United States District Court, D. Utah
ORDER GRANTING IN PART PLAINTIFF'S MOTION FOR
N. Parrish, United States District Court Judge.
the court is Plaintiff's Motion for Partial Summary
Judgment (ECF No. 34), filed on September 15, 2017. The court
heard oral argument on December 7, 2017. Having considered
the parties' briefs, the arguments of counsel, and the
relevant law, the court hereby grants Plaintiff's motion
in part and denies it in part.
Recycling is a Haitian corporation managed by Cyrille Turnier
and Peter de Gier. In the summer of 2014, Global contacted
Michael Williams, the sole member of Montclair Technology (a
Utah LLC). Global expressed a desire desire to build a motor
oil refinery in Haiti. On July 11, 2014, the parties entered
into a Non-Circumvention, Non-Disclosure and Working
Agreement pertaining to the venture. And on August 31, 2014,
the parties entered into a Purchase Order Agreement (the
Agreement lies at the heart of this action. It is a sparse,
four-page document under which Montclair agreed to
“build and deliver to Global Recycling SA at its
Spanish Fork, Utah, USA facility, a working R&D prototype
of a continuous batch operating test unit capable of
processing a minimum of 15 gallons of a finished diesel
product per hour, converted from Used Lubricating Oil (Test
Unit).” Agreement ¶ 1. The Test Unit would be
“a turnkey project, consisting of equipment to operate
the unit in a continuous mode of operation.”
Id. ¶ 4B.
Agreement describes the process by which the Test Unit will
accomplish its design: “The process uses elements of
sub and supercritical pressures through a high pressure
reactor followed by vacuum distillation. This process is
known as ‘Hydrothermal Upgrading' using proprietary
know how [sic], equipment, and methods developed by Montclair
and is confidential and personal to Global Recycling
SA.” Id. ¶ 2. The same paragraph
indicates that “[t]he Test Unit process and operating
parameters used in the Test Unit will be demonstrated upon
the delivery and demonstration of Test Unit as set forth in
paragraph 4 hereof.” Id.
the Agreement, the parties agreed to a purchase price of
“$60, 000 U.S. dollars for a completely mechanically
skidded fully operational Test Unit.” Id.
¶ 3. That price was to be paid in three installments:
$30, 000 on or before September 1, 2014; $25, 000 on or
before September 10, 2014; and $5, 000 payable “upon
delivery, inspection, acceptance and B/L of shipment to Haiti
by Global Recycling SA of the Test Unit at Montclair's
Spanish Fork, Utah facility.” Id. Notably,
Montclair guaranteed the price and operation of the Test
Unit. Id. ¶ 4A. And Williams personally
guaranteed the final construction costs of the Test Unit,
promising that if the Test Unit cost more than $60, 000, he
would “as an individual, apart from his ownership in
Montclair Technology LLC, . . . make up the difference to
insure Global will take ownership of the finished unit free
and clear of any financial encumbrances.” Id.
Montclair produced the Test Unit, it was required to
“notify Global Recycling SA that it can come to
Montclair's facility to see a demonstration of the Test
Unit operation and process.” Id. ¶ 4. The
paragraph continues: “In connection with the Test Unit
operation, Montclair will deliver written information and
process descriptions of the Unit operation, controls,
temperatures, and chemicals needed for Global Recycling SA to
operate the Test Unit in Haiti.” Id.
the Agreement specifies dates for payment, it does not set a
hard-and-fast deadline by which Montclair was to deliver the
Test Unit. The only indication regarding timing is
Montclair's commitment to “use its best efforts to
complete the test unit within 45 days of receipt of the
partial purchase price set forth in paragraph 3
hereof.” Id. ¶ 4. Forty-five days after
the second installment of the purchase price was October 18,
the Agreement addresses the issue of ownership: “The
unit is paid for by Global Recycling SA and upon final
payment shall be the sole property of Global Recycling SA.
Montclair will not use the unit for its own purposes or to
demonstrate its processes using the Global test unit to
unaffiliated parties.” Id. ¶ 6.
date, Global has paid Montclair $87, 600. But Global has not
received the Test Unit from Montclair.
October 6, 2016, Plaintiff filed a complaint against
Defendants. The complaint alleges six claims for relief: (1)
breach of contract, (2) breach of express warranty, (3)
violation of the Defend Trade Secrets Act, (4)
misappropriation of trade secrets under the Utah Uniform
Trade Secrets Act, (5) fraudulent inducement, and (6)
November 10, 2016, Defendants had not answered
Plaintiff's complaint. The court ordered Defendants to
answer the complaint by November 29, 2016 and to inform the
court regarding the status of the case and their intentions
to proceed. See ECF No. 7. Defendants answered the
complaint on November 29, 2016 and brought two counterclaims
against Global for declaratory judgment and breach of
has moved for summary judgment on three of its claims: breach
of contract, breach of express warranty, and declaratory
Rule of Civil Procedure 56(a) provides that “[t]he
court shall grant summary judgment if 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.” In
applying this standard, courts must “construe the
evidence and the reasonable inferences drawn therefrom in the
light most favorable to the nonmovant.” Sally
Beauty Co. v. Beautyco, Inc., 304 F.3d 964, 972 (10th
Cir. 2002). However, the nonmovant “is entitled to only
those inferences that are ‘reasonable.'”
Hornady Mfg. Co. v. Doubletap, Inc., 746 F.3d 995,
1004 (10th Cir. 2014) (quoting Water Pik, Inc. v.
Med-Systems, Inc., 726 F.3d 1136, 1143 (10th Cir.
2013)). “[S]ummary judgment cannot rest on purely
conclusory statements either in pleading or affidavit
form.” Morgan v. Willingham, 424 F.2d 200, 201
(10th Cir. 1970).
interpretation of a contract is a legal question. Mind
& Motion Utah Invs., LLC v. Celtic Bank Corp., 367
P.3d 994, 999 (Utah 2016). This court's task in
interpreting a contract “is to ascertain the
parties' intent.” Id. at 1001. “And
the best indication of the parties' intent is the
ordinary meaning of the contract's terms.”
Id. Therefore, the court first looks to the language
of the contract, which it reads as a whole in order to
construe various clauses consistently. See Utah Const.
& Dev. Co. v. Reynolds Elec. & Eng'g Co.,
951 F.2d 1261, at *2 (10th Cir. 1991) (table opinion).
“[I]f the language within the four corners of the
contract is unambiguous, the parties' intentions are
determined from the plain meaning of the contractual
language, and the contract may be interpreted as a matter of
law.” Mind & Motion, 367 P.3d at 1001
(citation omitted). On the other hand, “[a] contract is
facially ambiguous if its terms are capable of more than one
reasonable interpretation because of uncertain meanings of
terms, missing terms, or other facial deficiencies.”
Id. (citation omitted). When the parties'
intentions are not apparent from the face of the contract,
the court must also consider extrinsic evidence. Id.