CORBIS CORPORATION v. STONE
Court of Appeals of Washington, Division One.
Filed: March 26, 2012.
E. Testimony regarding the parties' understanding of the terms of the Development Agreement.
Corbis also claims the trial court erred by permitting Steve Stone to testify as to his subjective understanding of the terms of the Development Agreement, specifically the definition of Jazz Service, which the judge hearing pre-trial motions previously ruled was unambiguously defined in the Agreement. But the two citations to the transcript given in support of this argument do not show the trial court permitted such testimony. Indeed, a review of all of Stone's testimony shows the trial court scrupulously made sure Stone did not so testify. In fact, at one point when counsel appeared to be leading Stone toward such testimony, counsel for Corbis objected, and in a sidebar, the trial court directed counsel to cease that line of questioning and it did not progress further. Moreover, even if Stone made a comment as to his understanding of the definition of Jazz Service, it is difficult to see how it caused any prejudice; the jury was instructed on the definition of Jazz Service, and the instruction reflected exactly the definition in the contract and in the pre-trial ruling:
"Jazz Service," as referred to in the Development Agreement, means: (i) those sets of technologies which enable the injection and removal of handles into Digital Objects; (ii) those necessary technologies to manage these handles to insure their persistence and quality; and (iii) the necessary technologies, which, when added to a web crawler, search for and find handleized Digital Objects.
We find no error on this issue.
F. Alleged adverse inferences from Corbis' assertion of the attorney-client privilege.
Corbis also argues that InfoFlows' counsel "repeatedly encouraged the jury to speculate about the content of communications for which Corbis had properly asserted the attorney-client privilege, and the reasons the privilege had been asserted." We disagree. Corbis cites to five passages in the record on this issue, but none of them shows counsel encouraging the jury to speculate about the content of privileged communications.
For two of the examples, it is clear from reading the transcript that counsel for InfoFlows simply sought to elicit testimony explaining that the jury does not get to see what is blacked out in the partially redacted exhibits he was using. In the third example, one of Corbis' witnesses was cross-examined as to why he sent Stone's materials to an outside patent attorney. The fourth example is nothing more than questions to Weiskpof about a non-privileged email from Corbis' counsel to Stone. And, the fifth example is simply to a passage in InfoFlows' closing argument, but nowhere in that passage does counsel discuss the content of privileged communications. We reject this argument.
1. Although InfoFlows now argues it "never claimed" it should be awarded damages for "lost profits", or for lost opportunities, counsel did argue during closing that the jury could award damages for lost business opportunities on the inducement claim.
2. Corbis' argument that damages award for fraudulent misrepresentation is inconsistent with the award for fraudulent inducement is also well taken. The instructions permitted the jury to award InfoFlows damages for fraudulent inducement to compensate InfoFlows other business opportunities it would have had had it not entered into the Development Agreement with Corbis. But the jury also awarded InfoFlows damages for the value of the company had Corbis and InfoFlows coordinated on patent applications, including patents for the Jazz Service. The award for misrepresentation "admits" the existence of Jim Mitchell's promise to work together on patents, while the award for fraudulent inducement "denies" the existence of the promise, given Stone testified he would not have entered into an agreement with Corbis had he known about the secret patent. See Batcheller, 9 Wn.2d at 404. Thus, these two awards are also "inconsistent" and amount to a double recovery. Melby, 13 Wn. App. at 749.
3. Stone's deposition testimony regarding InfoFlows' damages for its lost business opportunities was read to the jury as follows:
Q: I asked you a question a line four, `Have any of the misrepresentations you told me, told me about this afternoon, caused money damages to InfoFlows?"
There's an objection by Mr. Willey.
And you say, `If I — had I known that Corbis had filed a patent, I would have terminated the relationship. I would have gone a different direction. Instead of a relationship with Corbis funding the jazz service, I would have probably gone the investment route. I would have developed or InfoFlows would have developed a company. In that fashion it's hard to project where we'll be two and a half years later, this being mid 2008, us terminating the relationship in early 2006.
"`So I believe we would be materially further ahead. Where on that plan we would be right now, it's hard for me to gauge'"
I say, `All right [sic], can you quantify this, where the difference between where you are now and where you would have been if you'd never entered into the development agreement in money and dollars?' There's another objection.
You say, `I haven't done that analysis yet. I could probably quantify it, but I don't have a number right now.'
I ask you, `How would you go about it?'
`I would need to think about how I would go about it, so I don't want to know right off — I don't know right off the top of my head.'
`So had you not continued the relationship with Corbis, you think you would have been funded by one of the venture groups that you visited with?'
Answer: `I believe so, yes.'
`Which one?' There's another objection.
`It's unknown to me which one, I don't know.'"
4. See Response Brief at 47 (citing Ali v. Fastners for Retail, Inc., 544 F.Supp.2d 1064 (E.D. CA 2008).