A ft erexami ni ng t he br i efs and appe l l at e r ecor d, t hi s panel has det erm i ned * unani m ous l yt hator al ar gum entw oul d notm at er i al l yas s i s tt he det erm i nat i on of th e s e a p p e a ls . See F ed . R . A p p . P . 3 4 (a)(2); 10 th C ir . R . 3 4 . 1 (G ). T h e c ase s are th e re fo re o rd e re d su b m itt e d w ith o u t o ra l ar g u m e n t. T h is o rd e r a n d ju d g m e n t is notbi ndi ng pr ece dent , exce ptundert he doctr i nes of l aw of the ca s e, r es j udi cat a, and col l at er al es t oppel . I tm aybe ci t ed, how ever , fori t s per s uas i ve val ue c o n s is te n t w ith F e d . R . A p p . P . 3 2 .1 a n d 1 0 th C ir . R . 3 2 .1 . 

## F I LED United States C ourt of Appeals Tenth Circuit 

### Jan u ary12,2007 Elisab eth A. Shumaker C l erk of C ourt UNI TED S TATES CO URT O F AP PEALS F O R T H E T E N T H C IR C U IT A N G E L A M . L E O N A R D , Per s onal Repr e s e nt a t i ve of

t he Es t a t e of

RoyF. L e o n a r d ; AE T NA MORT GAGE C O N S U L T A N T S , IN C . , a D elaw are corpor at i on, P l ai nti ffs-A pp el l ees, v. SUN SET M OR TGA GE, a Penns y l vani a l i m i t ed part ner s hi p,

D e fe n d a n t-A p p e llan t. N os . 04- 4310 & 05- 4116 (D . C . N o. 1:03-C V -92-J ) ( D . U t ah)

ORDE R AND J UDGM EN T * B efor e HENR Y , B RI S CO E , and M UR P HY , C i rcui tJudg es.

Pl ai nt i ffs A ngel a M . L eonar d, as per s onal r epr es ent at i ve fort he es t at e of herdece as ed hus band, R oyF. L eonar d, and A etna M or t gage Consul t ant s , I nc. , t he coupl e’ s w hol l y - ow ned mort gage c orpor at i on, ( L eonar d Par t i es ) s ued defendantTh e d i s t r i c tc o u r td e n i e d t h e Le o n a r d P a r t i e s ’ c l a i m fo rd e a th b e n e fi t s . By 1 fa ilin g to file a c ro s s -a p p e a l, th e L e o n a rd P a rt ie s h a v e n o t p re s e rv e d th a t c la im . See Mon tgo m ery v. C i t y of Ardm ore , 365 F. 3d 926, 944 ( 10th C i r . 2004) ( r equi r i ng cr os s - appea l w her e appe l l ee s eeks t o enl ar ge ow n r i ght s orl es s en rig h ts o f

a d v e rsa ry ); Trigal etv. Young , 54 F. 3d 645, 647 n. 3 ( 10th C i r . 1995) ( not i ng t hatw her e pl ai nt i ffs di d notcr os s - appea l on i s s ue, t hi s courtl acke d ju risd ictio n to c o n sid e r d istric t co u rt’s g ra n t o f su m m a ryju d g m e n t to d e fe n d a n ts o n that issue ).

- 2- Sunse tM or t gage forbr eac h of contr act , al l egi ng thatSunse tM or t gage ow ed M r . L eonar d unpai d comm i s s i ons . U pon cons i der at i on of cr os s - m ot i ons for s um m aryj udgm ent , t he di s t r i ctcour tgr ant ed the Leonar d Par t i es ’ m ot i on, ho l ding t hat Sun setM ort gag e ow ed the L eon ard Part i es the u np ai d co m m i ssi on s, and deni ed Suns etM or t gage’ s m ot i on fors um m aryj udgm ent . Sunse tM or t gage appea l ed. ( A ppeal N o. 04- 4310. ) I tal s o appea l ed the di s tr i ctcourt ’ s or der

1 g r a n t i n g a t t o r n e y ’ s fe e s t o th e L e o n a r d P a r t i e s . ( A p p e a l N o . 0 5 - 4 1 1 6 . ) We re v e rs e b o th d e c is io n s a n d re m a n d fo r f u rt h e r p ro c e e d in g s . I . B ackgr ound M r . L eonar d, doi ng bus i nes s as A etna M or t gage Consul t ant s , w or ked as m arket i ng di r ect or , an i ndepende ntcontr act orpos i t i on, forSunse tM or t gage rec ruit ing p erso n s to e stab li sh S u n set M o rt g ag e b ran ch o ffices. M r. L eo n ard ’s and Suns etM or t gage’ s dut i es and obl i gat i ons w er e s etfor th i n an I ndepende nt C o n tra c to r A g re e m e n t (A g re e m e n t). U n d e r th e ter m s o f th a t A g re e m e n t, M r. L e o n a rd re c e iv e d c o m m is s io n s b a s e d o n th e p ro d u c tiv ity o f th e b ra n c h e s . T he A gr eements etfor t h pr ovi s i ons fort erm i nat i ng the A gr eementw i th or- 3-

w i t houtcaus e. A pl t . A pp. at80- 81. I f Sunse tM or t gage t erm i nat ed w i thout c a u se , itw a s o b lig a ted to p a yM r. L e o n a rd c o m m iss io n s fo r tw e lv e m o n th s. If it ter m in a ted w ith c a u se , “a ll co m p e n sa tio n . . . term in a te[ d ] a n d c e a se [ d ] to acc rue. ” Id. at81. T he A gr eementdefi ned “c aus e” t o i ncl ude “w i l l ful vi ol at i on of anySunse tpol i cy . ” Id . A lso , the A g re e m e n t se t fo rth c o n fid e n tiality p ro v isio n s: I ti s under s t ood and agr eed by[Leonar d] , as a condi t i on of the p a ym e n t o f

fe e s to [ L e o n a rd ], t h a t th e n a tu re o f S u n s e t’ s b u s in e s s . . . r equi r e[s ] confi dent i al i t ybe mai nt ai ned thr oughoutthe pr oces s , and t herefore, [L eon ard] agrees as fol l ow s: (a) [L eon ard] un derst and s and ag rees that al l con versat i on s, recor ds, corr es pondence , fi l es , cus t om erand s uppl i erl i s t s , dat a and other i nform at i on per t ai ni ng t o orconce rni ng Sunse t , i t s aff i l i at es , and t hei rcus t om er s and s uppl i er s ar e conf i dent i al i nform at i on, and t h e r e fo r e , d u r i n g t h e t e r m o f th i s a g r e e me n ta n d fo ra p e r i o d o f two ( 2) y ear s t her eaf

t er , [Leonar d] s hal l notdi vul ge orcomm uni cat e any s uch conf

i dent i al i nform at i on t o anyper s on oror gani zat i on w i thout th e e x p re ss w ritten a u th o riz a tio n o f S u n se t. [L e o n a rd ] a g re e s th a t, u p o n th e ter m in a tio n o f th is a g re e m e n t, he /sh e w ill im m e d iate ly s ur r endert o Sunse tanyand al l fi l es , m emora nda, form s , cus t om er a n d su p p lier lists , o th e r b u sin e ss se rv ice d a ta a n d e v e ry th in g in h is/h e r p o ss e ss io n p e rta in in g to S u n se t an d /o r its a ffili a tes a n d th e ir bus i nes s es , i tbei ng di s t i nct l yunder s t ood thatal l s uch l i s t s , books and r ecor ds and anycopi es ther eof, w hetherpr epar ed by[Leonar d] o r b yo th e rs, a re th e p ro p e rtyo f S u n se t; ( b) [Leonar d] s hal l di s cl os e i nform at i on t o thos e per s ons w ho have a need t o r ece i ve i nform at i on and thats uch di s cl os ur e s hal l be l i m i t ed t o onl ys o m uch of the i nform at i on as i s nece s s aryforthe per form ance of [Leonar d’ s ] s ervi ces ; and ( c) D i s cl os ur e of a nys uch conf i dent i al i nform at i on s hal l r equi r e the e x p re ss w ritten c o n se n t o f S u n se t.- 4-

Id. a t 8 4 -8 5 . I n J ul y2002, Sunse tM or t gage e xer ci s ed i t s r i ghtt o t erm i nat e the A g re e m e n t w ith o u t ca u se . B yd o in g so , itw a s o b lig a ted u n d e r th e A g re e m e n t to payM r . L eonar d comm i s s i ons fortw el ve mont hs aft ert erm i nat i on. A ft erm aki ng s i x paym ent s , Sunse tM or t gage de t erm i ned thatM r . L eonar d had vi ol at ed the c o n fid e n tialityp ro v isio n s a n d b re a c h e d th e A g re e m e n t b ym a in tain in g a w e b site u n d e r th e d o m a in n a m e w w w .su n se tm o rta g e .b iz, w h ich d iss e m in a ted a lleg e d ly confi dent i al pr opr i et aryi nform at i on both befor e and a ft ert erm i nat i on of the A gr eement . O n J anuary31, 2003, Sunse tM or t gage s enta l et t ert o M r . L eonar d, w h o h a d p a ss e d a w a yo n Ja n u a ry1 9 , sta tin g th a t ith a d su sp e n d e d a n yo f its re q u ire m e n ts u n d e r th e A g re e m e n t an d th a t h e sh o u ld “ c e a se a n d d e sis t” d is s e m in a tin g its p ro p ri e ta ry in fo rm a tio n th ro u g h th e w e b s ite w ith in te n d a y s . Id. a t 1 2 5 . A ft erSunse tM or t gage de ni ed the Leonar d Par t i es ’ r eques t s forthe r emai ni ng s i x comm i s s i on paym ent s , theybr oughts ui ti n U t ah s t at e courtal l egi ng t hatSunse tM or t gage br eac hed the A gr eementw hen i tfai l ed t o m ake the rem ainin g six p ay m en ts. S u n set M o rt g ag e re m o v ed the c ase to fed era l cou rt bas ed on di ver s i t yj ur i s di ct i on and defended, i n par tand as r el evantnow , on the gr ound t hatM r . L eonar d di d notper form al l of hi s obl i gat i ons underthe A gr eementand had mat er i al l ybr eac hed the conf i dent i al i typr ovi s i on of the A gr eement . T he part i es fi l ed cr os s - m ot i ons fors um m aryj udgm ent . T he di s tr i ct- 5-

cour tgr ant ed the Leonar d Par t i es ’ m ot i on fors um m aryj udgm ent , di r ect i ng that Sunse tM or t gage make the s i x r emai ni ng paym ent s , t ot al i ng $77, 088. 43, pl us p re- an d p o st-jud g m en t i n terest an d co sts. T h e c o u rtd en ied S u n set M o rt g ag e’s m ot i on fors um m aryj udgm ent . Sunse tM or t gage appeal ed. ( A ppeal N o . 0 4 -43 1 0 . ) T her eaf t er , t he Leonar d Par t i es fi l ed a mot i on foratt or ney ’ s fee s . T he di s t r i ctcourtgr ant ed the mot i on i n the amountof $39, 620. 00. Sunse tM or t gage ag ain a p p ea led. (A p p ea l N o . 0 5 -41 1 6 . ) I I . A ppeal N o. 04- 4310 A . St andar d of R evi ew W e r evi ew t he di s t r i ctcour t ’ s gr antordeni al of s um m aryj udgm ent d e n o v o , a p p lyin g th e s a m e le g a l s ta n d a rd th a t th e d is tr ic t c o u rt a p p lie d . Mon t ero v. Meye r , 1 3 F . 3 d 1 4 4 4 , 1 4 4 6 (10 th C ir . 1 9 9 4 ). U n d er tha t st an d ard , su m m ary j ud gm ent i s approp ri at e “i f t he p l eadings, dep osi t i on s, answ ers t o int err og at ori es, and admi s s i ons on fi l e, t ogetherw i th the affi davi t s , i f any , s how thatther e i s no genui ne i s s ue as t o anym at er i al fac tand thatthe movi ng partyi s ent i t l ed t o a ju d g m e n t as a m a tter o f law .” F e d . R . C iv . P . 5 6 (c ). “A n iss u e o f fa c t is

‘ genui ne’ i f the evi dence al l ow s a r eas onabl e j uryt o r es ol ve the i s s ue ei therw ay and i s ‘ m at er i al ’ w hen i ti s es s ent i al t o the pr operdi s pos i t i on of the cl ai m . ” Hay ne s v . Le v e l3 Com m c ’ ns , LLC , 456 F. 3d 1215, 1219 ( 10th C i r . 2006) (q u o ta tio n o m itte d ), pet i t i on f orcer t . f

i l ed , 75 U . S. L . W . 3266 ( U . S. N ov. 3, 2006)- 6-

( No . 0 6 - 6 3 8 ) . “ On a n a p p e a l f r o m c r o s s - mo t i o n s fo rs u mm a ryj u d g me n t , we co n stru e a ll fa ctua l i n fe ren ce s in fav o r of the p artyag ains t w h o m su m m ary j udgm entw as obt ai ned. ” N ISHv . R u m sfe ld , 3 4 8 F . 3 d 1 2 6 3 , 1 2 6 6 (10 th C ir . 2 0 0 3 ). A lth o u g h fe d era l l aw co n tr o ls ou r rev iew o f w h ethe r th e d istri ct co u rt p ro p e rlyg ra n ted th e L e o n a rd P a rties ’ m o tio n fo r su m m a ryju d g m e n t, Penns y l vani a l aw , t he l aw des i gnat ed bythe A gr eement , governs the ana l y s i s of th e s u b s ta n tiv e b re a c h -o f-c o n tr a c t c la im s . See Kais er - Fr ancis O i lC o. v. P r oducer ’s G as C o. , 8 7 0 F . 2 d 5 6 3 , 5 6 5 ( 1 0 th Ci r . 1 9 8 9 ) ( a p p l y i n g Ok l a h o ma s u b s ta n tiv e la w , c o n s is te n t w ith c o n tr a c ts ’ c h o ic e -o f-l a w p ro v is io n s ). B . A n a ly sis Sunse tM or t gage a r gues t hatthe di s tr i ctcourterr ed i n deny i ng i t s m ot i on fo r sum m aryjud g m en t and in g ran ti n g the L eo n ard P arti es’ m o ti o n fo r sum m ary j udgm entbeca us e M r . L eonar d br eac hed the A gr eementbypubl i s hi ng Sunse t M or t gage’ s confi dent i al i nform at i on on an unauthor i zed w ebs i t e bea r i ng i t s tr ade n am e. Itco n tend s tha t th e L eo n ard P arti es d id n o t pro v e tha t M r. L eo n ard p e rfo rm e d h is o b lig a tio n s u n d e r th e A g re e m e n t, th a t M r. L e o n a rd ’s r ig h t to r ece i ve compens at i on w as condi t i oned upon hi s compl i ance w i th the c o n fid e n tia lity p ro v is io n s , a n d th a t M r. L e o n a rd ’s b re a c h w a s m a te ri a l. T h e re a re g e n u in e iss u e s o f m a ter ial fa c t w h e th e r M r. L e o n a rd a c tu a lly br eac hed the conf

i dent i al i t ypr ovi s i ons of the A gr eementbypubl i s hi ng- 7-

confi dent i al i nform at i on conce r ni ng Sunse tM or t gage on the w ebs i t e. Sunse t M o rtg a g e m a in tain s th a t itfirst le a rn e d o f th e w e b site in Ja n u a ry2 0 0 3 , af ter it had made s i x comm i s s i on paym ent s . T o s uppor tthi s as s er t i on, Sunse tM or t gage r e l i e s o n t h e d e c l a r a t i o n o f i t s P r e s i d e n ta n d Ch i e f Op e r a t i n g Offi c e r , S a mu e l B. M o re lli . In th a t d e c lar a tio n , M r. M o re lli first sta ted th a t h e w a s “ fa m ili a r w ith t he ‘ s uns etm or t age. bi z’ w eb s i t e thatw as once us ed byM r . L eonar d dur i ng the l i fe of t he A gr eementand w hi ch [M r . L eonar d] cont i nued t o us e, w i thout a u th o ri z a tio n , a f

te r t h e A g re e m e n t w a s te rm in a te d .” A p lt. A p p . a t 1 2 1 . A ccor di ng t o M r . M or el l i , t he w ebs i t e publ i s hed the fol l ow i ng confi dent i al i nform at i on: a l i s tof br anche s , a s ampl e br anch manageragr eement , Sunse t M or t gage’ s appl i cat i on t o become a br anch manager , and compens at i on in fo rm a tio n fo r b ra n c h m a n a g e rs . Id. M r . M or el l i fur thers t at ed thatther e w as no w r i t t en author i zat i on t o di s s emi nat e thi s i nform at i on, as w as r equi r ed bythe A g re e m e n t. Id. at121- 22. M r . M or el l i al s o s t at ed thatupon l earni ng t hat M r. L eon ard, M rs . L eon ard and / or A E T N A w ere pub l i shi ng vast amount s of Sunse t ’ s confi dent i al i nform at i on vi a the w eb s i t e, Sunse t d e m a n d e d th a t th e yim m e d iate lyc e a se a n d d e sis t f ro m a n ya n d a ll di s s emi nat i on of s uch conf i dent i al i nform at i on. T hi s demand w as m ade byl et t eron J anuary31, 2003. T hi s l et t ernot ed that M r . L eonar d w as i n di r ectvi ol at i on of the A gr eementand that b e c a u se o f

th e v io latio n s, S u n se t w a s s u sp e n d in g a n ya n d a ll o f its r equi r ement s undert he A gr eement , thus t erm i nat i ng the A gr eement forcaus e. Id. a t 1 2 2 ; s e e a ls o id . a t 1 2 5 (le tter o f Ja n u a ry3 1 , 2 0 0 3 , d ire c tin g M r. L e o n a rd to c e a s e a n d d e s i s td i s s e mi n a t i n g i n fo r ma t i o n a n d u s i n g S u n s e tM o r t g a g e tr a d e n a meO n s um m aryj udgm ent , Sunse tM or t gage di d notpr ovi de copi es of the 2 pages of the w ebs i t e t o pr ove w hatw as on the w ebs i t e ori f the w ebs i t e cont ai ned c o n fid e n tia l in fo rm a tio n . See A p lt . A p p . at 32 3 (ad m issi o n b yS u n set M o rt g ag e’s at t or neyt hati tdi d nothave c opyof w ebs i t e) . I tpr ovi ded onl yt he dec l ar at i on of M r. M o re lli .

- 8- w i t hi n t en day s , not i fy i ng hi m A gr eementhad bee n vi ol at ed ther ebycaus i ng Sunse tM or t gage ha r m , and s us pendi ng Sunse tM or t gage’ s r equi r ement s under A g ree m en t) . 2 T h e L e o n a rd P a rties c o u n ter th a t S u n se t M o rtg a g e w a s a w a re o f th e w e b site ear l i ert han M r . M or el l i ’ s decl ar at i on s ugges t s . M s . L eonar d t es t i fi ed ather depos i t i on t hats he di d notr emem bers how i ng the w ebs i t e t o any one atSunse t M or t gage oras ki ng any one atSunse tM or t gage t o l ook att he w ebs i t e, buts he t houghtt hats he t ol d s om eone a tSunse tM or t gage thatt her e w as a w ebs i t e ort hat s h e w a s w o rk in g o n o n e . Id. at94. B as ed on thi s t es t i m ony , t he Leonar d Par t i es cont end thatSunse tM or t gage kne w of the w ebs i t e and di d nothi ng abouti t , and t he w ebs i t e w as ei t herauthor i zed ort he i nform at i on on the w ebs i t e w as not c o n fid e n tia l o r p ro p ri e ta ry. W hen Suns etM or t gage l earned aboutt he w ebs i t e and w hetheri tacqui es ced i n i t s exi s t ence ar e ques t i ons of fa ctappr opr i at e fora j ur yt o deci de. W e ca nnot s ayt hatt he under l y i ng fac t s ar e undi s put ed ort hatw e ca n hol d as a mat t erof l aw t hat M r. L eon ard breached t he co ntr act . Inst ead, w e con cl ud e t hat there i s a genui ne ques t i on of fa ctw hetherM r . L eonar d br eac hed the A gr eementand, i f s o,I f a fact fi nderfi nds t hatM r . L eonar d br eac hed the A gr eement , t hat 3 fa c tfin d e r m u s t a ls o d e c id e w h e th e r t h a t b re a c h w a s m a te ri a l. S e e Fo re st C ity G r antLi ber t

y Ass ocs . v. G enr o I

I , Inc. , 652 A . 2d 948, 951 ( Pa. Super . C t . 1995) (reco g n izi n g that m aterial ityo f b rea ch is qu esti o n o f fac t) .

- 9- w hetherSunse tM or t gage ha d a dutyt o cont i nue t o m ake the fi nal s i x comm i s s i on paym ent s . A ccor di ngl y , w e conc l ude thatt he di s tr i ctcourterr ed i n gr ant i ng

3 s um m aryj udgm enti n favorof the Leonar d Par t i es . C or r es pondi ngl y , t he di s t r i ct c o u rt p ro p e rl yd e n ie d S u n s e t M o rt g a g e ’s s u m m a ry ju d g m e n t m o tio n . I I I . A ppeal N o. 05- 4116 S u n se t M o rtg a g e a lso a p p e a ls th e d istric t co u rt’s a w a rd o f a tto rn e y ’s fe e s to t he Leonar d Par t i es . B eca us e w e r ever s e the di s tr i ctcourt ’ s deci s i on i n favorof the L eo n ard P arti es, w e m u st al so rev erse the d istri ct co u rt ’s aw ard o f a tt o rne y ’s fe e s to th e m . I V . C oncl us i on T h e d istri ct co u rt ’s j u d g m en t and it s o rde r gra n ti n g att o rne y ’s fe es a re R E V E R S E D , a n d th e c a s e is R E M A N D E D fo r f u rt h e r p ro c e e d in g s . E n tered fo r th e C o u rt

M i chae l R . M urphy C i r cui tJ udge