`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 nggleggm
`DOCUMENT
`ELECTRONICALLYFILED
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`UNITED STATES DISTRICT COURT
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`SOUTHERN DISTRICT OF NEW YORK
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`"'£{{s';;ii§1}};¥,"""""""""""""""""""""X
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`DOC#
`DATE FILED:
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`{at 6 3i wt 7
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`Plaintiff,
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`1:14-cv—9661
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`-against-
`CG Technology, L.P.,
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`.
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`MEMORANDUM & ORDER
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`Defendant.
`____________________________________________________________x
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`ANDREW L. CARTER, JR., United States District Judge:
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`Plaintiff Russell Slifer brought suit against Defendant CG Technology, L.P., alleging
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`breach of contract and breach of implied covenant of good faith and fair dealing over a contract
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`entitled the Patent Assignment Agreement. From January 9, 2017 to January 17, 2017, the
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`Court presided over a jury trial over these claims. At the close of arguments and before the case
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`was submitted to the jury, Defendant moved pursuant to Fed. R. Civ. P. 50(a) for judgment as a
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`matter of law; the Court reserved judgment on the motion pending the jury’s verdict. On
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`January 17, 2017, the jury returned a unanimous verdict in favor of Plaintiff Russell Slifer
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`against Defendant CG Technology, L.P. After the verdict was returned, Plaintiff sought to
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`modify the jury’s verdict and moved to include equitable relief and equitable judgment in the
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`final judgment. Specifically, Plaintiff asks the Court to order Defendant to return the patent at
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`issue in this case to Plaintiff, rescind the Patent Assignment Agreement, order Defendant to pay
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`prejudgment interest, and, refuse to grant a stay pending further motions or appeal.
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`Defendant timely moved pursuant to Fed. R. Civ. P. 50(b) to renew its Rule 50(a) motion
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`for judgment as a matter of law altering or amending the judgment rendered by the jury on the
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`grounds that the jury had no legally sufficient evidentiary basis for its damages verdict.
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`Defendant asks the Court to enter judgment as a matter of law in favor of Defendant, setting
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 2 of 18
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`aside the damages based on Plaintiff s damages model and claim for breach of the implied
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`covenant of good faith and fair dealing as impermissible.
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`In the alternative, Defendant seeks an
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`order directing a new trial on damages pursuant to Fed. R. Civ. P. 59(a).
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`For the reasons set forth below, the Court grants Plaintiffs motion in part and denies
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`Defendant’s motion in its entirety.
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`I.
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`BACKGROUND
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`In 2008, Plaintiff and Defendant executed a Patent Assignment Agreement (“the
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`Agreement”), governed by New York law. Def.’s Counter-Statement of Undisputed Material
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`Facts (Def’s Stmt.) 1i 3; Slifer Decl. Ex. 10 11 11. Under the Agreement, Plaintiff assigned his
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`rights to two patents to Defendant in exchange for specified payment terms.
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`Id. 1i 5.
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`In part,
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`those terms provide for the immediate payment to Plaintiff of $50,000. 11. ii 8. Defendant
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`made that initial payment.
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`Id.
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`Paragraph 3(d) of the Agreement contains additional payment terms. It states:
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`If Seller has been paid less than one hundred thousand dollars ($100,000.00) during
`the time period from the Effective Date to sixty months after the Effective Date,
`Cantor shall, in Cantor’s sole and exclusive discretion, either (i) assign back to
`Slifer all of Cantor’s right, title and interest in the Patent Rights, or (ii) pay
`Minimum Royalty Payments each year beginning at the end of sixty months from
`the Effective Date of this Agreement (but for the avoidance of doubt in no event
`will more than the Maximum Amount in the aggregate ever be paid to Seller).
`Minimum Royalty Payments means $50,000.00 per year provided the Patent Rights
`have not been invalidated, rendered unenforceable, or rendered incapable of
`generating net Income, and Minimum Royalty Payments means $0 otherwise.
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`Slifer Decl. Ex. 10 1] 3(d).
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`Paragraph 3(b) establishes additional compensation to Plaintiff beyond 3(a)’s initial
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`payment.
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`It labels that compensation as “royalties” and sets it at ten percent of Defendant’s
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`2
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 3 of 18
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`revenue from the patents. Paragraph 3(0) establishes a formula for the calculation of revenue
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`(and thus, royalties) in specific transactions. Finally,paragraphs 3(6) and (f) set additional
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`obligations on Defendant to refrain from selling its rights to the patents unless royalties are paid
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`to Plaintiff and to provide Plaintiff with an accounting of Defendant’s annual revenue, for the
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`purpose of verifying correct payment of royalties.
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`Defendant never made a Minimum Royalty Payment as defined in paragraph 3(d) of the
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`Agreement, nor did it provide Plaintiff With an accounting of the annual revenue. Def’s Stmt. 1]
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`11. Nor had it assigned back to Plaintiff its right, title, and interest in the patents. Li. ‘1] 12.
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`Instead, Defendant sent Plaintiff a check for $50,000 in August 2013.
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`Id. 11 35. Summing the
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`original $50,000 payment made immediately to Plaintiff when the Agreement was signed and the
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`additional $50,000 payment made five years later, Defendant asserted that it had performed its
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`obligation to pay “$100,000[] during the time period from the Effective Date to sixty months
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`after the Effective Date .
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`.
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`. .” Li. 1111 36—7; Slifer Decl. Ex. 10 11 3(d).
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`Plaintiff sued Defendant, alleging breach of contract and breach of the implied covenant
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`of good faith and fair dealing. The case proceeded to trial on both claims. At trial, Defendant
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`argued that it had complied with the Agreement. Defendant asserted that because the plain
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`language of Paragraph 3(d) of the Agreement speaks only ofthe payment of “less than one
`hundred thousand dollars ($100,000.00) during the time period from the Effective Date to sixty
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`months after the Effective Date. .
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`. .” and it therefore, says nothing of the origin of the funds used
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`to make that payment, the payment to Plaintiff could come from any source. Plaintiff averred
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`that Paragraph 3(d) required Plaintiff to receive royalty payments derived from profits Defendant
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`received from utilizing the assigned patents. Because the $100,000 paid to Plaintiff did not
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 4 of 18
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`come from royalties, Defendant had breached the Agreement. Furthermore, because Defendant
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`construed the Agreement in such a way as to deprive Plaintiff of the benefit of his bargain,
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`Defendant had breached the implied covenant of good faith and fair dealing.
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`At the conclusion of the trial, the Court held a hearing on the jury instructions and verdict
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`form. During the hearing on the verdict form, the parties disagreed over how the jury should be
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`charged on damages. Specifically, with regard to damages and remedies, Defendants” proposed
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`jury verdict form (ECF No. 110—1) in the relief section asked the jury if Plaintiff Russell Slifer
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`was entitled to l) monetary damages and, if so, what amount; and/or 2) equitable remedies.
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`In its first draft, the Court adopted the balance of Defendant’s proposed jury verdict form
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`and included the section on relief. During the hearing, however, Defendant objected to their
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`own language and argued that this articulation was “bordering on rescission, which is a legal
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`ruling that must come from the Court. And it’s an equitable ruling that must come from the
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`Court.
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`It can’t come from the jury. And so dictating the manner in which the jury could award
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`that .
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`.
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`. is misleading and invading the province of the jury to decide what the damages might
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`be.” Trial Tr. 692:7-13, Jan. 13, 2017. The Court then specifically offered Defendant the
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`opportunity to amend the general damages provision in the jury verdict form to provide for 1)
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`“return of the patent” and 2) monetary damages in order to get “clear elucidation from the jury as
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`to how they’re awarding damages” in anticipation of “post-trial litigation about [damages]” and
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`“to perhaps avoid. . .having another trial on this damages issue.” Tr. 693:21- 694:2. Defendant
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`found the Court’s suggestion to be problematic because it gave the jury an option, returning the
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`patent to Plaintiff, that the Defendant believed the jury was not authorized to do. Tr. 694:4-5.
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`Later, Defendant offered the following amendment to the jury verdict form: (1) for money
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`4
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 5 of 18
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`damages relating to return of the patent and (2) for money damages relating to circumstances
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`other than return of the patent. Tr. 705: 10—13; 707:22-25. Plaintiff opposed this formulation on
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`the grounds that it presented jurors with an either/or proposition when, in fact, Plaintiff could
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`receive “both damages in this case.” Tr. 708:8—9.
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`The Court additionally proposed that for further clarity on the issue of damages, the jury
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`verdict form provide one damages section for the breach of contract claim and a separate
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`damages section for the covenant of good faith and fair dealing claim. Tr. 708:17-23.
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`Defendant opposed the proposal, saying “having two different damages section[s] related to the
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`two different counts might confuse the jury.
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`I think everybody is on the same page there’s only
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`going to be one damages award, if any, in the case, and that would come from the choices that
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`we just discussed in the damage section.” Tr. 70924-8. The Court adopted the Defendant’s
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`proposed amendment to the jury form: (1) damages for failure to return the patent; and (2)
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`damages for some other reason. Tr. 709:4.
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`After the hearing, the Court instructed the jury at length on both the breach of contract
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`and breach of implied covenant of good faith and fair dealing. See Court Ex. 1 (Jury Charge) at
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`25-27, ECF No. 186. With regard to damages, the Court instructed the jury on compensatory
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`damages. Li. at 28—29. Specifically, the Court instructed the jury that if it found “that the
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`plaintiff has established breach of contract by a preponderance of the evidence, [it] should award
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`money damages that would place the plaintiff back in the same position he would have been in
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`had the defendant performed as obligated under the contract.” Id. at 29. Next, the Court
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`instructed the jury on calculating damages for a “breach that substantially defeats the purpose of
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 6 of 18
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`the contract.” BL With regard to this type of breach, the Court instructed the jury, in relevant
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`part, as follows:
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`A breach that substantially defeats the purpose of the contract, however,
`may justify calculating damages differently based on the amount of gain that the
`defendant wrongfully obtained. Accordingly,
`if you find that defendant’s
`breaching conduct substantially defeated the purpose of the Agreement, you may
`calculate damages either based an expectation damages theory or a restitution
`theory. Under either theory, in the absence of a readily available market price, the
`value the parties assign to a benefit may be the best valuation measure.
`Under an expectation damages theory, you can award Plaintiff what you
`find he would have received had Defendant not breached the contract. Here,
`although Defendant could have chosen to make Minimum Royalty Payments
`instead of transferring the Patents back to Mr. Slifer, it had to do that by August
`2013. Therefore, you would calculate how much Mr. Slifer would have been able
`to receive or earn had the Patents been assigned back to him on August 29, 2013.
`Under the restitution theory, you would award Mr. Slifer the value of the
`property conveyed to Defendant, minus the value of what Defendant has already
`paid him. So under this theory, you would award Mr. Slifer the amount of money
`you think CG Technology has gained from the Patents.
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`151; at 29-30.
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`The Court also provided a jury verdict questionnaire with seven questions. Court EX. 2
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`(Verdict Form), ECF No. 187.
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`In relevant part, the questionnaire asked the jury if it was 1)
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`“awarding damages based on Defendant’s failure to return the Patent” and, if so, how much; and
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`2) “awarding damages for some other reason” and, if so, how much. Li. at 3. The jury found
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`that Defendant breached the Agreement as well as the covenant of good faith and fair dealing.
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`1d, The jury awarded $250,000 for “Defendant’s failure to return the Patent” and $150,000 “for
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`some other reason.’
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`1d, at 3. The Court entered judgment in accordance with the jury’s verdict
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`9
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`(ECF No. 189) and the parties subsequently filed the present motions.
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 7 of 18
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`II.
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`DEFENDANT’S MOTION FOR JUDGMENT AS A MATTER OF LAW
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`Defendant argues that the Court should exercise its power under Rule 50 to strike the
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`“other” category of damages awarded by the jury and reduce the judgment from $400,000 to
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`$250,000 for two reasons. First, Defendant contends that the jury did not have a “legally
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`sufficient evidentiary basis” to render a verdict over $250,000. Second, Defendant asserts that
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`Plaintiff 5 claim for breach of the implied covenant of good faith and fair dealing was duplicative
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`of his breach of contract claim and therefore could not have been the basis for a damages award.1
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`A. Legal Standard
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`Fed. R. Civ. P. 50(b) provides that “[i]f the court does not grant a motion for judgment as
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`a matter of law” after a party has been heard fully at trial, that party “may file a renewed motion
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`for judgment as a matter of law and may include an alternative or joint request for a new trial
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`under Rule 59.” Fed. R. Civ. P. 50(b). The Court may properly grant a motion for judgment as
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`a matter of law under Rule 50(b) “only if there is ‘such a complete absence of evidence
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`supporting the verdict that the jury's findings could only have been the result of sheer surmise
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`and conjecture, or such an overwhelming amount of evidence in favor of the movant that
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`reasonable and fair minded [persons] could not arrive at a verdict against [the moving party].’”
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`Stratton v. Dep't for the Aging for the City of N.Y., 132 F.3d 869, 878 (2d Cir. 1997) (quoting
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`LeBlanc—Sternberg v. Fletcher, 67 F.3d 412, 429 (2d Cir. 1995)). When deciding a Rule 50(b)
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`motion, “a district court is required to ‘consider the evidence in the light most favorable to the
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`In its motion for a new trial, Defendant makes essentially the same argument that the implied covenant claim
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`should not have gone to the jury. The Court will address the argument that the implied covenant claim was
`redundant in Section III of this Memorandum.
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 8 of 18
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`party against whom the motion was made and to give that party the benefit of all reasonable
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`inferences that the jury might have drawn in his favor from the evidence?” LeBlanc—
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`Sternberg, 67 F.3d at 429 (quoting Smith v. Lightning Bolt Prods, Inc., 861 F.2d 363, 367 (2d
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`Cir. 1988)).
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`A court should not grant a Rule 50(b) motion “unless the evidence, viewed in the light
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`most favorable to the nonmoving party, is insufficient to permit a reasonable juror to find in his
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`favor.” Arlio v. Lively, 474 F.3d 46, 51 (2d Cir. 2007).
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`“[T]he court must give deference to all
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`credibility determinations and reasonable inferences of the jury, and it may not itself weigh the
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`credibility of witnesses or consider the weight of the evidence.” Galdieri—Ambrosini v. Nat'l
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`Realty & Dev. Com., 136 F.3d 276, 289 (2d Cir. 1998).
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`In considering the motion, a court
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`should defer tothe jury's role as the trier of fact.
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`_S_ee Fabri v. United Technologies Int'l
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`m, 387 F.3d 109, 119 (2d Cir. 2004) (holding that a court “cannot assess the weight of
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`conflicting evidence, pass on the credibility of the witnesses, or substitute its judgment for that of
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`the jury.”); Meloffv. New York Life lns. Co. 240 F.3d 138, 145 (2d Cir. 2001). Thus,
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`“judgment as a matter of law should not be granted unless (1) there is such a complete absence of
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`evidence supporting the verdict that the jury's findings could only have been the result of sheer
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`surmise and conjecture, or (2) there is such an overwhelming amount of evidence in favor of the
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`movant that reasonable and fair minded [persons] could not arrive at a verdict against [it].”
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`Advance Pharm. Inc. V. United States 391 F.3d 377, 390 (2d Cir. 2004) (quoting Galdieri—
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`Ambrosini v. Nat'l Realty & Dev. Corp, 136 F.3d 276, 289 (2d Cir. 1998)).
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 9 of 18
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`B. Sufficiency of the Evidence
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`Within this framework, the Court considers Defendant’s argument that it is entitled to
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`judgment as a matter of law because the jury’s verdict was not supported by the evidence. The
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`Court’s review of the record indicates that there is substantial evidence in support of the damages
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`award.
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`Defendant first argues that the jury was not presented with evidence that could support its
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`damages award, asserting that Plaintiff failed to adduce any evidence at trial that could provide
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`legal justification for an award beyond “the contractual cap of $250,000” because the cap on
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`royalties pursuant to the Agreement operates as a cap on damages. Furthermore, Defendant
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`contends that the jury was not entitled to award Plaintiff lost profits because under New York
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`law, lostprofits had to have been contemplated by the parties. Robin Bay v. Merrill meh &
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`Co., 07 Civ. 376(JMB), 2008 WL 2275902, at *7 (S.D.N.Y. June 2, 2008) (“[t]o recover lost
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`profits, the plaintiff must show that the alleged loss is capable of proof with reasonable
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`certainty”). Defendant asserts that the parties did not contemplate lost profits when they signed
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`the Agreement in 2008. Def. Mem. Supp. Mot. JMOL/New Trial at 6. Therefore, any damages
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`award in excess of $250,000 is inherently speculative and therefore should be stricken by the
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`Court.
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`The Court’s review of the record indicates that there was more than ample evidence from
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`which the jury could properly award “other” damages over and above $250,000. Plaintiff’s
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`expert, Harry Gwinnell, testified regarding the specific amount of Plaintiff s damages.
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`Although Defendant argues that it was prejudiced by Gwinnell’s testimony, in which he opined
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`that Defendant caused Plaintiff to incur economic loss in the amount of $3,068,780.00, Plaintiff
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 10 of 18
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`properly disclosed Gwinnell as an expert witness to Defendant pursuant to Fed. R. Civ. P.
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`26(a)(2) and Gwinell’s testimony as to the amount of specific damages was based solely on
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`evidence admitted at trial. His testimony reflected a simple computation based on evidence
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`already in, or about to be in, the trial record.
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`It was the jury’s role to determine the reliability
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`and weight of his testimony, and the Court was well within its discretion to allow the jury to
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`consider it. Given this testimony and the corroborating evidence, when viewed in the light most
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`favorable to the nonmoving party, there was sufficient evidence from which the jury could
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`properly conclude that “other” damages over and above $250,000 were warranted.
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`III.
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`DEFENDANT’S MOTION FOR A NEW TRIAL
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`A. Legal Standard
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`In the alternative, Defendant moves for a new trial pursuant to Fed. R. Civ. P. 59(a).
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`In
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`contrast to a motion for judgment as a matter of law, “a motion for a new trial pursuant to [Rule]
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`59 may be granted .
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`.
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`. although there is evidence to support the jury's verdict, so long as the district
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`court determines that, in its independent judgment, ‘the jury has reached a seriously erroneous
`9”
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`result or [its] verdict is a miscarriage ofjustice.
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`Nimely V. City of N.Y., 414 F.3d 381, 392 (2d
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`Cir. 2005) (quoting Munafo v. Metro. Transp. Auth., 381 F.3d 99, 105 (2d Cir. 2004)).
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`In
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`deciding a motion for a new trial, “the district court [is] free to examine the evidence through its
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`own eyes.” Meloff V. N.Y. Life Ins. Co. 240 F.3d 138, 147 (2d Cir. 2001).
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`“While the Court
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`need not necessarily weigh the evidence in the light most favorable to the non-moving party,
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`disagreement with the verdict alone is insufficient to justify ordering a new trial.” Muller v.
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`Costello 997 F.Supp. 299, 302 m.D.N.Y. 1998).
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`B. Analysis
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 11 of 18
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`Defendant provides four grounds for its motion pursuant to Rule 59(a). First, Defendant
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`claims that Plaintiff‘s damages model was speculation that tainted the jury verdict and requires a
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`new trial. The Court disagrees, since on the proof presented, Defendant cannot demonstrate that
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`the jury has reached a seriously erroneous result or that the verdict is a miscarriage ofjustice.
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`In
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`this case, the j ury’s verdict on damages was fully consistent with the weight ofthe evidence, which,
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`based upon its verdict, the jury found to be credible. Thus, Defendant’s motion for a new trial
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`based on this argument is denied.
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`Second, Defendant contends that the Court erred in allowing Plaintiff to present evidence
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`of Defendant’s use of the patent because it only served to confuse the jury and produce a seriously
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`erroneous result. The Court disagrees with Defendant’s belief that Defendant’s use of the patent
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`was irrelevant since whether Defendant was using the patent was central to determining whether
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`Defendant had breached the Agreement in any way. Defendant” 5 use of the patent very well could
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`have some additional relevance in calculating damages because its use or non-use could establish
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`the potential value of the patent and its potential profitability. Thus, no new trial is warranted on
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`these grounds.
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`Third, Defendant argues that Plaintiffs claim for breach of the implied covenant of good
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`faith and fair dealing was not sufficiently unique from his breach of contract claim, and therefore
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`should not have gone to the jury.
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`In order to simultaneously allege “breach of contract and
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`implied covenant claims under New York law, a plaintiff must allege an implied duty that is
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`consistent with the express contractual terms, but base its implied covenant theory on allegations
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`that are distinct from the factual predicate for its contract claims.” JPMorgan Chase Bank, NA.
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`v. IDW Group, LLC, No. 08 Civ. 9116, 2009 WL 321222, at *5 (S.D.N.Y. Feb. 9, 2009). Thus,
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 12 of 18
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`“a plaintiff adequately states an implied covenant claim by alleging conduct that subverts the
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`contract's purpose without violating its express terms.” Id,
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`In patent assignment cases where the
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`compensation contemplates royalty payments, there is an implied duty to “work the patent.” See
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`Dwight & Lloyd Sintering Co. V. American Ore Reclamation C0,, 44 F.Supp. 391, 393 (S.D.N.Y.
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`1 937).
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`The substance of Plaintiff s implied covenant claim is that Defendant did not use the patent
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`in a manner to generate royalties that would go to Plaintiff if the Defendant chose not to return the
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`patent, which did not violate any express term of the contract. Thus, it was not error for the Court
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`to instruct the jury that the covenant “may” exist in this case. The. Court properly instructed the
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`jury on the law and correctly charged the jury that the same set of facts and evidence could not
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`support both a breach of contract claim and breach of implied covenant claim.2 See New York
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`Pattern Jury Instructions — Civil 4:1 at 86 (2017). Based on the record at trial, the Court cannot
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`hold that it was seriously erroneous for the jury to have found a breach of the implied covenant
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`that would be unique from Plaintiff s breach of contract claim.
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`_S_e__e Bailey V. Chattem, Inc.,
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`684
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`F.2d 386, 396 (6th Cir. 1982) (holding that it was not error for the jury to find an implied duty of
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`good faith for patent assignee to use reasonably good efforts to market an invention pursuant to a
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`2 With regards to breach of the implied covenant of good faith and fair dealing, the Court instructed the jury, in
`relevant part, as follows:
`Moreover, the covenant is not duplicative of the parties’ obligations under the contract. Thus, to the extent
`that the evidence is the same for Plaintiffs breach of contract claim and breach of implied covenant of
`good faith and fair dealing claim, you cannot find a breach of the implied covenant and can only consider
`whether the evidence supports the breach of the contract claim. The covenant of good faith and fair dealing
`is breached when a party acts in a manner that deprives the other party of the benefits of the agreement.
`Where the contract contemplates the exercise of discretion, the implied covenant includes a promise not to
`act arbitrarily, irrationally or in bad faith in exercising that discretion.
`Court Ex. 1 (Jury Charge) at 26—27, ECF No. 186.
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 13 of 18
`Case 1:14-cv-09661-ALC—SN Document 227 Filed 06/13/17 Page 13 of 18
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`contract assigning patent rights). Therefore, Defendant’s application for a new trial on these
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`grounds is denied.
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`Finally, Defendant argues that the Court wrongly instructed the jury on the effect of
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`Paragraph 3(d) and erroneously identified the section as an option clause as follows:
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`Under an expectation damages theory, you can award plaintiff what you find he
`would have received had defendant not breached the contract. Here, although
`defendant could have chosen to make minimum royalty payments instead of
`transferring the patents back to Mr. Slifer,
`it had to do that by August 2013.
`Therefore, you would calculate how much money Slifer would have been able to
`receive or earn had the patents been assigned back to him on August 29, 2013.
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`Tr. 84921—85023 (emphasis added). Specifically, Defendant asserts that the charge deprived the
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`jury of the ability to find that Plaintiff would have received $250,000 in Minimum Royalty
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`Payments “and no more.” Def. Mem. Supp. Mot. JMOL/New Trial at 15-17. According to
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`Defendant, this problem arises from the Court’s conflation of Paragraph 3(d) as an option in the
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`colloquial sense with the legal term of art under New York law.
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`In support of its argument,
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`Defendant cites Kaplan v. Lippman, 75 N.Y.2d 320, 324 (NY. 1990) for the proposition that an
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`option only exists when the operative clause confers a unilateral right to purchase property at a
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`date certain. Defendant further relies on Seligson V. Russo, 300 A.D.2d 152, 153 (lst Dep’t 2002)
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`and Zora Realty Co. v. Green, 60 N.Y.S.2d 440, 445 (N.Y. Sup. Ct. Bronx Cnty. 1946) to assert
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`that “the law surrounding options contracts cannot be applied to agreements that do not fit the
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`narrow legal definition of an ‘option.”’ Def. Mem. Supp. Mot. JMOL/New Trial at 17.
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`Instead, Defendant asserts for the first time that Paragraph 3(d) is in fact an “alternative
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`6‘
`contract” because it conveys one party’s promis[e] to render some of two or more alternative
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`performances, either one of which is mutually agreed upon as the bargained-for equivalent given
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`13
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` t
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`23
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 14 of 18
`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 14 of 18
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`in exchange for the return performance by the other party.” 1; (citing Eagle Star Ins. Co. V.
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`Seneca Ins. Co., No. 94 CIV. 9106, 1995 WL 733642, at *3 (S.D.N.Y. Dec. 12, 1995)). As an
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`“alternative contract,” the Court should have instructed the jury that the proper remedy for
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`breach is the least burdensome remedy to the breaching party, which in the case at bar, would be
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`a payment of $250,000. Li. at 17-18 (citing Branhill Realty Co. V. Montgomefl Ward & Co., 60
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`F.2d 922, 923 (2d Cir. 1932) (“Where a promisor has agreed to alternative performances, in case
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`of breach without an election, the damages are measured by the alternative that will result in the
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`smallest recovery”) (emphasis added); see also 5A Corbin on Contracts § 1079 (1964) (“For
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`such a breach the measure of damages recoverable by the promisee is the value of that alternative
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`that is the least burdensome and expensive to the promisor.”). Defendant argues that the jury
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`instruction contradicted New York law because it prohibited the jury from calculating damages
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`according to the paradigm of the “least burdensome alternative” and resulted in a legally
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`unsupported damages award.
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`While Defendant’s statement of the law is correct with regard to the type of contract that
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`was breached in the present case, this does not change the fact that from the verdict sheet, it is
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`unclear whether the jury awarded the additional $150,000 to Plaintiff for breach of contract or
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`for breach of the implied covenant of good faith and fair dealing. The Court previously offered
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`Defendant the opportunity to amend the verdict sheet in a manner that would clarify whether any
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`verdict above and beyond $250,000 was for breach of contract, breach of the implied covenant of
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`good faith and fair dealing, or both. Defendant opposed the amendment, Tr. 709:4-8, and
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`invited that error. Under the invited error doctrine, the party that invited or provoked the district
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`court to commit a particular error may not complain of the error after the fact. Cassotto v.
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`14
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 15 of 18
`Case 1:14-cv-09661—ALC-SN Document 227 Filed 06/13/17 Page 15 of 18
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`Donahoe, 600 F. App‘x 4, 6 (2d Cir. 2015), as corrected (Jan. 14, 2015).
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`“Denying relief even
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`for plain errors where a defendant deliberately provokes a procedural irregularity, the invited
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`error doctrine seeks to avoid rewarding mistakes stemming from a defendant's own intelligent,
`
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`deliberate course of conduct in pursuing his defense.” United States v. Bastian 770 F.3d 212,
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`218 (2d Cir. 2014).
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`Additionally, as noted above, Defendant asserts for the first time in its present motion
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`that the Agreement is an “alternative contract,” rather than an option clause that requires specific
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`charging on damages. Even assuming, arguendo, that the Court committed error, Defendant did
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`not object to the jury instruction’s final formulation on the difference between the expectation
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`and restitution theory of damages. Defendant cannot raise this objection for the first time
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`pursuant to Rule 59(a). E Lavoie V. Pac. Press & Shear Co., a Div. of Canron Corp, 975 F.2d
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`48, 55 (2d Cir. 1992) (“Failure to object to a jury instruction or the form of an interrogatory prior
`
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`to the jury retiring results in a waiver of that objection”); Gonzalez V. Bratton 147 F.Supp.2d
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`180, 208 (S.D.N.Y. 2001) (“City Defendants never raised the issue
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`during any of the charging
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`conferences, nor did they express any request for instructions on these issues. Accordingly, these
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`matters are deemed waived”). Therefore, Defendant’s argument is waived and Defendant’s
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`motion for a new trial on this basis is denied. & Christensen v. County of Dutchess, 08 Civ.
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`9234, 2012 WL 12883776, at *2 (S.D.N.Y. 2012) (denying plaintiff‘s motion for a new trial
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`pursuant to Rule 59(a) because plaintiff failed to object to the Court’s jury instruction before
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`contending in its motion for the first time that the jury instruction should not have gone to the
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`jury), aff’d, 548 F. App”); 651, 653 (2d Cir. 2013).
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`15
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`Case 1:14-cv-09661-ALC-SN Document 227 Filed 06/13/17 Page 16 of 18
`Case 1:14-cv-09661-ALC—SN Document 227 Filed 06/13/17 Page 16 of 18
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`IV.
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`PLAINTIFF’S MOTION TO AMEND JUDGMENT
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`Plaintiff moves for an amended judgment that grants specific performance, rescission of
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`the Agreement, pre—judgment interest, and refusal to grant a stay pending further motions or
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`appeal. For the reasons set forth below, Plaintiff’ s applications for an amended judgment and
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`rescission are denied. Plaintiff s request for pre—judgment interest is granted. Plaintiff’s
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`request for a stay is denied.
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`Plaintiff first argues that the Court should award specific performance to Plaintiff in