MEMORANDUM OPINION AND ORDER – PAGE 1

IN THE UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF TEXAS

DALLAS DIVISION

INFOWISE SOLUTIONS, INC. §

§

Plaintiff, §

§

v. § Civil Action No. 3:04-CV-0553-N

§

MICROSTRATEGY INC., et al., §

§

Defendants. §

MEMORANDUM OPINION AND ORDER

Before the Court are Plaintiff’s Motion for Leave to File First Amended Original

Complaint [#64] filed December 17, 2004, Defendants’ Motion to Strike Plaintiff’s First

Amended Original Complaint [#74] received December 22, 2004, Defendants’ Motion to

Dismiss Plaintiff’s Claims for Fraud and Exemplary Damages [#74] received December 22,

2004, and Defendants’ Motion for Summary Judgement [#102] filed January 31, 2005.

Because the amended complaint exceeds the scope of leave granted in the Court’s order filed

December 10, 2004 and would unfairly prejudice the Defendants, the Court denies the

Plaintiff’s motion for leave. Because the Plaintiff does not state a claim for fraud that both

satisfies the elements of fraud and is sufficiently particular, the Court grants the Defendants’

motion to dismiss. Finally, for the reasons stated below the Court denies the motion for

summary judgment on the Plaintiff’s contract claim, but otherwise grants the motion.

 

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MEMORANDUM OPINION AND ORDER – PAGE 2

I. TRANSACTIONS UNDERLYING THE DISPUTE

On or about November 1, 1999, Plaintiff Infowise Solutions, Inc. (“Infowise”) and

Defendants MicroStrategy Incorporated and MicroStrategy Service Corporation (collectively,

“MicroStrategy”) entered into a Reseller Agreement granting Infowise the right to market,

distribute, and sublicense MicroStrategy software in the United States and Canada. On July

10, 2001, MicroStrategy and Infowise amended and modified the Reseller Agreement with

the Sales Commission Addendum (the “Addendum”). The Addendum provided that

Infowise could earn a 5% sales commission from a prospective license of MicroStrategy

software to GlaxoSmithKline (“GSK”). On December 11, 2001, MicroStrategy and Infowise

executed an Amendment to the Addendum (the “Amendment”), extending the original

expiration date of the Sales Commission Addendum until December 31, 2001. (The Reseller

Agreement, the Sales Commission Addendum, and the Amendment to the Sales Commission

Addendum are referred to collectively as the “Contract.”) In December 2001, MicroStrategy

licensed software to GSK.

In February 2004, Infowise sued MicroStrategy alleging breach of contract, common

law fraud, and, in the alternative, unjust enrichment. Infowise claims that MicroStrategy

owes Infowise a sales commission as a result of the 2001 license of MicroStrategy software

to GSK, and that its refusal to pay that commission breaches the contract or, in the

alternative, unjustly enriches MicroStrategy. Infowise also claims that MicroStrategy

fraudulently induced it to enter into the Addendum and the Amendment. 

 

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On December 17, 2005, Infowise’s filed another motion for leave to amend and its First

Amended Complaint. In addition to the repleaded fraud claims, the amended complaint

contained additions to Infowise’s claim for breach of contract, outlining responses to

arguments that had been suggested by MicroStrategy. On December 22, MicroStrategy filed

a motion for leave to file motion to strike the first amended complaint and attached the

motion to strike. The Court subsequently granted leave.

2

A better course would have been for Infowise to file a first amended complaint that included

only the repleaded fraud claim. Infowise could have then accompanied that filing with the

filing of its motion for leave to amend and attached a second amended complaint that

included the additional breach of contract sections. The motion to strike by MicroStrategy

could then have been styled as a response to the motion for leave.

MEMORANDUM OPINION AND ORDER – PAGE 3

On December 10, 2004, this Court granted MicroStrategy’s motion to dismiss the

fraud claim, because Infowise’s petition failed to allege fraud with particularity as required

by Federal Rule of Civil Procedure 9(b), and granted Infowise leave to replead its fraud

claim. On December 17, 2004, Infowise filed its First Amended Complaint, repleading its

fraud claim and adding allegations unrelated to its fraud claim, and also filed a motion

requesting further leave to amend.

II. INFOWISE’S AMENDED COMPLAINT EXCEEDS THE LEAVE PREVIOUSLY GRANTED

In its December 17, 2004 motion, Infowise moves for leave to amend its complaint

to include additional sections in its breach of contract claim.1

 The additional sections go

beyond the scope of the leave granted by the Court in the Order of December 10, 2004.

Accordingly, the Court evaluates the request for leave to amend independent of the prior

order.2

Federal Rule of Civil Procedure 15(a) requires that leave to amend be given freely

when justice so requires. However, justice is not served if the party opposing would suffer

 

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Although this case deals with common law fraud, rather than securities fraud, the application

here of Rule 9(b) is the same.

MEMORANDUM OPINION AND ORDER – PAGE 4

undue prejudice. Foman v. Davis, 371 U.S. 178, 182 (1962). Here, Infowise offers these

amendments after the close of discovery, hindering MicroStrategy’s ability to adequately

prepare. The new pleadings added do not explain or elaborate the prior pleadings, but rather

present new bases why Infowise need not fulfill the Contract’s conditions precedent. 

MicroStrategy has not taken discovery on these heretofore unpled theories. Accordingly, the

Court denies Infowise’s motion for leave to amend with respect to the amended breach of

contract claim. Specifically, the Court strikes the three (3) new sections of the contract claim

in the First Amended Complaint, sections 4.03, 4.04, and 4.06.

III. INFOWISE DOES NOT STATE A FRAUD CLAIM THAT BOTH SATISFIES 

THE ELEMENTS FOR FRAUD AND IS SUFFICIENTLY PARTICULAR

MicroStrategy again moves to dismiss Infowise’s amended claims for fraud on the

grounds that they do not meet the heightened pleadings requirement of Rule. 9(b). FED. R.

CIV. P. 9(b). Rule 9(b) requires that plaintiffs state averments of fraud with particularity.

Id. To do this, plaintiffs must “specify the statements contended to be fraudulent, identify

the speaker, state when and where the statements were made, and explain why the statements

were fraudulent.” Williams v. WMX Technologies, Inc., 112 F.3d 175, 177-78 (5th Cir.

1997); see also Southland Sec. Corp. v. INSpire Ins. Solutions, Inc., 365 F.3d 353, 362 (5th

Cir. 2004).3

 This rigorous standard applies to omissions as well as explicit statements.

Plotkin v. Ipaxes Inc., 407 F.3d 690, 696 (5th Cir. 2005). 

 

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MEMORANDUM OPINION AND ORDER – PAGE 5

A dismissal for failure to plead fraud with particularity as required by Rule 9(b) is a

dismissal on the pleadings for failure to state a claim. Southland, 365 F.3d at 361; FED R.

CIV. P. 9(b). When considering a motion to dismiss for failure to state a claim, courts must

accept a plaintiff’s factual allegations as true. Kaiser Aluminum & Chem. Sales, Inc. v.

Avondale Shipyards, Inc., 677 F.2d 1045, 1050 (5th Cir. 1982). However, dismissal is proper

“if the complaint lacks an allegation regarding a required element necessary to obtain relief,”

Apani Southwest, Inc. v. Coca-Cola Enterprises, Inc., 300 F.3d 620, 624 (5th Cir. 2002)

(citation omitted), or if it otherwise fails to give the defendant fair notice of what the

plaintiff’s claim is and the grounds upon which it rests. Conley v. Gibson, 355 U.S. 41, 47

(1957); FED. R. CIV. P. 12(b)(6).

The Court’s December 10, 2004 Order outlined deficiencies in Infowise’s fraud

allegations. With the exception of the allegations concerning the June 29, 2001 email,

addressed below, the amended complaint fails to cure those deficiencies. Paragraphs 5.02(a)

and 5.02(b) are identical to the statement s alleged in the Original Complaint.. (1st 

Am. Compl. ¶¶ 5.02(a)-(b).) Accordingly, the Court again dismisses the fraud allegations

in paragraphs 5.02(a) and 5.02(b) for the same reasons they were dismissed in the December

10, 2004 Order. Paragraph 5.02(c) fails to allege when the statement was made. (1st 

Am. Compl. ¶ 5.02(c).) Accordingly, the Court dismisses paragraph 5.02(c).

The lone remaining alleged fraudulent statement does not constitute a material

representation. Infowise alleges that David Russell of MicroStrategy told Kerry Kiser of

Infowise, “I think your work has been strong, and we will work out a fair amount of revenue

 

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Specifically, for common law fraud Infowise must allege that: (1) the defendant made the

material representation; (2) the material representation was false when made; (3) the speaker

either knew the material representation was false, or made it recklessly without knowledge

of its truth and as a positive assertion; (4) the speaker made the material representation with

the intent that it should be acted upon; (5) the party acted in reliance on the material

representation; and (6) the party was injured as a result. Herrmann Holdings Ltd. v. Lucent

Techs., Inc., 302 F.3d 552, 564 n.3 (5th Cir. 2002); Burleson State Bank v. Plunkett, 27

S.W.3d 605, 612 (Tex. App. – Waco 2000, pet. denied).

MEMORANDUM OPINION AND ORDER – PAGE 6

for your assistance and guidance,” in an e-mail dated June 29, 2001. (1st Am. Compl. ¶

5.02(d).) While this allegation is sufficiently particular, both the statement’s timing and

content make it legally immaterial. 

In order to satisfy both Rules 12(b)(6) and 9(b), a fraud claim must allege the elements

of fraud in addition to being particular.4

 Pure expressions of opinion will not support an

action for fraud. Transport Ins. Co. v. Faircloth, 898 S.W.2d 269, 276 (Tex. 1995). When

parties express such opinions in negotiation for a good or service, they engage in “puffery.”

“Puffery is an expression of opinion by a seller not made as a representation of fact.”

Dowling v. NADW Mktg., Inc., 631 S.W.2d 726 , 729 (Tex. 1982); see also BLACK’S LAW

DICTIONARY 1269 (8th ed. 2004) (definition of “puffery”). A statement’s lack of specificity,

that it contains imprecise or vague representations, is a factor that indicates the presence of

opinion rather than factual representations. Angelo Broad., Inc. v. Satellite Music Network,

Inc., 836 S.W.2d 726, 733 (Tex. App. – Dallas 1992, writ denied) overruled on other

grounds, Hines v. Hash, 843 S.W.2d 464, 469-70 (Tex. 1992).

Kiser made the statement prior to the signing of the Addendum; it did not concern an

agreement in place between the parties. Its referral to “strong work” and “fair revenue” have

 

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Infowise quotes one additional statement in its amended fraud claim. An internal

MicroStrategy email indicates the need to “throw [Infowise] a bone.” Infowise does not cite

the email as a fraudulent statement, but rather to support an allegation of MicroStrategy’s

fraudulent intent. As the Court dismisses all alleged fraudulent statements on other grounds,

the Court need not address scienter.

MEMORANDUM OPINION AND ORDER – PAGE 7

the indefiniteness characteristic of puffery. The statement, therefore, cannot serve as the

basis for a fraud claim. Because each statement alleged by Infowise is either insufficiently

particular or not fraudulent, the Court accordingly grants MicroStrategy’s motion to dismiss

the fraud claim.5

IV. MICROSTRATEGY’S MOTION FOR SUMMARY JUDGMENT

In its motion filed January 31, 2005, MicroStrategy moves for summary judgement

on Infowise’s claims for attorney fees and breach of contract. The Court addresses each

claim below.

A. Summary Judgement Standard

Summary judgment is proper when the pleadings and evidence demonstrate that no

genuine issue of material fact exists and the movant is entitled to judgment as a matter of law.

FED. R. CIV. P. 56(c). An issue is material if its resolution is potentially outcome

determinative. Weeks Marine, Inc. v. Fireman’s Fund Ins. Co., 340 F.3d 233, 235 (5th Cir.

2003). A dispute as to a material fact is genuine if the evidence is such that a reasonable jury

could return a verdict for the nonmoving party. Boudreaux v. Swift Transportation Co., 402

F.3d 536, 540 (5th Cir. 2005). The Court must accordingly view all facts and inferences in

the light most favorable to the nonmoving party. Id. at 540.

 

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MEMORANDUM OPINION AND ORDER – PAGE 8

B. Virginia Law Does Not Award Attorney’s Fees for Contract Claims

MicroStrategy moves for summary judgement on Infowise’s claims for attorney’s

fees, arguing that Infowise is not entitled to recover attorney’s fees as a matter of law. The

Contract contains a governing law clause designating the Commonwealth of Virginia as the

source of law for the Contract. The parties agree that Virginia law governs the Contract.

Virginia law specifies that attorney’s fees are not permitted in a breach of contract

action unless the contract specifically provides otherwise. Ryder v. Petrea, 416 S.E.2d 686,

688 (Va. 1992). Here, the Contract has no provision providing for the payment of attorney’s

fees. Thus, the collection of attorney’s fees by Infowise is barred. The Court has dismissed

Infowise’s fraud claims and Infowise does not otherwise seek attorney’s fees. Accordingly,

the Court grants partial summary judgement dismissing Infowise’s claims for attorney’s fees.

C. Breach of Contract

In Virginia, a plaintiff must establish three elements in order to recover for breach of

contract: (1) a legally enforceable obligation of a defendant to a plaintiff; (2) the defendant's

violation or breach of that obligation; and (3) injury or damage to the plaintiff caused by the

breach of obligation. Filak v. George, 594 S.E.2d 610, 614 (Va. 2004).

MicroStrategy argues two bases for granting summary judgement on Infowise’s

breach of contract claim. First, MicroStrategy contends that the terms of the Contract

preclude the recovery of damages for breach. In the alternative, MicroStrategy contends that

Infowise did not fulfill their requirements as stated in the Contract, relieving MicroStrategy

of any duty to perform. The Court addresses each contention below.

 

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Traditional contracts doctrine characterized this requirement as one of mutuality; however,

discussions of mutuality led to confusion and the inappropriate weighing of the worth of each

sides’ consideration. Modern doctrine clarifies this thinking by holding that a consideration

based on a illusory promise is not consideration at all. See Bancorp, 66 Va. Cir. at 73; 3

RICHARD A. LORD, WILLISTON ON CONTRACTS § 7:14 (4th ed. 2005).

MEMORANDUM OPINION AND ORDER – PAGE 9

1. Interpreting the Damages Clause to Prevent Recovery for Breach Would Cause

the Contract to Be Invalid for Absence of Consideration. – It is black letter, contract law

that the formation of a contract requires valid consideration. RESTATEMENT (SECOND) OF

CONTRACTS CHAPTER 4,TOPIC 1, intro. note (1981). Where two parties exchange promises,

each party must have “the right to hold the other to a positive agreement. Both parties must

be bound or neither is bound.” Wexford Bancorp, L.L.C. v. Concept 1, L.L.C., 66 Va. Cir.

72, 73 (2004) (quoting Am. Agric. Chem. Co. v. Kennedy & Crawford, 48 S.E. 868, 870 (Va.

1904)). Words of promise that by their terms make performance entirely optional do not

constitute a promise. RESTATEMENT (SECOND) OF CONTRACTS § 2 cmt. e (1981).

Consideration based solely on an illusory promise is not consideration at all.6 See Bancorp,

66 Va. Cir. at 73; 3 RICHARD A. LORD, WILLISTON ON CONTRACTS § 7:7 (4th ed. 2005).

The interpretation of a contract is a question of law. Garcia Enters. v. Enter. Ford

Tractor, 480 S.E.2d 497, 498-99 (Va. 1997). “A contract must be construed as a whole to

determine parties’ intent with respect to specific provisions.” Westmoreland-LG & E

Partners v. Va. Elec. & Power Co., 486 S.E.2d 289, 294 (Va. 1997). Where a business

transaction is based on more than one document executed by the parties, a court should

construe documents together to determine the intent of the parties. Daugherty v. Diment, 385

S.E.2d 572, 574 (Va. 1989). Where a contract may have alternative constructions, one

 

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Further, where the terms in a contract are clear and unambiguous, the contract is construed

according to its plain meaning. Bridgestone/Firestone, Inc. v. Prince William Square

Assocs., 463 S.E.2d 661, 664 (Va. 1995). That said, whether a writing is ambiguous is also

a question of law, not fact. Westmoreland, 486 S.E.2d at 294. Ambiguity exists when

contractual language admits to being understood more than one way. Id.

MEMORANDUM OPINION AND ORDER – PAGE 10

rendering it valid and the other void, courts will follow the valid interpretation if reasonable.

Merriman v. Cover, Drayton, & Leonard, 51 S.E. 817, 817 (Va. 1905). Courts will not

presume the parties intended an invalid contract.7 Id.; 3 RICHARD A. LORD, WILLISTON ON

CONTRACTS § 32:11 (4th ed. 2005).

In the present matter, the Contract between the parties contains limitation of liability

provisions. The most significant provision states: 

NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR DAMAGES

OF ANY KIND, INCLUDING INCIDENTAL OR CONSEQUENTIAL

DAMAGES. Reseller [Infowise] acknowledges that (i) Reseller has no

expectation and has received no assurances that any investment by Reseller in

the promotion of MicroStrategy Products will be recovered or recouped or that

Reseller will obtain any anticipated amount of profits by virtue of this

Agreement. THE PARTIES ACKNOWLEDGE THAT THIS SECTION HAS

BEEN INCLUDED AS A MATERIAL INDUCEMENT FOR

MICROSTRATEGY TO ENTER INTO THIS AGREEMENT AND THAT

MICROSTRATEGY WOULD NOT HAVE ENTERED INTO THIS

AGREEMENT BUT FOR THE LIMITATIONS OF LIABILITY AS SET

FORTH HEREIN.

MicroStrategy contends that this language precludes Infowise from recovering for

breach of contract. Specifically, MicroStrategy points to the phrase “neither party shall be

liable to the other for damages of any kind.” However, such an interpretation would

eliminate Infowise’s ability to hold MicroStrategy to a positive agreement. This result would

render any promise made by MicroStrategy in the Contract illusory. Consideration based on

 

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MicroStrategy cites no cases supporting its interpretation as possible in a valid contract. The

case MicroStrategy does nominally cite in support of its interpretation states only that the

absence of injury or damage, not the limitation the of liability for damages by a contract

provision, prevents a cause of action. Caudill v. Wise Rambler, Inc., 168 S.E.2d 257, 259

(Va. 1969). The elements of a breach of contract claim make this much clear.

9

Section 2.1 of the Reseller Agreement is the first substantive section of Reseller agreement

and is Titled “License Grant.” It begins, “Subject to the fees payable hereunder,

MicroStrategy hereby grants Reseller a license to market and sublicense the Product in the

territory indicated in exhibit A upon meeting the Program Requirements set forth in Section

3, pursuant to the terms of this Agreement.”

MEMORANDUM OPINION AND ORDER – PAGE 11

an illusory promise would be no consideration at all and the Contract would fail for lack of

consideration.8

 See Bancorp, 66 Va. Cir. at 73; 3 RICHARD A. LORD, WILLISTON ON

CONTRACTS § 7:7 (4th ed. 2005).

A review of the entire Contract suggests an alternative reasonable and valid

interpretation of the liability limitation. The provisions limiting liability are part of the

Reseller Agreement giving Infowise, as the “reseller,” a license to market and sublicense

MicroStrategy products to third parties.9

 Additionally, the portion of the Contract subject to

dispute for breach is not the Reseller Agreement, but rather the Sales Commission Addendum

signed 20 months after the Reseller Agreement. Given the context of the whole of all the

documents signed by the parties, the liability limitation pertains to liability arising from

activities such as marketing or sublicensing. More generally stated, the limitation of liability

provision pertains to liability arising from acts undertaken in performance (e.g. marketing

and reselling of licenses) of the Contract, not to liability created by the formation of the

legally enforceable obligation (i.e., the Contract itself.) Thus, the Court adopts this

 

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MEMORANDUM OPINION AND ORDER – PAGE 12

reasonable, alternative interpretation of the limitation of liability provision that does not

result in the invalidity of the Contract. Accordingly, the Court rejects MicroStrategy’s

interpretation precluding liability for breach as a basis for summary judgement.

2. There Is a Genuine Issue of Material Fact Whether Infowise Substantially

Complied with Contract Requirements. – Virginia law uses substantial compliance in

multiple contexts as a doctrine of textual interpretation. Shelton v. Virginia, 609 S.E.2d 89,

91 (Va. Ct. App. 2005) (referring to use of substantial compliance doctrine in cases

involving both statutory interpretation and implied consent to searches). “Substantial

compliance with reference to contracts, means that although the conditions of the contract

have been deviated from in trifling particulars not materially detracting from the benefit the

other party would derive from a literal performance, he has received substantially the benefit

he expected, and is, therefore, bound to pay.” Akers v. Barnes, 315 S.E.2d 199, 201-02 (Va.

1984) (quoting Newcomb v. Schaeffler, 279 P.2d 409 (Colo. 1955); emphasis omitted).

Materiality of the difference between what is provided and what is required by the contract

is pertinent to the question of substantial compliance. Akers, 315 S.E.2d at 201. “A minor,

trivial difference can be tolerated whereas a material difference cannot.” Id.

In its motion for summary judgement, MicroStrategy contends that Infowise has not

fulfilled the requirements present in section 4 of the Sales Commission Addendum. The

section requires that:

(a) Partner [Infowise] has submitted a Sales Commission Fee

Registration form to MicroStrategy. The Sales Commission Fee Registration

Form shall, at a minimum consist of a written document providing notice of

registration and shall include the name and address of the Prospect [GSK], a

 

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MEMORANDUM OPINION AND ORDER – PAGE 13

point of contact, phone number, a narrative assessment of the business

opportunity and a description of the Partner’s actual and anticipated marketing

activities.

(b) MicroStrategy has accepted the Sales Commission Registration for

the applicable Prospect.

(c) Partner has been primarily responsible for creating and undertaking

the sales and marketing activity with the Prospect’s organization.

Regarding the first requirement, Infowise contends and offers evidence that they

provided the specified information to MicroStrategy, although not in any particular form.

With respect to the second, Infowise contends and presents evidence to show that, even if no

formal communication declared MicroStrategy’s acceptance for purpose of the requirement,

MicroStrategy recognized and accepted Infowise’s efforts to secure a sales commission.

Finally, as to the third requirement, both sides present substantial evidence to demonstrate

either the extent or lack of role Infowise played in developing the sale of software licenses

to GSK. This evidence creates a genuine issue of material fact whether (a) the information

provided, (b) the acceptance obtained, and (c) the sales and marketing activities created and

undertook were materially different from the stated Contract requirements.

More importantly, MicroStrategy does not demonstrate any material diminution of a

benefit from any variance from strict compliance. The parties dispute only whether the

benefit is attributable to Infowise. Both sides acknowledge that MicroStrategy provided

software licenses to GSK in exchange for some fees. MicroStrategy neither contends nor

presents any evidence to demonstrate that Infowise’s failure to strictly comply with the

requirements materially detracted from the benefit received. Nor does MicroStrategy

contend that some other benefit was materially diminished because of Infowise’s deviation

 

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10MicroStrategy does contend that they considered the requirements themselves to be

material. This addresses a different question from whether the difference between what was

done and what was required was itself material and is not at issue here.

11The Court makes this finding without considering the evidence objected to in Defendants’

Objections to Plaintiff’s Summary Judgement Evidence and therefore need not rule on those

objections. Further, because the Court makes this finding regarding substantial compliance,

it need not consider whether Infowise actually complied with the Contract’s requirements.

12If a court determines a contract governed the interactions between the parties, then recovery

under unjust enrichment will be precluded. Burlington, 925 S.W.2d at 97. Alternatively,

should a contract be found invalid, recovery under that contract would be precluded and a

determination on unjust enrichment would be required. Id. (stating recovery under principles

of unjust enrichment is appropriate when legal reasons make contemplated agreement void.)

MEMORANDUM OPINION AND ORDER – PAGE 14

from strict compliance with the requirements.10 Viewing all facts and inferences in the light

most favorable to the nonmoving party, the Court finds that Infowise presents at least a

genuine question of material fact as to whether the performance rendered was materially

different from the stated Contract requirements and whether this difference materially

detracted from benefits MicroStrategy expected to receive. Accordingly, the Court denies

MicroStrategy’s motion for summary judgement on the breach of contract claim.11

V. THE DETERMINATION THAT A VALID CONTRACT GOVERNS 

PRECLUDES AN UNJUST ENRICHMENT CLAIM

A plaintiff may demand relief under alternative theories. FED. R. CIV. P. 8(a). This

allows a plaintiff to plead both breach of contract or unjust enrichment claims; however, a

plaintiff may not recover under both claims for breach of contract and unjust enrichment.12

See Burlington v. Southwestern Elec., 925 S.W.2d 92, 97 (Tex. App. – Texarkana 1996),

aff’d, 966 S.W.2d 467 (Tex. 1998); Truly v. Austin, 744 S.W.2d 934, 936 (Tex. 1988).

 

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13The parties’ briefs indicate that they assume Texas law govern the unjust enrichment claim.

The Court will follow this assumption.

MEMORANDUM OPINION AND ORDER – PAGE 15

Where a valid, express contract governing the subject matter of the dispute exists the remedy

of unjust enrichment becomes unavailable.13 Burlington, 925 S.W.2d at 97.

As part of its motion for summary judgement, MicroStrategy renews its motion to

dismiss Infowise’s claim of unjust enrichment. In a prior order, the Court denied a

MicroStrategy motion to dismiss the unjust enrichment claim, holding that Federal Rules of

Civil Procedure 8(a) allowed Infowise to plead in the alternative. Today, however, the Court

has construed the Contract’s limitation of liability provisions and determined that an express,

valid contract governs the subject matter in dispute between the parties. Neither party has

raised any other issue questioning the validity of the contract. Accordingly, because it is now

determined that a valid contract governs, the Court dismisses Infowise’s claim of unjust

enrichment.

VI. NO CLAIM REMAINS FOR WHICH EXEMPLARY DAMAGES MAY BE AWARDED

MicroStrategy also renews its motion to dismiss Infowise’s claim for exemplary

damages, premised on the granting of its motion to dismiss. Virginia law requires proof of

an independent, willful tort, beyond the breach of a duty imposed by contract, as a predicate

for an award of punitive or exemplary damages. Kamlar Corp. v. Haley, 299 S.E.2d 514,

517-518 (Va. 1983); Gonella v. Lumbermens Mut. Cas. Co., 64 Va. Cir. 229, 234 (2004).

The Court has dismissed Infowise’s fraud and exemplary damages claim; only the breach of

 

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MEMORANDUM OPINION AND ORDER – PAGE 16

contract claim remains. Accordingly, the Court dismisses Infowise’s claim for exemplary

damages. 

Signed September 29, 2005.

_________________________________

 David C. Godbey

 United States District Judge

 

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