Court Opinion

ID: 176974
Source: CourtListenerOpinion
Date Created: 2010-10-09 00:05:25+00
Date Added: 2024-06-11T17:25:40.343702
License: Public Domain

FILED
                           NOT FOR PUBLICATION                              OCT 08 2010

                                                                       MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U .S. C O U R T OF APPE ALS

                           FOR THE NINTH CIRCUIT

SUNSTONE BEHAVIORAL HEALTH,                      No. 09-16560
INC.,
                                                 D.C. No. 2:06-cv-02664-FCD-
              Plaintiff - Appellee,              DAD

  v.
                                                 MEMORANDUM *
ALAMEDA COUNTY MEDICAL
CENTER,

              Defendant - Appellant.

                    Appeal from the United States District Court
                       for the Eastern District of California
                    William B. Shubb, District Judge, Presiding

                            Submitted October 6, 2010 **
                             San Francisco, California

Before: BEEZER, KLEINFELD, and GRABER, Circuit Judges.

       Defendant Alameda County Medical Center ("Alameda") appeals from the

entry of judgment in favor of Plaintiff Sunstone Behavioral Health, Inc.,

("Sunstone") following a bench trial. We affirm.

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
        **
             The panel unanimously concludes this case is suitable for decision
without oral argument. Fed. R. App. P. 34(a)(2).
      Reviewing the contract question and the question of law de novo, APL Co.

v. UK Aerosols Ltd., 582 F.3d 947, 951 (9th Cir. 2009), we hold that the district

court correctly held that neither the contract nor California law required that a

Program Manager (also called a Program Director) hold a California license. The

contract provided a detailed list of qualifications for Program Managers and, unlike

for other positions, such as Medical Director of Outpatient Psychiatric Services,

did not include a requirement that they hold a California license.

      The district court’s conclusion that Sunstone’s breach was not material, and

its careful and thorough analysis of that issue, contain no clear error. See JustMed,

Inc. v. Byce, 600 F.3d 1118, 1125 (9th Cir. 2010) ("We review the district court’s

factual findings for clear error."); Whitney Inv. Co. v. Westview Dev. Co. 78 Cal.

Rptr. 302, 307 (Ct. App. 1969) ("Whether a breach is so material as to constitute

cause for the injured party to terminate a contract is ordinarily a question for the

trier of fact."). Accordingly, Alameda’s cancellation of the contract was a material

breach, as the district court correctly found. We also affirm on the district court’s

alternative ground—unchallenged on appeal—that, even assuming Sunstone’s

breach was material, Alameda breached the implied covenant of good faith and fair

dealing.

                                           2
       Even assuming that Alameda preserved its objection to the testimony of

Biggerstaff, the district court did not abuse its discretion in admitting his

testimony. See General Elec. Co. v. Joiner, 522 U.S. 136, 141 (1997) (holding that

"abuse of discretion is the proper standard of review for a district court’s

evidentiary rulings").

       The district court’s calculation of damages contained no clear error. See

Stephens v. City of Vista, 994 F.2d 650, 655 (9th Cir. 1993) ("The district court’s

computation of damages is a finding of fact reviewed under the clearly erroneous

standard."). The district court properly rejected Alameda’s speculation that the

salary of a replacement Program Manager would have been greater than the salary

of its previous Program Manager. The district court’s exclusion of some overhead

costs in its calculation does not rise to the level of clear error, particularly in light

of the court’s use of a value known to be high for other costs. Finally, the district

court’s use of the actual invoices is not clear error because of its correct

determination that Sunstone’s conduct did not constitute a material breach.

       AFFIRMED.

                                             3