InfoBridge, LLC v. Chimani, Inc.
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In this dispute over a purported royalty fee, the Supreme Judicial Court vacated the superior court's order granting partial summary judgment in favor of InfoBridge, LLC on InfoBridge's claim for breach of contract, holding that the contract's royalty provision was ambiguous.
Chimani and InfoBridge entered into a contract under which InfoBridge would create a software program. For this work, Chimani was to pay InfoBridge scheduled payments. The contract also contained a royalty provision requiring Chimani to pay InfoBridge royalties. InfoBridge later filed a complaint against Chimani alleging, inter alia breach of contract. InfoBridge then moved for partial summary judgment on its breach of contract claim, arguing that the royalty provision unambiguously required Chimani to pay InfoBridge 14.5 percent of Chimani's net revenue from the program, up to a total royalty fee of $150,000. The court granted the motion for summary judgment and denied Chimani's cross-motion for summary judgment on its equitable estoppel affirmative defense on the grounds that Chimani waived the equitable estoppel issue. The Supreme Court affirmed in part and vacated in part the judgment below, holding (1) Chimani waived its equitable estoppel defense; but (2) the royalty provision was ambiguous, and the summary judgment record did not permit a determination of its meaning as a matter of law.
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