HomeMy WebLinkAbout2021-cv-2063-CNS-MEH - City Of Fort Collins V. Open International, Et Al. - 302 - Dfs' Rule 50 Renewed Mot Judgment As A Matter Of Law
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No.: 21-cv-02063-CNS-SBP
CITY OF FORT COLLINS,
Plaintiff/Counterclaim Defendant,
v.
OPEN INTERNATIONAL, LLC,
Defendant/Counterclaim Plaintiff,
and
OPEN INVESTMENTS, LLC,
Defendant.
DEFENDANTS’ RULE 50(b) RENEWED
MOTION FOR JUDGMENT AS A MATTER OF LAW
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Defendant and Counterclaimant Open International, LLC (“Open International”) and
Defendant Open Investments, LLC (“Open Investments” and with Open International,
“Defendants”) hereby renew their motion for judgment as a matter of law under Fed. R. Civ. P.
50(b).1 Judgment should be entered against the City of Fort Collins (“City”) on its fraudulent
inducement claim. The evidence at trial did not support a finding of fraudulent inducement,
which is likewise barred by the economic loss rule, a contractual integration clause, and
unrebutted timeliness and waiver defenses. Additionally, judgment should be entered against the
City and in favor of Defendants on the parties’ dueling contract claims because the evidence
unequivocally showed that the City unlawfully terminated the parties’ contract and thereby
prevented completion of the project. Accordingly, Defendants are entitled to judgment in their
favor on all remaining claims.2
BACKGROUND
The evidence at trial showed that, in February 2018, the City published a request for
proposal (“RFP”) for a software system to support its traditional utilities—water, wastewater,
stormwater, and electricity—and a new broadband service that the City planned to launch. In
1 Because Defendants’ Motion reaches jury issues that that were not resolved by a verdict,
Defendants renew their Rule 50(a) motion now, before judgment but within 28 days after the
jury was discharged.
2 The Court granted judgment as a matter of law against the City on its declaratory judgment
claim, TR (Rough Oct. 30, 2023) at 147:4-9, and on its breach of the implied covenant of good
faith and fair dealing claim, TR (Rough Nov. 2, 2023) at 59:19-60:5, so Defendants do not
reassert their arguments on these claims here. Additionally, because the jury found in favor of
Defendants on the City’s negligent misrepresentation claim, Defendants do not reassert their
arguments as to that claim here. Jury Verdict, Dkt. 296 (Nov. 3, 2023). Because final trial
transcripts are not yet available, Defendants cite the unofficial rough transcripts and will be
happy to supplement with citations to the final transcripts as directed by the Court.
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March 2018, Open International responded, proposing a roughly year-long project—which Open
International warned was an aggressive timeline—to implement its forthcoming 8th-generation
software, called Open Smartflex (“OSF”). Open International explained that OSF version 8.0
was still in development and planned for release later in 2018. The City’s lead negotiator and its
project sponsor both acknowledged OSF’s unreleased, untried, unproven status in May and June
2018. Even so, the City chose Open International, and in August 2018, the parties executed the
Master Professional Services Agreement (the “MPSA”) and the Software License Agreement
(with the MPSA, the “Agreements”), which governed the software implementation project. The
MPSA integrated Open International’s response to the City’s RFP, which included Open
International’s grading of the functionalities in OSF version 8.0 and a proposed schedule for the
implementation of OSF. As part of the MPSA, Open Investments guaranteed Open
International’s performance of the Agreements.
The City presented evidence at trial that project delays arose because OSF version 8.0 did
not have the functionalities promised in Open International’s response to the RFP, and,
regardless, the project timeline in the RFP response was unrealistically aggressive. The
unrebutted evidence showed, however, that with full awareness of these issues the City executed
the First Amendment to the MPSA, which assigned the majority of delay costs to the City and
extended the project. Later, the parties also executed a project change request, titled “PCR 29,”
which created new project deadlines and extended the Parties’ relationship further.
About six months after PCR 29, on May 19, 2021, Open International sent the City a
notice of default under the Agreements and PCR 29 and identified what the City needed to do for
the project to succeed. A week later, rather than addressing the notice of default or attempting to
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cure its defaults, the City unlawfully terminated the Agreements without giving the required 30
days’ notice or an opportunity to cure. Even though the City sent this letter purporting to
terminate the Agreements and threatening to rescind them based on the assertion that Open
International had fraudulently induced the Agreements back in 2021, the City continued to work
on the project with Open International for over a month, used OSF for several months after that,
and asked Open International to propose a project reset plan under which Open International
would assume more responsibilities. The City then sued Defendants for fraudulently inducing
the City into signing the Agreements more than three years earlier and for breaching the
Agreements.
After a nine-day jury trial, the jury returned a verdict in favor of the City on its claim for
fraudulent inducement, despite finding that the City had waived its parallel claim for negligent
misrepresentation. Based on the verdict, the City elected to rescind the Agreements, thus
severing the sole link of obligation between Open Investments and the City.
LEGAL STANDARD
A party is entitled to judgment as a matter of law under Rule 50(b) where the “evidence
points but one way and is susceptible to no reasonable inferences supporting the party opposing
the motion.” Riske v. King Soopers, 366 F.3d 1085, 1091 (10th Cir. 2004) (quotation and
citation omitted). The Court is “not required to evaluate every conceivable inference which can
be drawn from evidentiary matter, but only reasonable ones.” Lucas v. Dover Corp., 857 F.2d
1397, 1401 (10th Cir. 1988) (quotation omitted). “The court should disregard any jury
determination for which there is no legally sufficient evidentiary basis enabling a reasonable jury
to make it.” Powell v. Fournet, 846 F. Supp. 1443, 1445 (D. Colo. 1994).
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ARGUMENT
I. JUDGMENT SHOULD BE ENTERED AGAINST THE CITY ON ITS
FRAUDULENT INDUCEMENT CLAIM.
The evidence at trial did not show that Defendants misrepresented then-existing or past
material facts, that the City justifiably relied on any supposed misrepresentations, or that
Defendants intended the City to rely on a known misrepresentation. See CJI-Civ. 19:1 (2023).
Moreover, the economic loss rule, the Agreements’ integration clause, and the defenses of
timeliness and waiver bar a fraudulent inducement claim.3
A. The City Presented No Evidence of a Misrepresentation of a Then-Existing
or Past Fact by Open International, Let Alone by Open Investments.
The Court should enter judgment as a matter of law on the City’s fraudulent inducement
claim because there was no evidence of a misrepresentation of material fact. It is a black-letter
“element of fraud . . . that the misrepresentation relied on must be of an existing or past material
fact,” United Fire & Cas. Co. v. Nissan Motor Corp., 433 P.2d 769, 771 (Colo. 1967), so a
misrepresentation cannot be “a matter of intention, or . . . an unfulfilled promise to perform an
act,” nor may it address “something to be done in the future,” People v. Orris, 121 P. 163, 164
(Colo. 1912) (quotation and citation omitted), or an opinion or belief, see Steak N Shake Enters.
v. Globex Co., LLC, 110 F. Supp. 3d 1057, 1083 (D. Colo. 2015).
3 Regarding legal fraud damages, the Court held that, if the City chose to affirm the Agreements,
any damages for its fraudulent inducement or negligent misrepresentation claims are capped by
the limitations clause in the MPSA. TR (Rough Nov. 2, 2023) at 13:16-14:15. Accordingly and
because the City elected rescission, Defendants do not renew their Rule 50(a) argument on the
application of the damages limitation to the City’s tort claims, although they maintain that no
legal damages whatsoever arising from misrepresentations—as distinct from legal damages for
breach of contract or the measure of a monetary award for rescission based on
misrepresentations—were ever pleaded, disclosed, or shown by evidence at trial.
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Throughout this case and during trial, the City asserted that Open International’s RFP
response misrepresented OSF and Open International’s ability to timely complete the project.
But the City failed to present any evidence of a representation that Open International or Open
Investments made of an existing or past fact. Rather, the City challenged only Open
International’s promises to perform in the future—promises that no jury could find are
misrepresentations of then-existing or past facts.
Nothing in the RFP requested a vendor to grade its then-existing software; rather, for
items graded as A and B, the functional matrix instructions required those functionalities to be
delivered by go-live. Ex. 23 at 18. This is consistent with the City’s own witnesses’
understanding of the RFP and Open International’s response. Colman Keane, director of the
City’s broadband utility, testified that functionalities graded “A” in the RFP response were
functionalities that the City expected would be ready in OSF “when it was delivered”—not at the
outset of the project. TR (Rough Oct. 24, 2023) at 146:14-147:1; accord id. at 110:6-13
(testifying that something graded A “would be available out of the box when [Open
International] delivered the product”).
Moreover, Open International could not grade then-released software because it did not
have any released software for the U.S. market. Open International explained that to the City
throughout its response to the RFP. Ex. 5 at 55, 312, 998. In particular, the RFP response
explained that “the next version currently in development is release 8.0.0 and is planned for Q2
2018”—months after the RFP response. Id. at 312 (emphasis added). Then, for each and every
functionality in the functional matrix, Open International disclosed that the “Version” of OSF
being graded was “8.0.” Id. at 507-784. Open graded a future release to be delivered later.
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As to Open International’s statements about the project timeline, these were expressly a
matter of belief, also about future performance. Ex. 5 at 20 (“Open believes that the Fort Collins
timeframe . . . is aggressive, but realistic and achievable based on our prior CIS/OSS
deployments.” (emphasis added)). They were not representations of existing fact, and thus could
not support fraud.
As to Open Investments, even more starkly, the evidence falls short of an actionable
misrepresentation. Open International delivered the RFP response, not Open Investments. Ex. 5
at 8-9. The sole evidence of Open Investments’ involvement in this case was its execution of the
guarantee of the Agreements. Ex. 1 at 4; TR (Rough Oct. 24, 2023) at 14:10-15:2 (City’s lead
negotiator explaining Open Investments’ role as contractual guarantor); TR (Rough Nov. 1,
2023) at 65:4-7, 142:15-143:5 (Mr. Corredor testifying to Open Investments’ role as guarantor of
Open International contract obligations); see also Ex. 66 (accusing only Open International of
breach and fraud); Compl. (Dkt. 1) ¶¶ 5-6 (asserting entitlement only to “enforcement” against
Open Investments); Am. Compl. (Dkt. 192) ¶¶ 5-6 (same). There is no evidence to support a
finding that Open Investments made any precontractual representations at all, let alone material
misrepresentations of fact. Thus, when the City elected to rescind the Agreements, which
included Open Investments’ guarantee, the City disclaimed the lone basis on which Open
Investments might have been liable. As the Court held, the City “can’t piece apart the contract”
through partial rescission. TR (Rough Nov. 2, 2023) at 14:1-5. Thus, rescission eliminated the
only means by which the City could have forced Open Investments to backstop Open
International’s obligations, based either on a breach of contract finding or on an election to
affirm and enforce the Agreements, including the guarantee, after a fraudulent inducement
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finding. There is no evidence of any misrepresentation by Open Investments, and there is no
longer any evidence of an obligation of Open Investments to backstop Open International based
on any misrepresentation by Open International.4
For these reasons, judgment should be entered in favor of Defendants and against the
City on its claim of fraudulent inducement. That is doubly true as to Open Investments.
B. The Evidence Showed that the City Did Not Justifiably Rely on Any
Misrepresentations by Defendants.
In addition to a misrepresentation of existing fact, the City also had to prove it was
justified in relying on that misrepresentation. But the City offered no evidence to support a
finding of justifiable reliance on the timeline in the RFP response when the parties negotiated a
different timeline in the Agreement, or justifiable reliance on the notion that Open had graded
already-released, in-use software when the City knew that was not true. As to the status of
Open’s software, the City’s lead negotiator for the Agreements, Mike Beckstead, testified he
knew that OSF version 8.0 was unproven, untried, and unreleased when he entered into contract
negotiations with Open International, and the City would be the “beta” customer. TR (Rough
Oct. 24, 2023) at 13:6-16, 57:4-19, 71:5-7. Likewise, internal City due diligence documents
circulated by the City’s project sponsor, Lisa Rosintoski, acknowledged that the City would be
the first install for unreleased OSF version 8. See Ex. 439 at 4-5; Ex. 473 at 6; Ex. 5 at 998.
Internal City documents from June 2018 also acknowledged that part of the “unique value
4 Separate from the issue of Open Investments’ liability, Defendants moved orally on November
17, 2023 to dismiss Open Investments under Rule 52(c) in light of the City’s election to rescind
because that remedy is not available against Open Investments. Defendants will brief that issue
in the rescission briefing ordered by the Court, but in short, in addition to a lack of evidence to
support a finding of liability for fraudulent inducement against Open Investments, the City never
conferred any contractual benefit on Open Investments that can be disgorged through rescission.
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proposition” of the project was related to “[e]arly adoption/testing of new functionality” with
Open International. Ex. 459 at 4. In short, being the first customer for an untested, unreleased
version of OSF was a risk that the City knew and accepted. There is no evidence the City
justifiably relied on any misrepresentation by Open International (or that Open Investments made
any representations that were relied on).
C. There Is No Evidence to Support a Finding that Defendants Lied with the
Intent to Induce the City’s Reliance.
For similar reasons, there is no evidence to support a finding that Defendants knew that
any representations to the City were untrue or intended to induce the City to rely on false
representations. As noted above, Open International’s RFP response disclosed the true facts that
OSF version 8.0 was in development and would be released in the future. Ex. 5 at 55, 312, 998.
Hernando Parrott likewise gave unrebutted testimony that—both before the RFP was issued and
during the vendor-selection process—he told City leaders Ms. Rosintoski and Mr. Keane, among
others, that OSF Version 8.0 was being proposed but was still unreleased. TR (Rough Oct. 30,
2023) at 167:6-169:22. No reasonable jury could conclude that Defendants knowingly misled
the City with intent to induce reliance when, in fact, Open International disclosed the truth (and
Open Investments disclosed nothing either way). As such, judgment should enter in favor of
Defendants and against the City on its fraudulent inducement claim.
D. The Economic Loss Rule and Integration Clause Bar the City’s Fraudulent
Inducement Claim Based on Open International’s Proposal.
In addition to its failure to adduce evidence to support the merits of its claims, the City
failed to provide evidence of alleged misrepresentations that were not subsumed by the
Agreements. Even if a tort duty exists independent of the contract, and “even if the duty would
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be imposed in the absence of a contract, it is not independent of a contract that ‘memorialize[s]’
it.” Haynes Trane Serv. Agency v. Am. Std., Inc., 573 F.3d 947, 962-63 (10th Cir. 2009). Here,
the City contends that Defendants fraudulently induced the City to sign the Agreements by
misrepresenting facts in the RFP response. TR (Rough Oct. 23, 2023) at 98:3-100:21, 102:8-10;
TR (Rough Nov. 2, 2023) at 73:17-20. But the RFP response was wholly “incorporated . . . by
reference” in the Agreements and imposed as a contractual requirement. See Ex. 1 at 5; see also
id. at 88-365 (functional matrix); id. at 366-70 (changes to functional matrix). Likewise, the
project schedule was incorporated into the MPSA. Ex. 1 at 51-52. Because Open International’s
alleged misrepresentations were “memorialized” in the Agreements as express obligations, they
are not “independent of” the Agreements and cannot substantiate a fraud claim under the
economic loss rule. Haynes, 573 F.3d at 962-63; see also Gilbert Unif. Sch. Dist. v. CrossPointe,
LLC, 2012 U.S. Dist. LEXIS 61254, at *11 (D. Ariz. May 2, 2012) (barring fraud claim because,
“[e]ven if the statements were false, they are incorporated into the [agreement] as contractual
promises for which there are contractual remedies if breached”); 1055 Inv. LLC v. 1055 E. 45th
Ave. II LLC, 2018 Colo. Dist. LEXIS 4697, at *20-23 (Denver Dist. Nov. 2, 2018) (applying
economic loss rule to pre-contract misrepresentations covered by contract).
Moreover, the MSPA contains the following integration clause: “This Agreement,
including all Exhibits, constitutes the final, complete and exclusive agreement between the
Parties with respect to the subject matter of this Agreement, and supersedes any prior or
contemporaneous agreement, proposal, warranties and representations.” Ex. 1 at 18 § 18.15
(emphasis added). And, as noted, the Agreements likewise incorporate the RFP response by
reference and the functional matrix responses directly. Given the Agreements’ incorporation of
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the RFP response as a contract duty and the disclaimer of pre-contract representations and
proposals, there is no evidence of an actionable misrepresentation. See Steak N Shake Enters.,
110 F. Supp. at 1082-83 (holding integration and no-representation clauses in contract foreclosed
fraudulent inducement claim). Thus, the Agreements’ integration clause also bars the City’s
fraudulent inducement claim.
E. The City’s Fraudulent Inducement Claim Was Untimely and Was Waived.
Under C.R.S. § 13-80-101(1)(c), the statute of limitations for the City’s fraudulent
inducement claim was three years, and the unrebutted evidence at trial showed that the City
knew or should have known about any factual misrepresentation regarding Open International’s
proposal more than three years before the City filed suit on July 2, 2021. Open International
submitted its RFP response in March 2018, and after multiple demonstrations of the product, as
noted above, internal City documents from May and June 2018 acknowledged that the City
would be the first install of OSF version 8.0 and that part of the City’s “unique value
proposition” was related to “[e]arly adoption/testing of new functionality” in that product. Ex.
439 at 4-5; Ex. 473 at 6; Ex. 459 at 4. Further, the City’s lead negotiator of the Agreement,
Mr. Beckstead, confirmed he knew before July 2018 that OSF version 8.0 was an unproven,
untried, and unreleased product. TR (Rough Oct. 24, 2023) at 13:6-16, 57:4-19; 71:5-7. For
these reasons, the statute of limitations bars the City’s fraudulent inducement claim.
Moreover, waiver of fraudulent inducement arises when “the defrauded party, with full
knowledge of the truth respecting the false representations, elect[s] to continue to carry out the
agreement.” Holland Furnace Co. v. Robson, 402 P.2d 628, 630-31 (Colo. 1965). The evidence
at trial showed that the City listed in detail in late 2019 and early 2020 the very issues it
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complained of in this case. By then, the City had claimed that the portal it received was not
satisfactory and was not the portal represented during vendor-selection workshops or in Open
International’s RFP response. See Ex. 219 at 1; Ex. 464 at 3. It had claimed by then that Open
International was engaged in a “development project,” rather than the implementation of an out-
of-the-box system, due to functional deficiencies with OSF; OSF was not ready for the North
American market; and only 58% of OSF functionality was delivered by Open when broadband
went live. See Ex. 76 at 1-2; Ex. 529 at 3, 6; Ex. 479 at 1. And the City claimed by then that the
contracted schedule for the implementation of OSF had been “exceptionally aggressive” and
unachievable. Ex. 720 at 8:00-8:45 (June 2, 2020 City executive testimony to City Council in
support of First Amendment). There is no evidence of a single fact supporting the City’s fraud
claim that the City did not know about by spring 2020. But the City nevertheless executed the
First Amendment with Open International in June 2020, Ex. 14, and then executed PCR 29, Ex.
6, both of which extended the project and assigned responsibility for additional costs to the City.
Several of the City’s witnesses, including City project manager Michelle Frey, whose “eyes were
opened” to Open International’s supposed misrepresentations by spring 2020, testified that the
City did not have to continue with the relationship; it could have, at any moment, stopped the
project with Open International and completed the work with a different vendor. TR (Rough
Oct. 24, 2023) at 222:11-223:5; TR (Rough Oct. 26, 2023) at 44:17-45:1. But it didn’t.
Further, even after the City sent Open International the notice of termination letter in
May 2021, Ex. 66, the City continued to work on the project. Aaron McClune, the City’s final
project manager, testified that work on the project with Open International continued until July 2,
2021—over a month after the City sent its letter claiming fraud. TR (Rough Oct. 27, 2023) at
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49:14-18. Travis Storin, the City’s CFO, gave the same account and noted that the City
continued using its OSF license from the Agreements to continue operating OSF for months after
the City filed suit for fraud. TR (Rough Oct. 23, 2023) at 205:25-206:25 (testifying that City
learned no new facts between Open International’s notice of default and City’s filing of fraud
claim seven weeks later). Repeatedly, despite knowing the bases of its present fraud claim, the
City continued with—and extended—the Agreements, thereby waiving any claim of fraudulent
inducement.5
II. JUDGMENT SHOULD ENTER AS A MATTER OF LAW AGAINST THE CITY
AND IN FAVOR OF DEFENDANTS ON THE DUELING CONTRACT CLAIMS.
If the Court enters judgment against the City on its fraudulent inducement claim, the
Court should likewise enter judgment against the City and in favor of Defendants on the parties’
dueling contract claims, which may be resolved as a matter of law without a new trial. The
City’s contract claim is barred, even if the City had not precluded its own recovery by electing to
rescind the Agreements, because the City terminated prematurely without the required notice-
and-cure opportunities, which were conditions precedent to the City’s contract claim. Nw. Water
Corp. v. Westminster, 432 P.2d 757, 758-60 (Colo. 1967). The City’s termination letter did not
identify any means to cure or provide an opportunity to cure any alleged breach of the
5 Separately, Defendants argued in their Rule 50(a) motion that the City waived its right to the
remedy of rescission. Waiver of the rescission remedy implicates a different test than waiver of
liability for fraudulent inducement, and rescission may be waived even if the underlying claim is
not waived. See Elk River Assocs. v. Huskin, 691 P.2d 1148, 1153 (Colo. App. 1984) (observing
that, irrespective of whether the plaintiff waived the fraud claim based on “full knowledge of the
truth,” the remedy of rescission might still be waived); Gladden v. Guyer, 426 P.2d 953, 955
(Colo. 1967) (explaining that full knowledge is not required to waive rescission). Because the
Court did not instruct the jury on rescission and reserved for itself the resolution of remedial
issues if the City elected rescission, Defendants will address waiver of the rescission remedy in
briefing ordered by the Court as part of the remedial phase of the case that was tried to the bench.
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Agreements, as required. Ex. 1 at 12; Ex. 66. Indeed, Mr. Storin testified that the City did not
provide any notice of default or opportunity to cure prior to sending its May 28, 2021 notice of
termination, and he testified that the City did not follow the MPSA’s termination provisions. TR
(Rough Oct. 23, 2023) at 196:6-8, 250:7-13.
While futility is not an exception under the provisions of the contract or an excuse for
failing to provide pre-termination notice, see Ex. 1 at 12; Carleno Coal Sales, Inc. v. Ramsay
Coal Co., 270 P.2d 755, 756-58 (Colo. 1954) (enforcing pre-termination notice and cure
provisions despite terminating party’s assertion that counterparty “refus[ed] to perform”), no
futility was shown because the City did not present evidence of any specific contractual
obligation that Defendants could not or would not perform. Indeed, Mr. Storin admitted that,
after sending the notice of termination letter, the City wanted and expected Open International to
provide a proposal to the City that would have completed the project, which the City believed
was possible, so the City continued working with Open. TR (Rough Oct. 23, 2023) at 205:25-
206:25, 254:6-17. Mr. McClune, the City’s final project manager, also testified that the parties
continued to work on the project in the month following the City’s letter and that he thought the
project could succeed with Open International. TR (Rough Oct. 27, 2023) at 47:22-48:14. Cure
was not futile. Accordingly, because of the City’s premature termination of the MPSA in
contravention of the MPSA’s termination clauses, no jury could find for the City on its breach of
contract claim against Defendants.
For the same reasons, Open International is entitled to judgment on its contract claim
against the City. See Nw. Water, 432 P.2d at 760-61; Carleno, 270 P.2d at 758. Because the
evidence showed that the City did not follow the MPSA’s notice-and-cure provisions, and that it
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would not have been futile for the City to follow those provisions, judgment should enter in
favor of Open International on its breach of contract claim against the City.
Even without disposing of the City’s contract claim based on the City’s violation of the
MPSA’s termination provisions, the City also waived its contract claim. “Waiver arises when a
contractual party is entitled to assert a right, knows the right exists, and intentionally abandons
that right.” Bd. of Cty. Comm’rs v. City & Cty. of Denver, 511 P.3d 692, 702 (Colo. App. 2022).
For the same reasons articulated above regarding waiver of the City’s fraudulent inducement
claim, the evidence showed the City’s waiver of its breach of contract claim, so judgment should
enter against the City on its breach of contract claim.
III. JUDGMENT SHOULD BE ENTERED AGAINST THE CITY ON ITS
MITIGATION OF DAMAGES DEFENSE.
Defendants renew their oral Rule 50(a) motion for judgment against the City on its
mitigation of damages defense. TR (Rough Nov. 2, 2023) at 55:11-19. The Court decided to
instruct the jury that it could find a mitigation defense in favor of the City only if the City proved
Open International “failed to cease the project after it concluded it would not complete the
project” and incurred “increased damages because it did not cease the project after it concluded it
would not complete the project.” Citing CJI-Civ. 5.2. The City presented no evidence that Open
International ever concluded it would not complete the project, let alone evidence of any
damages Open International claimed that arose after it reached such a conclusion. Rather, the
City argued that Open International failed to mitigate by not disclosing a risk register from 2018,
by not adequately supporting Open International’s project manager Dwayne Bishop in 2018 and
2019, and by moving forward with the Milestone portal in 2019. TR (Rough Nov. 2, 2023) at
56:20-57:3. These cited events or failures from 2018 and 2019, even viewed in the light most
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favorable to the City, are inapplicable to the City’s failure to mitigate defense, which could turn
only on damages incurred after Open International concluded it would not complete the project.
The Court should enter judgment against the City on its mitigation of damages defense.6
CONCLUSION
For the foregoing reasons, Defendants respectfully request that the Court enter judgment
in their favor on all remaining claims and enter judgment against the City on its mitigation
defense.
Dated: December 1, 2023 Respectfully submitted,
s/ Paul D. Swanson
Paul D. Swanson, pdswanson@hollandhart.com
Kevin C. McAdam, kcmcadam@hollandhart.com
Alexander D. White, adwhite@hollandhart.com
Alexandria E. Pierce, aepierce@hollandhart.com
Holland & Hart LLP
555 17th Street, Suite 3200
Denver, Colorado 80202
Telephone: 303-295-8000
Attorneys for Open International, LLC and Open
Investments, LLC
6 During trial, Open maintained its objections to the Court’s decision not to require a pre-trial
election of remedies but also sought a mitigating ruling to require election before the case was
submitted to the jury. Open maintains that the failure to require a pretrial election was
prejudicial error but intends to raise the issue as part of its post-judgment motion under Rule 59
rather than in this Rule 50 Motion.
Case No. 1:21-cv-02063-CNS-SBP Document 302 filed 12/01/23 USDC Colorado pg 16 of
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CERTIFICATE OF SERVICE
I hereby certify that on the 1st day of December, 2023, the foregoing was electronically
filed with the Clerk of Court using the Court’s electronic filing system and that a copy of the
foregoing was sent to all counsel of record via same in compliance with the Federal Rules of
Civil Procedure and the Local Rules of this Court.
s/ Paul D. Swanson
30907226
Case No. 1:21-cv-02063-CNS-SBP Document 302 filed 12/01/23 USDC Colorado pg 17 of
17