Opinion
CIVIL ACTION No. 02-2195-KHV.
July 8, 2003
MEMORANDUM AND ORDER
MomsWIN, LLC and Ariana Reed-Hagar bring state and federal claims against Joey Lutes, Virtual Wow, Inc. and Todd Gordanier, arising from the creation and development of plaintiffs' web site. Specifically, plaintiffs bring claims under the Kansas Uniform Trade Secrets Act ("KUTSA"), K.S.A. § 60-3320 et seq., the Copyright Act of 1976, 17 U.S.C. § 101 et seq., and the Lanham Act, 15 U.S.C. § 1125(a). This matter comes before the Court on Plaintiffs' Motion For Summary Judgment (Doc. #94) filed May 2, 2003, and Plaintiff's [sic] Motion To Strike Defendants' Reply In Opposition To Plaintiffs' Motion For Summary Judgment And Suggestions In Support (Doc. #116) filed June 20, 2002. For reasons stated below, the Court sustains plaintiffs' motion to strike defendants' reply and overrules plaintiffs' motion for summary judgment.
Plaintiffs' Motion To Strike Defendants' Surreply
On May 2, 2003, plaintiffs filed a motion for summary judgment.Plaintiffs' Motion For Summary Judgment (Doc. #94). Defendants sought and received an extension of time to file their response, see Order (Doc. #106) filed May 27, 2003, and they timely responded on May 28, 2003. See Defendants' Response to Plaintiffs' Motion For Summary Judgment ("Defendants' Response") (Doc. #108). Plaintiffs timely filed their reply, which argued that the Court should not consider defendants' response because it did not comply with D. Kan. Rule 56.1 and that even if the Court did consider defendants' response, the Court should grant summary judgment because no genuine issues of material fact existed.Reply In Support Of Plaintiffs' Motion For Summary Judgment (Doc. #111) filed June 5, 2003. Two weeks later, on June 18, 2003, without leave of Court, defendants filed Defendants' Reply In Opposition To Plaintiffs' Motion For Summary Judgment (Doc. #116), which in essence is a surreply.
Under D. Kan. Rule 7.1(b), parties are permitted file a dispositive motion, a response and a reply. Surreplies are typically not allowed. See Metzger v. City of Leawood, 144 F. Supp.2d 1225, 1266 (Kan. 2001). Surreplies are permitted in rare cases, but not without leave of court.Humphries v. Williams Natural Gas Co., Case No. 96-4196-SAC, 1998 WL 982903, at *1 (Kan. Sept. 23, 1998). Defendants have offered no excuse or justification for filing the surreply without leave. The Court therefore sustains plaintiffs' motion to strike defendants' surreply, and the Court will disregard defendants' surreply in analyzing plaintiffs' motion for summary judgment.
Plaintiffs' Summary Judgment Motion
I. Legal Standard
Summary judgment is appropriate if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. Fed.R.Civ.P. 56(c); accord Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986); Vitus v. Beatrice Co., 11 F.3d 1535, 1538-39 (10th Cir. 1993). A factual dispute is "material" only if it "might affect the outcome of the suit under the governing law." Anderson, 477 U.S. at 248. A "genuine" factual dispute requires more than a mere scintilla of evidence. Id. at 252.
The moving party bears the initial burden of showing the absence of any genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Hicks v. City of Watonga. Okla., 942 F.2d 737, 743 (10th Cir. 1991). Once the moving party meets its burden, the burden shifts to the non-moving party to demonstrate that genuine issues remain for trial "as to those dispositive matters for which it carries the burden of proof." Applied Genetics Int'l, Inc. v. First Affiliated Secs., Inc., 912 F.2d 1238, 1241 (10th Cir. 1990); see also Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986); Bacchus Indus., Inc. v. Arvin Indus., Inc., 939 F.2d 887, 891 (10th Cir. 1991). The non-moving party may not rest on her pleadings but must set forth specific facts. Applied Genetics, 912 F.2d at 1241.
The Court must view the record in a light most favorable to the party opposing summary judgment. See Deepwater Invs., Ltd. v. Jackson Hole Ski Corp., 938 F.2d 1105, 1110 (10th Cir. 1991). Summary judgment may be granted if the non-moving party's evidence is merely colorable or is not significantly probative. See Anderson, 477 U.S. at 250-51. "In a response to a motion for summary judgment, a party cannot rely on ignorance of facts, on speculation, or on suspicion, and may not escape summary judgment in the mere hope that something will turn up at trial." Conaway v. Smith, 853 F.2d 789, 794 (10th Cir. 1988). Essentially, the inquiry is "whether the evidence presents a sufficient disagreement to require submission to the jury or whether it is so one-sided that one party must prevail as a matter of law." Anderson, 477 U.S. at 251-52.
II. Factual Background
In their response to plaintiffs' motion for summary judgement, defendants do not comply with D. Kan. Rule 56.1(b). Specifically, defendants do not (1) begin their brief with a section that contains a concise statement of material facts as to which they contend a genuine issue exists, (2) list disputed facts in numbered paragraphs, (3) refer with particularity to those portions of the record on which they rely, (4) dispute any of plaintiffs' numbered facts, or (5) set forth any additional facts in separately numbered paragraphs, supported by references to the record. D. Kan. Rule 56.1(b)(1)-(2). Defendants cite the record only three times in their response, and they do not attach portions of the record on which they rely. The following facts are therefore either undisputed or deemed admitted. D. Kan. Rule 56.1(a).
In November of 2001, plaintiff Ariana Reed-Hager contacted defendant Joey Lutes, who was doing business as Virtual Wow, about developing and hosting a web site for co-plaintiff MomsWIN. On January 5, 2002, Lutes entered into an oral agreement with Reed-Hager to develop and host the MomsWIN web site. Reed-Hager also wanted Virtual Wow to also develop and host a web site for Family1st, and Lutes agreed to do so at no additional cost. Shortly thereafter, Lutes retained Todd Gordanier, a software programmer and independent contractor, to work with Reed-Hager and develop the PHP source code (computer language) for the MomsWIN web site.
On April 5, 2002, Lutes filed incorporation documents for Virtual Wow, Incorporated ("Virtual Wow") in the office of the Missouri Secretary of State. Before that date Lutes held himself out as the proprietor of Virtual Wow and conducted a business involving the development and hosting of web sites under that name.
Gordanier was an independent contractor, not an employee.
Reed-Hager dictated the visual look and layout of the MomsWIN web site. She also provided textual material, content and information concerning the development project requirements — such as marketing strategies, recruiting tactics, market research, development innovations and website management systems — for both web sites. Defendants did not contribute design elements, textual material or content, and Lutes did not contribute anything to the visual look or layout for the web site. Gordanier's sole contribution to both web sites was to translate information that Reed-Hager supplied into source code in PHP computer language that would be readable over the internet. Reed-Hager and Gordanier intended that their respective contributions would merge into a unitary inseparable whole in the MomsWIN web site source code.
Reed-Hager told defendants that her information was proprietary trade secret information which belonged solely to her and that they could not relay the information to third parties without her consent. Defendants agreed not to reproduce or distribute the MomsWIN web site, in whole or in part, without her express consent. Without that consent, defendants later entered into negotiations with third parties to reproduce and distribute the MomsWIN web site. Moreover, Gordanier applied for copyrights in the MomsWIN and Family 1st web sites, claiming that he is the sole author of both web sites. His copyright applications resulted in registrations TX 5-535-312 and TX 5-524-687, respectively.
Lutes originally agreed to develop the MomsWIN and Family1st web sites for $4,000. Lutes demanded more money, however, and plaintiffs eventually paid $8,500 for both web sites. On March 1, 2002, Lutes demanded additional money and threatened to stop hosting the MomsWIN web site on April 1, 2002 if plaintiffs did not pay. On March 13, 2002, in an instant message conversation between Gordanier and Reed-Hager, Gordanier informed Reed-Hager that he was "sending in the copyright of scripts tomorrow" and he threatened to sue plaintiffs "to forcibly remove scripts if needed." See Exhibit E to Plaintiffs' Memorandum (Doc. #96).
Lutes testified that Reed-Hager offered to pay $4,000 for defendants to create the web site and $4,000 a year for them to host it, and that he accepted those terms. Lutes Deposition at 100-100, Exhibit D to Suggestions In Support Of Plaintiffs' Motion For Summary Judgment (Doc. #96).
Defendants received three checks from Reed-Hager for web site development: one dated January 7, 2002 for $2,000, one dated January 15, 2002 for $4,000, and one dated February 21, 2002 for $2,500, for a total of $8,500. Lutes Deposition at 102-03.
The instant message conversation has only Gordanier's statements, so the Court cannot determine the exact context of his comments.
Lutes removed the MomsWIN web site from his servers on April 1, 2002 and it has not been functional or accessible since that date. On April 26, 2002, Lutes told plaintiffs that he would "hack into" their new web site and disable it if they did not meet his demands for additional payments. On March 29, 2002, MomsWIN, LLC ("MomsWIN") was organized as a Kansas limited liability company. Reed-Hager, who manages MomsWIN, assigned to it all of her rights, title and interest in and to any claims she may have against defendants.
The record does not indicate the function of Moms WIN, LLC or who organized it.
Plaintiffs filed suit on April 29, 2002, advancing four claims. Count I alleges that plaintiffs are entitled to a declaration (a) that MomsWIN and Gordanier are joint authors of the copyright in and to the MomsWIN web site PHP source code, (b) that MomsWIN is the sole author of the MomsWIN web site layout and textual material, (c) that plaintiffs are the sole owners of the confidential, proprietary and trade secret information which they provided to defendants during the development of the MomsWIN web site, and (d) that under the parties' agreement and the KUTSA, defendants cannot disclose that information to third parties. Count II alleges that plaintiffs are entitled to temporary and permanent injunctive relief, enjoining defendants and all who act in concert with them from (a) communicating any trade secret information which belongs to plaintiffs and (b) taking any steps that would compromise the integrity, capability, speed or any other aspect of functionality of their new MomsWIN web site. Count III alleges that plaintiffs are entitled to (a) all revenue from the reproduction, distribution, sale, license or display of the MomsWIN web site PHP source code and (b) a clean, uncorrupted and reproducible copy of that source code. Count IV alleges that defendants breached their agreement with plaintiffs. Pretrial Order (Doc. #97) filed May 5, 2003 at 5-6. On April 30, 2002, plaintiffs amended their complaint to add Count V, which alleges that defendants injured plaintiffs and violated the Lanham Act, 15 U.S.C. § 1125(a), by falsely designating themselves as creators of the MomsWIN web site. Id. at 6.
Plaintiffs seek summary judgment on Counts I-IV, see Suggestions In Support Of Plaintiffs' Motion For Summary Judgment (Doc. #96) filed May 2, 2003 at 1, but the suggestions in support of their motion for summary judgment address only Counts I and IV. See Plaintiffs' Memorandum (Doc. #96). Specifically, plaintiffs argue that as a matter of law (1) they are entitled declaratory judgment that MomsWIN and Gordanier are joint authors of the copyright in and to the MomsWIN web site source code, that MomsWIN is the sole author of the MomsWIN web site layout and textual material, and that MomsWIN is the sole owners of the confidential, proprietary and trade secret information which Reed-Hager provided to defendants during the development of the MomsWIN web site; (2) defendants violated the KUTSA; and (3) defendants breached the parties' agreement. Plaintiffs do not address Counts II or III, and the Court will not sift through the record to construct summary judgment arguments for them. See Schunk v. United Fin. Mortg. Corp., No. 00-2137-KHV, 2001 WL 474299, at *4 n. 12 (Kan. April 11, 2002) (citing Scott v. Hem, 216 F.3d 897, 910 n. 7 (10th Cir. 2000)).
On Count II, plaintiffs argue that they are entitled "summary judgment in their favor on [Count II] . . . of the amended complaint, with damages to be determined at trial," Plaintiffs' Suggestions (Doc. #96) at 14, but Count II does not seek damages and plaintiffs do not address why they think they are entitled to the temporary and permanent injunctive relief which Count II seeks.
Defendants argue that plaintiffs are not entitled summary judgment because the record contains genuine issues of material fact whether plaintiffs are joint source code authors, whether defendants disclosed trade secrets and whether defendants breached their contract with plaintiffs.
III. Analysis
A. Count I — Declaratory Judgment
As noted, Count I alleges that plaintiffs are entitled a declaration (a) that MomsWIN and Gordanier are joint authors of the copyright in and to the MomsWIN web site PHP source code, (b) that MomsWIN is the sole author of the MomsWIN web site layout and textual material, (c) that plaintiffs are the sole owners of the confidential, proprietary and trade secret information which they provided to defendants during the development of the MomsWIN web site, and (d) that under the parties' agreement and the KUTSA, defendants cannot disclose that information to third parties. Plaintiffs seek summary judgment on all of these claims. Defendants argue that genuine issues of material fact exist because (1) plaintiffs have not established that they have a copyrightable interest in the web site source code, (2) the evidence does not establish that the translation of Reed-Hager's information into source code was rote and mechanical, (3) plaintiffs have not identified what information is trade secret, and (4) information posted on the internet cannot be trade secret.
1. Source Code
As noted, plaintiffs claim that they are entitled to summary judgment declaring that MomsWIN and Gordanier are joint authors of the MomsWIN source code. Plaintiffs cite undisputed evidence that Gordanier and Reed-Hager each contributed to development of the web site and that each intended their contributions to merge into a unitary inseparable source code. Plaintiffs specifically note that Reed-Hager contributed the look, layout, textual material, project requirements and content, and that Gordanier translated those elements into source code.
This argument is somewhat confusing because Count I asks the Court to declare that plaintiff and Gordanier are co-authors, but the brief in support of plaintiffs' summary judgment motion seems to insist that MomsWIN is the sole author and that Gordanier is not an author for copyright purposes because he merely fixed the ideas of Reed-Hager through rote or mechanical transcription.
Authors of a joint work are co-owners of any copyright in the work. 17 U.S.C. § 201(a). A "joint work" is a work prepared by two or more authors with the intent that their contributions be merged into inseparable or interdependent parts of a unitary whole. 17 U.S.C. § 101 Based on the undisputed facts, that requirement is apparently satisfied in this case. Joint authorship also requires, however, that the respective contributions of each joint author be independently copyrightable and that the co-authors intended, when the work was created, to regard themselves as co-authors. Erickson v. Trinity Theatre, Inc., 13 F.3d 1061 (7th Cir. 1994); Childress v. Taylor, 945 F.2d 500 (2d Cir. 1991); Ashton-Tate Corp. v. Ross, 916 F.2d 516 (9th Cir. 1990). Defendants argue that MomsWIN is not a co-author of the source code because Reed-Hager did not contribute a copyrightable interest — she merely described, directed or suggested the parameters of a commissioned work.
An author is a person to whom the work owes its origin and who has superintended the whole work, "the master mind." Burrow-Giles Lithographic Co. v. Sarony, 111 U.S. 53, 58 (1883).
To qualify for copyright protection, a work must be original to the author. 17 U.S.C. § 102(a); see also Harper Row, Publishers, Inc. v. Nation Enter., 471 U.S. 539, 547-49 (1985);Burrow-Giles Lithographic Co. v. Sarony, 111 U.S. 53 (1884).
The record indicates that while Reed-Hager dictated the visual look and layout of the web sites and provided the textual material, content and information concerning the development project requirements, Gordanier wrote the source code which enabled the information to be posted and read on the web sites. The record does not establish as a matter of law that Reed-Hager's contribution was independently copyrightable, i.e. that the material she provided was original and fixed in a tangible medium of expression. See 17 U.S.C. § 101; Erickson, 13 F.3d at 1070-71;Childress, 945 F.2d at 506-07; Ashton-Tate, 916 F.2d 520-21. Further, the parties dispute and the record does not conclusively establish that the process of transforming plaintiffs' content to source code involved merely rote or mechanical transcription so that Gordanier is not an author at all. See Andrien v. S. Ocean County Chamber of Commerce, 927 F.2d 132, 135 (3d Cir. 1991).
The matter is further confounded because plaintiffs do not seek a declaration that MomsWIN and Gordanier are joint authors of the MomsWIN web site: they seek a declaration that they are joint owners of the MomsWIN web site "source code." The American Heritage Dictionary of the English Language (4th ed. 2000) defines "source code" as "[c]ode written by a programmer in a high-level language and readable by people but not computers. Source code must be converted to object code or machine language before a computer can read or execute the program." The record does not define "source code," however, or establish what plaintiffs contributed to the source code or how either side "authored" the source code.
Plaintiffs argue that the Court should not consider defendants' arguments because defendants' response does not conform to the local rules. Reply In Support Of Plaintiffs' Motion For Summary Judgment (Doc. #111) filed June 5, 2003. Even if the Court did not consider defendants' response, it could not grant summary judgment without making Fed.R.Civ.P. 56(c) determinations. See Reed v. Bennett, 2002 WL 31732484, at *3 (10th Cir. Dec. 6, 2002) (summary judgment is not proper merely because nonmovant failed to file response). The moving parties bear the initial burden of demonstrating that no genuine issue of material fact exists and that they are entitled to summary judgment as a matter of law. See Celotex, 477 U.S. 317. The burden shifts to the nonmoving parties only if the summary judgment motion is properly supported. Adickes v. S.H. Kress Co., 398 U.S. 144, 160-61 (1970) (cited in Reed, 2002 WL 31732484, at *3). The Court must "first examin[e] the moving party's submission to determine if it has met its initial burden of demonstrating that no material issues of fact remain for trial and [that] the moving party is entitled to judgment as a matter of law."Reed, 2002 WL 31732484, at *3. Because plaintiffs have not met that burden, the Court overrules their motion as to this issue.
2. Web Site Layout And Textual Material
As noted, plaintiffs claim that they are entitled to summary judgment declaring that MomsWIN is the sole author of the layout and textual material for the MomsWIN web site. Defendants argue that plaintiffs' contributions of textual material, content and information concerning the development project requirements are not independently copyrightable. For reasons stated above, genuine issues of material fact exist whether plaintiffs "authored" the web sites' layout and textual material. The Court therefore overrules plaintiffs' motion as to this issue.
3. Trade Secrets
As noted, plaintiffs claim that they are entitled to summary judgment declaring that they are sole owners of the confidential, proprietary and trade secret information which they provided to defendants for development of the web site, and that under the parties' agreement and the KUTSA, defendants cannot legally communicate that information to third parties. Defendants disagree, arguing that plaintiffs have not identified what information is allegedly trade secret, and that under Kansas law the existence of a trade secret is a question of fact.
Although Count I seeks a declaratory judgment that plaintiffs are sole owners of confidential, proprietary and trade secret information which they provided to defendants, plaintiffs focus exclusively on trade secrets and do not argue that the information was confidential or proprietary. The Court therefore denies plaintiffs' summary judgment motion as to confidential and proprietary information.
The threshold question is whether trade secret information existed. All West Pet Supply Co. v. Hill's Pet Prod. Div., 840 F. Supp. 1433, 1437 (Kan. 1993). The existence of a trade secret under the KUTSA is generally a question of fact for determination by the trier of fact. Id. The KUTSA defines a trade secret as
information, including a formula, pattern, compilation, program, device, method, technique, or process, that:
(i) derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and
(ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.
K.S.A. § 60-3320(4). Plaintiffs bear the burden of producing some evidence that the information which they provided to defendants meets the definition of a trade secret. Trandes Corp. v. Guy F. Atkinson Co., 996 F.2d 655, 661 (4th Cir. 1993); qad inc. v. ALN Assocs., Inc., 1990 WL 106540, at *2 (N.D. Ill. 1990) (plaintiffs cannot "simply persist in the blunderbuss statement that `Everything you got from us was a trade secret.'"). Plaintiffs must describe the subject matter of their alleged trade secrets in sufficient detail to establish each element of a trade secret. See BioCore, Inc. v. Khosrowshahi, 96 F. Supp.2d 1221, 1229 (Kan. 2000); Utah Med. Prods., Inc. v. Clinical Innovations Assocs., Inc. 79 F. Supp.2d 1290, 1312-13 (Utah 1999); Pulsecard, Inc. v. Discover Card Servs., Inc., 1996 WL 137819, at *3 (Kan. Mar. 5,1996); AMP, Inc. v. Fleischhacker, 823 F.2d 1199, 1203 (7th Cir. 1987) (failure to identify specific trade secrets precludes injunctive relief against threatened disclosure); Julie Research Lab., Inc. v. Select Photographic Eng'g Inc., 810 F. Supp. 513, 519 (S.D.N.Y. 1992) (plaintiff bears burden of identifying trade secrets in detail); qad, inc., 1990 WL 106540, at *2 (dismissal on account of persistent failure to identify trade secrets). Although plaintiffs are not required to disclose all of their trade secrets, they must do more than merely allege that they had trade secrets. Trandes, 996 F.2d at 661; Utah Med. Prods., 79 F. Supp.2d at 1312-13.
Here, plaintiffs have generally established that Reed-Hager gave defendants textual material, content and information concerning project development requirements. Plaintiffs claim that this information was trade secret, but they cite no evidence that it satisfies that statutory definition of a trade secret. Furthermore, as defendants point out, textual material on an internet web site confronts an uphill battle in qualifying as a trade secret. The record does not conclusively establish that the information which plaintiffs provided to defendants was not generally known, that plaintiffs derived independent economic value from it, that it was not readily ascertainable by proper means, or that plaintiffs made reasonable efforts under the circumstances to maintain the secrecy of their alleged trade secrets. The Court therefore overrules plaintiffs' motion for summary judgment on this issue.
In their reply, plaintiffs claim that their trade secrets are not available to the public because plaintiffs carefully screen those privy to this information on the web site. Reply In Support Of Plaintiffs' Motion For Summary Judgment (Doc. #111). Plaintiffs do not describe what information is not available to the public, however, and they do not refer with particularity to the record. See D. Kan. Rule 56.1. The Court therefore cannot consider plaintiffs' evidence for purposes of this motion.
B. Count IV — Breach Of Agreement
Plaintiffs seek summary judgment on Count IV, which asserts that defendants breached their agreement by (1) demanding more than $4,000 for web site development, (2) threatening to stop hosting the MomsWIN web site on April 1, 2002, (3) pulling the MomsWIN web site on April 1, 2002, and (4) entering into negotiations with third parties to reproduce and distribute the MomsWIN web site without plaintiffs' consent. Defendants claim that the parties modified the original oral agreement throughout their relationship, but they cite no record support for this assertion and the Court will not consider it.
Under Kansas law, the essential elements of an action for breach of contract are (1) the existence of a contract between the parties; (2) sufficient consideration to support the contract; (3) plaintiffs' performance or willingness to perform in compliance with the contract; (4) defendants' breach of the contract; and (5) damages to plaintiffs caused by the breach. Lindsey Masonry Co. v. Danis Envtl Ind., Inc., 2003 WL 1697725, at *6 (Kan. Mar. 26, 2003) (citing Commercial Credit Corp. v. Harris, 212 Kan. 310, 313, 510 P.2d 1322, 1325 (1973)).
As noted, plaintiffs entered into an oral agreement in which defendants agreed to develop and host two web sites for $4,000 and not to reproduce or distribute the MomsWIN web site without plaintiffs' express consent. This undisputed evidence establishes the existence of a contract and consideration. Plaintiffs' performance or willingness to perform in compliance with the contract is apparently not an issue on this record, as plaintiffs paid the $4,000 and more. Plaintiffs claim they are entitled to summary judgment on the fourth element (breach of contract) and ask that damages be determined at trial. Suggestions In Support Of Plaintiffs' Motion For Summary Judgment (Doc. #96) at 16. Defendants respond that plaintiffs have not disclosed all contract terms or oral modifications to the contract, and that genuine issues of material fact preclude summary judgment. Defendants' Response To Plaintiffs' Motion For Summary Judgment (Doc. #108) at 4. Defendants do not allege additional facts or support their assertion with citations to the record, see D. Kan. Rule 56.1, but their position is nonetheless correct.
A breach of contract is a material failure of performance of a duty arising under or imposed by agreement. Tamarac Dev. Co., Inc. v. Delamater, Freund Assoc., P.A., 234 Kan. 618,619, 675 P.2d 361 (1984). Plaintiffs first claim that by demanding additional payments, defendants breached their oral agreement to develop the web sites for $4,000. This allegation is confusing because plaintiffs apparently acquiesced in these demands by making additional payments — thus suggesting that the parties modified the oral agreement. The record does not reveal why defendants demanded or plaintiffs made the extra payments, and the Court cannot conclude as a matter of law that defendants' demands for additional payments constituted a material failure of performance. See Lutes Deposition at 103-104, Exhibit D toSuggestions In Support Of Plaintiffs' Motion For Summary Judgment (Doc. #96).
Plaintiffs next claim that defendants breached the oral agreement by threatening to stop hosting the MomsWIN web site on April 1, 2002. Defendants apparently agreed to host the MomsWIN web site for $4,000 a year, Lutes Deposition at 100-100, Exhibit D to Suggestions In Support Of Plaintiffs' Motion For Summary Judgment (Doc. #96), but the parties have not discussed this portion of the contract and the record does not establish that plaintiffs paid the annual hosting fee. The agreement to host the web site a appears to be the basis for plaintiffs' argument that defendants breached the contract by pulling the MomsWIN web site on April 1, 2002, but they similarly have not established that a mere threat to pull the web site constituted an actionable breach of contract.
Plaintiffs further claim that defendants breached their agreement by pulling the MomsWIN web site on April 1, 2002. As noted, the record does not conclusively establish the terms of the parties' agreement with regard to web site hosting, or plaintiffs' performance of their obligations in that regard. The Court therefore cannot determine as a matter of law that defendants' conduct constituted a material breach.
Finally, plaintiffs seek summary judgment on their claim that by entering into negotiations with third parties to reproduce and distribute the MomsWIN web site, defendants breached their agreement not to reproduce or distribute the MomsWIN web site, in whole or in part, without plaintiffs' express consent. The record, however, does not indicate that defendants have reproduced or distributed plaintiffs' web site. Plaintiffs make no such argument, and they do not explain how defendants breached the agreement by merely negotiating with third parties. Because genuine issues of material fact exist whether defendants breached the agreement, the Court overrules plaintiffs' motion on this issue.
IT IS THEREFORE ORDERED that Plaintiffs' Motion For Summary Judgment (Doc. #94) filed May 2, 2003 be and hereby is OVERRULED. IT IS FURTHER ORDERED that Plaintiff's [sic] Motion To Strike Defendants' Reply In Opposition to Plaintiffs' Motion For Summary Judgment And Suggestions In Support (Doc. #116) filed June 20, 2002 be and hereby is SUSTAINED.