CORBIS CORPORATION v. STONE
Court of Appeals of Washington, Division One.
Filed: March 26, 2012.
Additionally, the Development Agreement was a fully integrated document, and "constitute[d] the entire agreement between the Parties . . . supersed[ing] any and all prior and contemporaneous agreements or communications with respect to such subject matter."
The Development Agreement required InfoFlows to first produce a specification of each phase of the system, then build and deliver an "alpha" version of the system, and then a final version of the system, all subject to Corbis' approval. Corbis had the right to accept or reject InfoFlows' delivered product at Corbis' sole discretion. If Corbis rejected a delivered product, it could terminate the Development Agreement for cause or require that InfoFlows correct and resubmit. According to Corbis, it "rejected InfoFlows first delivery of functional specifications because it had failed to meet Development Agreement milestones." Corbis then gave InfoFlows an opportunity to "correct the problems," but InfoFlows "failed to deliver a working `alpha' demonstration of the system[,]" and as such Corbis terminated the Development Agreement on October 12, 2006.
At trial, however, Tanya Miksys (a Corbis-hired consultant) testified that InfoFlows had, in fact, met the alpha delivery date. Counsel for InfoFlows introduced a September 20, 2006 email from Miksys to Weiskopf and others. That email attached a Boulder Ridge "status report". The report states, "InfoFlows met the [A]lpha delivery due date and a review meeting was held. All deliverables were acceptable, although the Corbis Technical Lead will continue to review the deliverables in detail to validate that the project is on track." Given Corbis terminated the Development Agreement, Corbis and InfoFlows never entered into a Jazz Services Agreement.
In January 2007, InfoFlows announced the "Fedmark" license management system on its website. Corbis believed that Fedmark went beyond the scope of the Jazz Services clause in the Development Agreement, and that InfoFlows had taken Boulder Ridge license management design documents, re-labeled them, and was offering a product to the public based on work product generated while InfoFlows was working with Corbis.
Corbis and InfoFlows sued each other on January 22, 2007. Corbis alleged misappropriation of trade secrets, breach of contract, and unfair business practices. InfoFlows alleged misappropriation of trade secrets, conversion, breach of contract, breach of the duty of good faith and fair dealing, unjust enrichment, and fraud. The cases were consolidated. The trial court granted Corbis' motion for partial summary judgment seeking return of the $500,000 Jazz Service advance fee. The court also granted Corbis' motion for partial summary judgment as to the "unambiguous" definition of "Jazz Service" in the Development Agreement. That order reads in pertinent part:
(2) The definition of "Jazz Service" is not ambiguous and can be determined by the Court from the Development Agreement between the parties; and