Opinion ID: 202756
Heading Depth: 2
Heading Rank: 2

Heading: Unjust Enrichment/Implied Contract

Text: 20 As with the trade secret claim, we review de novo the court's judgment as a matter of law on the implied contract claim, with our review weighted toward preservation of the jury verdict. See Quiles-Quiles, 439 F.3d at 4. 21 The jury found that a contract should be implied in law for the design work that Incase did on the S-5 and awarded Incase $246,261. The court disagreed: 22 Incase put on evidence as to the length of time that it had worked on the design, but there was no evidence as to what those services or products were worth. There was evidence as to what Timex had paid to Yuhing in the Philippines for the product, but I don't think that's a fair measure of the damage to Incase for its design services and prototype services; and I did not see how the jury award matches the evidence. The jury doesn't need perfect information, and its damages awards do not need to be precise as to the penny in this regard, but neither can it speculate or conjecture as to the damages, and I don't see that there was evidence here as to those damages. 23 Initially somewhat confused itself by how the jury reached this particular figure, Incase now points on appeal to what it believes to be the source. It argues that the jury reached its conclusion by multiplying 3,569,000 (the number of S-5 units that Timex purchased from Yuhing) by 6.9 cents—which yields exactly $246,261. The 6.9-cent figure comes from the testimony of Walter G. Frick, the president of Incase. Frick testified that Incase's selling price for the S-5 would have been 14.5 cents per unit, which would have yielded a profit to Incase of 9 cents per unit. During cross-examination, however, Frick essentially conceded that 12.5 cents per unit was a more accurate selling price. Frick testified that, using 12.5 cents rather than 14.5 cents, the profit-per-unit would come out to 6.9 cents rather than 9 cents. The jury appears to have credited this testimony. 24 With the source of the calculation established, we turn to the question of whether that source was proper. Timex argues that this is a lost-profits calculation, when only a value-of-services calculation is appropriate. Under Massachusetts law, a quasi-contract may be implied in law to remedy the unjust enrichment of another party, even where the facts do not necessarily support the existence of an express or implied-in-fact contract. See Bolen v. Paragon Plastics, Inc., 747 F.Supp. 103, 106 (D.Mass.1990); Salamon v. Terra, 394 Mass. 857, 477 N.E.2d 1029, 1031 (1985). In such a case, the proper measure of damages is quantum meruit, or the reasonable value of services provided. See J.A. Sullivan Corp. v. Massachusetts, 397 Mass. 789, 494 N.E.2d 374, 379 (1986); Salamon, 477 N.E.2d at 1031. 25 The question of what [is] fair and reasonable compensation for the services rendered is a question of fact. Guenard v. Burke, 387 Mass. 802, 443 N.E.2d 892, 896 (1982). The jury's award need not be susceptible of calculation with mathematical exactness, provided there is a sufficient foundation for a rational conclusion. Lowrie v. Castle, 225 Mass. 37, 51, 113 N.E. 206 (1916); see Kitner v. CTW Transp., Inc., 53 Mass.App.Ct. 741, 762 N.E.2d 867, 873 (2002). In a case such as this, where the jury cannot estimate the value of the services from common knowledge, the plaintiff must present evidence of the reasonable value of the services to receive anything more than nominal damages. See Hurwitz v. Parkway Country Club, Inc., 343 Mass. 661, 180 N.E.2d 94, 97 (1962); Driscoll v. Bunar, 328 Mass. 398, 103 N.E.2d 809, 813 (1952). However, the damages may not be based only upon lost profits. See J.A. Sullivan Corp., 494 N.E.2d at 379 (The amount of recovery on a claim based in quantum meruit is the fair and reasonable value of material and labor supplied to the benefiting party.); Restatement (Second) of Contracts §§ 344 cmt. a, 371. 26 Instead of presenting evidence of the value of its labor and materials and other costs of creating the design, or of the value of the benefit conferred on Timex, see Slawsby v. Slawsby, 33 Mass.App.Ct. 465, 601 N.E.2d 478, 480 (1992), Incase presented evidence only of the profit it would have had if it had won the S-5 manufacturing contract. Incase's task was admittedly difficult, because of its policy of not charging separately for design services. Instead, it uses these services as sales tools to win manufacturing contracts, expecting to recoup the design costs in the profit from those contracts. But assuming that there is some profit on the manufacturing process itself (and some overall corporate profit), the entire expected contract profits cannot reasonably be said to be equivalent to the value of the design services alone. As difficult as it might have been, Incase was obligated to present at least some evidence, even if not precise, as to the actual value of the services provided.