Encompass Advisors, Ltd. v. Unapen, Inc. et al
ORDER granting 147 Motion for Reconsideration; granting in part and denying in part 148 Motion to Amend/Correct; denying 150 Motion to Alter Judgment. Signed by Judge Donna F. Martinez on 5/19/14. (Nichols, J.)
UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT
ENCOMPASS ADVISORS, LTD.,
UNAPEN, INC. et al.
CASE NO. 3:09CV1949(DFM)
RULING ON POST-TRIAL MOTIONS
Plaintiff brought this action alleging breach of a software
licensing contract, fraud and unfair trade practices against
defendants Unapen, Inc. and its officers David Gemma and Joan
Unapen counterclaimed for breach of contract.
four day bench trial, the court determined that plaintiff
breached the contract (doc. #144) and awarded damages of $26,125
and contractual attorney's fees to Unapen (doc. #146).
before the court are defendants' Motion for Reconsideration
(doc. #147), plaintiff's Motion to Amend/Correct Findings of
Fact & Conclusions of Law (doc. #148) and plaintiff's Motion to
Alter Judgment (doc. #150).
For the reasons that follow, the
Motion for Reconsideration and Motion to Amend/Correct are
GRANTED in part, and the Motion to Alter Judgment is DENIED.
Standard of Review
Plaintiff seeks amendment of the court's findings of fact
and conclusions of law under Fed. R. Civ. P. 52(b).1
In light of
the proposed amendments, plaintiff moves pursuant to Rule 59(e)
for entry of an amended judgment sustaining its CUTPA claim and
reducing its liability for damages on the counterclaim.2
Defendants seek reconsideration of the fee award under D. Conn.
L. Civ. R. 7(c).3
of these rules.
The standard of review is the same under each
See Taylor v. Housing Authority of New Haven,
No. 3:08CV557(JBA), 2010 WL 2801895, at *1 (D. Conn. July 14,
2010) (standard of review under Rule 52(b) mirrors standard
governing motions for reconsideration); Allstate Ins. Co. v.
Passaro-Henry, 660 F. Supp. 2d 317, 325 (D. Conn. 2009) (courts
consider motions under Rule 59(e) pursuant to same standard as
that governing motions for reconsideration).
"A Rule 52(b)
Rule 52(b) provides: "On a party's motion filed no later
than 28 days after the entry of judgment, the court may amend
its findings ‒ or make additional findings ‒ and may amend the
judgment accordingly. The motion may accompany a motion for a
new trial under Rule 59."
Rule 59(e) provides: "A motion to alter or amend a
judgment must be filed no later than 28 days after the entry of
Local Civil Rule 7(c)(1) provides: "Motions for
reconsideration shall be filed and served within fourteen (14)
days of the filing of the decision or order from which such
relief is sought, and shall be accompanied by a memorandum
setting forth concisely the matters or controlling decisions
which counsel believes the Court overlooked in the initial
decision or order."
motion will only be granted when the moving party can show
either manifest errors of law or fact, or newly discovered
New England Health Care Employees Welfare Fund v.
iCARE Management, LLC, 886 F. Supp. 2d 82, 92 (D. Conn. 2012)
(citation and quotation marks omitted).
The standard for
granting a motion for reconsideration or a Rule 59(e) motion to
alter judgment "is strict, and reconsideration generally will be
denied unless the moving party can point to controlling
decisions or data that the court overlooked — matters, in other
words, that might reasonably be expected to alter the conclusion
reached by the court."
Shrader v. CSX Transp., Inc., 70 F.3d
255, 257 (2d Cir. 1995) (citations omitted).
"The major grounds
justifying reconsideration are 'an intervening change of
controlling law, the availability of new evidence, or the need
to correct a clear error or prevent manifest injustice.'"
Virgin Atl. Airways, Ltd. v. Nat'l Mediation Bd., 956 F.2d 1245,
1255 (2d Cir. 1992) (quoting 18 Charles A. Wright, Arthur R.
Miller & Edward H. Cooper, Federal Practice and Procedure §
4478, at 790 (1981)).
Amended Finding of Fact
In his motions, plaintiff asks the court to amend several
of its factual findings and to amend the judgment accordingly.
First, plaintiff challenges the court's finding that
"[i]mplementation [of ClientLogix] 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."
(Doc. #144 at 9.)
Second, plaintiff challenges
the court's finding that "[b]ecause 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."
plaintiff challenges the court's finding that a particular
advertisement was not published until after the contract was
Amendment of the first two challenged findings is not
warranted because plaintiff has not identified any evidence that
the court overlooked or clear error that might justify
However, the third finding warrants amendment.
One of the central disputes at trial concerned Unapen's ability
to pull financial performance data from Schwab PortfolioCenter
into ClientLogix, the client management program that Unapen sold
In the Memorandum of Decision, the court found:
[I]n 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, [Ex.] 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.
(Doc. #144 at 7 n.1.)
This finding was based on defendants'
response to a request for admission, which was admitted into
evidence at trial as Plaintiff's Exhibit 10.
stated that the website did not contain that advertisement until
April 2007, three months after the contract was signed in
Plaintiff now points to additional testimony
elicited by counsel on cross examination of defendant Joan
(Doc. #134 at 139-40.)
Based on that testimony, the
court finds that Unapen did represent in 2006, prior to the
parties' contract, that ClientLogix could integrate with
Schwab's portfolio accounting system using powerful and proven
That amended finding does not alter the outcome of
plaintiff's CUTPA claim.4
Plaintiff demonstrated that it was the
The Connecticut Unfair Trade Practices Act ("CUTPA")
provides: "No person shall engage in unfair methods of
competition and unfair or deceptive acts or practices in the
conduct of any trade or commerce." Conn. Gen. Stat. § 42110b(a). To determine whether an act or 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)].
first registered investment advisor to purchase version 3.6 of
ClientLogix (doc. #134 at 140-41) but adduced no evidence
regarding the existence or performance of prior versions of
Lacking such evidence, the court is unable to
conclude that defendants' 2006 description of "powerful and
proven integration technology" was false or likely to mislead.
Additionally, although plaintiff was dissatisfied with several
aspects of the ClientLogix product that he received, that
program successfully integrated with PortfolioCenter between the
months of January 2007 and October 2007.
(Def.'s Ex. 11 at 5,
In short, plaintiff has not proved that defendants engaged
in "deceptive" acts or practices that satisfied the cigarette
Alteration of the judgment is not warranted.
Conclusion of Law
Plaintiff also argues that the court erred in awarding
$26,125 in actual damages because Unapen sought a lesser amount
in its pleadings.
The argument fails.
Rule 54(c) provides that
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)). For purposes of
CUTPA, an act or practice is "deceptive" if (1) defendants made
a material representation, omission, or other practice likely to
mislead consumers and (2) consumers interpreted the message
reasonably under the circumstances, and (3) the misleading
representation, omission, or practice was material ‒ that is,
likely to affect consumer decisions or conduct. Genworth
Financial Wealth Management, Inc. v. McMullan, No.
3:09CV1521(JCH), 2012 WL 1078011, at *12 (D. Conn. Mar. 30,
2012) (citing Caldor, Inc. v. Heslin, 215 Conn. 590, 597
every final judgment other than a default judgment "should grant
the relief to which each party is entitled, even if the party
has not demanded that relief in its pleadings."
GPIF-I Equity Co., Ltd. v. HDG Mansur Inv. Services, Inc., No.
1:13CV547(CM), 2014 WL 1612004, at *4 n.1 (S.D.N.Y. Apr. 21,
2014) (pursuant to Rule 54(c), plaintiff permitted to seek
additional damages not mentioned in complaint but related to the
Turning to the Local Rule 7(c) motion, defendants ask the
court to clarify the basis of the award of contractual
attorney's fees to Unapen.
There are two provisions in the
contract that pertain to attorney's fees.
Paragraph 6.2, which
concerns payment of invoices, provides in relevant part:
CUSTOMER will reimburse UNAPEN for all reasonable
costs incurred (including reasonable attorney's fees)
in collecting past due amounts.
(Pl.'s Ex. 1 at 4.)
Paragraph 11.16 provides:
The prevailing party in any legal action to enforce
this Agreement shall be entitled to recover its court
costs and reasonable attorney's fees.
(Id. at 8.)
Although the Memorandum of Decision omitted mention
of the latter, the award of attorney's fees to Unapen was based
on both provisions.
Unapen is entitled to the reasonable
attorney's fees incurred in collecting the amounts owing
pursuant to ¶ 6.2 and is entitled to its court costs and
reasonable attorney's fees incurred in this legal action
pursuant to ¶ 11.16.
Of course, to the extent that the
provisions overlap, Unapen is not entitled to a double recovery.
For the foregoing reasons, plaintiff's Motion to
Amend/Correct Findings of Fact & Conclusions of Law (doc. #148)
is GRANTED IN PART, and plaintiff's Motion to Alter Judgment
(doc. #150) is DENIED.
(doc. #147) is GRANTED.
Defendant's Motion for Reconsideration
The court will amend the judgment
pursuant to Rule 60(a) to clarify the fee award.
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 19th day of May,
Donna F. Martinez
United States Magistrate Judge
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