and millions of dollars were on the line the company owed him one million six hundred thousand in cash and stock free and clear and he told them that is confidentiality alone was worth millions that day jenks position was clear it would take millions for him to sign one hundred out of one everyone knew that jane was free to go work for dollars largest competitor and they needed to lock him down that very day to prevent him from doing so after all j had increase dollars revenue by half a one billion dollars in only twenty months and he could do the same for their competitors that's wired through the company's billionaire founder flew into the u s from china with his and we go with outside counsel on speed dial to negotiate a deal with jang in person the stakes were that high i'm going to sound like my colleague judge what has in an earlier argument you can choose to spend your time and growing through the facts or you can start to address the legal issues of which i think there are three st is the choice of law that reformation of the contract whether in your opponent was entitled to any damages as the district court did not provide those damages are right thank you your honor i will turn right into the legal inquiries turning st your honor to the theory of mutual mistake that they played in their complaint and do you mind following judge lynch is laying them out and start with the choice of law because go in judge lynch as order with respect to the choice of law it's clear as an additional matter that the result is the same the standards for mutual and unilateral mistake are respectively clear and convincing evidence and full clear and decisive evidence i thought you said that individual law you had to prove fraud or unilateral mistake but not a massachusetts law that's correct fraud or in equitable conduct that's correct your honor but what you your law applies given the district court apply the massachusetts law yes your honor we believe that about five minutes we believe that the district court applied that the secondary analysis the st analysis as as massachusetts follows the restatements when it sits in diversity is is there a substantial cost between the deal and the state that was chosen and does it offend any other states rights to to follow the choice of law there's no argument before this court that massachusetts policy is offended and with respect to the choice of virginia law we argue that the contacts are indeed sufficient judge their outside counsel who wrote the agreement was in virginia she testified that they discussed putting virginia as the choice of law into the agreement and that i thought she said it was a mistake on our part and state that i didn't catch that that this was sort of a standard clause used in other contracts the district court found that in fact the lo activity was in massachusetts you may well be right that the legal test that the district court articulate it was a bit too narrow but you have not presented any argument that i am aware of at that it was unreasonable for massachusetts to apply its state law here given the cast of money of record that this was just another mistake so your honor that's what the in house lawyer testified the outside lawyer who wrote the draft of the agreement said she couldn't recall when they that but they had discussed using virginia law it's also important to note judge that the nd agreement that was signed that same day for the consultancy they specifically chose massachusetts law which is further evidence that virginia was was other lawyers paul but in terms of trying to reach an understanding of what the terms would be the lawyer should memorialise who was in gage in those discussions your honor is correct it was the principles food and jang the only discussion took place the day before the signing at foods hotel certain things are agreed upon as we know from joint appendix one hundred and seventeen dollars to st jan would stay on a consultant to finish up a merger as a consultant at two hundred and forty dollars k per year for two years sec it food would quote take care of his employment agreement and quote take care of his outstanding stock work one million at the time finally food quote treat jane well for any other restrictions i e non competing confidentiality etc the janks parting words from that discussion were as follows if we need to sign a new agreement it depends on what perhaps but that's six hundred and eighty thousand dollars was about what he was still owed under the compensation agreement something that figure comes from that's correct your honor he had sixteen months left on his employment you meant six hundred eighty thousand dollars of salary under there but it's critical your honor to note that at that hotel meeting the only actual negotiation no dollar figures were discussed for the severance they subsequently went to the office where called genuine office and slid an agreement across the table which said six  total jank rejected that as insulting and humiliating told them to get him a better deal and didn't even dignify it with a counter he got up and left the room he walked down the hall and told a human resources executive who came in with food from china and said i guy had finished thank you judge as and said to that human resources executive my confidentiality alone is worth millions that juxtaposed with the fact that they already owed him it's undisputed one million six hundred thousand in equity and cash when he subsequently was presented with a deal for millions he had no reason especially a summary judgment confidentiality compete disclosure never part of the original employment agreement what did when did those provisions enter into the agreement was it were they in that separation made the offer of that agreement that he rejected that was the st time he had seen the karan that's why he walked down the hall and told the h r executive that his his confidentiality alone was worth millions t undisputed in the record your so is it your position it with respect to the agreement but he saw it the st six hundred and eighty thousand dollars represented contemplation that he was of that he was owed apart from the consultancy agreement of the star but there would have been no difference between that and the green it that he that he simply reject his central enter into it was that st proposed along with the severance after the separation agreement was rejected or was that proposal off on with the separation agreement so your honor if i could take you back to answer your question directly to that discussion we had at the  hotel the st thing through told jang was we're removing you from your position how would you like to come back and work at the home office in china jang replied that his children and family were in school here he's a us citizen so he couldn't go back now maybe in a couple of years at which point they started a discussion conceptually about what to do next the st thing through said was we need you to stay on as a consultant there was a merger specifically the project mohawk deal that's in the record your honor that they wanted him to finish and to advise another high level corporate strategy issues they agreed on a salary of two hundred and forty for two years then they shifted the discussion to what else and that what else was as i suggested separation agreement or not is the consultancy and the two hundred and forty thousand dollars salary affixed to it was in that deal he rejected flat yes you're right he rejected out i gather because of there that contain actual contract so from millions to eleven million dollars is a considerable jump if we thought that that supported a conclusion that your client should have known that was a mistake what would follow because what i'm quite understanding is you seem to be making the argument that there's no basis for saying they had agreed to six hundred and eighty thousand so there'd be no basis for reparation to six hundred and eighty thousand because that's what he rejected we concluded that he should have known it was a mistake so there was you know out on mistake but you are right they never agreed on six hundred and eighty thousand dollars that would just seem to render there to be no contract at all and you get nothing well to two possible outcomes there your honor because reformation is an equitable remedy this court can find st that he should have known which which we dispute and still declined to reform the contract because the alternative yeah but then what happens what happens if you don't reform don't you then just have no contract what would you get well one of if you don't reform it then you leave the contract in place even if even if we get it it was a unilateral mistake yes your honor under in its progeny the court can make that conclusion and the court can also void the entire contract if it so inclined finding that there was no meeting of the minds at which point jane couldn't look he can't get back to sixteen months he served as non can be he can't get back the fact that question the court raised was the choice of law issue and like to address the the the the law is clear and massive that massachusetts courts will uphold the party's choice as long as the result is not contrary to public policy and as long as the designated state has some substantial relation to the contract i thought there was a separate thing which is the restatement provides and which there's no indication massachusetts love rejects that when the parties have shows and in non massachusetts form even if there is no contact massachusetts as long as there's a reasonable basis for that choice they don't force what the parties joe so i think select a non massachusetts state if there is a reasonable basis for that selection even if there is no contact as to choose it we will enforce what the party select and i think the go case does in it provides that they will allow us to enforce it why would we assume messages would reject the restatement but because there is no substantial relation your honor and there is no basis for thinking that the parties had actually chosen virginia law can i ask you about that because yes a little bit turning to me is that if i understand the course of dealing here it was your counsel who was located in virginia who drew up the contract who chose to do it and there's testimony that that's the standard thing he does is that he picks virginia and he's a regina based attorney and the worrisome thing is that the employer can select a forum have it there then finds out in the course of the dispute that that forms law is not going to be so good for it and suddenly says i don't know why we chose that and then we're not supposed to enforce it that's very troubling to me and it gives you kind of a free look at whether you want to keep the agreement if it helps you you will then you just testify yes it would be really good to have  lawyer testifies that she doesn't know why virginia law was put in there i think it's reasonable for that for for one to assume that the reason it was there is because she sits and virginia and right when not will based as you picked a lawyer who knows because your honor that is not a that is not a relationship between the parties and the state of virginia the fact of the matter is that all of the locus here was in massachusetts a parties to choose a we have a lawyer drafting you know is virginia law that's why we picked regional law both parties know it why wouldn't we just and force it what's the what is not against public policy that i can see to do that the test the test i would agree with your your  or if the testimony was that the chart parties had shows in virginia law here the testimony is to the contrary here the testimony is that they don't know how the choice of law virginia got into the agreements and that that wasn't in essence some form of a mistake that for ginia lawyer does not testify that she there is no testimony in the record that she ordinarily uses backwards we just have to believe her testimony i think there's no i do not believe there is a test order to that effect and in fact her testimony is that she doesn't know why virginia law was used in the agreement outside the inside counsel for dower testifies that there was no discussion that she recalls about the choice of virginia law and neither mr jang nor mr fu who actually had the conversations about what the green should contain had any discussion about the choice of law that from the outset of the negotiations that he was not going to accept to do you know what only six hundred and eighty thousand dollars to which he was already in the end he would sign a document that would pay him six hundred and eighty thousand dollars that's six hundred and eighty thousand dollars figure represented the total compensation he was owed i mean that the argument that that is what history of negotiations that he would have understood that the six hundred thousand dollars was all he was going to get in compensation two things i would three things i would say to that your honor  eighty thousand dollars in compensation st it included a component for payment to the salary that had been left unpaid on the former contract that was six hundred and eighty thousand  included a component and under which mr zhang would receive a payment in cash in china for his stock that portion was not reduced to writing but undisputed your honor that mr jane did in fact receive that pursuant to the verbal agreement that was made between mr chang and mr food during the discussions and mr jang also received two hundred and forty thousand dollars for two years so four hundred and eighty thousand dollars additional that he was not entitled to under what was his existing agreement where he was when he was supposed to work so that's that's correct your honor but the amount of additional work was undetermined and quite frankly that was in large part the consideration for mr j and that mr james was being offered to enter into agree included six hundred and eight thousand plus the payment of the stock in the two hundred and forty thousand dollars of our consultants agreement he didn't get the separation agreement for six hundred and eighty thousand dollars that doesn't preclude either the stock or the consultant is the agreement he rejects it am supposed to believe that when he gets a nother agreement he was expecting six hundred and eighty thousand dollars plus stock in the consultancy agreement why would that make so much if any efforts agreement had additional terms clear that when miss high i knew the lawyer the in house lawyer for the company came into the room and the agreements the earlier agreements that were separation agreement and employment  consulting agreement were rejected she understood mr food to be accepting the sum of money and that all he was rejecting was the at will nature and the nature of the consultancy versus an employment or your honor i don't think it is a jury question i think the question really comes down to what was negotiated and whether or not those negotiations mattered not what mr  was in his mind which he did not verbalize at the time to mr j or to mr through or any of anyone else in the negotiation itself remember mr mr sayings coun cheney only negotiated with mr through so any discussions that mr jain claims to have had with someone else or relevant to what mr foo believed was the situation why does that that you just referenced why does your constant pointing out of them because she was in the room and she heard directly from mister mr jay about why he was rejecting the agreement at hand and your honor asked a question that went to why it would be logical for that rejection to have occurred without any increase in the monetary psalms so i doubt it leads logically to this question nonetheless that there is a unilateral mistake at least as to what is a pretty blatant mistake as to the monthly payments and whether the reformation of the contract too was an aqua double remedy here i assume that my memory is that this is characterized as an aqua tipple remedy in which a it's our review would be for abuse of discretion when judge baronet asked the question of your opponent i assertion per se of abuse of discretion but i did hear some argument as to why from their point of view it was  te would you please respond to that argument well there's no question that the the remedy of reformation is an equitable robert in your honor and to the extent that credible ramadans or reviewer is under under an abuse of discretion standard the court should have that standard if on the other hand the court determined that for example there counsel yes all of that's a given now why should we disregard or reject his arguments made and response to judge well your honor it's it's simply not an inequitable position to leave him in this was that the this was the decision this was the agreement that was negotiated and agreed upon between the parties  to the extent that he has a after the fact concern over what he actually agreed to at the time that's not russian that's lunch is asking is if we disagreed with many of your premises and we thought that he had not agreed to six hundred and eighty thousand dollars if we thought that instead he it was a unilateral mistake that he should have known about why would it be  a deal that was the equivalent if not worse than what he had already rejected because because in a unilateral mistake case one attempts to put the parties to the positions that they had that were actually negotiated here the evidence is that the only numbers that were discussed where the numbers that the company is asking the court to  then mr would have known that excuse me would not have known that a mistake had occurred here he should have known that a mistake had occurred and he should known that the mistake that occurred was that the six hundred and eighty thousand dollars over a period of sixteen months that had been intended had been changed to six hundred and eighty thousand dollars for sixteen months in fact he should be held to that number because he should have known that it was a mistake and remain silent that deferred it judge bear and you have one  question that you flight the analysis you've just done brings us to the equitable question and you're not still answering why to say that he should have known is to say that he did not know which means there can't be a meeting of the minds between them so then the question is why is it equitable to hold him to what he should have no one possibility is on the facts of the case it is a credible we happen to have a case like he's being held to is the precise number he rejected in the separation agreement which makes it least they still a theme arguably inequitable to give him that number and you still have not made an argument about why it would be a good exercise of discretion in this type of case to hold him to the numbers you reject well i suppose your honor that that the answer to that question really depends on on how one answers whether or  not what he should have known and since our argument is that he should have known that the company had intended only to offer six hundred and eighty thousand dollars over sixteen months and not for sixteen months he should be held to that number and that would be equitable ok well so your opposing counsel suggested that he would be happy with an outcome that just why is holding him to a reformed contract equitable in light of the alternative and well sorry guys you have no contract you can say well he at least gets money under what the district court did and if there is no contract he gets nothing and then i guess there is a future of lawsuits and then i suppose there is an argument that gosh this saying has been litigated for several years and there is nothing aqu allowing a new round of litigation here and this because he gets something is much preferable to he gets nothing but maybe if the statute of limitations doesn't bar at he can bring another lawsuit well i suppose that the through your honor that if the if the decision of the court were to determine that there was no meeting of the minds and therefore there was was no contract no no no no stop you have mistaken my premises premises is there was a unilateral mistake then there is an equitable choice to be made as to whether you reform the contract or you just the whole contract and when judge barron asked your opponent about that to my surprise he seemed to be willing to accept an outcome here voiding the entire contract which would mean he gets nothing so that's the context in which we're asking these questions sir certainly honor the company does not think that that would be the equitable result here the equitable result is the one that would put the parties in the position that is fair fair position that the company notes is the one that it but weaves the contracts called for which would mean that the payments that the company has already made fulfilled its obligations ok i have one last question if we thought ridgeon your law did apply based on the fact that the contract says the argument from your apply under under virginia law the law is fraud or any other an equitable conduct and so quite frankly if if the facts were as we signing something just because you should have known is not just carelessness but is inequitable know nothing nothing specific to that effect your honor i says so so wh here where the number had been multiplied sixteen fold and went from being a six hundred and eighty thousand dollars payment over sixteen months to an approximately eleven million dollars payment over sixteen months that that required something more than simple misunderstanding on the part of mr zhang particularly in light of his testimony about the conversation with mr f welcome back to minutes leisure to be back thank your honour's as an initial matter voiding the contract your honor is not the right answer here is better than as gala wants sticking him with these restrictive covenant entire contract is void and that was the appropriate remedy that would be the secondarily appropriate remedy that the appropriate remedy here because your heart that's what you thought the appropriate a matter of law by clear and convincing evidence that jane should have known in fact the monthly payments in the history of these parties dealings is almost irrelevant they never paid on time she never complained and eventually they caught up with him and lump sums just like when he flew to china they gave him a lump sum albeit in a bag of cash but that was the history of the dealings between these parties is they promised to pay him one day they never did they always short changed him  i don't see how that helps you here at that isn't what happened with respect to the sixteen followed by increase are you saying that it's somehow justified because they delayed in paying and furthermore after joining tells them he's worth millions the inference here at summary judgment the proper one is that they skipped to the end game and put the millions on the table that he was desiring because they needed to lock him down that day food flew in from china to do this in person he could have left and went to the next biggest competitor the next morning they had to lock him down this is got to go before a fact finder because whether or not jay knew were should have known is a question of a state of mind which i striking for four months he received a payment that precisely tracks their understanding of the deal is that correct for four months he got th of the overall payment he got the twenty strongly support the notion you know he he he understood that was the deal to the extent that the documents suggested something else he would have understood or should have understood that that was in stake your honor there's two critical facts which which require a fact finder on that very question st as i stated earlier the past dealings between the parties were they underpaid him he kept his head down cultural considerations undisputed again he never complained and they eventually caught nd and perhaps more importantly during that period of underpayment it is undisputed that mr john went to see a tax plan or a financial planner to ascertain how best to manage the liability on a ten million dollars payment he was receiving from a chinese company he believed it was coming he went and it's undisputed he saw that tax winner in december of two thousand and seventeen someone who doesn't believe the money's coming doesn't do that especially a s he does if he is trying to take advantage of this situation and how said he's not going to be caught and you're exactly right your honor there is that potential in friends but at summary judgment we draw in in jen's favor and your honor just pointed out exactly what what i'm thinking which is it's got to go before a fact finder to determine which of those is the case i believe judge baron has a question of question i ha one thing that is just curious to me about that is what what is your account of why the company is seeking to now have it be changed to nine hundred thousand what were the conditions in that without going to take away some of the as don't understand why the company would suddenly come in if they thought they only own six hundred and eighty thousand dollars and suddenly say well we should take nine hundred  consultancy agreement so what they were saying was we're not going to pay a millions that we agreed to pay you we're just going to pay you what we want to instead go ahead and sign this and by the way all your restrictions the claw back of your guaranteed monies the non compete the confidentiality we're keeping that too and at that time when he rejects that your client rejects the nine hundred thousand right what is the evidence about his state of mind when he rejects the one one hundred thousand the evidence shows that he believed he was intitled to the ten million his bargain because his response was no pay me what we agreed to and that's critical your honor because again the past practices of the parties create a fact the necessity for a fact finder they never paid him on time he never complained the only time he actually speaks up on his own behalf and complains is when they affirmatively say we're not going to pay you what we are because until that point in time they always eventually caught up with h ok one last one of us an equitable point under virginia law given a thing to say on the why isn't there an argument that if you should have no and yet you nonetheless go ahead and sign when you should have known that that's an equitable as opposed to just careless so i agree with your honor that that that would be careless is under these facts because jang told them it would take millions to get him to sign for those  and they offer to millions having said that judge that's a question for a fact finder as to whether or not he should have known because i don't want to be you know like oh thank you thank you thank you both thank you