JOSEPH DICLERICO, Jr., District Judge.
Christopher Campbell, brings this action against his former employer, CGM, LLC, asserting claims for breach of contract; fraud, deceit and misrepresentation; violation of the New Hampshire Consumer Protection Act, RSA Chapter 358-A; and unpaid wages under RSA chapter 275. CGM brought counterclaims against Campbell for breach of contract; conversion; violation of the Computer Fraud and Abuse Act, 18 U.S.C. § 1030; tortious interference with contract; punitive damages; and injunctive relief. Both Campbell and CGM have filed motions for summary judgment.
Summary judgment is appropriate when the moving party "shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). "A genuine dispute is one that a reasonable fact-finder could resolve in favor of either party and a material fact is one that could affect the outcome of the case."
When considering cross motions for summary judgment, the court must "determine whether either of the parties deserves judgment as a matter of law on facts that are not disputed."
Campbell previously moved to strike the declaration of Duane Szarek submitted by CGM in support of its objection to Campbell's motion for summary judgment. Campbell asserted that the declaration impermissibly provided expert opinions when Szarek had not been disclosed as an expert witness. The court granted the motion to strike, and Szarek's declaration is not considered for purposes of the motions for summary judgment.
CGM challenges statements made by Campbell in his affidavits as presenting "sham" affidavits. Specifically, CGM states that Campbell's statements in his affidavit dated June 1, 2015, that his company, Intellinet, had billings of "approximately $250,000" and that the subject line on the check to Campbell from CGM for $5,000 "indicated that this was the bonus [he] had earned on annual earnings from 2001 — 2004" are contradicted by deposition testimony given almost a year later on April 25, 2016. CGM also asserts that most of Campbell's October 24, 2016, affidavit is a sham because Campbell "attempts to contradict his clear deposition answers to unambiguous questions without explanation."
In the First Circuit, "`[w]hen an interested witness has given clear answers to unambiguous questions, he cannot create a conflict and resist summary judgment with an affidavit that is clearly contradictory' without providing `a clear satisfactory explanation of why the testimony is changed.'"
The sham affidavit rule does not apply to the challenged statements from the June 1, 2015, affidavit. The affidavit was prepared
In addition, the challenged statements do not clearly contradict Campbell's deposition testimony. The affidavit says Intellinet had "billings of approximately $250,000" and Campbell's deposition testimony was that he did not know the
The Reply Affidavit, dated October 24, 2016, provides an explanation of Campbell's statements about Intellinet's revenue and addresses statements made by CGM's founders in their declarations and deposition testimony. Because CGM asserts only that "most" of Campbell's affidavit is a sham, without explaining what statements clearly contradict Campbell's deposition testimony, CGM has not provided a sufficient explanation of the sham affidavit charge to permit review.
Therefore, none of the statements in Chris Campbell's affidavits are precluded as shams.
The background information is summarized from the parties' factual statements, with disputed facts noted as necessary.
This case involves claims between Christopher "Chris" Campbell, the plaintiff, and CGM, LLC, which was founded and is operated by Chris's twin brother, Charles "Chuck" Campbell, and Chuck's business partner, Kevin Murphy. Hereafter, to avoid confusion between the Campbells, the individuals will be referred to by their first names as Chris, Chuck, and Kevin.
Chris is an electrical engineer who founded Intellinet, Inc., a telecommunications business, that operated in Massachusetts and New Hampshire. CGM was founded by Chuck, Kevin, and a third partner who is no longer with the company, and operates in Georgia. CGM originally provided consulting services to telecommunications companies and now provides data processing and software development compliance services to telephone companies. Kevin is responsible for CGM's administrative and financial functions, and Chuck is responsible for business development.
Intellinet did contract work for CGM in 2000. In early 2001, Chuck proposed that Chris become an employee of CGM. Chris was interested in Chuck's proposal. At the same time, another company, CCG Consulting, was considering acquiring CGM.
On March 27, 2001, Chuck sent Chris an email with the subject of "New Christo Proposal." In the email, Chuck said that the previous deal they had discussed was an "$180K annual package plus 10% of EBITDA."
Chuck attached a spreadsheet to the email that is titled "Christo CGM deal" and is dated "3/26/2001." The spreadsheet provided projections for four years of annual salary and "EO" for each year. The projections were for "Previously Discussed Christo Deal" and "Proposed Christo Deal w/CGM Acquisition." Chuck stated: "Previous proposal was to give you 10% of the companies [sic] bottom line earnings, going forward, plus $180K package (salary plus bennies). We figured cost of bennies were [sic] approximately 1K/mo and your monthly pretax check would be $14K." Chuck also provided a projected stock value and explanation of the calculations. Chuck wrote: "We think we are a better company with you on board and want to craft a deal that works for all of us."
In the course of the negotiations, Chris was given an employment agreement. CGM represents that the employment agreement originated with CCG Consulting and was then modified by CGM and its attorneys. CGM also states that the employment agreement was required by CCG as part of the proposed acquisition that was being considered at that time. Chuck testified during his deposition that there were different versions of the employment agreement. The acquisition by CCG did not go through.
Chris signed the employment agreement, which is dated May 24, 2001, but has an effective date of April 23, 2001.
The copy of the employment agreement that Chris produced is seven pages long and jumps from Section 8 to Section 13, which is the last section. The agreement states that it is effective as of April 23, 2001, and is between Chris and CGM, LLC. The agreement provides that Chris will be paid an annual salary of $170,000 in monthly installments as the base salary. In addition, Chris will "receive 10% of the annual earnings of Company (prorated in year one), to be calculated on a calendar year basis, and to be paid upon formal closure of the Company's [CGM's] annual books."
The agreement further provided that if the acquisition by CCG went through, Chris's annual salary would be reduced to $150,000 and the bonus would be transferred "to an identical percentage of Company's stock in the acquiring entity." It also provided for a closing bonus after the acquisition. CGM agreed to pay the cost of Chris's existing medical benefits plan. The agreement included provisions for termination, nondisclosure of trade secrets and confidential information, non-solicitation and non-recruitment covenants, CGM's right to materials and the return of materials, and compliance with policies and laws. The last section, titled "Miscellaneous", includes clauses for severability, waiver, governing law, and merger.
Chris's initial annual salary at CGM was $180,000. At the end of 2001, no bonus was paid. Chris represents that he asked about the bonus, and Chuck told him that CGM had no earnings so no bonus could be paid. Chris asked to review CGM's books, but Chuck refused. The same thing happened in 2002 and 2003 with Chuck representing that the company was operating without earnings.
In 2005, Chris again asked about his bonus. CGM gave Chris a check for $5,000. The subject line on the check said: "2001-2004 (Thanks!)." Chris understood that the check was for his bonuses for those years.
As the economy generally began to decline in 2006, CGM experienced financial difficulties. For that reason, CGM reduced salaries. On October 1, 2006, Chris's salary was reduced to $125,000 and his medical benefit plan was also changed. He understood that the reduction was temporary until business improved.
Chuck told Chris that he and Kevin were making personal financial contributions to CGM and were hoping that the company's finances would improve in the future. Chris understood that everyone was making sacrifices for the good of the company. Chuck said that Chris was the highest paid person at CGM and that Chuck and Kevin were only being paid approximately $86,000 each. Chris represents that CGM's financial documents, which he has reviewed as part of this suit, show that CGM's annual earnings were much greater than Chuck and Kevin represented them to be.
In late 2008 or early 2009, Chris thought that CGM's financial status had improved and asked about returning his salary to its former amount. Chuck and Kevin denied Chris's request on the ground that Chris was not maximizing his potential at CGM. In the spring of 2009, Chuck told Chris that he could increase his income by earning commissions. CGM offered commissions to be paid on amounts received from Verizon and FairPoint. During his deposition, Chris agreed that the commissions were a change in his compensation.
CGM's bookkeeper from 2009 to 2011 testified during her deposition that Kevin told her not to pay Chris his commissions unless he asked for them. When Chris asked for his commissions, he was paid but received them late because of that restriction.
In June 2012, Kevin informed Chris during a meeting in Georgia that he was an at-will employee. Chris responded that he was not an at-will employee because he had an employment agreement with CGM that provided for $170,000 in salary, health insurance, and 10% of "annual CGM profit." Kevin asked Chris to produce the agreement. When Chris returned home, he found the agreement in his files and mailed a copy of the employment agreement to Kevin.
In late 2012, Chris asked Kevin for a raise. Chris's salary was raised to $140,000, but in exchange, his commission percentage was reduced. Chris did not raise the issue of his bonus during the compensation discussions.
By July of 2014, Chris was dissatisfied with CGM's payment of his commissions. In October of 2014, Chris met with Chuck and Kevin in Georgia. Chuck and Kevin gave Chris options for his compensation and employment at CGM, which involved significant changes in both. A second meeting was scheduled for
Chris states that he was having financial difficulties because of the reduction in his salary and his family's unanticipated medical expenses and that he had "difficulty coming to the conclusion that Kevin and Chuck were lying to me about CGM's finances." Chris suffered a breakdown in November of 2014. CGM approved a medical leave of absence for him. CGM terminated Chris's employment effective January 31, 2015.
After his termination, Chris kept the laptop computer that CGM had provided to him, which he had used for both business and personal purposes, and other items related to his work for CGM. Chris understood that the laptop was his, provided as a benefit.
Chris agreed to return the laptop after he removed his personal information, but CGM rejected that proposal. Chris then removed CGM's software and data from the laptop and proposed to keep the laptop with his personal information.
Chris and CGM decided to have a company in Boston, Evidox, generate an index of the programs on the laptop. Chris contends that the index was not helpful because it showed hundreds of thousands of programs without sufficient analysis. Chris believed that additional analysis would be expensive and not necessarily productive.
CGM contends that the Evidox index was extremely revealing because it showed that Chris had opened dozens of CGM files after his termination. Kevin asserts in his declaration that Chris did not have permission to use the laptop after his termination. He reviewed the index and identified thirty-eight files that he believed Chris opened, created, or modified after November of 2014. The files Kevin cites include employment applications and downloads from corporate websites for companies outside of New Hampshire. Kevin does not identify specific CGM files in his declaration. The computer is being stored at Evidox for a monthly fee.
CGM states in an interrogatory answer that it needs to have Chris's laptop to check and maintain software that was developed or compiled by Chris because that computer is "native to the software." CGM also states that it had to redirect and educate staff and hire external resources to "rewrite and work around the issues caused by Plaintiff's retention of CGM physical and intellectual property," which has cost and continues to cost about $10,000 to $15,000 per month. One example CGM provides is that an issue exists for a customer that cannot be resolved without access to Chris's laptop.
Chris contacted employees at FairPoint Communications, Inc., a CGM customer, to maintain his relationship with FairPoint after he was terminated by CGM. Chris's counsel contacted one of the employees at FairPoint about this lawsuit, specifically seeking information related to CGM's motion to dismiss for lack of personal jurisdiction or to transfer the case to Georgia. FairPoint's attorney contacted CGM, told Chris's counsel he did not want the employee to be deposed, and then told the parties to agree on an affidavit for that employee, which they did. CGM has lost revenue from FairPoint since Chris left.
For purposes of this suit, Chris retained Paul E. Hendrickson, C.P.A., to calculate the bonus Chris should have received from CGM under the employment agreement. Hendrickson reviewed CGM's financial records, including tax returns, and calculated bonuses for each year from 2001 through 2014.
Chris seeks summary judgment on his breach of contract claim and on the counterclaims brought against him by CGM. CGM moves for summary judgment in its favor on Chris's claims against it.
"The elements of a breach of contract claim in Georgia are: (1) a valid contract; (2) material breach of its terms; and (3) resultant damages to the party having the right to complain that the contract has been broken."
In his breach of contract claim, Chris contends that CGM breached the employment agreement he signed on May 24, 2001, by failing to pay him bonuses as provided in Section 2, paragraph 2 of the employment agreement. Chris seeks summary judgment in his favor on his breach of contract claim. CGM asserts that Chris cannot prove his breach of contract claim because there was no employment agreement, he suffered no damages, the claim is untimely, he has waived the claim, he agreed to modify the employment agreement, and the claim is barred by the statute of frauds.
By statute, "[t]o constitute a valid contract, there must be parties able to contract, a consideration moving to the contract, the assent of the parties to the terms of the contract, and a subject matter upon which the contract can operate." Ga. Code. Ann. § 13-3-1. "Under Georgia law, a contract is enforceable if there is (a) a definite offer and (b) complete acceptance (c) for consideration."
Chris alleges in his complaint that CGM breached Section 2, paragraph 2 of the employment agreement by failing to pay him bonuses.
Multiple documents may be considered together as a contract "as long as all the necessary terms are contained in signed contemporaneous writings."
No representative signed the agreement on behalf of CGM. Chuck denies that Chris signed the agreement and returned it to CGM and denies that Chris had an employment agreement with CGM. As presented in the summary judgment record, the circumstances surrounding the employment agreement are disputed. Therefore, Chris has not shown, based on undisputed facts, that the employment agreement he signed, with the date of May 24, 2001, is valid and enforceable against CGM. As a result, he is not entitled to summary judgment in his favor on his breach of contract claim.
Because Chris's motion for summary judgment on his breach of contract claim is denied due to material factual issues, the court does not reach CGM's defenses. Those defenses are considered, however, in the context of CGM's motion for summary judgment.
CGM seeks summary judgment based on its defenses of the statute of limitations, waiver, the statute of frauds, and the merger clause in the agreement. Chris objects to the motion.
CGM contends that Chris's breach of contract claim is governed by Georgia's four-year limitations period because the employment agreement was not signed by CGM. CGM asserts that the four-year limitation period began in 2001 and 2002 and expired long before Chris brought suit in 2015. Chris argues that the six-year period applies and that the employment agreement is a divisible installment contract.
"Under Georgia law, written contracts are subject to the six-year statute of limitation imposed by OGCA § 9-3-24, whereas oral/parol contracts are subject to the four-year statute of limitation imposed by OCGA § 9-3-25."
In this case, Chris asserts that CGM breached Section 2, Paragraph 2, of the written employment agreement.
A cause of action for breach of contract accrues when the breach occurs, not when the harm or result of the breach is discovered.
"When the statute of limitations begins running on a breach of contract claim depends on whether the agreement is entire or divisible."
Under the employment agreement, the term of employment was for one year, unless terminated in the first year, and then automatically renewed in one year terms unless either party provided notice of his intent to let the agreement expire. The agreement was not terminated in the first year and presumably automatically renewed thereafter. The agreement also provided that the employee would receive annual bonuses of 10% of the company's annual earnings, to be calculated and paid on a calendar year basis.
The terms of the employment agreement better fit the description of a divisible contact. The agreement does not provide for a single sum certain but instead promises to pay annual bonuses that depend on the company's annual earnings. Therefore, the statute of limitations ran separately from each year that the bonus was not paid.
The statute of frauds in Georgia provides that to be binding "[a]ny agreement that is not to be performed within one year from the making thereof . . . must be in writing and signed by the party to be charged therewith or some person lawfully authorized by him." Ga. Code Ann. § 13-5-30. An exception exists, however, "`where there has been performance on one side, accepted by the other in accordance with the contract.'"
In this case, Chris contends that CGM accepted his performance under the terms of the written employment agreement. CGM contends that there was never a written employment agreement, that it did not agree to the terms of the written agreement, and that Chris only signed a draft agreement for purposes of this case.
CGM contends that Chris waived any breach of contract claim for the unpaid bonuses by failing to assert promptly his right to the unpaid bonuses. In support, CGM relies on
In this case, however, it is at least disputed whether Chris knew that CGM was breaching the employment contact before his employment was terminated. Under the employment agreement, CGM was required to pay bonuses of 10% of the company's annual earnings. Chuck and Kevin told Chris that the company did not have annual earnings so no bonuses were due. In fact, they reduced Chris's salary on the ground that the company was experiencing difficult financial circumstances. If Chris did not know that CGM had breached the employment agreement, Chris could not choose between the options identified in
CGM argues that the employment agreement was modified when
CGM offered and Chris accepted commissions. CGM argues that the commission modification changed the compensation structure so that it was no longer required to pay bonuses. Chris contends that he never agreed to give up bonuses in exchange for commissions.
The employment agreement provides that it can only be modified "by a written instrument signed by each of the parties hereto." CGM provides no evidence of a written change to the employment agreement. In addition, under the circumstances that existed when CGM offered commissions, it appeared that the commissions were intended to fill the gap between Chris's original salary and the lower salary he was being paid in 2009. In any case, CGM offers no evidence that the commissions were offered and accepted as compensation in lieu of annual bonuses.
CGM alleges that Chris breached an implied contractual duty to deliver to CGM all intellectual property that he developed or modified during his employment. CGM also alleges that Chris breached section 7 of the employment agreement.
In his motion for partial summary judgment, Chris contends that CGM cannot show that he breached the employment agreement by failing to return the laptop computer. In support, Chris contends that he offered to return the computer if he could remove personal information and that CGM cannot show damages. Chris does not address that part of the claim brought under a theory of an implied contract.
In its objection, CGM attempts to expand its counterclaim to include other provisions in the employment agreement that were not alleged in the counterclaim.
The employment agreement provides that records, software, documents, and laptop computers, among other things, are the property of CGM and must be returned to CGM upon termination of employment. Factual disputes about the enforceability of the agreement and about Chris's retention and use of the computer prevent summary judgment in Chris's favor on CGM's counterclaim for breach of contract.
CGM moves for summary judgment on Chris's fraud claim on the grounds that the claim is untimely, that the claim is barred by the economic loss doctrine, and that Chris cannot prove the elements of fraud. Chris objects, asserting that he can prove fraud and that CGM's defenses lack merit.
To prove fraud, Chris must show that CGM made a representation to him "with knowledge of its falsity or with conscious indifference to its truth and with the intention of causing [him] to rely on the representation."
Chris asserts, supported by his affidavits, that CGM promised to pay him an annual bonus of 10% of annual earnings and that he relied on the promise to accept and continue employment at CGM. He further asserts that Chuck's representations from 2002 through 2005 that CGM did not have annual earnings to pay him a bonus were misrepresentations of CGM's financial condition and annual earnings and that CGM has regularly misrepresented its financial condition and annual earnings. In addition, he contends that the misrepresentations were made intentionally to keep him working for CGM without paying him the promised bonuses. CGM asserts that Chris cannot prove that any representations were made with knowledge of their falsity and with the intent to cause his reliance. Even if Chris could prove his fraud claim, it is barred by the economic loss doctrine.
Under New Hampshire law, the economic loss doctrine "operates generally to preclude contracting parties from pursuing tort recovery for purely economic or commercial losses associated with the contract relationship."
Chris contends that the economic loss doctrine does not apply to his fraud claim because Chuck, as his twin brother, owed him an independent duty because of their special relationship. The special relationship exception to the economic loss doctrine is narrow and must arise from a relationship that imposes an additional legal duty on the defendant outside the terms of the contract.
Therefore, Chris's fraud claim is barred by the economic loss doctrine. As a result, it is not necessary to consider CGM's statute of limitations defense. CGM is entitled to summary judgment on the fraud claim.
Chris alleges that CGM's promise to pay him annual bonuses of 10% of annual earnings to induce him to bring his business and join CGM was false and deceptive in violation of the CPA, New Hampshire RSA chapter 358-A. He further alleges that CGM's failure to pay the promised bonuses and its refusal to allow him to review the company finances was also false and deceptive in violation of the CPA. CGM moves for summary judgment on the grounds that Chris cannot prove a claim under the CPA and the claim is untimely.
The Consumer Protection Act, RSA 358-A, prohibits persons from using "any unfair method of competition or any unfair or deceptive act or practice in the conduct of any trade or commerce within this state." RSA 358-A:2. RSA 358-A:2 lists some, but not all, of the actions that fall within the Act's prohibition.
To the extent Chris's claim is that CGM did not fulfill the promises it made to him under his employment agreement, he has not shown a violation of the Act. The New Hampshire Supreme Court has not decided whether the Consumer Protection Act applies to employment disputes.
Chris contends, however, that CGM offered him bonuses to induce him to close Intellinet and to bring his business to CGM. Chuck's emails and spreadsheet in March of 2001 support that claim. He further contends that after he joined CGM with those expectations, CGM refused to make the promised bonus payments, reduced his salary, and misrepresented the financial condition of the company. While an employment relationship is not subject to the CPA, the business relationship in which Chris was induced to close Intellinet and bring his business to CGM based on promises of a certain salary and bonuses may be a transaction between entities engaged in business and transacting in a business context.
While an ordinary breach of contract claim does not show a violation of the Act, "a defendant who induces the plaintiff to enter a contract based on a knowing misrepresentation of the promisor's intent to perform under the contract violates the Consumer Protection Act."
CGM asserts, based on cases from 1995 and 1992, that "CPA claims are subject to a two-year statute of limitations" and that the discovery rule and equitable tolling do not apply. The CPA was amended in 1996, which extended the limitations period to three years and incorporated a discovery rule provision.
CGM did not present a statute of limitations defense under the governing law. Therefore, that defense cannot support CGM's motion for summary judgment.
Chris claims the unpaid bonuses from CGM are unpaid wages under RSA 275:42, III, and seeks an additional award under RSA 275:44, IV. CGM contends that Chris's claim for unpaid wages is barred because it is untimely and by the statute of frauds.
Chris agrees that his wages claim is governed by a threeyear statute of limitations.
CGM also contends that Chris's wage claim is barred by the statute of frauds because he cannot enforce an unwritten promise for bonuses. For the reasons explained above, a material factual dispute remains as to whether there is a written employment agreement in this case.
In addition to claiming that Chris breached the employment agreement by retaining the laptop, CGM also asserts a claim of conversion based on retention of the laptop. Chris moves for summary judgment, asserting that CGM cannot prove the counterclaim because he offered to return the laptop with the reasonable condition that he be allowed to remove his personal information. CGM asserts that the laptop and the programs and software on the laptop are CGM's property and that good faith is not a defense to the tort of conversion.
To succeed on a claim of conversion, the plaintiff must show that the defendant intentionally exercised dominion or control over the plaintiff's property and that the defendant's actions seriously interfered with the plaintiff's right to the property.
Significant factual disputes remain about whether Chris had a good faith belief that he could retain the laptop and whether his proposed solution of taking his personal information off of the laptop before returning it was reasonable. Therefore, Chris has not shown that he is entitled to summary judgment on CGM's conversion counterclaim.
CGM alleges that Chris was required to return the laptop to CGM at the end of his employment there, that he did not return the laptop, and that he accessed the laptop without authorization and with the intent to defraud CGM and to obtain CGM's intellectual property from the laptop. CGM further alleges that Chris caused damage, including financial damage to CGM. Chris moves for summary judgment on CGM's CFAA counterclaim on the grounds that the laptop was not being used in interstate commerce during the allegedly unauthorized use, that he believed the laptop was a benefit of his employment at CGM, that CGM has no proof that it suffered $5,000 in damages, and that CGM caused its own loss by refusing to reach a reasonable accommodation for Chris's private information on the laptop.
Under CFAA, a private cause of action exists for damages and injunctive relief due to a loss caused by a violation of 18 U.S.C. § 1030(a). See 18 U.S.C. § 1030(g). Section 1030(a) provides a long list of prohibited computer conduct.
CGM does not identify which provision of § 1030(a) it alleges Chris has violated. Assuming that CGM intended to proceed under §§ 1030(a)(4) and (5)(C), Chris moves for summary judgment on the grounds that CGM lacks evidence that it has suffered a loss of at least $5,000 and that the laptop was used in interstate commerce.
Section 1030(a)(4) pertains to a person who "knowingly and with intent to defraud, accesses a protected computer without authorization, or exceeds authorized access, and by means of such conduct furthers the intended fraud and obtains anything of value, unless the object of the fraud and the thing obtained consists only of the use of the computer and the value of such use is not more than $5,000 in any 1-year period." Section 1030(a)(5)(c) pertains to a person who "intentionally accesses a protected computer without authorization, and as a result of such conduct, causes damage and loss." A protected computer, in the context of CGM, is one that is used in interstate commerce. § 1030(e)(2)(B).
CGM responds with evidence that that the laptop was used to contact sites outside of New Hampshire to show that the laptop was used in interstate commerce. CGM also provides evidence that it has lost more than $5,000 because of Chris's retention of the computer.
Although Chris's actions do not appear to have violated the cited provisions of the Act, Chris did not contest the counterclaim on the merits or challenge the materiality of CGM's evidence of damages. Instead, Chris challenges the credibility of the evidence itself. Chris also argues that his children used the laptop to access sites outside of New Hampshire but does not show that their use of the laptop would not satisfy § 1030(e).
Summary judgment is not an appropriate vehicle for seeking credibility determinations. In the absence of any developed argument on the merits, CGM has shown a factual dispute that precludes summary judgment.
CGM alleges that Chris contacted FairPoint with the intent to injure CGM and interfered with CGM's contractual relations with FairPoint. Chris moves for summary judgment on the ground that CGM cannot prove the claim based on an assumption that Chris did something to interfere with its FairPoint business.
"To establish liability for intentional interference with contractual relations, a plaintiff must show: (1) the plaintiff had an economic relationship with a third party; (2) the defendant knew of this relationship; (3) the defendant intentionally and improperly interfered with this relationship; and (4) the plaintiff was damaged by such interference."
In its objection, CGM states that it is undisputed that it has had a contractual relationship with FairPoint since 2009 and that Chris contacted FairPoint employees after he was terminated from CGM. Chris stated in his deposition that he contacted the employees to maintain his relationships with them. Kevin states that since Chris filed the lawsuit, Kevin has had much less communication with Tim Burns at FairPoint.
That evidence is not enough to prove intentional interference with contractual relations. CGM lacks any evidence that FairPoint failed to perform under a contract with CGM because of interference by Chris. Therefore, Chris is entitled to summary judgment on that part of the counterclaim brought for intentional interference with contractual relations.
To the extent CGM intended to bring a claim for tortious interference with prospective business relations, neither the allegations nor the evidence support that claim. "To state a claim for tortious interference with a prospective contractual relationship under New Hampshire law the plaintiff must show that the defendant `induce[d] or otherwise purposely cause[d] a third person not to . . . enter into or continue a business relation with another' and thereby caused harm to the other."
CGM has evidence that Chris maintained his relationships with FairPoint employees but no evidence that he interfered with CGM's relationship with FairPoint. CGM has not presented an affidavit or any other evidence from a FairPoint executive or employee to show that because of Chris's communications, FairPoint no longer is doing business with CGM.
Instead, the evidence shows that FairPoint and its president, Patrick McHugh, did not want to be involved in this case. Therefore, any downturn in CGM's relationship with CGM appears to be the result of the lawsuit between Chris and CGM, not because Chris purposefully caused FairPoint not to continue to do business with CGM.
CGM failed to provide evidence to support its tortious interference claim. As a result, Chris is entitled to summary judgment on that claim.
In New Hampshire, "[n]o punitive damages shall be awarded in any action, unless otherwise provided by statute." RSA 507:16. "Under New Hampshire law, a claim for enhanced damages is not a separate cause of action; it is a request for a particular remedy."
For the foregoing reasons, the plaintiff's motion for partial summary judgment (document no. 45) is granted as to the defendant's counterclaims for tortious interference, Count Four, and punitive damages, Count Five, and is otherwise denied.
The defendant's motion for summary judgment (document no. 44) is granted in part and denied in part. The six-year statute of limitations applies to the plaintiff's breach of contract claim, Count I, and the employment agreement, if found to be an enforceable contract, is a divisible installment contract. The motion is granted as to the plaintiff's fraud claim, Count Two, and is otherwise denied.
Now that the motions for summary judgment have been resolved, the claims and counterclaims remaining in the case have been determined. Before the parties and the court spend the considerable time and resources necessary to prepare for trial, the parties are expected to use their best efforts to resolve all or part of the remaining claims and counterclaims.
To that end, counsel shall carefully examine their claims, counterclaims, and defenses to evaluate their viability, the proof necessary to support them, and how they will present those matters to a jury. In particular, counsel should review and evaluate the factual and legal issues pertaining to (1) the existence of an enforceable employment agreement between Chris and CGM; (2) CGM's counterclaims that also depend on a viable employment agreement; (3) Chris's retention and use of the laptop; and (4) the timeliness of the claims. In examining their cases, counsel should use every effort not to let personal animosity, which appears to be evident in this case, stand in the way of resolving issues that have stagnated, such as the issue of the laptop.
In January of 2016, the parties anticipated participating in mediation during the spring. No further mediation statement has been filed. If they have not already done so, the court expects the parties to participate in mediation before trial. The parties shall file a joint mediation statement
Due to the number of criminal cases currently scheduled for the trial period beginning on February 22, 2017, the trial of this case is rescheduled to the period beginning on March 7, 2017. The final pretrial conference will also be rescheduled accordingly.
SO ORDERED.
Chris's memorandum in support of his motion for partial summary judgment does not have page numbers as is required by Local Rule 5.1(a).
The court may impose a fine against counsel who have violated a local rule governing the form of filings, may strike the nonconforming filing, or may excuse a failure to comply "whenever justice so requires." LR 1.3; LR 5.2. In this case, the court will excuse counsel's failures to comply with the page limits and numbering with instruction to counsel that the local rules in this district shall be followed in the future or sanctions will be imposed.
Alan Schrank, who works for CGM as a contractor, testified in his deposition that he does have a written contract with CGM although he does not have a copy of it.
CGM also relies on
