Paragon Dig. Lifestyle v. Adaptive Micro-Ware, Inc.
| Decision Date | 22 September 2022 |
| Docket Number | 20-CV-4725 (JMF) |
| Parties | PARAGON DIGITAL LIFESTYLE INC., Plaintiff, v. ADAPTIVE MICRO-WARE, INC., Defendant. |
| Court | U.S. District Court — Southern District of New York |
Plaintiff Paragon Digital Lifestyle Inc. (“DigiValet”) provides products and services to hotels to enable guests to control room amenities and hotel services from a tablet computer, or smartphone. In 2017, the company entered into an agreement with Defendant Adaptive MicroWare, Inc. (“Adaptive”) pursuant to which Adaptive was to create a technology solution that would enable DigiValet to program its products to control televisions in North American hotels. In the agreement, Adaptive estimated that the third and critical phase of the project would take only four to five weeks to complete. More than one year later, however Adaptive still had not delivered. Fed up, DigiValet declared Adaptive to be in breach of the agreement and requested its money back; Adaptive refused. This lawsuit, in which DigiValet brings a claim for breach of contract and a claim for unjust enrichment, followed. Each party now moves pursuant to Rule 56 of the Federal Rules of Civil Procedure for summary judgment. For the reasons that follow, the Court grants summary judgment to DigiValet on the contract claim and awards it $272,486 in damages. In light of that conclusion, the Court dismisses the unjust enrichment claim.
Before turning to the relevant facts, the Court feels compelled to comment on several disheartening aspects of Adaptive's motion papers. First, Adaptive's initial memorandum of law is noteworthy for its lack of relevant analysis. Adaptive spends nearly fifteen pages reciting the facts and the applicable legal standards and devotes barely more than three pages to analysis of DigiValet's contract claim, the central issue in dispute. See ECF No. 56 (“Def.'s Mem.”), at 1518. Second, and even more noteworthy, Adaptive's second memorandum of law - in opposition to DigiValet's cross-motion and in further support of Adaptive's motion - is virtually identical to its initial memorandum of law, literally repeating whole swathes of the initial memorandum verbatim and failing to respond to many of DigiValet's arguments. See ECF No. 68 (“Def.'s Reply). Third, Adaptive includes its “Statement” and “Counterstatement” of undisputed facts in its memoranda of law, see Defs.' Mem. 9-14; Defs.' Reply 15-23, in violation of the Local Civil Rules, which require “a separate, short and concise statement, in numbered paragraphs, of the material facts as to which the moving party contends there is no genuine issue to be tried.” Local Civil Rule 56.1(a) (emphasis added).
But worst of all, in its memoranda and Local Rule 56.1 “Statements,” Adaptive cites to entire exhibits, many of which are hundreds of pages long, instead of citing with particularity to evidence that supports its arguments. To give but one example: Adaptive's “Exhibit E” - to which it cites repeatedly in its papers - includes nearly six-hundred pages of emails that were sent over a span of years. ECF Nos. 56-5 to 56-8. Making matters (even) worse, Adaptive filed these hundreds of pages of emails as an attachment to its motion without any kind of affirmation or authentication as to their accuracy. See e.g., Elghourab v. Vista JFK, LLC, No. 17-CV-911 (ARR)(ST), 2018 WL 6182491, at *2 (E.D.N.Y. Nov. 27, 2018) ; see also ECF No. 63-39 (“Pl.'s Mem.”), at 17 & n.7.
Admissibility aside, this does not comport with Rule 56 of the Federal Rules of Civil Procedure and Local Civil Rule 56.1, which require a party moving for or opposing summary judgment to cite to “particular parts of materials in the record.” Fed.R.Civ.P. 56(c)(1)(A) (emphasis added). Indeed, “in order to survive [or prevail on] a motion for summary judgment, [a party's] counsel must specifically identify relevant facts and explain why those facts justify denying [or granting] the summary judgment motion.” Collins v. City of New York, No. 14-CV-8815 (AJN), 2017 WL 11582468, at *2 (S.D.N.Y. July 10, 2017) (Nathan, J.) (emphasis added). Or as the Sixth Circuit has put it: Guarino v. Brookfield Twp. Trs., 980 F.2d 399, 405-06 (6th Cir. 1992); see also, e.g., In re Agent Orange Product Liability Litig., 517 F.3d 76, 91 n.14 (2d Cir. 2008) (“Fed. R. Civ. P. 56 does not impose an obligation on the court considering a motion for summary judgment to perform an independent review of the record to find proof of a factual dispute.” (cleaned up) (citation omitted); Amnesty Am. v. Town of W. Hartford, 288 F.3d 467, 470 (2d Cir. 2002) (Sotomayor, J.) ().
The Court is tempted to deny Adaptive's motion and grant DigiValet's cross-motion on the basis of these deficiencies alone. At a minimum, the Court would be on firm ground deeming the facts set forth in DigiValet's (procedurally proper) Local Rule 56.1 Statement to be admitted. See Local Civil Rule 56.1(c) (); see, e.g., Giannullo v. City of New York, 322 F.3d 139, 140 (2d Cir. 2003) (“If the opposing party . . . fails to controvert a fact so set forth in the moving party's Rule 56.1 statement, that fact will be deemed admitted.”); Emanuel v. Griffin, No. 13-CV-1806 (JMF), 2015 WL 1379007, at *2 (S.D.N.Y. Mar. 25, 2015) (). But the Court need not take either of these paths for the simple reason that the evidence - most of which is documentary and, therefore, undisputed - supports the same results.[1] Accordingly, the Court now turns to that evidence.
The following facts are drawn from the admissible materials submitted by the parties in connection with these motions and are either undisputed or described in the light most favorable to Adaptive. See Costello v. City of Burlington, 632 F.3d 41, 45 (2d Cir. 2011).
DigiValet is a company that provides products and services to hotels to enable guests to control room amenities and hotel services from a tablet, computer, or smartphone. See Pl.'s Mem. 3. In 2017, DigiValet was preparing, for the first time, to supply a North American hotel with a tablet solution that would include control of the in-room television set, but it discovered that it would need to use different technology to decrypt the television streams than it had used in other parts of the world. ECF No. 63-1 (“Salgia Decl.”), ¶¶ 4-5. About 95% of the North American market encrypts television signals using a technology called Pro:Idiom that was developed by Zenith Electronics. Id. ¶ 4. DigiValet hired Adaptive to create a decryption solution, in no small part because Adaptive touted its experience working with Zenith's systems. Id. ¶ 7; see also ECF No. 63-3, at 2 ().
On September 5, 2017, the parties signed a contract titled “Engineering Agreement for DigiValet.” ECF No. 63-4 (the “Agreement”).[2] The Agreement - which was drafted by Adaptive - specified the requirements of Phase I of the project, during which Adaptive was to create a “Detailed Specification document,” namely an engineering blueprint for the project. Id. at 2. Significantly, the Agreement acknowledged that “[t]his project has an urgent time to market requirement” and promised that “Adaptive will provide its services . . . to ensure its most flexible scheduling and availability to support this urgency.” Id. More specifically, Adaptive provided an estimate that “the completion of the Detailed Specification is expected to take approximately three to five weeks to complete.” Id.
As required by the Agreement, DigiValet paid Adaptive an initial deposit of $25,000 on September 5, 2017. Salgia Decl. ¶ 13; see ECF No. 63-5. On that same day, Adaptive emailed DigiValet requesting a copy of DigiValet's licensing agreement with Zenith, which DigiValet sent the very next day. Salgia Decl. ¶¶ 14-15; see ECF Nos. 63-6, at 2, 63-7. Nevertheless, and despite its initial estimate of only three to five weeks, Adaptive did not produce the Detailed Specification Document until February 20, 2018 - more than six months later. Salgia Decl. ¶¶ 16-17; see ECF No. 63-9. In its email providing the blueprint, Adaptive advised that the diagram and parts list were “suitable for use with your hardware designer” and explained that it would “next provide the system and software . . . and will also follow up as [DigiValet] requested with [its] estimates to support the creation of the FPGA firmware, as well as . . . to help power up and test the initial prototype.” ECF No. 63-9, at 2. Relying on Adaptive's Detailed Specification...
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