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Halifax-American Energy Co., LLC v. Provider Power, LLC

Supreme Court of New Hampshire

February 9, 2018


          Argued: June 1, 2017


          Hinckley, Allen & Snyder, LLP, of Concord (Christopher H.M. Carter and Daniel M. Deschenes on the brief, and Mr. Carter orally), for the plaintiffs.

          Bernstein, Shur, Sawyer & Nelson, P.A., of Manchester (Andru H. Volinsky and Talesha L. Saint-Marc on the brief, and Mr. Volinsky orally), for the defendants.

          BASSETT, J.

         The plaintiffs are four companies with common owners and operators: Halifax-American Energy Company, LLC; PNE Energy Supply, LLC (PNE); Resident Power Natural Gas & Electric Solutions, LLC (Resident Power); and Freedom Logistics, LLC d/b/a Freedom Energy Logistics, LLC. Collectively, they are referred to as the "Freedom Companies." The defendants are three companies and their owners: Provider Power, LLC; Electricity N.H., LLC d/b/a E.N.H. Power; Electricity Maine, LLC; Emile Clavet; and Kevin Dean. Collectively, they are referred to as the "Provider Power Companies."

         The Freedom Companies and the Provider Power Companies are engaged in the same business - arranging for the supply of electricity and natural gas to commercial and residential customers in New Hampshire and other New England states. The parties' current dispute concerns a Freedom Company employee whom the defendants hired, without the plaintiffs' knowledge, allegedly to misappropriate the plaintiffs' confidential and proprietary information. According to the plaintiffs, the defendants used the information obtained from the employee to harm the plaintiffs' business by improperly interfering with their relationships with their customers and the employee.

         After a seven-day jury trial in Superior Court (Anderson, J.), the jury returned verdicts in the plaintiffs' favor on many of their claims, including those for tortious interference with customer contracts, tortious interference with economic relations with customers, tortious interference with the employee's contract, and misappropriation of trade secrets. The jury awarded compensatory damages to the plaintiffs on each of these claims, except the misappropriation of trade secrets claim, and included in the damages award $93, 000 for the attorney's fees incurred by the plaintiffs in prior litigation against the employee for his wrongful conduct. The jury's total damages award, including the attorney's fees, was $556, 208. Subsequently, the trial court awarded attorney's fees to the plaintiffs under the New Hampshire Uniform Trade Secrets Act (NHUTSA), see RSA ch. 350-B (2009).

         On appeal, the defendants challenge: (1) the jury's verdicts on the plaintiffs' claims for tortious interference with customer contracts and the employee's contract; (2) the jury's award of damages for tortious interference with customer contracts and tortious interference with economic relations, and its inclusion in that award of the attorney's fees incurred in the plaintiffs' prior litigation against the employee; and (3) the trial court's award of attorney's fees to the plaintiffs under the NHUTSA. We affirm.

         Before addressing the defendants' numerous appellate arguments, we highlight the following principles. First, we decline to review any argument that the defendants did not raise before the trial court. See State v. Blackmer, 149 N.H. 47, 48 (2003). "The general rule in this jurisdiction is that a contemporaneous and specific objection is required to preserve an issue for appellate review." Id. (quotation omitted). "This rule, which is based on common sense and judicial economy, recognizes that trial forums should have an opportunity to rule on issues and to correct errors before they are presented to the appellate court." Id. (quotation omitted). As the appealing parties, it is the defendants' burden to provide this court with a record demonstrating that they raised their appeal arguments before the trial court. See Bean v. Red Oak Prop. Mgmt., 151 N.H. 248, 250 (2004). Moreover, although the plain error rule allows us to consider errors not brought to the attention of the trial court, see Sup. Ct. R. 16-A, in this case, we exercise our discretion to consider plain error only when the defendants specifically argue under that rule.

         Second, we confine our review to only those issues that the defendants have fully briefed. See Blackmer, 149 N.H. at 49. "[I]n the realm of appellate review, a mere laundry list of complaints regarding adverse rulings by the trial court, without developed legal argument, is insufficient to warrant judicial review." Id. (quotation omitted).

         Third, we will not review any issue that the defendants address in their brief, but did not raise in their notice of appeal. See id. An argument that is not raised in a party's notice of appeal is not preserved for appellate review. Id. For example, although the defendants purport to challenge the jury's verdict on the plaintiffs' misappropriation of trade secrets claim, the argument is not preserved for our review because the defendants did not include that issue in their notice of appeal.

         Similarly, we will not address any issue that the defendants raised in their notice of appeal, but did not brief. The defendants raise 27 questions in their notice of appeal, but have briefed far fewer. Any issue that the defendants raised in their notice of appeal, but did not brief, is deemed waived. See In re Estate of King, 149 N.H. 226, 230 (2003).

         With these principles in mind, we address only a fraction of the defendants' arguments. We do not address other arguments either because they were not preserved, were not sufficiently developed for appellate review, were not raised in the defendants' notice of appeal, or were raised in the notice of appeal but not briefed.

         I. The Defendants' Challenges to the Jury Verdicts

         A. Tortious Interference with Customer Contracts

         1. PNE

         After trial, the defendants moved for judgment notwithstanding the verdict (JNOV) as to the plaintiffs' tortious interference with certain of PNE's customer contracts on the ground that the plaintiffs had failed to prove that those contracts remained valid after February 2013. According to the defendants, in February 2013, PNE "failed financially because it was unable to maintain its required financial sureties with ISO [New England], " which the defendants assert, manages the "wholesale power transmission market, sometimes referred to as 'the grid.'" The defendants contend that, as a result, ISO New England "suspended PNE's participation in the power market and directed the host utility, " Public Service of New Hampshire (PSNH), "to assume responsibility" for the electricity used by PNE's customers by February 20, 2013. The defendants state that, on February 20, "all of PNE's customers were transferred to PSNH for their electricity needs, and PNE stopped buying electricity and re-selling the electricity to its customers." The defendants concede that "PNE was released from its suspension[ ] . . . in late March 2013, " but contend that PNE "was not able to immediately recover financially and was not back up and running until June." The defendants argued that they were entitled to JNOV with regard to PNE's contracts with the customers that transferred to PSNH because the plaintiffs failed to prove that PNE maintained contracts with those customers after it was suspended.

         The trial court denied the defendants' motion, finding that "there was sufficient evidence for the jury to find that the [challenged] contracts continued even after the customers were transferred to PSNH." For instance, the trial court noted, the employee "testified that, on behalf of [the] [p]laintiffs, he would maintain the relationships with customers even after they were transferred to a utility during periods of market volatility." The trial court stated that the employee also testified that, as part of the service that the plaintiffs provided to customers, the employee "would keep the customers abreast of market conditions and forecasts, so that when rates went down customers could return to [the] [p]laintiffs for their service." According to the employee, "this service was part of the contractual relationship." The trial court also determined that there was sufficient evidence from which the jury could have found that the plaintiffs and their customers "contemplated this sort of short-term transfer." The defendants argue that the trial court erred in so ruling.

         A motion for JNOV relates to the sufficiency of the evidence and presents a question of law. Murray v. McNamara, 167 N.H. 474, 478 (2015). A party is entitled to JNOV only when the sole reasonable inference that may be drawn from the evidence, which must be viewed in the light most favorable to the non-moving party, is so overwhelmingly in favor of the moving party that no contrary verdict could stand. Id. at 478-79. The court cannot weigh the evidence or inquire into the credibility of the witnesses, and if the evidence adduced at trial is conflicting, or if several reasonable inferences may be drawn, the motion should be denied. Id. at 479.

         Although in the past we have stated that we will not overturn the trial court's decision absent an unsustainable exercise of discretion, id., in fact, because a motion for JNOV presents a question of law, our review is de novo, see Ellis v. Candia Trailers & Snow Equip., 164 N.H. 457, 463 (2012) (explaining that "[w]e review questions of law de novo").

         Based upon our review of the record, we cannot conclude that the trial court erred by denying the defendants' motion for JNOV. As the trial court aptly observed, the evidence adduced at trial was conflicting, and while the defendants' evidence "may have cast doubt" on the plaintiffs' evidence, it "did not prevent a reasonable jury" from finding that "the contractual relationships continued after the suspension."

         2. Resident Power

         The defendants argue that they were entitled to JNOV with regard to certain of Resident Power's customers because, although Resident Power was not suspended, it "suffered significant reputational damage because it was so closely linked to PNE, which was suspended." Moreover, the defendants assert, Resident Power's contracts with certain customers provided for automatic termination of the contract if a party ceases conducting business "in the ordinary sense, " and, following PNE's suspension, Resident Power ceased conducting business "in the ordinary sense." According to the defendants, "Resident Power effectively ceas[ed] to conduct business in the ordinary sense" because it "could not transfer the customers placed with PNE to a new supplier without the customers' permission or without facing slamming allegations."

         In denying the defendants' motion for JNOV, the trial court determined that the phrase "to conduct business in the ordinary sense" is ambiguous "as it could be reasonably understood to mean either a significant disruption in business, however fleeting in length, or the permanent shutdown of operations." (Quotation omitted.) The trial court concluded that, given the provision's ambiguity, "the jury was entitled to decide [its] meaning and application."

         Because the defendants do not argue otherwise, we assume without deciding that the meaning of the provision was a fact question for the jury to decide. Viewing the evidence in the light most favorable to the plaintiffs, we cannot say that the sole reasonable inference is that Resident Power ceased to "conduct business in the ordinary sense" when PNE was suspended. See Murray, 167 N.H. at 478-79. Accordingly, we conclude that the trial court's denial of the defendants' motion for JNOV on this ground was not erroneous.

         B. Tortious Interference with the Employee's Contract

         The defendants assert that the trial court erred when it declined their request for "an instruction that required the jury to find" that the non-compete provision in the employee's contract with the plaintiffs "was backed by consideration." The defendants argue that, without such an instruction, "[t]he jury was conclusively required to presume the validity of [the employee's] non-compete agreement." They further argue that, in fact, the non-compete provision lacked consideration and, therefore, that "the trial court's refusal to instruct the jury as requested was error because the jury could have been misled into basing ...

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