Cyberlock Consulting, Inc. v. Information Experts, Inc.
2013 U.S. Dist. LEXIS 49092
| E.D. Va. | 2013Background
- IE and Cyberlock formed a First Teaming Agreement in fall 2008 to pursue an OPM FIS prime contract;
- The First Teaming Agreement planned a subcontract (Exhibit D) and defined Cyberlock’s role in the prime contract;
- IE and Cyberlock executed the First Subcontract on November 6, 2008 after IE won the prime contract;
- Cyberlock completed its work on the First Subcontract by September 2011;
- Cyberlock and IE then executed a Second Teaming Agreement on October 4, 2011 with a merger/integration clause and a provision that either party bears its own costs;
- OPM FIS awarded IE the prime contract for a new program on February 22, 2012, and negotiations for a subcontract continued until IE ended negotiations on April 2, 2012;
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether post-award obligations in the Second Teaming Agreement are enforceable contracts | Cyberlock contends the Second Teaming Agreement bindingly allocates 49% of the prime work. | IE contends the post-award terms are an unenforceable agreement to negotiate in good faith. | Unenforceable agreement to negotiate; no binding 49% allocation. |
| Whether the Second Teaming Agreement contains an enforceable subcontract obligation | Cyberlock argues the agreement’s language shows a binding subcontract obligation. | IE argues the agreement is an open framework contingent on future negotiations and client approval. | Language read as a framework; not a binding subcontract. |
| Whether Cyberlock’s unjust enrichment claim is barred by the Second Teaming Agreement | Cyberlock asserts benefits conferred to IE warrant recovery. | Second Teaming Agreement precludes recovery absent a binding contract. | IE entitled to summary judgment on unjust enrichment. |
| Whether the court should strike Cyberlock facts/evidence as extrinsic to contract interpretation | Cyberlock relies on extrinsic evidence to show intent. | Extrinsic evidence is inadmissible if the contract is unambiguous. | Grant IE’s Motion to Strike; extrinsic evidence rejected. |
Key Cases Cited
- Beazer Homes Corp. v. VMIF/Anden Southbridge Venture, 235 F.Supp.2d 485 (E.D. Va. 2002) (agreements to negotiate are unenforceable in Virginia)
- Virginia Power Energy Mktg., Inc. v. EQT Energy, LLC, 2012 WL 2905110 (E.D. Va. 2012) (contract writing presumes an agreement to agree; integration clauses matter)
- Schafer Assocs., Inc. v. Cordant, Inc., 254 Va. 514, 493 S.E.2d 512 (Va. 1997) (ambiguous contract analysis and parol evidence limits)
- Boisseau v. Fuller, 30 S.E. 457 (Va. 1898) (clear reading of language governs; intentions inferred from whole document)
- Doswell Ltd. P’ship v. Virginia Elec. & Power Co., 251 Va. 215, 468 S.E.2d 84 (Va. 1996) (parol evidence rule and contract interpretation rules)
- Golding v. Floyd, 261 Va. 190, 539 S.E.2d 735 (Va. 2001) (court reads contract as written; intent from language; no extrinsic evidence if unambiguous)
- Berry v. Klinger, 300 S.E.2d 792 (Va. 1983) (read the contract as a whole; avoid finding ambiguity from disagreement)
- High Knob, Inc. v. Allen, 138 S.E.2d 49 (Va. 1964) (rules on enforceability of oral or collateral promises in contract contexts)