Learning Technology Partners v. University of the Incarnate Word

Filing 151

ORDER re affirmative defenses, jury instructions, and verdict form. Signed by Judge Hamilton on 2/11/2016. (pjhlc2, COURT STAFF) (Filed on 2/11/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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LEARNING TECHNOLOGY
PARTNERS,

Case No. 14-cv-4322-PJH

Plaintiff,
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ORDER RE AFFIRMATIVE DEFENSES,
JURY INSTRUCTIONS, AND VERDICT
FORM

v.
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United States District Court
Northern District of California

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UNIVERSITY OF THE INCARNATE
WORD,
Defendant.

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Following the December 17, 2015 pretrial conference, the court directed the

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parties in the above-captioned case to file supplemental briefs “on issues of (1) the

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applicability of a comparative fault defense, and (2) the applicability of the asserted

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affirmative defenses in general, including whether they are to be decided by the court or

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by a jury.” Dkt. 116 at 8. The court further directed the parties to “avoid affirmative

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defenses that are duplicative or that largely overlap with each other.” Id. The court also

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deferred a full determination regarding the jury instructions and verdict form until after the

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affirmative defense-related issues were resolved. Now, having reviewed the parties’

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supplemental briefs and carefully considered the arguments and the relevant legal

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authority, and good cause appearing, the court hereby rules as follows.

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In its supplemental brief, defendant University of the Incarnate Word (“defendant”

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or “UIW”) represents that it will present evidence at trial regarding eight affirmative

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defenses: (1) statute of limitations, (2) waiver, (3) accord and satisfaction, (4)

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modification, (5) estoppel, (6) failure to mitigate, (7) comparative fault, and (8) unclean

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hands. In a footnote, UIW further states that it will assert offset as an affirmative defense

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to be decided by the court, if necessary, after the jury returns its verdict. The court will

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address each of these affirmative defenses in turn.

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First, UIW asserts a statute of limitations defense. Plaintiff Learning Technology
Partners (“plaintiff” or “LTP”) does not dispute that a statute of limitations instruction

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should be given, though it notes that there is a dispute as to whether a two-year or four-

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year statute of limitations applies. However, at least part of the dispute has been

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resolved by the court’s orders issued subsequent to the pretrial conference. The court

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will give the statute of limitations instruction from the Judicial Council of California, Civil

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Jury Instructions (“CACI”) to the jury (CACI 338). As will be discussed at the end of this

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United States District Court
Northern District of California

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order, the parties shall submit their proposed versions of CACI 338, and the court will

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resolve any remaining dispute.

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Second, UIW asserts a waiver defense, and plaintiff does not oppose giving the
jury this instruction. Accordingly, the instruction from CACI 336 will be given to the jury.
Third, UIW asserts an accord and satisfaction defense. UIW describes “accord

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and satisfaction” as “the substitution of a new agreement for and in satisfaction of a

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preexisting agreement between the same parties.” The court finds that this defense is

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duplicative of UIW’s modification defense (discussed in the next paragraph), and also

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notes that there is no instruction from CACI or from the Ninth Circuit model instructions

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on this issue. Accordingly, no instruction on this defense will be given to the jury.

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Fourth, UIW asserts a modification defense. UIW describes this defense as “a

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change in the obligation by a modifying agreement which requires mutual assent.”

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Because this defense covers the same concept as does the “accord and satisfaction”

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defense, and because there is a CACI instruction on “modification,” the court will give the

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jury the instruction from CACI 313.

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Fifth, UIW asserts an estoppel defense. UIW acknowledges that estoppel is an

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equitable defense to be decided by the court, but argues that the jury should

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nevertheless decide the issue, because it is “inextricably intertwined” with the facts and
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issues underlying many of the other affirmative defenses. However, because there is no

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CACI instruction or Ninth Circuit model instruction on the issue, and because estoppel is

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an issue properly decided by the court, the jury will not be given an instruction on

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estoppel.

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Sixth, UIW asserts a failure to mitigate defense, and plaintiff does not oppose

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giving the jury this instruction. Accordingly, the instruction from CACI 358 will be given to

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the jury.

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Seventh, UIW asserts a comparative fault defense. UIW argues that comparative

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fault has been applied in previous contract cases, although its only Ninth Circuit authority
states only that the “California Supreme Court has not expressly decided whether

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United States District Court
Northern District of California

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comparative fault applies to breach of express warranty claims.” Trishan Air, Inc. v.

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Dassault Falcon Jet Corp., 532 Fed. Appx. 784, 788 (9th Cir. 2013) (emphasis added).

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UIW then cites two contract cases from this district where motions to strike the affirmative

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defense of comparative fault were denied. FDIC v. Straub, 2011 WL 1965621 (N.D. Cal.

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May 31, 2012); FDIC v. Warren, 2011 WL 5079504 (N.D. Cal. Oct. 25, 2011). However,

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this is not an express warranty case, nor is the current procedural posture in any way

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similar to that in Straub or Warren. Accordingly, the court finds those cases inapposite.

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Defendant then cites a California appeal court case where a comparative fault

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instruction was given in a breach of contract case. Royal Neckwear v. Century City, 205

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Cal.App.3d 1146 (1988). UIW argues that this case “demonstrates that a reduction in

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damages based on plaintiff’s conduct (i.e., comparative fault) is appropriate for a breach

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of contract case.” However, UIW also acknowledges that Royal Neckwear involved both

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a contract claim and a negligence claim, and that the court “issued a single instruction” to

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“reduce the amount of damages by the proportion or percentage of negligence

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attributable to plaintiff.”

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LTP points out a number of distinctions between this case and Royal Neckwear,

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the primary one being that the jury in this case will already receive an instruction on the

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failure to mitigate, which allows the jury to “reduc[e] damages based on plaintiff’s
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conduct.”

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The court declines to give the jury an instruction on the comparative fault defense

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for two reasons. First, UIW has not presented sufficient authority for the proposition that

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a comparative fault instruction is properly given in contract cases, especially in contract

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cases that do not involve express warranty claims or mixed contract/negligence claims.

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Second, any comparative fault instruction would indeed be duplicative of UIW’s failure to

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mitigate defense. Any conduct that UIW characterizes as showing LTP’s “fault” can also

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be described as showing plaintiff’s failure to mitigate damages.

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Eighth, UIW asserts an unclean hands defense. As it did in the context of the
estoppel defense, UIW acknowledges that this is an equitable defense to be decided by

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United States District Court
Northern District of California

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the court, but argues that it should nevertheless be given to the jury because it is

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“inextricably intertwined” with UIW’s other defenses. However, because there is no CACI

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instruction or Ninth Circuit model instruction on the issue, and because unclean hands is

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an issue properly decided by the court, the jury will not be given an instruction on unclean

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hands.

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Finally, as to offset, the parties agree that this defense results in a purely
arithmetic task that can be conducted by the court post-verdict.
Turning to LTP’s affirmative defenses asserted in response to UIW’s counterclaim,

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LTP asserts five such defenses: (1) UIW’s breach, (2) failure to mitigate, (3) waiver, (4)

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setoff, and (5) estoppel.

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First, LTP asserts a defense of “UIW’s breach,” and its brief describes this defense

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as “interrelated to UIW’s inability to prove that it performed all or substantially all of what

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was required – an essential element of its contract claim.” LTP’s own characterization

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underscores the redundancy of this defense. As part of its own counterclaim, UIW must

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prove that it performed all or substantially all of what was required. To the extent that

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LTP presents evidence that UIW failed to do so, such evidence serves to negate an

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element of UIW’s counterclaim – it does not constitute a separate affirmative defense.

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Thus, no separate instruction on this issue will be given.
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Second LTP asse a failur to mitigat defense, and the co will trea it the
d,
erts
re
te
,
ourt
at

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same way tha it treated UIW’s failu to mitiga defense namely, b giving th
at
ure
ate
e,
by
he

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struction fro CACI 35 to the jur
om
58
ry.
ins

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Third, LTP asserts a waiver defense, an the cour will again treat it the same way
nd
rt
n
e
y

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tha it treated UIW’s waiv defense namely, b giving th instructio from CA 336 to
at
ver
e,
by
he
on
ACI

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the jury.
e

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Fourth, LTP asserts a setoff defense, a the court will again treat it the same way
and
n
e
y
at
off
,
by
g
post-verdic
ct.
tha it treated UIW’s seto defense, namely, b resolving the issue p
Fifth an finally, LTP asserts an estopp defense, and the co will aga treat it
nd
L
s
pel
ourt
ain
the same way that it trea
e
y
ated UIW’s estoppel de
efense, nam
mely, by fin
nding it is an equitable
n

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United States District Court
Northern District of California

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def
fense to be decided by the court.
e

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Having resolved the issues regarding th parties’ a
g
t
r
he
affirmative defenses, t court
the

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directs the pa
arties to sub
bmit a revised version of the prop
posed jury instructions (Dkt. 100),
s

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inc
corporating the rulings from this order and th court’s p
o
he
previous ord
ders. No la than
ater

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February 18, 2016, the parties sha file a blind set of join jury instr
all
nt
ructions, eliminating

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the source of instruction and footer reflecting t submitting party. E
e
the
Each party shall also

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separately submit a set of their individual instr
o
ructions, co
omporting w the pret
with
trial rulings

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gs
d
der. The in
ndividually-s
submitted in
nstructions shall
and the ruling contained in this ord

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ruction and one with th source o the instru
he
of
uction and t name of
the
contain both a blind instr

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e
g
the submitting party.

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Also no later than February 18, 2016, t parties shall subm a joint pro
o
n
the
mit
oposed
ver
rdict form, reflecting th court’s ru
r
he
ulings from this order and previou orders.
us

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IT IS SO ORDER
S
RED.
Da
ated: Febru
uary 11, 201
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__
__________
__________
__________
_______
PH
HYLLIS J. H
HAMILTON
Un
nited States District Ju
s
udge

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