Golden v. Contour Enters. Intl.

1

James Golden v. Contour Enterprises Intl., Inc.

No. 218-2021-CV-00238

Superior Court of New Hampshire, Hillsborough

May 15, 2023

*Issued Under Seal*

ORDER ON DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

David A. Anderson, Associate Justice

Plaintiff James Golden filed suit on March 8, 2021, against Defendant Contour Enterprises Intl., Inc. alleging one count each of breach of contract, failure to pay wages, quantum meruit, and specific performance. Defendant now moves for summary judgment^[1] on Plaintiff's breach of contract quantum meruit, and specific performance claims.^[2] (Def's. Mot. Summ. J. (Doc. 47.)) Plaintiff objects. (Pl's. Obj. Def. Mot. Summ. J. (Doc 54.)) Defendant filed a further response to Plaintiff's objection. (Def's. Resp. (Doc. 64.)) Thereafter Plaintiff filed a surreply. (Pl's Surreply (Doc. 68.) The Court initially granted Defendant's Motion on January 19 2023 because Plaintiff failed to timely object. (Doc. 45.) The Court then ruled on March 9, 2023 that it would allow Plaintiff to file a late objection to Defendant's motions. (Doc. 58.) For the reasons stated below, the Court GRANTS Defendant's motion for summary judgment in part and DENIES it in part.

Fates

The following facts are undisputed unless otherwise noted and are drawn from the parties' consolidated statement of material facts and exhibits. (Doc. 62.) Steve Wang founded Defendant in 1995 to design, sell, and manufacture ergonomic computer mice. (Id. ¶ 1.) Defendant sold and manufactured its products worldwide and generated sales of over $20 million per year by 2020. (Id. ¶¶ 3-4.) Plaintiff started working for Defendant in 1996 as its Vice President of Sales and Marketing. (Id. ¶¶ 11-12.) Plaintiff's main job responsibilities remained consistent over the years as he provided oversight of Defendant's non-European sales and its marketing function. (Id. ¶¶ 12-13.)

In late 2019, Defendant began conversations with German computer company REDACTED about REDACTED potential acquisition of Defendant. (Id. ¶ 5.) Around that time, Wang told Plaintiff that REDACTED may acquire Defendant and that it had been valued at approximately (id. ¶ 14.) In October 2019, Plaintiff and

Wang further discussed the potential sale of Defendant REDACTED (Id. ¶ 15.) In particular, Wang informed Plaintiff that he wanted "to take care of the people that got me here, and this deal from REDACTED may go through and if it goes through, you know, you would get X." (Doc. 50, Ex. B at 24:20-24:22.) Wang further clarified for Plaintiff that "X" referred to REDACTED or roughly 2 percent of the company. (Doc. 62 ¶ 16.) Wang suggested that they should draft a contract to memorialize the deal but such a contract was never created. (Id. ¶¶ 17-18.) In November 2019, Plaintiff followed up with Wang about his promise, and Wang told him, "there's a lot of boxes built up in tech support and everything is all messed up here and, you know, I don't want to do it."

(Doc. 50, Ex. B at 28:23-29:1.) The parties dispute whether Wang formally revoked his promise to Plaintiff. Wang and Kenneth Schach, Defendant's employee, agreed that Schach would purchase warrants prior to the REDACTED acquisition. (Doc. 62 ¶ 56.) The REDACTED acquisition ultimately fell through by mid-2020. (Id. ¶ 6.) Defendant honored Schach's agreement even though the REDACTED deal did not happen. (Id. ¶ 57.)

In October 2020, REDACTED a Nordic private equity firm, approached Wang about potentially acquiring Defendant. (Id. ¶ 7.) In November 2020, Plaintiff conversed with Wang about receiving payment if Defendant was ultimately sold. (Id. ¶ 22.) During the conversation, Wang told Plaintiff, "I'll take care of you; don't worry about it. . . but wait for the deal to be done." (Doc. 50, Ex. B at 29:8-29:12.) Plaintiff testified at his deposition that Wang would not commit to a number but instead told him, "you'll be happy, don't worry about it. Just help me get the company sold, and then I'll take care of you after the deal's done." (Id. at 35:16-35:18.) Also during this conversation, Keyur Patel^[3] walked into the office and Wang told Patel, "we're just having a one-on-one conversation. He's been with me 25 years and I promised him two percent of the company." (Doc. 54, Ex. B at 33:22-34:5.) Plaintiff had no subsequent discussions with Wang about potential compensation regarding the REDACTED acquisition. (Doc. 62 ¶ 26.) REDACTED completed the acquisition of Defendant in spring 2021. (Id. ¶ 8.) REDACTED paid REDACTED acquire Defendant and Wang retained a 20% equity share in Defendant. (Id. ¶ 9.) Wang profited REDACTED from the sale to REDACTED (Id. ¶ 10.) Plaintiff never received any compensation after Defendant's acquisition and this lawsuit followed.

Analysis

To prevail on a motion for summary judgment, the moving party must establish that there is "no genuine issue as to any material fact" and that it is "entitled to judgment as a matter of law." Sabato v. Fed. Nat'l Mortg Ass'n, 172 N.H. 128, 131 (2019). The Court decides summary judgment motions by considering "the affidavits and other evidence, and all inferences properly drawn from them, in the light most favorable to the non-moving party." New London Hosp. Ass'n v. Town of Newport, 174 N.H. 68, 71 (2021). In order to defeat summary judgment, the non-moving party "must put forth contradictory evidence under oath sufficient to indicate that a genuine issue of material fact exists." Brown v. Concord Grp. Ins. Co., 163 N.H. 522, 527 (2012). "An issue of fact is 'material' for purposes of summary judgment if it affects the outcome of the litigation under the applicable substantive law." Crowe v. Appalachian Stitching Co., LLC, 174 N.H. 679, 682 (2021). "If there is no genuine issue of material fact, and if the moving party is entitled to judgment as a matter of law, the grant of summary judgment is proper." Cincinnati Specialty Underwriters Ins. Co. v. Best Way Homes, 175 N.H. 142, 146 (2022); see also RSA491:8-a, III.

I. Breach of Contract

There are two potential contracts at issue here, one related to the REDACTED acquisition and one related to the REDACTED acquisition. As to the REDACTED acquisition, Defendant argues that it is entitled to summary judgment as a matter of law on because Wang's promise to give Plaintiff REDACTED or two percent of the company was expressly conditioned on REDACTED successful acquisition of Defendant. (Doc.46 at 4-7.) Plaintiff argues that the discussion around the REDACTED acquisition showed that Wang wanted to provide Plaintiff compensation and thus creates a dispute of material fact. (Doc. 54 at 5-8.) As to the REDACTED transaction, Defendant contends that any promises Wang made regarding potential compensation were too indefinite to be enforceable. (Doc. 46 at 4-7.) Plaintiff argues there is a dispute of material fact over whether an enforceable agreement between Plaintiff and Wang exists because of the comments Wang made to Patel in Plaintiff's presence and Defendant's history of honoring similar deals conditioned on REDACTED successfully acquiring Defendant. (Doc. 54 at 5-8.)

"Under New Hampshire law, a breach of contract occurs when there is a failure without legal excuse to perform any promise which forms the whole or part of a contract." Teatotaller, LLC v. Facebook, Inc., 173 N.H. 442, 447 (2020) (quotation omitted). The party seeking to prove a breach of contract must do so by a preponderance of the evidence. See Audette v. Cummings, 165 N.H. 763, 770 (2013). "Offer, acceptance, and consideration are essential to contract formation." Syncom Indus., Inc. v. Wood, 155 N.H. 73, 82 (2007). "The terms of a contract must be definite in order to be enforceable." Id. "When there is a disputed question of fact as to the existence and terms of a contract, it is to be determined by the trier of fact." Id.

First, the Court finds that Wang's promise to provide Plaintiff two percent of the company or REDACTED the REDACTED acquisition went through is not enforceable because the REDACTED acquisition was a condition precedent that never occurred. "Where the occurrence of a condition is required by the agreement of the parties, rather than as a matter of law, a rule of strict compliance traditionally applies." Renovest Co. v. Hodges Dev. Corp., 135 N.H. 72, 78 (1991). Condition precedents are disfavored in the law but the Courts will honor them if they are included in the plain language of a parties' agreement. Greenwald v. Keating, 172 N.H. 292, 298 (2019). "As a rule of thumb, provisions which commence with words such as 'if,' 'on condition that,' 'subject to' and 'provided' create conditions precedent." Id.

Here, the parties do not dispute that Wang told Plaintiff that he would receive REDACTED or two percent of the company only if the REDACTED acquisition went through. (Doc. 62 ¶ 16.) Thus, it is clear to the Court that the plain language of the parties' agreement, especially Wang's use of the word "if, established that REDACTED acquisition of Defendant was a condition precedent. Greenwald, 172 N.H. at 298. The parties do not dispute that REDACTED never acquired Defendant. (Doc. 62 ¶ 6.) The parties dispute whether Wang revoked his offer but the Court need not reach the issue because it finds that the REDACTED promise is otherwise unenforceable. See Crowe, 174 N.H. At 682. Accordingly, because the condition precedent never occurred, Wang was not under a legal duty to give Plaintiff REDACTED See Renovest, 135 N.H. at 78-79; see also Catlaw v. Rodrigue, no. 2021-0226, 2021 WL 6333054, at *2 (N.H. Dec. 3, 2021) ("Upon the failure of the condition precedent, the defendant had no duty to perform, and the agreement was unenforceable as a matter of law.").

The Court, however, reaches a different conclusion as to Wang's alleged promise that h...