Johnson v. The Capital Offset Company, Inc. et al

Filing 111

ORDER denying 89 Motion for Summary Judgment. So Ordered by Judge Joseph A. DiClerico, Jr.(dae)

UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF NEW HAMPSHIRE

Alford Johnson as Trustee
of the Martha Wood Trust
v.

Civil No. 11-cv-459-JD
Opinion No. 2013 DNH 128

The Capital Offset Company, Inc.,
Jay Stewart, Stephen Stinehour,
and Acme Bookbinding Company, Inc.
O R D E R
Alford Johnson, as the trustee of the Martha Wood Trust,
brought suit against The Capital Offset Company, Inc.; its
president, Jay Stewart; a consultant who later worked for Capital
Offset, Stephen Stinehour; and Acme Bookbinding Company, alleging
claims arising from the publication of a photography book,
Spiritual Passports.1

Stinehour moves for summary judgment on

Johnson’s claims against him.

Johnson objects.

In his reply, Stinehour states that he “incorporates by
reference the arguments of Capital Offset and Jay Stewart as to
the opinions of plaintiff’s ‘experts’ Donald Mazzella, Susan Cox
and Frank Biancalana . . . .”

As is discussed in the orders on

the motions for summary judgment filed by Capital Offset and

1

Capital Offset’s third-party claims against Susan Cox have
been resolved on summary judgment.

Stewart and Acme, Mazzella was not shown to have scientific,
technical, or specialized knowledge that would allow him to give
opinions about the methods and technical processes of
bookbinding.

For that reason, his opinion about the effect of

the absence of glue traps was not considered.

The opinions of

Cox and Biancalana were not properly challenged and, therefore,
were not restricted.
Johnson did not respond to Stinehour’s reference to the
expert testimony issue.

For the reasons stated in the prior

orders on summary judgment, Mazzella’s opinion on the effect of
the absence of glue traps will not be considered for purposes of
Stinehour’s motion for summary judgment.

Standard of Review
Summary judgment is appropriate when “the movant shows that
there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”
P. 56(a).

Fed. R. Civ.

“On issues where the movant does not have the burden

of proof at trial, the movant can succeed on summary judgment by
showing ‘that there is an absence of evidence to support the
nonmoving party’s case.’”

OneBeacon Am. Inc. Co. v. Commercial

Union Assurance Co. of Canada, 684 F.3d 237, 241 (1st Cir. 2012)
(quoting Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986)).
2

In deciding a motion for summary judgment, the court draws
“all reasonable inferences in favor of the non-moving party while
ignoring conclusory allegations, improbable inferences, and
unsupported speculation.”

Pruco Life Ins. Co. v. Wilmington Tr.

Co., 721 F.3d 1, 6-7 (1st Cir. 2013) (internal quotation marks
omitted).

“A genuine issue is one that can be resolved in favor

of either party, and a material fact is one which has the
potential of affecting the outcome of the case.”

Jakobiec v.

Merrill Lynch Life Ins. Co., 711 F.3d 217, 223 (1st Cir. 2013).

Background
Johnson, as trustee of the Martha Wood Trust, began working
on a project to produce a book of photographs that had been taken
by Johnson’s wife, Martha Wood, shortly before her death.
Johnson hired Susan Cox to work with him on the design and
production of the book.
project with Cox.

Frank Biancalana also worked on the

The photography book is titled Spiritual

Passports.
Cox and Biancalana had previously had another book printed
by Stephen Stinehour at Stinehour Press.

Stinehour worked with

Johnson, Cox, and Biancalana during the Spiritual Passports

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project.2

In 2007, Stinehour recommended that Johnson hire

Capital Offset to print Spiritual Passports, which he did.
Stinehour became an employee of Capital Offset in January of
2008.

Although Stinehour remembers telling Cox in the fall of

2008 that he was working for Capital Offset, Cox represents that
she first learned of Stinehour’s employment at Capital Offset in
a letter from Stinehour dated January 17, 2009.

Johnson first

learned of Stinehour’s employment at Capital Offset in August of
2009 during the printing of Spiritual Passports.

Stinehour was

also involved in Capital Offset’s decision to hire Acme to bind
Spiritual Passports.
Johnson contends that most of the books produced have
defects in the printing or binding.

Stinehour contends that the

majority of the books are properly printed and bound.

Discussion
Johnson brings claims of negligence, negligent
misrepresentation, intentional misrepresentation, and breach of
fiduciary duty against Stinehour.
judgment on all claims against him.

Stinehour moves for summary

2

Johnson objects.

Johnson cites to pages of his deposition testimony that
were not submitted with his objection to support his statement
that Stinehour was hired as an independent consultant.
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A.

Negligence - Count III
Johnson alleges that Stinehour owed a duty to him to

exercise reasonable care in selecting a printer and a binder for
Spiritual Passports and that he breached that duty in selecting
Capital Offset and Acme.

In support of summary judgment,

Stinehour notes that motions to dismiss the negligence claims
filed by Capital Offset and Acme were granted.

Stinehour then

states only:
To the extent that any negligence claim relating to the
printing and/or binding of the Spiritual Passports
books [sic], Stephen Stinehour respectfully requests
summary judgment as to those counts where the plaintiff
has not demonstrated that Stephen Stinehour had a duty
to control the actions of Capital Offset and/or Acme
Bookbinding with respect to the printing and binding of
these books in his position as a sales representative.”
Doc. no. 89 at 7.
Capital Offset and Acme moved to dismiss the negligence
claim against them based on the economic loss doctrine.

Johnson

then agreed to dismiss the negligence claim as to them.

Although

Stinehour moved to dismiss the breach of fiduciary duty claim
against him, he did not move to dismiss the negligence claim.
Stinehour’s brief statement challenging the negligence
claim, without any citation to a legal standard or to record
facts, is insufficient to raise the issue for summary judgment.

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B.

Negligent Misrepresentation
Under New Hampshire law, the elements of a negligent

misrepresentation claim are “a negligent misrepresentation of a
material fact by the defendant and justifiable reliance by the
plaintiff.”

Wyle v. Lees, 162 N.H. 406, 413 (2011).

Negligence

is based on “the duty of one who volunteers information to
another not having equal knowledge, with the intention that he
will act upon it, to exercise reasonable care to verify the truth
of his statements before making them.”

Id.

A misrepresentation

is made when a defendant knew or should have known that his
statements were false.

Id.

In addition, the misrepresentation

must have caused the plaintiff harm or injury, or stated in other
terms, the plaintiff must have reasonably relied on the
misrepresentation to his detriment.

See id.; Snierson v.

Scruton, 145 N.H. 73, 78 (2000); BAE Sys. Information & Elecs.
Sys. Integration Inc. v. SpaceKey Components, Inc., 2011 WL
5040705, at *14 (D.N.H. Oct. 24, 2011).
Stinehour asserts that Johnson admitted that Capital Offset
and Acme were qualified to print and bind the books.

The cited

support for that statement, Johnson’s responses to requests for
admissions, however, is contrary to Stinehour’s representation.
Johnson denied that Capital Offset and Acme were qualified to
print and bind the books.
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Stinehour also asserts that he did not misrepresent the
quality of the books after they were printed and bound and that
Johnson had an opportunity to inspect the books himself.

As is

explained more fully in the order on the motion for summary
judgment filed by Capital Offset and Stewart, Johnson’s visit to
Acme during the binding process, without Cox and Biancalana, does
not undermine his reliance on representations made by Stinehour.
Therefore, a factual dispute precludes summary judgment.

B.

Intentional Misrepresentation
Stinehour moved for summary judgment on negligent and

intentional misrepresentation together.

In support, he states:

“Although the claims are not exactly the same, the defenses of
Stephen Stinehour are substantially similar to Capital Offset’s
and Jay Stewart’s in that he did not misrepresent the quality of
the books - there is a dispute as to the quality of the books
better resolved through contract law than through tort.”
at 6.

Doc. 89

As such, Stinehour has not shown that he is entitled to

summary judgment on Johnson’s intentional misrepresentation
claim.

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C.

Breach of Fiduciary Duty
Stinehour contends that he did not breach his fiduciary duty

to Johnson because he “recommended a printing company that
plaintiff admits was competent to print the job and a binding
company that plaintiff admits was competent to bind the job.”3
Doc. no. 89 at 5.

Stinehour explains, confusingly, that his

“recommendation would not have presented any problem absent the
plaintiff’s claim of breach of contract, and absent plaintiff’s
claims regarding the quality of some of the books produced, there
would be no claim.”

Id.

Stinehour further contends, citing

Seymour v. N.H. Savings Bank, 131 N.H. 753 (1989), that he merely
recommended Capital Offset and Acme based on his knowledge of
their work at the time.
In response, Johnson asserts that in the role of a
fiduciary, Stinehour was obligated to put Johnson’s best
interests ahead of his own self interest, citing Brzica v. Trs.
of Dartmouth College, 147 N.H. 443, 447 (2002).

Johnson contends

that Stinehour was more interested in serving his own interests
and Capital Offset’s interests in his recommendations than he was
in providing good advice about who should print and bind

3

Stinehour acknowledges that he owed Johnson a fiduciary
duty in providing advice on who should print and bind Spiritual
Passports.
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Spiritual Passports.

Johnson also contends that Stinehour made

many of the misrepresentations about the quality of the books and
acceptable practices during the inspection process.
Johnson contends that Seymour does not apply under the
circumstances of this case.

In Seymour, the plaintiffs applied

for a construction loan from the defendant bank and began the
process of hiring a contractor to do the work.

131 N.H. at 754.

When the plaintiffs told a loan officer at the bank which
contractor they were considering for the job, the officer
remarked that the contractor had a fine reputation.

Id. at 755.

The bank granted the loan application, and the plaintiffs hired
the contractor they had discussed with the loan officer.

Id.

When the plaintiffs had misgivings about the work the
contractor was doing, before authorizing a fourth payment, they
asked a vice president at the bank when the bank would inspect
the project, and he replied that the inspection would be done on
completion because of the contractor’s good reputation.

Id.

The

vice president also recommended that the plaintiffs pay the
contractor because he was working on the project.

Id.

Ultimately, the plaintiffs were not satisfied with the
contractor’s work.

Id.

The plaintiffs sued the bank for breach of contract and
breach of fiduciary duties.

Id. at 756.
9

The trial court denied

requests for findings that the bank recommended the contractor
and led the plaintiffs to believe they could rely on inspections
of the project by the bank.

Id. at 758.

Further, the bank made

the payments to the contractor on behalf of the plaintiffs, not
for its own benefit.

Id.

Therefore, no breach of fiduciary duty

was found.
In this case, unlike the situation in Seymour, Stinehour was
hired to advise Johnson about who should print and bind the book.
There is no dispute that Stinehour owed Johnson a fiduciary duty
to provide advice that was in Johnson’s best interests.

During

his work with Johnson, however, Stinehour accepted a job at
Capital Offset which arguably created divided loyalties.

Factual

disputes about Stinehour’s advice preclude summary judgment on
the breach of fiduciary duty claim.

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Conclusion
For the foregoing reasons, the defendant’s motion for
summary judgment (document no. 89) is denied.

SO ORDERED.

____________________________
Joseph A. DiClerico, Jr.
United States District Judge
September 25, 2013
cc:

Jennifer Turco Beaudet, Esquire
Lawrence F. Boyle, Esquire
Matthew Joseph Delude, Esquire
Elsabeth D. Foster, Esquire
Thomas J. Pappas, Esquire
Mark W. Shaughnessy, Esquire
William N. Smart, Esquire

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