T-Mobile's Contract With Unimax Had Provision for Canceling POs, Says Motion

T-Mobile’s contract for the purchase of mobile phones from Unimax authorized it to cancel purchase orders (POs) before receipt of the phones “without incurring any liability,” said the defendant’s motion to dismiss (docket 2:23-cv-01830) Unimax's breach of contract suit in U.S. District Court for Western Washington in Seattle.

Unimax alleged in its November complaint (see 2311290029 that T-Mobile breached its contractual obligations by failing to accept delivery of nearly half a million devices. The companies entered into a contractual master agreement May 28, 2021, for the development, manufacturing, shipping, delivery and purchase of Unimax mobile devices, said the complaint.

Under the contract, T-Mobile sent POs for 951,720 U696CL mobile devices in May, for 524,160 devices from May to October and for 427,500 devices in November, the complaint said. The following May, T-Mobile informed Unimax that under an OEM addendum to the master agreement, it had the contractual right to cancel its orders for 427,500 devices, “despite making representations it would accept delivery,” said the complaint.

After ordering, receiving and paying for more than 500,000 phones from Unimax, T-Mobile “exercised its express contractual right to cancel its remaining phone orders,” said the defendant’s motion. Unimax negotiated, agreed to, and signed a contract with T-Mobile “specifically authorizing T-Mobile’s purchase order cancellations,” but it “now claims T-Mobile somehow violated the parties’ contract by exercising that right,” the motion said. “Unimax’s claims are disposed of" by contractual terms it agreed to, it said.

The parties’ contract provides that T-Mobile has the “right, without penalty, additional cost or liability,” to make changes to any purchase order delivered to Unimax, including “without limitation, cancelling” delivery of products ordered from Unimax, the motion said. The contract “expressly provides that T-Mobile has no obligation to pay for products until it has received and accepted them and Unimax has submitted an invoice to T-Mobile for the products,” it said.

Unimax said in its complaint that T-Mobile canceled the POs at issue before it had delivered any of the phones that were the subject of those orders, the motion said. Since the cancellations were authorized by the parties’ contract, Unimax can’t plead a breach of contract claim against T-Mobile, it said.

Unimax’s other causes of action are “derivative of its breach of contract claim and similarly fail to state a claim,” the motion said. T-Mobile’s contractual right to cancel an order “cannot give rise to any implied duty or tort claim contrary to the specific contractual rights Unimax granted to T-Mobile,” it said.

The plaintiff’s claim against T-Mobile for tortious interference with its relationship with its supplier, Great Talent, “is devoid of factual allegations regarding Unimax’s contract or business expectancy with Great Talent, T-Mobile’s knowledge of that relationship, or any improper disruption of that relationship by T-Mobile,” said the motion. Unimax can’t allege wrongful interference for an improper purpose or through an improper means “when T-Mobile merely exercised a contractual right,” it said.

Unimax’s claim for fraudulent or negligent misrepresentation “is merely an effort to reframe its failed breach of contract claim," amounting “to no more than an allegation that T-Mobile represented it would accept delivery of devices it had ordered and later canceled those orders prior to receipt of the products,” the motion said. Unimax “doesn’t plead any facts showing that T-Mobile’s representations were false when made,” and “future promises like T-Mobile’s alleged statement that it would accept delivery of devices from Unimax cannot be actionable misrepresentations” to support the plaintiff’s claims, it said.

Because Unimax’s other causes of action fail to state a claim, it has not established the requisite “substantial controversy” to support its declaratory judgment claim, the motion said. T-Mobile asked the court to dismiss the case in its entirety with prejudice.