Solidfx, LLC v. Jeppesen Sanderson, Inc.

• Decision Date: 22 March 2013
• Docket Number: Civil Action No. 11–cv–01468–WJM–BNB.
• Citation: 935 F.Supp.2d 1069
• Parties: SOLIDFX, LLC, Plaintiff, v. JEPPESEN SANDERSON, INC., Defendant.
• Court: U.S. District Court — District of Colorado

935 F.Supp.2d 1069

SOLIDFX, LLC, Plaintiff,

v.JEPPESEN SANDERSON, INC., Defendant.

Civil Action No. 11–cv–01468–WJM–BNB.

United States District Court, D. Colorado.

March 22, 2013.

Dale R. Harris, Edward J. Hafer, John Allen Francis, Kenzo Sunao Kawanabe, Lauren Michele Mitchell, Matthew Courtney Baisley, Natalie Elizabeth West, Shannon Wells Stevenson, Davis Graham & Stubbs, LLP, Denver, CO, for Plaintiff.

Craig S. Primis, Gregory Lee Skidmore, John Caviness O'Quinn, Michael Adam Glick, Kirkland & Ellis, LLP, Washington, DC, Michael Alex Sink, Robert Nolen Miller, Perkins Coie LLP, Denver, CO, for Defendant.

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION FOR SUMMARY JUDGMENT AND DENYING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT

WILLIAM J. MARTÍNEZ, District Judge.

Plaintiff SolidFX, LLC (“Plaintiff”) brings this action against Defendant JeppesenSanderson, Inc. (“Defendant”) alleging violations of the Sherman Antitrust Act, 15 U.S.C. §§ 1 et seq., as well as common law contract and quasi-contract claims. (Sec. Am. Compl. (“SAC”) (ECF No. 158) pp. 20–37.) Before the Court are the following motions: (1) Plaintiff's Partial Motion for Summary Judgment (ECF No. 96); and (2) Defendant's Motion for Summary Judgment (ECF No. 130). For the reasons set forth below, Plaintiff's Motion is denied, and Defendant's Motion is granted in part and denied in part.

I. LEGAL STANDARD

Summary judgment is appropriate only if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Henderson v. Inter–Chem Coal Co., Inc., 41 F.3d 567, 569 (10th Cir.1994). Whether there is a genuine dispute as to a material fact depends upon whether the evidence presents a sufficient disagreement to require submission to a jury, or conversely, is so one-sided that one party must prevail as a matter of law. Anderson v. Liberty Lobby, 477 U.S. 242, 248–49, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Stone v. Autoliv ASP, Inc., 210 F.3d 1132 (10th Cir.2000); Carey v. U.S. Postal Service, 812 F.2d 621, 623 (10th Cir.1987).

A fact is “material” if it pertains to an element of a claim or defense; a factual dispute is “genuine” if the evidence is so contradictory that if the matter went to trial, a reasonable party could return a verdict for either party. Anderson, 477 U.S. at 248, 106 S.Ct. 2505. The Court must resolve factual ambiguities against the moving party, thus favoring the right to a trial. Houston v. Nat'l General Ins. Co., 817 F.2d 83, 85 (10th Cir.1987).

II. FACTUAL BACKGROUND

The relevant facts ¹, viewed in the light most favorable to the non-movant, are as follows.

Defendant Jeppesen is a subsidiary of the Boeing Company and is a creator and seller of terminal charts (“Terminal Charts” or “Charts”) that graphically represent details of airports and their surroundings; it has been in this business since 1934. (ECF No. 128 ² ¶¶ 1, 3; ECF No. 164 ¶ 6.) Defendant's Charts are produced using publically available information which it compiles into a unique proprietary format that includes Defendant's own symbology, colors, fonts, and distinctive layout. ( Id. ¶¶ 5–6.) Defendant's Terminal Charts are copyrighted. ( Id. ¶ 8.)

Plaintiff SolidFX is a small software company that creates software applications to access, organize, and use critical data. (ECF No. 164 ¶ 1.) Both principals of SolidFX are private pilots with substantial experience and training in the technology field. ( Id. ¶¶ 2–5.)

Historically, pilots have carried heavy binders of paper terminal charts. (ECF No. 164 ¶ 45.) Over the past 15 years, charts have increasingly been distributed electronically, but limitations have existed due to the electronic devices' (such as laptop computers) limited battery life, awkwardness,and efficiency. (ECF No. 128 ¶ 4; 164 ¶ 45.) In 2008, Plaintiff anticipated rapid development in the efficiency, battery life, and display technology of mobile computing devices and began developing software that would allow pilots to access terminal charts on these devices in the cockpit. (ECF No. 164 ¶ 47.) At that time, there were few mobile devices on the market that would support third-party software development. ( Id. ¶ 48.)

In November 2008, Defendant contacted Plaintiff about forming a business relationship in which Plaintiff would develop software for pilots to access Defendant's Terminal Charts on e-book viewers. ( Id. ¶ 49.) Plaintiff began developing software to display Defendant's Charts on an e-book viewer manufactured by iRex Technologies (“iRex”). ( Id. ¶ 48.) Plaintiff touted the advantages of using an e-book viewer for displaying Defendant's Terminal Charts because the e-ink technology required limited battery usage and was visible in bright sunlight, as was required for use in a cockpit. (ECF No. 128 ¶ 71.)

In April 2009, Plaintiff demonstrated its iRex prototype to Defendant at an aviation convention. (ECF No. 128 ¶ 76.) The parties then agreed to move forward with their relationship and began negotiating a licensing agreement (“Agreement”). ( Id. ¶ 77.) The first draft of the Agreement specifically referenced the iRex device and limited Plaintiff's licensing rights to that device only. (ECF No. 164 ¶ 58.) Plaintiff sent a revised draft to Defendant that, in relevant part, used the more general term “e-book viewer”. ( Id. ¶ 59.)

On December 31, 2009, the final version of the Agreement was executed by the parties. ( Id. ¶ 56.) The relevant portions of the Agreement are discussed in the Analysis section below. However, the Agreement generally gave Plaintiff a license to develop a “data management reader solution” that works in conjunction with an e-book viewer to access, use, and display Jeppesen's copyrighted Terminal Charts. (Agmt. (ECF No. 128–2) § 1.6.) In addition to the Terminal Charts, the Agreement gave Plaintiff a license to use Defendant's copyrighted Jeppesen Integration Toolkits (“JIT”) which are proprietary products that allow the integration of the Terminal Charts in third party systems. ( Id. § 1.5.) The term of the Agreement was for a period of five years, and was renewable. ( Id. § 5.)

Under the Agreement, Defendant was to provide Plaintiff with the JIT and technical support for the development of the software necessary to display the Terminal Charts on an e-book viewer. (Agmt. App. § 1.2.2.) Plaintiff was not permitted to alter the Terminal Charts in any manner. ( Id. § 1.2.2.2.) Plaintiff was responsible for the design and development of the “System” (the definition of which will be discussed later) and was required to install the most current worldwide database of Defendant's Terminal Charts onto every “System” prior to its delivery to the customer. ( Id. §§ 1.1.1 & 1.3.1.)

Defendant provided Plaintiff with the JIT for use with several different iRex models and Plaintiff began selling the devices in July 2009.³ (ECF No. 164 ¶ 67.) The iRex device was not widely available in the retail market so Plaintiff would purchase the device, load its software, and sell the combined hardware and software to the consumer. ( Id.) Plaintiff received excellent feedback from its customers and high praise in the aviation industry. ( Id. ¶ 70.)

In January 2010, Apple announced the soon-to-be released iPad. ( Id. ¶ 71.) The iPad does not employ e-ink technology; rather, it features an LED-backlit color display. (ECF No. 128 ¶ 123.) The iPad can be used to view and read e-books, but it also has the capacity to browse the web, play games, send e-mail, watch videos, listen to music, and take photographs. ( Id. ¶ 122.) Because of its functionality, the iPad is typically referred to as a tablet computer. ( Id. ¶ 124.)

Shortly after the iPad was announced, Plaintiff registered with Apple as a developer for apps on the iPad. (ECF No. 164 ¶ 72.) In January 2010, Plaintiff requested the JIT from Defendant so that Plaintiff could develop an app for the iPad. ( Id. ¶ 73.) Plaintiff proposed the development of a “software only” solution for the iPad that would not involve pre-loading Defendant's Terminal Charts prior to the purchase of the iPad. (ECF No. 128 ¶ 139.) At that time, Defendant's representative indicated that they believed such “software only” solution would fall within the ambit of the December 31, 2009 Agreement. ( Id. ¶ 140; ECF No. 164 ¶ 74.)

Despite this understanding, Defendant refused to provide Plaintiff the JIT necessary to develop an iPad app because it was determining its own strategy for the iPad. (ECF No. 164 ¶ 75.) Between February and May 2010, Plaintiff repeatedly informed Defendant that it was moving forward with plans to develop an iPad app that would display Defendant's Terminal Charts. (ECF No. 128 ¶¶ 147–51.) Defendant did not inform Plaintiff that it had changed its position on the scope of coverage of the Agreement, and that it was now taking the position that the iPad app did not fall within the ambit of the Agreement. (ECF No. 164 ¶ 79.)

On May 26, 2010, Defendant informed Plaintiff that it would not allow others, including Plaintiff, to have the JIT for the iPad. ( Id. ¶ 81.) Defendant announced its own iPad app on May 27, 2010. ( Id. ¶ 82.) In July 2010, Defendant launched its “Mobile TC” app in the Apple Store for the iPad. (ECF No. 128 ¶ 172.) Mobile TC is available for free download and, to use the app, a purchaser must have a corresponding subscription to Defendant's Terminal Charts. ( Id. ¶¶ 173–74.) In February 2011, Defendant released a second iPad app—Jeppesen Mobile FD—which includes en route charts and other features in addition to the capabilities included in the Mobile TC app. ( Id. ¶ 179.) The Jeppesen Mobile FD app is also offered to subscribers for free in the Apple store. ( Id. ¶ 180.)

Defendant does not attribute any revenue to its apps and has no plans to begin charging for their download. ( Id. ¶¶ 173, 180–81.) The subscription...