Encompass Advisors, Ltd. v. Unapen, Inc. et al
Filing
144
MEMORANDUM OF DECISION setting forth FINDINGS OF FACT AND CONCLUSIONS OF LAW. Signed by Judge Donna F. Martinez on 3/31/14. (Nichols, J.)
UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT
ENCOMPASS ADVISORS, LTD.,
Plaintiff,
v.
UNAPEN, INC. et al.,
Defendants.
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CASE NO. 3:09CV1949(DFM)
MEMORANDUM OF DECISION
Plaintiff Encompass Advisors, Ltd. brings this diversity
action alleging breach of contract, fraud and violation of the
Connecticut Unfair Trade Practices Act ("CUTPA") against
defendant Unapen, Inc. and its officers David Gemma and Joan
Walker.
Unapen brings a counterclaim against plaintiff for
breach of contract.
bench trial.
briefs.
In December 2013, the court held a four-day
In February 2014, the parties submitted post-trial
Having considering the evidence and briefs, the court
concludes that plaintiff has failed to prove its claims and that
Unapen has proved its counterclaim.
I.
Findings of Fact
Based on the credible testimony, the exhibits and the
entire record developed during trial, and pursuant to Fed. R.
Civ. P. 52(a), the court finds the following facts.
Parties
Plaintiff Encompass Advisors, Ltd. is a Registered
Investment Advisor located in North Carolina whose president and
sole owner is Jon Randolph Green.
Defendant Unapen, Inc. is a
Connecticut corporation that designs and manufactures computer
software.
Defendant David Gemma is Unapen's Vice President and
Secretary.
Defendant Joan Walker is Unapen's chief financial
officer and also was its chief operating officer during the
relevant period.
Products
In November 2006, Green was using two computer systems to
keep track of his clients and their investment portfolios.
One
program was a client management database that included vital
profile information such as names, addresses, birthdates, social
security numbers, risk tolerance, whether the client permitted
trades at the advisor's discretion, etc.
The other program —
called Schwab PortfolioCenter — was a portfolio accounting
system that calculated the performance of the clients'
investments.
Any time Green wanted to know how well a client's
portfolio was performing, he had to run multiple reports of
various performance measures in PortfolioCenter, locate the
relevant data and cobble it together manually.
To increase efficiency, Green was seeking a computer
program that could pull data from various places in
2
PortfolioCenter and collate that data into a single snapshot of
the client's portfolio performance.
He also wanted a client
database that was enhanced with "daily dynamic reporting," which
meant the ability to review day-to-day performance data in a
single interface and to manipulate that interface to view the
data in different ways.
It was uncommon in the industry at that
time for a program to include both client database and
performance reporting functions.
Plaintiff's existing client
database could pull information from PortfolioCenter but only in
a limited fashion.
Unapen sold subscriptions to two proprietary
computer programs that Green believed would answer his needs —
ClientRep Lite and ClientLogix.
The purpose of the ClientRep Lite program was to generate
reports for clients of the investment advisor.
follows.
It functioned as
Once an investment advisor subscribed to ClientRep
Lite, Unapen's programmers would collaborate with the advisor to
decide what data to include in the report and how the report
should appear.
Next, the programmers would "hook up" the data
fields in ClientRep Lite with data fields in PortfolioCenter.
Unapen's proprietary "loader" software would "pull" the relevant
data from PortfolioCenter into ClientRep Lite.
The subscriber
could then print the custom report and mail it to the client.
The purpose of ClientLogix was not to create a static
report to give to clients but to aggregate information on a
3
screen so that the investment advisor could have all aspects of
a client relationship — including personal profile, investment
performance and notes — at his fingertips.
At its core,
ClientLogix was a client database but, in addition, Unapen's
loader software could pull performance data from PortfolioCenter
and display it in ClientLogix in connection with the client's
profile.
ClientLogix was "dynamic" in two senses: it organized
the client's data into levels — household, persons in that
household, and investment portfolios associated with each person
— and it enabled the investment advisor to organize data in
"dashboard" views.
In its raw form, ClientLogix had four
dashboards — My Day, consulting, sponsor review and regional
overview — but others could be added at the subscriber's
request.
In its standard form, ClientLogix was programmed to
pull daily loads of transactions data and monthly loads of
performance data but could be modified to pull performance data
on a daily basis.
Master Agreement and ClientRep Lite
On November 27, 2006, plaintiff and Unapen executed a
Master Agreement and Schedule A, which provided that plaintiff
would purchase one annual subscription to ClientRep Lite for
$2500.
The contract was signed by Jon Randolph Green and
defendant David Gemma.
(Pl.'s Ex. 1.)
to the following provisions:
4
The parties agreed that
Scope of Work:
Unapen would perform the scope of work
described in Schedule B and any modifications to Schedule B
mutually agreed upon in writing.
Payment:
(Id. at.)
Plaintiff would pay in accordance with the price
list and payment terms in the schedules and would reimburse
Unapen for all reasonable costs, including reasonable
attorney's fees, incurred in collecting past due amounts.
(Id. at § 6.)
Ownership:
Deliverables, including the Core Database,
Database Loaders, Common DLL's, Stored Procedures, User
Interface and Reports, would remain "the sole and exclusive
property of Unapen."
Warranties:
(Id. at § 5.)
Unapen warranted that its software would
perform in accordance with the "Design Analysis" for 90
days and that the program would perform in accordance with
the instructions and user manuals for 90 days after
installation.
Unapen expressly disclaimed any implied
warranty of fitness for a particular purpose or "that the
program's functionality will meet customer's requirements."
(Id. at ¶ 1.8 and § 8.)
Confidentiality:
The parties would not disclose each
other's confidential information except as permitted under
the contract.
(Id. at ¶ 4.2.)
5
"Confidential Information"
included "information whether written, electronic, or oral,
identified as proprietary and not generally available to
the public, designated as "Confidential," "Proprietary" or
with similar marking . . . .
The term includes . . .
visual demonstrations, oral disclosures . . . ."
(Id. at ¶
4.1.)
Termination:
The contract would continue for two years.
(Id. at ¶ 7.1.)
A party could terminate the contract
sooner if the other party failed to cure a default thirty
days after receiving written notice specifying the nature
of the default.
(Id. at ¶ 7.2.)
Procedures upon Termination:
Plaintiff was entitled to use
the products "during the License Term" but, immediately on
termination of the Agreement, would "pay all amounts owing
to UNAPEN, cease all use of the Product, uninstalled from
each machine, and return to UNAPEN all copies of the
Product and any other UNAPEN Confidential Information in
its possession."
Choice of Law:
Connecticut law.
Merger Clause:
(Id. at ¶ 7.3).
The contract would be governed by
(Id. at ¶ 11.5)
The contract superseded all prior
communications between the parties on the subject and would
be the "complete and exclusive statement of the agreement
between the parties relating to this subject."
6
(Id. at 8.)
Representations Regarding ClientLogix
After subscribing to ClientRep Lite in November 2006, Green
reviewed Unapen's website and had several conversations with
defendant David Gemma regarding ClientLogix.
Defendants made
the following representations:
Unapen "truly know[s]" the investment advisor business.
(Pl.'s Ex. 4 at 1.)
ClientLogix could integrate with Schwab PortfolioCenter and
could aggregate key investment information in interactive
dashboards.1
(Pl.'s Ex. 7, 10.)
ClientLogix was capable of pulling performance data from
PortfolioCenter as often as once a day as long as
information was there to be pulled.
(Doc. #133 at 24-25,
43.)
ClientLogix "provides the flexibility to be fully
customized to your needs."2
(Pl.'s Ex. 4 at 1.)
1
Subsequently, in April 2007 at the latest, Unapen's website
advertised that it could link ClientLogix with Schwab
PortfolioCenter using "powerful and proven integration
technology." (Pl.'s Ex. 10 at 2, 12.) At that time, no
registered investment advisor was using ClientLogix version 3.6.
(Doc. #134 at 140-41.) Plaintiff has not established that the
advertisement was published prior to the contract, which
precludes any finding that Green relied on it when he entered
into the contract.
2
Gemma also testified that, before Green agreed to subscribe
to ClientLogix, Gemma asked Green about plaintiff's business
needs and documented his answers. (Doc. #134 at 3-5.) No such
document is in evidence.
7
ClientLogix implementation was likely to take three to six
months.
(Doc. #133 at 46.)
On January 5, 2007, Gemma emailed to Green an Estimate for the
first year of ClientLogix version 3.6 that listed the following:
$23,390 for first annual licenses and subscription
$4,000 for installation
$15,000 to $35,000 to convert data from plaintiff's
existing database into ClientLogix
$10,000 to $20,000 for implementation
$3500 for training.
The $88,040 upper cost estimate did not include customization
costs, which were listed as "TBD" with the caveat that
"Diagnostic Analysis" was needed in order to estimate the cost
of customization.
(Defs.' Ex. 7.)
On January 16, 2007, plaintiff and Unapen executed
Schedules A,3 B, C and D of the Master Agreement.
(Pl.'s Ex. 2.)
The documents were signed by Gemma and Green and provided in
relevant part:
Schedule A:
Plaintiff would receive one annual license to
ClientLogix version 3.6 for two users.
3
This was distinct from the Schedule A dated November 26,
2007 that pertained to ClientRep Lite.
8
Schedule B:
With preauthorization from plaintiff, Unapen
would perform data conversion, document plaintiff's
business requirements and procedures, create a Design
Analysis and develop software as specified in the Design
Analysis if requested and preauthorized by plaintiff.
Schedule C:
Plaintiff would pay the $10,750 subscription
fee immediately, would pay subsequent subscription fees in
advance and would pay other invoices in net 30 days.
Schedule C set forth estimated service costs identical to
the pre-contract Estimate except that it made no mention
for customization costs.
It also set forth hourly rates
for service.
Implementation
In February 2007, Green called defendant Joan Walker to
introduce himself.
15.)
(Doc. #134 at 31, 64-65; doc. #141 at 11-
Unapen made preparations to convert data from plaintiff's
existing database into ClientLogix but, in March 2007, Green
decided to convert the data manually to reduce costs by $15,000
to $35,000.
(Defs.' Ex. 8b at 3, 9; Pl.'s Ex. 2 at 3.)
Implementation was stalled because Unapen could not test the
link between ClientLogix and PortfolioCenter until plaintiff
completed the data conversion in the first week of June 2007.
(Defs.' Ex. 8b at 19; doc. #134 at 61-62.)
9
Circumstantial evidence indicates that, while the data
conversion was ongoing, the parties discussed how to customize
the program to suit plaintiff's business.
The record does not
contain the "Diagnostic Analysis" mentioned in the pre-contract
Estimate or the "Design Analysis" mentioned in Schedule B.
Nor
does it contain an implementation questionnaire; however, an
invoice dated March 9, 2007 indicates that Unapen "[r]eviewed
the ClientLOGIX questionnaire."4
(Defs.' Ex. 8b at 5.)
Two
weeks later, Unapen proposed customizations that would enable
ClientLogix to pull performance data on a daily, not monthly,
basis.
Plaintiff did not authorize that work.
6, 9-10.)
(Pl.'s Ex. 4 at
Subsequent invoices indicate that Unapen did perform
the following services.
In March, Unapen analyzed plaintiff's
existing database, and the parties discussed developments
regarding household reporting.
(Defs.' Ex. 8b at 7.)
In April
2007, the parties discussed adding and modifying data fields,
and Unapen installed and tested ClientLogix on plaintiff's
computers.
(Id. at 13-14.)
In May and June 2007, the parties
further discussed customization of data fields.
a work order and began working on customizations.
Unapen created
Unapen
upgraded plaintiff's database to ClientLogix version 3.7 and
worked on the loader.
(Pl.'s Ex. 6 at 4-5; Pl.'s Ex. 8 at 15-
4
Gemma testified that a standard implementation
questionnaire is issued to each new ClientLogix customer.
#133 at 12-13.)
10
(Doc.
20.)
In July 2007, the parties discussed further customizations
of data fields.
(Pl.'s Ex. 4 at 31.)
On July 18, 2007, Green expressed dissatisfaction that
several fields essential to his business were not in the
standard version of ClientLogix.
Walker agreed to give
plaintiff a $7,543.75 credit as an incentive not to abandon the
program and agreed to examine issues identified by plaintiff at
no charge.
(Defs.' Ex. 8a at 27, 8b at 31-42.)
In spite of
this turn of events, plaintiff subscribed to Unapen's ITComplete
Basic Services for general technology monitoring, updates,
protection and help desk support on July 27.
(Pl.'s Ex. 3.)
On August 13, 2007, Green emailed Walker to express
continued dissatisfaction with ClientLogix.
He believed that
ClientLogix could be customized to better suit his business
needs but he did not want to wait much longer or pay much more.
(Pl.'s Ex. 4 at 21-22.)
As of that date, plaintiff had paid
$24,531.25 for ClientLogix.5
(Defs.' Ex. 9.)
In a phone
conversation, Walker agreed that Unapen would implement several
customizations immediately and add other customizations into the
next version of ClientLogix, which would be released within the
next year.
She observed that Green was in arrears on
5
Leaving aside the $35,000 estimated cost of data
conversion, which plaintiff decided to do manually, defendants
had predicted costs of $23,040 to $53,040 in the first year, not
including "TBD" customization costs.
11
ClientLogix invoices, and Green agreed to a monthly installment
plan.
(Doc. #70 at 191.)
On September 14, 2007, plaintiff made its last payment on a
ClientLogix invoice in the amount of $4000.
(Id.)
At that
time, ClientLogix was pulling transactions data from
PortfolioCenter on a daily basis.
#134 at 92-93.)
(Defs.' Ex 10 at 8-10; doc.
On October 22, 2007, Unapen emailed Green
seeking payment on outstanding ClientLogix invoices.
4 at 28.)
(Pl.'s Ex.
Plaintiff last ran a load of daily transactions data
on October 24, 2007.6
(Defs.' Ex. 11 at 24.)
Termination
On January 4, 2008, Green emailed Unapen a list of
complaints regarding ClientLogix.
He stated that he had vetted
his complaints with third parties in the industry, three of whom
were copied on the email.
to review the contracts.
He added that he had retained counsel
(Pl.'s Ex. 4 at 31-34.)
On January
24, 2008, Walker replied by letter stating that plaintiff was in
breach for failing to make timely payments.
She proposed a
compromise but stated that if plaintiff decided to discontinue
its use of ClientLogix, it must pay in full the $9,606.25 in
6
ClientLogix was designed to pull transactions data daily
and performance data monthly. Although ClientLogix was pulling
transactions data on a daily basis in October 2007, the evidence
indicates that monthly performance data last loaded on May 31,
2007. (Defs.' Ex. 11 at 5.) This discrepancy was not explained
meaningfully.
12
overdue invoices and $185 in current invoices.
(Pl.'s Ex. 5 at
5-8.)
On January 28, 2008, Green cut off Unapen's access to his
server and formally terminated his ITComplete subscription.
(Id. at 36.)
As of that date, he owed $9081.25 for ClientLogix,
$8275 for ClientRep Lite and $1268.25 for consulting that
pertained to both products.7
(Defs.' Ex. 9; doc. #134 at 40-56.)
On February 26, 2008, Walker sent a letter memorializing a
phone conversation in which she and Green discussed a compromise
and Green expressed interest in continuing to use ClientRep
Lite.
(Id. at 9-10.)
Walker sent additional letters in March
and May 2008 seeking a compromise resolution.
(Id. at 11-14.)
The two-year contract term set forth in ¶ 7.1 of the Master
Agreement said the contract expired on November 27, 2008.
(Pl.'s Ex. 1 at 4.)
In December 2008, Walker wrote a letter to
Green stating that if plaintiff did not accept Unapen's final
offer of compromise by December 19, 2008, the agreement between
plaintiff and Unapen would be terminated.
(Pl.'s Ex. 5 at 14.)
Continued Use of ClientRep Lite
Despite his dissatisfaction with ClientLogix, Green
generally was satisfied with ClientRep Lite.
71.)
(Doc. #142 at 170-
In May 2007, ClientRep Lite was disrupted when plaintiff
7
Defendants called this category "Flex IT."
48.)
13
(Doc. #134 at
made changes to asset class names in PortfolioCenter.
On that
occasion, Green agreed to pay $5175 for Unapen to make the
necessary fix.
(Pl.'s Ex. 6 at 3.)
subscription fees after 2007.
He did not pay annual
(Defs.' Ex. 9.)
Green continued
to use ClientRep Lite without paying annual subscription fees
until May 2010, when he again disrupted the program by changing
asset class names in PortfolioCenter.
the program at that time.
Unapen declined to fix
(Pl.'s Ex. 4 at 41-42.)8
The amount
of the unpaid subscriptions from 2008 to 2010 was $7500.
(Defs.' Ex. 9.)
II.
Conclusions of Law
Plaintiff claims that defendants made fraudulent
representations about the functionality of ClientLogix (Count
One), breached the Master Agreement with respect to ClientLogix
(Count Two), violated CUTPA (Count Three) and breached the
Master Agreement with respect to ClientRep Lite (Count Four).
(Doc. #47.)
Unapen counterclaims that plaintiff breached the
Master Agreement by disclosing confidential information and
failing to pay amounts owing.
A.
Fraud
In Connecticut, the elements of common law fraud are:
8
Defendants also allege that plaintiff continued to use
ClientLogix. As evidence, they point to a notation in the
program that is dated 6/23/2013. (Defs.' Ex. 11 at 22.) The
record does not contain sufficient contextual explanation to
render the evidence meaningful.
14
(1) a false representation was made as a statement of fact;
(2) it was untrue and known to be untrue by the party
making it; (3) it was made to induce the other party to act
upon it; and (4) the other party did so act upon that false
representation to his injury. . . . [T]he party to whom
the false representation was made [must claim] to have
relied on that representation and to have suffered harm as
a result of the reliance.
Sturm v. Harb Development, LLC, 298 Conn. 124, 142 (2010)
(alterations in original).
"Although proof by preponderance of
the evidence is the ordinary civil standard of proof . . ., the
clear and convincing standard is the appropriate standard of
proof in common-law fraud cases."
Goldstar Med. Servs. v. Dep't
of Soc. Servs, 288 Conn. 790, 819 (2008).
"'[The burden] is
sustained if evidence induces in the mind of the trier a
reasonable belief that the facts asserted are highly probably
true, that the probability that they are true or exist is
substantially greater than the probability that they are false
or do not exist.'"
O'Connor v. Larocque, 302 Conn. 562, 572–79
(2011) (citation omitted).
The record in this case does not contain clear and
convincing evidence of fraud.
To begin with, plaintiff has not
established that Green had any contact at all with defendant
Walker prior to executing the ClientLogix agreement in January
2007, so the claim against her must fail.
Turning to the fraud claims against Unapen and Gemma,
plaintiff argues that Unapen's advertisement that it had
15
"powerful and proven integration technology" was false because
no customer had ClientLogix 3.6 in production at the time.
Plaintiff has not established that the advertisement was made
prior to the contract.
Plaintiff also contends that the implementation of
ClientLogix lasted longer and cost more than promised.
There is
no credible evidence that defendants promised that
customizations would be completed by a date certain.
Gemma did
represent that implementation would take three to six months
based on the assumption that Unapen would perform the data
conversion.
Due to Green's decision to do his own data
conversion, testing and implementation was delayed until June
2007, six months after the contract was signed.
As for cost,
leaving aside the data conversion estimate, defendants predicted
costs for ClientLogix of $23,040 to $53,040 in the first year
not including customization.
In total, Unapen billed $39,605.75
for work on ClientLogix, including customizations.9
This was in
line with defendants' representations.
Finally, plaintiff contends that Unapen falsely represented
that it knew the registered investment advisor business and
Gemma falsely represented that ClientLogix was capable of
pulling daily performance data.
If Green interpreted these
9
This total includes the $1993.25 billed for Flex IT and
excludes the $29,256.25 billed for ClientRep Lite and $1295
billed for ITComplete.
16
statements to mean that ClientLogix would suit his business
model without customization, it was his own mistake.
He knew
that he was asking for functionality that was uncommon at that
time, and he had the opportunity to review the raw product in
two live demonstrations prior to purchasing it.
In addition,
the record indicates that customization was a key selling point
of ClientLogix.
Gemma represented that ClientLogix had "the
flexibility to be fully customized to your needs."
He sent a
cost estimate listing customizations as "TBD" pending diagnostic
analysis.
Schedule B of the contract provided that Unapen would
document plaintiff's business requirements and procedures,
create a Design Analysis for ClientLogix and develop software as
specified in the Design Analysis if requested and preauthorized
by plaintiff.
It should have come as no surprise that some
development would be necessary to adapt ClientLogix to
plaintiff's business and that such development would not be
provided free of charge.
For the foregoing reasons, plaintiff cannot prevail on its
claim of fraud.
B.
Breach of Contract
Turning to the breach of contract claims, "[t]he elements
of a breach of contract action are the formation of an
agreement, performance by one party, breach of the agreement by
the other party and damages."
Treglia v. Santa Fuel, Inc., 148
17
Conn. App. 39, 45 (Conn. App. 2014) (quotation marks omitted).
Plaintiff and defendant Unapen agree that they entered a
contract and commenced performance but each claims that the
other breached.
1.
Plaintiff's Claims (Counts Two and Four)
In Count Two, plaintiff claims that ClientLogix failed to
deliver daily performance reporting as promised.
This claim
turns on the warranty provisions of the Master Agreement.
Unapen warranted that its software would perform in accordance
with the "Design Analysis" for 90 days and that the program
would perform in accordance with the instructions and user
manuals for 90 days after installation.
It expressly disclaimed
any implied warranty of fitness for a particular purpose or
"that the program's functionality will meet customer's
requirements."
Because the record does not include a Design
Analysis, product instructions or user manuals, there is no
evidence that ClientLogix functioned less well than the product
plaintiff was supposed to have received.
In Count Four, plaintiff claims that defendants breached
the contract by failing to repair ClientRep Lite.
The evidence
establishes that plaintiff made changes to asset class names in
PortfolioCenter in May 2007 and May 2010 that disrupted its
integration with ClientRep Lite.
Unapen repaired the disruption
in May 2007 but not in May 2010.
Because the Master Agreement
18
terminated in 2008, Unapen had no obligation to repair the
program in 2010.
2.
Unapen's Counterclaim
In its counterclaim, Unapen alleges that plaintiff breached
the Master Agreement by disclosing confidential information and
failing to pay amounts owing.
There is insufficient evidence to
determine whether plaintiff breached the confidentiality
provision.
Green admitted to conversations with third parties
but Unapen has not proved that those conversations included
confidential information under the contract.
But Unapen has
proved by a preponderance of the evidence that plaintiff
breached the contract by failing to pay for services that Green
preauthorized.
Schedule B set forth the scope of services to be
provided, and ¶ 3.1 of the Master Agreement provided that
modifications to the scope of work must be agreed to in writing.
Schedule C set forth cost estimates and hourly rates and
provided that plaintiff would pay invoices in net 30 days.
Plaintiff's payments were in arrears by August 2007.
Plaintiff also breached the Master Agreement by using
ClientRep Lite after the one-year license term expired and by
failing to uninstall ClientLogix and ClientRep Lite and return
all copies of the products and confidential information to
Unapen once the Agreement was terminated.
19
C.
CUTPA (Count Three)
Plaintiff also claims that defendants violated the
Connecticut Unfair Trade Practices Act ("CUTPA").
See Conn.
Gen. Stat. § 42-110b(a) ("No person shall engage in unfair
methods of competition and unfair or deceptive acts or practices
in the conduct of any trade or commerce.").
To determine
whether a practice violates CUTPA, the state courts apply the
three criteria of the "cigarette rule" developed by the Federal
Trade Commission:
(1) [W]hether the practice, without necessarily having
been previously considered unlawful, offends public
policy as it has been established by statutes, the
common law, or otherwise — whether, in other words, it
is within at least the penumbra of some common law,
statutory, or other established concept of unfairness;
(2) whether it is immoral, unethical, oppressive, or
unscrupulous; (3) whether it causes substantial injury
to consumers [(competitors or other businessmen)].
Cheshire Mortgage Serv., Inc. v. Montes, 223 Conn. 80, 105–06
(1992) (alterations in original) (quoting FTC v. Sperry &
Hutchinson Co., 405 U.S. 233, 244 n.5, (1972)).
"All three
criteria do not need to be satisfied to support a finding of
unfairness.
A practice may be unfair because of the degree to
which it meets one of the criteria or because to a lesser extent
it meets all three."
Id.
To prevail, the plaintiff must
establish both that the defendant engaged in a prohibited act
and that was the proximate cause of the harm to the plaintiff.
Priority Sales Mgmt., Inc. v. Carla's Pasta, Inc.,
20
3:10CV1918(CFD), 2011 WL 3819748, at *3 (D. Conn. Aug. 26,
2011).
Plaintiff alleges that defendants made false or misleading
representations that induced it to buy a product that was
unsuited to its needs.
The evidence advanced in support of
these allegations is insufficient to establish a CUTPA
violation.
D.
Damages
As the prevailing party on its breach of contract
counterclaim, Unapen seeks damages and the return of all copies
of its products and confidential information.
In light of the
foregoing, Unapen is entitled to damages in the amount of
$18,625 for the unpaid invoices10 and $7500 for unpaid ClientRep
Lite subscription fees.
It is also entitled to the reasonable
attorney's fees incurred in collecting the amounts owing.
Finally, it is entitled to the return of all copies of its
products and confidential information in plaintiff's possession.
III. Conclusion
Judgment shall enter in favor of defendants on Counts One
through Four and in favor of counterclaim plaintiff Unapen on
its counterclaim.
Unapen is awarded $26,125 in damages and the
10
That sum reflects $9081.75 in unpaid ClientLogix invoices,
$8275 in unpaid ClientRep Lite invoices and $1268.25 in unpaid
Flex IT invoices. (Defs.' Ex. 9.)
21
reasonable attorney's fees incurred in collecting the amounts
owing.
Plaintiff shall cease all use of Unapen's products,
uninstall all copies of the products and return them to Unapen
along with any other "Confidential Information" in its
possession.
The parties must meet and confer in a good faith
effort to reach an agreement regarding the reasonable attorney's
fees that Unapen incurred in collecting the unpaid amounts.
If
the parties are unable to reach an accord despite their diligent
efforts, Unapen may file a fee application for the court's
consideration no later than April 30, 2014.
This is not a recommended ruling.
The parties have
consented to trial before a magistrate judge pursuant to 28
U.S.C. 636(c) and Fed. R. Civ. P. 73.
(Doc. #82.)
SO ORDERED at Hartford, Connecticut this 31st day of
March, 2014.
________________/s/___________
Donna F. Martinez
United States Magistrate Judge
22
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