Doubleclick asserts that this claim is an attempt to replead the previously dismissed
claims for the consequential damages of lost sales and lost business opportunity. A diminution in
the value of confidential information results in conscquential damages such as lost sales and lost
business opportunity. The court has previously found that these consequential damages are
barred by the contracts, so the doppelganger of these damages — loss in the value of Allen
Brothers’ data -- must also be barred.

Moreover, even when the pleadings are read in the light most favorable to Allen Brothers,
it is clear that there are no allegations which support the inference that its customer lists have
some sort of independent and intrinsic value apart from their ability to provide a business
advantage. They are not like an out of circulation gold piece which retains value even if it is not
coin of the realm. Instead, they are a collection of confidential business information which allow
the holder of that information to pursue a business advantage. Dissemination of the confidential
information results in the loss of the ability to pursue that business advantage. The court has
already held that loss of the ability to pursue a business advantage is a type of consequential
damage that is barred by the contract.

Allen Brothers also secks to recover all monies paid to Doubleclick under the contracts.
It seeks, in effect, to be placed in the same position it would have been had it never entered into
the contracts with Doubleclick. This argument fails for two reasons. First, it is in essence a
claim for recission, and thus can only succeed if Allen Brothers establishes all of the elements of
fraudulent misrepresentation. Jahraus v. Bergquist, 494 P.2d 110, 111 (Colo.App. 1971).
Because Allen Brothers’ claim is based on a breach of contract theory, as opposed to fraud, it

cannot slate a claim for recission. In the interests of completeness, the court also notes that, “in a

-4.



District, No. 02CA0556, 2003 WL 1562443 *2 (Colo.App. Mar 27, 2003). There are, however,
two exceptions to this rule: (1) a parly can recover on a quasi-contract when the implied-in-law
contract covers conduct outside the express contract; and (2) a party can recover on a
quasi-contract when the express contract is unenforceable because it was rescinded or is
otherwise not binding. /d.

Here, Allen Brothers contends that Doubleclick should be required to return any benefit it
received from the contract because it breached the contract. This is a claim for unjust
enrichment, also known as quantum meruit. A plaintiff proceeding under a theory of unjust
enrichment must establish exactly what Allen Brothers is trying to establish — that: (1) at the
plaintiffs expense; (2) the defendant received a benefit; (3) under circumstances (hat would
make it unjust for the defendant to retain the benefit without paying. Jd. at 444-45. As noted
above, a plaintiff cannot recover on a quasi-contract theory when an express contract exists,
Dudding v. Norton Frickey & Associates, 11 P.3d at 445. Moreover, Allen Brother’s unjust
enrichment claim does not fit into any of the exceptions to the rule prohibiting quantum meruit
tecovery when there is an express contract. Allen Brothers’ unjust enrichment claim must,
therefore, fail.

The court next turns to Allen Brothers’ claim for damages for the loss in the value of its
data. According to the complaint, Allen Brothers’s confidential information is valuable because
it can gencratc sales. In its response to the latest motion to dismiss, Allen Brothers adds that its
confidential information has a value separate and apart from the sales it might produce and that

Doubleclick’s dissemination of the list caused it to lose value.

-3-



breach of contract action, a plaintiff may only recover the amount of damages necessary to place
him in the same position he would have occupied had the breach not occurred.” Smith v.
Farmers Insurance Exchange, 9 P.3d 335, 337 (Colo, 2000). Thus, Allen Brothers could not get
all of its money back under this theory even if was entitled to rescind the contract.

This leaves Allen Brothers with a breach of contract claim which potentially can only
lead to an award of nominal damages. Doubleclick contends that Allen Brothers cannot proceed
with a breach of contract claim based purely on nominal damages. This is incorrect, as if a
plaintiff establishes breach but cannot establish actual damages, it may nevertheless recover
nominal damages. Interbank Investments, LLC v, Eagle River Water and Sanitation District,
2003 WL 1562443 at *4. Thus, the fact that only nominal damages are potentially available does
not sound the death knell for Allen Brothers’ breach of contract claim.

Allen Brothers’ Request for Specific Performance

Under Colorado law, the equitable remedy of specific performance is only available if
there is no adequate remedy at law. See, e.g., Schreck v. T’ & C Sanderson Farms, Inc., 37 P.3d
510, 514 (Colo. Ct. App. 2001), In connection with Allen Brothers’ request for injunctive relief,
the court previously held that Allen Brothers had failed to establish that it had no adequate
remedy at law. This dooms its request for specific performance. Allen Brothers may sinccrcly
believe, with the benefit of 20/20 hindsight, that agrecing to a very restrictive limitation on
damages was a bad idea. But this belief is not enough to show that there is no adequate remedy

at law, Instead, it simply shows that there is no relief available under the parties” contract.

-5-



Minsate Onder Firm (06,97)

United States District Court, Northern District of Illinois

Nam ee quae Blanche M. Manning regen Seas

CASE NUMBER 01 C 6158 DATE May /3, 2003 :

CASE Allen Brothers v. Doublectick

TITLE

[In the following box (a) indicate the party filing the mation, ¢.g., plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the
MOTION: nature of the motion being presented. ]
DOCKET ENTRY:
qd) oO Filed motion of [ use listing in “Motion” box above.]
(2) a Brief in support of motion due ___.
(3) oa Answer brief to motion due . Reply to answer brief due
(4) oO Ruling/Hearing on setfor at
(5) oO Status hearing[held/continyed to] [set for/re-set for]on__set for at =
(6) oO Pretrial conterence[held/continued (o] [set for/re-set for] on setfor at.
(7) o Trial[set for/re-set for} on __at
(8) o [Bench/Jury trial] [Hearing] held/continued to aat
(9) ira) This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]
G FRCP4(m) © General Rule 21 © FRCP41(a)(1) 0 FRCP41(a)(2).

(10) [Other docket entry] Doubleclick’s motion to dismiss Allen Brothers’ amended complaint (43-1 ]is

granted in part and denied in part. The only portion of the complaint which survives is Allen Brothers’
breach of contract claim, and it may only seek nominal damages in connection with its breach of contract
claim. Enter Memorandum and Order.

date mailed novice

courtroom
deputy’s
initials

RTS

Date/time received in
central Clerk’s Office

railing deputy intlals

qa) a [For further detail see order attached to the original minute order.]
No notices required, advised in open court
No notives required. number of uices *

Y_ | Notices mailed by judge's staff. WAY 1 4 2003
Notified counsel by telephone, : bate docketed —
Docketing to mail notices. , \
Mail AQ 450 form lacus dep iniche

v | Copy to judge/magistrate judge.



Conclusion
Doubleclick’s motion to dismiss Allen Brothers’ amended complaint [43-1]is granted in
part and denied in part. The only portion of the complaint which survives is Allen Brothers’
breach of contract claim, and it may only seek nominal damages in connection with its breach of

contract claim.

bare (8-08 Blamcle-M. Waansiy

Blanche M. Manning
United States District Judge

OlevG158.md



IN THE UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION DOCKETED
MAY 1 4 2003
ALLEN BROTHERS, INC.,
Plaintiff,
v. 01 C 6158

ABACUS DIRECT CORPORATION
n/k/a DOUBLECLICK, INC.,
Defendant.

wwe eee

MEMORANDUM AND ORDER

Defendant Doubleclick’s motion to dismiss Allen Brothers’ amended complaint is before

the court. For the following rcasons, the motion is granted in part and denied in part.
Background

The court will not repeat the summary of the facts and applicable standard for a motion to
dismiss from the court’s orders addressing Doubleclick’s motion to dismiss the original
complaint, and will assume {familiarity with these orders. While the allegations as to the injurics
allegedly suffered by Allen Brothers (which were the basis for the dismissal of the original
complaint) have changed, the basic facts remain the same. In a nutshell, Allen Brothers, a
purveyor of fine meats, claims that Doubleclick disclosed confidential information about its
customers to Haute, a competilor, mm violation of the contracts between Allen Brothers and
Doubleclick.

These contracts contained a limitation of liability clause which stated that, “[Allen
Brothers] and [Doubleclick] will not hold each other responsible for any incidental or
consequential damages including but not limited to lost profits, lost data, or lost business that

may anse from this relationship regardless of the cause.” The contracts also contained a choice

Uy



of law provision selecting Colorado law. The motion to dismiss the amended complaint centers
on the limitation of liability clause, as Doubleclick contends that it bars Allen Brothers’ attempt
to hold it liable for the disclosure of Allen Brothers’ information.

Allen Brothers” “Direct Damages” Claims

The court previously found that the limitation of liability clause precluded Allen Brothers
from obtaining relief for lost sales and lost business opportunity. In its amended complaint,
Allen Brothers attempts to avoid this clause by requesting “direct” damages consisting of: (1)
restitution damages resulting from the bencfit Doubleclick derived from using Allen Brothers’
data; (2) damages for the loss in the value of Allen Brothers’ data; (3) all monies paid by Allen
Brothers to Doubleclick under the contracts; and (4) nominal damages.

With respect to restitution damages, Allen Brothcrs asserts that it is entitled to pursue a
claim for damages resulting from the benefit Doubleclick derived from using its data, In support,
it argues that “a breach by non-performance which goes to the essence of the contract” entitles it
to an award “of any benefit which [it] has conferred upon the other party.” Ed Hackstaff
Concrete, Inc. v. Powder Ridge Condominium “A” Owners Assoc., Inc., 679 P.2d 1112, 1114
(Colo Ct. App. 1984). In response, Doubleclick asserts that the restitution claim is really a claim
of unjust enrichment, which must fail as a matter of law because an express contract governs the
same subject matter and the contract is not a product of fraud. See, e.g., Dudding v. Norton
Frickey & Associates, 11 P.3d 441, 445 (Colo. 2000).

In general, “‘a party cannot recover for unjust enrichment by asserting a quasi-contract
when an express contract covers the same subjcct matter because the express contract precludes

any implied-in-law contract.” Interbank Investments, LLC v. Eagle River Water and Sanitation

-2-