HomeMy WebLinkAbout10-0692RITE AID HDQTRS. CORP.
30 Hunter Lane, Camp Hill, PA 17011,
vs.
Plaintiff,
KAY HOME PRODUCTS, INC.
89 McMillen Road,
Antioch, Illinois 60002
Defendants.
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION NO. 10 ?iy?t kem
ACTION FOR DECLARATORY JUDGMENT
Date: January 27, 2010
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ABrian P. Downey (PA 59891)
Frederick Alcaro (PA 91555)
PEPPER HAMILTON LLP
Suite 200, 100 Market Street
P.O. BOX 1181
Harrisburg, PA 17108-1181
Phone: (717) 255-1155
Fax: (717) 238-0575
Email: downeyb@pepperlaw.com
alcarof@pepperlaw.com
Attorneys for Plaintiff
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RITE AID HDQTRS. CORP.
30 Hunter Lane, Camp Hill, PA 17011,
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
Plaintiff,
VS.
CIVIL ACTION NO.
KAY HOME PRODUCTS, INC
89 McMillen Road,
Antioch, Illinois 60002
Defendants.
NOTICE
YOU HAVE BEEN SUED IN COURT. If you wish to defend against the claims set forth in the
following pages, you must take action within twenty (20) days after this Complaint and Notice
are served, by entering a written appearance personally or by attorney and filing in writing with
the Court your defenses or objections to the claims set forth against you. You are warned that if
you fail to do so the case may proceed without you and a judgment may be entered against you
by the Court without further notice for any money claimed in the Complaint or for any other
claim or relief requested by the Plaintiff. You may lose money or property or other rights
important to you.
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT
HAVE A LAWYER, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW. THIS
OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER.
IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE TO
PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER LEGAL
SERVICES TO ELIGIBLE PERSONS AT A REDUCED FEE OR NO FEE.
CUMBERLAND COUNTY BAR ASSOCIATION
32 S. Bedford Street
Carlisle, Pennsylvania 17013
(800) 990-9108
RITE AID HDQTRS. CORP. IN THE COURT OF COMMON PLEAS OF
30 Hunter Lane, Camp Hill, PA 17011,
CUMBERLAND COUNTY, PENNSYLVANIA
Plaintiff,
vs.
KAY HOME PRODUCTS, INC.
89 McMillen Road,
Antioch, Illinois 60002
Defendants.
: CIVIL ACTION NO.
AVISO
USTED HA SIDO DEMANDADO/A EN CORTE. Si usted desea defenderse de las demandas
que se presentan mas adelante en las siguientes paginas, debe tomar acci6n dentro de los
pr6ximos veinte (20) dias despues de la notificaci6n de esta Demanda y Aviso radicando
personalmente o por medio de un abogado una comparecencia escrita y radicando en la Corte por
escrito sus defensas de, y objecciones a, las demandas presentadas aqui en contra suya. Se le
advierte de que si usted falla de tomar acci6n como se describe anteriormente, el caso puede
proceder sin usted y un fallo por cualquier suma de dinero reclamada en la demanda o cualquier
otra reclamaci6n o remedio solicitado por el demandante puede ser dictado en contra suya por la
Corte sin mas aviso adicional. Usted puede perder dinero o propiedad u otros derechos
importantes para usted.
USTED DEBE LLEVAR ESTE DOCUMENTO A SU ABOGADO INMEDIATAMENTE. SI
USTED NO TIENE UN ABOGADO, LLAME O VAYA A LA SIGUIENTE OFICINA. ESTA
OFICINA PUEDE PROVEERLE INFORMACION A CERCA DE COMO CONSEGUIR UN
ABOGADO.
SI USTED NO PUEDE PAGAR POR LOS SERVICIOS DE UN ABOGADO, ES POSIBLE
QUE ESTA OFICINA LE PUEDA PROVEER INFORMACION SOBRE AGENCIAS QUE
OFREZCAN SERVICIOS LEGALES SIN CARGO O BAJO COSTO A PERSONAS QUE
CUALIFICAN.
CUMBERLAND COUNTY BAR ASSOCIATION
32 S. Bedford Street
Carlisle, Pennsylvania 17013
(800) 990-9108
ACTION FOR DECLARATORY JUDGMENT
Plaintiff Rite Aid Hdqtrs. Corp. ("Rite Aid"), by and through its undersigned
counsel, brings this action pursuant to the Declaratory Judgments Act, 42 Pa. C.S.A. § 7531 et
seq. In support of this action, Plaintiff states the following:
PARTIES
1. Rite Aid is a Delaware corporation with its principal place of business at
30 Hunter Lane, Camp Hill, Pennsylvania 17011.
2. Upon information and belief, Defendant Kay Home Products, Inc. ("Kay")
is an Illinois corporation with its principal place of business at 89 McMillen Road, Antioch,
Illinois 60002.
JURISDICTION AND VENUE
3. This Court has subject matter jurisdiction pursuant to 42 Pa.C.S. §931(a).
This Court also has subject matter jurisdiction to grant declaratory relief pursuant to the
Declaratory Judgments Act, 42 Pa. C.S.A. § 7531 et seq.
4. At all times relevant to the conduct alleged in this Complaint, Kay
conducted business in Pennsylvania. Further, Kay has agreed to resolve any disputes related to
the contracts at issue in this Court.
5. Venue in this Court is proper because the cause of action arose in
Cumberland County and a transaction or occurrence took place out of which the cause of action
arose in Cumberland County.
RELEVANT FACTS
6. Rite Aid, through its affiliated companies, operates a national drug store
chain with its principal office in Cumberland County, Pennsylvania.
-1-
7. Kay is a manufacturer of consumer products, including the manufacture of
portable grills and accessories.
8. Among its products, Kay has manufactured products called SummerRite
Grill-It-Kit, the Mini-Quick BBQ Grill-It-Kit, the Premium Grill Aluminum Charcoal Grill
(collectively "Kay Products").
9. Beginning in 2007, Kay sold the Mini-Quick BBQ Grill-It-Kit to Rite Aid
for resale in Rite Aid retail stores. Kay controlled the language on the packaging of the Kay
Products, including any statutory or regulatory information on the packaging if present. In
addition, as the manufacturer of the product, Kay is responsible for the product's packaging, as a
matter of law. Kay is also responsible for obtaining whatever certifications are required for the
product to be legally sold within the state of California.
10. In 2008, Kay sold the Premium Grill Aluminum Charcoal Grill to Rite Aid
for resale in Rite Aid retail stores. Kay controlled the language on the packaging of the Kay
Products, including any statutory or regulatory information on the packaging if present. In
addition, as the manufacturer of the product, Kay is responsible for the product's packaging, as a
matter of law. Kay is also responsible for obtaining whatever certifications are required for the
product to be legally sold within the state of California.
11. In 2009, Kay sold the SummerRite Grill-It-Kit to Rite Aid for resale in
Rite Aid retail stores. Kay controlled the language on the packaging of the Kay Products,
including any statutory or regulatory information on the packaging if present. In addition, as the
manufacturer of the product, Kay is responsible for the product's packaging, as a matter of law.
Kay is also responsible for obtaining whatever certifications are required for the product to be
legally sold within the state of California.
-2-
The Defense and Indemnity Agreement
12. In connection with this arrangement to sell Kay Products, Rite Aid entered
into a Defense and Indemnity Agreement ("Agreement") with Kay on March 20, 2008. A copy
of this agreement is attached hereto as Exhibit A.
13. Kay warranted in the Agreement that the Kay Products provided to Rite
Aid were compliant with the laws in all places where Rite Aid operates. Kay further agreed to
indemnify Rite Aid in connection with any litigation or investigation involving Rite Aid's sale of
Kay Products.
14. Section 1 of the Agreement states as follows:
Compliance with the Law. Seller acknowledges that all Product
provided to Rite Aid is saleable and compliant with all applicable
laws in all jurisdictions where Rite Aid operates.
See Ex.Aat§ 1.
15. Section 2 of the Agreement states as follows:
Defense and Indemnification. Seller shall defend, indemnify and
hold harmless Rite Aid, its shareholders, officers and agents,
affiliated companies, and subsidiaries from any and all losses,
expenses, damages, costs and attorneys fees that they, or any of
them, may at any time from the date hereof incur by reason of
certain claims, actions and/or investigations by the Consumer
Product Safety Commission and/or any other federal state, local or
other governmental entity and also including as well, but not
limited to, claims and/or lawsuits involving allegations by any
person or entity of negligence, personal injury, product liability,
failure to comply with Paragraph 1 above, as well as intellectual
property rights infringement arising out of the sale, purchase,
consumption and/or use of each of the Product sold to Rite Aid.
See Ex. A at § 2.
16. Section 4 of the Agreement provides that, upon reasonable notice of any
investigations, suits or actions instituted against Rite Aid, Rite Aid may select counsel at Kay's
expense to defend it. See Ex. A at § 4.
-3-
17. Section 5 of the Agreement stated that the prevailing party in any
enforcement action related to the Agreement is entitled to recover all of its attorneys' fees and
costs. See Ex. A at § 5.
The Investigation of The California Air Resources Board
18. On September 22, 2009, counsel for Rite Aid received a letter from the
California Air Resources Board ("the Board"). See Letter of R. Hamamoto, a copy of which is
attached hereto as Exhibit B.
19. In that letter, the Board stated that on September 5 and 14, 2009, its
Enforcement Division obtained samples of the SummerRite Grill-It-Kit sold at Rite Aid stores in
Sacramento and Harbor City, California, and on September 15, 2009, it also obtained samples of
the Mini-Quick BBQ Grill-It-Kit and Premium Grill Aluminum Charcoal Grill sold at a Rite Aid
store in Torrance, California. The Board stated that these products were subject to the California
Consumer Products Regulation that requires that all charcoal lighter material products available
for sale in California be certified by the Board. See Ex. B.
20. The Board further stated that according to the Board's Certified Charcoal
Lighter Material Products list, dated August 12, 2009, none of these products were certified and
therefore could not be offered for sale. Id.
21. The Board therefore announced that it was investigating the sale of these
products ("the Board Investigation") and requested materials to support their investigation,
including but not limited to the name of the manufacturer of the products at issue.
22. On December 11, 2009, counsel for Rite Aid responded to the Board's
letter, providing it with all necessary information and naming Kay as the manufacturer of the
products at issue. A copy of this letter is attached hereto as Exhibit C (without exhibits thereto).
-4-
Kay's Refusal to Abide by the Defense and Indemnity Agreements
23. Within days of receiving the September 22, 2009 letter from the Board,
Rite Aid informed Kay of the Board Investigation and sought information necessary to respond
to the Board.
24. Throughout October, November and December 2009, Rite Aid remained
in contact with Kay concerning the Board Investigation.
25. On December 8, 2009, counsel for Rite Aid emailed Chris Young, Vice
President of Kay, seeking information necessary for Rite Aid's response to the Board
Investigation. A copy of this email is attached hereto as Exhibit D.
26. On December 29, 2009, the Board issued a letter to Young, stating similar
facts as in its letter to Rite Aid and seeking further information in support of its investigation. A
copy of this letter is attached hereto as Exhibit E.
27. On January 5, 2010, counsel for Rite Aid emailed Jack Murray, CEO of
Kay, stating that pursuant to the Agreement (Ex. A), Kay has agreed to indemnify Rite Aid in
this situation. A copy of this email is attached hereto as Exhibit F (without attachment thereto).
28. On January 6, 2010, counsel for Rite Aid sent a letter to Murray,
demanding indemnification pursuant to the Agreement, and advising that if Kay refused to honor
its obligation, Rite Aid will pursue its rights under the Agreement through a lawsuit to be filed in
the Court of Common Pleas of Cumberland County, Pennsylvania, as set forth in the Agreement,
including seeking its attorneys fees and costs incurred in bringing that action. Counsel
specifically sought a response to this letter by January 11, 2010. A copy of this letter is attached
hereto as Exhibit G.
29. On January 20, 2010, counsel for Rite Aid sent an email to Murray, stating
that Rite Aid had not received a response to its letter of January 6, 2010 demanding
-5-
indemnification, and that if Kay did not respond to this demand by close of business on January
22, 2010, Rite Aid would be left with no choice but to assume that Kay is refusing to honor its
indemnification obligations and, as a result, will file suit against Kay. A copy of this email is
attached hereto as Exhibit H.
30. To this date, Kay has refused to respond to Rite Aid's request for
indemnification.
31. To this date, Kay has not provided any funds to Rite Aid for the losses,
expenses, damages costs and attorneys' fees it has already incurred in connection with the Board
Investigation.
32. To this date, Kay has continued to refuse to acknowledge its responsibility
to provide indemnification to Rite Aid in connection with any losses, expenses, damages, costs
and attorneys' fees that it will incur in the Board Investigation.
COUNTI
(Declaratory Judgment as to Defendant Kay Home Products, Inc.'s Responsibilities under
the Defense and Indemnity Agreement)
33. Rite Aid incorporates by reference all of the allegations contained in
paragraphs I through 32 as if fully set forth herein.
34. A justiciable controversy between the parties exists with respect to
whether the Defense and Indemnity Agreement obligates Kay to indemnify Rite Aid for all
losses, expenses, damages, costs and attorneys' fees Rite Aid incurs in connection with the
Board Investigation, including but not limited to any fines or citations issued against Rite Aid.
35. As a result of this controversy, a declaratory judgment is both necessary
and proper to set forth the rights and obligations that exist between the parties.
-6-
36. Rite Aid is entitled to recover all of its attorneys' fees and costs associated
with this action.
WHEREFORE, Rite Aid respectfully requests that the Court enter a judgment
declaring that the Defense and Indemnity Agreement obligates Kay to indemnify Rite Aid for all
losses, expenses, damages, costs and attorneys' fees Rite Aid incurs in connection with the
Board Investigation and awarding such other relief as the Court deems just and proper under the
circumstances.
submitted,
Brian P.
derick Ac (PA 9155
P HAMI ON LLP
100 Mar . Suite 2C
Post Office Box-1i81--
Harrisburg, Pennsylvania 17108-1181
(717) 255-1155
(717) 238-0575 (Fax)
downeyb@pepperlaw.com
alcarof@pepperlaw.com
Dated: January 27, 2010 Attorneys for Plaintiff Rite Aid Hdqtrs. Corp.
-7-
VERIFICATION
I, James J. Comitale, hereby state that I am Vice President & Assistant General
Counsel for Rite Aid Hdqtrs. Corp. and am authorized to make this verification on its behalf. I
verify that the statements made in the foregoing Complaint are true and correct to the best of my
knowledge, information and belief.
I understand that the statements in the foregoing document are made subject to the
penalties of 18 Pa. C.S. § 4909 relating to unsworn falsification to authorities.
Dated: January 27, 2009 C- -
i ature
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DEFENSE AND INDEMNITY AGREEMENT
AG EEWN' made this r 4 day of . L"'1? 20? by 64-
A . and Its subsidiaries anther affigated 00011 ss (heroinsfbr
ies arbafW'Rb Aid`).
'Sal and Rite Aid HDOTRS. CORP., and its tlflMated Compan (h
WHEREAS, Rite Aid has purchased, and/or may purchase for resale primarily to
cmmw a, goods, products (including pharmaceutical and O.T.C.} or other items or articles
(hereinafter'Producr) item $egir; and
WHEREAS, Seller has agreed to defend, indemnify and hold harmless Rite Aid of
and from all claims, Immatigations and/or Wwot its arising out If its sales of Product, as
provided herein;
NOW, dwrefore. the pertise hereto agree, for good and valuable consideration, and
intending to be isgafly bound, as follows:
1. Canallanae with t? L?r. Seller acknowledges that all Product provided to Rite
Aid is saleable and compliant with sit appAcabls' laws In all Jurisdictions where Rite Aid
operates.
2. Seller shall dsfertd, rode" and hold harmless
Rite Aid, ks -shareholders, officers and agent, -Mb t-d oomnpaniss, and subsidiaries from
any and all leamw expensed, darnapes, comb and attome fan that they, or any of them,
may at any time from the dots hereof Incur by meson of certain claims, amiss and/or
instigations by ft CWngxndr Product Slaty Comnnistion and/or any other federal. state,
local or other gavemmenlai entity and dap kfto ing as vied, but not knitted to. Cairns andlo?
lawwits InvotvkV alegOlons by any potion or only of nsgkpenoe, personal k", product
lablty, faliure to comply with Paragraph 1 above, as well as intellectual property rights
infringemerxt artsing out of the sale, purchase, cormmV ion and/or use of each of the
Product sold to Rite Aid.
S, Inomma Without limiting any of Seller's obkgatlons or liabilities hereunder, Seller
further agrees to procure and mainUM at SOWs sole cost and expense Comprehensive
General Liabkdly insurance kl4duding product •IiibOy insurance, with krrnks of gabikty of not
k" than $5.0 mllior?. Sold pokey of in suranoe stallname Ripe Aid as an additional insured
ar Seller's expense. A duly wee cutsd cwtKo to of insurance. shad be delivered to Ric Aid
**in fifteen (15) days of the execution of this Agresmert and renewal thereof shall be
delivered at least thirty (30) drys prior to the expiration olthe poker term.
4. Imo. Rite Aid will give the Seller reesorabio- odoe of any investigations,
suits or action instituted against Rte Aid. Rite Aid will coopers te with the Seiler in
COIN xectbtx wilt the dalki se or ssitlbment of such edion. Rile Aid shop soon ct and retain
counsel at Seller's expense to defend Rite Aid in any such action.
5. MMM. This Agreernent shall survive and be binding upon alai shag inure to the
benefits of the parties. their legal ropy mtotives, successors and assigns. The prevailing
porty in any snforoemerd action rotated to No Agrearnent Is entitled to recover ON of its
attorneys' fees and costs.
o.....r.+s.. MM
IL Em, Claus., AMMSkllM CambinmAL This IndermOkstim AWmnent
nweaanla-IM sid unddrsiandlrg between the parties raged ft ttre subjW rust harsot,
suPWVGOV aM Prior understandngs, oral or In writ. This Indmwoloation Agnemarn ma
not be dWWd, amended or modUfad except by an Aoreemerit in wri ft, *WW by all
Par Um harsMo. This Apmwm t may be =svAed In ant or men oOUrNerp k, and by the
Parties hersbo In separate oourderpdrb, asell of which AM be daempd to be an orfptnal but
RA of which taken together shalt constitute one end the same Agrsament.
7. This AWsm"erit shat be governed by and construed In
accordaroe wAlh the hwe of the C onarwsab of Peranyivanta without r%Wd to its
conflicts of law rules and princk*s. Any dlspuMe(s) ~ to this Apra nv" " be
venued exduaively In the Court of Conbr= Pleas for Cumberland County, Permytvania.
a 4 c RITE AID HDOTRS. CORP.
By-
DI??dYYr)M.N?
? k,4 11
Air Resources Board
Mary D. Nichols, Chairman
Unds 8. Arians 10011 Str" • P.O. Box 2815 Arnold 8cfrrrar gar
Seca piw lbr Sacramento, Caftmis 95812 • www.srb.ce.gov covemor
Emi onmental Pmteckv
September 22, 2009
Mr. James M. Mattesich, Esq.
Greenberg Traurig, LLP
1201 K Street, Suite 1100
Sacramento, California 95814
Dear Mr. Mattesich:
On September 5 and 14, 2009, Enforcement Division staff obtained samples of
SummerRite Grill-If-Klt product (item # 9004578--MMIX) from Rite Aid stores in
Sacramento and Harbor City, California. These products include charcoal briquettes
and the label instructs consumers to light the bag of charcoal in order to ignite the
charcoal. The products do not identify the manufacturer, but packaging indicates they
are distributed by Rite Aid Corporation. We examined these product containers and
none of the products were marked with a date of manufacture.
On September 15, 2009, staff obtained a sample of the Mini-Quick BBQ G411-It-Kit
product (item # 301547DI) and a sample of the Premium Grill Aluminum Charcoal Grill
product (item # 9001199-MMVIII) from the Rite Aid store in Torrance, California. The
Mini-Quick BBQ Grill-It-Kit product includes instant light charcoal briquettes with
accelerant and appears to be marked with a date of manufacture of 2019/2008. The
Mini-Quick BBQ Grill-It--Kit was manufactured by Kay Home Products. The Premium
Grill Aluminum Charcoal Grill product includes easy to light charcoal briquettes and was
marked with a date of manufacture of 09/1712007. The Premium Grill Aluminum
Charcoal Grill does not identify the manufacturer, but the packaging indicates it was
distributed by Rite Aid Corporation.
The California Consumer Products Regulation requires that all charcoal lighter material
products available for sale in California be c ertifled by the Air Resources Board (ARB).
When ARB certifies a charcoal lighter material product, the manufacturer is issued an
Executive Order. rCharcoal Lighter Material" means any combustible material designed
to be applied on, incorporated in, added to, or used with charcoal to enhance ignition.
"Charcoal Lighter Material" does not include any of the following: (A) electrical starters
and probes, (B) metallic cylinders using paper tinder, (C) natural gas, (D) propane, and
(E) fat wood. Based upon the labels, the SummerRite Gdll-# 40t, the Mini-Quick BBQ
Grill It Kit, and the Ptemimn Grill Aluminum Charcoal Grill products have been
determined to be subject to the certification requirements as a `Charcoal Lighter
nm energy chaftW lrvft CaWwVa Js mael,. Every Caffar*n needs ro &Wo Iosrw&* w&w b rsducs wwW cmmmW&n.
Fora Wcf&WPAV ww you can m&m dwrwrd and cut your energy ovepr, no our wsbo7rs: hMJMww.wb.ea.gft.
California Environmental Protection Agency
Mr. James M. Mattesich, Esq.
September 22, 2009
Page 2
Material." According to ARS's Certified Charcoal Lighter Material Products list dated
August 12, 2009, none of these products have been certified and cannot be offered for
sale in Cafrfomia.
As part of our investigation, we are requesting the following:
1. Copies of all California sales records for each product for the past three
(rears.
2. Provide an explanation as to why these products were not properly certified.
3. Provide an explanation as to why the SummerR#e GrIfl-R--Kif products (item 0
9004578-MMIX) were not marked with a date of manufacture.
4. If Rite Aid Corporation is not the manufacturer of this product, please identity
the manufacturer, contact . person, and address for this product.
Kindly submit the requested information by October 8, 2008. Should I not hear from you
or you do not respond by October 8, 2009,1 will recommend that a Notice of Violation
be issued. If you have any questions or concerns regarding our preliminary findings,
please contact me at (916) 324-6972 or by email at rhamamotiMarb.ca.oov. I look
forward to hearing from you shortly.
Sincerely,
?ca? ?k•-o??c
Robert Hamamoto, Air Pollution Specialist
Consumer Products Enforcement Section
cc: Mr. Ron Chima
Rifle Aid Corporation
30 Hunter Lane
Camp Hill, Pennsylvania 17011
.b? ?
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NGreenbergTraurig
JAMES M. MATM&CH
TEL: (016) 442-1111
FAX: (516) 448-1705
MATTESICHJ@GnAWCOM
December 11, 2009
For Settlement Discussion Purposes Only -
Not Admissible Per Evidence Code § 1152
Contains Conflilential Trade Secrets
VIA E MALL AND REGULAR MAIL
Mr. Steve Giorgi
Manager, Consumer Products Enforcement Section
California Air Resources Board ;.;
P.O. Box 2815 "I
10011 Street, 5s' Floor
Sacramento, CA 95812
!"M If 1'
.: IIl
Re: CARB's allegations that Rite Aid sold charcoal lighter fluid that had not
been previously certified by CARB
Dear Steve:
W rl :`. I)FI
This responds to the California Air Resources Board's ("CARE') September 22, 2009 letter ,.,,
regarding three alleged "charcoal lighter material" products CARD allegedly purchased from „ ,r I•
Rite Aid. The products identified were: (1) Su nmerRite Grill-It-Kit (Item No. 9004578- „. Ar,r;111 t.
MMIX); (2) Mini-Quick BBQ. Grill-It-Kit (Item No. 301547D1);' and (3) Premium Aluminum hAIAM,
Charcoal Grill (Item No. 9001199-MMVID).
r II 1'Y 11 i"d 1
In its letter, CARB requested that Rite Aid provide it with: (1) "copies of all California sales w' i ikl.
records for each product for the past three years;" (2) "an explanation as to why these products 1 WAN,.i . 1
were not properly certified;" (3) "an explanation as to why the SwnmerRite Grill-It-Kit 411 Al 41
product (item # 9004578-MMIX) was not marked with a date of manufacture;" and (4) the :,1 NI1
identify of the manufacturer of each of the three products, along with the manufacturer's V1 Ili AI 41 I'I IV,
contact information. I'I1 ,11.41!
•.1 .Ill',Ai I(Axll I!I( I
.I Al' 4,1 IAI
Althougb CARE identifies this item by No. 301547DI, Rite Aid's numerical designation for this item, which is AI I Al .A'; l l
reflected in the attached sales records, is Item No. 943403.
I , ., ,ra. . qmp u
WAY IllI:,I -111 I:,
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VII k 'drvet - til.ulr 1100 - Sa% ranwrito. C A 958P, MH ¦ Id 4164.V [III - I ax 91(,448.1709 1
Steve Giorgi, CARB
December 11, 2009
Page 2
As you might expect, Rite Aid did not manufacture these products. Rite Aid purchased them
from a supplier, Kay Home Products. We have attempted to obtain the necessary information
from Kay Home Products. Only yesterday, December 10, 2009, did Kay finally respond to us.
We will thus need to supplement this letter as further information becomes available. We are
able to provide the following information at this time.
Manufachmn
All three of the above products are manufactured by KaY Home Products. Kay Home
products can be reached at 90 McMillen Road, Antioch, Illinois 60002.
Rite Aid's DUrchase and We of the three products in guestiont
The SummerRite Grill-It-Kit product was a seasonal product purchased solely for the 2009
baf*ue season. Rite Aid no longer purchases this product, and has made the decision not to
purchase any of the product in the future, or offer it for sale. Because this product was only
purchased for the 2009 barbeque season, any sales of the product that occurred after the 2009
barbeque season were the result of left over merchandise, not new purchases of the product by
Rite Aid.
The Premium Aluminum Charcoal Grill product was also a seasonal product purchased solely
for the 2008 barbeque season. Rite Aid no longer purchased this product after the 2008
barbeque season, and has made the decision not to purchase any of the product in the future, or
offer it for sale. Because this product was only purchased for the 2008 barbeque season,. any
sales of the product that occurred after the 2008 barbeque season were the result of left over
merchandise, not new purchases of the product by Rite Aid.
Unlike the first two products, the Mini-Quick BBQ Grill-It-Kit product was not a seasonal
product, and was therefore maintained on a year round basis in a special "barbeque" section of
certain stores. The product was not offered for sale in all stores, but only a select few. Rite
Aid has decided to no longer purchase this product or offer it for sale in California.
Rite Aid no longer carries any-products manufactured by Kay Home Products.
For Seakment Discussion Purposes Only -
Not Admissible Per Evidence Code § 1152
Contains ConJldendal Trade Secrets
GRLENURG IRALIRIG. LLP ¦ Al IORNEYS AT LAW ¦ WWW.CTLAW.COM
Steve Giorgi, CARB
December 11, 2009
Page 3
oned
Sales data related to the three aforementi
Rite Aid is providing sales records for the three products in question. They are attached to this
letter as Exhibit "A." The sales records reflect the fact that Rite Aid only sold the three
products for very short periods of time,
Rite Aid began selling the SummerRite Grill-It-Kit product (Item No. 9004578) in March
2009. The sales data indicates that, since that time, Rite Aid has sold. 8,652 units of the
product.
Rite Aid began selling the Premium Aluminum Charcoal Grill product (Item No. 9001199) in
February 2008. The sales data indicates that, since that time, Rite Aid has sold 6,372 units of
the product.
Rite Aid began selling the Mini-Quick.BBQ Grill-It-Kit product (Item No. 943403) in March
2007. The sales data indicates that, since that time, Rite Aid has sold 1,337 units of the
product.
Recalls and removal from California stores:
Since receiving notice of suspected violations from CARB, Rite Aid has issued recalls and
taken other steps to remove the three products in question from California stores. Rite Aid
issued recalls on September 27, 2009, and October 4, 2009. Rite Aid's first recall was sent
five days after September 22 2009, the date CARB first sent notice of suspected violation to
outside counsel for Rite Aid Rite Aid's second recall was sent seven days after that.
In addition, as noted above, Rite Aid has ended its relationship with Kay Home Products and,
as a result, is no longer purchasing the three products from this manufacturer.
Certification and date of manufacture:
We have been trying to speak to the manufacturer to determine: (1) whether the products in
question are in fact "charcoal lighter material" products as that term is defined in Cal. Code
s September 22, 2009 is the date of CARB's letter of suspected violation, it is not necessarily the date Rite Aid or
its outside counsel received the Letter. Therefore, it is likely that Rite Aid issued its first recall less than five days
after first receiving suspected notice of viohition from GARB.
For Settlenent Discussion Purposes Only -
Not Admissible Per Evidence Code # 1152
Contains Cagrdential Trade Secrets
GRLL NBLRG TRAURIG. LIT ¦ Al' I ORNEYS AT LAW • W W W.GTI.AW.COM
Steve Giorgi, CARB
December 11, 2009
Page 4
Regs., tit. 17, § 94508(a)(27);' (2) whether the products were certified for sale in California;
(3) if the products were not. certified for sale in California, why no certification was obtained;
(4) whether the products omit volatile organic compounds ("VOC'j in excess of the limits
prescribed by 17 CCR § 94509; (5) whether the SummerRite Grill-It-Kit product was marked
with a date of manufacture; and (6) if the SummerRite Grill-It-Kit product was not marked
with a date of manufacture, why not?
As stated above, despite our several outreach efforts, it took until yesterday before anyone
from Kay Home Products responded to us. Thus, we have had less than one business day to
explore with Kay Home Products the issues raised by your letter. As a result, at this time, Rite
Aid is unable to provide information in response to the six issues listed above. However, once
it has had an opportunity to adequately explore these issues with Kay Home Products, Rite
Aid will supplement this letter with whatever additional information it is able to obtain.
At this point, we note that CARB's concerns have so far been limited to the three
aforementioned products' alleged .lack of certification and, with respect to one of the products
only, an alleged failure to include the date of manufacture on the product's packaging. Your
letter does not indicate whether you believe that any of the three products emit excessive VOC
or are noncompliant with the SCAQMD Rule 1174 testing protocol. If you have tested these
products for VQC compliance, we would appreciate a copy of the test results. Similarly, if
you have any other information suggesting that the three aforementioned products emit
excessive VOCs or are somehow noncompliant with the SCAQMD Rule 1174 testing
protocol, we would appreciate being provided with that information.
If you or your staff have any questions about the contents of this letter, please feel free to call
me or Ray Sardo at (916) 442-1111.
Sincerely,
S MATTESICH
Enclosure
cc: Ray Sardo
' For the sake of convenience, all further references to title 17 of the California Code of Regulations will be in the
fb m "17 CCR § "
For Settlan ent Discussion Purposes Only -
Not Admiissible Per Evidence Code § 1152
Contains Confidential Trade Secrets
GREENBERG TRAURIG, LLP • ATTORNFYS AT LAW ¦ WWW.GTLAW.COM
ych.?J
Page 2 of 2
From: Sardo, Ray (Assoc-Sac-LT)
Sent: Tuesday, December 08, 2009 10:46 AM
To: cyoung@kayhomeproducts.com
Cc: Mattesich, James (Shld-Sac-GovAffairs); dshaffer@riteaid.com
Subject: Charcoal lighter products sold to Rite Aid
Chris,
I got your email address from Derrick Shaffer, who is a category manager at Rite Aid. I am defending Rite Aid
against an enforcement action brought by the California Air Resources Board ("CARE") for Rite Aid's alleged sale
of three products manufactured by your company: (1) SummerRite Grill-It-Kit; (2) Mini-Quick BBQ Grill-It-Kit; and
(3) Premium Grill Aluminum Charcoal Grill.
As you are likely aware, under California's consumer product regulations, no charcoal lighter material may be sold
within the state unless: (1) the manufacturer of the product has obtained a certification from CARB; and (2) the
volatile organic compound ("VOC") emissions from the ignition of the charcoal lighter material is less than or equal
to .020 pound of VOC per start, as set forth in the South Coast Air Quality Management District Rule 1174 Ignition
Method Compliance Certification Protocol.
CARB is alleging that it never certified the three products identified above. However, I have seen documentation
suggesting this product may have been certified by the South Coast Air Quality Management District. I would like
to talk to you as soon as possible to discuss whether these products were certified in California, and whether they
meet the VOC limit set forth above.
I can be reached at 916-442-1111 or by reply email.
Thank you,
Ray Sardo
Raimondo A. Sardo
Associate
Greenberg Traurig, LLP 1 1201 K Street, Suite 1100 1 Sacramento, CA 95814
Tel 916.442.1111 1 Fax 916.448.1709
sardor@g.tlaw.com I www.gtlaw.com
EGreenbergTraurig
USA LAW FIRM OF THE YEAR, CHAMBERS GLOBAL AWARDS 2007
ALBANY AMSTERDAM • ATLANTA AUSTIN • BOSTON • CHICAGO • DALLAS • DELAWARE • DENVER • FORT LAUDERDALE - HOUSTON - LAS VEGAS
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PLEASE CONSIDER THE ENVIRONMENT BEFORE PRINTING THIS EMAIL
1/21/2010
AL"I
ALL-STATE® LEGAL 800-222-0510 ED11 RECYCLED
1%7)c
jj Air Resources Board }...
Mary D. Nichols, Chairman
Linda S. Adams 1001 1 Street • P.O. Box 2815 Arnold Schwarzenegger
Secretary for Sacramento, California $5812 - www.arb.ca.gov Governor
Environmental Protection
December 29, 2009
Mr. Chris Young, Vice President
Kay Home Products
89 McMillen Road
Antioch, Illinois 60002
Dear Mr. Young:
On September 5 and 14, 2009, Enforcement Division staff obtained samples of the
SummerRite Grill--It-Kit product (Rem # 9004578-MM'IX) from the Rite Aid stores in
Sacramento and Harbor City, California. These products claim to include light the bag
charcoal briquettes and to be distributed by Rite Aid Corp. - We examined these product
containers and none of the products were marked with a date of manufacture.
Then on September 15, 2009, staff obtained a sample of the Mini-Quick BBQ Grill-It-Kit
product (item # 301547DI) and a sample of the Premium Grill Aluminum Charcoal Grill
product (item # 9001199-MMVIII) from the Rite Aid store in Torrance, California. The
Mini-Quick BBQ Grill-It-Kit product includes instant light charcoal briquettes with
accelerant and marked with a date of manufacture of 2019/2008. This product was
manufactured by Kay Home Products. The Premium Grill Aluminum Charcoal Grill
product includes easy to light charcoal briquettes and was marked with a date of
manufacture of 09/17/2007. This product states being distributed by Rite Aid Corp. The
attorney representing Rite Aid has identified that your company is the supplier and the
manufacturer of these products.
The California Consumer Products Regulation requires that all charcoal lighter material
products available for sale in California be certified by the Air Resources Board (ARB).
When ARB certifies a charcoal lighter material product, the manufacturer is issued an
Executive Order. "Charcoal Lighter Material" means any combustible material designed
to be applied on, incorporated in, added to, or used with charcoal to enhance ignition.
"Charcoal Lighter Material" does not include any of the following: (a) electrical starters
and probes, (b) metallic cylinders using paper tinder, (c) natural gas, (d) propane, and
(e) fat woad. Based upon the labels, the SummerRite Grill-It-Kit, the Mini-Quick BBQ
Grill-it-Kit, and the Premium Grill Aluminum Charcoal Grill products have been
determined to be subject to the certification requirements as a "Charcoal Lighter
Material." Accordiing to ARB's Certified Charcoal Lighter Material Products list, none of
these products have been certified and cannot be offered for sale in California.
The energy challenge facing California is real. Every Calabmw needs to take immediate action to reduce energy consumption.
For a list of &WW& ways you can reduce demand and cut your energy costs, we our website: htto./lwww.arb.ca, aov.
California Environmental Protection Agency
Printed on Recycled Paper
Mr. Chris Young
December 29, 2009
Page 2
As part of our investigation, we are requesting the following:
1. Copies of all California sales records for each product and any other similar
products marketed (under different brand names for the past three years.
2. Provide an explanation as to why these products were not properly certified.
3. Provide an explanation as to why the SummerRite Grill-It-Kit products (item #
9004578-MMIX) were not marked with a date of manufacture.
4. Identify the combustible material designed to be applied on, incorporated in,
added to, or used ,--W+h charcoal to enhance ignition.
Kintly submit the requested information by January 14, 2010. Should I not hear from
yow or you do not respond by January 14, 2010,1 will recommend that a Notice of
Violation be issued. If you have any questions or concerns regarding our preliminary
findings, please contact me at (916) 324-6972 or by email at rhamamotftarb.ca.aov.
look forward to hearing from you shortly.
Sincerely,
Robert Hamamoto, Air Pollution Specialist
Consumer Products Enforcement Section
cc: Mr. James M. Mattesich
Greenberg Traurig, LLP
1201 K Street, Suite 1100
Sacramento, California 95814
l h 1 '.4
Page 1 of 3
Alcaro, Frederick
From: SardoR@gtlaw.com
Sent: Tuesday, January 05, 2010 7:37 PM
To: JMurray@kayhomeproducts.com
Subject: RE: California's enforcement action against Rite Aid and Kay Home Products
Attachments: 441589306_v_1_Kay Indemnification Agreement.PDF
Jack,
Thank you for your email. Since we last spoke, I have been able to get in touch with the right people at Rite Aid,
and I've learned, as you will see from the attached, that Kay Home Products has agreed to indemnify Rite Aid in
this situation. It is our hope that we will be able to work cooperatively pursuant to that agreement. In order to
defend Rite Aid (and, by extension, Kay Home Products), we really need to finalize a declaration from you stating
that all the products were certified. It is clear from CARB's letter that CARB is also pursuing Kay for the sale of
these products. At this point, we need to coordinate our efforts, or Kay could be responsible for two separate
penalties -- its own, and Rite Aid's (via the indemnification).
With respect to the labeling issue (i.e., no date of manufacture), based on our experience, CARB takes the
position that it is the manufacturer's responsibility to include a date of manufacture on each product it makes. In
fact, section 94512 of title 17 of the California Code of Regulations provides that "Each manufacturer of a
consumer product subject to Section 94509 shall clearly display on each consumer product container or package
the day, month, and year on which the product was manufactured, or a code indicating such," and "No person
shall erase, alter, deface, or otherwise remove or make illegible any date or code indicating the date of
manufacture from any regulated product container without the express authorization of the manufacturer." Rite
Aid has informed me that it never told Kay not to include a date of manufacture on the product packaging. If you
have some communication from Rite Aid to the contrary, I would be happy to review it. Whether true or not, it is
no defense to tell CARB "Rite Aid told us to label it this way." As for the product certifications, all products
manufactured by Kay which are sold in California have to be certified. This is true regardless of whether they are
sold by Rite Aid or some other retailer. By law, the responsibility for certification lies with the manufacturer.
Please give me a call so we can discuss this further.
Thanks,
Ray Sardo
From: Jack Murray (mailto:JMurray@kayhomeproducts.com]
Sent: Tuesday, January 05, 2010 3:57 PM
To: Sardo, Ray (Assoc-Sac-LT)
Subject: RE: California's enforcement action against Rite Aid and Kay Home Products
Ray,
The letter you reference from the California Air Resources Board ("CARE"), with a cc to James M. Mattesich, is
what your voice mail told me to expect. This same voice mail, which followed our original conversation, has
apparently resulted from you decision "to report" Kay Home Products as the manufacturer.
A later voice mail, during the week of December 21, which came after I made several unanswered calls to you,
suggested that you were going to deal with the indemnification issue, but that certain people were unavailable.
As you know from my speaking with you the labeling and testing done on this product was based on specification
ordered by Rite Aid.
We are happy to discuss this further, but would appreciate the opportunity to understand that Rite Aid is the
responsible party.
1/21/2010
Page 2 of 3
Finally, by way of information, Chris Young is not involved in dealing with this situation.
Thanks!
Jack
From: SardoR@gtlaw.com [mai Ito: SardoR@gtlaw.com]
Sent: Tuesday, January 05, 2010 5:19 PM
To: Jack Murray
Cc: Chris Young
Subject: California's enforcement action against Rite Aid and Kay Home Products
Jack,
I realized I didn't add a subject line to this email yesterday, so I am resending to make sure you didn't overlook it.
I am also cc'ing Chris Young. Please give me a call so we can discuss.
From: SardoR@gtlaw.com [mailto:SardoR@gtlaw.com]
Sent: Monday, January 04, 2010 3:40 PM
To: jmurray@kayhomeproducts.com
Subject:
Hi Jack, and happy new year.
We received a copy of the attached letter over the holidays. It is from the California Air Resources Board
("CARB") and is addressed to Chris Young of your company. I am not sure whether you have seen it yet.
The attached letter further convinces us that we will need your declaration in order to fend off further action from
CARB. CARB appears to have expanded its investigation to include Kay Home Products, and is now demanding
information from Kay Home Products, in addition to the information it already demanded from Rite Aid. The
declaration we prepared for you addresses the issues raised by CARB, and will assist us in resolving this matter.
Please call me at 916-442-1111 so that we can discuss this matter in further detail, and how to finalize your
declaration. Alternatively, I would be happy to call you at a prearranged time, if you can let me know your
availability. This might make more sense given the difficulties we have experienced in reaching one another over
the phone.
Thank you,
Ray Sardo
Raimondo A. Sardo
Associate
Greenberg Traurig, LLP 1 1201 K Street, Suite 1100 I Sacramento, CA 95814
Te1916.442.1111 1 Fax 916.448.1709
sard.or.@-gtt4W.com I wWw_gtlaw com
NGreenberkTraung
USA LAW FIRM OF THE YEAR, CHAMBERS GLOBAL AWARDS 2007
ALBANY AMSTERDAM • ATLANTA AUSTIN • BOSTON • CHICAGO - DALLAS • DELAWARE • DENVER FORT LAUDERDALE HOUSTON LASVEGAS
LONDON' LOS ANGELES MIAMI NEW JERSEY • NEW YORK • ORANGE COUNTY - ORLANDO • PALM BEACH COUNTY • PHILADELPHIA PHOENIX
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'OPERATES AS GREENBERG TRAURIG MAHER LLP
PLEASE CONSIDER THE ENVIRONMENT BEFORE PRINTING THIS EMAIL
Tax Advice Disclosure: To ensure compliance with requirements imposed by the IRS under Circular 230, we
1/21/2010
Page 3 of 3
inform you that any U.S. federal tax advice contained in this communication (including any attachments), unless
otherwise specifically stated, was not intended or written to be used, and cannot be used, for the purpose of (1)
avoiding penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another
party any matters addressed herein.
The information contained in this transmission may contain privileged and confidential information. It is
intended only for the use of the person(s) named above. If you are not the intended recipient, you are hereby
notified that any review, dissemination, distribution or duplication of this communication is strictly prohibited. If
you are not the intended recipient, please contact the sender by reply email and destroy all copies of the original
message. To reply to our email administrator directly, please send an email to postmastefttl.aw com.
1/21/2010
.? ? ?
? x?,, .
MGreenbergTraurig
Ray A. Sardo
(9t6) 442-1111 Telephone
(916) 448-1709 Facsimile
Sard0R@gt13W.c0m
January 6, 2010
Via FedEx
Jack Murray, CEO
Kay Home Products
90 McMillen Road
Antioch, Illinois 60002
Re: California Air Resources Board's Enforcement Action Against Rite Aid
and Kay Home Products Pertaining to Sale of Charcoal Lighter
Materials
Dear Jack:
I am sending this letter in follow-up to the e-mail 1 sent to you earlier today. I have spoken
with Rite Aid about your previous correspondence, and confirmed that Rite Aid will not be
indemnifying Kay Home Products ("Kay"). My office has substantial experience with the
regulations at issue. Based on that experience, and the indemnification agreement your
company executed with Rite Aid, it is clear that Kay is the responsible party in this matter,
and that the indemnification agreement is valid and enforceable. If Kay refuses to honor its
indemnity agreement, Rite Aid intends to sue Kay to enforce its common law and
contractual defense and indemnity rights. Note that Paragraph 5 of the indemnification
agreement entitles Rite Aid to its attorneys' fees and costs if it is forced to sue Kay to
enforce the agreement. Be advised that Rite Aid will pursue all such fees and costs if Kay
continues to refuse to honor the agreement, and a lawsuit becomes necessary. This lawsuit
will be filed in the Court of Common Pleas in Cumberland County, Pennsylvania as Kay
agreed in the defense and indemnity agreement. Rite Aid will seek complete reimbursement
of its fees and costs related to the CARB investigation as well as the lawsuit to enforce its
defense and indemnity rights.
That being said, I remain optimistic that we can work together to deter the enforcement
action currently pending against both Kay and Rite Aid. I continue to believe it is in both
Rite Aid's and. Kay's best interests to complete the declaration process, and coordinate our
communications with CARB. Also, it may very well be in Kay's best interest to consult an
attorney that has experience with the regulations at issue and how they relate to Kay's
products that are at issue. I believe you will hear confirmation that compliance with the
applicable regulations is Kay's responsibility, and not Rite Aid's.
ass s= 1z w, G s ...v,Nw.cr;_aW 43y
12-11 < ?treee * Suite 15F)0 Sac-amen'o. CA 95614-3938 • 'rel 915.4421F r Fax 976.1148'71C9
Jack Murray
January 6, 2010
Page 2 of 2
Please feel free to call me if you have any questions regarding this letter. I would appreciate
a response to the indemnification question by the close of business on Monday, January 11,
2010. However, I am hopeful we can speak before then to finalize your declaration.
Sincerely,
?a'? &t'- 3
Ray A. Sardo
GREENBERG T RAURIG LP a ATTORNEYS AT LAW ¦ WWW,GTLAW.COM
i ??'?
Page 1 of 4
Alcaro, Frederick
From: SardoR@gtlaw.com
Sent: Wednesday, January 20, 2010 2:25 PM
To: JMurray@kayhomeproducts.com
Subject: FW: California's enforcement action against Rite Aid and Kay Home Products
Jack,
I am sending you this email in follow up to the voicemail I just left you, and the letter and email I sent you on
January 6, 2010. The email appears below. In my January 6, 2010 letter and email, I informed you that,
unless Kay Home Products ("Kay") agreed to honor its indemnification agreement with Rite Aid, Rite Aid would
sue Kay to enforce its contractual indemnification rights in Cumberland County, Pennsylvania. I requested a
response to my letter and email by close of business on January 11, 2010. It is now January 20, 2010, and Kay
has still not provided any response to Rite Aid's indemnification demand. If Kay does not respond to Rite Aid's
indemnification demand by close of business on Friday, January 22, 2010, Rite Aid will be left with no choice but
to assume that Kay is refusing to honor its indemnification obligations and, as a result, will file the
aforementioned lawsuit against Kay.
I continue to remain optimistic that we can work together to defend the enforcement action currently pending
against Kay and Rite Aid. However, Rite Aid needs some indication of how Kay intends to proceed by close of
business on Friday. If no such response is provided, Rite Aid will file a lawsuit seeking complete reimbursement
of its fees and costs related to the CARB investigation, as well as the attorneys' fees it is forced to incur as a
result of Kay's refusal to honor its indemnification obligations.
Please feel free to call me if you have any questions regarding the above. My phone number is 916-442-1111
Sincerely,
Ray Sardo
From: Sardo, Ray (Assoc-Sac-LT)
Sent: Wednesday, January 06, 2010 3:07 PM
To: Jack Murray
Subject: RE: California's enforcement action against Rite Aid and Kay Home Products
Jack,
I spoke with Rite Aid about your previous correspondence, and confirmed that Rite Aid will not be indemnifying
Kay Home Products ("Kay"). My office has substantial experience with the regulations at issue. Based on that
experience, and the indemnification agreement your company executed with Rite Aid, it is clear that Kay is the
responsible party in this matter, and that the indemnification agreement is valid and enforceable. If Kay refuses to
honor its indemnity agreement, Rite Aid intends to sue Kay to enforce its common law and contractual defense
and indemnity rights. Note that Paragraph 5 of the indemnification agreement entitles Rite Aid to its attorneys'
fees and costs if it is forced to sue Kay to enforce the agreement. Be advised that Rite Aid will pursue all such
fees and costs if Kay continues to refuse to honor the agreement, and a lawsuit becomes necessary. This lawsuit
will be filed in the Court of Common Pleas in Cumberland County, Pennsylvania as Kay agreed in the defense
and indemnity agreement. Rite Aid will seek complete reimbursement of its fees and costs related to the CARB
investigation as well as the lawsuit to enforce its defense and indemnity rights.
That being said, I remain optimistic that we can work together to deter the enforcement action currently pending
against both Kay and Rite Aid. I continue to believe it is in both Rite Aid's and Kay's best interests to complete
the declaration process, and coordinate our communications with CARB. Also, it may very well be in Kay's best
interest to consult an attorney that has experience with the regulations at issue and how they relate to Kay's
products that are at issue. I believe you will hear confirmation that compliance with the applicable regulations is
Kay's responsibility, and not Rite Aid's.
1/21/2010
Page 2 of 4
Please feel free to call me if you have any questions regarding this email. I would appreciate a response to the
indemnification question by the close of business on Monday, January 11, 2010. However, I am hopeful we can
speak before then to finalize your declaration. I am sending a similar message to you by federal express.
Sincerely,
Ray Sardo
From: Jack Murray [mailto:]Murray@kayhomeproducts.com]
Sent: Tuesday, January 05, 2010 5:13 PM
To: Sardo, Ray (Assoc-Sac-LT)
Subject: RE: California's enforcement action against Rite Aid and Kay Home Products
Ray,
Thanks for the note.
You are the lawyer, and I take from your letter and the attachment that you are somehow offering an opinion, that
under Pennsylvania law, we have indemnified Rite Aid for the issue at hand.
I respectfully disagree. I am far more comfortable with some but not all of your observations regarding CARB.
At this point, we would like Rite Aid, who is the responsible party, for the product in question, to confirm this to us
in writing. Following receipt of this specific indemnification, we will be in a position to move forward together, as
you have proposed.
Jack
From: SardoR@gtlaw.com [mailto:SardoR@gtlaw.com]
Sent: Tuesday, January 05, 2010 6:37 PM
To: Jack Murray
Subject: RE: California's enforcement action against Rite Aid and Kay Home Products
Jack,
Thank you for your email. Since we last spoke, I have been able to get in touch with the right people at Rite Aid,
and I've learned, as you will see from the attached, that Kay Home Products has agreed to indemnify Rite Aid in
this situation. It is our hope that we will be able to work cooperatively pursuant to that agreement. In order to
defend Rite Aid (and, by extension, Kay Home Products), we really need to finalize a declaration from you stating
that all the products were certified. It is clear from CARB's letter that CARB is also pursuing Kay for the sale of
these products. At this point, we need to coordinate our efforts, or Kay could be responsible for two separate
penalties -- its own, and Rite Aid's (via the indemnification).
With respect to the labeling issue (i.e., no date of manufacture), based on our experience, CARB takes the
position that it is the manufacturer's responsibility to include a date of manufacture on each product it makes. In
fact, section 94512 of title 17 of the California Code of Regulations provides that "Each manufacturer of a
consumer product subject to Section 94509 shall clearly display on each consumer product container or package,
the day, month, and year on which the product was manufactured, or a code indicating such," and "No person
shall erase, alter, deface, or otherwise remove or make illegible any date or code indicating the date of
manufacture from any regulated product container without the express authorization of the manufacturer." Rite
Aid has informed me that it never told Kay not to include a date of manufacture on the product packaging. If you
have some communication from Rite Aid to the contrary, I would be happy to review it. Whether true or not, it is
no defense to tell CARB "Rite Aid told us to label it this way." As for the product certifications, all products
manufactured by Kay which are sold in California have to be certified. This is true regardless of whether they are
sold by Rite Aid or some other retailer. By law, the responsibility for certification lies with the manufacturer.
1/21/2010
Page 3 of 4
Please give me a call so we can discuss this further.
Thanks,
Ray Sardo
From: Jack Murray [mailto:]Murray@kayhomeproducts.com]
Sent: Tuesday, January 05, 2010 3:57 PM
To: Sardo, Ray (Assoc-Sac-LT)
Subject: RE: California's enforcement action against Rite Aid and Kay Home Products
Ray,
The letter you reference from the California Air Resources Board ("CARB"), with a cc to James M. Mattesich, is
what your voice mail told me to expect. This same voice mail, which followed our original conversation, has
apparently resulted from you decision "to report" Kay Home Products as the manufacturer.
A later voice mail, during the week of December 21, which came after I made several unanswered calls to you,
suggested that you were going to deal with the indemnification issue, but that certain people were unavailable.
As you know from my speaking with you the labeling and testing done on this product was based on specification
ordered by Rite Aid.
We are happy to discuss this further, but would appreciate the opportunity to understand that Rite Aid is the
responsible party.
Finally, by way of information, Chris Young is not involved in dealing with this situation.
Thanks!
Jack
From: SardoR@gtlaw.com [mailto:SardoR@gtlaw.com]
Sent: Tuesday, January 05, 2010 5:19 PM
To: Jack Murray
Cc: Chris Young
Subject: California's enforcement action against Rite Aid and Kay Home Products
Jack,
I realized I didn't add a subject line to this email yesterday, so I am resending to make sure you didn't overlook it.
I am also cc'ing Chris Young. Please give me a call so we can discuss.
From: SardoR@gtlaw.com [mailto:SardoR@gtlaw.com]
Sent: Monday, January 04, 2010 3:40 PM
To, jmurray@kayhomeproducts.com
Subject:
Hi Jack, and happy new year.
We received a copy of the attached letter over the holidays. It is from the California Air Resources Board
("CARB") and is addressed to Chris Young of your company. I am not sure whether you have seen it yet.
The attached letter further convinces us that we will need your declaration in order to fend off further action from
CARB. CARB appears to have expanded its investigation to include Kay Home Products, and is now demanding
information from Kay Home Products, in addition to the information it already demanded from Rite Aid. The
1/21/2010
Page 4 of 4
declaration we prepared for you addresses the issues raised by CARB, and will assist us in resolving this matter
Please call me at 916-442-1111 so that we can discuss this matter in further detail, and how to finalize your
declaration. Alternatively, I would be happy to call you at a prearranged time, if you can let me know your
availability. This might make more sense given the difficulties we have experienced in reaching one another over
the phone.
Thank you,
Ray Sardo
Raimondo A. Sardo
Associate
Greenberg Traurig, LLP 1 1201 K Street, Suite 1100 1 Sacramento, CA 95814
Tel 916.442.1111 1 Fax 916.448.1709
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1/21/2010
RITE AID HDQTRS. CORP.,
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
Plaintiff,
VS.
NO. 10-692
KAY HOME PRODUCTS, INC.
Defendant.
CIVIL ACTION - LAW
AFFIDAVIT OF SERVICE
PURSUANT TO PA. R.C.P. 405
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF DAUPHIN
SS:
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THE UNDERSIGNED, Frederick Alcaro, being duly sworn according to law,
does depose and say as follows:
1. I am a competent adult and an attorney duly admitted to the Bar of the
Supreme Court of the Commonwealth of Pennsylvania, having Attorney Identification Number
91555.
2. On January 29, 2010, I caused the Complaint to be served upon the
defendant by the mailing of a true and correct copy of the Complaint to the defendant by United
States certified mail, return receipt requested, postage prepaid.
3. I received the return receipt, which was postmarked on February 1, 2010,
indicating that the documents were delivered to and accepted at 90 McMillen Road, Antioch, IL
60002 by or on behalf of the defendant, thereby completing service pursuant to Pa. R.C.P. 403.
The original return receipt signed by or on behalf of the defendant is attached hereto as Exhibit
«A"
Date: February 5, 2010
SWORN TO AND SUBSCRIBED
BEFORE ME THIS S? DAY
2010.
7
Notary Public ?-
Respectfully submitted,
A; ;
Frederick Alcaro (PA 91555)
PEPPER HAMILTON LLP
100 Market Street, Suite 200
P.O. Box 1181
Harrisburg, PA 17108-1181
717.255.1155
717.238.0575 Fax
alcarof@pepperlaw.com
Attorneys for Plaintiff
Rite Aid Hdgtrs.Corp.
COMMONWEALTH OF PENNSYLVANIA
Notarial Seal
wmberiy J. Talaber, Notary Public
City Of Harrisburg, Dauphin County
Commission Eres April 11, 2011
Matnbrar, Partha"Y'niu ^,xs?siation of Notaries
-2-
CERTIFICATE OF SERVICE
I hereby certify that on February 5, 2010, a copy of the foregoing document was
served by United States mail, first class postage prepaid, addressed as follows:
Kay Home Products, Inc.
90 McMillen Road
Antioch, IL 60002
L
Frederick Alcaro
EXHIBIT
«A99
¦ Complete items 1, 2, and 3. Also complete
item 4 if Restricted Delivery is desired.
¦ Print your name and address on the reverse
so that we can return the card to you.
¦ Attach this card to the back of the mailpiece,
or on the front if space permits.
1. Article Addressed to:
KaV Nome, Prod Js, 1i 1?
8q Mc Mi I I "-0 Road
A.
? Agent
B. Received by (Printed Name) C. Dat of elivery
41le k- OG l 10
D. Is delivery address different from item 1? Yes
If YES, enter delivery address below: ? No
70
M ified Mail ? Express Mail
7FEB Q 00 ? 3. rvice Type
? Registered ? Return Receipt for Merchandise
Insured Mail ? C.O.D.
5 ? 4. Restricted Delivery? P tra Fee) ? Yes
0q a5o Oooo 7 05x9
r from service
pomestic Return Receipt 1 02595 oz-M-i 54
I s
RITE AID HDQTRS. CORP.
30 Hunter Lane, Camp Hill, PA 17011,
Plaintiff,
VS. :
KAY HOME PRODUCTS, INC.
89 McMillen Road
Antioch, IL 60002
Defendants.
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSLYVANIA
CIVIL ACTION NO. 10-692 Civil Term
ANSWER TO COMPLAINT WITH NEW MATTER AND COUNTERCLAIM
Date: February 25, 2010
n
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John Murray
Kay Home Products cy? l
90 McMillen Road -`
Antioch, IL 60002 - ! =
Phone: 847-395-3300 {.?
Fax: 847-395-3305
Email: jmurray@kayhomeproducts.com
Kay Home Products
Pro Se
RITE AID HDQTRS. CORP. IN THE COURT OF COMMON PLEAS OF
30 Hunter Lane, Camp Hill, PA 17011,
CUMBERLAND COUNTY, PENNSLYVANIA
Plaintiff,
vs.
KAY HOME PRODUCTS, INC.
90 McMillen Road
Antioch, IL 60002
Defendants
: CIVIL. ACTION NO. 10-692 Civil Term
NOTICE
YOU HAVE BEEN SUED IN COURT. If you wish to defend against the claims set forth in the
following pages, you must take action within twenty (20) days after this Complaint and Notice
are served, by entering a written appearance personally or by attorney and filing in writing with
the Court your defenses or objections to the claims set forth against you. You are warned that if
you fail to do so the case may proceed without you and a judgment may be entered against you
by the Court without fiuther notice for any money claimed in the Complaint or for any other
claim or relief requested by the Plaintiff. You may lose money or property or other rights
important to you.
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT
HAVE A LAWYER, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW. THIS
OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER.
IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE TO
PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER LEGAL
SERVICES TO ELIGIBLE PERSONS AT A REDUCED FEE OR NO FEE.
CUMBERLAND COUNTY BAR ASSOCIATION
32 S. Bedford Street
Carlisle, Pennsylvania 17013
(800) 990-9108
RITE AID HDQTRS. CORP. IN THE COURT OF COMMON PLEAS OF
30 Hunter Lane, Camp Hill, PA 17011,
CUMBERLAND COUNTY, PENNSLYVANIA
Plaintiff,
vs.
KAY HOME PRODUCTS, INC.
90 McMillen Road
Antioch, IL 60002
Defendants.
. CIVIL ACTION NO. 10-692 Civil Term
AVISO
USTED HA SIDO DEMANDADO/A EN CORTE. Si usted desea defenderse de las demandas
que se presentan mds adelante en las siguientes pfiginas, debe tomar acci6n dentro de los
prbximos veinte (20) dies despu6s de la notificaci6n de esta Demanda y Aviso radicando
personalmente o por medio de un abogado una comparecencia escrita y radicando en la Corte por
escrito sus defensas de, y objecciones a, las demandas presentadas aqui en contra suya. Se le
advierte de que si usted fella de tomar accidn como se describe anteriormente, el caso puede
proceder sin usted y un fallo por cualquier suma de dinero reclamada en la demanda o cualquier
otra reclamaci6n o remedio solicitado por el demandante puede ser dictado en contra suya por la
Corte sin mfis aviso adicional. Usted puede perder dinero o propiedad u otros derechos
importantes para usted.
USTED DEBE LLEVAR ESTE DOCUMENTO A SU ABOGADO INMEDIATAMENTE. SI
USTED NO TIENE UN ABOGADO, LLAME O VAYA A LA SIGUIENTE OFICINA. ESTA
OFICINA PUEDE PROVEERLE INFORMACION A CERCA DE COMO CONSEGUIR UN
ABOGADO.
SI USTED NO PUEDE PAGAR POR LOS SERVICIOS DE UN ABOGADO, ES POSIBLE
QUE ESTA OFICINA LE PUEDA PROVEER INFORMACION SOBRE AGENCIAS QUE
OFREZCAN SERVICIOS LEGALES SIN CARGO O BAJO COSTO A PERSONAS QUE
CUALIFICAN.
CUMBERLAND COUNTY BAR ASSOCIATION
32 S. Bedford Street
Carlisle, Pennsylvania 17013
(800) 990-9108
RITE AID HDQTRS. CORP. : IN THE COURT OF COMMON PLEAS OF
30 Hunter Lane, Camp Hill, PA 17011, CUMBERLAND COUNTY, PENNSLWANIA
Plaintiff,
vs.
KAY HOME PRODUCTS, INC.
89 McMillen Road
Antioch, IL 60002
Defendants.
CIVIL ACTION NO. 10-692 Civil Term
ANSWER TO COMPLAINT WITH NEW MATTER AND COUNTERCLAIM
Defendant Kay Home Products ("Kay") for its Answer to Plaintiffs Complaint, states as
follows:
AS TO THE PARTIES
1. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 1, and strict proof thereof is demanded
at trial.
2. Denied. Kay is the trade name for an Ohio LLC with its principal place of
business at 90 McMillen Road, Antioch, Illinois.
JURISDICTION AND VENUE
3. Denied. Paragraph 3 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
4. Denied. Paragraph 4 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
5. Denied. Paragraph 5 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
-1-
RELEVANT FACTS
6. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 6, and strict proof thereof is demanded
at trial.
7. Denied. Paragraph 7 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
8. Denied. Paragraph 8 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
9. Denied. Paragraph 9 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
10. Denied. Paragraph 10 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
11. Denied. Paragraph 11 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
12. Denied. Paragraph 12 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
13. Denied. Paragraph 13 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
14. Denied. Paragraph 14 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
15. Denied. Paragraph 15 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
16. Denied. Paragraph 16 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
17. Denied. Paragraph 17 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
-2-
18. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 18, and strict proof thereof is
demanded at trial.
19. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 19, and strict proof thereof is
demanded at trial.
20. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 20, and strict proof thereof is
demanded at trial.
21. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 21, and strict proof thereof is
demanded at trial.
22. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 22, and strict proof thereof is
demanded at trial.
23. Denied as stated. On or about October 5, 2009, Rite Aid contacted Kay by
telephone concerning the Boards investigation in the person of Rite Aid employee
James J. Comitale. Kay provided information requested by Rite Aid. Kay also
offered to address the Board concern itself but Mr. Comitale told Kay that he
believed the information received would address the Boards concern. Comitale
was asked to call if he needed further info. Kay did not hear back from Rite Aid
until December, more than two months later.
24. Denied. See answer to paragraph 23 above, which answer is incorporated by
reference.
-3-
25. Admitted and denied. Admitted that e-mail referred to in paragraph 25 and
attached to Plaintiffs' Complaint as Exhibit D was received. Denied. Remainder
of Paragraph 25 is a conclusion of law to which no answer need be filed and strict
proof thereof is demanded at trial.
26. Admitted and denied. Admitted that the letter referred to in paragraph 26 and
attached to Plaintiffs' Complaint as Exhibit E was received. Denied. Remainder
of Paragraph 26 is a conclusion of law to which no answer need be filed and strict
proof thereof is demanded at trial.
27. Admitted and denied. Admitted that e-mail referred to in paragraph 27 and
attached to Plaintiffs' Complaint as Exhibit F was received. Denied. Remainder
of Paragraph 27 is a conclusion of law to which no answer need be filed and strict
proof thereof is demanded at trial.
28. Admitted and denied. Admitted that the letter referred to in paragraph 28 and
attached to Plaintiffs' Complaint as Exhibit G was received. Denied. Remainder
of Paragraph 28 is a conclusion of law to which no answer need be filed and strict
proof thereof is demanded at trial.
29. Admitted and denied. Admitted that e-mail referred to in paragraph 29 and
attached to Plaintiffs' Complaint as Exhibit H was received. Denied. Remainder
of Paragraph 29 is a conclusion of law to which no answer need be filed and strict
proof thereof is demanded at trial.
30. Denied. Paragraph 30 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
31. Denied. Paragraph 31 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
32. Denied. Paragraph 32 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
33. Admitted and denied. See answers to paragraph l though 32; Kay incorporates by
reference all of these answers as if fully set forth herein.
-4-
34. Denied. Paragraph 34 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
35. Denied. Paragraph 35 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
36. Denied. Paragraph 36 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
WHEREFORE, Kay respectfully requests that the Court deny the Plaintiffs' request and
that it award such relief to Kay as the Court deems just and proper under the
circumstances.
NEW MATTER
37. Plaintiffs' Complaint fails to state a claim upon which relief may be granted.
38. By Plaintiffs' account, some of the sale of product occurred prior to the date of
the Indemnity Agreement attached to the Complaint as Exhibit A and accordingly,
there is no mutuality of consideration for the claimed indemnification.
39. Plaintiff presented agreement attached to Complaint as Exhibit A without
discussion or justification with Kay, and therefore the Agreement was signed
under duress and is not enforceable.
COUNTERCLAIM
40. Kay incorporates by reference all of its Answers and New Matter contained in
paragraphs 1 through 39 above, as if fully set forth herein.
-5-
41. To the extent that Kay is found to be have responsibilities under the Defense and
Indemnity Agreement which is denied, Rite Aid has failed to cooperate with Kay
as required by paragraph 4 of the Defense and Indemnity Agreement attached to
Plaintiffs' Complaint as Exhibit A.
42. Pursuant to paragraph 5 of Defense and Indemnity Agreement attached to
Plaintiffs' Complaint as Exhibit A, Kay is entitled to recover all of its attorney's
fees and costs associated with this action.
WHEREFORE, Kay respectfully requests that the Court enter a judgment for it in
accordance with allegations in the Counter Claim awarding such relief to Kay as the
Court deems just and proper under the circumstances.
Kay Home Products
90 McMillen Road
Antioch, IL 60002
(847) 395-3300
(847) 395-3305 (Fax)
jmurray@kayhomeproducts.com
Kay Home Products
Dated: February 25, 2010 Pro Se
-6-
VERIFICATION
I, John J. Murray, hereby state that I am a Member and Chief Executive Officer
for Akerue Industries, LLC DBA Kay Home Products and am authorized to make this
verification on its behalf. I verify the statements made in the forgoing Answer with New
Matter and Counterclaim are true and correct to the best of my knowledge, information
and belief.
I understand that the statements in the foregoing document are made subject to the
penalties of 18 Pa. C.S. § 4909 relating to unworn falsification to authorities.
Dated: February 25, 2010
CERTIFICATION OF SERVICE
I, hereby certify that on February 25, 2010, a copy of the foregoing
document was served by United States mail, first class postage prepaid, addressed as
follows:
Brian P. Downey, Esquire
Frederick Alcaro, Esquire
Pepper Hamilton LLP
Suite 200
100 Market Street
Harrisburg, PA 17108-1181
Brian P. Downey (PA 59891)
Frederick Alcaro (PA 91555)
PEPPER HAMILTON LLP
100 Market Street, Suite 200
PO Box 1181
Harrisburg, PA 17108-1181
717.255.1155
717.238.0575 (fax)
Attorneys for Plaintiff
Rite Aid HDQTRS. Corp.
RITE AID HDQTRS. CORP.,
Plaintiff,
vs.
KAY HOME PRODUCTS, INC.
Defendant.
To Plaintiff:
You are hereby notified to file a written
response to the enclosed Preliminary
Objections within twenty (20) days from
service hereof or a judgment may be entered
against you.
C? ?1
IN THE COURT ON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
NO. 10-692
CIVIL ACTION - LAW
• -? rte.,
_?
co
- -<
PLAINTIFF RITE AID HDQTRS. CORP.'S
PRELIMINARY OBJECTIONS IN THE NATURE OF A MOTION TO STRIKE
TO KAY HOME PRODUCTS, INC.'S
ANSWER TO COMPLAINT WITH NEW MATTER AND COUNTERCLAIM
Plaintiff Rite Aid HDQTRS. CORP., by its undersigned attorneys, hereby assert
the following preliminary objections in the nature of a motion to strike to Defendant Kay Home
Products, Inc.'s Answer to Complaint with New Matter and Counterclaim in this matter and in
support thereof state as follows:
BACKGROUND
1. On January 29, 2010, Plaintiff filed its complaint against Defendant,
asserting one count for Declaratory Judgment against Defendant as to Defendant's
responsibilities under the Defense and Indemnity Agreement.
2. On February 25, 2010, Defendant attempted to file its Answer to
Complaint with New Matter and Counterclaim before this Court. See Answer to Complaint with
New Matter and Counterclaim, attached hereto as Exhibit A.
3. Defendant specifically identifies itself as presenting its Answer to
Complaint with New Matter and Counterclaim pro se. See Ex. A at Signature Blocks on Cover
Page and page 6 ("Kay Home Products, Pro Se").
4. Defendant identifies itself in its Answer to Complaint with New Matter
and Counterclaim as "the trade name for an Ohio LLC." See id. at ¶ 2.
5. In the signature block of its Answer to Complaint with New Matter and
Counterclaim, Defendant identifies Jack Murray, who signed the Answer on behalf of the
Defendant. See id. at Signature Blocks on Cover Page and page 6.
6. Upon information and belief, Jack Murray is not an attorney licensed to
practice law in Commonwealth of Pennsylvania, but rather is the CEO of Defendant.
7. No attorney has entered an appearance on behalf of Defendant in this
matter.
8. Defendant also included a Counterclaim against Plaintiff. See id. at ¶¶ 40-
43.
9. Defendant's Counterclaim is three paragraphs in length, and provides no
more than an affirmative defense to Plaintiffs claims.
-2-
FIRST PRELIMINARY OBJECTION
Objection to Answer to Complaint with New Matter and Counterclaim
Based on Failure to Conform to Law or Rule of Court
10. Plaintiff incorporates paragraphs 1 through 9 above, by reference.
11. Pennsylvania Rule of Civil Procedure 1028(a)(2) permits a party to raise
an objection where the pleading fails to conform to a law or rule of court.
12. Defendant is an limited liability corporation.
13. Defendant has filed its Answer to Complaint with New Matter and
Counterclaim pro se.
14. Under Pennsylvania law, a corporation may not proceed pro se, nor may it
be represented by non-attorneys. See Walacavage v. Excell 2000, Inc" 480 A.2d 281, 284-85
(Pa. Super. 1984) (holding that "law is clear" that corporation may appear in court only through
an attorney admitted to practice before the court); Westmoreland County v. RTA Group Inc.,
767 A.2d 1144, 1149, n. 8 (Pa. Commw. Ct. 2001) (noting it is "well-established law" that non-
attorneys may not represent corporations and other unincorporated associations), app. denied,
788 A.2d 382 (Pa. 2001).
15. As Defendant's Answer to Complaint with New Matter and Counterclaim
has not been presented by an attorney licensed to practice law in this Commonwealth, such
Answer to Complaint with New Matter and Counterclaim fails to conform to law and/or rule of
court.
16. Therefore, such Answer to Complaint with New Matter and Counterclaim
should be stricken from the docket for failure to conform to law and/or rule of court.
WHEREFORE, Plaintiff requests that this Court sustain Plaintiff's Preliminary
Objections to Defendant's Answer to Complaint with New Matter and Counterclaim and enter an
Order striking such pleading from the docket for its failure to comply with Pa. R.C.P. 1028(a)(2).
-3-
SECOND PRELIMINARY OBJECTION
Objection to Counterclaim
Based on Legal Insufficiency
17. Plaintiff incorporates paragraphs 1 through 16 above, by reference.
18. Pennsylvania Rule of Civil Procedure 1028(a)(4) permits a party to raise
an objection where the pleading is legally insufficient.
19. Defendant's Counterclaim solely alleges that if it is found to have
responsibilities under the Defense and Indemnity Agreement, "Rite Aid has failed to cooperate
with Kay as required by paragraph 4." See Ex. A at ¶ 41.
20. Defendant's Counterclaim is not a recognizable claim at law or equity
under Pennsylvania law, but rather an affirmative defense to Plaintiff's claim.
21. Defendant has failed to set forth a claim upon which relief may be granted.
22. Defendant has failed to set forth any facts in support of its Counterclaim.
WHEREFORE, Plaintiff requests that this Court sustain Plaintiff's Preliminary
Objections to Defendant's Answer to Complaint with New Matter and Counterclaim and enter an
Order striking such pleading from the docket for its failure to comply with Pa. R.C.P. 1028(a)(4).
Date: March 8, 2010
Irian P. owne
rederick 1 o (PA 9155
Sui fi1f?,0 Ntkket Street
P.O. Box
Harrisburg, PA 17108-1181
Phone: (717) 255-1155
Fax: (717) 238-0575
Attorneys for Plaintiff
Rite Aid HDQTRS. Corp.
-4-
A
RITE AID HDQTRS. CORP. : IN THE COURT OF COMMON PLEAS OF
30 Hunter Lane, Camp Hill, PA 17011,
: CUMBERLAND COUNTY, PENNSLYVANIA
Plaintiff,
vs.
KAY HOME PRODUCTS, INC.
89 McMillen Road
Antioch, IL 60002
Defendants.
CIVIL ACTION NO. 10-692 Civil Term
ANSWER TO COMPLAINT WITH NEW MATTER AND COUNTERCLAIM
Date: February 25, 2010
John Murray
Kay Home Products
90 McMillen Road
Antioch, IL 60002
Phone: 847-395-3300
Fax: 847-395-3305
Email: jmurray@kayhomeproducts.com
Kay Home Products
Pro Se
RITE AID HDQTRS. CORP.' IN THE COURT OF COMMON PLEAS OF
30 Hunter Lane, Camp Hill, PA 17011,
CUMBERLAND COUNTY, PENNSLYVANIA
Plaintiff,
VS. CIVIL. ACTION NO. 10-692 Civil Term
KAY HOME PRODUCTS, INC.
90 McMillen Road
Antioch, IL 60002
Defendants.
NOTICE
YOU HAVE BEEN SUED IN COURT. If you wish to defend against the claims set forth in the
following pages, you must take action within twenty (20) days after this Complaint and Notice
are served, by entering a written appearance personally or by attorney and filing in writing with
the Court your defenses or objections to the claims set forth against you. You are warned that if
you fail to do so the case may proceed without you and a judgment may be entered against you
by the Court without further notice for any money claimed in the Complaint or for any other
claim or relief requested by the Plaintiff. You may lose money or property or other rights
important to you.
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT
HAVE A LAWYER, CIO TO. OR TELEPHONE THE OFFICE SET FORTH BELOW. THIS
OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER.
IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE TO
PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER LEGAL
SERVICES TO ELIGIBLE PERSONS AT A REDUCED FEE OR NO FEE.
CUMBERLAND COUNTY BAR ASSOCIATION
32 S. Bedford Street
Carlisle, Pennsylvania 17013
(800) 990-9108
RITE AID HDQTRS. CORP. IN THE COURT OF COMMON PLEAS OF
30 Hunter Lane, Camp Hill, PA 17011,
CUMBERLAND COUNTY, PENNSLYVANIA
Plaintiff,
VS. . CIVIL ACTION NO. 10-692 Civil Term
KAY HOME PRODUCTS, INC.
90 McMillen Road
Antioch, IL 60002
Defendants.
AVISO
LISTED HA SIDO DEMANDADO/A EN CORTE. Si usted desea defenderse de las demandas
que se presentan m6s adelante en las siguientes pfiginas, debe tomar accibn dentro de Jos
pr6ximos veinte (20) dial despu6s de Is notificaci6n de esta Demands y Aviso radicando
personalmente o por medio de un abogado una comparecencia escrita y radicando en la Corte por
escrito sus defensas de, y objecciones a, las demandas presentadas aqua en contra soya. Se le
advierte de que si usted falls de tomar acci6n como se describe anteriormente, el caso puede
proceder sin usted y un fallo por cualquier soma de dinero reclamada en Is demands o cualquier
otra reclamacibn o remedio solicitado por el demandante puede ser dictado en contra suya por la
Corte sin mbs aviso adicional. Usted puede perder dinero o propiedad u otros derechos
importantes pare usted.
USTED DEBE LLEVAR ESTE DOCUMENTO A SU ABOGADO INMEDIATAMENTE. SI
USTED NO TIENE UN ABOGADO, LLAME O VAYA A LA SIGUIENTE OFICINA. ESTA
OFICINA PUEDE PROVEERLE INFORMACION A CERCA DE COMO CONSEGUIR UN
ABOGADO.
SI USTED NO PUEDE PAGAR POR LOS SERVICIOS DE UN ABOGADO, ES POSIBLE
QUE ESTA OFICINA LE PUEDA PROVEER INFORMACION SOBRE AGENCIAS QUE
OFREZCAN SERVICIOS LEGALES SIN CARGO O BAJO COSTO A PERSONAS QUE
CUALIFICAN.
CUMBERLAND COUNTY BAR ASSOCIATION
32 S. Bedford Street
Carlisle, Pennsylvania 17013
(800) 990-9108
RITE AID HDQTRS. CORP. : IN THE COURT OF COMMON PLEAS OF
30 Hunter Lane, Camp Hill, PA 17011, CUMBERLAND COUNTY, PENNSLYVANIA
Plaintiff,
vs. CIVIL ACTION NO. 10-692 Civil Term
KAY HOME PRODUCTS, INC.
89 McMillen Road
Antioch, IL 60002
Defendants.
ANSWER TO COMPLAINT WITH NEW MATTER AND COUNTERCLAIM
Defendant Kay Home Products ("Kay") for its Answer to Plaintiffs Complaint, states as
follows:
AS TO THE PARTIES
1. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 1, and strict proof thereof is demanded
at trial.
2. Denied. Kay is the trade name for an Ohio LLC with its principal place of
business at 90 McMillen Road, Antioch, Illinois.
JURISDICTION AND VENUE
3. Denied. Paragraph 3 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
4. Denied. Paragraph 4 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
5. Denied. Paragraph 5 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
-1-
RELEVANT FACTS
6. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 6, and strict proof thereof is demanded
at trial.
7. Denied. Paragraph 7 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
8. Denied. Paragraph 8 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
9. Denied. Paragraph 9 is a conclusion of law to which no answer need be filed and
strict proof thereof is demanded at trial.
10. Denied. Paragraph 10 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
11. Denied. Paragraph 11 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
12. Denied. Paragraph 12 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
13. Denied. Paragraph 13 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
14. Denied. Paragraph 14 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
15. Denied. Paragraph 15 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
16. Denied. Paragraph 16 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
17. Denied. Paragraph 17 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
-2-
18. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 18, and strict proof thereof is
demanded at trial.
19. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 19, and strict proof thereof is
demanded at trial.
20. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 20, and strict proof thereof is
demanded at trial.
21. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 21, and strict proof thereof is
demanded at trial.
22. Denied. After reasonable investigation, Defendant is without sufficient knowledge
to form a belief as to the truth of paragraph 22, and strict proof thereof is
demanded at trial.
23. Denied as stated. On or about October 5, 2009, Rite Aid contacted Kay by
telephone concerning the Boards investigation in the person of Rite Aid employee
James J. Comitale. Kay provided information requested by Rite Aid. Kay also
offered to address the Board concern itself but Mr. Comitale told Kay that he
believed the information received would address the Boards concern. Comitale
was asked to call if he needed further info. Kay did not hear back from Rite Aid
until December, more than two months later.
24. Denied. See answer to paragraph 23 above, which answer is incorporated by
reference.
-3-
25. Admitted and denied. Admitted that e-mail referred to in paragraph 25 and
attached to Plaintiffs' Complaint as Exhibit D was received. Denied. Remainder
of Paragraph 25 is a conclusion of law to which no answer need be filed and strict
proof thereof is demanded at trial.
26. Admitted and denied. Admitted that the letter referred to in paragraph 26 and
attached to Plaintiffs' Complaint as Exhibit E was received. Denied. Remainder
of Paragraph 26 is a conclusion of law to which no answer need be filed and strict
proof thereof is demanded at trial.
27. Admitted and denied. Admitted that e-mail referred to in paragraph 27 and
attached to Plaintiffs' Complaint as Exhibit F was received. Denied. Remainder
of Paragraph 27 is a conclusion of law to which no answer need be filed and strict
proof thereof is demanded at trial.
28. Admitted and denied. Admitted that the letter referred to in paragraph 28 and
attached to Plaintiffs' Complaint as Exhibit G was received. Denied. Remainder
of Paragraph 28 is a conclusion of law to which no answer need be filed and strict
proof thereof is demanded at trial.
29. Admitted and denied. Admitted that a-mail referred to in paragraph 29 and
attached to Plaintiffs' Complaint as Exhibit H was received. Denied. Remainder
of Paragraph 29 is a conclusion of law to which no answer need be filed and strict
proof thereof is demanded at trial.
30. Denied. Paragraph 30 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
31. Denied. Paragraph 31 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
32. Denied. Paragraph 32 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
33. Admitted and denied. See answers to paragraph 1 though 32; Kay incorporates by
reference all of these answers as if fully set forth herein.
-4-
34. Denied. Paragraph 34 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
35. Denied. Paragraph 35 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
36. Denied. Paragraph 36 is a conclusion of law to which no answer need be filed
and strict proof thereof is demanded at trial.
WHEREFORE, Kay respectfully requests that the Court deny the Plaintiffs' request and
that it award such relief to Kay as the Court deems just and proper under the
circumstances.
NEW MATTER
37. Plaintiffs' Complaint fails to state a claim upon which relief may be granted.
38. By Plaintiffs' account, some of the sale of product occurred prior to the date of
the Indemnity Agreement attached to the Complaint as Exhibit A and accordingly,
there is no mutuality of consideration for the claimed indemnification.
39. Plaintiff presented agreement attached to Complaint as Exhibit A without
discussion or justification with Kay, and therefore the Agreement was signed
under duress and is not enforceable.
COUNTERCLAIM
40. Kay incorporates by reference all of its Answers and New Matter contained in
paragraphs 1 through 39 above, as if fully set forth herein.
-5-
41. To the extent that Kay is found to be have responsibilities under the Defense and
Indemnity Agreement which is denied, Rite Aid has failed to cooperate with Kay
as required by paragraph 4 of the Defense and Indemnity Agreement attached to
Plaintiffs' Complaint as Exhibit A.
42. Pursuant to paragraph 5 of Defense and Indemnity Agreement attached to
Plaintiffs' Complaint as Exhibit A, Kay is entitled to recover all of its attorney's
fees and costs associated with this action.
WHEREFORE, Kay respectfully requests that the Court enter a judgment for it in
accordance with allegations in the Counter Claim awarding such relief to Kay as the
Court deems just and proper under the circumstances.
Kay Home Products
90 McMillen Road
Antioch, IL 60002
(847) 395-3300
(847) 395-3305 (Fax)
imurray@kayhomeproducts.com
Kay Home Products
Dated: February 25, 2010 Pro Se
-6-
VERIFICATION
I, John J. Murray, hereby state that I am a Member and Chief Executive Officer
for Akerue Industries, LLC DBA Kay Home Products and am authorized to make this
verification on its behalf. I verify the statements made in the forgoing Answer with New
Matter and Counterclaim are true and correct to the best of my knowledge, information
and belief.
I understand that the statements in the foregoing document are made subject to the
penalties of 18 Pa. C.S. § 4909 relating to unworn falsification to authorities.
Dated: February 25, 2010
S' ;it a4?1
ture
CERTIFICATION OF SERVICE
I, hereby certify that on February 25, 2010, a copy of the foregoing
document was served by United States mail, first class postage prepaid, addressed as
follows:
Brian P. Downey, Esquire
Frederick Alcaro, Esquire
Pepper Hamilton LLP
Suite 200
100 Market Street
Harrisburg, PA 17108-1181
CERTIFICATE OF SERVICE
I hereby certify that on March 8, 2010, a copy of the foregoing document was
served by United States mail, first class postage prepaid, addressed as follows:
Kay Home Products, Inc.
90 McMillen Road
Antioch, IL 60002
RITE AID HDQTRS. CORP.,
Plaintiff,
cA/A~
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
NO. 10-692
vs. ~ ~..~
r:
KAY HOME PRODUCTS, INC. ~ CIVIL ACTION -LAW ,--';~
Defendant. ~ -
--.
_',_.
PRAECIPE TO LIST PLAINTIFF RITE AID HDQRTS. CORP.r~ '~-
PRELIMINARY OBJECTIONS FOR ARGUMENT ~~c
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TO THE PROTHONOTARY:
Please list the above-referenced matter for the July 7, 2010 argument court.
Matter To Be Argued: Preliminary Objection of Plaintiff Rite Aid Hdgrts. Corp.
In The Nature of a Motion To Strike To Kay Home
Products, Inc.'s Answer to Complaint with New Matter and
Counterclaim, filed on March 8, 2010
2. Counsel:
a. Counsel for Plaintiff Who Will Argue The Case:
Brian P. Downey and/or Frederick Alcaro, Pepper Hamilton LLP,
Suite 200, 100 Market Street, P.O. Box 1181, Harrisburg, PA 17108.
b. Counsel for Defendant Who Will Argue The Case:
Unknown. Defendant currently representing itself Pro Se, which is one of
the bases for Plaintiff's preliminary objection.
I will notify all parties in writing within two days that this case has been listed for
argument.
4. Argument Court Date: July 7, 2010.
Date: June 14, 2010
Brian P. Downey (PA 59891)
Frederick Alcaro (PA 91555)
PEPPER HAMILTON Lt,P
Suite 200, 100 Market Street
P.O. Box 1181
Harrisburg, PA 17108-1181
Phone: (717) 255-1155
Fax: (717)238-0575
Attorneys for Plaintiff
Rite Aid HDQTRS. Corp.
-2-
CERTIFICATE OF SERVICE
I hereby certify that on June 14, 2010, a copy of the foregoing document was
served by United States mail, first class postage prepaid, addressed as follows:
Kay Home Products, Inc.
90 McMillen Road
Antioch, IL 60002
rederick Alcaro
M
RITE AID HDQTRS. CORP.,
Plaintiff,
vs.
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
NO. 10-692
KAY HOME PRODUCTS, INC. ~ CIVIL ACTION -LAW ~~" '~ A~~
b
1
Defendant.
`„ C' -i-
PRAECIPE TO LIST PLAINTIFF RITE AID HDORTS. CORP.'~r-.-' ~ ~` ~'
PRELIMINARY OBJECTIONS FOR ARGUMENT ~~~'- ' =_~'~~
._ _ r~ {
TO THE PROTHONOTARY: ~ ~:_~ -- `~'~'
.r.. ;.P'
Please list the above-referenced matter for the August 18, 2010 argument court. ``~'' ~
1. Matter To Be Argued: Preliminary Objection of Plaintiff Rite Aid Hdgrts. Corp.
In The Nature of a Motion To Strike To Kay Home
Products, Inc.'s Answer to Complaint with New Matter and
Counterclaim, filed on March 8, 2010
2. Counsel:
a. Counsel for Plaintiff Who Will Argue The Case:
Brian P. Downey and/or Frederick Alcaro, Pepper Hamilton LLP,
Suite 200, 100 Market Street, P.O. Box 1181, Harrisburg, PA 17108.
b. Counsel for Defendant Who Will Argue The Case:
Unknown. Defendant currently representing itself Pro Se, which is one of
the bases for Plaintiff s preliminary objection.
Date
3. I will notify all parties in writing within two days that this case has been listed for
argument.
4. Argument Court Date: August 18, 2010.
June 25, 2010 ~~ '
('
Brian P. Downey (PA 59891)
Frederick Alcaro (PA 91555)
PEPPER HAMILTON LLP
Suite 200, 100 Market Street
P.O. Box 1181
Harrisburg, PA 17108-1181
Phone: (717) 255-1155
Fax: (717)238-0575
Attorneys for Plaintiff
Rite Aid HDQTRS. Corp.
-2-
CERTIFICATE OF SERVICE
I hereby certify that on June 25, 2010, a copy of the foregoing document was
served by United States mail, first class postage prepaid, addressed as follows:
Kay Home Products, Inc.
90 McMillen Road
Antioch, IL 60002
Frederick Alcaro
RITE AID HDQTRS. CORP.,
PLAINTIFF
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
V.
KAY HOME PRODUCTS, INC.,
DEFENDANT
10-0692 CIVIL TERM
BEFORE OILER, J. AND MASILAND, J.
ORDER OF COURT
AND NOW, this day of September, 2010, upon consideration
of the preliminary objections of the plaintiff, Rite Aid Hdqtrs. Corp. to defendant Kay
Home Products, Inc.'s answer to the complaint with new matter and counterclaim,
defendant's answer to the complaint with new matter and counterclaim is hereby
stricken from the docket.
By the Court,
? Brian P. Downey, Esquire
Frederick Alcaro, Esquire
For Plaintiff
ohn Murray, Pro se
Kay Home Products
90 McMillen Road
Antioch, IL 60002
saa
tit= l /n?l lISJ,
Albert H. Masland, J.
C
i
RITE AID HDQTRS. CORP.,
PLAINTIFF
V.
KAY HOME PRODUCTS, INC.,
DEFENDANT
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
10-0692 CIVIL TERM
BEFORE OLER, J. AND MASLAND, J.
MEMORANDUM OPINION AND ORDER OF COURT
Masland, J., September 14, 2010:--
Before the court are preliminary objections filed by plaintiff Rite Aid Hdqtrs.
Corp. in the nature of a motion to strike defendant's answer to complaint with
new matter and counterclaim. At argument on August 18, 2010, defendant, Kay
Home Products, Inc., appeared through its Chief Executive Officer, John J.
Murray, who acknowledged that he is not an attorney and that he submitted the
pleadings in question.
Although we are striking defendant's answer to complaint with new matter
and counterclaim, we note the following from its contents:
1. The response to paragraph 2 of the complaint is "Denied. Kay is the
trade name for an Ohio LLC with its principal place of business at 90 McMillen
Road, Antioch, Illinois."
2. The pleading is verified by John J. Murray who describes himself on
the verification as "Member and Chief Executive Officer for Akerue Industries,
LLC DBA Kay Home Products."
3. The pleading is also submitted on behalf of "Kay Home Products pro
se" by John J. Murray.
10-0692 CIVIL TERM
4. There is nothing in the pleading or of record to indicate that Mr. Murray
is licensed to practice law anywhere, let alone in the Commonwealth of
Pennsylvania.
Therefore, it is undisputed that Kay Home Products (whether its moniker
be appended by LLC or Inc.) is an artificial business entity, which filed an answer
with new matter and counterclaim in a self-represented capacity. It is well
established under Pennsylvania Law that a corporation may not proceed pro se,
nor may it be represented by non-attorneys. Walacavage v. Excell 2000, Inc.,
480 A.2d 281 (Pa. Super. 1984).' This prohibition extends equally to all artificial
entities, including LLCs. See Rowland v. California Men's Colony, 506 U.S. 194,
201-02 (1993) (interpreting federal corollary to Pennsylvania rule).
Accordingly we will enter the following order:
ORDER OF COURT
AND NOW, this /1Y 1 day of September, 2010, upon consideration
of the preliminary objections of the plaintiff, Rite Aid Hdqtrs. Corp. to defendant Kay
Home Products, Inc.'s answer to the complaint with new matter and counterclaim,
defendant's answer to the complaint with new matter and counterclaim is hereby
stricken from the docket.
' The courts of the two sister states having a connection with defendant
corporation have similarly and consistently held that a corporation may appear in
court only through an attorney admitted to practice before the court. See e.g.,
Gass v. Headlands Contracting & Tunneling, Inc., 2008 WL 4964656 (Ohio App.
11 Dist.) and Siakpere v. City of Chicago, 872 N.E.2d 495 (III. App.3d 2007);
Union Sav. Assn v. Home Owner's Aid, Inc., 262 N.E.2d 558 (Ohio 1970).
-2-
10-0692 CIVIL TERM
By the Court,
Albert H. Masland, J.
Brian P. Downey, Esquire
Frederick Alcaro, Esquire
For Plaintiff
John Murray, Pro se
Kay Home Products
90 McMillen Road
Antioch, IL 60002
saa
-3-
FILED-OFFICE
OLIVER, PRICE & RHODES _
Oit. THE PROTHONOTARY
Karoline Mehalchick, Esquire
I.D. No.: 87641 2010 SEP 30 AM 10. 14
I
1212 South Abington Road
P.O. Box 240
Clarks Summit, PA 18411
CUMBERLAND COUNTY
Ph: (570) 585-1200 PENNSYLVANIA
Fax: (570) 585-5100
Email km@oprlaw.com
RITE AID HDQTRS. CORP., IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY,
Plaintiff PENNSYLVANIA
VS.
CIVIL ACTION - LAW
KAY HOME PRODUCTS, INC.
No. 10-692 Civil Term
Defendant
ENTRY OF APPEARANCE
TO: Clerk of Judicial Records
Please enter my appearance on behalf of the Defendant, AKERUE INDUSTRIES, LLC, d/b/a
KAY HOME PRODUCTS.
Respectfully submitted,
OLIVER, PRICE & RHODES
lt? ? -
Karoline Mehalchick, Esquire
Attorney I.D. No.: 87641
1212 South Abington Road
P.O. Box 240
Clarks Summit, PA 18411
Tel: (570) 585-1200
Fax: (570) 585-5100
Email: km ,oprlaw.com
CERTIFICATE OF SERVICE
I, KAROLINE MEHALCHICK, Esquire, of Oliver, Price & Rhodes, hereby certify that on
the 29th day of September, 2010, I served a true and correct copy of the foregoing ENTRY of
APPEARANCE by placing the same in the United States Mail, First Class Postage Prepaid, at Clarks
Summit, Pennsylvania, addressed as follows:
Brian P. Downey, Esquire
Frederick Alcaro, Esquire
Pepper Hamilton, LLP
100 Market Street, Suite 200
Harrisburg, PA 17108-1181
L6"- ? -%1-
Karoline Mehalchick, Esquire
RNEHALCHICK\Kay Home Products\Pleadings\Entry ofAppearance.docx
Oliver, Price & Rhodes
Karoline Mehalchick, Esquire
Attorney I.D. No. 87641
1212 South Abington Road
P.O. Box 240
Clarks Summit, PA 18411
Ph: (570) 585-1200
Fax: (570) 585-5100
Email: kmapprlaw.com
RITE AID HDQTRS. CORP.,
VS.
FILED-OFFICE
"nIGO DP*C 2?3 P1 ti: r.^
CUMBI~ i P 14 B L? E.'I T"
i? NN Y UV'P ` I
Plaintiff
KAY HOME PRODUCTS, INC.,
Defendant
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
Civil Action No. 10-692 Civil Term
NOTICE TO PLEAD
TO: Rite Aid Hdqtrs. Corp.
c/o Frederick Alvaro, Esq.
Pepper Hamilton LLP
100 Market Street, Suite 200
Post Office Box 1181
Harrisburg, PA 17108-1181
You are hereby notified to file a written response to the enclosed ANSWER, NEW
MATTER AND COUNTERCLAIM within twenty (20) days from service hereof or a judgment
may be entered against you.
Respectfully submitted,
14VA ??'-
Karoline Mehalchick, Esquire
Attorney I.D. No.: 87641
Oliver, Price & Rhodes
P.O. Box 240
Clarks Summit, PA 18411
Ph: (570) 585-1200
Fax: (570) 585-5100
Email:km@oprlaw.com
Karoline Mehalchick, Esq.
Attorney I.D. No. 87641
Oliver, Price & Rhodes
1212 South Abington Road, Suite 200
P.O. Box 240
Clarks Summit, PA 18411
PH: 570-585-1200
FAX: 570-585-5100
E-MAIL: k?,,oprlaw.com
RITE AID HDQTRS. CORP.,
Plaintiff
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
VS.
KAY HOME PRODUCTS, INC.,
Defendant
Civil Action No. 10-692 Civil Term
ANSWER, NEW MATTER AND COUNTERCLAIM
OF DEFENDANT, KAY HOME PRODUCTS, INC.
AND NOW COME the Defendant, KAY HOME PRODUCTS, INC., by and through its
counsel, OLIVER, PRICE AND RHODES, and hereby responds to the Complaint filed by the
Plaintiff:
PARTIES
1. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
2. Denied. Kay Home Products is the trade name for an Ohio limited liability company
with its principal place of business at 90 McMillen Road, Antioch, Illinois.
JURISDICTION AND VENUE
3. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
4. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
5. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
RELEVANT FACTS
6. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
7. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
8. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
9. Denied. The allegations of this paragraph constitute conclusions of law which are
therefore deemed denied. By way of further answer, Defendant, after reasonable
investigation, lacks the knowledge sufficient to form a belief as to the allegations
contained in this paragraph and demand strict proof thereof at the time of trial;
therefore, said allegations are denied.
10. Denied. The allegations of this paragraph constitute conclusions of law which are
therefore deemed denied. By way of further answer, Defendant, after reasonable
investigation, lacks the knowledge sufficient to form a belief as to the allegations
contained in this paragraph and demand strict proof thereof at the time of trial;
therefore, said allegations are denied.
11. Denied. The allegations of this paragraph constitute conclusions of law which are
therefore deemed denied. By way of further answer, Defendant, after reasonable
investigation, lacks the knowledge sufficient to form a belief as to the allegations
contained in this paragraph and demand strict proof thereof at the time of trial;
therefore, said allegations are denied.
12. Denied. To the extent that paragraph 12 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
13. Denied. To the extent that paragraph 13 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
14. Denied. To the extent that paragraph 14 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
15. Denied. To the extent that paragraph 15 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
2
characterization of its contents by Plaintiff is denied.
16. Denied. To the extent that paragraph 16 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
17. Denied. To the extent that paragraph 17 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
18. Denied. To the extent that paragraph 18 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
19. Denied. To the extent that paragraph 19 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
20. Denied. To the extent that paragraph 20 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
21. Denied. To the extent that paragraph 21 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
22. Denied. To the extent that paragraph 22 intends to characterize the contents of the
Rite Aid Letter, such document is a written instrument which speaks for itself and
any characterization of its contents by Plaintiff is denied.
23. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
24. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
25. Denied. To the extent that paragraph 25 intends to characterize the contents of the
E-Mail, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
26. Denied. To the extent that paragraph 26 intends to characterize the contents of the
Letter to Young, such document is a written instrument which speaks for itself and
any characterization of its contents by Plaintiff is denied.
27. Denied. To the extent that paragraph 27 intends to characterize the contents of the
E-Mail to Murray, such document is a written instrument which speaks for itself and
3
any characterization of its contents by Plaintiff is denied.
28. Denied. To the extent that paragraph 28 intends to characterize the contents of the
January 6, 2010 letter, such document is a written instrument which speaks for itself
and any characterization of its contents by Plaintiff is denied.
29. Denied. To the extent that paragraph 28 intends to characterize the contents of the
January 20, 2010 e-mail, such document is a written instrument which speaks for
itself and any characterization of its contents by Plaintiff is denied.
30. Denied. It is specifically denied that Kay has refused to respond to Rite Aid's
requests for indemnification.
31. Denied. While Kay has not provided Rite Aid with any funds directly, it did resolve
the California Air Resources Board investigation with regards to the Rite Aid claims.
32. Denied. It is specifically denied that Kay has any responsibility to provide
indemnification to Rite Aid and that it has refused to acknowledge the Rite Aid's
requests. By way of further answer, the allegations of paragraph 32 constitute
conclusions of law and are therefore deemed denied.
COUNTI
33. Defendant realleges each and every allegation contained in Paragraphs 1 through 21
of this Complaint and incorporates them herein by reference thereto.
34. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
35. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
36. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
WHEREFORE, Defendant, Kay Home Products, Inc., demands judgment in its favor,
together with any other relief to which it may be justly entitled.
NEW MATTER
37. Defendant realleges each and every allegation contained in Paragraphs 1 through 36
of this Complaint and incorporates them herein by reference thereto.
38. The Complaint fails to state a claim upon which relief can be granted.
39. This Court lacks jurisdiction over the subject matter of this claim.
4
40. Plaintiff's Complaint is barred by its own actions and/or omissions.
41. Plaintiff has not alleged any facts that would entitle it to any of the relief that it seeks
in its Complaint, namely a declaratory judgment or any other relief.
42. Defendant is not liable to Plaintiff because the conduct of other persons or entities
constitute an intervening and/or superseding cause of the alleged damages to
Plaintiff.
43. If the Plaintiff sustained the damages alleged in its complaint, which damages are
specifically denied, any act or omission on the part of Defendant, which act or
omission is specifically denied, was not a substantial factor in causing said damages.
44. If the Plaintiff sustained the damages alleged in their complaint, which damages are
specifically denied, then such damages are caused in whole or in part, by the failure
of Plaintiff to mitigate such damages.
45. At all times relevant hereto, Defendant acted lawfully and properly.
46. The alleged damages if any, to Plaintiff, are caused by its own negligence,
carelessness, and/or intentional conduct.
47. At all times relevant hereto, Defendant acted in good faith, with a reasonable belief
that its actions were legal and proper.
48. The claims of Plaintiff are barred by the doctrine of contributory negligence.
49. The claims of Plaintiff are barred by the doctrine of comparative negligence.
50. Defendant did not breach any contract or agreement or responsibility to Plaintiff.
51. Plaintiff is not entitled to recovery of attorney fees and costs associated with this
action.
52. Plaintiff's claim is barred by the doctrine of mutuality of obligation.
53. Plaintiff's claim is barred by the doctrine of consideration.
54. Plaintiff's claim is barred because it caused Defendant to enter into the agreement
between the parties under duress and undue influence.
55. Plaintiff has failed to properly mitigate its damages.
56. Plaintiff's claims are barred by the applicable statute of limitations.
WHEREFORE, Defendant, Kay Home Products, Inc., demands judgment in its favor,
together with any other relief to which it may be justly entitled.
5
COUNTERCLAIM
57. Defendant realleges each and every allegation contained in Paragraphs 1 through 56
of this Complaint and incorporates them herein by reference thereto.
58. Plaintiff failed to cooperate with Defendant as required by paragraph 4 of the
Defense and Indemnity Agreement attached to Plaintiff's Complaint as Exhibit A.
59. Pursuant to paragraph 5 of the Defense and Indemnity Agreement, Kay is entitled to
recover all of its attorney's fees and costs associated with this action.
60. WHEREFORE, Defendant, Kay Home Products, Inc., demands judgment in its favor,
together with any other relief to which it may be justly entitled.
Respectfully submitted,
OLIVER, PRICE & RHODES
Kau 944A;6k.„
Karoline Mehalchick
Attorney I.D. No.: 87641
1212 South Abington Road
P.O. Box 240
Clarks Summit, PA 18411
Phone: (570) 585-1200
Fax: (570) 585-5100
Email: km@oprlaw.com
6
VERIFICATION
I, JOHN I MURRAY, MEMBER AND CHIEF EXECUTIVE OFFICER OF AmRUE
INDUSTRIEs, LLC, D/B/A KAY Homl PRODUCTS, verify that the statements made in the foregoing
ANSWER, NEw MATTER AND COUNTERCLAIM, To PLAIN "Is COMPLAINT are true and correct to
the best of my knowledge, information and belief. I understand that false statements herein are
made subject to the penalties of 18 Pa. C.S.A. Section 4904, relating to the unsworn falsification to
authorities.
Daze: /0 Aw*t .2010
Brian P. Downey (PA 59891)
Frederick Alcaro (PA 91555)
PEPPER HAMILTON LLP
100 Market Street, Suite 200
PO Box 1181
Harrisburg, PA 17108-1181
717.255.1155
717.238.0575 (fax)
Attorneys for Plaintiff
Rite Aid Hdqtrs. Corp.
To Plaintiff:
You are hereby notified to file a written
response to the enclosed Preliminary
Objections within twenty (20) days from
service hereof or a judgment may be entered
against you.
RITE AID HDQTRS. CORP.,
Plaintiff,
vs.
KAY HOME PRODUCTS, INC.
Defendant.
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNc§YI VAI'
C-
?
=
NO. 10-692 r° r , r nr
-..
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-urn
o
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CIVIL ACTION - LAW ?- ??1 T ='^
- o-n
PLAINTIFF RITE AID HDQTRS. CORP.'S
PRELIMINARY OBJECTION IN THE NATURE OF DEMURRER
TO KAY HOME PRODUCTS, INC.'S COUNTERCLAIM
Plaintiff Rite Aid Hdqtrs. Corp., by its undersigned attorneys, hereby assert the
following preliminary objection in the nature of a demurrer to Defendant Kay Home Products,
Inc.'s Counterclaim in this matter and in support thereof state as follows:
BACKGROUND
On January 29, 2010, Plaintiff filed its complaint against Defendant,
asserting one count for Declaratory Judgment against Defendant as to Defendant's
responsibilities under the Defense and Indemnity Agreement.
2. On February 25, 2010, Defendant attempted to file pro se its Answer to
Complaint with New Matter and Counterclaim before this Court.
On preliminary objections in the nature of a motion to strike brought by
Rite Aid, on September 14, 2010, this Court struck Kay's first Answer to Complaint with New
Matter and Counterclaim on the grounds that a corporation cannot represent itself pro se under
clear Pennsylvania law.
4. On December 27, 2010, following the entry of appearance of counsel on
behalf of Kay, Kay filed its renewed Answer to Complaint with New Matter and Counterclaim.
See Answer to Complaint with New Matter and Counterclaim, attached hereto as Exhibit A.
5. This pleading includes a four-paragraph Counterclaim against Plaintiff.
See id. at IT 57-60.
6. While Defendant has failed to label its Counterclaim, Defendant appears
to attempt to plead a breach of contract claim against Rite Aid.
7. Defendant's Counterclaim simply alleges that Rite Aid "failed to
cooperate with Defendant as required by paragraph 4 of the Defense and Indemnity Agreement"
and therefore "[p]ursuant to paragraph 5 of the Defense and Indemnity Agreement, Defendant is
entitled to recover all of its attorney's fees and costs associated with this action." See id. at TT
58-59.
8. Defendant neglects to allege any facts concerning. this allegations,
including but not limited to how Rite Aid failed to "cooperate" with Defendant, or even explain
the context of such paragraph.
PRELIMINARY OBJECTION
Objection In The Nature of Demurrer
Based on Legal Insufficiency
9. Plaintiff incorporates paragraphs 1 through 8 above, by reference.
10. Pennsylvania Rule of Civil Procedure 1028(a)(4) permits a party to raise
an objection in the nature of a demurrer where the pleading is legally insufficient.
-2-
11. Defendant's Counterclaim solely alleges that Rite Aid "failed to cooperate
with Defendant as required by paragraph 4 of the Defense and Indemnity Agreement" and
therefore "[p]ursuant to paragraph 5 of the Defense and Indemnity Agreement, Defendant is
entitled to recover all of its attorney's fees and costs associated with this action." See id. at IT
58-59.
12. Defendant has failed to set forth a claim upon which relief may be granted.
13. Pennsylvania law requires a plaintiff, in the context of a breach of contract
action, to plead "the existence of the contract, including its essential terms, (2) a breach of a duty
imposed by the contract and (3) resultant damages." Corestates Bank, N.A. v. Cutillo, 723 A.2d
1053, 1058 (Pa. Super. 1999).
14. "Further, because Pennsylvania is a fact-pleading jurisdiction, a pleading
must not only apprise the opposing party of the asserted claim, `it must also formulate the issues
by summarizing those facts essential to support the claim."' Id. at 1057 (quoting Sevin v.
Kelshaw, 611 A.2d 1232, 1235 (Pa. Super. 1992)). Although not every aspect of the contract
needs to be set forth in complete detail, "every element [of the claim] must be specifically
pleaded." Id. at 1058.
15. A complaint must not only give notice of what the claim is, and the
grounds upon which it rests, "but it must also formulate the issues by summarizing those facts
essential to support the claim." Alpha Tau Omega Fraternity v. Univ. of Pa., 464 A.2d 1349,
1352 (Pa. Super. 1983) (emphasis added).
16. Defendant has failed to set forth any facts in support of its Counterclaim,
including but not limited to how Rite Aid failed to "cooperate" with Defendant, or even explain
the context of such allegation.
-3-
17. Therefore, under Pennsylvania law, this claim must be dismissed.
WHEREFORE, Plaintiff requests that this Court sustain Plaintiff s Preliminary
Objections to Defendant's Counterclaim and dismiss Defendant's Counterclaim with prejudice.
Date: January 7, 2011
Brian P. Downey (PA 59891)
Frederick Alcaro (PA 91555)
PEPPER HAMILTON LLP
Suite 200, 100 Market Street
P.O. Box 1181
Harrisburg, PA 17108-1181
Phone: (717) 255-1155
Fax: (717) 238-0575
Attorneys for Plaintiff
Rite Aid HDQTRS. Corp.
-4-
EXHIBIT
«A99
Oliver, Price & Rhodes
Karoline Mehalebick, Esquire
Attorney 1.1). No. 87(A 1
1212 South Abington Road
P-0 Box 240
Clarks Summit, PA 18411
Ph: 070) 585-1200
Fax:(570)585-5100
Email: kt 'E1!<LPLIdl4S±1111
RITE AID HDQTRS. CORP.,
vs.
Plaintiff
KAY HOME PRODUCTS, INC.,
Defendant
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
Civil Action No. 10-692 Civil Term
NOTICE To PLEAD
TO: Rite Aid Hdqtrs. Corp.
c/o Frederick Alvaro, Esq.
Pepper Hamilton LLP
100 Market Street, Suite 200
Post Office Box 1181.
Harrisburg, PA 17108-1181
You are hereby notified to file a written response to the enclosed ANSWER, New
MATTER AND COUN'rERCLAIM within twenty (20) days from service hereof or a judgment
may be entered against you.
Respectfully submitted,
Karoline Mehalchick, Esquire
Attorney I.D. No.: 87641
Oliver, Price & Rhodes
P.O. Box 240
Clarks Summit, PA 18411
Ph: (570) 585-1200
Fax: (570) 585-5100
Email:km@oprlaw.com
Karoline Mehalchick, Esq.
Attorney V D. No. 87641
Oliver, Price & Rhodes
1212 South Abington Road, Suite 200
P.O. Box 240
Clarks Summit, PA 18411
PH: 570-585-1200
FAX: 570-585-5100
F -MAIL;
ltn't'D LLstn1
RITE AID HDQTRS. CORP.,
vs.
KAY HOME PRODUCTS, INC.,
Denied. Kay Home Products is the trade name for an Ohio limited liability company
with its principal place of business at 90 McMillen Road, Antioch, Illinois.
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
Civil Action No. 10-692 Civil Term
ANSWER, NEW MATTER AND COUNTERCLAIM
OF DEFENDANT, KAY HOME PRODUCTS, INC.
AND NOW COME the Defendant, KAY HOME PRODUCTS, INC., by and through its
counsel, OLIVER, PRICE AND RHODES, and hereby responds to the Complaint filed by the
Plaintiff:
PARTIES
1. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
2
3.
4.
5
Plaintiff
Defendant
JURISDICTION AND VENUE
Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
RELEVANT FACTS
ti. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
7. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
8. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
farm a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
9. Denied. The allegations of this paragraph constitute conclusions of law which are
therefore deemed denied. By way of further answer. Defendant, after reasonable
investigation, lacks the knowledge sufficient to form a belief as to the allegations
contained in this paragraph and demand strict proof thereof at the time of trial;
therefore, said allegations are denied.
10. Denied. The allegations of this paragraph constitute conclusions of law which are
therefore deemed denied. By way of further answer, Defendant, after reasonable
investigation, lacks the knowledge sufficient to form a belief as to the allegations
contained in this paragraph and demand strict proof thereof at the time of trial;
therefore, said allegations are denied.
H. . Denied. The allegations of this paragraph constitute conclusions of law which are
therefore deemed denied. By way of further answer, Defendant, after reasonable
investigation, lacks the knowledge sufficient to form a belief as to the allegations
contained in this paragraph and demand strict proof thereof at the time of trial;
therefore, said allegations are denied.
12. Denied. To the extent that paragraph 12 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied,
13. Denied. To the extent that paragraph 13 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
14. Denied. To the extent that paragraph 14 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
15. Denied. To the extent that paragraph 15 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
2
characterization of its contents by Plaintiff is denied.
16. Denied. To the extent that paragraph 16 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
17. Denied. To the extent that paragraph 17 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
18. Denied. To the extent that paragraph 18 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
19. Denied. To the extent that paragraph 19 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
20. Denied. To the extent that paragraph 20 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
21. Denied. To the extent that paragraph 21 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
22. Denied. To the extent that paragraph 22 intends to characterize the contents of the
Rite Aid Letter, such document is a written instrument which speaks for itself and
any characterization of its contents by Plaintiff is denied.
23. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
24. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
25. Denied. To the extent that paragraph 25 intends to characterize the contents of the
E-Mail, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
26. Denied. To the extent that paragraph 26 intends to characterize the contents of the
Letter to Young, such document is a written instrument which speaks for itself and
any characterization of its contents by Plaintiff is denied.
27. Denied. To the extent that paragraph 27 intends to characterize the contents of the
E-Mail to Murray, such document is a written instrument which speaks for itself and
3
any characterization of its contents by Plaintiff is denied.
28. Denied. To the extent that paragraph 28 intends to characterize the contents of the
January 6, 2010 letter, such document is a written instrument which speaks for itself
and any characterization of its contents by Plaintiff is denied.
29. Denied. To the extent that paragraph 28 intends to characterize the contents of the
January 20, 2010 e-mail, such document is a written instrument which speaks for
itself and any characterization of its contents by Plaintiff is denied.
30. Denied. It is specifically denied that Kay has refused to respond to Rite Aid's
requests for indemnification.
31. Denied. While Kay has not provided Rite Aid with any funds directly, it did resolve
the California Air Resources Board investigation with regards to the Rite Aid claims.
32. Denied. It is specifically denied that Kay has any responsibility to provide
indemnification to Rite Aid and that it has refused to acknowledge the Rite Aid's
requests. By way of further answer, the allegations of paragraph 32 constitute
conclusions of law and are therefore deemed denied.
COUNTI
33. Defendant realleges each and every allegation contained in Paragraphs 1 through 21
of this Complaint and incorporates them herein by reference thereto.
34. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
35. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
36. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
WHEREFORE, Defendant, Kay Home Products, Inc., demands judgment in its favor,
together with any other relief to which it may be justly entitled.
NEw MATTER
37. Defendant realleges each and every allegation contained in Paragraphs l through 36
of this Complaint and incorporates them herein by reference thereto.
38. The Complaint fails to state a claim upon which relief can be granted.
39. This Court lacks jurisdiction over the subject matter of this claim.
4
40. Plaintiffs Complaint is barred by its own actions and/or omissions.
41. Plaintiff has not alleged any facts that would entitle it to any of the relief that it seeks
in its Complaint, namely a declaratory judgment or any other relief.
42. Defendant is not liable to Plaintiff because the conduct of other persons or entities
constitute an intervening and/or superseding cause of the alleged damages to
Plaintiff.
43. If the Plaintiff sustained the damages alleged in its complaint, which damages are
specifically denied, any act or omission on the part of Defendant, which act or
omission is specifically denied, was not a substantial factor in causing said damages.
44. If the Plaintiff' sustained the damages alleged in their complaint, which damages are
specifically denied, then such damages are caused in whole or in part, by the failure
of Plaintiff to mitigate such damages.
45. At all times relevant hereto, Defendant acted lawfully and properly.
46. The alleged damages if any, to Plaintiff, are caused by its own negligence,
carelessness, and/or intentional conduct.
47. At all times relevant hereto, Defendant acted in good faith, with a reasonable belief
that its actions were legal and proper.
48. The claims of Plaintiff are barred by the doctrine of contributory negligence.
49. The claims of Plaintiff are barred by the doctrine of comparative negligence.
50. Defendant did not breach any contract or agreement or responsibility to Plaintiff.
51. Plaintiff is not entitled to recovery of attorney fees and costs associated with this
action.
52. Plaintiff's claim is barred by the doctrine of mutuality of obligation.
53. Plaintiffs claim is barred by the doctrine of consideration.
54. Plaintiff's claim is barred because it caused Defendant to enter into the agreement
between the parties under duress and undue influence.
55. Plaintiff has failed to properly mitigate its damages.
56. Plaintiff's claims are barred by the applicable statute of limitations.
WHEREFORE, Defendant, Kay Home Products, Inc., demands judgment in its favor,
together with any other relief to which it may be justly entitled.
5
COUNTERCLAIM
57. Defendant realleges each and every allegation contained in Paragraphs I through 56
of this Complaint and incorporates them herein by reference thereto.
58. Plaintiff failed to cooperate with Defendant as required by paragraph 4 of the
Defense and Indemnity Agreement attached to Plaintiff's Complaint as Exhibit A.
59. Pursuant to paragraph 5 of the Defense and Indemnity Agreement, Kay is entitled to
recover all of its attorney's fees and costs associated with this action.
60. WHEREFORE, Defendant, Kay Home Products, Inc., demands judgment in its favor,
together with any other relief to which it may be justly entitled.
Respectfully submitted,
OLIVER, PRICE & RHODES
Karoline Mehalchick
Attorney I.D. No.: 87641
1212 South Abington Road
P.O. Box 240
Clarks Summit, PA 18411
Phone: (570) 585-1200
Pax: (570) 585-5100
Email: km(,oprlaw.com
6
VERIFICAnom
1, .1011N .1. MURRAY, MEMBER AND CHIEF EXECUTIVE OFFICER OF AKERUE
1NDUSTRIEs, LLC, D/B/A KAY HOME PRODUCTS, verify that the statements made in the foregoing
ANSwt:.R, NEW MATTER AND COUNTERCLAIM, TO PLAINTIFF'S COMPLAINT are true and correct to
the best of my knowledge, information and belief. I understand that false statements herein are
made subject to the penalties of 18 Pa. C.S.A. Section 4904, relating to the unsworn falsification to
authorities,
A
Date: CIO ij' cFL.. 2010
r ,
]
?fi J. Murray
I
CERTIFICATE O SERVICE
1, KAROLINE MEHALCHICK, ESQUIRE, of Oliver, Price & Rhodes, hereby certify that
on the 24fh day of December, 2010, I served a true and correct copy of the foregoing
ANSWER, CROSS CLAIM AND NEW MATTER OF DEFENDANT, KAY HOME PRODUCTS, INC., TO
PLAINTIFFS' COMPLAINT by placing the same in the United States Mail, First Class Postage
Prepaid, at Clarks Summit, Pennsylvania, addressed as follows:
Frederick Alcaro, Esquire
Pepper Hamilton LLP
100 Market Street, Suite 200
Post Office Box 1181
Harrisburg, PA 17108-1181
K&*4;u md4
Karoline Mehalchick, Esquire
8
CERTIFICATE OF SERVICE
I hereby certify that on January 7, 2011, a copy of the foregoing document was
served by United States mail, first class postage prepaid, addressed as follows:
Karoline Mehalchick
Oliver, Price & Rhodes
1212 South Abington Road
P.O. Box 240
Clarks Summit, PA 18411
Frederick Alcaro
F:IJ
Oliver, Price & Rhodes
Karoline Mehalchick, Esquire
Attorney I.D. No. 87641
1212 South Abington Road
P.O. Box 240
Clarks Summit, PA 18411
Ph: (570) 585-1200
Fax: (570) 585-5100
Email: km,_&onrla%v.com
RITE AID HDQTRS. CORP.,
VS.
Plaintiff
KAY HOME PRODUCTS, INC.,
Defendant
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
Civil Action No. 10-692 Civil Term
NOTICE TO PLEAD
TO: Rite Aid Hdqtrs. Corp.
c/o Frederick Alcaro, Esq.
Pepper Hamilton LLP
100 Market Street, Suite 200
Post Office Box 1181
Harrisburg, PA 17108-1181
You are hereby notified to file a written response to the enclosed ANSWER, NEW
MATTER AND COUNTERCLAIM within twenty (20) days from service hereof or a judgment
may be entered against you.
Respectfully submitted,
Karoline Mehalchick, Esquire
Attorney I.D. No.: 87641
Oliver, Price & Rhodes
P.O. Box 240
Clarks Summit, PA 18411
Ph: (570) 585-1200
Fax: (570) 585-5100
Email:km@oprlaw.com
Karoline Mehalchick, Esq.
Attorney I.D. No. 87641
Oliver, Price & Rhodes
1212 South Abington Road, Suite 200
P.O. Box 240
Clarks Summit, PA 18411
PH: 570-585-1200
FAX: 570-585-5100
E-MAIL: km!a?oprlaw.com
RITE AID HDQTRS. CORP.,
Plaintiff
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY
VS.
KAY HOME PRODUCTS, INC.,
Defendant
Civil Action No. 10-692 Civil Term
ANSWER, NEW MATTER AND COUNTERCLAIM
OF DEFENDANT, KAY HOME PRODUCTS, INC.
AND NOW COME the Defendant, KAY HOME PRODUCTS, INC., by and through its
counsel, OLIVER, PRICE AND RHODES, and hereby responds to the Complaint filed by the
Plaintiff:
PARTIES
1. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
2. Denied. Kay Home Products is the trade name for an Ohio limited liability company
with its principal place of business at 90 McMillen Road, Antioch, Illinois.
JURISDICTION AND VENUE
3. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
4. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
5. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
2
RELEVANT FACTS
6. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
7. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
8. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
9. Denied. The allegations of this paragraph constitute conclusions of law which are
therefore deemed denied. By way of further answer, Defendant, after reasonable
investigation, lacks the knowledge sufficient to form a belief as to the allegations
contained in this paragraph and demand strict proof thereof at the time of trial;
therefore, said allegations are denied.
10. Denied. The allegations of this paragraph constitute conclusions of law which are
therefore deemed denied. By way of further answer, Defendant, after reasonable
investigation, lacks the knowledge sufficient to form a belief as to the allegations
contained in this paragraph and demand strict proof thereof at the time of trial;
therefore, said allegations are denied.
11. Denied. The allegations of this paragraph constitute conclusions of law which are
therefore deemed denied. By way of further answer, Defendant, after reasonable
investigation, lacks the knowledge sufficient to form a belief as to the allegations
contained in this paragraph and demand strict proof thereof at the time of trial;
therefore, said allegations are denied.
12. Denied. To the extent that paragraph 12 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
13. Denied. To the extent that paragraph 13 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
14. Denied. To the extent that paragraph 14 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
15. Denied. To the extent that paragraph 15 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
3
characterization of its contents by Plaintiff is denied.
16. Denied. To the extent that paragraph 16 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
17. Denied. To the extent that paragraph 17 intends to characterize the contents of the
Agreement, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
18. Denied. To the extent that paragraph 18 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
19. Denied. To the extent that paragraph 19 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
20. Denied. To the extent that paragraph 20 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
21. Denied. To the extent that paragraph 21 intends to characterize the contents of the
Letter, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
22. Denied. To the extent that paragraph 22 intends to characterize the contents of the
Rite Aid Letter, such document is a written instrument which speaks for itself and
any characterization of its contents by Plaintiff is denied.
23. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
24. Denied. Defendant, after reasonable investigation, lacks the knowledge sufficient to
form a belief as to the allegations contained in this paragraph and demand strict
proof thereof at the time of trial; therefore, said allegations are denied.
25. Denied. To the extent that paragraph 25 intends to characterize the contents of the
E-Mail, such document is a written instrument which speaks for itself and any
characterization of its contents by Plaintiff is denied.
26. Denied. To the extent that paragraph 26 intends to characterize the contents of the
Letter to Young, such document is a written instrument which speaks for itself and
any characterization of its contents by Plaintiff is denied.
27. Denied. To the extent that paragraph 27 intends to characterize the contents of the
E-Mail to Murray, such document is a written instrument which speaks for itself and
4
any characterization of its contents by Plaintiff is denied.
28. Denied. To the extent that paragraph 28 intends to characterize the contents of the
January 6, 2010 letter, such document is a written instrument which speaks for itself
and any characterization of its contents by Plaintiff is denied.
29. Denied. To the extent that paragraph 28 intends to characterize the contents of the
January 20, 2010 e-mail, such document is a written instrument which speaks for
itself and any characterization of its contents by Plaintiff is denied.
30. Denied. It is specifically denied that Kay has refused to respond to Rite Aid's
requests for indemnification.
31. Denied. While Kay has not provided Rite Aid with any funds directly, it did resolve
the California Air Resources Board investigation with regards to the Rite Aid claims.
32. Denied. It is specifically denied that Kay has any responsibility to provide
indemnification to Rite Aid and that it has refused to acknowledge the Rite Aid's
requests. By way of further answer, the allegations of paragraph 32 constitute
conclusions of law and are therefore deemed denied.
COUNTI
33. Defendant realleges each and every allegation contained in Paragraphs 1 through 21
of this Complaint and incorporates them herein by reference thereto.
34. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
35. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
36. Denied. The allegations of this paragraph constitute conclusions of law and are
therefore deemed denied.
WHEREFORE, Defendant, Kay Home Products, Inc., demands judgment in its favor,
together with any other relief to which it may be justly entitled.
NEW MATTER
37. Defendant realleges each and every allegation contained in Paragraphs 1 through 36
of this Complaint and incorporates them herein by reference thereto.
38. The Complaint fails to state a claim upon which relief can be granted.
39. This Court lacks jurisdiction over the subject matter of this claim.
5
40. Plaintiff's Complaint is barred by its own actions and/or omissions.
41. Plaintiff has not alleged any facts that would entitle it to any of the relief that it seeks
in its Complaint, namely a declaratory judgment or any other relief.
42. Defendant is not liable to Plaintiff because the conduct of other persons or entities
constitute an intervening and/or superseding cause of the alleged damages to
Plaintiff.
43. If the Plaintiff sustained the damages alleged in its complaint, which damages are
specifically denied, any act or omission on the part of Defendant, which act or
omission is specifically denied, was not a substantial factor in causing said damages.
44. If the Plaintiff sustained the damages alleged in their complaint, which damages are
specifically denied, then such damages are caused in whole or in part, by the failure
of Plaintiff to mitigate such damages.
45. At all times relevant hereto, Defendant acted lawfully and properly.
46. The alleged damages if any, to Plaintiff, are caused by its own negligence,
carelessness, and/or intentional conduct.
47. At all times relevant hereto, Defendant acted in good faith, with a reasonable belief
that its actions were legal and proper.
48. The claims of Plaintiff are barred by the doctrine of contributory negligence.
49. The claims of Plaintiff are barred by the doctrine of comparative negligence.
50. Defendant did not breach any contract or agreement or responsibility to Plaintiff.
51. Plaintiff is not entitled to recovery of attorney fees and costs associated with this
action.
52. Plaintiff's claim is barred by the doctrine of mutuality of obligation.
53. Plaintiff's claim is barred by the doctrine of consideration.
54. Plaintiff's claim is barred because it caused Defendant to enter into the agreement
between the parties under duress and undue influence.
55. Plaintiff has failed to properly mitigate its damages.
56. Plaintiff's claims are barred by the applicable statute of limitations.
WHEREFORE, Defendant, Kay Home Products, Inc., demands judgment in its favor,
together with any other relief to which it may be justly entitled.
6
COUNTERCLAIM
57. Defendant realleges each and every allegation contained in Paragraphs 1 through 56
of this Complaint and incorporates them herein by reference thereto.
58. As set forth in Plaintiff's Complaint, the parties entered into a Defense and
Indemnity Agreement (the "Agreement"), which was attached to Plaintiff's
Complaint as Exhibit A, and in which Defendant was referred to as the "Seller".
59. Paragraph 4 of that Agreement states:
Legal Actions. Rite Aid will give the Seller reasonable notice of any
investigations, suits or actions instituted against Rite Aid. Rite Aid
will cooperate with the Seller in connection with the defense or
settlement of such action. Rite Aid shall select and retain counsel at
Seller's expense to defend Rite Aid in any such action.
60. Rite Aid failed to cooperate with Defendant as required by paragraph 4 of the
Defense and Indemnity Agreement attached to Plaintiff's Complaint as Exhibit A. in
direct breach of the Agreement.
61. Specifically, Rite Aid repeatedly attempted to interfere and hamper settlement of the
action before the California Air Resources Board ("CARB").
62. Rather than cooperate with Defendant in resolving the CARB issues, Rite Aid
communicated with Defendant only intermittently, and eventually threatened
Defendant with litigation when Defendant did not agree with an affidavit Rite Aid
wanted him to sign.
63. Even after Defendant reached a successful settlement with CARB, Rite Aid
continued to attempt to interfere and hamper settlement and have refused to
acknowledge the finality of the CARB settlement.
64. Rite Aid's failure to cooperate with Defendant's settlement of the action before the
CARB was a breach of the Agreement between the parties.
65. Pursuant to paragraph 5 of the Defense and Indemnity Agreement, Defendant is
entitled to recover all of its attorney's fees and costs associated with this action.
66. As a result of Rite Aid's breach Defendant has incurred expenses, damages, costs
and attorney fees in connection with its prolonged defense of the action before the
CARB.
7
WHEREFORE, Defendant, Kay Home Products, Inc., demands judgment in its favor
in excess of Fifty Thousand Dollars ($50,000.00), together with any other relief to
which it may be justly entitled.
Respectfully submitted,
OLIVER, PRICE & RHODES
'" A"
Karoline Mehalchick
Attorney I.D. No.: 87641
1212 South Abington Road
P.O. Box 240
Clarks Summit, PA 18411
Phone: (570) 585-1200
Fax: (570) 585-5100
Email: km@oprlaw.com
8
VERIFICATION
I, JOHN J. MURRAY, MEMBER AND CHIEF EXECUTIVE OFFICER of AKERUE
INDVsTRiEs, LLC, D/D/A KAY HOME NoDucn, verify that the statements made in the foregoing
Amended
ANSWER, NEW MATTER AND COUNTERCLAIM, TO PLAINTIFF'S COMPLAINT are true and correct to
the best of my knowledge, information and belief. I understand that false statements herein are
made subject to the penalties of 18 Pa. C.S.A. Section 4904, relating to the unsworn falsification to
authorities.
Date:January 26, 2011
CERTIFICATE OF SERVICE
I, KAROLINE MEHALCHICK, ESQUIRE, of Oliver, Price & Rhodes, hereby certify that
on the 27th day of January, 2011, I served a true and correct copy of the foregoing AMENDED
ANSWER, CROSS CLAIM AND NEW MATTER OF DEFENDANT, KAY HOME PRODUCTS, INC., TO
PLAINTIFFS' COMPLAINT by placing the same in the United States Mail, First Class Postage
Prepaid, at Clarks Summit, Pennsylvania, addressed as follows:
Frederick Alcaro, Esquire
Pepper Hamilton LLP
100 Market Street, Suite 200
Post Office Box 1181
Harrisburg, PA 17108-1181
Karoline Mehalchick, Esquire
9
ORfA
Brian P. Downey (PA 59891)
Frederick Alcaro (PA 91555)
PEPPER HAMILTON LLP
100 Market Street, Suite 200
PO Box 1181
Harrisburg, PA 17108-1181
717.255.1155
717.238.0575 (fax)
` i 3T1iC? 0T, i
JAN! 311 x",13 9:
Attorneys for Plaintiff
Rite Aid Hdatrs. Corn,
RITE AID HDQTRS. CORP.,
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
Plaintiff,
NO. 10-692
vs.
KAY HOME PRODUCTS, INC.
CIVIL ACTION - LAW
Defendant.
PRAECIPE TO REMOVE PLAINTIFF RITE AID HDOTRS CORP.'S
PRELIMINARY OBJECTIONS FROM
FEBRUARY 18, 2011 ARGUMENT COURT LIST
TO THE PROTHONOTARY:
Currently, Plaintiff Rite Aid Hdatrs. Corp.'s Preliminary Objections In The Nature Of
Demurrer To Kay Home Products, Inc.'s Counterclaim, filed on January 10, 2011, has been
scheduled for the February 18, 2011 argument court.
On January 27, 2011, counsel for Defendant filed an amended Answer, New Matter and
Counterclaim. Therefore, kindly remove this matter from the February 18, 2011 argument court
list.
Date: January 28, 2011
r
Brian P. Do ey (PA 59891)
Frederick Alcaro (PA 91555)
PEPPER HAMILTON LLP
Suite 200, 100 Market Street
P.O. Box 1181
Harrisburg, PA 17108-1181
Phone: (717) 255-1155
Fax: (717) 238-0575
Attorneys for Plaintiffs
Rite Aid Hdqtrs. Corp. and
Rite Aid Corporation
-2-
CERTIFICATE OF SERVICE
I hereby certify that on January 28, 2011, a copy of the foregoing document was
served by United States mail, first class postage prepaid, addressed as follows:
Karoline Mehalchick
Oliver, Price & Rhodes
1212 South Abington Road
P.O. Box 240
Clarks Summit, PA 18411
I
Frederick Alcaro
Brian P. Downey (PA 59891)
Frederick Alcaro (PA 91555)
PEPPER HAMILTON LLP
100 Market Street, Suite 200
PO Box 1181
Harrisburg, PA 17108-1181
717.255.1155
717.238.0575 (fax)
Attorneys.for Plaintiff
Rite Aid Hdqtrs. Corp.
RITE AID HDQTRS. CORP.,
vs.
h r ICE
THE PROTHONOTARY
t' 1 I FEB 15 AM 9: 4 7
't"'U BERLAND COUNTY
PENNSYLVANIA
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
NO. 10-692
Plaintiff,
KAY HOME PRODUCTS, INC.
CIVIL ACTION - LAW
Defendant.
RITE AID HDQTRS. CORP.'S ANSWER TO
KAY HOME PRODUCTS, INC.'S
AMENDED NEW MATTER AND COUNTERCLAIM
Plaintiff and Counterclaim Defendant Rite Aid Hdgtrs. Corp. ("Rite Aid"), by and
through its undersigned counsel, files this Answer and New Matter to Defendant Kay Home
Products, Inc.'s ("Kay") Amended New Matter and Counterclaim.
KAY'S NEW MATTER
37. Rite Aid repeats and incorporates paragraphs 1 through 36, above, by
reference.
38. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
-1-
39. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
40. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
41. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
42. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
43. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
44. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
45. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
46. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
47. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
48. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
49. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
-2-
50. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
51. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
52, Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
53. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
54. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
55. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
56. Denied. By way of further answer, the allegations of this paragraph are
conclusions of law to which no response is required and accordingly they are denied.
COUNTERCLAIM
57. Rite Aid repeats and incorporates paragraphs 1 through 56, above, by
reference.
58. The allegations in this paragraph refer to a writing that speaks for itself,
and Rite Aid denies the allegations of this paragraph that are inconsistent therewith.
59. The allegations in this paragraph refer to a writing that speaks for itself,
and Rite Aid denies the allegations of this paragraph that are inconsistent therewith.
60. Denied.
61. Denied.
62. Denied.
-3-
63. Denied. By way of further answer, Defendant's settlement with CARB
failed to take into account relevant time periods
64. Denied. By way of further answer, the allegations of this paragraph
contain conclusions of law to which no response is required.
65. Denied. The allegations in this paragraph refer to a writing that speaks for
itself, and Rite Aid denies the allegations of this paragraph that are inconsistent therewith. By
way of further answer, the allegations of this paragraph contain conclusions of law to which no
response is required.
66. Denied. By way of further answer, the allegations of this paragraph
contain conclusions of law to which no response is required.
WHEREFORE, Rite Aid demands judgment against Kay as follows:
(i) Dismissal of the counterclaim with prejudice;
(ii) An award of attorneys' fees and costs in their favor; and
(iii) Such other relief as the Court deems just and proper.
NEW MATTER OF RITE AID
1. The counterclaim fails to state a claim against Rite Aid, in whole or in
part, upon which relief may be granted.
2. Kay's counterclaims are barred, in whole or in part, by the doctrines of
laches, waiver and unclean hands.
3. Kay's counterclaims are barred because Rite Aid acted in good faith at all
times during the events alleged in this litigation.
-4-
4. Kay's counterclaims are barred, in whole or in part, because they are not
well-grounded in fact and not warranted by existing law or a good faith argument for the
extension, modification or reversal of existing law.
5. The injuries and damages claimed by Kay's, if any, were caused in whole
or in part by the acts or omissions of persons or entities other than Rite Aid.
6. Rite Aid hereby gives notice that it intends to rely upon such other
defenses as may become available or may appear during discovery in this case or otherwise, and
hereby reserves the right to amend this Answer and New Matter to assert any and all such
defenses.
Date: February 14, 2011
Brian P. Downey (PA 59891)
Frederick Alcaro (PA 91555)
PEPPER HAMILTON LLP
100 Market Street, Suite 200
P.O. Box 1181
Harrisburg, PA 17108-1181
717.255.1155
800.420.0618 Fax
downeyb@pepl)erlaw.com
alcarofgpepperlaw. com
Attorneys for Plaintiff
Rite Aid Hdqtrs. Corp,
-5-
VERIFICATION
James J. Comitale signs this Verification on behalf of Rite Aid Hdqtrs. Corp., and
does hereby verify that the foregoing document was prepared with the assistance and advice of
counsel, and in reliance upon counsel's advice; that the document, subject to inadvertent or
undiscovered errors, is based upon and therefore limited by the records and information still in
existence, presently recollected and thus far discovered in preparation of this document; and that
subject to the limitations set forth herein, the statements contained in this document are true and
correct to the best of his knowledge, information and belief. The language of the foregoing
document is that of counsel.
It is understood that the statements herein are made subject to the penalties of
18 Pa. C.S. § 4904 relating to unsworn falsification to authorities.
?C
J ES J. ITALE
Date: February 8, 2011
CERTIFICATE OF SERVICE
I hereby certify that on February 14, 2011, a copy of the foregoing document was
served by United States first class mail and email, addressed as follows:
Karoline Mehalchick
Oliver, Price & Rhodes
1212 South Abington Road
P.O. Box 240
Clarks Summit, PA 18411
Frederick Alcaro