Court Opinion

ID: 8623621
Source: CourtListenerOpinion
Date Created: 2022-11-24 11:45:20.845443+00
Date Added: 2024-06-11T16:55:35.268490
License: Public Domain

HOLLOWAY, J.,
concurring in part and dissenting in part:
I concur in Parts III-A-3 and III-B of the Order and Judgment. I dissent from Parts III-A-1 and III-A-2, because I conclude that the district judge erred in granting summary judgment for plaintiff-appellee Student Marketing Group on the counter-claims of defendant-appellant College Partnership, Inc. for breach of contract and negligent misrepresentation. Because I would reverse and remand on this basis and because this would require vacating the award of attorneys’ fees, I do not join Part III-C of the Order and Judgment.
I
On the breach of contract counterclaim, I agree with the majority and with the district judge that the Renewal Agreement is ambiguous on the subject of the number of records that Student Marketing was obligated to provide for the more than 50% increase in price that it was charging over the previous year’s rate. Unlike the majority, however, I believe that resolution of this ambiguity on summary judgment was improper here.
College Partnership paid a flat monthly charge for the first nine months of the term of the renewal agreement and did so without complaint about price, quantity or quality of names. This shows, the majority asserts, that College Partnership was bound to make these monthly payments no matter how many (or how few) names were provided. This is simply a non sequitur, in my view. Indeed, taken at face value, it means that if Student Marketing had decreased the number of names provided from the initial year (say from 7.2 million to 72) instead of increasing the number as promised, College Partnership would still have been obligated to pay at the substantially higher rate called for in the renewal agreement. I think this a patently unreasonable reading of the Renewal Agreement, and yet I see no way that this implication can be avoided consistently with the majority’s interpretation of the contract. And I certainly cannot agree with the conclusion that this result was properly reached via summary judgment, when a much more reasonable construction of the contract is also possible.
Moreover, even if I were to overlook this troubling implication of the majority’s holding, the reasoning is unpersuasive. The majority notes College Partnership’s argument that the monthly payment arrangement only reflects College Partnership’s trust that Student Marketing would in fact provide nine million records before the year was up, followed by the eventual realization that its trust had been misplaced. This, I think, is a reasonable inference and alone should defeat summary judgment.
To rebut this contention, the majority first makes a merely circular argument, stating that the contract did not provide an express commitment for Student Marketing to provide a certain number of names. The original task was to resolve the ambiguity of whether or not the contract called for Student Marketing to provide nine million names, or only up to nine million. In trying to resolve this ambiguity, the majority follows Student Marketing’s suggestion to look at the requirement for payment in fixed amounts. In considering the implications of that requirement, the majority finds that it shows that the promise was only to provide up to nine million names because the contract did not say otherwise.
*106So, in other words, the majority sets out to decide what the ambiguous phrase “up to nine million names” means. But when College Partnership gives one reason why it might mean a minimum of nine million names, the court rejects this possibility because the contract does not expressly require Student Marketing to provide nine million names. This begs the question and so proves nothing at all.
Next, the majority notes evidence that the parties understood that the quantity of names provided would vary from month to month, even though the payments were to be a fixed amount each month. But again, I think that it is a non sequitur to say that this shows that the parties had not agreed that Student Marketing would, by the end of the contract year, provide nine million names. It simply is not the case that the payment arrangement supports only inferences favoring Student Marketing.
In sum, I would reverse the district court’s grant of judgment as a matter of law to Student Marketing on College Partnership’s counterclaim for breach of contract.
II
I would also reverse the district court’s grant of summary judgment to Student Marketing on College Partnership’s counterclaim for negligent misrepresentation. My first point of disagreement with the majority in its analysis of this claim is on the issue whether College Partnership’s negligent misrepresentation claim may be maintained notwithstanding the renewal agreement’s integration clause and limitation on consequential damages. Colorado law applies in this diversity case, and it sets a high standard for contractual language to be effective in barring tort claims.
The leading Colorado case is Keller v. A.O. Smith Harvestore Products, 819 P.2d 69 (Colo.1991). That case held that a negligent misrepresentation claim could be maintained in spite of the contract’s integration clause, which included this language: Buyer relies “on no other promises .... ”
The district court said that the language in the renewal agreement at issue in this case was “similar to the provision in Keller ” and so insufficient to bar a claim for negligent misrepresentation. Without mentioning this ruling by the district judge, the majority reaches the opposite conclusion.
The Renewal Agreement at issue in the present case (as quoted in the majority’s order at 18), includes a statement that the accuracy of information is not guaranteed. Similarly, in Keller, the contract provided that the advertisements, brochures, written and oral statements “are not guarantees .... ” 819 P.2d at 74. The Renewal Agreement in our case contains an integration clause, which the majority quotes and relies upon, that says that the written agreement “supersedes all previous agreements....” In Keller (as already noted and as quoted in the majority’s order) the contract said [Buyer relies] on no other promises.....Id.
The majority also notes that the Renewal Agreement in this case “contains a broad limitation on tort and negligence liability....” But the majority cites no Colorado law regarding the effect of the limitation. More importantly, the majority does not mention the fact that the provision referred to limits consequential but not direct damages, a distinction that the district judge found material, as I do.
The majority unavailingly cites Brooks v. Timberline Tours, 127 F.3d 1273, 1276 (10th Cir.1997), as further support for the holding that the Renewal Agreement effectively bars the negligent misrepresentation claim. But the language in Brooks is much more specific, detailed, and comprehensive than the language at issue here. *107The contract there included an express release of almost any conceivable claim. And in the portion of Brooks that addressed the negligent misrepresentation claim and the reliance on Keller, this court said specifically that although the integration clause did not bar the claim, the release did. 127 F.3d at 1276. I agree with the district court that the release language in Brooks was “more sweeping and specific.” (Again, the majority simply does not mention this holding of the district court, much less attempt to show why it is rejected.)
The majority goes on to hold that Student Marketing would be entitled to summary judgment on the negligent misrepresentation claim on the alternative ground that the 98% accuracy provision of the Renewal Agreement was accompanied by a remedial (refund) provision, which College Partnership had not attempted to employ. Although the refund offer was — to those in the business — transparently worthless because it would cost more to avail oneself of the remedy than would be recouped, the majority nonetheless declares — as a matter of law but without citation of authority — that College Partnership cannot claim to have relied on the representation that the lists would be 98% accurate “while dismissing the refund opportunity underlying the guarantee.”
College Partnership, however, adduced evidence that it did rely on the promise, even though it knew that the refund provision was worthless as a practical matter.15 I am aware of no Colorado law that makes the presence of an illusory contract remedy an affirmative defense to the tort of negligent misrepresentation.
In conclusion, I am persuaded that the district court erred in granting summary judgment on the breach of contract and negligent misrepresentation counterclaims, and I would reverse and remand for the reasons given.

. The district court held that College Partnership's reliance was unreasonable as a matter of law because that court concluded that College Partnership’s own expert, Mr. Hiller, testified that the guarantee taken in its entirety was not misleading and would not be to companies in the industry. I believe that the district court erred by construing ambiguous evidence against College Partnership on summary judgment. Mr. Hiller was asked whether "to anyone in the industry that knows what they are doing, it's not a misleading guarantee, is it?” Mr. Hiller answered "No.” But from the context of the testimony, it is not entirely clear what the witness meant, and this is especially so because Mr. Hiller almost immediately thereafter said, “But the 98 percent is misleading.” III Aplt.App. 821. I believe that the testimony was ambiguous because Mr. Hiller, who was not a lawyer, appears to have been addressing the refund remedy, rather than the guarantee of accuracy, in the portion of his testimony on which the district court relied. But his statement that the promised 98 per cent accuracy was misleading quite clearly addresses and supports the precise point put in issue in the negligent misrepresentation counterclaim. The ambiguity is, to me, sufficiently apparent to require considering that interpretation of the testimony on summary judgment.