Argued: May 10, 2019
from the United States District Court for the Eastern
District of Michigan at Detroit. No. 2:16-cv-12022-David M.
Lawson, District Judge.
Warrow, KICKHAM HANLEY PLLC, Royal Oak, Michigan, for
N. Khawaja, KIRKLAND & ELLIS LLP, New York, New York, for
Warrow, Gregory D. Hanley, KICKHAM HANLEY PLLC, Royal Oak,
Michigan, for Appellant.
N. Khawaja, KIRKLAND & ELLIS LLP, New York, New York,
Daniel A. Bress, KIRKLAND & ELLIS LLP, Washington, D.C.,
Thomas W. Cranmer, MILLER CANFIELD, Troy, Michigan, for
Before: ROGERS, DONALD, and THAPAR, Circuit Judges.
Bernice Bouie Donald, Circuit Judge.
case arises from a failed negotiation regarding a potential
distribution agreement. The involved entities are a
threesome: Knight Capital Partners Corp. ("KCP"),
the plaintiff who had hoped to act as a middleman in a
potential distribution deal for a novel cleaning product;
Henkel Corporation, a large industrial and consumer products
company that KCP targeted as a potential distributor; and
Henkel AG & Company, KGaA ("Henkel KGaA"), the
only named-defendant and the parent company of Henkel
Corporation. KCP places the blame on Henkel KGaA for the
shorthand version is that KCP and Henkel Corporation entered
into a non-disclosure agreement ("NDA") to aid in
the negotiations of a potential distribution deal. Pursuant
to the NDA, KCP would provide Henkel Corporation with
confidential information about a purportedly novel cleaning
product. Following a year of exchanging information and
engaging in negotiations, the NDA lapsed, no deal was
consummated, and the parties discontinued commercial
communication. KCP asserts that Henkel Corporation's
parent company, Henkel KGaA, used confidential information it
acquired through the NDA to develop the product on its own
and also interfered with the potential distribution deal.
KCP filed a lawsuit against Henkel KGaA for breach of the NDA
and tortious interference. The district court granted summary
judgment in favor of Henkel KGaA on both claims. As to the
breach of contract claim, the district court found that
Henkel KGaA was not a party to the NDA and thus could not be
liable for its breach. As to the tortious interference claim,
the district court found that Henkel KGaA is the parent
company of Henkel Corporation, so the parent-subsidiary
privilege immunizes it from a tortious interference claim
involving its subsidiary; further, the district court found
that the narrow "improper motive" exception to that
privilege does not apply. KCP appeals each aspect of the
district court's summary judgment order. KCP also appeals
the district court's denial of its motion for sanctions
and its motion to amend.
reasons that follow, we AFFIRM the district
court's grant of summary judgment to Henkel KGaA,
AFFIRM the district court's denial of
KCP's motion to amend, and REVERSE and
REMAND the district court's order
denying KCP's motion for sanctions.
Standard of Review
review the district court's grant of summary judgment de
novo. Blackmore v. Kalamazoo Cty., 390 F.3d 890,
894-95 (6th Cir. 2004). Summary judgment is proper when there
is no genuine dispute of material fact and the moving party
is entitled to judgment as a matter of law. Fed.R.Civ.P.
56(a). Henkel KGaA, as the moving party, bears the initial
burden of demonstrating the absence of genuine disputes of
material fact. Celotex Corp. v. Catrett, 477 U.S.
317, 323 (1986). It may do so by offering affirmative
evidence that negates an element of KCP's claims or by
pointing to an absence of evidence to support KCP's
claims. If Henkel KGaA satisfies its burden, KCP must then
set forth the specific facts showing that there is a genuine
dispute for trial. Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 256 (1986).
evaluating the evidence, we draw all reasonable inferences in
favor of KCP. Blackmore, 390 F.3d at 895 (citing
Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 587 (1986)). KCP must put forth more than a
mere "scintilla" of evidence to survive summary
judgment; the jury must be able to reasonably find for KCP.
Anderson, 477 U.S. at 252.
Breach of Contract Claim
first claims that Henkel KGaA violated the terms of the NDA
by using its confidential information in ways not permitted
under the NDA. The district court found that Henkel KGaA
cannot be sued for breach of the NDA because Henkel KGaA ...