A.C. Consulting, LLC v. Alexion Pharm., Inc.

• Decision Date: 12 November 2019
• Docket Number: AC 41814
• Citation: 194 Conn.App. 316,220 A.3d 890
• Court: Connecticut Court of Appeals
• Parties: A.C. CONSULTING, LLC v. ALEXION PHARMACEUTICALS, INC.

194 Conn.App. 316

220 A.3d 890

A.C. CONSULTING, LLC

v.ALEXION PHARMACEUTICALS, INC.

AC 41814

Appellate Court of Connecticut.

Argued September 12, 2019

Officially released November 12, 2019

Kevin D. Scully, Waterbury, for the appellant (plaintiff).

Jeffrey R. Babbin, New Haven, with whom were Christine Salmon Wachter and, on the brief, Lawrence Peikes, Stamford, for the appellee (defendant).

Prescott, Elgo and Sheldon, Js.

PRESCOTT, J.

The plaintiff, A.C. Consulting, LLC, appeals from the judgment of the trial court rendered in favor of the defendant, Alexion Pharmaceuticals, Inc., following the granting of the defendant's motion to strike the plaintiff's substitute complaint. The substitute complaint contained three counts alleging, respectively, breach of contract, negligent misrepresentation, and breach of the covenant of good faith and fair dealing. On appeal, the plaintiff claims that, in evaluating the legal sufficiency of the allegations in the substitute complaint, the trial court improperly (1) failed both to find an ambiguity in the parties' contract regarding its operative length and to construe that ambiguity against the defendant as the drafter of the contract, (2) concluded that the plaintiff's allegation that the defendant terminated the contract without giving the plaintiff "sufficient notice under the contract" was legally insufficient to state a claim for breach of contract, and (3) concluded that the allegations that the defendant or the defendant's agent made assurances regarding the length of the contract were insufficient to plead any of the plaintiff's causes of action, including negligent misrepresentation.¹ We affirm the judgment of the trial court.

The following facts, as alleged in the operative complaint, and procedural history are relevant to our resolution of the present appeal. In July, 2011, the plaintiff, through its sole member, James Dolan, entered into a service contract with the defendant, in which the plaintiff agreed to provide the defendant with "administrative support and coordination of security details for heightened risk employee travel." Dolan had acquired expertise and knowledge in the field of security during his lengthy employment with the Connecticut state police. The service contract expired by its terms on December 31, 2012. The operative complaint, however, alleged that the service contract expired on December 31, 2011. The parties subsequently entered into a second service contract with similar terms in March, 2012. That contract expired on December 31, 2012.

In January, 2013, the parties entered into a third service contract (contract), which is the subject matter of the present action. Prior to executing the contract, the plaintiff, through Dolan, had expressed to the defendant its desire for a longer period of contractual commitment from the defendant. The defendant had assured Dolan that the plaintiff would have the defendant's security business "so long as he wanted it" and that, at the very least, he had an almost four year commitment from the defendant.² (Internal quotation marks omitted.) The contract provided that it was operative through December 31, 2016, a term of approximately four years. The contract further provided, however, that the plaintiff would act as an independent contractor and that the defendant could terminate the contract "upon five (5) days written notice." The defendant's right to terminate the contract was otherwise unconditional. The contract contained no reciprocal provision that authorized the plaintiff to terminate the contract prior to its expiration. Finally, the contract contained a clause providing that (1) it could not be altered except by a written agreement signed by both parties, (2) it represented the entire agreement of the parties, and (3) it "supersede[d] all previous written and oral negotiations, commitments, and understandings."

In the summer of 2013, the defendant asked the plaintiff to create a job description for a new position within the defendant's organization titled "Senior Manager of Global Security." The defendant's director of global security, Robert Weronik, told Dolan that he should not apply for the position, reassuring Dolan that the plaintiff would have the defendant's heightened risk employee travel business for as long as the plaintiff wanted it. Weronik, however, knew, or should have known, that the new senior manager would "probably look to terminate the plaintiff."

The defendant terminated its contract with the plaintiff on November 17, 2014. The defendant did not cite to any breach of the contract by the plaintiff and failed to give sufficient notice of the termination. Prior to terminating the contract, the defendant had reduced the plaintiff's hours and responsibilities, and had required Dolan to "report to the [defendant] at least two days a week and prepare detailed reports to the defendant," all of which the plaintiff considered to be unilateral changes to the terms and conditions of the parties' contract. The plaintiff theorized that, during the course of its business relationship with the defendant, "the defendant gained vast knowledge from the plaintiff on the means and methods of security" and that "[w]hen the defendant had gained sufficient knowledge," it terminated its agreement with the plaintiff.

On October 13, 2016, the plaintiff commenced the underlying action. The initial complaint consisted of a single count that expressly alleged only a breach of the covenant of good faith and fair dealing. The defendant filed a request to revise, indicating that the complaint contained allegations that could be read as advancing additional theories of recovery, such as breach of contract or wrongful discharge, and asking the plaintiff to set forth each cause of action it intended to pursue in a separate count. The plaintiff objected to the request to revise but ultimately requested leave of the court to file a two count amended complaint. Count one of the amended complaint alleged that the defendant had breached an express term of the contract, and count two alleged that the defendant had breached the covenant of good faith and fair dealing.

The defendant filed a motion to strike the amended complaint, arguing that the first count failed as a matter of law because the plaintiff had failed to allege what contractual term the defendant had breached, and the second count failed because the factual allegations were insufficient to establish that the defendant had breached any contractual obligation owed to the plaintiff or that the defendant had acted in bad faith. The court, Ecker , J. , granted the motion to strike, stating: "Accepting the plaintiff's factual allegations as true, and applying the legal standard governing a motion to strike, the court finds as a matter of law that nothing about the actions of the defendant breach any contractual terms or constitute a breach of the covenant of good faith and fair dealing. The plaintiff's arguments regarding procedural and substantive unconscionability do not help save either claim."³

On September 1, 2017, the plaintiff elected to replead; see Practice Book § 10-44 ;⁴ and filed a substitute complaint. The substitute complaint contained three counts. Count one again alleged a breach of contract, count two alleged a new cause of action sounding in negligent misrepresentation,⁵ and count three alleged a breach of the covenant of good faith and fair dealing. The plaintiff appended copies of the parties' three service contracts to the substitute complaint.⁶

The defendant filed a motion to strike the substitute complaint and a supporting memorandum of law. It argued first that, with respect to counts one and three of the substitute complaint, the plaintiff had added only a few new allegations to those set forth in the stricken amended complaint, none of which helped to overcome the deficiencies in the plaintiff's prior pleading, which the court had determined failed to state a legally cognizable cause of action. In addition to claiming that the prior ruling should be treated as the law of the case with respect to those counts alleging a breach of contract and a breach of the covenant of good faith and fair dealing, it also argued that, like the prior amended complaint, the breach of contract count failed as a matter of law because none of the defendant's alleged actions could be construed as breaching a contractual term. Similarly, the defendant asserted that the third count failed because the plaintiff both failed to allege that the defendant had breached any contractual obligation owed to the plaintiff and that the defendant had done so in bad faith.

With respect to the new cause of action alleging negligent misrepresentation, the defendant argued that that count also failed to state a cognizable claim for relief because the plaintiff's allegations that it relied on statements made by the defendant's agent were of no legal significance in light of the fully integrated contract, which, by its express terms, precluded the plaintiff from relying on any alleged oral representations that were inconsistent with the contract's terms.

The plaintiff filed an objection to the motion to strike and a memorandum in opposition. It argued that the substitute complaint contained additional allegations not found in the amended complaint, rendering the law of the case doctrine inapplicable. It further argued that the allegations that the defendant had assured Dolan that "his job" was secure despite terminating the contract prior to its expiration were legally sufficient to support a claim of negligent misrepresentation. The defendant filed a reply memorandum, and the plaintiff filed a surreply memorandum.

The court, Wahla , J. , issued a decision on May 1, 2018, rejecting the plaintiff's arguments and granting the motion to strike all counts. Specifically, after setting forth the appropriate standard of review, the court stated as follows: "In the present case, the...