Opinion
4:18-CV-3167
2021-06-28
SENIOR HOUSING MANAGERS, LLC, an Oregon limited liability company, Plaintiff and Counterclaim Defendant, v. HIGHWAY 2 DEVELOPMENT, LLC, d/b/a Pemberly Place, a Nebraska limited liability company, Defendant and Counterclaimant.
Brian T. McKernan, Maryl C. Sattler, McGrath, North Law Firm, Omaha, NE, for Plaintiff and Counterclaim Defendant. Audrey R. Svane, Craig C. Dirrim, Woods, Aitken Law Firm, Lincoln, NE, for Defendant and Counterclaimant.
Brian T. McKernan, Maryl C. Sattler, McGrath, North Law Firm, Omaha, NE, for Plaintiff and Counterclaim Defendant.
Audrey R. Svane, Craig C. Dirrim, Woods, Aitken Law Firm, Lincoln, NE, for Defendant and Counterclaimant.
MEMORANDUM AND ORDER
John M. Gerrard, Chief United States District Judge
This dispute involves the construction and management of an assisted living center in Lincoln, Nebraska. The defendant, Highway 2 Development, LLC, contracted with the plaintiff, Senior Housing Managers, LLC, to provide certain management and oversight services during the construction, opening, and operation of Pemberly Place, a new assisted living facility owned and operated by Highway 2.
Highway 2 terminated the parties’ Management Services Agreement (filing 1-1), and Senior Housing sued alleging breach of contract, violation of the Nebraska Uniform Deceptive Trade Practices Act (UDTPA), and "unfair competition and unjust enrichment." Filing 1. Highway 2 counterclaimed alleging contract, tort, and statutory claims related to actions taken by Senior Housing during the construction and opening of Pemberly Place. Filing 13. The Court partially granted Senior Housing's motion to dismiss Highway 2's counterclaim but allowed Highway 2's claims for (1) breach of contract, (2) breach of the implied covenant of good faith and fair dealing, (3) negligent misrepresentation, and (4) unjust enrichment to proceed. Filing 33.
The parties have now filed cross-motions for partial summary judgment. Senior Housing moves for summary judgment on the issue of liability for its breach of contract claim, and on all of Highway 2's remaining counterclaims. Filing 61. Highway 2 moves for summary judgment on Senior Housing's UDTPA and unjust enrichment claims, and on Senior Housing's claim for unfair competition damages under each of its theories of recovery. Filing 59. For the reasons set forth below, Senior Housing's motion will be granted in part and denied in part and Highway 2's motion will be granted.
I. STANDARD OF REVIEW
Summary judgment is proper if the movant shows that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law. See Fed. R. Civ. P. 56(a). The movant bears the initial responsibility of informing the Court of the basis for the motion, and must identify those portions of the record which the movant believes demonstrate the absence of a genuine issue of material fact. Torgerson v. City of Rochester , 643 F.3d 1031, 1042 (8th Cir. 2011) (en banc). If the movant does so, the nonmovant must respond by submitting evidentiary materials that set out specific facts showing that there is a genuine issue for trial. Id.
On a motion for summary judgment, facts must be viewed in the light most favorable to the nonmoving party only if there is a genuine dispute as to those facts. Id. Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the evidence are jury functions, not those of a judge. Id. But the nonmovant must do more than simply show that there is some metaphysical doubt as to the material facts. Id. In order to show that disputed facts are material, the party opposing summary judgment must cite to the relevant substantive law in identifying facts that might affect the outcome of the suit. Quinn v. St. Louis Cty. , 653 F.3d 745, 751 (8th Cir. 2011). The mere existence of a scintilla of evidence in support of the nonmovant's position will be insufficient; there must be evidence on which the jury could conceivably find for the nonmovant. Barber v. C1 Truck Driver Training, LLC , 656 F.3d 782, 791-92 (8th Cir. 2011). Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for trial. Torgerson , 643 F.3d at 1042.
II. BACKGROUND
Senior Housing is an Oregon business specializing in the development, operation, management and marketing of senior living facilities. See generally filing 13; see also filing 1-3 at 5. Christian Mason is the President and CEO of Senior Housing and was its designated representative under the Management Agreement. Filing 13 at 6; filing 1-1 at 1. Highway 2 is a Nebraska real estate development company. See filing 68-3 at 3-4. Monte Froehlich and his wife are the final decision makers for Highway 2, but work with a team of professionals. Filing 68-3 at 4. Jessica Lindersmith is Highway 2's VP of Operations and its designated representative under the Management Agreement. See filing 1-1 at 2. Lindersmith and Colin Mues, in-house counsel, were most involved in the Pemberly Place project. Filing 68-3 at 4.
Senior Housing and Highway 2 began talking sometime in 2014 or 2015. See filing 68-3 at 14-15; filing 13 at 7. Froehlich testified that he knew Senior Housing's marketing director, Bob Zink, from "the real estate world," and approached Zink about developing a site in Lincoln for senior living. Filing 68-3 at 13-15. And Froehlich testified that Senior Housing represented "they knew how to design, build, [and] operate a high-end senior living community in Lincoln, Nebraska," and that an attached medical clinic "would be a great profit center and should bring in a million dollars a year in profit [alone]." Filing 68-3 at 13-14. That "sounded great" to Froehlich, and the relationship was off and running. See filing 68-3 at 15.
The first communication in the record between the parties is an August 25, 2015 email from Mason to Froehlich with an attached "draft version of a 120 unit mixed care community." Filing 70-19. Mason described the draft as his "best guess at [that] point what it would cost to put a project like this in the ground," and included "all architectural, engineering, site work (offsite and on site), furniture, fixtures, and equipment and all other related costs." Filing 70-19 at 1. Mason was also arranging a visit to Lincoln to meet with Froehlich and "tour[ ] other competitors in the area ... to confirm many of [his] assumptions." Id. And a November 18, 2015 e-mail from Mason attached a "project overview" that "outline[d] the project to be built and [gave] guidelines for the architects to help keep the project on scope." Filing 70-20. The project overview was updated in March 2016. See filing 68-8; filing 68-6 at 3-4.
The parties both eventually retained counsel to negotiate a formal agreement, see filing 64-1 at 5-7, and executed the Management Agreement on October 21, 2016—the only written contract between the parties. Filing 1-1; see also filing 62 at 3; filing 67 at 1-2. It was effective beginning January 1, 2017 and had a term of five years. Filing 1-1 at 1, 7. No written modifications have been made to the Agreement, filing 62 at 3; filing 67 at 2, and the parties agree that their oral agreements were all made prior to execution of the Management Agreement, which contains an integration clause, filing 62 at 4, filing 67 at 2; see filing 1-1 at 10. Much of this dispute stems from the parties’ conflicting interpretations of the Management Agreement.
There is a blank "Schedule A – Other Services" attached to the Management Agreement but the parties never modified Schedule A to list any "other services." Filing 64-1 at 8.
Under the Management Agreement, Senior Housing had sweeping authority over personnel, regulatory compliance, operation and admissions policies, financial management, selection of legal counsel, facility maintenance, and marketing. Filing 1-1 at 2-5. In exchange for Senior Housing's services, Highway 2 agreed to pay Senior Housing a management fee. Filing 1-1 at 9. Senior Housing contends that its only contractual obligations were to manage Pemberly Place once fully operational, and that Highway 2 alone was responsible for developing the property. Filing 62 at 12-13. And Senior Housing generally denies that it breached any of its obligations under the Management Agreement. Filing 62 at 11-17.
Highway 2 has a very different view. It contends that "the plain language of the [Management Agreement] and the understanding of the parties was that Senior Housing would act as an advisor to Highway 2 throughout the construction phase and during the term of the [Agreement]." Filing 67 at 4. Moreover, Highway 2 asserts that in addition to the duties explicitly listed in the Management Agreement, Senior Housing took on additional duties and responsibilities. Id.
Froehlich testified that Mason helped select the architect and general contractor. Filing 68-3 at 4-6. Lindersmith testified that Mason participated on "almost every call with the architect in the predesign planning phase," and helped make design decisions. Filing 68-4 at 3-4. She also testified that Highway 2 entered into the relationship "with the understanding that [Senior Housing] were the experts and that they would be helping us through the process of construction and management," which was reflected in the Management Agreement in part through a "construction period fee" paid to Senior Housing. Filing 68-4 at 11. And Lindersmith testified Highway 2 delegated certain design decisions to Senior Housing during construction. See filing 68-4 at 5-8.
Section 8.1.2 of the Management Agreement requires a monthly fee of $7,500 be paid to Senior Housing during the "construction period," further defined as between January 1, 2017 and the date Pemberly Place was issued a certificate of occupancy. Filing 1-1 at 9.
Mason testified that Senior Housing was involved in an advisory capacity during the construction phase to "support [Lindersmith] as the project manager, to assist her as needed, and to help where we could to get a better product so that when [Senior Housing] took over as managers of the building, we could make it successful." Filing 68-6 at 5. According to Mason, the construction period fee was paid "to ramp up the management side" while Pemberly Place was being built, including "learning the licensing rules and regulations," "setting up systems," "hiring people," and "building relationships." Filing 68-6 at 5.
Highway 2 claims that it began to discover problems with the project in December 2016. Filing 67 at 5. For example, the hallways were not wide enough to allow two or more wheelchairs to simultaneously pass through. Filing 67 at 5; filing 68-5 at 8. Highway 2 also claims that Senior Housing wrongly suggested a whirlpool room was unnecessary and failed to recommend outdoor space—"two amenities that are common industry standards in the metro [Lincoln] area." Filing 67 at 5; see filing 68-5 at 7, 9. And according to Highway 2, Senior Housing failed to include an additional "med room" in the final design, as required by regulation. Filing 67 at 5; filing 68-4 at 9.
In April 2018, two to four weeks before Pemberly Place was scheduled to open, Highway 2 says it discovered additional problems it attributes to Senior Housing. See filing 67 at 6. According to Highway 2, the technology to manage the wireless nurse call station, security system, and access to resident room doors was all inoperative. Filing 67 at 6, see filing 68-3 at 9; filing 68-4 at 14; filing 68-6 at 6-7. And Highway 2 found that the kitchen appliances ordered by Senior Housing did not have matching finishes. See filing 68-6 at 6.
Highway 2 also claims it noticed the absence of procedures and operational software necessary to open Pemberly Place in late April 2018. See filing 67 at 6-7. Helen Crunk, Executive Director at Pemberly Place, testified that no fee structure, billing system, or operational policies and procedures were in place. Filing 68-5 at 3-4. Crunk further testified that the software used for documenting clinical services, marketing, and financial management had not been set up. See filing 68-5 at 13-14. And only two independent living units had been "potentially" pre-leased, but otherwise no residents were contracted to move in. See filing 68-5 at 13-14. Crunk communicated her concerns to Froehlich, Lindersmith and Mues at a meeting on April 24. Filing 68-5 at 3; filing 68-3 at 8.
The next day, Froehlich sent an email to his wife, Lindersmith, Mues, and Ron Bowden that discussed terminating the Management Agreement. Filing 64-12; see filing 68-3 at 8. The email references "strikes" against Senior Housing, including a dispute over liability insurance, design oversights like a missing refrigerator in the assisted living area, missing whirlpool room and the mismatched appliances, and Mason's absence from the facility in the weeks leading up to opening. Filing 64-12 at 1. Of particular import, Froehlich wrote:
Bowden apparently lives in Indianapolis and works in real estate and banking. Filing 70-12 at 5-6. It is not clear from the record how Bowden is associated with Froehlich or the Pemberly Place project. Senior Housing describes Bowden as an "outside party not employed by [Highway 2] or otherwise involved in [the dispute]." Filing 69 at 10. Highway 2 suggests Bowden is an "interested third party," and describes the emails to Bowden as "private communications." Filing 71 at 4. The only record testimony regarding Bowden is from Lindersmith in a 30(b)(6) deposition on behalf of Highway 2—she said Bowden was not related to Froehlich or involved in the management or decision making for Pemberly Place. Filing 70-12 at 5-6.
We discussed with Gary [Gotsdiner, outside counsel] that we could either terminate for cause, where we pay no termination fee, or try to stay friends and terminate without cause and pay an extra 6 months of Management Fee. We're going to do the latter.
Timing: We think we should call them on Thursday and tell them it's coming and then send it on Friday. More conversations will take place today and tomorrow before a decision is made.
Filing 64-12 at 1.
In a succinct letter dated April 26, 2018, Highway 2 terminated the Management Agreement "pursuant to Section 6.1.6 of the Agreement." Filing 64-4 at 2. Froehlich testified that he also called Zink that day and informed him the termination was due to "presence and distance." Filing 68-3 at 18. Froehlich testified he had another call on April 27 with Zink, Mason and Mues. Filing 68-3 at 19. On that call, Froehlich gave two additional reasons for the termination: the parties’ difficulty resolving conflict and that Pemberly Place was scheduled to open in 3 days and was not ready. Filing 68-3 at 19.
Section 6.1.6 provides, in relevant part:
6.1.6 Early Termination. In the event this Agreement is terminated by [Highway 2] prior to the end of its Term for any reason not set forth under Sections 6.1.1, 6.1.2, 6.1.4 or 6.1.5, or as a result of [Highway 2]’s breach under Sections 6.1.1, 6.1.2, or 6.1.4, or as a result of damages to [Pemberly Place] under Section 6.1.3 (the date of which should be called the "Early Termination Date " [Senior Housing] shall be entitled to receive, upon giving [Highway 2] 180 days written notice, the following:
6.1.6.1 All Base Fees (defined in Section 8 below) due and owing through the Early Termination Date and all Base Fees that would be due and owing for six (6) months thereafter.
6.1.6.2 The Participation Fee [equal to 15% of the net proceeds of that would result if Pemberly Place were sold at its then fair market value determined by agreement between the parties or a third-party appraisal].
Filing 1-1 at 8.
On May 3, Mason responded with a detailed letter outlining items to be tied up between the parties and the associated expenses, as well as Senior Housing's calculations of fees owed to it under Section 6.1.6. Filing 64-5 at 2-4. According to Senior Housing, it was owed $23,800 for outstanding construction period fees, $45,000 for six months of base management fees, and $325,568.69 plus interest for "participation fees" to be paid over five years. Filing 64-5 at 4.
An email chain dated May 7 among Froehlich, Mues, Lindersmith, Gotsdiner, and Bowden discussed Highway 2's options as they saw them. See filing 64-13. Initially, Mues outlined three options—(1) termination with cause which would give Senior Housing 45 days to cure, an option he described as "not great," (2) gross mismanagement which did not require notice, but would require filing or threatening to file a lawsuit to gain leverage and would be "like throwing a grenade in the relationship," and (3) termination without cause, which in Mues’ opinion would require re-appraisal of Pemberly Place to accurately calculate the participation fee. Filing 64-13 at 2-3.
Froehlich responded saying he thought the for-cause option wasn't being considered seriously enough and wondered how Senior Housing would cure things like its alleged failure to market the facility, design oversights and lack of presence. See filing 64-13 at 2. And then Froehlich forwarded the conversation to Bowden and said that the roughly $400,000 that Senior Housing demanded under the without-cause provision "[wasn't] going to happen." Filing 64-13 at 1. Froehlich explained the goal all along had been to "protect Bob [Zink]" and suggested Highway 2 "pay them $23,800 + 45,000" for the construction period and management fees and hope they "would be thrilled not getting $0 or even a bill to cover what [Highway 2] [was] having to deal with." Filing 64-13 at 1. Highway 2 claims it has incurred damages of $149,163 in costs to fix design errors it attributes to Senior Housing, as well as lost revenue. Filing 64-10 at 7-8. Froehlich asked Bowden to talk to Zink about the situation. Id.
On May 16 Highway 2 sent another letter to Senior Housing. Filing 64-7. In that letter, Highway 2 asserted that Senior Housing was guilty of gross mismanagement and therefore it was terminating the agreement under Section 6.1.4. According to Highway 2, Senior Housing's gross mismanagement included
"6.1.4 Fraud, Misrepresentation or Gross Mismanagement. Either party may terminate this Agreement upon a finding by any court having jurisdiction that the other party has engaged in fraud or gross mismanagement with regard to performance of obligations hereunder." Filing 1-1 at 7.
(1) material mistakes with respect to the physical structure ...; (2) strategic marketing errors ...; (3) lack of communication relating to formation and operation of the medical clinic; (4) no presence or oversight at [Pemberly Place] and; (5) [Senior Housing's] lack of willingness to compromise.
Filing 64-7 at 3. The letter went on to outline specifics regarding each of the enumerated categories. Id. at 3-8. This was the first time Highway 2 had provided notice to Senior Housing about any of its concerns. Filing 62 at 4, filing 67 at 2; see filing 64-1 at 18-22. And Highway 2 said it would not pay any early termination fees under 6.1.6 and threatened to file suit if Senior Housing "fail[ed] to agree." Id. at 8. This lawsuit followed.
III. DISCUSSION
Senior Housing now moves for summary judgment on liability for its breach of contract claim. Filing 62 at 6-11. Senior Housing also moves for summary judgment on Highway 2's remaining counterclaims for (1) breach of contract, (2) breach of the covenant of good faith and fair dealing, (3) negligent misrepresentation, and (4) unjust enrichment. Filing 62 at 11-22.
Highway 2 moves for summary judgment on Senior Housing's claims for (1) violation of the UDTPA, (2) unfair competition and unjust enrichment, and (3) unfair competition damages under all of its theories of recovery. Filing 60 at 1-2.
1. SENIOR HOUSING'S BREACH OF CONTRACT CLAIM
In order to recover for breach of contract, a plaintiff must plead and prove the existence of a promise, a breach of that promise, damages, and satisfaction of any conditions precedent to the defendant's duty to perform. Henriksen v. Gleason , 263 Neb. 840, 643 N.W.2d 652, 658 (2002). Here, Senior Housing moves for summary judgment on all of the elements except damages. See filing 62 at 1-2.
Senior Housing contends that Highway 2 terminated the Agreement on April 26 without cause under Section 6.1.6 and then breached the Agreement by failing to pay the fees due under that section. See filing 62 at 6-8. And Senior Housing argues Highway 2's later claims of gross mismanagement and termination under Section 6.1.4 are legally inconsequential and do not create genuine disputes of material fact. Filing 62 at 8-11. Highway 2 maintains it terminated the Agreement under Section 6.1.4 and that a jury must resolve this dispute of material fact between the parties. See filing 67 at 14-17. The parties agree that the Management Agreement sets forth the duties and obligations of each of the parties. Indeed, both parties seek to enforce the Management Agreement. See filing 1, filing 13. So the issues before the Court are whether Highway 2 breached the agreement and whether Senior Housing satisfied any conditions precedent to Highway 2's duty to perform.
The Court agrees with Senior Housing that Highway 2's April 26 termination is legally binding and that Highway 2 is in breach for failing to pay damages under Section 6.1.6. Highway 2 does not dispute that it sent the April 26 letter terminating the Management Agreement "pursuant to Section 6.1.6 of the Agreement." Filing 62 at 4, filing 67 at 2; see filing 64-4 at 2. Nor does Highway 2 make an argument why that termination should not be given legal effect. See generally , filing 67. The Court cannot and will not ignore the clear and unequivocal language of Highway 2's April 26 termination letter. Moreover, the April 25 email from Froehlich indicates that Highway 2 intended to terminate the Management Agreement without cause "to try and stay friends" with Senior Housing. Filing 64-12 at 1.
It's quite obvious from the record that Highway 2 later decided it did not want to pay Senior Housing the full amount of damages under Section 6.1.6 and would rather pursue termination for gross mismanagement, see filing 64-13 at 1, filing 64-7, but that decision was made too late. And regardless of Senior Housing's alleged wrongdoing, Highway 2 made a strategic choice to terminate without cause and must now live with the consequences.
Highway 2 argues, in a footnote, that Senior Housing failed to select and retain an appraiser to fairly calculate the participation fee due under Section 6.1.6.2. Filing 67 at 12 n.2. And Highway 2 suggests that because no appraisal has been conducted, it has no duty to pay the participation fee. Id. The Court is not persuaded. First, even if the participation fee is undetermined, that does not excuse Highway 2's failure to pay the outstanding construction period fees and management fees in accordance with 6.1.6.1, so Highway 2 would still be in breach. See filing 1-1 at 8-9. Second, the record does not support that Highway 2 has formally challenged Senior Housing's use of an existing appraisal of $25,500,000 to calculate the participation fee. See filing 64-5 at 3-4; filing 64-7; filing 64-13. Instead, Highway 2 just asserted that Senior Housing was not entitled to early termination fees because it "grossly mismanaged its duties." Filing 64-7 at 8. And the Court has already rejected that argument.
So, the Court concludes that Highway 2 terminated the Management Agreement under Section 6.1.6 and is therefore in breach for failing to pay liquidated damages in accordance with that provision. Thus, Senior Housing's motion for partial summary judgment on liability for its breach of contract claim will be granted. That does not mean, however, that Senior Housing is totally off the hook.
2. HIGHWAY 2'S COUNTERCLAIMS
Highway 2 has counterclaimed for breach of contract, breach of the implied covenant of good faith and fair dealing, negligent misrepresentation and unjust enrichment. Filing 13; filing 33. Senior Housing moves for summary judgment on all of Highway 2's counterclaims. But Highway 2 argues that genuine disputes of material fact exist as to each of its counterclaims and Senior Housing is not entitled to judgment as a matter of law. The Court agrees.
(a) Breach of Contract
Highway 2 argues that Senior Housing breached duties owed under Sections 2.1.3, 2.1.4, 2.1.5, 2.1.17 and 2.1.20 of the Management Agreement relating to development of the project. Filing 67 at 26-30; filing 64-10 at 2-3. Senior Housing contends that its duties were solely to manage Pemberly Place, not develop it. See filing 62 at 11-12. And according to Senior Housing, none of the obligations it allegedly breached are actually contained in the fully integrated Management Agreement. Id. at 12-13.
A contract written in clear and unambiguous language is not subject to interpretation or construction and must be enforced according to its terms. Gary's Implement, Inc. v. Bridgeport Tractor Parts, Inc. , 270 Neb. 286, 702 N.W.2d 355, 366 (2005). However, a contract is ambiguous when a word, phrase, or provision in the contract has, or is susceptible of, at least two reasonable but conflicting interpretations or meanings. Id. Whether a contract is ambiguous is a matter of law. Id. The meaning of an ambiguous contract is generally a question of fact. Id.
Section 2.1.3 provides:
2.1.3 Certification, Licensure, Registration and Legal Requirements. On [Highway 2's] behalf, [Senior Housing] will oversee the preparation by [Pemberly Place] personnel of all materials and the compliance with procedures necessary for [Highway 2] to obtain and retain: (a) certification of [Pemberly Place] as a provider of services under Titles XVIII (Medicare) and XIX (Medicaid) of the Social Security Act; and (b) State licensure and registration of [Pemberly Place] as a long term care facility under all applicable laws.
Filing 1-1 at 2.
Highway 2 argues that Senior Housing failed to include a "med room" in the design of Pemberly Place that was necessary to comply with regulatory requirements. Filing 67 at 27; filing 68-4 at 9. And according to Highway 2, Senior Housing also failed to "hire, train, organize, license, or otherwise set up the medical clinic," for operation beginning May 2018 when Pemberly Place was slated to open. Filing 67 at 27. Finally, Highway 2 suggests that Senior Housing did not oversee the preparation of computer software necessary to operate Pemberly Place and provide services to residents in breach of Section 2.1.3. Filing 67 at 27. Senior Housing responds that Highway 2 does not allege Pemberly Place did not receive Medicare or Medicaid certification or State licensure, and therefore has not alleged a breach of Section 2.1.3. Filing 62 at 15-16.
Lindersmith's testimony (at least in the record before the Court) did not specify which regulations or for what certification or licensure. See filing 68-4 at 9.
Section 2.1.3 requires that Senior Housing oversee the preparation of all materials and compliance with procedures necessary for the broad categories of Medicare and Medicaid certification and State licensure. The Court finds that the provision is unambiguous, but nevertheless requires Senior Housing to oversee processes that are complicated and include many steps not explicitly written out in the provision. Highway 2 will have to prove that Senior Housing's alleged failures were necessary for certification and licensure. But there is a genuine dispute of material fact as to whether Senior Housing breached its Section 2.1.3 obligations by not advising Highway 2 it needed an additional med room and by not having personnel and systems in place to run the medical clinic and document clinical services.
Highway 2 also argues Senior Housing breached duties under Sections 2.1.4 and 2.1.5:
2.1.4 Clinical Consulting, Staff Development and Program Implementation. [Senior Housing] will provide assistance with clinical policy making and provide general clinical consulting support, staff development and implementation of resident programs and operational efficiencies.
2.1.5 Operational Policies. [Senior Housing] will on [Highway 2's] behalf review existing or, with [Highway 2's] review and approval, develop and implement new operational policies and procedures to reasonably conform to then-current industry standards in the areas of admissions, budgeting, business office management, quality assurance, human resources, dietary and nursing. Such policies and procedures shall be subject to [Highway 2's] approval and reviewed at the quarterly meetings set forth in Section 2.1.6 below.
Filing 1-1 at 2. In particular, Highway 2 argues that Senior Housing "failed to provide assistance with marketing and program planning for [Pemberly Place]," failed to implement operational software, and failed to pre-lease any apartments. Filing 67 at 28.
Senior Housing argues that Highway 2 has failed to identify "specific programs, policies or procedures" that Senior Housing should have completed before Pemberly Place was open to the public. Filing 62 at 16. The Court disagrees. Highway 2 has identified the alleged failures of Senior Housing as outlined above. And those allegations raise a genuine dispute of material fact as to whether Senior Housing breached the obligations it owed under the plain language of Sections 2.1.4 and 2.1.5 of the Agreement.
Finally, Highway 2 asserts that Senior Housing took on additional duties and responsibilities during the development of Pemberly Place under Sections 2.1.20 and 2.1.17 of the Management Agreement, which provide:
2.1.20 Advisory Support. [Senior Housing] shall provide timely assistance without additional compensation with respect to special requests for graphs, charts, and information assimilation, market analysis, business plans, program planning and analysis relating to [Pemberly Place] and reasonably requested by [Highway 2].
2.1.17 Ancillary Services. Consistent with budgets approved by [Highway 2], [Senior Housing] will arrange for the provision of ancillary services not covered by this Agreement to [Pemberly Place] as needed, including without limitation marketing and promotion, training, construction, and care-related consultants, which may include nurse consultants, dietary consultants, occupational health nurses, physician/medical director and activities, social services and religious consultants.
Filing 1-1 at 4-5; filing 67 at 28-29
Highway 2 argues that the plain language of the agreement and the understanding of the parties was that Senior Housing would act as an advisor to Highway 2 throughout the term of the Agreement. Filing 67 at 29-30. According to Highway 2 Senior Housing contractually agreed to arrange for ancillary services including, without limitation , marketing and promotion, training, and construction. Filing 67 at 28. And Highway 2 says it paid Senior Housing a construction period fee of $7,500 per month precisely because the parties understood that Senior Housing would provide design, training and marketing expertise during the construction of Pemberly Place. Filing 67 at 30.
Highway 2 also points to conduct by Senior Housing that supports its reading of Sections 2.1.20 and 2.1.17. It directs the Court to the detailed project overviews Mason prepared and sent to Highway 2. See filing 67 at 3-4. Senior Housing also "helped select an architect and general contractor and regularly communicated with both, and "participated in various walk-throughs during construction." Filing 67 at 5; see filing 68-3 at 4-6; filing 68-4 at 3-4. And Highway 2 says it delegated certain design decisions to Senior Housing during construction. See filing 67 at 5; filing 68-4 at 5-8.
Senior Housing claims that its only contractual obligation was to "provide designated management services ‘in connection with the operation of the facility’ " and references Section 2.1 of the Management Agreement. See filing 62 at 13; filing 1-1 at 2. According to Senior Housing, Section 2.1.20 obligated it to "provide timely assistance" to Highway 2, but did not delegate to Senior Housing any final decision-making authority. Filing 62 at 14. Similarly, Senior Housing denies liability under Section 2.1.17 because it was not a party to any of the architectural or construction contracts and therefore cannot be liable for such defects. Filing 62 at 14-15. And it argues that Highway 2 has not identified a single request for ancillary services that Senior Housing failed to honor prior to termination of the Agreement. Filing 62 at 15.
The Court is not persuaded by Senior Housing's argument that the plain language of the contract only required Senior Housing to manage the facility once fully operational. For one thing, Senior Housing relies on the introductory sentence (Section 2.1) of a portion of the contract spanning 22 subsections and that requires Senior Housing to actively participate in the development of Pemberly Place. See filing 1-1 at 2-5. For example, Section 2.1.1 requires Senior Housing to "recruit and retain" a full-time administrator, and Section 2.18 requires Senior Housing to establish and implement bookkeeping and accounting procedures. Filing 1-1 at 2. And the plain language of Sections 2.1.20 and 2.1.17 contemplate Senior Housing assisting with business plans and program planning as well as arranging for services for marketing and promotion, training and construction.
Additionally, even if Sections 2.1.20 and 2.1.17 were ambiguous and this Court were to consider extrinsic evidence of the meaning of the provisions, Senior Housing's construction of the contract is untenable. The Agreement, construed as a whole, clearly provides that Senior Housing be involved and give advisory support during the construction of Pemberly Place. See Lexington Ins. Co. v. Entrex Commc'n. Servs., Inc. , 749 N.W.2d 124, 132 (Neb. 2008) ; Reisig v. Allstate Ins. Co. , 264 Neb. 74, 645 N.W.2d 544, 550 (2002) (contract must be construed as a whole). Senior Housing provided extensive project overviews, see filing 68-8, participated in the selection of an architect and general contractor, see filing 68-3 at 4-6; filing 68-4 at 3-4; and worked with vendors for the selection of appliances, see filing 68-6 at 6 and installation of wireless connectivity and security; see filing 68-6 at 6-7.
Finally, Highway 2 argues that to the extent Senior Housing was not required by the plain language of the Management Agreement to act as an advisor on design decisions, Senior Housing breached modifications made to the Agreement through Senior Housing's conduct. Filing 67 at 30-31. Senior Housing argues the integration clause requires any modifications be made in writing. Moreover, Senior Housing argues the conduct that forms the basis for the alleged modifications all pre-date the Agreement, and that "many" of the alleged breaches also occurred before the effective date of the Agreement. Filing 62 at 17.
Nebraska has long held that "the terms of a written executory contract may be changed by a subsequent parol agreement prior to any breach of contract." Johnson Lakes Dev., Inc. v. Cent. Neb. Pub. Power & Irrigation Dist. , 5 Neb.App. 957, 568 N.W.2d 573, 582 (1997) (emphasis added). Even a contractual provision requiring that modification or waiver of terms be in writing may be waived by acts or conduct. Pearce v. ELIC Corp. , 213 Neb. 193, 329 N.W.2d 74, 79 (1982).
Here, Lindersmith testified that all oral agreements between the parties occurred in 2015 before the Management Agreement was signed, and thus could not be a subsequent parol agreement. Filing 64-1 at 13-15. And the Court has already concluded that the unambiguous plain meaning of the contract required Senior Housing to do more than merely manage a fully developed and operational facility. So, Highway 2's alternative theory that Senior Housing breached modifications to the Management Agreement will be dismissed.
In sum, genuine issues of material fact exist regarding Highway 2's breach of contract claim arising from the written Management Agreement. So, Senior Housing's motion for summary judgment as to this claim will be denied.
(b) Breach of the Covenant of Good Faith and Fair Dealing
Senior Housing argues that it acted in accordance with the express provisions of the contract, as discussed above, and therefore could not have breached the covenant of good faith and fair dealing. Filing 62 at 17-18. Highway 2 alleges that Senior Housing acted unreasonably and improperly in executing its contractual obligations and therefore breached the covenant. Filing 67 at 32.
The implied covenant of good faith and fair dealing exists in every contract and requires that none of the parties to the contract do anything which will injure the right of another party to receive the benefit of the contract. Spanish Oaks, Inc. v. Hy-Vee, Inc. , 265 Neb. 133, 655 N.W.2d 390, 400 (2003). The nature and extent of the implied covenant "is measured in a particular contract by the justifiable expectations of the parties." Id. "Where one party acts arbitrarily, capriciously, or unreasonably, that conduct exceeds the justifiable expectations of the second party." Id. The question of a party's good faith in the performance of a contract is a question of fact. Id. at 396-97.
Highway 2 argues it did not receive the benefit of the Management Agreement because Senior Housing had an obligation to act as an advisor on construction and if the design of Pemberly Place was not in line with industry standards, Senior Housing should have said something. Filing 67 at 32. Now, according to Highway 2, it is stuck with a facility that has hallways that are too narrow and that required additional modifications to add a whirlpool room and outdoor space. Id.
As articulated above, the plain language of the contract and the conduct of the parties both support that Senior Housing did in fact agree to act as an advisor on design of the facility. So, a genuine dispute of material fact exists as to whether Senior Housing breached the covenant of good faith and fair dealing by unreasonably exercising its duties and denying Highway 2 the benefit of its bargain. Senior Housing's motion for summary judgment on this counterclaim will be denied.
(c) Negligent Misrepresentation
Senior Housing argues that it is entitled to judgment as a matter of law on Highway 2's negligent misrepresentation claim because (1) Highway 2 cannot recall any exact statements made by Senior Housing, (2) any statements Highway 2 has identified were made before execution of the Management Agreement and thus merged into the agreement, and (3) Highway 2 could have done due diligence to assess the accuracy of the alleged statements. Filing 62 at 19.
To state a claim for negligent misrepresentation a plaintiff must allege that (1) a representation was made; (2) the representation was false; (3) when made, the defendant knew the representation was false or acted carelessly or recklessly in ascertaining its truth; (4) the defendant intended the plaintiff to rely on the representation; (5) the plaintiff did in fact rely; and (6) the plaintiff was damaged as a result. Zawaideh v. Neb. Dep't of Health & Human Servs. Regulation & Licensure , 285 Neb. 48, 825 N.W.2d 204, 212 (2013) ; Lucky 7, LLC v. THT Realty, LLC , 278 Neb. 997, 775 N.W.2d 671, 675 (2009). Proof of a contract is not required, and "although contracts are often the end result of the plaintiff's reliance," a negligent misrepresentation claim arises out of the defendant's tortious actions independent of contract. Zawaideh , 825 N.W.2d at 212-13.
Highway 2 correctly points out that it has identified a representation with enough specificity for Senior Housing to defend against the claim. Both Lindersmith and Froehlich testified that at the beginning of the parties’ relationship Mason represented that Senior Housing had experience in creating high-end senior living facilities from the ground up and that it had done projects like Pemberly Place before. See filing 68-1 at 8; filing 68-3 at 13.
To the extent Lindersmith testified in her representative capacity for Highway 2 that Senior Housing also misrepresented "they would be here on site and weren't," filing 64-1 at 32, 36-37, that alleged misrepresentation has been abandoned by Highway 2 and will not proceed as a basis for Highway 2's negligent misrepresentation claim at trial. See filing 67 at 33-34.
And Highway 2 also argues that the negligent misrepresentation liability arises independent of any contract liability. See filing 67 at 34. That's a correct statement of the law, and the existence of the Management Agreement simply goes to show Highway 2's reliance. See Zawaideh , 825 N.W.2d at 212-213.
Finally, Highway 2 argues that the issue of due diligence is really a question of whether its reliance on Senior Housing's representation was reasonable, and that is a question of fact for the jury. Filing 67 at 34. In negligent misrepresentation cases, whether a plaintiff exercised ordinary prudence is relevant to whether a plaintiff justifiably relied on a misrepresentation. Lucky 7, LLC , 775 N.W.2d at 676. Whether a party's reliance on a misrepresentation was reasonable is a question of fact. Cao v. Nguyen , 258 Neb. 1027, 607 N.W.2d 528, 533 (2000). So, whether Highway 2 reasonably relied on Senior Housing's representation that it could create high-end senior living facilities from the ground up is for the jury to decide. And of course Highway 2 will still have to prove the representation was false. See Zawaideh , 825 N.W.2d at 212. But Senior Housing's motion for summary judgment will be denied as to Highway 2's negligent misrepresentation claim.
(d) Unjust Enrichment
Highway 2's unjust enrichment claim was brought in the alternative to its breach of contract claim. Filing 67 at 34. And while contract claims supersede unjust enrichment (or quasi-contract) claims, a plaintiff is permitted to allege both. See Fed. R. Civ. P. 8(e) ; see also Bloedorn Lumber Co. of North Platte v. Nielson , 300 Neb. 722, 915 N.W.2d 786, 793 (2018). But where a contract theory is deemed viable, it is appropriate to dismiss the unjust enrichment claim on summary judgment. See Nielson , 915 N.W.2d at 792-93 ; Washa v. Miller , 249 Neb. 941, 546 N.W.2d 813, 818-19 (1996). And here, the Court has concluded that the Management Agreement is enforceable and Highway 2's contract theories are viable and will proceed to trial. So, Senior Housing's motion for summary judgment on Highway 2's unjust enrichment counterclaim will be granted.
(e) Proof of Damages
Senior Housing's final argument is that all of Highway 2's counterclaims should be dismissed because Highway 2 cannot prove that any of its damages were proximately caused by Senior Housing's conduct and reflect "nothing more than what [Highway 2] admits to be an estimate." Filing 62 at 21. Highway 2 argues (1) it provided approximate calculations for all of its construction and design expenses, and (2) its lost revenue claim does not require an exact figure and may be submitted to the jury based on the evidence that damage occurred. See filing 67 at 35-37. The Court agrees.
A plaintiff's evidence of damages may not be speculative or conjectural and must provide a reasonably certain basis for calculating damages. Pribil v. Koinzan , 266 Neb. 222, 665 N.W.2d 567, 572 (2003). Whether the evidence of damages is "reasonably certain" is a question of law. Id. Uncertainty as to the fact of whether any damages were sustained at all is fatal to recovery, but uncertainty as to the amount is not. Gary's Implement, Inc. v. Bridgeport Tractor Parts, Inc. , 281 Neb. 281, 799 N.W.2d 249, 259 (2011) ; Pribil , 665 N.W.2d at 572. Proof of damages to a mathematical certainty is not required; the proof is sufficient if the evidence is such as to allow the trier of fact to estimate actual damages with a reasonable degree of certainty and exactness. Pribil , 665 N.W.2d at 572. If sufficient evidence is presented that it clearly appears that a loss of revenue was suffered, it is proper to let the jury determine what the loss probably was from the best evidence the nature of the case allows. Gary's Implement, Inc. , 799 N.W.2d at 259. If the Court determines the evidence of damages provides a basis for determining damages with reasonable certainty, the issue can be submitted to the jury. Pribil , 665 N.W.2d at 573. For damages that are not prospective, the jury is instructed that the plaintiff must prove the nature and extent of damages by the greater weight of the evidence. Id. But, if the plaintiff seeks prospective damages, i.e. lost revenue, the contingent nature of the damages claimed inherently requires consideration of future events that can only be reasonably predicted, but not conclusively proved, at the time of trial. Id. As such, the jury should be instructed that the plaintiff may recover prospective damages for injuries "reasonably certain" to be incurred in the future. Id. at 574.
The Court is not persuaded by Senior Housing's argument that Highway 2's damages are so speculative and conjectural that they should not be submitted to a jury. To begin, the "estimated numbers" Senior Housing complains of are sufficiently concrete: Highway 2 testified it paid about $43,321 for a spa room, $12,042 for an additional med room, and $35,000 for outdoor space improvements. See filing 64-10 at 7. Moreover, the damages Highway 2 claims stem from Senior Housing's unprofitable meal plan structure, see filing 64-10 at 8, are likely not prospective and could be reasonably calculated. The law does not require the plaintiff to prove damages down to the penny for the evidence to go before a jury. See Gary's Implement, Inc. , 799 N.W.2d at 259 ; Pribil , 665 N.W.2d at 572.
The Court also finds sufficient evidence, in the form of Lindersmith's testimony and Highway 2's sworn interrogatory responses, to prove damages were sustained by Highway 2 from Senior Housing's alleged (1) failure to market the facility, (2) inadequate development of resident fee structures, (3) oversight in separating the assisted living and independent living wings, and (4) failure to prepare the medical clinic for opening. See filing 64-10 at 7; filing 68-1 at 6-8. Because these are prospective damages, the jury will be instructed that the plaintiff may recover prospective damages only for injuries "reasonably certain" to be incurred in the future. Pribil , 665 N.W.2d at 574. Id. In other words, the burden remains on the plaintiff to offer at trial the best evidence of what its losses reasonably will be. See Gary's Implement, Inc. , 799 N.W.2d at 259.
3. SENIOR HOUSING'S UNFAIR COMPETITION DAMAGES
Senior Housing seeks unfair competition damages in the form of "lost profits" either as breach of contract damages or as damages under its common law "unfair competition/unjust enrichment" claim. See filing 69 at 1-2. Highway 2 moves for summary judgment on Senior Housing's ability to recover unfair competition damages and argues that (1) Section 6.1.6 of the Management Agreement is an exclusive remedy provision and bars unfair competition damages for Senior Housing's breach of contract claim, (2) Senior Housing has failed to state a claim for common law or statutory unfair competition, and (3) even if Senior Housing stated a claim, the economic loss doctrine would still bar recovery. See filing 60 at 7-8; filing 71 at 6-7.
Highway 2 first argues that Senior Housing's breach of contract claim arises under Section 6.1.6, which is an exclusive remedy provision as stated in Section 6.2. Filing 1-1 at 8. Those sections provide:
6.1.6 Early Termination. In the event this Agreement is terminated by [Highway 2] prior to the end of its Term for any reason not set forth under Sections 6.1.1, 6.1.2, 6.1.4 or 6.1.5, or as a result of [Highway 2]’s breach under Sections 6.1.1, 6.1.2, or 6.1.4, or as a result of
damages to [Pemberly Place] under Section 6.1.3 (the date of which should be called the "Early Termination Date " [Senior Housing] shall be entitled to receive, upon giving [Highway 2] 180 days written notice, the following:
6.1.6.1 All Base Fees (defined in Section 8 below) due and owing through the Early Termination Date and all Base Fees that would be due and owing for six (6) months thereafter.
6.1.6.2 The Participation Fee [equal to 15% of the net proceeds of that would result if Pemberly Place were sold at its then fair market value determined by agreement between the parties or a third-party appraisal].
6.2 Effect of Termination. ... Except as set forth in Section 6.1.6 , the remedies in this Agreement provided in favor of the parties shall not be deemed exclusive or alternative, but shall be cumulative and shall be in addition to all other remedies in its favor existing at law or in equity.
Filing 1-1 at 8 (emphasis added).
Senior Housing argues that Sections 6.2 and 6.1.6, read individually or together, are not a conspicuous limitation of remedy as required by Nebraska law. Filing 69 at 4-5. Instead, Senior Housing reads Section 6.2 as directing the parties to Section 6.1.6 to find any restrictions on the parties’ remedies, and Section 6.1.6 "simply identifies three different fees available" to Senior Housing where Highway 2 terminates under that section. Filing 69 at 5.
As previously stated, the Court must enforce an unambiguous contract according to its terms. Gary's Implement, Inc. , 702 N.W.2d at 366. A contract must be construed as a whole, and if possible, effect must be given to every part thereof. Reisig , 645 N.W.2d at 550. A contract is only ambiguous if it has, or is susceptible of, at least two reasonable but conflicting interpretations or meanings. Id. (emphasis added). Parties to a contract may privately bargain for the amount of damages to be paid in the event of a breach of contract or early termination, provided the stipulated sum is reasonable in light of the circumstances. U.S. Pipeline, Inc. v. N. Nat. Gas Co. , 303 Neb. 444, 930 N.W.2d 460, 475 (2019) ; Reichert v. Rubloff Hammond, L.L.C. , 264 Neb. 16, 645 N.W.2d 519, 527 (2002) ; see Kozlik v. Emelco , 240 Neb. 525, 483 N.W.2d 114, 122 (1992) ; Bishop Cafeteria Co. of Omaha v. Ford , 177 Neb. 600, 129 N.W.2d 581, 592 (1964).
Here, Senior Housing's reading of Sections 6.1.6 and 6.2 is unpersuasive and inconsistent with the plain language of the Agreement. The only reasonable reading of Section 6.2 is that Section 6.1.6 provides an exclusive remedy when termination occurs under that section. If Senior Housing's reading were to be accepted, the language "[e]xcept as set forth in Section 6.1.6" found in Section 6.2 would be superfluous. And Section 6.1.6. clearly reflects the parties’ negotiated agreement of reasonable damages in the event of termination under that section.
Senior Housing attempts to distinguish U.S. Pipeline and other cases relied on by Highway 2 because the exclusive remedy provisions at issue in those cases applied to all claims brought under the contract. See filing 69. But Nebraska courts have also enforced liquidated damage provisions aimed specifically at early termination. See Kozlik , 483 N.W.2d at 122 ; Ford , 129 N.W.2d at 592. And what is early termination, if not complete refusal to perform and thus material breach of contract? So, Senior Housing raises a distinction without a difference. Moreover, the reasons for enforcing a stipulated damages provision of any kind, e.g. because damages are difficult to ascertain or measure and the stipulated amount is not disproportionate to the amount of damages that could be reasonably anticipated, apply equally to damages for breach or early termination. See Kozlik , 483 N.W.2d at 121-22.
Senior Housing also suggests the stipulated damages provision of 6.1.6 is inconspicuous and therefore unenforceable. See filing 69 at 4-5. Not so. First, the case relied on by Senior Housing for the legal proposition "in order for a limitation of remedy to be effective, it must also be conspicuous" is a case interpreting the requirements of the Uniform Commercial Code and does not apply to the Management Agreement—a contract for services. See Adams v. Am. Cyanamid Co. , 1 Neb.App. 337, 498 N.W.2d 577, 588 (1992). And second, even if that were the standard, Section 6.1.6 is conspicuous—it appears in a section boldly titled "Termination of Agreement," itself is titled "Early Termination," and is immediately followed by Section 6.2 which explains that Section 6.1.6 is an exclusive remedy provision. See filing 1-1 at 7-8.
Lastly, Senior Housing argues "[a]t worst, there is a question of fact as to what, if any, damages are limited by the Management Agreement that must be resolved by the jury." That may be true if the contract were ambiguous. See Gary's Implement, Inc. , 702 N.W.2d at 366. But the Court concludes as a matter of law that the Management Agreement provisions at issue, sections 6.2 and 6.1.6, are unambiguous, leaving no question of fact for the jury. See id.
In sum, the Court concludes that Senior Housing is bound by the terms of the parties’ Agreement and its breach of contract damages for Highway 2's early termination under Section 6.1.6 are limited to those expressly provided in that section.
Senior Housing also makes a separate claim for unjust enrichment/unfair competition under the common law. According to Senior Housing, common law unfair competition is "very much recognized" under Nebraska law, and "might be called stealing a business." Filing 69 at 16. But the authority that Senior Housing relies on makes clear that when such a claim is recognized, it sounds in tort. See Meylan Enter., Inc. v. W-S Indus. Servs., Inc. , No. A-02-547, 2004 WL 291368 at *6 (Neb. Ct. App. Feb. 17, 2004) (discussing Frank H. Gibson, Inc. v. Omaha Coffee Co. , 179 Neb. 169, 137 N.W.2d 701 (1965) ). And Highway 2 argues a tort claim would be barred by the economic loss doctrine. See filing 71 at 7. The Court agrees.
The Court is skeptical of Senior Housing's characterization that one unpublished federal district court opinion citing an unpublished opinion of the Nebraska Court of Appeals makes a claim "very much recognized." See Pape Ventures, Inc. v. Richter , No. 8:19CV424, 2020 WL 6587092, at *3 (D. Neb. May 19, 2020) (quoting Meylan Enter., Inc. v. W-S Indus. Servs., Inc. , No. A-02-547, 2004 WL 291368 at *6 (Neb. Ct. App. Feb. 17, 2004) ).
The economic loss doctrine precludes tort remedies only where the damages caused were limited to economic losses and where either (1) a defective product caused the damage or (2) the duty which was allegedly breached arose solely from the contractual relationship between the parties. Lesiak v. Cent. Valley Ag Coop., Inc. , 283 Neb. 103, 808 N.W.2d 67, 81 (2012). And economic losses are defined as commercial losses, unaccompanied by personal injury or other property damage. Id.
Senior Housing's basis for both its unfair competition and unjust enrichment claims is that Highway 2 "interfered with [Senior Housing's] employees and contracts and then excluded [Senior Housing] after it helped get [Pemberly Place] ready to open." Filing 69 at 18. And Senior Housing says Highway 2 got all the benefit of Senior Housing's expertise without having to pay for it, and then "cut them out of the project once it was set to open." Id. But for Highway 2's actions, Senior Housing says it would have experienced "profits totaling $1,107,079.63 to $1,178,427.29." Id.
Senior Housing's unfair competition damages are commercial losses for alleged lost profits and Highway 2's duty to not "cut them out" arose solely from the parties’ contractual relationship. So, Senior Housing's unfair competition claim is subject to the economic loss doctrine and must be dismissed.
And to the extent Senior Housing is making an unjust enrichment claim, it must also be dismissed. Just like Highway 2's unjust enrichment claim, where Senior Housing's contract theory is deemed viable, it is appropriate to dismiss the unjust enrichment claim on summary judgment. See Nielson , 915 N.W.2d at 792-93 ; Washa 546 N.W.2d at 818-19.
In sum, the Court will grant Highway 2's motion for summary judgment on Senior Housing's claim for breach of contract damages not explicitly outlined in Section 6.1.6 of the contract. And the Court will also grant Highway 2's motion as to Senior Housing's third claim for relief—unjust enrichment/unfair competition.
4. SENIOR HOUSING'S UDTPA CLAIMS
Senior Housing claims that Highway 2 violated the Nebraska UDTPA and particularly Neb. Rev. Stat. §§ 87-302(a)(9) and (a)(16)(i). Filing 1 at 5; filing 69 at 8-14. Highway 2 argues that (1) Senior Housing's conclusory allegations fail to state a claim, and (2) Senior Housing has not shown that it is "likely to be damaged" and is therefore ineligible for equitable relief under the statute. See filing 60 at 11.
The UDTPA provides injunctive relief for "[a] person likely to be damaged," and permits a Court to grant such relief "as it deems necessary to protect the public form further violations ...." Neb. Rev. Stat. § 87-303. It therefore provides relief from future damage, not past damage. Reinbrecht v. Walgreen Co. , 16 Neb.App. 108, 742 N.W.2d 243, 248 (2007). According to Senior Housing, Highway 2's alleged past disparagement of Senior Housing's business and services "represent a risk of further undermining [Senior Housing's] standing in the local market and national groups." The Court is unpersuaded.
Senior Housing claims that Highway 2's disparagement includes the May 16, 2018 letter from Highway 2 to Senior Housing, see filing 1 at 3; filing 64-7, as well as the two e-mails Froehlich sent to Bowden in April and May 2018, see filing 69 at 9-10; filing 64-12; filing 64-13. But evidence of three communications sent in 2018 between the parties and Bowden is not "evidence sufficient to support an inference of future harm." See Reinbrecht , 742 N.W.2d at 248. Because Senior Housing has failed to show it is entitled to injunctive relief, the Court need not consider the merits of Senior Housing's UDTPA claims, and they will be dismissed. Accordingly,
IT IS ORDERED:
1. Senior Housing's motion for partial summary judgment (filing 61) is granted as to Highway 2's liability for breach of contract and Highway 2's counterclaim for breach of modifications to the Management Agreement. It is denied in all other respects.
2. Highway 2's motion for partial summary judgment (filing 59) is granted.