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Belliveau v. Barco, Inc.

United States District Court, W.D. Texas, Austin Division

June 20, 2019

BARCO, INC., and BARCO, N.V., Defendants.



         BE IT REMEMBERED on this day the Court reviewed the file in the above-styled cause, and specifically Defendants Barco, Inc. and Barco, N.V. (collectively, Barco)'s Motion for Reconsideration [#219], Plaintiff Richard Belliveau's Response [#228] in opposition, and Barco's Reply [#231] in support, as well as Barco's Unopposed Motion for Entry of Judgment Under Rule 54(b) [#241]. Having considered the documents, the governing law, and the case file as a whole, the Court now enters the following opinion and orders.


         I. Factual Background

         Richard Belliveau, an inventor, cofounded High End Systems, Inc. (High End) in 1987. Sealed Resp. Mot. Summ. J. [#148-2] Belliveau Decl. at l.[1] High End is a lighting company that specializes in producing complex lighting and projection systems. Id. From 1987 to 1998 and from 2004 to 2017, Belliveau was employed by High End. Id. at 1-4. During the years Belliveau was not employed by High End, he worked independently as an inventor and secured a number of patents related to lighting and projection systems. Id. at 1. Belliveau is the sole owner of these patents. Id.

         After Belliveau returned to High End in 2004 to serve as the company's Chief Technology Officer (CTO), Belliveau and High End entered into a contract granting High End an exclusive license to use the IP that Belliveau developed during his time away from the company. Id. [#148-4] Ex. A (Exclusive License and Option Agreement). In exchange for this exclusive license, High End agreed to pay royalties to Belliveau and to use commercially reasonable efforts to commercialize Belliveau's IP. Exclusive License and Option Agreement at 3-10; see also Resp. Mot. Summ. J. [#147] at 11. Following the execution of this license agreement, High End was acquired by Barco.[2] Belliveau Decl. at 1.

         In January 2017, Barco began to explore a possible sale of High End to another company, Electronic Theatre Controls, Inc. (ETC). As due diligence progressed, Barco repeatedly consulted Belliveau to determine whether the proposed transaction might affect intellectual property related to Barco's products. Sealed Resp. Mot. Summ. J. [#148-40] Ex. 36 (Koester Dep.) at 4-5; id. [#148-21] Ex. 16 (Due Diligence Emails) at 2-3; id. [#148-22] Ex. 17 (Braet Dep.) at 4; see also Resp. Mot. Summ. J. [#147] at 9 (describing Belliveau assistance during due diligence process). Though Belliveau was generally cooperative in answering these inquiries, he "started to sense that Barco was withholding information." Resp. Mot. Summ. J. [#147] at 9.

         On February 16, 2017, Belliveau met with ETC and was informed that he would not be continuing on as CTO. Resp. Mot. Summ. J. [#147] at 10. In response, Belliveau tendered his resignation. Sealed Resp. Mot. Summ. J. [#148-32] Ex. 27 (Resignation Email) at 2. Belliveau alleges that Barco "knew that [ETC] planned to tell Belliveau that ETC was going to fire him as CTO." Id. Less than a week later, Belliveau filed suit against High End, alleging High End had breached the Exclusive License and Option Agreement by "refusing to engage in [a] mandatory mediation procedure" necessary to investigate infringement of Belliveau's IP by an unnamed third party-presumably, Barco.[3] Notice Removal [#1-1] Ex. A (Pet.) at 8.

         Shortly after Belliveau filed suit against High End-and in reliance on a prior suggestion made by Belliveau himself[4]-Barco and High End entered into an agreement granting Barco a sublicense to use Belliveau's IP. Resp. Mot. Summ. J. [#147] at 11; Sealed Resp. Mot. Summ. J. [#148-35] Ex. 30 (Sublicense Agreement) at 1. Scott Brown, a Barco-appointed High End officer who also served as an officer and director of Barco, signed the Sublicense Agreement on behalf of High End. Sublicense Agreement at 10; Resp. Mot. Summ. J. [#147] at 11. Belliveau alleges no in-house lawyers or outside counsel represented High End's interest in the negotiations. Resp. Mot. Summ. J. [#147] at 11. Barco did, however, have to negotiate with ETC's in-house counsel regarding the terms of the Sublicense Agreement, Sealed Reply Mot. Summ. J. [#153-4] Ex. 3 (Verheggen Dep.) at 5-9, and it is unclear why Belliveau believes the buyer of High End was unmotivated to protect the interests of the company it was purchasing.

         In any event, despite ETC's involvement in the negotiations, Belliveau contends Barco used its control over High End to cause High End to grant the sublicense to Barco less than a week before Barco sold High End to ETC in March 2017. Resp. Mot. Summ. J. [#147] at 10-11. Belliveau further contends that by granting this sublicense, High End breached its obligation under the Exclusive License and Option Agreement to use commercially reasonable efforts to commercialize Belliveau's IP. Id.

         II. Procedural Posture

         After initially filing suit against High End in state court, Belliveau amended his complaint to add Barco as a defendant and dismissed all claims against High End. Notice Removal [#1-8] Ex. H (Fourth Am. Pet.) at 1; id. [#1-9] Ex. I (PL's Mot. Dismiss) at 2. In the wake of this amendment, Barco removed this action to federal court on the basis of diversity jurisdiction under 28 U.S.C. § 1332. Id. [#1] at 4-6. After several subsequent amendments to his complaint, Belliveau eventually alleged Barco is liable for High End's supposed breach of the Exclusive License and Option Agreement between Belliveau and High End. Sixth Am. Compl. [#103] at 20. Belliveau also asserted claims against Barco for breach of fiduciary duty, fraud by misrepresentation and nondisclosure, constructive fraud, and unjust enrichment. Id. at 22-35.

         In 2018, Barco moved for summary judgment on all of Belliveau's claims. Mot. Summ. J. [#122]. In January 2019, the Court granted summary judgment in favor of Barco on Belliveau's breach of contract, fraud by misrepresentation, and unjust enrichment claims. Order of Jan. 18, 2019 [#197] at 16. But the Court denied summary judgment on Belliveau's breach of fiduciary duty, fraud by nondisclosure, and constructive fraud claims, on the ground that genuine issues of material fact existed as to whether a fiduciary relationship existed between Belliveau and Barco. Id. at 15-16. Belliveau later moved for reconsideration of the Court's order granting summary judgment to Barco on the breach of contract claim. Belliveau Mot. Recons. [#221]. The Court denied the motion. Order of Feb. 21, 2019 [#221] at 10-11.

         Now Barco moves for reconsideration of the summary judgment order to the extent that order denied summary judgment on the breach of fiduciary duty, fraud by nondisclosure, and constructive fraud claims. Barco Mot. Recons. [#219]. Meanwhile, Belliveau moves the Court to certify its partial summary judgment on Belliveau's claims as a final judgment under Rule 54(b) so that Belliveau can immediately appeal the Court's ruling on his breach of contract claim to the Fifth Circuit. Mot. Certify [#241]. Both pending motions are ripe for review.


         I. Motion for Reconsideration

         A. Legal Standards

         1. Summary Judgment

         Summary judgment shall be rendered when the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine dispute as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 323-25 (1986); Washburn v. Harvey, 504 F.3d 505, 508 (5th Cir. 2007). A dispute regarding a material fact is "genuine" if the evidence is such that a reasonable jury could return a verdict in favor of the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

         Once the party moving for summary judgment has made an initial showing that there is no evidence to support the opposing party's case, the opposing party must come forward with competent summary judgment evidence sufficient to establish a genuine issue of material fact. Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 587 (1986). In ruling on a motion for summary judgment, the court must view all inferences drawn from the factual record in the light most favorable to the nonmoving party. Matsushita, 475 U.S. at 586; Washburn, 504 F.3d at 508. But it is not the court's duty to "sift through the record in search of evidence" to support the nonmovant's opposition to the motion for summary judgment. Adams v. Travelers Indem. Co. of Conn., 465 F.3d 156, 164 (5th Cir. 2006). Rather, it is the nonmovant's duty to identify specific evidence in the record and to articulate the precise manner in which that evidence supports the nonmovant's claim. Id.

         Additionally, mere conclusory allegations are not competent summary judgment evidence and are insufficient to defeat a motion for summary judgment. Turner v. Baylor Richardson Med. Ctr., 476 F.3d 337, 343 (5th Cir. 2007). Unsubstantiated assertions, improbable inferences, and unsupported speculation are likewise not competent summary judgment evidence. Id. And, particularly relevant here, while the court must not make credibility determinations or weigh evidence, Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000); Anderson, 477 U.S. at 254-55, it is "well settled" in the Fifth Circuit that "when the sole evidence purporting to create a genuine issue of material fact ... is an affidavit that conflicts with deposition testimony," the party seeking to rely on the affidavit must provide a coherent explanation for the conflict in order to avoid summary judgment. Copeland v. Wasserstein, Perella & Co., 278 F.3d 472, 482 (5th Cir. 2002).[5]

         "Only disputes over facts that might affect the outcome of the suit under the governing laws will properly preclude the entry of summary judgment." Anderson, 477 U.S. at 248. Disputed fact issues that are "irrelevant and unnecessary" will not be considered by a court in ruling on a summary judgment motion. Id. If the nonmoving party fails to make a showing sufficient to establish the existence of an element essential to its case and on which it will bear the burden of proof at trial, summary judgment must be granted. Celotex, 477 U.S. at 322-23.

         2. Reconsideration

         "Rule 54(b) allows parties to seek reconsideration of interlocutory orders." Austin v. Kroger Tex., LP, 864 F.3d 326, 336 (5th Cir. 2017); see also FED. R. Civ. P. 54(b). "Under Rule 54(b), the trial court is free to reconsider and reverse its decision for any reason it deems sufficient, even in the absence of new evidence or an intervening change in or clarification of the ...

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