Court Opinion

ID: 47229
Source: CourtListenerOpinion
Date Created: 2010-04-25 23:19:07+00
Date Added: 2024-06-11T17:17:51.679735
License: Public Domain

[DO NOT PUBLISH]

                IN THE UNITED STATES COURT OF APPEALS
                       FOR THE ELEVENTH CIRCUIT
                                                                              FILED
                          -------------------------------------------U.S. COURT OF APPEALS
                                       No. 05-11045                    ELEVENTH CIRCUIT
                                                                       FEBRUARY 10, 2006
                                 Non-Argument Calendar
                         -------------------------------------------- THOMAS K. KAHN
                                                                             CLERK

                        D.C. Docket No. 04-20409-CV-JLK

UNIVERSITY OF MIAMI,
a not-for-profit Florida corporation,

                                                          Plaintiff-Appellant,

                                           versus

INTUITIVE SURGICAL, INC.,
a Delaware corporation,

                                                          Defendant-Appellee.

               ----------------------------------------------------------------
                    Appeal from the United States District Court
                         for the Southern District of Florida
               ----------------------------------------------------------------

                                   (February 10, 2006)

Before EDMONDSON, Chief Judge, BLACK and PRYOR, Circuit Judges.

PER CURIAM:
      Plaintiff-Appellant University of Miami (“UM”) appeals the district court’s

grant of summary judgment to Defendant Intuitive Systems, Inc. (“Intuitive”),

successor in interest to Computer Motion, Inc. (“CMI”), on UM’s breach of

contract, fraud-based and promissory estoppel claims. No reversible error has

been shown; we affirm.

      UM sought to become a preeminent robotics training center and considered

purchasing one of two available robotic surgical systems: CMI’s “Zeus” system,

and Intuitive’s “da Vinci” system. UM chose the Zeus system because it was less

expensive and smaller.

      In July 2002, CMI submitted to UM its “University of Miami School of

Medicine and Computer Motion Interdependent Relationship Plan” (“Plan”). The

Plan outlined terms for the sale of two Zeus systems to UM and proposed that

CMI function as a long-term partner to UM. UM did not accept the Plan.

      Over the next six months, CMI and UM negotiated about a potential Zeus

sale. On 31 December 2002, CMI and UM executed a Purchase Agreement

(“Agreement”), in which UM agreed to (1) purchase a Zeus system for $695,000

and (2) rent a second Zeus system for six months for one dollar per month, with an

option to purchase the rented Zeus at a reduced price. The Agreement also gave

UM product warranty, service and support for one year on the purchased Zeus and

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an option to purchase additional warranty support. The Agreement said that CMI

and UM would use “good faith efforts” to establish UM as a leading robotics

training center.

       UM rescinded the Agreement one week later, because UM had not complied

with its internal policies for purchases; UM told CMI that it would reconsider the

Agreement through its formal review process. About two weeks later, UM re-

executed the Agreement.

       On 3 March 2003, CMI delivered to UM all of the products contemplated in

the Agreement. UM tested both Zeus systems and determined they were fully

operational, but UM never used the Zeus systems.

        On 6 March 2003, CMI and Intuitive executed a merger agreement.1

Intuitive told both companies’ customers that the merged company’s product

portfolio would include the Zeus system. In July, Intuitive informed UM that

Intuitive would no longer fund research and development for the Zeus system. In

August, Intuitive ended all FDA trials involving Zeus. Intuitive did not seek to

collaborate with UM on Zeus research and development initiatives.

   1
    Intuitive and CMI had, from time to time, discussed the possibility of merger since early 2001
during settlement discussions about patent litigation. In October 2002, CMI rejected Intuitive’s
merger proposal, and all merger discussions ceased. At the time UM entered into the Agreement
with CMI, no merger discussions were taking place.

                                                3
Standard of Review

         We review de novo a district court’s grant of summary judgment. Evanston

Ins. Co. v. Stonewall Surplus Lines Ins. Co., 111 F.3d 852, 858 (11th Cir. 1997).

Breach of Contract

         UM claims Intuitive breached the Agreement by (1) not producing

technological upgrades that would enable the ZEUS to operate with a “seventh

degree of freedom”2 or allow it to be used for urological and cardiac surgery; (2)

not collaborating to establish UM as a leading robotic surgical center; and (3)

delivering an obsolete, rather than cutting-edge, robotic surgical system.

         UM attempts to establish breach with extrinsic evidence about discussions

between UM and CMI, but UM must show that Intuitive violated the actual terms

of the contract because the contract is unambiguous on its face. Under Florida

law, if a written agreement is unambiguous, extrinsic evidence may not be used to

alter its meaning. Carlon, Inc. v. Southland Diversified Co., 381 So. 2d 291, 293

(Fla. Dist. Ct. App. 1980).

         The contract did not require CMI to continue producing the Zeus machine

or technological upgrades. The contract’s terms about product upgrades only

  2
      The “seventh degree of freedom” refers to enhancements in the equipment’s mobility.

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entitled UM to “[a]ll product software upgrades at no charge during the warranty,

service and support term,” and to “[a]ny additional requested hardware upgrades . .

. at 75% of the current US List Price.” UM has not presented evidence that

Intuitive violated these terms.

          UM also produced no evidence that Intuitive failed to collaborate to

establish UM as a robotic surgical training center. UM never requested such

collaboration, and the terms of the contract did not give Intuitive the responsibility

to initiate collaboration.

          UM cannot establish breach by claiming that Intuitive provided an obsolete,

rather than cutting-edge, surgical system. The contract identified specific

equipment that Intuitive would sell and deliver to UM. UM concedes that

Intuitive delivered that equipment.

          Because UM presented no evidence that Intuitive violated the Agreement’s

terms, the district court properly determined that UM’s breach of contract claim

failed.

                                            5
Fraud Claims

      UM alleges several fraud-based claims: constructive fraud, recision, fraud in

the inducement, conspiracy to commit fraud, and a violation of Florida’s

Deceptive and Unfair Trade Practices Act, Fla. Stat. §§ 501.201-313.

       UM alleges that CMI (1) misrepresented the future vitality of Zeus,

including that CMI would upgrade Zeus; (2) secretly deleted a contract provision

about the seventh degree of freedom upgrade before giving UM the Agreement to

sign; and (3) knew when it signed the Agreement that CMI would merge with

Intuitive and that Intuitive would stop producing Zeus machines.

      The district court denied these claims because it determined that no breach

of contract had occurred and that CMI and Intuitive were not planning to merge

when the Agreement was signed.

      The district court properly disposed of the claims. UM freely signed the

Agreement -- twice. The Agreement’s provisions were clearly and unambiguously

stated, and the Agreement did not require CMI to develop technological upgrades

or to continue to manufacture the Zeus. Even if UM officials did not read the

contract before signing it, that act does not excuse UM’s duty to read the

Agreement and know its contents. See, e.g., Jabour v. Calleja, 731 So. 2d 792,

795 (Fla. Dist. Ct. App. 1999).

                                         6
      UM does not establish a genuine issue of material fact about its claim that

CMI knew about the merger and about Zeus’s pending discontinuation when CMI

signed the Agreement. The evidence indicates that Intuitive and CMI had ceased

negotiations by 27 October 2002 and that negotiations did not begin again until 27

January 2003. In addition, Intuitive presented evidence that the decision to stop

producing the Zeus was not made until late June 2003.

      UM’s strongest evidence that might undermine this set of facts is a

statement made by Intuitive’s president that he, after the merger, intended to

eliminate the Zeus machine. But Intuitive did not make the Agreement with UM;

CMI did. UM presents no other evidence to rebut Intuitive’s evidence that the

decision to discontinue Zeus was not made until late June. UM has not done

enough. Therefore, UM’s fraud claims were properly denied.

Promissory Estoppel Claim

      UM contends that promissory estoppel is appropriate here because the

written contract does not include CMI’s assurances about the continued viability

of the ZEUS system nor CMI’s alleged promise to develop future upgrades. The

district court, however, determined that promissory estoppel is improper because

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the Agreement adequately covered -- and omitted -- CMI’s disputed promises. We

agree.

         Promissory estoppel is not available as a remedy when parties have a

written contract addressing the relevant issues; the contract’s silence about

particular details is not controlling as long as the contract purports to address

broadly the disputed issues. See Advanced Mktg. Sys. Corp. v. ZK Yacht Sales,

830 So. 2d 924, 928 (Fla. Dist. Ct. App. 2002) (determining promissory estoppel

was unavailable for claim that yacht broker failed to rebate part of his commission

as promised orally because written contract covered yacht’s sale and broker’s

commission). Here, the Agreement adequately addressed the terms of the sale of

the Zeus systems, including the sale of any product upgrades and the efforts to

establish UM as a robotics training center.

         After reviewing the evidence, we conclude that the district court properly

granted summary judgment to Intuitive on UM’s breach of contract, fraud-based

and promissory estoppel claims.

         AFFIRMED.

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