Unpublished Disposition, 935 F.2d 277 (9th Cir. 1991)

MEMORANDUM^* 

Spada Distributing Company and George Spada appeal from a judgment against them in an action for breach of a contract to market potatoes. They argue that the district court erred in placing risk of loss on them, and holding George Spada personally liable for damages assessed against Spada Distributing Company. Don Watts cross-appeals, arguing that he is entitled to attorney's fees and treble damages under the Washington Consumer Protection Act. We affirm in part and reverse in part.

Whether the district court had jurisdiction based on diversity of citizenship was questioned in that the petition for removal failed to allege the principal place of business of Spada Distributing Company. We are satisfied that the state of the record justifies the finding of jurisdiction which is not challenged on appeal.

The district court found that the potatoes were damaged during harvest or delivery, and that under the contract, the distributor was responsible for harvesting and delivering the potatoes. We have reviewed the assignments of error, but find no error in the district court's interpretation of the oral contract.

The district court held that "George Spada is personally liable due to engaging in unfair and deceptive acts and practices in trade or commerce by allowing his corporation to continue in business as a commission merchant and agricultural dealer after its bonds had been canceled." Under Washington state law, Spada is personally liable for damages assessed against the corporation only if the alter ego doctrine applies, see Morgan v. Burks, 93 Wash. 2d 580, 585, 611 P.2d 751, 755 (Wash.1980), or the Washington Consumer Protection Act applies, see Grayson v. Nordic Constr. Co., 92 Wash. 2d 548, 554, 599 P.2d 1271, 1274 (1979).

The alter ego doctrine applies if the corporate form was intentionally used to violate or evade a duty owed to the plaintiff. See Morgan, 93 Wash. 2d at 585-87, 611 P.2d at 755-56. To impose personal liability under the Washington Consumer Protection Act, the plaintiff must show that the dispute had public interest impact. See Hangman Ridge Training Stables, Inc. v. Safeco Title Ins. Co., 105 Wash. 2d 778, 784, 719 P.2d 531, 537 (1986).

There is no basis in the record for the imposition of personal liability on Spada under either the alter ego doctrine or the Washington Consumer Protection Act. We must therefore reverse the conclusion of personal liability.

Because Watts failed to establish public interest impact under the Consumer Protection Act, his cross-appeal seeking attorney's fees and treble damages must fail.

AFFIRMED IN PART; REVERSED IN PART. EACH PARTY SHALL BEAR ITS OWN COSTS.