Electro-Mechanical Products, Inc. et al v. Alan Lupton Associates Inc.

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Chief Judge Philip A. Brimmer
Civil Action No. 22-cv-00763-PAB-SBP
ELECTRO-MECHANICAL PRODUCTS, INC., a Colorado Corporation,
Plaintiff,
v.
ALAN LUPTON ASSOCIATES INC., a New York Corporation,
Defendant.
ORDER
This matter comes before the Court on Defendant’s Motion for Summary
Judgment [Docket No. 62]. The Court has jurisdiction pursuant to 28 U.S.C. § 1332.
I. BACKGROUND
This case arises out of the business relationship between plaintiff Electro-
Mechanical Products, Inc. (“EMP”) and defendant Alan Lupton Associates Inc. (“ALA”).
Docket No. 84 at 3, ¶ 10. EMP brings two causes of action against ALA: breach of
contract and unjust enrichment. Id. at 6-7, ¶¶ 24-32; Docket No. 62 at 6, ¶ 29. ALA
seeks summary judgment in its favor on both claims. Docket No. 62 at 2.
II. FACTS1
The contract between the parties dated November 1, 1989 (“Contract”) contains
two clauses relevant to this action—the best efforts clause and the noncompete
clause—which are contained in the same paragraph:
1 The following facts are undisputed unless otherwise noted.
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 1 of 15

2
. . . [ALA] to use its best efforts to promote, develop and extend the sales
of [EMP’s] services and products during the contract term or any
extension, and in furtherance thereof, shall not directly or indirectly solicit
orders for or sell any products competitive with [EMP’s] products without
its written consent.
Id. at 3, ¶¶ 4-5. The best efforts clause contains no objective criteria or guidelines to
assess ALA’s best efforts. Id., ¶ 6. The noncompete clause was amended in 2000 to
define “competitive” as “the products of a general-purpose machining job shop.”2 Id.,
¶ 7.
Beginning in 2021, EMP unilaterally created a “scorecard” to measure ALA’s
performance.3 Id. at 4, ¶ 13. EMP terminated the contract with ALA, in part, because
ALA did not use best efforts, as measured by scorecards. Id. at 5, ¶ 20.
EMP alleges that ALA breached the noncompete clause by soliciting or selling
the products of its competitors. Id., ¶ 21. EMP alleges that ALA sold products of PGM
Corp. (“PGM”) to Viasat, Inc. (“Viasat”). Id. EMP has maintained that PGM is a
competitor since, at least, March 23, 2022. Id., ¶ 22. EMP alleges that ALA sold
2 EMP denies this fact on the basis that the “definition of ‘competitive’ has
changed due to the parties’ course of dealing.” Docket No. 76 at 4, ¶ 7. However, the
cited deposition testimony states that David Wolenski is “aware of the evolution of the
companies in the ordinary course of business,” Docket No. 76-4 at 3, 182:4-6, and that
EMP is a “contract manufacturer doing precision parts.” Docket No. 76-2 at 3, 41:6-7.
This evidence does not support EMP’s denial. Therefore, the Court deems this fact
admitted.
3 EMP denies this fact on the basis that EMP “did not unilaterally create the
scorecards. EMP provided the scorecards to Mr. Lupton every month, and he reviewed
and agreed to the contents.” Docket No. 76 at 5, ¶ 13. However, the citation to Alan
Lupton II’s deposition statement, while indicating that EMP “sent [ALA] a score card
every month,” does not state that EMP did not unilaterally create the scorecards or that
Mr. Lupton reviewed or agreed to the contents. Docket No. 76-1 at 20, 151:11-12.
Likewise, the scorecard that EMP cites does not indicate that EMP did not unilaterally
create it or that Mr. Lupton reviewed or agreed to its contents. Docket No. 76-7 at 2.
The Court deems this fact admitted.
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 2 of 15

3
products of C&M Machine Products, Inc. (“C&M”) to MKS Instruments Inc. (“MKS”). Id.,
¶ 21. EMP has maintained that C&M is a competitor since, at least, January 18, 2023.
Id., ¶ 23. EMP terminated the contract with ALA, in part, because ALA solicited and
sold PGM’s allegedly competitive products. Id. at 6, ¶ 28.
EMP alleges that, as a result of the breaches of contract, ALA caused
compensatory and consequential damages and lost profits to EMP and has caused ALA
to be overcompensated for services it failed to perform. Id., ¶ 30. EMP’s president and
vice president were unable to identify EMP’s alleged damages during their depositions.4
Id. at 2, 7, ¶¶ 2, 35. EMP did not calculate its damages by the fact discovery deadline
and still had not calculated them by the time ALA filed its motion for summary judgment.
Id. at 8, ¶ 38. Moreover, EMP did not retain an expert witness to offer an opinion on
damages. Id. at 7-8, ¶¶ 36-37.
III. LEGAL STANDARD
Summary judgment is warranted under Federal Rule of Civil Procedure 56 when
the “movant shows that there is no genuine dispute as to any material fact and the
4 EMP refutes this fact on the basis that “EMP has been denied discovery on this
issue and the currently pending motions for contempt sanctions and to reopen discovery
are directed to obtaining drawings that will allow EMP to identify the competitive
products that will allow EMP to calculate damages based on these sales.” Docket No.
76 at 8, ¶ 35. EMP cites two motions it filed: (1) a motion to impose contempt sanctions
against Viasat on the basis that Viasat refused to produce engineering drawings of the
parts that PGM made for Viasat and purchase records for all of the purchases that
Viasat made through ALA, Docket No. 44 at 2-3; and (2) a motion to reopen discovery
for the purpose of obtaining the engineering drawings and purchase records that EMP
had requested from Viasat as well as obtaining the engineering drawings of the parts
that C&M sells to MKS, Docket No. 58 at 3. Docket No. 76 at 8, ¶ 35. Although EMP
has identified an ongoing discovery dispute regarding Viasat and C&M, this information
does not dispute ALA’s asserted fact that EMP’s president and vice president were
unable to identify EMP’s alleged damages during their depositions. Therefore, the
Court deems this fact admitted.
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 3 of 15

4
movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a); see Anderson
v. Liberty Lobby, Inc., 477 U.S. 242, 248-50 (1986). A disputed fact is “material” if,
under the relevant substantive law, it is essential to proper disposition of the claim.
Wright v. Abbott Labs., Inc., 259 F.3d 1226, 1231-32 (10th Cir. 2001). Only disputes
over material facts can create a genuine issue for trial and preclude summary judgment.
Faustin v. City & Cnty. of Denver, 423 F.3d 1192, 1198 (10th Cir. 2005). An issue is
“genuine” if the evidence is such that it might lead a reasonable jury to return a verdict
for the nonmoving party. Allen v. Muskogee, 119 F.3d 837, 839 (10th Cir. 1997).
Where “the moving party does not bear the ultimate burden of persuasion at trial,
it may satisfy its burden at the summary judgment stage by identifying a lack of
evidence for the nonmovant on an essential element of the nonmovant’s claim.”
Bausman v. Interstate Brands Corp., 252 F.3d 1111, 1115 (10th Cir. 2001) (quotations
omitted). “Once the moving party meets this burden, the burden shifts to the nonmoving
party to demonstrate a genuine issue for trial on a material matter.” Concrete Works of
Colo., Inc. v. City & Cnty. of Denver, 36 F.3d 1513, 1518 (10th Cir. 1994). The
nonmoving party may not rest solely on the allegations in the pleadings, but instead
must designate “specific facts showing that there is a genuine issue for trial.” Celotex
Corp., 477 U.S. at 324 (quotations omitted). “To avoid summary judgment, the
nonmovant must establish, at a minimum, an inference of the presence of each element
essential to the case.” Bausman, 252 F.3d at 1115. When reviewing a motion for
summary judgment, a court must view the evidence in the light most favorable to the
non-moving party. Id.
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 4 of 15

5
IV. ANALYSIS
“Under New York law,5 to establish a breach of contract, a plaintiff must show ‘(1)
the existence of an agreement, (2) adequate performance of the contract by the plaintiff,
(3) breach of contract by the defendant, and (4) damages.’” Martell Strategic Funding
LLC v. Am. Hosp. Acad., 2019 WL 632364, at *6 (S.D.N.Y. Feb. 14, 2019) (quoting
Harsco Corp. v. Segui, 91 F.3d 337, 348 (2nd Cir. 1996)) (footnote added). ALA’s
summary judgment motion focuses on the third and fourth elements of EMP’s breach of
contract claim. Docket No. 62 at 9-19. As to EMP’s unjust enrichment claim, ALA
seeks summary judgment on the basis that such claim “arises from ALA’s alleged
breach of the Contract.” Id. at 19.
A. Breach of Contract: Best Efforts Clause
The Contract requires ALA to “use its best efforts to promote, develop and
extend the sales of [EMP’s] services and products.” Docket No. 62 at 3, ¶ 5. As
discussed in the Court’s order on ALA’s motion to exclude the expert testimony of
Joseph V. Gregory, the contract term “best efforts” requires ALA to act with good faith in
light of its own capabilities. Docket No. 194 at 12-13. To establish that ALA did not
exert best efforts, EMP must “show that ‘the nature and extent of [ALA’s] efforts did not
reflect good faith business judgments.’” See Sedona Corp. v. Ladenburg Thalmann &
Co., 2011 WL 4348138, at *2 (S.D.N.Y. Sep. 15, 2011) (quotation and citation omitted).
“[D]etermining whether a party used ‘best efforts’ under a contract ‘almost invariably’ is
a question of fact that cannot be resolved at summary judgment.” India Globalization
5 The Court has determined that New York law applies to the contract between
the parties. Docket No. 194 at 4-8.
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 5 of 15

6
Capital, Inc. v. Apogee Fin. Investments, Inc., 2023 WL 4637551, at *9 (S.D.N.Y. July
20, 2023) (applying New York law) (quoting Kroboth v. Brent, 215 A.D.2d 813, 814 (N.Y.
Sup. Ct. App. Div. 1995)); see Sedona Corp., 2011 WL 4348138, at *2 (“A ‘best efforts’
standard is necessarily contextual . . . and so the meaning of such a provision and the
conditions of its breach are generally factual issues.”) (citations omitted).
ALA argues that it is entitled to summary judgment on EMP’s breach of contract
claim concerning the best efforts clause because “EMP has no evidence showing that
ALA failed to use best efforts, as judged by its own capabilities.” Docket No. 62 at 11.
This argument is based on ALA’s claim that “EMP relies exclusively on the scorecards
and [Mr. Gregory’s]6 expert testimony to establish that ALA breached the Contract’s
best efforts clause” and that this evidence “does not inform whether ALA used its best
efforts, as assessed by its own capabilities.” Id. at 13. p
ALA argues that EMP’s evidence concerning the scorecard cannot establish that
ALA breached the best efforts clause because “ALA’s best efforts are measured by its
own capabilities,” not the metrics on the scorecard. Id. at 11-12. EMP responds that
the scorecards document “ALA’s specific failures.”7 Docket No. 76 at 12. EMP raises
6 ALA’s motion references “Mr. George’s expert testimony,” Docket No. 62 at 12-
13, but the response and reply both discuss the expert testimony of Joseph V. Gregory.
Docket No. 76 at 13-15; Docket No. 79 at 3-4. The Court will interpret ALA’s motion as
referring to Mr. Gregory.
7 The parties also dispute whether Mr. Gregory’s expert report constitutes
evidence that ALA breached the best efforts clause, but since the Court finds that the
disputed facts derived from the scorecard and from Mr. Lupton’s testimony are sufficient
to raise a disputed issue of fact precluding summary judgment on this claim, it will not
discuss Mr. Gregory’s report.
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 6 of 15

7
the disputed fact8 that the scorecard it created tracked nine deficiencies in ALA’s
performance, including that “the number of ALA representatives regularly engaged in
selling EMP is unacceptably low,” that the “new sales representative for California
hadn’t been heard from in 4+ months,” that “[t]he sales representative for Jabil9 stopped
returning emails,” and that “[n]o new ITAR10 opportunities had been created, despite
ALA’s representation that it could pursue and win new sales for EMP’s Aerospace
Subsidiary once it had become ITAR registered.” Docket No. 76 at 8-9, ¶¶ 3-4a, 4e-f,
4h. ALA argues that the scorecards “do not constitute evidence of breach of the best
efforts clause because ALA never had a contractual obligation to perform according to
the criteria included on them.” Docket No. 79 at 3. EMP does not claim that ALA had a
contractual obligation to perform according to the criteria included on the scorecards.
Rather, EMP argues that “ALA’s specific failures are well documented in the
scorecards.” Docket No. 76 at 12. Because the scorecard is evidence concerning the
efforts ALA was exerting, EMP’s reference to the assessments of ALA’s efforts in the
scorecard raises a genuine dispute of fact as to whether ALA was exerting best efforts
to promote, develop, and extend the sales of EMP’s services and products compliance
with the Contract.
Moreover, EMP raises disputed facts concerning ALA’s efforts that are drawn
from evidence other than the scorecard or Mr. Gregory’s expert testimony. Docket No.
8 ALA’s reply did not admit or deny any of the disputed facts that EMP raised in
its response. Therefore, all of the facts EMP raised in its response are deemed
disputed.
9 Jabil is an EMP customer. Docket No. 76 at 10, ¶ 17.
10 International Traffic in Arms Regulations.
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 7 of 15

8
76 at 9-10, ¶¶ 5-16. EMP asserts the following disputed facts based on deposition
testimony from Mr. Lupton:
• 	Prior to February 2022, ALA was not using a functional customer
relations management system (“CRM”) to manage its business.
• 	ALA was using a spreadsheet to track opportunities, instead of a
CRM, and this spreadsheet was inferior to the CRM data
collection and analysis capabilities.
• 	ALA lacked a structured hiring and on-boarding process.
• 	ALA did not provide formal sales training to its representatives.
• 	ALA did not provide effective scripts to its sales representatives
for phone call introductions of EMP.
• 	ALA did not use a repeatable, step-by-step sales process.
• 	ALA does not set annual forecasts or sales revenue targets,
including new customer business, for each salesperson.
• 	ALA does not have performance improvement plans for
underperforming sales representatives.
• 	In 2020, 50% of EMP’s sales were derived from one customer,
and the majority of EMP’s sales were derived from legacy
accounts. EMP urgently requested ALA to develop new
customers to manage volatility and diversify risk.
• 	EMP’s sales decreased 15.8% from 2018 to 2019.
Id. at 9-10, ¶¶ 5-12, 14-15. These disputed facts drawn from Mr. Lupton’s testimony go
to whether the “nature and extent” of ALA’s efforts reflected good faith business
judgments. See Sedona Corp., 2011 WL 4348138, at *2. Therefore, there is a genuine
dispute of material fact as to whether ALA acted with good faith in light of its own
capabilities. The Court will therefore decline to dismiss EMP’s breach of contract claim
based on the best efforts clause.
B. Breach of Contract: Noncompete Clause
It is undisputed that the Contract contains a noncompete clause stating that ALA
“shall not directly or indirectly solicit orders for or sell any products competitive with
[EMP’s] products without its written consent” and that a 2000 amendment to the
Contract defines “competitive” as “the products of a general-purpose production
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 8 of 15

9
machining job shop.” Docket No. 62 at 3, ¶¶ 5, 7; Docket No. 62-1 at 1, 5, ¶¶ 1, 2. It is
also undisputed that EMP maintains that PGM and C&M are competitors. Docket No.
62 at 5, ¶¶ 22-23.
ALA argues that “EMP cannot prove that ALA breached the noncompete clause
by soliciting or selling PGM’s and C&M’s products[ ] because EMP has no evidence that
PGM or C&M are ‘general-purpose production machining job shop[s].’” Id. at 14. EMP
responds that the evidence shows that “EMP and PGM are competitors, regardless of
the outdated terminology used in the Contract,” and that ALA presented C&M to
manufacture parts for MKS that EMP could have produced. Docket No. 76 at 16.
However, EMP has not raised disputed facts indicating that PGM or C&M are general-
purpose production machining job shops11 or that “competitive” as used in the Contract
means something other than “the products of a general purpose production machining
job shop.”12 Therefore, EMP has not raised a genuine dispute of fact indicating that
11 EMP states that Mr. Lupton admitted that the contract terminology is “nebulous
and not subject to an exact definition.” Docket No. 76 at 16; see Docket No. 76-1 at 3-
4, 22:21- 23:2 (stating that “general machining” and “precision machining” are “nebulous
phrases”). However, Mr. Lupton’s comments about the term “general machining” do not
raise a genuine issue of fact as to whether PGM or C&M are general-purpose
production machining job shops.
12 EMP denies this fact without citing evidence to support its denial. Docket No.
76 at 4, ¶ 7. The Court will therefore deem this fact admitted. EMP adds that the
“definition of ‘competitive’ has changed due to the parties’ course of dealing.” Id.
Assuming that EMP is attempting to establish a fact, the Court’s practice standards
require that a party must do so in a separate statement of additional facts. See Practice
Standards (Civil Cases), Chief Judge Philip A. Brimmer, § III.F.3.b.v. EMP did not
assert that the definition of “competitive” has changed in its statement of additional
disputed facts. Moreover, even if EMP had included this assertion in its statement of
additional facts, the evidence it cites does not indicate that the definition of “competitive”
changed as a result of the parties’ course of dealing. EMP cites deposition testimony by
EMP’s vice president that he is “aware of the evolution of the companies in the ordinary
course of business,” Docket No. 76-4 at 3, 182:4-6; and deposition testimony from an
individual named Steven Bronson that EMP is “more of a contract manufacturer doing
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 9 of 15

10
ALA breached the noncompete clause by selling PGM’s or C&M’s products. The Court
will grant summary judgment in favor of ALA on EMP’s claim that ALA breached the
noncompete clause.
C. Damages
ALA argues that EMP has failed to identify compensatory and consequential
damages stemming from ALA’s alleged breach of the Contract. Docket No. 62 at 15-16.
It is undisputed that EMP did not calculate its damages by the fact discovery deadline,
March 15, 2023, and still had not calculated its damages by the time ALA filed its motion
for summary judgment. Id. at 6, 8, ¶¶ 30, 38. 	EMP argues that it has a substantial
justification for not disclosing these calculations because “the documents from which
these calculations will necessarily be based are being improperly withheld from EMP.”
Docket No. 76 at 17.
At the time that ALA filed its motion for summary judgment, there was an ongoing
discovery dispute concerning documents related to ALA’s sale of PGM parts to Viasat
and C&M parts to MKS. See Docket No. 44 at 2; Docket No. 58 at 1-2. EMP had filed
(1) a motion for sanctions asking the Court to compel Viasat to produce engineering
drawings of the parts that PGM made for Viasat and purchase records for all purchases
that were brokered by ALA, Docket No. 44 at 2-4; and (2) a motion to reopen discovery
precision parts.” Docket No. 76-2 at 3, 41:6-7. Docket No. 76 at 4, ¶ 7. Under New
York law, “a course of dealing can only be established by the previous conduct of the
parties to the contract.” V.J. Gautieri Inc. v. State of N.Y., 195 A.D. 2d 669, 671 (N.Y.
App. Div. 1993). Because EMP’s evidence does not concern the previous conduct of
the parties, it does not support EMP’s assertion that the definition of “competitive”
changed as a result of the parties’ course of dealing. Accordingly, even if EMP had
included this assertion in its statement of disputed facts, it would not have raised a
disputed fact concerning a changed definition of “competitive.”
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 10 of 15

11
so that EMP could obtain engineering drawings of the parts that C&M made for MKS as
well as the drawings and purchase records that EMP requested from Viasat. Docket
No. 58 at 3. EMP sought the engineering drawings in order to determine whether the
parts made by PGM and C&M were competitive with parts manufactured by EMP.
Docket No. 44 at 2-3; Docket No. 58 at 3. EMP sought the sales data from Viasat in
order to “identify any other manufacturers [ALA] has represented to Viasat and confirm
the sales numbers of such products.” Docket No. 44 at 3. Accordingly, the documents
that EMP sought relate only to EMP’s claim that ALA breached the noncompete clause
of the Contract by selling competitive products. Since the Court is granting summary
judgment on this claim, whether EMP has a substantial justification for its failure to
disclose the damages caused by ALA’s alleged breach of the noncompete clause is
irrelevant.
EMP offers no explanation why discovery disputes related to ALA’s alleged
breach of the noncompete clause prevented EMP from making any disclosures
regarding damages caused by ALA’s alleged breach of the best efforts clause.
Moreover, EMP has not filed a properly supported request pursuant to Federal Rule of
Civil Procedure 56(d) for the Court to defer ruling on this issue on the basis that EMP is
unable to present facts essential to justify its opposition to summary judgment on the
issue of damages. See Fed. R. Civ. P. 56(d).
ALA argues that, “[e]ven if EMP had identified its alleged damages, EMP has no
evidence to support damages.” Docket No. 62 at 16. EMP argues that its president
and vice president can testify as to the damages resulting from the alleged breach of
the best efforts clause because they “can testify as fact witnesses to trends in EMP’s
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 11 of 15

12
sales over the past decade, and these trends represent sales growth that could have
been achieved if ALA exercised its best efforts in performance of the Contract.” Docket
No. 76 at 19. However, it is undisputed that these witnesses were unable to identify
EMP’s alleged damages during their depositions, Docket No. 62 at 7, ¶ 35, and EMP
has not indicated that they would be able do so at trial. Accordingly, EMP has failed to
raise a genuine question of material fact as to the existence of compensatory and
consequential damages resulting from the alleged breach of the best efforts clause.
The Court will grant summary judgment as to that part of the damages element of
EMP’s claim that alleges compensatory and consequential damages. See Fed. R. Civ.
P. 56(a) (“A party may move for summary judgment, identifying . . . the part of each
claim . . . on which summary judgment is sought. The 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.”).
ALA argues that the Court should dismiss EMP’s breach of contract claim
because EMP cannot establish that it is entitled to compensatory and consequential
damages. Docket No. 62 at 15-19. Although a plaintiff must show damages to
establish a breach of contract, “it is a well-settled tenet of contract law that even if the
breach of contract caused no loss or if the amount of the loss cannot be proven with
sufficient certainty, the injured party is entitled to recover as nominal damages a small
sum fixed without regard to the amount of the loss, if any.” Martell Strategic Funding,
2019 WL 632364, at *6-7 (quoting Schanfield v. Sojitz Corp. of Am., 663 F. Supp. 2d
305, 348 (S.D.N.Y. 2009) (alteration omitted)). Furthermore, “it is appropriate to deny a
defendant’s motion for summary judgment on the issue of damages where, even if the
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 12 of 15

13
plaintiff has not proven actual damages, nominal damages could be awarded.” Zurich
Am. Life. Ins. Co. v. Nagel, 590 F. Supp. 3d 702, 719-720 (S.D.N.Y. 2022) (applying
New York law) (collecting cases); see also Fantasia v. Montefiore New Rochelle, 2022
WL 20540940, at *5 (S.D.N.Y. Jun. 16, 2022) (noting that nominal damages are a
generally accepted remedy in contract actions and holding that, because plaintiff
requested compensatory damages in her complaint, she may seek nominal damages at
trial) (citing Irish Lesbian & Gay Org. v. Giuliani, 143 F.3d 638, 651 (2nd Cir. 1998)).
Here, the Court has declined to grant summary judgment on the breach element of
EMP’s claim concerning breach of the best efforts clause. Because EMP could be
awarded nominal damages on this basis, the Court will not dismiss EMP’s breach of
contract claim in its entirety, but will only grant summary judgment as to compensatory
and consequential damages.
D. Unjust Enrichment
ALA argues that it is entitled to summary judgment on EMP’s unjust enrichment
claim because the claim “arises from ALA’s alleged breach of the Contract.” Docket No.
62 at 20. EMP argues that it would be premature to grant summary judgment on the
unjust enrichment claim because the Court has not yet made any determinations about
what conduct falls within the scope of the Contract. Docket No. 76 at 20. EMP’s
complaint alleges that ALA “has been unjustly enriched and received the benefit at
Plaintiff EMP's expense by the material nonperformance under the [Contract] and failure
to use its best efforts to provide sales services and assistance to EMP.” Docket No. 84
at 7, ¶ 31.
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 13 of 15

14
Under both Colorado and New York law,13 a party may not recover for unjust
enrichment when an express contract covers the same subject matter. Interbank Invs.,
LLC v. Eagle River Water & Sanitation Dist., 77 P.3d 814, 816 (Colo. App. 2003) (“In
general, a party cannot recover for unjust enrichment by asserting a quasi-contract
when an express contract covers the same subject matter because the express contract
precludes any implied-in-law contract.”) (citation omitted); IDT Corp. v. Morgan Stanley
Dean Witter & Co., 907 N.E. 2d 268, 274 (N.Y. 2009) (“Where the parties executed a
valid and enforceable written contract governing a particular subject matter, recovery on
a theory of unjust enrichment for events arising out of that subject matter is ordinarily
precluded.”) (citation omitted). Because EMP’s unjust enrichment claim is based on
alleged “material nonperformance” of the Contract and failure to use best efforts to
provide sales and assistance to EMP, Docket No. 84 at 7, ¶ 31, the subject matter of
the unjust enrichment claim is covered by an express contract, namely, the Contract.
Therefore, EMP may not recover14 for unjust enrichment. The Court will grant summary
judgment in favor of ALA on this claim.
13 The Court will not conduct a choice of law analysis as to EMP’s unjust
enrichment claim because the outcome is the same under either Colorado or New York
law. See Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 839 n.20 (1985) (“If the laws of
both states relevant to the set of facts are the same, or would produce the same
decision in the lawsuit, there is no real conflict between them.”) (citation omitted); Berg
Chilling Sys., Inc. v. Hull Corp., 435 F.3d 455, 462 (3d Cir. 2006) (“According to conflicts
of laws principles, where the laws of the two jurisdictions would produce the same result
on the particular issue presented, there is a ‘false conflict,’ and the Court should avoid
the choice-of-law question.”) (citation omitted).
14 Although a plaintiff “may plead claims for breach of contract and unjust
enrichment in the alternative, a party cannot recover for unjust enrichment by asserting
a quasi-contract when an express contract covers the same subject matter because the
express contract precludes any implied-in-law contract.” Stone Creek Bus. Center,
LLLP v. Stone Creek-Colorado, LLC, No. 20-cv-01413-PAB-GPG, 2022 WL 4448822, at
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 14 of 15

15
V. CONCLUSION
Therefore, it is
ORDERED that Defendant’s Motion for Summary Judgment [Docket No. 62] is
GRANTED in part and DENIED in part. It is further
ORDERED that the portion of EMP’s first cause of action that alleges a breach of
the noncompete clause is DISMISSED with prejudice. It is further
ORDERED that EMP’s second cause of action is DISMISSED with prejudice.
DATED March 15, 2024.
BY THE COURT:
___________________________
PHILIP A. BRIMMER
Chief United States District Judge
*2 (D. Colo. Sep. 23, 2022) (quotation and citation omitted) (granting summary
judgment in favor of defendant on unjust enrichment claim).
Case No. 1:22-cv-00763-PAB-SBP Document 195 filed 03/15/24 USDC Colorado
pg 15 of 15