THE DIGITAL GROUP, INC. VS. SAGITEC SOLUTIONS, LLC(C-0216-13, MIDDLESEX COUNTY AND STATEWIDE)
A-0619-15T3
| N.J. Super. Ct. App. Div. | Aug 18, 2017Background
- Digital (IT integrator) and Sagitec (pension software vendor) executed a January 15, 2013 "Preliminary Partnership Agreement" with confidentiality and a non-solicitation/non-disintermediation covenant; term one year, confidentiality survives indefinitely.
- The parties submitted a joint proposal to Fiji National Provident Fund (FNPF) in February 2013; FNPF rejected the joint bid in October 2013 and then directly solicited Sagitec to propose separately.
- Sagitec responded to FNPF’s unsolicited request and later contracted with FNPF in May 2014; Digital objected and refused to sign a requested letter of no-objection.
- Digital sued Sagitec (breach of contract — confidentiality and non-solicitation, breach of implied covenant, unjust enrichment, breach of fiduciary duty, tortious interference, equitable relief); trial court granted Sagitec summary judgment and dismissed all claims.
- On appeal, the court reviewed the record de novo for legal issues and in the light most favorable to Digital for factual disputes and affirmed the summary judgment dismissing Digital’s claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Sagitec breached confidentiality by using Digital’s information to win FNPF contract | Digital: Sagitec used confidential info (FNPF identity, pricing/preferences, insights) from joint proposal in later negotiations | Sagitec: FNPF already knew Sagitec and solicited Sagitec independently; no evidence Sagitec used Digital’s confidential materials | Held: No breach — even assuming information was confidential, record contains no evidence Sagitec used Digital’s confidential info in securing FNPF contract |
| Whether Sagitec violated non-solicitation/non-disintermediation covenant by contracting with FNPF | Digital: Sagitec ‘approached’ or ‘solicited’ FNPF after the joint proposal rejection | Sagitec: Covenant bars affirmative solicitation/approach; FNPF initiated contact — Sagitec only responded | Held: No breach — “solicit/approach” requires affirmative action by the party; FNPF solicited Sagitec, Sagitec did not solicit or improperly approach FNPF |
| Whether other contract-based and equitable claims survive (good faith, unjust enrichment, fiduciary duty) | Digital: Sagitec’s conduct deprived Digital of contract benefits and unjustly enriched Sagitec; fiduciary relationship existed | Sagitec: Claims rest on failed contract theory or lack necessary elements (no fiduciary duty, no wrongful act) | Held: Dismissed — claims lacked factual/legal support and were dependent on no-contract-breach finding |
| Whether tortious interference with prospective economic advantage exists | Digital: Had reasonable expectancy with FNPF and Sagitec maliciously interfered | Sagitec: No evidence Digital had enforceable expectancy or Sagitec acted maliciously | Held: Dismissed — Digital failed to show reasonable expectancy or malicious interference |
Key Cases Cited
- Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520 (N.J. 1995) (summary-judgment standard and view of facts for non-moving party)
- Henry v. N.J. Dep't of Human Servs., 204 N.J. 320 (N.J. 2010) (standard of review for summary judgment on appeal)
- Globe Motor Co. v. Igdalev, 225 N.J. 469 (N.J. 2016) (elements for breach of contract claim)
- Cypress Point Condo. Ass'n v. Adria Towers, L.L.C., 226 N.J. 403 (N.J. 2016) (contract interpretation — intent and extrinsic evidence for ambiguous terms)
- Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366 (N.J. 1995) (de novo review of legal issues)