Cono Corporation v. Schils, Sheila et al

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF WISCONSIN
CONO CORPORATION,
Plaintiff-Counterdefendant, 	OPINION AND ORDER
v.
24-cv-703-wmc
DR. SHEILA SCHILS, and
EQUINEW THERAPY, LLC,
Defendants-Counterclaimants.
This case ostensibly arises out of a dispute over access to several thousand horse
treatment records, called “therapy cards,” which are owned by defendant EquiNew
Therapy, LLC (“Therapy LLC”), but really turns on a failure by the parties to work
cooperatively to develop the technology sold by defendant Dr. Sheila Schils in a stock
purchase 	agreement. 	Generally, 	plaintiff 	Cono 	Corporation 	(“Cono”) 	argues 	that
defendants Therapy LLC and Dr. Schils breached their contractual agreements by refusing
to grant it access to unredacted therapy cards, while defendants counterclaim for breach of
contract by virtue of Cono allegedly withholding promised payments and technology.
Defendants have moved for summary judgment on all of plaintiff’s claims and as to the
first of their counterclaims. 	(Dkt. #17.)1 The court agrees that: (1) defendants did not
breach any obligation to provide plaintiff with the unredacted therapy records under the
plain terms of the Service Agreement and the undisputed record on summary judgment;
1 Plaintiff also moved for leave to file a sur-reply. (Dkt. #30.) Given the breadth of the briefing
and narrowness of the sur-reply, plaintiff’s motion is granted and the court has considered the sur-
reply in deciding summary judgment.
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and (2) plaintiff breached the contract by withholding certain payments and technology
from defendants. As fully explained below, therefore, the court grants defendants’ motions
in full, although a trial is still required as to defendants’ counterclaims to determine
damages for Count I, and the merits of Counts II-III alleging breach of the Membership
Interest Purchase Agreement and entitlement to promissory estoppel.
UNDISPUTED FACTS2
A. Dr. Schils’ Background and Practice
Dr. Sheila Schils is a horse rehabilitation and treatment specialist who lives in River
Falls, Wisconsin. (Schils Decl. (dkt. #20) ¶ 1.) Dr. Schils founded and previously owned
100% of the shares in Wisconsin limited liability company, EquiNew, LLC (“EquiNew”),
before selling those shares to plaintiff Cono in June of 2024.3 	(Pl.’s Resp. to Def.’s
Proposed Findings of Fact (“PFOF”) (dkt. #24) ¶ 1.) EquiNew designs, produces, and sells
“Functional 	Electrical 	Stimulation” 	(“FES”) 	equipment, 	used 	by 	equine 	health
practitioners to rehabilitate and treat injured horses. (Id. ¶¶ 3-4.) While EquiNew trains
practitioners on how to use the FES equipment, EquiNew has never treated horses directly.
(Id. ¶¶ 4-5.)
Dr. Schils continues to own and operate a separate Wisconsin limited liability
company, defendant Therapy, LLC, through which she runs a private equine therapy
2 Unless otherwise noted, the court finds the following facts undisputed for the purposes of
summary judgment. The facts are drawn from the parties’ proposed findings of fact and responses,
as well as the underlying evidentiary record where appropriate.
3 EquiNew is not itself named as a party in suit.
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practice that treats and rehabilitates horses both in the United States and abroad. 	(Id.
¶¶ 6-7, 9.) With horse owners’ consent, Therapy LLC and Dr. Schils administer treatment,
including 	with 	FES 	technology 	developed 	and 	owned 	by 	EquiNew, 	creating 	and
maintaining predominantly handwritten treatment records throughout the process -- the
so-called “therapy cards.” 	(Id. ¶¶ 54-60.) 	These cards include confidential and sensitive
information, including the names and contact information of the horse’s owners and
trainers, as well as the horse’s specific injury and treatment history using FES technology.
(Id. ¶ 60.) 	In her private practice, Dr. Schils uses the FES technology and records data
about FES treatments on those cards. 	(See, e.g., Dkt. #23-2, at 5.) 	Over several years of
practice, Dr. Schils has generated thousands of therapy cards as she has treated horses
using FES technology. (PFOF (dkt. #24) ¶¶ 58-59.)
B. Proposed Sale of EquiNew
After spending 17 years developing FES technology for EquiNew, Dr. Schils was
considering selling the company to focus predominantly on her own, private therapy
practice. 	(Id. ¶¶ 10-11.) 	In December 2023, therefore, she contacted and hired Tony
Loiacono as a consultant to find a potential buyer for EquiNew. (Id. ¶ 12.) After Dr. Schils
rejected two other, independent offers, Loiacono himself and his business partners --
operating through plaintiff -- proposed to purchase EquiNew from Dr. Schils in April 2024.
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(Id. ¶ 28.)4 	Agreeing to their initial proposal, Cono then provided her with a Letter of
Intent of purchase. (Id. ¶¶ 28-29.) Cono is a Florida corporation, whose principal owners
are Tony Loiacono, Michael Mareschal, Ed Lorentz, and Bill McBride. 	(Loiacono Decl.
(dkt. #23) ¶ 1; PFOF (dkt. #24) ¶ 28.) During negotiations for the sale of EquiNew, Dr.
Schils disclosed to Cono that she had a separate, private horse therapy practice, Therapy
LLC, under which she intended to continue to treat horses after the sale of EquiNew.
(PFOF (dkt. #24) ¶¶ 30-31.)
Shortly after receiving Cono’s letter of intent, Dr. Schils shared a memo with
Loiacono that discussed possible improvements for future versions of the FES technology
-- titled, “FES 310 Upgrade Ideas.” (Dkt. #23-2, at 1-2.) In addition to including many
technical specifications, that memo also discussed the possibility of adding a software
feature to the next version of FES devices which could collect and store data while the
system is in use. (Id., at 4.) More specifically, the memo stated:
It would be valuable for the user to input the type of movement observed
during the treatments by being able to add words such as those listed below
[“mild, moderate, deep, etc.”]. The user could choose from the list during the
treatment by clicking on the term. The term would need to be associated
with a specific time and voltage. For example, when the time is at 10 minutes
and the voltage is 7.8 and the conductivity is 333 the practitioner would add
the term "mild". … Then all this data would … be stored under the horse's
name on the iPad. I will attach a picture of my current data storage
method so you can see what I am doing. I use an iPen and an iPad and
then this is how I also bill out for the work. Veterinarians need to have a
means to keep track of their work for billings as well so I think they would
love this option to store the data for multiple reasons.
4 The parties include certain proposed facts concerning how Loiacono transitioned from brokering
a sale of Equinew to becoming one of its buyers, including the suggestion that he disclosed certain
confidential information about the company to his business partners prematurely. 	However, no
claims have been asserted with respect to this alleged conduct, nor does it impact the court’s
decision on summary judgment.
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(Id. (emphasis added).) Attached at the end of the memo itself was the stated example of
a therapy card, which the court bolded above. 	(Id., at 5.) 	Other than this example card
referenced in the above-quoted passage, Dr. Schils’ memo does not reference incorporating
her historical therapy data in future versions of the FES technology. (Id.)
Later in April, Dr. Schils re-sent the same memo to Loiacono, adding in her cover
email that: “At the end is the document that is how I take my notes. This document should
also answer some questions you have about how the data is collected and used.” 	(Dkt.
#23-1, at 2.) Loiacono responded to that email, asking, “How many cards like this do you
have?”, to which Schils responded, “Thousands…” (Id. at 4.) 	Loiacono then forwarded
that email chain to his business partners (although not to Dr. Schils), commenting that
“this is gold.” (Id.) Even later, Loiacono noted for his business partners alone that:
The card referenced in the attachment provides Dr. Sheila Schils[’] typical
hand written Horse/Owner ID & Treatment card. This is currently being
hand done, [and EquiNew’s contracted engineer] had agreed he would
continue with this approach during early pilot. Importantly, our job will be
to make a simple web/app interface with data desired.
(Id., at 1.) 	Dr. Schils was not copied on either of the follow-up emails from Loiacono to
his business partners, nor their responses. 	(Id., at 1-4.)
C. Sale of EquiNew to Cono
On June 1, 2024, Cono formally purchased EquiNew under the terms of a written
Purchase Agreement executed by both Cono and Schils. (PFOF (dkt. #24) ¶¶ 11, 35, 37.)
The Purchase Agreement specified that, at the time of closing, Schils was to deliver an
assignment 	of 	all 	membership 	interests 	in 	EquiNew 	to 	Cono, 	a 	Non-Competition
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Agreement, and any other documents necessary to transfer all membership interests to
Cono. 	(Dkt. #6-1, at § 2.2.) 	The Purchase Agreement also specified that Cono and
Therapy LLC would execute a separate Consulting and Services Agreement (“Services
Agreement”). (Dkt. #6-1, at §§ 2.2, 5.4.) At the time of purchase, the parties also agreed
that EquiNew held no physical assets, since a contractor manufactured all the FES
equipment. (PFOF (dkt. #24) ¶¶ 32-33.) The Purchase Agreement further specified that
“it shall not be considered competition with Buyer, and/or Company for Seller, whether in
her individual capacity or as a member or employee of an entity, to . . . continue to be
engaged in the private clinical practice of animal therapy.” (Dkt. #6-1, at § 5.3.) Nor did
the Purchase Agreement reference therapy cards. 	(Id.) 	Finally, the Purchase Agreement
indicated that it superseded any prior representations with respect to Cono’s purchase of
EquiNew. (Id., at § 14.)
As specified in the Purchase Agreement, Cono also contracted Therapy LLC for
future consulting work in the Services Agreement. 	(Dkt. #6-2; PFOF (dkt. #24) ¶ 40.)
Under that agreement, Therapy LLC was to receive a Consulting Fee of $500,000.00
payable in monthly installments over sixty months, “deemed earned” at closing, along with
a defined percentage of future revenue. (Dkt. #6-2, at §§ 3.1-3.3; PFOF (dkt. #24) ¶ 40.)
Cono also agreed to provide Therapy LLC with four FES systems for use in Therapy LLC’s
private therapy practice. (Dkt. #6-2, at § 4.2; PFOF (dkt. #24) ¶ 46.) 	Dr. Schils was not
herself a named party to the Services Agreement. (Dkt. #6-2, at 1; PFOF (dkt. #24) ¶ 40.)
Like the Purchase Agreement, the Services Agreement stated that the contract represented
the parties’ final agreement, superseding any prior understandings or agreements about
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consulting services to be provided by Therapy LLC to Cono. (Dkt. #6-2, at § 18.)
More specifically, Therapy LLC agreed to provide to EquiNew: “consulting services
relating to the management and operation of the Business, consulting services related to
Functional Electrical Stimulation technology generally, and other services related to
expanding the Business into new markets on behalf of Corporation.” 	(Id., at § C.) 	The
scope of Therapy LLC’s consulting services is further defined in the agreement as follows:
Consultant shall … provide consultation to Corporation, as described in this
Section 	1, 	regarding 	the 	management 	and 	operation 	of 	the 	Business,
including marketing, customer service, customer relations, sales assistance,
analysis of accounting reports, trend data, and other significant operating
ratios, upon request and reasonable prior notice by Corporation. Consultant
shall also provide consultation to Corporation regarding the electrotherapy
industry 	in 	general 	if 	Corporation 	so 	requests. 	The 	above-referenced
consulting services (collectively, “Services”) shall include, but not be limited
to, consultation to the Business relating to parts and services, information
systems, 	risk 	management, 	financial 	services 	management, 	financial
management, and industry and client education and research.
(Id., at § 1.1.)
The Services Agreement also identified that Cono “is and will be the sole and
exclusive owner of . . . all the results and proceeds of the Services performed under this
Agreement, including any work prepared, produced, authored, edited, or modified in the
course of performing the Services (collectively, “Work Product”).” (Id., at § 5.1.) Therapy
LLC also agreed to license its pre-existing materials to EquiNew if the materials were
necessary to use any Work Product:
Notwithstanding Section 5.1, to the extent that any of Consultant’s pre-
existing materials are incorporated in or combined with any deliverable or
otherwise necessary for the use or exploitation of any Work Product,
Consultant hereby grants to Corporation . . . license to use, publish,
reproduce, perform, display, distribute, modify, prepare derivative works
based upon, make, have made, sell, offer to sell, import, and otherwise exploit
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such preexisting materials and derivative works thereof.
(Id., at § 5.5 (emphasis added).)
Separately, 	the 	Services 	Agreement 	explicitly 	acknowledged 	that 	Dr. 	Schils’
“engagement, directly or indirectly, in the private clinical practice in animal therapy does
not compete with Corporation’s Business.” 	(Id., at § 10; PFOF (dkt. #24) ¶ 45.) 	The
parties further agreed that both the Purchase Agreement and the Service Agreement “reflect
the parties’ mutual understanding that Dr. Schils would continue to provide treatment
services to horses post-closing through Therapy LLC.” (PFOF (dkt. #24) ¶ 43.)
D. The Parties’ Dispute over the Therapy Cards and FES equipment
Since the parties entered the agreement, Dr. Schils has continued to treat horses
under her Therapy LLC practice and to create and maintain therapy cards while directly
treating horses. (Dkt. #28, ¶ 78.) Immediately pre- and post-closing, the record also shows
that the parties met and discussed planned improvements to the FES systems, based
predominantly on Dr. Schils’ previously provided memo for contemporaneous data
collection. (Dkt. #23-3, at 2-6). Like the memo itself, those meeting notes show that the
parties discussed technical specifications for a data capture feature on a future version of
the FES device. (Id.)
Shortly 	after 	these 	discussions, 	however, 	the 	parties’ 	relationship 	began 	to
deteriorate, including disputes over pre-closing sales revenue, the transfer of EquiNew’s
bank accounts, and the status of the therapy cards. (PFOF (dkt. #24) ¶¶ 48-52.) Relevant
to the therapy card dispute in particular, at some point either before or after the
acquisition, described as “mid-2024” by Loiacono, Cono Corporation generated an
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undated, internal presentation showing the planned use of therapy cards to develop an app
in conjunction with a developer called NewCo. (Loiacono Decl. (dkt. #23) ¶ 7; Dkt. #23-
2, at 6.) The presentation itself states that: “Note: Developed w/ Dr. Schils[’] knowledge
since April 2024 with comprehensive writ[ten], zoom and verbal communication by
NEWCO.” 	(Dkt. #23-2, at 6.) 	Cono does not provide any record evidence that this
presentation specifically was sent to Dr. Schils or otherwise shared with her. (Dkt. #23-2,
at 6-7.) Nonetheless, Loiacono testified that: “Dr. Schils was aware of and involved in …
discussions [to use the therapy card data to develop an app] – indeed, the plan was
predicated on incorporating her experience and data.” (Loiacono Decl. (dkt. #23) ¶ 7.)
On the other hand, Dr. Schils maintains that, from the beginning of negotiations
for the purchase of EquiNew until late August, 2024, she was unaware that Cono planned
to either purchase or use therapy card data. (Schils Decl. (dkt. #29) ¶¶ 5-7.) Specifically,
she testifies that Cono first asserted any expectation for her to transfer all her therapy cards
to it during an August 2024 Zoom meeting, at least two months after closing. (Schils Decl.
(dkt. #20) ¶ 28.) 	In this meeting, Ed Lorentz, one of Cono’s owners, told Dr. Schils on
behalf of Cono that they would accept the therapy cards with the confidential information
identifying the horse and the owner redacted. (Dkt. #29-2, at 4; PFOF (dkt. #24) ¶¶ 64-
65.) 	Later, Cono changed course, however, stating it would only accept fully unredacted
therapy cards, because Cono wanted the data to include a Horse ID so that they could
track any given horse’s improvement over time. 	(PFOF (dkt. #24) ¶ 66; Loiacono Decl.
(dkt. #23) ¶ 12.) Given the sensitive nature of the information on the therapy cards, Dr.
Schils refused to provide them unredacted. (PFOF (dkt. #24) ¶ 62.)
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Up until this point, Therapy LLC had billed 281 hours of consulting services to
Cono. 	(Dkt. #28, ¶78.) 	However, when Dr. Schils refused to send unredacted therapy
cards, 	Cono 	ceased 	paying 	Therapy 	LLC 	under 	the 	Services 	Agreement, 	and 	she
subsequently ceased consulting for them. 	(Loiacono Decl. (dkt. #23) ¶ 14.) 	As a result,
Cono has not paid Therapy LLC the monthly portion of its consulting fee after October
2024, nor the post-closing prorated Revenue Share for the year 2024, which the parties
agree was $14,583.33. (Id.; PFOF (dkt. #24) ¶ 92.)
For the services that she did provide as a consultant under Therapy LLC, Dr. Schils
reports she did not directly treat horses, nor did she create any materials for which the
therapy cards would be necessary to use. (Schils Decl. (dkt. #20) ¶¶ 37-40.) For his part,
Loiacono testified that: “The Therapy Cards data are, in fact, necessary to exploit the ‘trend
data’ analysis and expansion initiatives that were a core part of Dr. Schils’ consulting
duties. It was understood on both sides that Cono would need access to those historical
therapy records to perform meaningful trend analysis and drive EquiNew’s growth.”
(Loiacono Decl. (dkt. #23) ¶ 8.)
Finally, Cono and EquiNew have not provided Therapy LLC with the four FES units
specified in the Services Agreement. 	(Dkt. #28, ¶ 78.) 	Cono represents that it did not
provide the units because about 17 FES systems were present at the manufacturer, and
that Cono requested a reconciliation of FES inventory from Dr. Schils in a demand letter
before release. (Loiacono Decl. (dkt. #23) ¶ 14.) However, Dr. Schils responds that Cono
retains complete control over the FES equipment inventory records, and she does not have
access to the FES equipment inventory records; meaning she is unsure as to the reason for
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any confusion and cannot provide assistance outside offering to contact the manufacturer.
(Schils Decl. (dkt. #29) ¶ 14.)
OPINION
The court grants summary judgment when the moving party demonstrates that
“there is no genuine dispute as to any material fact and the movant is entitled to judgment
as a matter of law.” Fed. R. Civ. P. 56(a). The moving party bears the initial responsibility
of showing the court that there is no genuine issue of material fact demonstrated by the
non-moving party on the record. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the
moving party meets this burden, the nonmoving party must point to “specific facts showing
a genuine issue for trial.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574,
587 (1986). “A mere scintilla of evidence in support of the nonmoving party's position is
insufficient to defeat a motion for summary judgment; there must be evidence from which
a jury could reasonably find for the non-moving party.” Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 252 (1986).
In considering a motion for summary judgment, the court must draw all inferences
from the record in the light most favorable to the nonmoving party. Matsushita, 475 U.S.
at 587. If the moving party shows that, on the essential elements of its case, no reasonable
jury could find for the nonmoving party, then it is entitled to summary judgment as a
matter of law. 	Trade Fin. Partners, LLC v. AAR Corp., 573 F.3d 401, 406-07 (7th Cir.
2009).
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I. 	Therapy LLC’s Alleged Obligation to Provide the Therapy Cards under the
Services Agreement (Count II)
As specified in the Services Agreement, disputes under the contracts at issue are
governed by Florida law. 	(Dkt. #6-2, § 19.) 	In Florida, “contract interpretation is a
question of law to be decided by the court by reading the words of a contract in the context
of the entire contract and construing the contract to effectuate the parties’ intent.” Feaz v.
Wells Fargo Bank, N.A., 745 F.2d 1098, 1104 (11th Cir. 2014). Where the parties’ dispute
their intent at the time they entered into the contract, “the plain language of the contract
is the best evidence of the parties’ intention.” 	Golden v. Univ. of Miami, 484 F. Supp. 3d
1255, 1262 (S.D. Fla. 2020) (quoting Handi-Van, Inc. v. Broward Cty., Fla., 2010 WL
1223776, at *5 (S.D. Fla. Mar. 29, 2010)).
Whether contractual language is ambiguous is a question of law. 	Id. 	Ambiguity
exists only where the contract language is susceptible to two different, reasonable
interpretations. Seritage SRC Fin., LLC v. Town Ctr. at Boca Raton Tr., 397 So. 3d 44, 46–
47 (Fla. Dist. Ct. App. 2024). A particular contract interpretation “is not reasonable if it
requires rewriting the contract to add language that a party omitted and in order to impose
an obligation on the other party that was not in the original bargain.” Golden, 484 F. Supp.
3d at 1262 (quoting Ferreira v. Home Depot/Sedgwick CMS, 12 So. 3d 866, 868 (Fla. 1st
DCA 2009)). As such, “where a contract is silent as to a particular matter, courts should
not, under the guise of construction, impose on parties contractual rights and duties which
they themselves omitted.” Id. (quoting BMW of N. Am., Inc. v. Krathen, 471 So. 2d 585,
587 (Fla. 4th DCA 1985)). 	The parties are bound by the unambiguous terms of their
contract. 	Chrysler Realty Corp. v. Davis, 877 So. 2d 903, 906 (Fla. Dist. Ct. App. 2004).
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Thus, unless the contract is ambiguous, extrinsic evidence of the parties' subjective
understanding is not consulted. Feaz, 745 F.3d at 1104.
In this case, the parties ask the court to determine whether the Services Agreement
obligated Therapy LLC to give its therapy card data to plaintiff. 	The only provisions of
that agreement under which plaintiff could plausibly expect Therapy LLC to transfer or
license its therapy cards are: 	(1) Section 5.1, which states that Cono owns all Work
Product created pursuant to Therapy LLC’s services under the agreement; or (2) Section
5.5, which requires Therapy LLC to license any pre-existing materials necessary to use any
Work Product generated under the agreement. The court addresses each clause in turn to
determine whether the agreement obligated Therapy LLC to transfer the cards or all
information on the cards to plaintiff as a matter of law given the undisputed facts.
A. Section 5.1
Section 5.1 of the Agreement states that Cono “is and will be the sole and exclusive
owner of . . . all the results and proceeds of the Services performed under this Agreement,
including any work prepared, produced, authored, edited, or modified in the course of
performing the Services (collectively, “Work Product”).” 	(Dkt. #6-2, at § 5.1.) 	The
Services are fully described in Section 1.1 and include: “consultation to the Business
relating to parts and services, information systems, risk management, financial services
management, financial management, and industry and client education and research.” (Id.,
at § 1.1.)
Defendants argue that no evidence in the record supports a finding that Dr. Schils
created therapy cards as part of these defined Services because: (1) Cono admits that the
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entire process through which therapy cards are created is under the auspices of Therapy
LLC’s private therapy practice, during which Dr. Schils directly treats horses; (2) the
Services that Therapy LLC was to provide under the Services Agreement does not include
directly treating horses; (3) Cono admits that it never asked Dr. Schils to treat horses under
the Services Agreement, nor does EquiNew treat horses as part of its business; and (4) the
agreement expressly contemplates in the non-competition provision that Dr. Schils will
continue privately treating horses, separately from her provision of Services to Cono.
In response, plaintiff does not actually address how, if at all, Section 5.1 entitles it
to historical information in the therapy cards, but rather just cites that section several times
in its brief, asserting without explaining why its language in any way obligates Therapy
LLC to transfer the cards under this provision. 	Such an undeveloped argument is no
argument at all, and plaintiff has effectively waived it at least as to this provision. 	See
Savory v. Cannon, 2024 WL 4786167, at *9 (C.D. Ill. 2024) (citing Laborers Int'l Union v.
Caruso, 197 F.3d 1195, 1197 (7th Cir. 2003)) (“A party opposing summary judgment
waives any argument not raised in his responding brief.”).
Even if plaintiff had not waived this argument, the undisputed facts in the record
demonstrate that defendants are entitled to summary judgment as a matter of law, since
Section 5.1 is unambiguous: 	Cono owns any Work Product generated by Therapy LLC
pursuant to the Services that Therapy LLC was to provide under the Agreement only.
Directly treating horses, and thus producing the therapy cards for individual horses, is not
part of the definition of Services in the Agreement. Instead, it was expressly contemplated
by the Services Agreement to be a separate practice that Therapy LLC was to maintain.
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Moreover, even the contemporaneous creation of those records while using the technology
itself was only a theoretical possibility at the time of EquiNew’s purchase by plaintiff.
Construing the pleadings and record most generously to the nonmoving party,
plaintiff haphazardly argues that the analysis of “trend data” as part of Dr. Shils’ work
under the Services Agreement would have required Therapy LLC to produce therapy cards
for analysis by Cono and ensure that they were then transferred to Cono as ‘Work Product’
under section 5.1. However, reading the whole definition of “Services” to be provided, the
work of Therapy LLC, including Dr. Shils’ work, is defined as: “consultation … regarding
the management and operation of the Business, including marketing, customer service,
customer relations, sales assistance, analysis of accounting reports, trend data, [etc.],” but
does not include direct treatment of horses. 	(Dkt. #6-2, at § 1.1.); Golden, 484 F. Supp.
3d at 1255 (“Contract interpretation is a question of law to be decided by the court by
reading the words of a contract in the context of the entire contract.”) (emphasis added).
Thus, interpreting individualized historic horse therapy cards as Work Product
generated by the business-oriented consulting that Services Therapy LLC was to provide
under the agreement is not a reasonable interpretation of the contract language, particularly
in light of: (1) the clauses in the agreement contemplating Dr. Schils’ continued, separate
private practice treating horses; (2) the fact that EquiNew has not and does not provide
direct treatment services to horses; and (3) Cono’s admissions that the therapy cards are
created in the process of directly treating horses. 	Ferreira, 12 So. 3d at 868 (“An
interpretation is not reasonable if it requires rewriting the contract to add language that a
party omitted … in order to impose an obligation on the other party that was not in the
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original bargain”). 	Thus, the parties are bound by the unambiguous contract language,
and any therapy cards generated by Therapy LLC after it entered into the Services
Agreement with Cono cannot be considered Work Product under Section 5.1 as written,
unless following under the exception in Section 5.5. Chrysler, 877 So. 2d at 906.
Finally, and perhaps most importantly, plaintiff has failed to show any material
breach under the Services Agreement by defendants under Section 5.1, since it is
undisputed that they offered to provide the therapy cards redacted only to preserve the
confidentiality of the individual horse and its owner. 	As there is no genuine dispute of
material fact in the record on this point, defendants are entitled to summary judgment as
a matter of law.
B. Section 5.5
Defendants similarly argue that they are entitled to summary judgment as a matter
of law that Section 5.5 of the Services Agreement did not require Therapy LLC to license
its therapy card data to plaintiff. Instead, Section 5.5 merely provides: “to the extent that
any of Consultant’s pre-existing materials are incorporated in or combined with any
deliverable or otherwise necessary for the use or exploitation of any Work Product,
Consultant hereby grants to Corporation” a license to use the pre-existing materials. (Dkt.
#6-2, at at § 5.1.) 	Defendants first argue that plaintiff waived any claim of breach of
Section 5.5 by failing to even allege such a breach in its complaint. 	Defendants further
argue that plaintiff fails to identify any deliverable or Work Product that Therapy LLC
generated while providing work under the Services Agreement in which therapy data was
incorporated or for which the therapy data is necessary to use. Thus, they argue, there is
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no genuine dispute of material fact that under the Agreement, Therapy LLC was not
obligated to license its therapy card data to plaintiff.
Plaintiff responds that it properly claimed in its complaint that Therapy LLC
breached Section 5.5. 	Assuming that the allegation was properly raised, plaintiff’s
argument that it is entitled to the therapy cards under Section 5.5 of the agreement
nonetheless fails as a matter of law. To begin, plaintiff argues that the therapy cards were
necessary for the use or exploitation of Dr. Schils’ “trend analysis” to be performed as part
of her consulting under the Services Agreement. 	In support of this assertion, plaintiff
points to the memo that Dr. Schils emailed to Cono in April 2024, discussing the
possibility of a next version of FES technology, as well as Cono’s subsequent emails about
that memo. Even if the memo and Dr. Schils’ emails explicitly referenced a plan to use all
of Therapy LLC’s therapy card data to develop future versions of the FES technology --
and, on their face, they do not -- none of these materials could possibly be considered Work
Product generated by Therapy LLC under the Services Agreement, because they were all
generated before the parties entered into that agreement on June 1, 2024.
Additionally, plaintiff relies on notes of discussions that occurred just before and
after closing allegedly showing that Cono is entitled to the therapy cards under Section
5.5. Like the memo and Dr. Schils’ emails, however, the discussion notes did not reference
a plan to use Therapy LLC’s therapy card data to develop future versions of the FES
technology. 	And to the extent that the notes could be considered ongoing Work Product
generated as a result of Therapy LLC’s performance under the agreement, plaintiff makes
no showing that several years’ worth of therapy card data is incorporated into the notes,
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or necessary to exploit or use the meeting notes themselves. Thus, again, plaintiff proffered
no material fact that Section 5.5 allows plaintiff to demand the therapy cards based on the
meeting notes alone.
Finally, plaintiff argues that its undated internal presentation, which discusses plans
to develop an app that incorporated therapy card data, required Therapy LLC to license
the therapy cards to plaintiff under Section 5.5. 	First, the presentation was plaintiff’s
internal strategic planning document that Loiacono helped prepare. (Loiacono Decl. (dkt.
#23) ¶¶ 2(b), 7.) 	Thus, even if Dr. Schils knew about this presentation and the plan
(which she disputes), and the presentation was generated after the parties entered into the
Services Agreement (which is not apparent from the record), the presentation itself is not
Therapy LLC’s Work Product; Therapy LLC did not produce it while performing Services
under the Agreement. Rather, it is plaintiff’s own, internal plan. Therefore, the document
cannot form the basis to require Therapy LLC to license its therapy cards to plaintiff under
Section 5.5. 	Finally, even if the document could be considered Therapy LLC’s Work
Product, plaintiff makes no showing that Therapy LLC’s entire cache of treatment records
is incorporated in, or necessary to use, the planning document itself.
In summary, whether it was truly plaintiff’s unilateral understanding that it would
be entitled to use all of Therapy LLC’s unredacted therapy cards, and whether Dr. Schils
knew of this, there is no dispute of material fact as to this claim because plaintiff fails to
identify any “Work Product” generated by Therapy LLC under the Services Agreement
that would require Therapy LLC to license its therapy cards to plaintiff at all, much less in
their fully unredacted form, under Section 5.5 of the contract. At most, the plain language
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of the Services Agreement shows the parties’ intentions when they entered the contract,
and the court may not “rewrite contracts, add meaning that is not present, or otherwise
reach results contrary to the intentions of the parties” when it is asked to interpret the
contract. Deni Assocs. of Fla., Inc. v. State Farm Fire & Cas. Ins. Co., 711 So. 2d 1135, 1138
(Fla. 1998). 	Again, most importantly, the undisputed evidence is that defendants went
above and beyond the Services Agreement’s express terms by offering access to redacted
versions of its private therapy cards in good faith, which plaintiff declined. 	Thus, there
was no breach of contract by defendants, and they are entitled to summary judgment as a
matter of law on this claim.
To be clear, this does not mean that defendants may not still have an obligation to
incorporate pre-existing therapy card information as “necessary for the use or exploitation
of” any app or treatment protocols that might be developed under the Service Agreement
in the future, and if so, perhaps even to license their use. 	However, plaintiff has offered
no facts permitting an inference that defendants were even asked to develop such a product
under the Services Agreement, much less that they did so. 	To the contrary, plaintiff
concedes that it merely directed defendants to turn over the raw data for a different, third
party to use as it saw fit to develop those products, rather than asking defendants to do so.
II. Plaintiff’s Remaining Claims (Counts I, III-V)
Defendants have also moved for summary judgment on plaintiff’s remaining claims,
which the court briefly addresses below, finding for defendants on each count as a matter
of law.
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A. Dr. Schil’s Alleged Obligation to Provide the Therapy Cards under the
Purchase Agreement (Count I)
In Count I, plaintiff argues that, under the Purchase Agreement, Dr. Schils was
individually liable for failure to ensure that Therapy LLC effectuated the Services
Agreement. Regardless of the merits of this proposition, because the court finds that
Therapy LLC did not have a contractual obligation to transfer unredacted and unfettered
pre-existing therapy cards to Cono under the terms of the Services Agreement, defendants
are entitled to summary judgment as a matter of law on this claim.
B. Unjust Enrichment (Count IV)
Plaintiff claims that it is alternatively entitled to relief under an unjust enrichment
theory, because “defendants have been unjustly enriched by receiving the benefits of the
Purchase Agreement and the Services Agreement without performing their corresponding
obligations, including transferring the Cards and other intellectual property to the
Company.” 	(Pl.’s Compl. (dkt. #6) ¶¶ 32-34.) 	Plaintiff explains in its briefing that the
benefits it alleges that Therapy LLC is unjustly retaining are the payments under the
Services Agreement and its therapy cards. 	Plaintiff also argues that the claim should
survive summary judgment as an alternative claim for relief should the court find the
Services Agreement void or unenforceable.
However, as defendants note, under Florida law, “when there is a valid contract
governing the dispute, a plaintiff cannot recover under a contract implied by law—instead,
the express contract governs.” AECOM Tech. Servs., Inc. v. Pro. Servs. Indus., Inc., 580 F.
Supp. 3d 1176, 1194 (M.D. Fla. 2021) (citing Agritrade, LP v. Quercia, 253 So. 3d 28, 34
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(Fla. 3d DCA 2017)). Here, neither party has argued that the Services Agreement is void
or unenforceable. 	Instead, a valid, express contract squarely governs the circumstances
under which plaintiff owns material produced by Therapy LLC, or the circumstances in
which Therapy LLC must license its pre-existing materials to plaintiff. Therefore, plaintiff
cannot recover under an implied contract theory as a matter of law, and defendants are
entitled to summary judgment on plaintiff’s unjust enrichment claim as well. Id.
C. Claims for Specific Performance and Injunctive Relief (Counts III, V)
Finally, specific performance and injunctive relief are available as remedies to breach
of contract. 	However, because the court finds that neither Dr. Schils nor Therapy LLC
breached their contracts with plaintiff, specific performance and injunctive relief are not
available here, at least under the current record before the court. Thus, defendants are also
entitled to summary judgment as to these claims.
III. Therapy LLC and Dr. Schils’ Counterclaim against Cono for Breach of
Contract (Count I)
Defendants also move for summary judgment as to Count I of their counterclaims
for breach of the Services Agreement based on plaintiff’s failure to: (1) pay the Consulting
Fee due under Section 3.2; (2) pay the Revenue Share required under Section 3.3; and (3)
provide four FES systems under Section 4.2. The court addresses each of these subclaims
in turn below.
A. Consulting Fees
Defendants argue that plaintiff materially breached the Services Agreement in
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November 2024 by ceasing payment of the monthly consulting fee as called for under the
Agreement. 	Under Florida law, if a party substantially performs under the contract, it is
not in material breach and may recover the benefit of its bargain. Hibachi Grill, Inc. v. Arki
Const., Inc., 138 So. 3d 576, 578 (Fla. 3d DCA 2014). Similarly, if a party fails to pay its
obligations under a contract despite the other party substantially performing, that party
has materially breached the contract. Star2Star Commun., LLC v. AMG Group of Brunswick,
LLC, 2021 WL 4442668, at *3 (M.D. Fla. 2021), aff'd, 2022 WL 1157776 (11th Cir.
2022).
Here, plaintiff admits that it stopped paying the Consulting Fee to Therapy LLC
starting in November 2024, despite it providing consulting services to plaintiff until then.
Worse, the parties agree that the total, initial consulting fee of $500,000 was “deemed
earned” under the Services Agreement at the time of closing, payable to Therapy LLC, even
in the event of Dr. Schils’ death or incapacitation. (Dkt. #6-2, at § 3.2.) Thus, defendants
contend that plaintiff materially breached their Agreement.
In response, plaintiff argues that its admitted nonperformance was excused because
of defendants’ material breach of the Services Agreement by refusing to transfer unredacted
therapy cards. 	The court has already concluded that defendants had no such obligation,
however, 	and 	plaintiff 	offers 	no 	additional 	factual 	or 	legal 	basis 	justifying 	its
nonperformance. Moreover, since this was plaintiff’s sole argument for its nonperformance,
the court could simply grant summary judgment to defendants on that basis alone. 	See
Caruso, 197 F.3d at 1197 (7th Cir. 2003) (a party opposing summary judgment waives any
argument not raised in its response brief); Milligan v. Bd. of Trs. of S. Ill. Univ., 686 F.3d
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378, 389 (7th Cir. 2012) (a party opposing summary judgment forfeits reliance on
evidence not cited in its response).
Even considering the entirety of the record, which the court is not obligated to do,
plaintiff’s other suggested reasons for stopping consulting payments are inadequate. First,
plaintiff argues Dr. Schils was obligated to demonstrate that her recorded consulting hours
rendered a measurable benefit to Cono, but no such obligation is spelled out in the
Agreement, nor could a jury find defendants were acting without good faith on this record.
Second, plaintiff suggests Dr. Schils wrongfully retained access to an EquiNew email
address and bank account, which constituted a separate, material breach justifying its
nonpayment. 	However, the only evidence to this effect lies in conclusory statements in
Loiacono’s declaration, which is nothing more than a “mere scintilla” of evidence
insufficient by itself to permit a reasonable jury to find that Therapy LLC materially
breached the agreement or failed to substantially perform in good faith, such that plaintiff’s
nonpayment of the consulting fee was justified. 	Anderson, 477 U.S. at 252. 	And again,
even if such a defense were arguable, plaintiff admits that $500,000 in consulting fees were
already “deemed earned” at closing, making any claimed after-the-fact excuse for non-
payment for Therapy LLC’s services immaterial up to that amount. 	As such, the court
finds that there is no genuine dispute of material fact that plaintiff did not timely pay
Therapy LLC the consulting fee due and owing under the Services Agreement, and such
nonpayment constitutes a material breach of contract as a matter of law. Thus, defendants
are entitled to summary judgment on this counterclaim for the monthly payments due to
date.
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B. Revenue Share
Defendants similarly argue that there is no genuine dispute of material fact that
plaintiff failed to pay the Revenue Share for 2024 called for under the Services Agreement,
which would also amount to a breach of contract. 	It is undisputed that plaintiff did not
pay Therapy LLC the 2024 Revenue Share, and plaintiff’s only possible justification for
such nonpayment on the record is that defendants first materially breached the contract
by refusing to transfer the unredacted therapy cards. 	Because defendants did not
materially breach the Services Agreement by refusing to transfer the therapy cards,
plaintiff’s nonpayment of the revenue share is a material breach of contract as a matter of
law. 	Star2Star, 2021 WL at *3. 	Defendants are entitled to summary judgment on this
aspect of their counterclaim as well in the amount of $14,583.33, which the parties agree
is the prorated Revenue Share amount under the Agreement for 2024.
C. FES Systems
Last, defendants claim plaintiff breached the Services Agreement by failing to
provide the four FES systems due under the plain terms of Section 4.2 of the Servies
Agreement, despite defendants having requested those systems but never receiving them.
Again, plaintiff’s only excuse for nonperformance is Therapy LLC’s refusal to relinquish
unredacted therapy cards, which is insufficient to support a breach. Since plaintiff makes
no other argument to justify its nonperformance under the Agreement, the court may stop
there and grant summary judgment to defendants on this claim. Caruso, 197 F.3d at 1197;
Milligan, 686 F.3d at 389.
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Nonetheless, plaintiff states elsewhere that it did not provide the FES systems to
defendants because the manufacturer retained about 17 FES units, and plaintiff had
requested from Dr. Schils a reconciliation as to the number of units in inventory shortly
before filing this lawsuit. 	(Loiacono Decl. (dkt. #23) ¶ 14; Dkt. #23-5.) 	Defendants
respond that plaintiff retains complete control over EquiNew’s inventory, and that Dr.
Schils has no access to the inventory records of the FES systems after the sale. 	Plaintiff
neither offers facts in the record rebutting this assertion, at least after the sale of EquiNew,
nor does it explain how a discrepancy in the number of units held by the manufacturer
would entitle it to withhold the four units due Therapy LLC under the unambiguous
Agreement. Thus, there is no genuine dispute of material fact that plaintiff breached the
agreement by failing to provide these units. Defendants are entitled to summary judgment
as a matter of law on this counterclaim, with the damages on this aspect of the breach to
be determined at trial, and they are entitled to summary judgment on the entirety of the
breach of contract claim in Count I of their counterclaims.
ORDER
IT IS ORDERED that:
1) Plaintiff’s motion for leave to file sur-reply (dkt. #30) is GRANTED.
2) Defendants’ motion for summary judgment (dkt. #17) on plaintiff’s claims of
breach of contract (Counts I-V) is GRANTED.
3) Defendants-counterclaimants’ motion for partial summary judgment (dkt. #17)
on its claims of breach of contract (Count I) is GRANTED.
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4) This case shall proceed to trial solely on the question of damages for Count I of
defendants-counterclaimants’ counterclaims, and the merits of defendants-
counterclaimants’ remaining counterclaims.
Entered this 6th day of January, 2026.
BY THE COURT:
/s/
__________________________________
WILLIAM M. CONLEY
District Judge
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