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CATV Services, Inc. v. Arguss Communication, 04-1448 (2006)

Court: Court of Appeals for the Tenth Circuit Number: 04-1448 Visitors: 11
Filed: Sep. 08, 2006
Latest Update: Feb. 21, 2020
Summary: F I L E D United States Court of Appeals Tenth Circuit UNITED STATES CO URT O F APPEALS September 8, 2006 TENTH CIRCUIT Elisabeth A. Shumaker Clerk of Court CATV SERVICES, IN C., Plaintiff-Appellee, No. 04-1448 v. (D . of Colo.) ARG USS CO M M UNICA TIONS, D. C. No. 02-F-0879 (OES) IN C., Defendant-Appellant. OR D ER AND JUDGM ENT * Before KELLY, PO RFILIO , and TYM KOVICH, Circuit Judges. Defendant-Appellant Arguss Communications hired Plaintiff-Appellee CATV Services to liquidate leftover tele
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                                                                         F I L E D
                                                               United States Court of Appeals
                                                                       Tenth Circuit
                    UNITED STATES CO URT O F APPEALS
                                                                    September 8, 2006
                                 TENTH CIRCUIT                     Elisabeth A. Shumaker
                                                                       Clerk of Court


 CATV SERVICES, IN C.,

               Plaintiff-Appellee,                      No. 04-1448
          v.                                            (D . of Colo.)
 ARG USS CO M M UNICA TIONS,                     D. C. No. 02-F-0879 (OES)
 IN C.,

               Defendant-Appellant.



                            OR D ER AND JUDGM ENT *


Before KELLY, PO RFILIO , and TYM KOVICH, Circuit Judges.


      Defendant-Appellant Arguss Communications hired Plaintiff-Appellee

CATV Services to liquidate leftover telecommunications equipment worth over

$1 million. During the course of performance, Arguss sold some of the

equipment on its own, despite a provision in the agreement that gave CA TV the

exclusive right to sell the equipment. CATV sued Arguss for breach of contract,

claiming that Arguss failed to pay the commission on the sales.




      *
         This order is not binding precedent, except under the doctrines of law of
the case, res judicata, and collateral estoppel. The court generally disfavors the
citation of orders; nevertheless, an order may be cited under the terms and
conditions of 10th Cir. R. 36.3.
      The case was tried to a jury, which found in favor of CATV on the primary

breach of contract claim. During trial, the district court resolved three legal

issues against Arguss: (1) a motion for judgment as a matter of law on the claims

in CATV’s favor, (2) a jury instruction on contract formation, and (3) a motion

for a new trial. Arguss appeals these three rulings, but we AFFIRM .

                                   I. Background

      Because this appeal comes to us after a jury verdict below, we state the

facts in the light most favorable to the jury’s decision. See, e.g., M acsenti v.

Becker, 
237 F.3d 1223
, 1242 (10th Cir. 2001); United Phosphorus, Ltd. v.

M idland Fumigant, Inc., 
205 F.3d 1219
, 1226 (10th Cir. 2000).

      Arguss is a telecommunications contractor. In 1998, Arguss contracted

with a predecessor of AT& T Broadband (“AT& T”) to help with a

telecom munications project A T&T was undertaking near Portland, Oregon. A s

part of this project, Arguss purchased equipment, using funds advanced by

AT& T. By August 2000, however, AT& T decided to discontinue the project, so

A rguss no longer needed a large quantity of unused equipment. Because A T& T

had advanced the funds to purchase the equipment in the first place, Arguss

wanted AT& T to take back the unused equipment. AT& T, on the other hand,

wanted Arguss to sell it.

      In the past, AT& T had used a company called CATV Services to resell

equipment from prior projects and suggested Arguss hire CATV to sell the unused

                                          -2-
equipment here. CATV was a telecommunications equipment broker. For years it

had been hired by telecommunications contractors to resell used and new

telecommunications equipment. CATV’s customary practice was to work with

the owner of the goods to prepare an inventory that would “define[] the

equipment that [CATV would] have a right to sell on an exclusive basis.” R. at

749–50. This inventory was important because it would be the basis of CATV’s

commission. CATV would then prepare the goods for sale, ship them to

purchasers, collect the proceeds, and then remit 60% to the client within thirty

days, keeping a 40% commission. CATV typically operated on an exclusive

basis, wherein it, not the equipment owner, would sell the goods.

      Based on AT& T’s recommendation, Arguss decided to explore the

possibility of working with CATV. The key players in the contract negotiations

were Richard Richmond, president of CATV; Steve Burrows, Vice President of

Arguss; and Randy Pierce, president of a construction company ow ned by Arguss.

      Contract negotiations began in February 2001 and continued through April.

At the outset of negotiations, Richmond explained to Burrows how C ATV

typically operated. Arguss raised several concerns, which were resolved during

the negotiation process. Primarily, Arguss was concerned with the commission

and the time for payment. Because Arguss’s equipment was all new, CA TV

agreed to sell it at a 30% commission rather than its standard 40% . Also, CA TV

agreed to remit the balance w ithin fifteen, rather than thirty, days.

                                          -3-
      Another big concern for Arguss was the term of performance. Arguss was

paying thousands of dollars per month to rent space in Portland to warehouse the

equipment. When Pierce and Burrows asked how quickly CATV could liquidate

the goods, Richmond assured them it would probably take thirty to forty-five

days. In the event that liquidation extended beyond that period, Richmond

promised to ship the unsold equipment to his warehouse in Florida, where he

would continue trying to sell the equipment. At trial, Burrows testified that this

was his understanding as well— CATV “would take [any equipment that was not

sold in the 30 to 45 days] into [its] warehouse and sell it from there.” R. at 619.

      As negotiations proceeded, the parties began to prepare for performance.

On M arch 4, 2001, CATV employee Ross Hunter traveled to the Portland

warehouse to assess the equipment CATV could end up selling. A month later, on

April 4 or 5, Richmond advised Arguss he would send an inventory team to

Portland the following M onday, April 9. Pierce testified that he would not have

allowed workers on site if a deal had not been struck, and Burrows testified at one

point that CATV and Arguss had reached a verbal agreement by this time.

Richmond, however, testified that he sent the inventory team because he was

confident that they would reach an agreement, although the terms had not yet

been finalized. Burrows himself testified that as of April 4, they “had a verbal

agreement where we were trying to go with this,” but “the deal wasn’t completed

by any stretch of the imagination at this point.” R. at 573.

                                          -4-
      On April 9 or 10, Richmond, Burrows, and Pierce finalized the agreement

during a three-way telephone conversation. By that time, both parties agreed that

a deal had been reached. However, one thing remained— Richmond told them he

would send a one-page document, putting in writing the final terms of the deal.

Pierce and Burrows said this was not a problem.

      Richmond emailed the document to both Burrows and Pierce on April 11.

Although Burrows acknowledged that he received the email, he did not “really

recall” seeing the attached document. R. at 578. He claimed he probably did not

pay much attention to it because it was prepared for Pierce’s signature. Pierce

acknowledged that he saw the email on his computer screen and knew it was from

Richmond but insisted that he never opened the email, despite the fact that he

knew Richmond would be sending a one-page document reflecting their

agreement.

      Later that day Richmond called Pierce to discuss the project. In that

conversation, he told Pierce he “needed to execute the document and have it

returned.” R. at 764. Pierce responded, “I’ve looked it over. I don’t have any

problem. I’ll get it signed and get it back to you.” R. at 764. Richmond

testified, “O nce M r. Pierce said he was going to sign and return the document, it

was a done deal for me,” even though he would never receive a signed copy of the

contract. R. at 765.




                                         -5-
      The document attached to the email was entitled simply “Brokerage Sales

Agreement.” Richmond testified that this contract used the same boilerplate

language as in all CATV contracts. Unlike CATV’s other contracts, however, this

document had been modified to include a 70-30 split of any proceeds (rather than

the ususal 60-40 split), which would be remitted within fifteen days (rather than

the usual thirty days). The contract further stated that the agreement was to run

from April 15, 2001, through October 15, 2001. M ost critical to this lawsuit, the

contract included an “Exclusivity” clause, which stated: “CATV Services, Inc.,

for the term of this agreement has the exclusive right to market the materials

defined as ‘included’ in [the inventory spreadsheet].” R. at 1480 (emphasis

added).

      A. M ediaCom Sale

      From the outset, however, the course of performance was troubled. The

first problem involved a sale of fiberoptic cable to a company called M ediaCom.

In M ay 2001, Richmond went to New York to sell fiberoptic cable. Eager to

make a sale, Richmond called Burrows to make sure they would be able to ship

the goods. Based on Burrows’s affirmative reply, Richmond completed the sale.

Subsequently, Burrows told Richmond that CATV was entitled only to the

difference betw een the selling price of the cable and Arguss’s purchase price. A t

the time, cable had been in demand and was selling for 130–150% of its original




                                         -6-
value, so if CATV sold it at that rate, it could remit 100% of the original value to

Arguss and still take its standard commission.

      Unfortunately, before Arguss made this demand, Richmond had already

agreed to sell the cable for less than the premium price. Because he had already

promised the cable to M ediaC om, Richmond was forced to ship the equipment to

protect his credibility, and to do this, he had to promise to pay Arguss full value,

rather than its usual 70% .

      B. CableC om Sale

      Another transaction that caused problems was a sale that Arguss negotiated

with a company called CableCom. Arguss had been negotiating this sale before

hiring CATV to resell the equipment, although the sale w as not completed until

M ay 8, 2001. By the time the sale was completed, however, CATV had

possession of the warehouse and equipment, so it inventoried, packaged, and

marked the goods but did not pay freight. In this case, CableCom paid Arguss

directly, and A rguss did not pay any commission to CATV.

      C. AT& T Sale

      For several months, CATV continued to liquidate the goods, but by August,

over 70% of the equipment remained at the warehouse. During this period,

Arguss had continued negotiations with A T& T, which finally agreed to purchase

the remaining equipment from Arguss. To facilitate the sale, Arguss needed

information from CATV about the status of the Portland warehouse and the

                                          -7-
equipment because CATV had control of the warehouse. Richmond said he was

“running around in circles” to get the information Arguss needed to make the

sale, and he told Arguss that he would claim a commission on any sale to AT& T.

R. at 941.

      On August 28, Richmond informed Arguss that the equipment was ready

for shipment to AT& T and that CATV was awaiting shipping instructions.

However, a few days later, Arguss evicted CATV from the Portland warehouse,

so CATV was unable to ship the equipment to AT& T. Arguss completed the sale

to A T& T but refused to give any commission to CATV.

                                     *****

      Based on these dealings, CATV sued A rguss for breach of contract. Arguss

raised several counterclaims, and the case was tried to a jury. Arguss requested

various instructions on contract formation, which the court refused to give. In the

end, the jury concluded that Arguss did not owe commission on the CableCom

sale, but it did owe commission on the M ediaC om and AT& T sales. After trial,

Arguss moved for judgment as a matter of law and for a new trial. Both motions

were denied, and this appeal followed.

                                   II. Analysis

      Arguss raises three arguments on appeal. First, it claims it was entitled to

judgment as a matter of law. Second, it claims the district court erred by refusing

to give requested jury instructions regarding contract formation. Finally, it claims

                                         -8-
that evidence of jury confusion entitled it to a new trial. W e reject each claim in

turn.

        A. Judgm ent as a M atter of Law

              1. Standard of Review

        W e review de novo a motion for judgment as a matter of law, applying the

same standard as the district court, and drawing all reasonable inferences in favor

of the nonmoving party. M iller v. Auto. Club of N.M ., Inc., 
420 F.3d 1098
, 1131

(10th Cir. 2005). “Judgment as a matter of law is only appropriate w hen ‘a party

has been fully heard on an issue and there is no legally sufficient evidentiary

basis for a reasonable jury to find for that party on that issue.’” 
Id. (quoting Fed.
R. Civ. P. 50(a)(1)). “Thus, a court may grant the motion only if the evidence

points but one way and is susceptible to no reasonable inferences which may

support the opposing party’s position.” 
Id. (citations and
internal quotation marks

omitted). Put otherwise, we ask, “Is there evidence in the record upon which the

jury could have properly relied in returning a verdict for the nonmoving party?”

Klein v. Grynberg, 
44 F.3d 1497
, 1506 (10th Cir. 1995). “A verdict is proper

only if supported by more than a scintilla of evidence.” 
Id. 2. Contract
Formation

        At the heart of this case is the question of contract formation. W hen did

the parties reach an agreement, and what were the terms of that agreement?

Arguss insists that the parties’ failure to agree on three material terms (necessity

                                          -9-
of a written contract, term of performance, and exclusivity) precluded the

formation of a contract as a matter of law. To the extent the parties reached an

agreement, Arguss claims they did so verbally, prior to April 11, when Richmond

sent Pierce the Brokerage Sales Agreement. Because the question of timing is

necessary to a discussion of the other issues, we begin there.

      The evidence to establish the precise moment of contract formation was

hotly disputed by the parties. For example, at one point Burrows testified that

they had reached a verbal agreement on April 4 or 5, when Richmond said he was

sending a team over to the warehouse. At another point, however, he testified

that by April 4, the parties “had a verbal agreement where we were trying to go

with this,” but “the deal wasn’t completed by any stretch of the imagination at

this point.” R. at 573.

      In any event, the evidence supports a conclusion that the parties did not

reach a final agreement until Pierce accepted the terms Richmond sent him on

April 11. It was undisputed that a day or two earlier, Richmond had informed

Pierce and Burrows that a one-page, written agreement would follow. This

agreement did follow, in the form of the Brokerage Sales Agreement sent via

email on April 11. Both knew the document was coming, both admitted seeing

the email, but both denied having paid any attention to the contract.

      That same day, Richmond told Pierce that they “needed to execute the

document and have it returned.” R. at 764. Pierce responded, “I’ve looked it

                                        -10-
over. I don’t have any problem. I’ll get it signed and get it back to you.” R. at

764. Richmond testified, “O nce M r. Pierce said he w as going to sign and return

the document, it was a done deal for me,” even though he would never receive a

signed copy of the contract. R. at 765. Although these facts are not undisputed, a

jury could have relied on this evidence to conclude that the parties finally reached

an agreement at that time.

      This view of the record obviates Arguss’s claim that the parties could not

be bound by a writing that follow ed an earlier, verbal agreement because, as a

matter of fact, the agreement was not entered until the terms in the draft

agreement were accepted. It also eliminates the need to consider how the draft

agreem ent might have served as an offer to modify the contract. Under this view ,

there was no agreement until Pierce and Richmond agreed over the phone that the

terms in the Brokerage Sales Agreement were acceptable.

             3. Necessity of a Signed, Written Agreement

      Arguss challenges this view on legal grounds, arguing that the undisputed

facts of formation were so deficient that a binding agreement was never reached.

In the first of these formation arguments, Arguss claims a verbal agreement was

insufficient to bind the parties because Richmond manifested an intention not to

be bound until a written document was executed. See, e.g., Club Eden Roc, Inc.

v. Tripmasters, Inc., 
471 So. 2d 1322
, 1324 (Fla. Dist. Ct. App. 1985) (“W here

the parties intend that there will be no binding contract until the negotiations are

                                         -11-
reduced to a formal writing, there is no contract until that time.”); Am. Web Press,

Inc. v. Harris Corp., 
596 F. Supp. 1089
, 1092 (D. Colo. 1983) (holding that where

one party evidenced its intention to be bound only upon execution of a formal

writing, a signed document was a condition precedent to contract formation).

      W e need not address the significance of Arguss’s authority because the

argument fails on factual grounds. The only evidence Arguss cites to support its

claim is Richmond’s statement to Pierce that, “regarding the contract, we need to

get that signed and get it back to me.” R. at 881. This statement, however, does

not express intent to be bound only by a written agreement. To the contrary,

Richmond testified that he believed the parties had made a verbal deal to work

together. M oreover, as noted above, the jury could have relied on Richm ond’s

testimony that “[o]nce M r. Pierce said he was going to sign and return the

document, it was a done deal for me.” R. at 765. The jury could have concluded

the signature was a mere formality in the shadow of an oral agreement to be

bound by the terms in the document.

      Perhaps the most important evidence of the parties’ intent is the fact that

both parties began performing on the contract in the absence of a written

agreement. The fact that Richmond began performing based on an oral promise

rather than waiting for a signed document would allow a jury to conclude it was

not necessary to reduce the agreement to writing. Accordingly, a reasonable jury




                                        -12-
could have properly found that neither party intended to be bound only by a

signed writing.

             4. Term of Performance

      Arguss’s remaining arguments dealing with contract formation rest on the

principle that “[w]hen there is no mutual assent to a material term of a contract,

rescission is the proper remedy.” Brush Creek Airport, L.L.C. v. Avion Park,

L.L.C., 
57 P.3d 738
, 745 (Colo. App. 2002) (citing Bejmuk v. Russell, 
734 P.2d 122
(Colo. App. 1986)). Specifically, Arguss argues that the term of performance

and exclusivity were material terms for which there was no meeting of the minds

and, therefore, no contract. However, the record contains sufficient evidence

upon which a reasonable jury could have found a meeting of the minds on these

points. W e first address the term of performance.

      The record is undisputed that Pierce and Burrows wanted the goods to be

liquidated within thirty days and that Richmond emphatically stated his belief that

they could liquidate the goods within thirty to forty-five days. Notwithstanding

Arguss’s initial preference, a jury could have found that through the course of

negotiations, the parties agreed to a longer term. M ost importantly, the Brokerage

Sales Agreement made clear that the contract was for six months. Regardless of

any preference for a shorter term, Pierce’s assent to the terms of the agreement

included assent to the six-month term.




                                         -13-
      Additionally, the jury heard Burrows and Pierce testify that the liquidation

could take longer than thirty days. Specifically, Burrows told the jury that any

equipment that “w asn’t sold in the 30 to 45 days” w ould be taken to CATV’s

warehouse and sold from there. R. at 619. It would be natural for the jury to

conclude that the marketing relationship w ould continue until the goods were

liquidated, but if any goods remained past thirty days, Richmond w ould be

responsible for marketing them from his Florida warehouse. 1

      Based on these facts, a jury could reasonably conclude that the parties

agreed to a six-month term.

             5. Agreement as to Exclusivity

      Arguss further claims there was no binding agreement because the parties

did not reach a meeting of the minds as to exclusivity. In support of this

argument, Arguss cites cases such as Iraola & CIA., S.A. v. Kimberly-Clark

Corp., 
325 F.3d 1274
(11th Cir. 2003), which held at summary judgment that an

exclusivity clause was void for lack of a meeting of the minds where plaintiff

witnesses testified inconsistently as to what discussions had transpired, and

defense witnesses testified they would not have entered into the exclusivity clause

at issue. Arguss emphasizes that the clause here was never discussed, and



      1
        Although the liquidation was not completed within this time frame, the
record reflects that the parties agreed it was not economical to ship the unsold
equipment to Florida, so the parties agreed to keep the equipment in the Portland
warehouse, and CATV would pay half the rent.

                                        -14-
Burrows and Pierce both testified they never agreed to such a clause and would

never have done so.

      The jury, however, was not obligated to accept this testimony, and other

record evidence supports a contrary view. Richmond testified CATV had

exclusive rights to sell the goods. Pierce accepted the terms of the draft

agreement, which gave CATV “the exclusive right to market the materials

defined” in the joint inventory. R. at 764, 1480. In contrast to Iraola, a jury

could rely on this fact to conclude that Pierce and Burrows overstated their

position and that Pierce did, in fact, accept the exclusivity provision. Indeed, the

jury likely disbelieved Pierce’s testimony that he never opened the email

containing the Brokerage Sales Agreement, especially when he knew a draft

agreement was forthcoming. Under this view of the evidence, the jury would

have concluded Arguss entered the agreement knowing an exclusivity clause was

in place. It may be that the clause was ambiguous, as discussed below, but on

this record, a jury could properly conclude that the parties agreed to be bound by

this language.

      Other aspects of the agreement, which are not in dispute, also support this

view. First, for example, the agreement states: “The proceeds received from the

sales of excess equipment will be divided on a Seventy/Thirty percent basis”

without regard to who consummated the sale. R. at 1480. The contract also made

clear that CATV “will be solely responsible for any testing and/or repair costs

                                         -15-
deemed necessary by the Broker” and “will absorb all costs relating to the

shipment and sale of all materials.” 
Id. This clause
does not distinguish between

goods sold by Arguss and goods sold by CATV. If CATV was to be liable for all

costs associated with the sales, it is reasonable to conclude it was entitled to all

commissions associated w ith the sales. 2

      Second, the record supports a view that Arguss knew about the exclusivity

requirement before the Brokerage Sales Agreement was sent. Several aspects of

the trial testimony emphasized that this was an exclusive process. All witnesses

agreed that the verified inventory was critical because it specified the scope of

what CATV could sell for a commission. Other w itnesses w ho had worked with

CATV in the past confirmed that in their prior dealings, only CATV would sell

the equipment on that inventory. It was undisputed that from the outset,

Richmond explained the process to Burrows, and Burrows himself testified that

he was familiar with the usual process. From this evidence, a jury could properly

conclude that Arguss knew enough about the process to realize that CA TV

expected to sell the goods on an exclusive basis.




      2
         Indeed, the costs of marketing the equipment w ere not insignificant.
Richmond explained that marketing was a costly, involved process. CATV would
purchase magazine advertisements and create an interactive CD that could be
distributed to potential customers. Richm ond testified, “I obviously wouldn’t
produce something of this nature with the expense incurred by my corporation
had I believed the material could have simply been removed from my ability to
sell it.” R. at 861.

                                            -16-
      Finally, the course of conduct suggested a mutual understanding that

CATV’s right to sell was exclusive of Arguss. For one thing, Arguss forwarded

to CA TV the only inquiry it received. 3 During the course of performance, CA TV

had sole access to the warehouse and the inventory. Arguss could not have

performed any sale it made without going through CATV. Indeed, in the final

moments of the relationship, Arguss relied on CATV to provide it information

about the goods to facilitate the sale back to AT& T.

      In light of the Brokerage Sales Agreement, the evidence that Arguss knew

how CATV operated, and the course of performance on the contract, a jury could

properly conclude that Arguss understood the agreement gave CA TV an exclusive

right to sell the equipment.

             6. Exclusivity and Ambiguity

      In addition to these questions challenging contract formation, Arguss raises

two issues that go to contract interpretation. It first argues that if the exclusivity

provision applies, it should have been construed against the drafter, CATV,

because it was ambiguous. Under this reading, the provision would mean that

A rguss could not hire other brokers, not that Arguss itself could not sell its own

goods. W hile Arguss is right as a matter of contract interpretation, the




      3
       Only one purchaser contacted Arguss about purchasing equipment, and it
was undisputed at trial that Arguss directed this buyer to CATV to handle the
sale.

                                         -17-
significance of the provision was an issue of fact that was properly resolved by

the jury.

       The fact that the contract was ambiguous does not mean we must accept

Arguss’s interpretation. It is true that ambiguities should be resolved against the

drafter. Holiday Hom es of St. John, Inc. v. Lockhart, 
678 F.2d 1176
, 1186 (3d

Cir. 1982); see also Nicholas v. Bursley, 
119 So. 2d 722
, 728 (Fla. Dist. Ct. App.

1960) (“[I]t is a general rule that a contract will be construed against the party

who drew it or chose the language and any ambiguity will be construed strongly

against the party making use of such language.”). But from this legal principle it

does not follow as a matter of law that the term cannot mean what the drafter says

it means: “the interpretation of the terms of a particular contract is, being a matter

of fact, primarily within the province of the district court.” Holiday 
Homes, 678 F.2d at 1183
. W e have likewise stated, “once a contract is determined to be

ambiguous, the meaning of its terms is generally an issue of fact to be determined

in the same manner as other disputed factual issues.” Anderson v. Eby, 
998 F.2d 858
, 865 (10th Cir. 1993) (applying Colorado law).

       Here, the jury heard testimony that would allow it to find that the parties

understood Arguss would not have the right to sell the equipment on the joint

inventory. The same evidence that supports a meeting of the minds on this issue

supports a finding that both parties understood that this provision gave CA TV an

exclusive right to sell the equipment, even to the exclusion of Arguss itself.

                                         -18-
            7. Applicability of Contract to Sale of Fiberoptic Cable

      Arguss’s final breach of contract claim regards the sale of fiberoptic cable

to M ediaCom. Arguss claims this cable was different from the other items CA TV

was selling, so CATV owed 100% of the value of the cable, rather than the usual

70% . Because there was no contractual basis for distinguishing cable from the

rest of the inventory, a reasonable jury could properly conclude that CATV was

entitled to a 30% commission.

      Arguss claims it informed CATV during the course of negotiations that

since fiberoptic cable w as selling for a premium, CATV was required to remit

100% of the cable’s value. Around that time, cable was selling for rates as high

as 130–150% of its value. At these rates, CATV should have been able to remit

100% of the value and still receive its usual commission.

      The problem w ith Arguss’s logic is that it is not supported by the

Brokerage Sales Agreement, which specified that all proceeds w ould be split

70/30. Arguss’s claim would bear out only if fiberoptic cable was not part of the

verified inventory, a point Arguss has never maintained. To the contrary, Arguss

admits the cable was stored at the same w arehouse where CATV had exclusive

control. Nothing in the record distinguishes fiberoptic cable from any other

goods in the inventory.

      Arguss also maintains that Richmond knew before he sold the cable that it

was different from the rest of the inventory. Richmond squarely rejected this

                                        -19-
view, testifying that he learned about Arguss’s demands only after he had already

promised to sell the cable to M ediaCom at the going rate. He testified that he

only acquiesced to Arguss’s demand to remit 100% of the value because he had

already promised the cable to M ediaC om at a certain price and had to maintain

the business relationship. Richmond w ent forward with the deal, not because he

agreed to the terms, but because he had already committed to M ediaC om and his

reputation was on the line.

      On this record, a reasonable jury could find that CATV acquiesced to remit

the full value of the cable only because it believed it had no other choice,

although it was not contractually obligated to do so.

                                      *****

      For these reasons, we conclude the district court did not err in denying

Arguss’s motion for judgment as a matter of law. A reasonable jury could have

concluded there was no meeting of the minds until Pierce told Richmond the

Brokerage Sales Agreement was acceptable. Such agreement would encompass

acceptance of all the document’s terms, including exclusivity and term of

performance, and could begin without a signed writing. Because nothing in the

document distinguished fiberoptic cable from other goods, proceeds from the sale

to M ediaCom should have been distributed at the contract rate. Accordingly, w e

affirm.

      B. Jury Instructions

                                         -20-
      Arguss next claims the district court erroneously refused to instruct the jury

on contract formation principles by denying four of its requested instructions. W e

find the instructions as a whole to be adequate and affirm on this issue.

      W e review the failure to tender a proposed jury instruction for abuse of

discretion, and review de novo “whether the instructions as a whole adequately

apprised the jury of the issues and the governing law.” United States v. Wolny,

133 F.3d 758
, 765 (10th Cir. 1998). “Even if the district court erred, we will

affirm as long as the error is harmless in the context of the trial as a whole.”

World Wide Ass’n of Specialty Programs v. Pure, Inc., 
450 F.3d 1132
, 1139 (10th

Cir. 2006). “The error is harmless when the erroneous instruction could not have

changed the result of the case.” Lusby v. T.G.&Y. Stores, Inc., 
796 F.2d 1307
,

1310 (10th Cir. 1986).

      Here, the district court refused to give Arguss’s Proposed Instructions

17–20. These instructions would have taught the jury about offer, acceptance,

consideration, and mutual agreement to specified terms. For the most part, this

information was not particularly technical and comported with the common usage

of these notions. Proposed Instruction 17 would have instructed jurors that

“[e]ach party to the contract must have understood and agreed to the essential

terms of the claimed contract.” R. at 104. Proposed Instruction 20 would have

told the jury, “W hen parties to a contract attach different meanings to a material




                                         -21-
term of the contract, no meeting of the minds has occurred, and there is no valid

contract.” R. at 107.

      Instead, the district court gave the following guidance in Instruction 12:

      In order for the plaintiff to establish its claim of breach of contract, it
      has the burden of proving the following essential elements by a
      preponderance of the evidence:

             1. The defendant entered into a contract with the plaintiff to sell
             equipment owned by the defendant in Portland, Oregon, and this
             contract (1) gave the plaintiff the exclusive right to sell the
             equipment, (2) provided for a division of sale proceeds 70
             percent to the defendant and 30 percent to the plaintiff in all
             cases, regardless of who sold the equipment, and (3) required the
             plaintiff to pay the costs of performing an inventory and
             shipping;

             2. The defendant failed to honor the contract terms set forth
             above; and

             3. The plaintiff substantially performed its part of the contract
             or the plaintiff was excused from performance.

R. at 170.

      It may be that the court did not walk the jurors through contract formation

step by step. However, the specific findings required by Instruction 12 ensured

that the jury would find the necessary offer, acceptance, and consideration.

Arguss, moreover, did not object to Instruction 2, which told the jury an

“agreement” had been reached, and that Arguss “asserts that the parties entered

into an oral agreement that did not contain the terms that the plaintiff claims.”

Instruction 13 also told the jury that it could look at the course of conduct

between the parties in determining the meaning of the contract.



                                         -22-
      Arguss argues that the parties failed to agree on three material terms:

(1) necessity of a writing, (2) term of performance, and (3) exclusivity. We

disagree. For example, Instruction 12 adequately apprised the jury of the need to

find an agreement (or meeting of the minds) on the key terms of the contract, and

the trial testimony exhaustively debated these points. The jury resolved the

debate over the contract terms in favor of CATV. W hile perhaps additional

instructions could have been helpful, we look to the instructions “as a whole,” and

as long as the instruction “adequately states the law, the refusal to give a

particular instruction is not an abuse of discretion.” M cKenzie v. Benton, 
388 F.3d 1342
, 1348 (10th Cir. 2004).

      It is true that Instruction 12 does not specifically require the jury to find a

meeting of the minds on whether the contract had to be reduced to a signed

writing, or how long CATV had to perform. But any omission in this regard is

harmless because an adverse finding on these issues was inherent in an adverse

finding on exclusivity. The primary evidence that would support a finding of

exclusivity was the Brokerage Sales Agreement. Thus, a finding of exclusivity

entails a finding that the parties agreed to the terms of the draft agreement, which

includes a finding of a six-month term and an intent to be bound in the absence of

a signed w riting. In this way, any error was harmless.

      C. M otion for a New Trial

      Arguss’s final argument is that the district court erred in denying its motion

for a new trial. In general, such a ruling is discretionary and should only be


                                         -23-
reversed where “the trial court made a clear error of judgment or exceeded the

bounds of permissible choice in the circumstances.” Weese v. Schukman, 
98 F.3d 542
, 549 (10th Cir. 1996). However, where a jury verdict “is inconsistent,

indicating either confusion or abuse on the jury’s part, a motion for a new trial is

not discretionary and a new trial must be granted.” Global Van Lines, Inc. v.

Nebeker, 
541 F.2d 865
, 868 (10th Cir. 1976). Similarly, a new trial is appropriate

where “it is patent from the instructions that the jury’s award disregards the

court’s clear direction.” Chicago, R. I. & P. R. Co. v. Speth, 
404 F.2d 291
, 295

n.4 (8th Cir. 1968).

      Arguss makes three points that it claims require a new trial. First, it claims

the verdict was inconsistent. On the one hand, the jury found in favor of CA TV

on the AT& T sale (which entailed a finding of exclusivity) and ruled in favor of

Arguss on the CableCom sale (which presumably entailed a finding of non-

exclusivity).

      But this is not the only reasonable view of the facts. The negotiations of

this arrangement occurred before the agreement was formed. The record also

establishes that CATV was obligated to pay for shipping in order to receive the

comm ission, and it was undisputed at trial that CATV did not pay for shipping on

the CableCom sale. This fact could have been a basis for the jury to find that

CATV was not obligated to pay commission on the CableCom transaction.

      In response to this analysis, Arguss points out that failure to pay shipping

costs does not resolve the inconsistency because CATV did not pay shipping costs


                                         -24-
on the AT& T sale either. However, prior to that sale, Arguss had forced CA TV

out of the warehouse, preventing it from performing under the contract, which by

its terms continued through October 15, 2001. On these facts, we cannot find that

the verdict w as so inconsistent as to require the district court to exercise its

discretion to grant a new trial.

      Second, Arguss claims that jury polling made clear the jury was confused.

W hen the jury was polled, one juror asked, “Yes or no. One word?” R. at 1214.

The court told him he had to choose, and the juror said, “Yes.” 
Id. Arguss argues
that this colloquy demonstrates the juror’s reservation about the jury verdict.

However, if the juror had reservations at some point, we can only assume he

resolved them before affirming the verdict to the court.

      Finally, Arguss claims the jury ignored Instruction 13 4 and the “undisputed

and unimpeached testimony . . . that CATV and Arguss did not in any way

discuss the exclusivity clause at issue, and that Arguss never agreed to that clause

and, indeed, would not have agreed to that clause.” Aplt. Br. at 55. W e have


      4
          This instruction reads as follow s:

      The statements or conduct of the parties before any dispute arose
      between them is an indication of w hat the parties intended at the time
      that the contract was formed. To determine what the parties intended
      the terms of the contract to mean, you may also consider the parties’
      negotiations of the contract, any earlier dealings between the parties,
      any reasonable expectations the parties may have had because of the
      promises or conduct of the other party, and any other facts and
      circumstances that existed at the time that the contract was formed.

R. at 199.


                                           -25-
already explained how the jury could have viewed the testimony regarding the

negotiations and contract formation consistent with its verdict. Because none of

these reasons required the district court to grant the motion for a new trial, we

cannot say the district court abused its discretion in denying the motion.

                                  III. Conclusion

      For these reasons, we AFFIRM .

                                                     Entered for the Court.


                                                     Timothy M . Tymkovich
                                                     Circuit Judge




                                         -26-

Source:  CourtListener

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