923 F.3d 819
10th Cir.2019Background
- American Agencies had an exclusive license to certain debt‑collection software and a right of first refusal on its sale; the software contained American Agencies’ customer data and proprietary documents (collection letter, service agreement).
- Advanced Recovery Systems merged into Kinum (facilitated by Sloan); Sloan became Kinum’s CEO; Kinum later sold the software to Sajax without American Agencies’ knowledge.
- American Agencies sued Sloan (among others) for tortious interference (business relations and contract), conspiracy, copyright infringement, unjust enrichment, and trade‑secret misappropriation; a jury found Sloan liable on multiple claims.
- Sloan moved for judgment as a matter of law; the district court denied the motion and Sloan appealed. The Tenth Circuit affirmed in part and reversed in part.
- The court concluded: (1) evidence supported tortious interference with business relations and conspiracy (deceit theory); (2) the jury instructions for tortious interference with contract incorrectly omitted improper means — reversal; (3) copyright claim survived (originality sufficient; commercial‑use challenge not preserved); (4) unjust enrichment lacked evidence quantifying Sloan’s personal benefit — reverse and direct JML.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Tortious interference with business relations & conspiracy — improper means | Sloan used deceit and unfounded litigation to effect transfers and concealments (improper means) | Preemption of deceit theory by Utah statute; insufficient evidence of unfounded litigation | Preemption argument not preserved; deceit theory evidence was not challenged on appeal — liability affirmed |
| Tortious interference with contract — required elements | Sloan induced breach of license via same improper means | Jury instructions omitted "improper means" element; omission was not harmless | Court: Utah law requires improper means; omission prejudiced Sloan — reverse and remand for new trial |
| Copyright infringement — commercial use & originality | Kinum’s use of documents was commercial and documents were original works of American Agencies | Insufficient evidence of commercial use and lack of originality | Commercial‑use challenge not preserved; evidence of minimal creativity sufficient — claim upheld |
| Unjust enrichment — measure of benefit | Sloan (through Kinum) unjustly benefited; value can be inferred from expert testimony | Plaintiff failed to prove amount of benefit conferred on Sloan personally (only Kinum benefit shown) | Evidence did not quantify Sloan’s personal benefit; JML should have been granted — reverse and direct JML |
Key Cases Cited
- Overstock.com, Inc. v. SmartBargains, Inc., 192 P.3d 858 (Utah 2008) (establishing improper means element for certain interference claims)
- Puttuck v. Gendron, 199 P.3d 971 (Utah App. 2008) (civil conspiracy requires underlying tort)
- Unitherm Food Sys., Inc. v. Swift‑Eckrich, Inc., 546 U.S. 394 (2006) (Rule 50 preservation requirements)
- Marshall v. Columbia Lea Reg’l Hosp., 474 F.3d 733 (6th Cir. 2007) (preservation under Rule 50 consequences)
- Feist Publ’ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340 (1991) (originality requires independent creation and minimal creativity)
- Bartee v. Michelin N. Am., Inc., 374 F.3d 906 (10th Cir. 2004) (standard for sufficiency of evidence review)