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Eclipse Enterprise Solutions, LLC v. Endoceutics

August 27, 2012

ECLIPSE ENTERPRISE SOLUTIONS, LLC
v.
ENDOCEUTICS, INC.



The opinion of the court was delivered by: Landya McCafferty United States Magistrate Judge

ORDER

After a jury trial, EndoCeutics, Inc. was found liable for breaching its agreement with eClipse Enterprise Solutions, LLC ("eClipse") by failing to pay certain invoices and by failing to participate in an electronic-data-capture ("EDC") trial. For the first breach, the jury awarded $42,984.48 in damages, and for the second breach, it awarded $134,950 in damages. The jury also found that that eClipse did not breach the agreement. Before the court are: (1) EndoCeutics's motion to amend judgment, pursuant to Rule 59(e) of the Federal Rules of Civil Procedure ("Federal Rules"), or, in the alternative, for judgment as a matter of law under Rule 50, to which eClipse objects; and (2) EndoCeutics's counterclaim that eClipse is liable for violating New Hampshire's Consumer Protection Act ("CPA"), N.H. Rev. Stat. Ann. ("RSA") chapter 358-A, which was tried to the court. For the reasons that follow, EndoCeutics's motion for post-verdict relief is denied, and eClipse is entitled to judgment on EndoCeutics's CPA claim.

EndoCeutics's Motion for Post-Verdict Relief

A. The Legal Standard

When considering a motion for judgment as a matter of law under Rule 50, the court must "consider 'the evidence presented to the jury, and all reasonable inferences that may be drawn from such evidence, in the light most favorable to the jury verdict.'" Osorio v. One World Techs., Inc., 659 F.3d 81, 84 (1st Cir. 2011) (quoting Granfield v. CSX Transp., Inc., 597 F.3d 474, 482 (1st Cir. 2010); citing Cigna Ins. Co. v. Oy Saunatec, Ltd., 241 F.3d 1, 8 (1st Cir. 2001)). Relief under Rule 50 may be granted only "if the facts and inferences point so strongly and overwhelmingly in favor of the movant that a reasonable jury could not have reached a verdict against that party." Osorio, 659 F.3d at 84 (quoting Santos v. Sunrise Med., Inc., 351 F.3d 587, 590 (1st Cir. 2003); citing Star Fin. Servs., Inc. v. Aastar Mortg. Corp., 89 F.3d 5, 8 (1st Cir. 1996)).

"Generally, to prevail on a Rule 59(e) motion [to amend a judgment], the moving party 'must either clearly establish a manifest error of law or must present newly discovered evidence.'" Markel Am. Ins. Co. v. Diaz-Santiago, 674 F.3d 21, 32 (1st Cir. 2012) (quoting FDIC v. World Univ. Inc., 978 F.2d 10, 16 (1st Cir. 1992); citing Marie v. Allied Home Mortg. Corp., 402 F.3d 1, 7 n.2 (1st Cir. 2005)).

B. Discussion

EndoCeutics asks the court to rule that it did not breach the agreement between itself and eClipse, and that eClipse did breach the agreement, and is liable for damages. In support of that request, it raises three arguments: (1) the jury failed to follow the court's instructions or improperly considered matters outside the contract at issue; (2) counsel for eClipse made improper statements during his closing argument; and (3) the jury's award of damages is not supported by the evidence. eClipse disagrees, categorically. The court considers each argument in turn.

1. Alleged Failure to Follow Jury Instructions According to EndoCeutics, the jury necessarily failed to follow the court's instructions, or improperly considered issues outside the contract at issue, because there was no evidentiary basis for two findings necessary to support its determination that EndoCeutics breached its agreement with eClipse. Specifically, EndoCeutics argues that if the jury had followed the court's instructions and/or had limited its attention to the issues properly before it, it could not have found that the parties had agreed to waive the contract provision requiring modifications to be in writing and had agreed to modify eClipse's contractual obligation to use OpenClinica software. The court does not agree.

On the issue of contract modification, the court instructed the jury as follows:

Obligations under a contract can be changed by either an express or an implied mutual agreement between the parties. The written terms of a contract may be waived orally or by implication. Whether the parties have agreed to change their obligations under a contract, or the terms of a contract, must be determined under the facts of each case. Thus, where one party to a contract claims that the other party agreed to a modification of their contract, and the contract includes a clause requiring modifications to be in writing, the party claiming that the contract was modified must prove both an agreement to the modification itself and an agreement to waive the in-writing requirement.

Tr. (doc. no. 49), at 51-52. Here, there was sufficient evidence from which a reasonable jury could have concluded, based on the course of dealing between Les Bihari and Lyne Lavoie, that EndoCeutics had agreed both to waive the in-writing requirement and to modify the substantive terms of the agreement. It is undisputed that the project milestones and dates of completion set out in Section 4.0 were altered without any written agreement by the parties. Those multiple alterations to the written terms of the contract are an implied waiver of the in-writing requirement. Moreover, there was evidence at trial that the alterations eClipse made to the OpenClinica code were made in response to requests from Lavoie in order to achieve functionalities desired by eClipse that were not possible with OpenClinica. While there was testimony that Lavoie had no authority to agree to contract modifications, and did not realize that the functionalities she requested would require a shift from off-the-shelf OpenClinica to eClipse's proprietary version, a jury could have concluded that Bihari reasonably understood Lavoie's communications to imply a properly authorized agreement to modify the substantive terms of the contract. Accordingly, EndoCeutics's first argument does not entitle it to the post-verdict relief it seeks.*fn1

2. Statements by Counsel During Closing Argument EndoCeutics next challenges the propriety of the following portion of eClipse's closing argument:

Okay. I talked a lot about credibility, and I have one more topic that I want to address with you, and that is the ...


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