Powderham v. Synergy Worldwide, Inc.
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Powderham v. Synergy Worldwide, Inc.
Case: Powderham v. Synergy Worldwide, Inc. (2010)
Subject Category: State cases, Utah, Distributor termination
Agency Involved: Private civil suit
Court: US District Court, Central Utah
Case Synopsis: Powderham, a British citizen, signed a 3-year contract to develop a European market for
Synergy. The contract allowed Synergy to terminate Powderham "at any time by giving thirty (30) days'
written notice if Company is dissatisfied..." Powderham established markets in Germany and Austria, the
United Kingdom and the Netherlands. Synergy terminated Powderham after a year and a half, citing
lower than expected sales, poor working relationships and failure to perform the services in the manner
expected. Powderham sued, alleging that the poor sales were Synergy's fault and that the reasons given
for his termination were pretextual.
Legal Issue: Does the contract allow the company to discharge the contractee without reason?
Court Ruling: No. The District Court pointed out that termination of Powderham was limited to
dissatisfaction, and that Utah uses an objective standard for judging contractual dissatisfaction. Synergy
must prove that they were justified in being dissatisfied with Powderham based upon their expectations
when the contract was signed. Synergy claimed that they were dissatisfied that Powderham did not
