that the court might decide that SNAP had not

presented evidence sufficient to create a genuine issue as to whether SNAP was an assignee

under the contract—which everyone knew would defeat SNAP’s claim. That SNAP knew that it

needed to submit all of its evidence on that issue is made clear by SNAP’s decision to submit

additional documents five days after it had agreed with the district court that “the record [was]

complete[.]”

       The sua sponte nature of the district court’s decision was, therefore, only nominal. And

even if SNAP might legitimately claim to have been surprised by the district court’s summary-

judgment ruling, SNAP suffered no prejudice.         SNAP presented all of its arguments and



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No. 14-3038/3064, Page Plus of Atlanta, Inc. v. Owl Wireless, LLC


evidence in its motion for reconsideration, and the district court duly considered them in denying

the motion. The district court did not abuse its discretion in granting summary judgment when it

did.

                                                  2.

       SNAP challenges the basis of the district court’s determination that SNAP did not present

evidence creating a genuine issue as to whether Page Plus had assigned the contract to SNAP.

We review that determination de novo. Montell v. Diversified Clinical Services, 757 F.3d 497,

503 (6th Cir. 2014).

       The parties agree that Ohio law governs the question whether Page Plus assigned the

contract to SNAP. An alleged assignee under a contract “must allege and prove the assignment”

to bring a claim under the contract. Zwick & Zwick v. Suburban Const. Co., 134 N.E.2d 733, 734

(Ohio Ct. App. 1956). For an assignment to be valid, the parties must intend to make one and

exchange consideration. Nee v. State Indus., Inc., 3 N.E.3d 1290, 1304-05 (Ohio Ct. App. 2013).

       The district court held that SNAP had not presented evidence creating a genuine issue

that Page Plus had assigned the contract to SNAP. See generally Marie v. Am. Red Cross, 771

F.3d 344, 351 (6th Cir. 2014). Specifically, the court observed that the conduct of SNAP and

Page Plus “during the history of this litigation . . . supports the opposite conclusion—Page Plus

did not believe it had assigned the [contract] to Snap.” The court pointed out that Page Plus had

filed a verified complaint alleging that Owl had injured Page Plus, not SNAP; that Lizdas had

stated in an interrogatory answer that “Page Plus Atlanta, Inc. is the only party to the 2008

Distributor Agreement with Owl” (emphasis added); and that SNAP itself had not sought to

assert a contract claim until more than a year into the earlier lawsuit.




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No. 14-3038/3064, Page Plus of Atlanta, Inc. v. Owl Wireless, LLC


       But SNAP asserts that its evidence—primarily a handful of sworn statements from

Lizdas, Harris, and an accountant—would allow a jury to find that an assignment had occurred.

Both Lizdas and Harris testified in a conclusory fashion that, acting on behalf of Page Plus, they

had orally assigned the contract to SNAP. But they offer no details whatsoever as to when or

how, exactly, this assignment occurred.        Meanwhile, even this conclusory assertion is

contradicted by Lizdas’s previous sworn statement in his interrogatory representing that Page

Plus was the sole party to the contract with Owl. Likewise, the accountant’s declaration—filed

after the district court had granted summary judgment—says nothing about when or how Page

Plus assigned its contract rights to SNAP.

       SNAP also cites several emails suggesting that Owl thought itself obliged to deal with

SNAP pursuant to the distribution contract.       But Owl’s executive vice-president, Yassine

Yassine, thought that Page Plus had simply changed its name to SNAP. That understanding is

consistent with an email from Lizdas saying that Owl had breached its contract with “Page Plus”

months after the assignment supposedly took place. And in any event Owl’s emails are not

significant evidence of whether Page Plus intended to assign its own rights to SNAP.

       Finally, SNAP points out that on one occasion Owl’s bookkeeper asked SNAP to send

Owl a W-9 form for “the new company[.]” But Owl made that request in response to a request

by SNAP to change its name on purchase orders. That SNAP even cites this exchange is proof of

how weak its case is.

       In summary, to show that an assignment occurred, SNAP principally relies on conclusory

assertions uncorroborated by other evidence and belied by its own litigation conduct. Its proofs

are a thin gruel of circumstantial evidence insufficient to sustain this case through trial. The

district court correctly granted summary judgment to Owl on SNAP’s contract claim.



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No. 14-3038/3064, Page Plus of Atlanta, Inc. v. Owl Wireless, LLC


                                               B.

       SNAP and Page Plus also appeal a ruling—specifically, that the sales to Blackstone and

Budget breached the contract—relevant only to counterclaims that Owl voluntarily dismissed

with both sides’ consent. With exceptions not relevant here, litigants may not appeal a favorable

judgment or a judgment entered with their consent. Fairley v. Andrews, 578 F.3d 518, 521-22

(7th Cir. 2009); ASARCO, Inc. v. Sec’y of Labor, 206 F.3d 720, 722-23 (6th Cir. 2000). The

judgment dismissing Owl’s claims was favorable to SNAP, and SNAP indeed consented to that

judgment. SNAP therefore cannot appeal rulings relevant only to claims dismissed by that

judgment.

       No. 14-3038 is dismissed to the extent it raises issues related to Owl’s counterclaims, and

the district court’s judgment is affirmed. Owl’s cross-appeal, No. 14-3064, is dismissed as moot.




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