Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_00-cv-00945/USCOURTS-azd-2_00-cv-00945-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1441 Petition for Removal- Injunctive/Declaratory Relief

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 Defendants will be referred to collectively as "Hennigan" unless otherwise specified.

WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Taser International, Inc., 

Plaintiff, 

vs.

Hennigan International, Inc., et al.

Defendants. 

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No. CV-00-945-PHX-ROS

OPINION AND ORDER

This case involves the relationship between Taser International, Inc. ("Taser") and

Thomas Hennigan, et al. ("Hennigan").1

 After the rulings on summary judgment, the issues

remaining for trial were whether Taser and Hennigan had entered into a contract and whether

Hennigan was entitled to compensation pursuant to that contract or pursuant to the theory of

quantum meruit. On day three of the bench trial, Taser moved to dismiss the claims of

Hennigan. (Tr. p. 475) The Court heard oral argument on that motion and ordered additional

briefing on the issues. (Tr. 9/6/05) Based on the evidence and testimony presented at trial,

Taser is entitled to judgment on the contract claim and on the quantum meruit claim. 

I. Standard for Judgment on Partial Findings

Federal Rule of Civil Procedure 52 provides that " [i]f during a trial without a jury a

party has been fully heard on an issue and the court finds against the party on that issue, the

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2

 Taser moved to dismiss pursuant to Rule 41. (Tr. p.475) Rule 41(b) has been

replaced by Rule 52(c) and it is the latter rule that applies here. Ritchie v. United States,

2006 WL 1727359, at *3 n.7 (9th Cir. June 26, 2006). 

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court may enter judgment as a matter of law against that party with respect to a claim . . . that

cannot under the controlling law be maintained or defeated without a favorable finding on

that issue."2

 As recently set forth by the Ninth Circuit, a district court "deciding whether to

enter judgment on partial findings under Rule 52(c) . . . is not required to draw any inferences

in favor of the non-moving party; rather, the district court may make findings in accordance

with its own view of the evidence." Ritchie v. United States, 2006 WL 1727359, at *3 (9th

Cir. June 26, 2006). Thus, Hennigan is not entitled to any favorable inferences and the

following findings of fact constitute the Court's view of the evidence. 

II. Findings of Fact and Conclusions of Law

Taser is an Arizona corporation in the business of manufacturing and marketing stun

guns, including electro-muscular disruption ("EMD") weapons known as the "Advanced

Taser," "X-26," and "M-26." (Joint Revised Pretrial Order "JRPO" p.11) EMD weapons

are popular among law enforcement agencies because they allow officers to debilitate a target

without the use of potentially lethal force. (Id. p.12) Sometime in 1997 or 1998 Taser and

Hennigan began having discussions regarding a business relationship. (Doc. 63 ex. 1) Rick

Smith, the CEO of Taser, met with Hennigan on February 27, 1998. On that date, Smith and

Hennigan conducted a demonstration of the Air Taser Product for the New York Police

Department. (JRPO p.12) There is no evidence of a written agreement between Taser and

Hennigan. (Tr. p. 165) On February 21, 2000, Taser sent Hennigan a letter terminating their

relationship. (Id.) Hennigan died on April 18, 2001. (Id.)

A. Contract Claim

As set forth in the summary judgment rulings, and agreed to by the parties, Arizona

law applies to Hennigan's claims. (See Doc. 97, 134) Pursuant to Arizona law, "for an

enforceable contract to exist there must be an offer, an acceptance, consideration, and

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3

 Hennigan claims that the Savoca decision was substantially limited by the Arizona

Supreme Court in a later decision. (Doc. 176 p.5) But the cases cited by Hennigan do not

support his argument. In Schade v. Diethrich, 760 P.2d 1050, 1057 (Ariz. 1988), the Arizona

Supreme Court ruled that lack of certainty regarding certain aspects of a contract did not

render it unenforceable. But the court recognized that the plaintiff in that case had presented

sufficient evidence of both "a bargain, consisting of promises exchanged, and consideration."

Id. Here, it is not just the lack of certainty regarding certain terms at issue; instead, Hennigan

failed to establish a bargain, consideration, or certainty of terms. Also, in Arok Construction

Co. v. Indian Construction Services, 848 P.2d 870, 874 (Ariz. Ct. App. 1993), the issue was

whether summary judgment regarding the existence of a contract was appropriate. The court

held that "the evidence [was] sufficient to raise a triable issue of whether a contract

exist[ed]." Id. Here, the issue is not whether there was sufficient evidence to survive

summary judgment but whether Hennigan presented sufficient evidence to satisfy his burden

of proof. He did not. 

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sufficient specification of terms so that the obligations involved can be ascertained."3

 Savoca

Masonry Co., Inc. v. Homes & Son Const. Co., Inc., 542 P.2d 817, 819 (Ariz. 1975). At

trial, Hennigan first took testimony from Harvey Russell. Hennigan and Russell entered into

a business relationship with respect to the marketing of Taser's products in late 1997. (JRPO

p.12) Russell was not present during any negotiations between Taser and Hennigan. (Tr.

p.160) Russell was not aware of the content of negotiations between Taser and Hennigan.

(Id.) Russell's knowledge of the alleged contract between Hennigan and Taser primarily

came from conversations Russell had with Hennigan, not from conversations between

Russell and Taser. (Tr. 52, 162) During a conversation Russell had with Smith, Russell

related why he had started promoting Taser's products and why he continued to do so. (Tr.

91) Smith's response to Russell's statements was simply "I know that." (Tr. 92) This

statement by Smith is insufficient to establish the existence of an offer, acceptance, and

consideration between Taser and Hennigan. 

Exhibits 13 and 14 do not support Hennigan's contract claim. Those exhibits include

communications between Hennigan and Smith. In Exhibit 13, Hennigan expressed some

concern to Smith about receiving payments from business generated on certain accounts.

(Ex. 13) Smith responded that Taser was in the process of "putting a fully documented

program in place." (Ex. 14) Smith's statement that a program was being put in place points

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to there not being a formal contract between Hennigan and Taser at that time. Exhibit 97

also fails to establish that there was a contract between Hennigan and Taser. That exhibit

merely establishes that Taser had started using "an account management program"; it did not

establish that an agreement existed between Taser and Hennigan. The other exhibits offered

by Hennigan similarly failed to establish the existence of a contract. (I.e. ex. 100, 224, 316)

The other testimony offered by Hennigan did not establish that a contract existed.

Neither Kathleen Hanrahan, Patrick Smith, nor Stacie Sundberg adequately testified to the

existence and content of an agreement between Taser and Hennigan. Hennigan did not meet

the burden of establishing an "offer, an acceptance, consideration, and sufficient specification

of terms so that the obligations involved can be ascertained." Savoca, 542 P.2d at 819. There

was no clear testimony or evidence regarding what Taser and Hennigan had agreed to do and

absent such evidence there is an insufficient basis for finding a contract existed.

Accordingly, Taser's motion for judgment on partial findings regarding the contract claims

will be granted. 

B. Quantum Meruit

Having failed to carry his burden of establishing the existence of a contract,

Hennigan's alternative theory of quantum meruit becomes relevant. See USLife Title Co. of

Arizona v. Gutkin, 732 P.2d 579, 584 (Ariz. Ct. App. 1986) ("[O]ur courts have repeatedly

held that the existence of a contract specifically governing the rights and obligations of each

party precludes recovery for unjust enrichment."). To recover pursuant to quantum meruit

Hennigan had to prove "(1) that he [was] entitled to restitution, i.e., that [Taser] was 'unjustly

enriched at [his] expense' . . . ; (2) that he rendered services which benefitted [Taser]; and (3)

that he conferred this benefit under circumstances which would render [Taser's] retention of

the value without payment inequitable." Landi v. Arkules, 835 P.2d 458, 467 (Ariz. Ct. App.

1992) (quoting Restatment (First) of Restitution §§ 1, 40). Hennigan also had to present "a

reasonable basis in the evidence for the trier of fact to fix compensation." Short v. Riley, 724

P.2d 1252, 1255 (Ariz. Ct. App. 1986) (emphasis added) (quoting Nelson v. Cail, 583 P.2d

1384, 1387 (Ariz. Ct. App.1978)). 

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4

 Hennigan argues that "the burden should be on [Taser] to show that Hennigan and

Russell did not contribute to the later sales, even if another distributor was involved." (Doc.

168 p. 17) Hennigan does not provide any support for this shifting of the burden of proof,

and the Court declines Hennigan's invitation to do so. 

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Russell and Hennigan both performed a variety of services for Taser. For example,

Russell or Hennigan attended agency demonstrations, a mock prison riot, and trade shows.

(Tr. 293, 80, 131, 141) Taser's counsel admitted during trial that the work Russell and

Hennigan performed prior to February 2000 was not gratuitous. (Tr. 538) But Hennigan did

not produce expert witness testimony, lay witness testimony, or documentary evidence

linking his activities to later sales by Taser. Hennigan also failed to present any reliable

method of measuring the benefit received by Taser as a result of his activities.4

 Thus, the

claim for recovery pursuant to quantum meruit must be rejected. 

At the final pretrial conference, Hennigan's counsel and the Court discussed the need

for an expert witness at trial. The Court expressed its belief that, on the issue of quantum

meruit, "an expert would not be needed or not be useful." (Tr. 7/28/05 p.40) Hennigan's

counsel responded,

Your Honor, you may very well be a hundred percent right. In fact,

I am inclined to agree with you. I simply had reserved [the

possibility of calling an expert.] But if Your Honor were to say, well,

I don't see how an expert is going to help me other than, you know,

the normal arguments by counsel and the evidence before you, I

would say that's fine. Let's go that way. 

(Id. emphasis added) The Court then stated that if Hennigan's counsel agreed, "there will be

no expert testimony on damages, that is, quantum meruit." Hennigan's counsel agreed, but

wished to reserve the possibility of an expert on "the calculation issue." While this

conversation represents the Court's initial opinion regarding expert testimony, Hennigan was

free to reopen the issue at trial if it became apparent that such testimony was needed. 

At trial, Hennigan did not call any expert to establish the value of services rendered

to Taser. In fact, Hennigan persisted in his belief that such expert testimony was not

necessary. When responding to Taser's Motion to Dismiss, Hennigan's counsel did not argue

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that he should be allowed to present additional evidence in the form of expert testimony;

rather, he argued that the evidence already presented was sufficient. (Tr. 9/6/05 p.515-518)

Only in his Reply to the Motion to Dismiss did Hennigan raise the possibility that he should

be allowed to "choose . . . an expert and . . . present him or her." (Doc. 176 p.23) At the time

of that request, it was unclear if Hennigan wished to retain a new expert or if an already

disclosed expert would be able to provide the testimony. In light of Hennigan's failure to

present such testimony during the course of his case, and his failure to identify what evidence

an expert would be able to produce, Hennigan did not present any "reasonable basis in the

evidence" to allow the Court to determine the appropriate amount of compensation and the

quantum meruit claim fails. Short, 724 P.2d at 1255. 

III. Motion to Strike

Plaintiff moved to strike certain portions of Hennigna's Reply Memorandum based

on non-compliance with the Local Rules. (Doc. 177) There was some confusion regarding

the form of additional briefing the Court requested at trial. Thus, the non-compliance will

be excused and the motion to strike will be denied.

IV. Remaining Issues

The Court asked Taser what issues would remain in this case if the Court were to enter

judgment in favor of Taser on both the contract and quantum meruit claims. (Tr. p. 575)

Taser responded that the only claim remaining would be for a small amount of money

allegedly owed by Hennigan. (Id.) Taser agreed to dismiss this claim without prejudice if

the Court ruled in its favor on the other counts. (Id. at 576) Hennigan now claims, however,

that it is undisputed that Taser owes him approximately $9,600. The Court is unable to

determine whether this is a valid amount and the parties will be directed to submit briefing

on that issue. 

Accordingly,

IT IS ORDERED Henningan's claims based on an alleged contract are DISMISSED

WITH PREJUDICE for the reasons set forth above.

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IT IS FURTHER ORDERED Hennigan shall submit a brief not exceeding 17 pages

in length in support of his claim for approximately $9,600. That brief is due August 18,

2006. Taser shall submit a response also limited to 17 pages by September 1, 2006.

Hennigan may submit an 11 page reply by September 8, 2006.

IT IS FURTHER ORDERED Taser's Motion to Strike (Doc. 177) is DENIED.

DATED this 4th day of August, 2006.

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