law 350 discussion 2
In 1974, Berliner Foods Corporation (Berliner), pursuant to an oral contract, became a distributor for Häagen-Dazs ice cream. Over the next decade, both parties flourished as the marketing of high-quality, high-priced ice cream took hold. Berliner successfully promoted the sale of Häagen-Dazs to supermarket chains and other retailers in the Baltimore–Washington, DC, area. In 1983, the Pillsbury Company acquired Häagen-Dazs. Pillsbury adhered to the oral distribution agreement and retained Berliner as a distributor for Häagen-Dazs ice cream. In December 1985, Berliner entered into a contract and sold its assets to Dreyer’s, a manufacturer of premium ice cream that competed with Häagen-Dazs.
Dreyer’s ice cream had previously been sold primarily in the western part of the United States. Dreyer’s attempted to expand its market to the east by choosing to purchase Berliner as a means to obtain distribution in the mid-Atlantic region. When Pillsbury learned of the sale, it advised Berliner that its distributorship for Häagen-Dazs was terminated.
Berliner, which wanted to remain a distributor for Häagen-Dazs, sued Pillsbury for breach of contract, alleging that the oral distribution agreement with Häagen-Dazs and Pillsbury was properly assigned to Dreyer’s. Who wins? Why?
