Opinion
No. FSTCV10-6004365
May 17, 2011
Memorandum of Decision on Motion for Summary Judgment (No. 115)
Factual Background
The plaintiffs in this matter, Osho International Foundation (Foundation) and American Multi Media Corporation (American Multi Media), have brought suit against the defendant, Brian O'Neill. In the operative pleading, which is the amended complaint dated May 20, 2010, the plaintiffs allege the following facts relevant to the disposition of the motion for summary judgment that is presently before the court. The Foundation, a foreign nonprofit organization formed under the laws of Switzerland, was founded "to hold assets and perpetuate the teachings of Osho, a/k/a Bhagwan Shree Rajneesh, a mystic and spiritual teacher who garnered an international following before his death in 1990." American Multi Media is an Arizona corporation that is owned or controlled by the Foundation. On May 7, 2001, American Multi Media entered into a written lease agreement with Sovran Acquisition, LP, d/b/a Uncle Bob's Self Storage (Uncle Bob's) for the use of a self-service storage facility located at 280 Fairfield Avenue in Stamford. The plaintiff's stored various pieces of property in this storage unit, including, inter alia: (1) eight boxes of older audio-visual equipment such as a Betacam recorder, DAT audio player, a tape cassette, audio spool players and a UMATIC video player/recorder; (2) business, tax and/or medical records regarding American Multi Media and its employees; (3) unpublished original works of art and (4) "creative writings and recordings and other proprietary materials subject to international copyright laws and private and confidential information . . . regarding the Foundation, its founder and employees . . ." In all, the plaintiffs' property was stored in ninety-six boxes at the Uncle Bob's storage facility.
The plaintiffs will be referred to separately when necessary and at other times collectively as "the plaintiffs."
Pursuant to their agreement, American Multi Media paid Uncle Bob's a monthly fee in order to store its property. In 2008, Uncle Bob's ceased sending monthly bills to American Multi Media's office in New York City. Nevertheless, American Multi Media continued to pay its rental fee in a timely fashion. In August 2009, American Multi Media relocated its business to another address in New York City and it neglected to inform Uncle Bob's of this location change. Additionally, the American Express credit card to which these storage fees were charged expired. American Multi Media renewed this credit card but it failed to tell Uncle Bob's the card's new expiration date. As a result, American Multi Media did not pay Uncle Bob's any rent between September and December 2009. Accordingly, on December 14, 2009, Uncle Bob's held a public auction in which it sold all of the plaintiffs' property to the defendant for $10. Upon learning of this sale in February 2010, the plaintiffs attempted to buy the items back from the defendant for a far greater sum than the defendant paid, but the defendant has refused to sell this property to the plaintiffs. In the meantime, the defendant has attempted to sell the property on the open market. The plaintiffs contend that some of the property formerly housed at Uncle Bob's has been registered for copyright protection with the U.S. Copyright Office and is protected under international copyright treaties and conventions, including, but not limited to, the Berne Convention. Furthermore, the plaintiffs allege that most of the creative content has been held in confidence and has never been published, distributed or sold to the general public. As a result, the plaintiffs' three-count amended complaint alleges claims for: (1) injunctive relief; (2) misappropriation of trade secrets and (3) unjust enrichment.
By memorandum of decision dated September 8, 2010, the court, Brazzel-Massaro, J., granted a temporary injunction in favor of the plaintiffs in which it ordered that "the property purchased by the defendant . . . from . . . Uncle's Bob's Storage on or about December 14, 2009, shall not be sold, disseminated, transferred, published or altered or used in any manner by the defendant or any other party until final judgment is entered in this matter."
On November 17, 2010, the defendant filed a motion for summary judgment and a supporting memorandum of law. The defendant's motion attaches only an unsigned, unsworn copy of a document otherwise purporting to be the "affidavit" of the defendant Brian O'Neill. In response, on January 5, 2011, the plaintiff's filed a memorandum of law in opposition to the defendant's motion. Attached to the plaintiffs' memorandum of law in opposition are: (1) the signed and notarized affidavit of Klaus Steeg, who is the Foundation and American Multi Media's director; (2) a copy of Judge Brazzel-Massaro's September 8, 2010 memorandum of decision regarding the plaintiffs' application for a temporary injunction in this case and (3) a signed notarized affidavit, with attachments, from Attorney Mary Luria, who is the Foundation's copyright and trademark attorney. The parties appeared before the court and argued this matter at short calendar on January 31, 2011.
DISCUSSION
"Practice Book § 17-49 provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. In deciding a motion for summary judgment the trial court must view the evidence in the light most favorable to the nonmoving party." (Internal quotation marks omitted.) Provencher v. Enfield, 284 Conn. 772, 790-91, 936 A.2d 625 (2007). "[S]ummary judgment is appropriate only if a fair and reasonable person could conclude only one way . . . [A] summary disposition . . . should be on evidence which a jury would not be at liberty to disbelieve and which would require a directed verdict for the moving party." (Citations omitted; internal quotation marks omitted.) Dugan v. Mobile Medical Testing Services, Inc., 265 Conn. 791, 815, 830 A.2d 752 (2003). The burden is on the moving party to demonstrate an absence of any triable issue of material fact and "[t]o satisfy his burden the movant must make a showing that it is quite clear what the truth is, and that excludes any real doubt as to the existence of any genuine issue of material fact . . . Once the moving party has met its burden, however, the opposing party must present evidence that demonstrates the existence of some disputed factual issue . . . It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue. Mere assertions of fact . . . are insufficient to establish the existence of a material fact and, therefore, cannot refute evidence properly presented to the court under Practice Book § [17-45]." (Internal quotation marks omitted.) Zielinski v. Kotsoris, 279 Conn. 312, 318-19, 901 A.2d 1207 (2006). "As the party moving for summary judgment, the [movant] is required to support its motion with supporting documentation, including affidavits." Heyman Associates No. 1 v. Ins. Co. of Pennsylvania, 231 Conn. 756, 796, 653 A.2d 122 (1995).
As a threshold issue, the court must first determine the admissibility of the defendant's unsigned and unsworn "affidavit" offered in support of his summary judgment motion. In their memorandum of law in opposition, the plaintiffs argue that this document would be inadmissible evidence if this case were to proceed to trial, and, as a result, the defendant cannot rely on it to support his motion for summary judgment. The plaintiffs further argue that since this purported affidavit is the only evidence offered by the defendant that the summary judgment motion should summarily be denied.
Under Connecticut law, "[o]nly evidence that would be admissible at trial may be used to support or oppose a motion for summary judgment, and the applicable provisions of our rules of practice contemplate that supporting [or opposing] documents . . . be made under oath or be otherwise reliable." (Internal quotation marks omitted.) Rockwell v. Quintner, 96 Conn.App. 221, 233-34 n. 10, 899 A.2d 738, cert. denied, 280 Conn. 917, 908 A.2d 538 (2006). "An affidavit is defined as [a] voluntary declaration of facts written down and sworn to by the declarant before an officer authorized to administer oaths . . . [U]nsworn statements . . . do not fit this definition . . . [When] witness statements [are] not sworn to before an officer authorized to administer oaths, they [do] not meet the requirements of an affidavit . . ." (Citation omitted; internal quotation marks omitted.) Krassner v. Ansonia, 100 Conn.App. 203, 209-10, 917 A.2d 70 (2007). Unsigned and unsworn affidavits have "no evidentiary value"; Viola v. O'Dell, 108 Conn.App. 760, 768, 950 A.2d 539 (2008); and they cannot be relied on in support of a motion for summary judgment. Fogarty v. Rashaw, 193 Conn. 442, 444, 476 A.2d 582 (1984). As the document purporting to be an affidavit that is offered by the defendant is unsigned and not acknowledged by a Commissioner of the Superior Court or other officer, the court shall not consider it as evidence when ruling on this motion. Accordingly, in order to succeed on his motion for summary judgment, the defendant must demonstrate that there is no genuine issue of material fact that he is entitled to judgment as a matter of law, without the benefit of any supporting evidence.
I
The Self-Service Storage Act
The defendant first moves for summary judgment on the ground that he has taken the subject property free of any rights of the plaintiffs pursuant to General Statutes § 42-159 et seq. Specifically, the defendant cites to General Statutes § 42-166, which provides: "A purchaser in good faith of personal property sold to satisfy the lien provided for in Section 42-160 takes the property free of any rights of persons against whom the lien was valid, despite noncompliance by the owner with the requirements of this chapter." The defendant contends that according to § 42-166, he took legal title to the plaintiffs' former property by operation of law when he purchased it at the public auction. In response, the plaintiffs offer a somewhat convoluted argument. The plaintiffs contend that according to General Statutes § 42-168, equitable rights of parties are not impaired by § 42-166, and, as a result, the court can still award the plaintiffs an equitable remedy such as unjust enrichment. Moreover, the plaintiff's cite to analogous statutes from other states and argue that the difference in language between § 42-168 and these out of state statutes indicates that Connecticut law would allow them to recover.
Although it is not clear from either the face of the defendant's motion or his supporting memorandum of law, it appears that this argument is directed towards all of the counts found in the plaintiff's amended complaint.
General Statutes § 42-168 provides: "Nothing in this chapter shall impair or affect the right of parties to create liens by special contract or agreement, nor shall it impair or affect other liens arising at common law, in equity or by any other provision of the general statutes, nor shall it impair or affect any other rights affecting debtors and creditors allowed by law."
Section 42-166 is part of a series of statutes that govern self-service storage facilities. There is virtually no case law discussing the scope of this statute. Nevertheless, given the statute's plain language, it would appear that there are two requirements in order for § 42-166 to be applicable. First, the purchaser must have acted in "good faith." Second, the purchaser must have bought the property when it was "sold to satisfy the lien provided for in [General Statutes] § 42-160 . . ." As the defendant has offered no admissible evidence in support of his motion for summary judgment, it is impossible to tell whether he acted in good faith. Moreover, although the self-service storage facility statutes would seemingly apply to this action because the plaintiffs allege that Uncle Bob's is a self-service storage facility and that it sold the plaintiffs' property at auction, it is not entirely clear that the property was sold to satisfy the lien provided for in § 42-160. That statute provides in relevant part: "(a) The owner of a self-service storage facility shall have a lien upon all personal property located at such facility for the amounts of any rent, labor or other valid charges incurred in relation to such personal property, for any valid expenses incurred in the necessary preservation of such personal property and for any expenses reasonably incurred in the sale or other disposition of such personal property pursuant to law. Such lien attaches on the date of default by the occupant. Notwithstanding the provisions of Section 42a-9-333 such lien shall not have priority over a lien or security interest which has attached or been perfected prior to such default." The plaintiffs' amended complaint does not allege that the subject auction occurred because Uncle Bob's had a lien on the plaintiffs' property pursuant to § 42-160. Although it would appear likely that Uncle Bob's did have a lien pursuant to § 42-160, the defendant has presented no evidence affirmatively demonstrating that is the case. The defendant has failed to meet his initial burden to demonstrate that there is no genuine issue of material fact as to applicability of § 42-166 as a defense.
In fact, a Loislaw search revealed that the only case that has even mentioned § 42-166 was Judge Brazzel-Massaro's decision on the temporary injunction in this very case. The legislative history of Public Acts 1981, No. 81-428, in which the legislature passed this statute, was also not particularly illuminating regarding the scope of § 42-166.
Subsections (b) and (c) of § 42-160 only apply if the property in question is an automobile, and, therefore, they are not relevant here.
It should be noted that it is entirely possible that § 42-166 would provide the defendant with a complete defense to this action when the case proceeds to trial, but the defendant has simply failed to meet his initial burden to remove all issues of fact as to the applicability of this statute by showing that it is quite clear what the truth is, and that excludes any real doubt as to the existence of any genuine issue of material fact. Zielinski v. Kotsoris, supra.
II
Unjust Enrichment
Next, the defendant argues that he is entitled to judgment as a matter of law on count three, unjust enrichment, because there is no evidence of a contract between the plaintiffs and the defendant. According to the defendant, the plaintiffs can only succeed on an unjust enrichment claim when there is no remedy available under a contract between the parties. In support of this position, the defendant cites to the holding of the Connecticut Supreme Court in Hartford Whalers Hockey Club v. Uniroyal Goodrich Tire Co., 231 Conn. 276, 649 A.2d 518 (1994). From the Supreme Court's decision in the Hartford Whalers case, the defendant concludes that an unjust enrichment cause of action requires there to be evidence of a contract between the parties. In response, the plaintiffs contend that the defendant misconstrues the law of unjust enrichment. Specifically, the plaintiffs argue that a contractual relationship is not a required element of an unjust enrichment claim. Furthermore, the plaintiffs note that the defendant's argument on this issue has already been addressed, and rejected, by Judge Brazzel-Massaro in her decision granting a temporary injunction. The plaintiff's argue that Judge Brazzel-Massaro's determinations regarding the law of unjust enrichment are law of the case and this fact precludes the court from granting summary judgment in favor of the defendant.
Judge Brazzel-Massaro did in her September 8, 2010 memorandum of decision on plaintiff's application for a temporary injunction (No. 114) reject the argument that unjust enrichment cannot apply absent any evidence of a contractual relationship between the parties. Id., 12. Since that was not a full trial on the merits, however, this court will conduct its own analysis of the argument.
"Unjust enrichment applies wherever justice requires compensation to be given for property or services rendered under a contract, and no remedy is available by an action on the contract . . . A right of recovery under the doctrine of unjust enrichment is essentially equitable, its basis being that in a given situation it is contrary to equity and good conscience for one to retain a benefit which has come to him at the expense of another . . . With no other test than what, under a given set of circumstances, is just or unjust, equitable or inequitable, conscionable or unconscionable, it becomes necessary in any case where the benefit of the doctrine is claimed, to examine the circumstances and the conduct of the parties and apply this standard . . . Unjust enrichment is, consistent with the principles of equity, a broad and flexible remedy . . . Plaintiffs seeking recovery for unjust enrichment must prove (1) that the defendants were benefitted, (2) that the defendants unjustly did not pay the plaintiffs for the benefits, and (3) that the failure of payment was to the plaintiffs' detriment." (Internal quotation marks omitted.) Vertex, Inc. v. Waterbury, 278 Conn. 557, 573, 898 A.2d 178 (2006). Accordingly, a party need not demonstrate a legally enforceable contract in order to succeed on a claim for unjust enrichment. Indeed, a "lack of a remedy under the contract is a precondition for recovery based upon unjust enrichment . . ." (Internal quotation marks omitted.) Bridgeport v. Kasper Group, Inc., 278 Conn. 466, 472 n. 4, 899 A.2d 523 (2006). Contrary to the defendant's argument, in the Hartford Whalers case, the Connecticut Supreme Court did not hold that there must be a contract between the parties in order for a plaintiff to succeed on an unjust enrichment claim. Rather, the Supreme Court stated that "[t]he fact that the plaintiff could not recover under the contract does not bar its recovery under the theory of unjust enrichment . . ." Hartford Whalers Hockey Club v. Uniroyal Goodrich Tire Co., supra, 231 Conn. 284. With such a statement, our Supreme Court did not hold that there must be a contract between the parties.
Furthermore, in Vertex, Inc. v. Waterbury, supra, 278 Conn. 557, the Connecticut Supreme Court ruled that it was error for a trial judge to instruct the jury that the plaintiff had to demonstrate an implied in fact contract between the parties in order for the plaintiff to succeed on a claim for unjust enrichment. When explaining the difference between an implied in fact and an implied in law contract, the Supreme Court stated that "[a]n implied in fact contract is the same as an express contract, except that assent is not expressed in words, but is implied from the conduct of the parties . . . On the other hand, an implied in law contract is not a contract, but an obligation which the law creates out of the circumstances present, even though a party did not assume the obligation . . . It is based on equitable principles to operate whenever justice requires compensation to be made . . . An implied in law contract may arise due to one party being unjustly enriched to the detriment of the other party . . . Accordingly, an implied in law contract is another name for a claim for unjust enrichment." (Citations omitted; internal quotation marks omitted.) Id., 573-74. This quotation makes clear that the plaintiffs do not have to prove that there was an implied in fact contract between themselves and the defendant. Rather, under the law of unjust enrichment, there only has to be an implied in law contract between the parties, which, in reality, is not a contract at all. Consequently, in order to prevail on their unjust enrichment claim, the plaintiffs only need to demonstrate the traditional three elements of this cause of action.
In the present case, the plaintiffs allege that the defendant wrongfully benefitted from receiving their property through the auction and that the plaintiffs have suffered a detriment as a result of the defendant's actions. These allegations are supported by attestations in Steeg's affidavit in that Steeg contends that the defendant obtained the plaintiffs' valuable property for virtually nothing and that he is attempting to sell this property on the open market for a substantial profit. A trier of fact could conceivably determine that this conduct constitutes unjust enrichment on the part of the defendant. As "[d]etermining whether the equitable doctrines of quantum meruit and unjust enrichment are applicable in any case requires a factual examination of the particular circumstances and conduct of the parties"; David M. Somers Associates, P.C. v. Busch, 283 Conn. 396, 407, 927 A.2d 832 (2007). The defendant has therefore failed to meet his burden to demonstrate that he is entitled to judgment as a matter of law on the plaintiffs' unjust enrichment claim.
III
Trade Secrets
Finally, the defendant moves for summary judgment on count two alleging misappropriation of trade secrets. In his memorandum of law, the defendant argues that none of the contents of the storage unit rented by the plaintiffs meet the statutory definition of what constitutes a trade secret. Specifically, the defendant contends that the items in question have nothing to do with a business plan or method. Accordingly, the defendant argues that there is no genuine issue of fact that he is entitled to judgment as a matter of law on this count. In response, the plaintiff's argue that the defendant has failed to meet his initial burden to demonstrate the lack of an issue of fact whether or not the property in question qualifies as trade secrets. The plaintiffs contend furthermore that their supporting documentation is sufficient to raise a question of fact on the issue of whether the subject items are trade secrets, and, as a result, the defendant's motion for summary judgment must fail.
Pursuant to General Statutes § 35-52 and § 35-53, the plaintiff's have the ability to bring claims for injunctive relief and damages for misappropriation of trade secrets. General Statutes § 35-51(d) defines trade secrets as: "information, including a formula, pattern, compilation, program, device, method, technique, process, drawing, cost data or customer list that: (1) 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 (2) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy." "Essentially, according to § 35-51(d), in addition to the two enumerated requirements, to constitute a trade secret, information must be of the kind included in the nonexhaustive list contained in the statute. The first step in [a court's] analysis, therefore, is a determination of whether the information at issue satisfies this threshold requirement." Elm City Cheese Co. v. Federico, 251 Conn. 59, 70, 752 A.2d 1037 (1999). Then, the court must "determine whether that information is of the kind that, assuming the requirements § 35-51(d)(1) and (2) are met, can be considered a trade secret under the trade secrets act." Id., 74. "The question of whether, in a specific case, a party has made reasonable efforts to maintain the secrecy of a purported trade secret is by nature a highly fact-specific inquiry . . . What may be adequate under the peculiar facts of one case might be considered inadequate under the facts of another. According to § 35-51(d)(2), the efforts need only be `reasonable under the circumstances . . .' (Citation omitted.) Id., 80. "Having considered the secrecy requirement of § 35-51(d), [a court] next consider[s] the second requirement of the statute, contained in subdivision (1) — namely, that the information sought to be protected `[d]erives 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 . . .'" Id., 86-87.
As previously noted, the defendant has presented no evidence in support of his summary judgment motion. By submitting no admissible evidence, he has failed to meet his initial burden. Furthermore, the plaintiffs only need to raise an evidentiary predicate of a genuine issue of material fact as to the applicability of § 35-51(d) in order to survive the summary judgment stage. In the present case, the plaintiffs allege that the defendant obtained "confidential business records, tax records, financial information and unpublished manuscripts" when he purchased the plaintiffs' former property at the auction. Specifically, in his affidavit, Steeg attests that the plaintiffs placed "eight boxers of older audio-visual equipment (such as a Beatcam recorder, DAT audio players, a tape cassette, audio spool players, and a UMATIC video player/recorder), as well as boxes containing private and confidential information (including business, tax and/or medical records) regarding the Foundation and [American Multi Media] . . ." at Uncle Bob's. Furthermore, Steeg attests that the subject storage facility housed "boxes containing works of art and other proprietary materials subject to international copyright laws and private confidential information (including business, tax and/or medical records as well as underlying documentation of U.S. copyright registrations) regarding Osho, the Foundation and its employees . . ." Steeg's attestations regarding the copyrights are supported by Luria's affidavit and the attached documentation. Based on those sworn assertions, these materials could conceivably constitute a "compilation" regarding the life and works of Osho.
Moreover, in her affidavit, Luria attests that these items are "not generally known and not readily ascertained by proper means by the Foundation's competitors or the general public, and whose uncontrolled dissemination would harm the reputation and financial stability of the Foundation." It is also arguably apparent that the plaintiffs intended to keep this property secret because they placed it in a storage facility and, as Steeg attests, the plaintiffs "never intended to lose control of the Property." Absent any evidence offered by the defendant to the contrary, these attestations are sufficient to raise a genuine issue of material fact as to the applicability of § 35-51(d) to the present case. As the defendant has failed to meet his burden to demonstrate that the property in question cannot, as a matter of law, constitute a trade secret, and defendant is not entitled to summary judgment as to count two.
It should be noted that the defendant only moved for summary judgment as to count two on the ground that the property in question does not qualify as a trade secret. This is the only ground raised on the defendant's motion and argued in his supporting memorandum of law. Nevertheless, as noted by Judge Brazzel-Massaro in her decision ordering the temporary injunction, in order to succeed on a claim for misappropriation of trade secrets, the plaintiffs must establish actionable misappropriation. Under the law of trade secrets, "misappropriation" means: "(1) Acquisition of a trade secret of another by a person who knows or has reason to know that the trade secret was acquired by improper means; or (2) disclosure or use of a trade secret of another without express or implied consent by a person who (A) used improper means to acquire knowledge of the trade secret; or (B) at the time of disclosure or use, knew or had reason to know that his knowledge of the trade secret was (i) derived from or through a person who had utilized improper means to acquire it; (ii) acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use, including but not limited to disclosures made under Section 1-210, Sections 31-40j to 31-40p, inclusive, or subsection (c) of Section 12-62; or (iii) derived from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use; or (C) before a material change of his position, knew or had reason to know that it was a trade secret and that knowledge of it had been acquired by accident or mistake." General Statutes § 35-51(b). Actionable misrepresentation, however, is not an issue presently before this court as it was not raised in the defendant's summary judgment motion.
CONCLUSION
For all of the reasons stated above, the defendant's motion for summary judgment is denied in its entirety.
SO ORDERED