Crosstown Holding Company, et al., Appellants, vs. Associated Banc-Corp., a Wisconsin corporation, et al., Respondents.

Crosstown Holding Company, et al., Appellants, vs. Associated Banc-Corp., a Wisconsin corporation, et al., Respondents. A05-2317, Court of Appeals Unpublished, August 22, 2006.

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (2004).

 

 

STATE OF MINNESOTA

IN COURT OF APPEALS

A05-2317

 

Crosstown Holding Company, et al.,

Appellants,

 

vs.

 

Associated Banc-Corp., a Wisconsin corporation, et al.,

Respondents.

 

Filed August 22, 2006

Affirmed

Ross, Judge

 

Hennepin County District Court

File No. CT 05 006003

 

 

Richard T. Ostlund, Randy G. Gullickson, Janel M. Dressen, Anthony Ostlund & Baer, 3600 Wells Fargo Center, 90 South Seventh Street, Minneapolis, MN 55402 (for appellants)

 

Timothy D. Kelly, Carrie L. Zochert, Sarah E. Bushnell, Kelly & Berens, P.A., 3720 IDS Center, 80 South Eighth Street, Minneapolis, MN 55402 (for respondents)

 

 

            Considered and decided by Wright, Presiding Judge; Shumaker, Judge; and Ross, Judge.

 

U N P U B L I S H E D   O P I N I O N

ROSS, Judge

 

This case arises from a disappointed bidder's legal challenge to the sale of the Rochester branches of Marquette Bank.  Appellants Crosstown Holding Company and 21st Century Bank (collectively referred to as "Crosstown") contest the district court's order granting judgment on the pleadings to respondents First Federal Capital Bank, et al., based on the doctrine of collateral estoppel.  Because determinative issues necessary to maintain each of Crosstown's claims against respondents were fully and conclusively litigated in a prior action, and because Crosstown had a full and fair opportunity to be heard on each issue, we affirm.

FACTS

The breakaway sale of three branches of Marquette Bank is at the heart of this dispute.  In 2001, Wells Fargo & Company sought to acquire Marquette Bank, N.A., in its entirety.  To gain federal regulatory approval for this acquisition, Wells Fargo agreed to sell several Marquette branch banks, including three branches in Rochester, Minnesota.

Wells Fargo prepared bid packages for the Rochester branches and invited prospective bidders, including Crosstown, to submit bids.  Crosstown contacted Wells Fargo and expressed interest in bidding on the Rochester branches.  Wells Fargo required each bidder to sign a confidentiality agreement to receive a bid package.  The confidentiality agreement stated that none of the parties "shall have any obligation with respect to an Acquisition except pursuant to written agreements, if any, entered into after the date hereof."  Crosstown signed the confidentiality agreement, and it soon received a bid package.

The first page of the bid package indicated the non-binding nature of the offering process:

The acceptance by a bidder of the offering procedures set forth in the Memorandum does not constitute an agreement in the principle or letter of intent with respect to the terms of any possible transaction between the bidder and the Companies. The Companies further expressly reserve the right, at any time, to modify any of the terms, conditions or procedures of the offering or to terminate discussions and request the return of this Memorandum.

 

The bid package also established the process for the sale of the Marquette branch banks.  Wells Fargo invited potential bidders to review the materials provided on each of the branches and to submit "non-binding indications of interest" or, in other words, a preliminary bid, by noon on November 7, 2001.  Wells Fargo intended to review the bids and to determine which preliminary bidder would be allowed to advance in the process by conducting limited due-diligence investigation for the purchase of the branches.

On November 7, Crosstown submitted its "indication of interest," or preliminary bid, of $19,406,555 for the Rochester branches.  Crosstown based this bid on a 14-percent premium on total deposits.  Crosstown's bid amount was more than three times greater than either of the other two bids received for the Rochester branches, and Crosstown was the only company invited to conduct a due-diligence investigation of the Rochester branches.  On November 9, Steve McConley, a vice-president of Wells Fargo's Corporate Development Department, notified Crosstown by telephone that its bid was very impressive and that Wells Fargo was "moving forward with you and you alone."

Wells Fargo introduced Crosstown's CEO to respondent Michael Bue to facilitate continued due-diligence investigation of the Rochester branches.  Bue, a Marquette employee and president of the Rochester branches, was assigned to assist Crosstown in this task during the sale of the branches and to be Crosstown's primary contact in Rochester.

Bue then engaged in some behind-the-scene brokering, setting in motion the sale that led to this litigation.  On November 14, unbeknownst to either Wells Fargo or Crosstown, Bue entered into a contract with Robert Edelman, a Milwaukee investment banker, to find a different buyer for the Rochester branches that would guarantee Bue equity ownership in and long-term employment with the branches.  Edelman knew of respondent First Federal Capital Bank in Wisconsin, and he alerted it to the opportunity to buy the Rochester branches.  Bue and Edelman met with First Federal officers to discuss a possible purchase by First Federal.  It was not part of Bue's duties at Marquette to solicit a purchaser of the Rochester branches.

A week after Bue contracted with Edelman, Edelman contacted Wells Fargo on behalf of First Federal.  He did not disclose his connection with Bue to Wells Fargo.  Wells Fargo then allowed First Federal to bid on the Rochester branches.  First Federal signed a confidentiality agreement on November 21, 2001, and Wells Fargo sent the bid package.  First Federal submitted a preliminary bid for the Rochester branches that was based on a 15-percent premium on total deposits, one percent higher than Crosstown's preliminary bid.  Based on First Federal's bid, Wells Fargo invited First Federal to perform a due-diligence investigation of the Rochester branches.

On December 1, Crosstown disclosed to Bue the amount of its November 7 bid.  Crosstown then performed the first part of its due-diligence inspection of the Rochester branches, and Wells Fargo informed Crosstown that it was allowing another potential purchaser to conduct a due-diligence review of the Rochester branches.

Crosstown objected.  Crosstown wrote to Wells Fargo on December 7, 2001, charging that it had understood Steve McConley's November 9 statement that Wells Fargo was "moving forward with [Crosstown] and [Crosstown] alone" to mean "essentially . . . [Crosstown was] the highest bidder in the process and that [Wells Fargo] would be proceeding with [Crosstown] alone."  Crosstown also declared that "[b]ased upon the representation by [McConley], [it had] geared up [its] efforts to move toward a signed agreement and closing."  In the same letter, Crosstown made a new offer on the Rochester branches, this time lower than its November 7 preliminary bid.  The December 7 offer was based on a 14-percent premium on total deposits, a reduction of $300,000 for asbestos abatement, and a reduction of up to $750,000 for losses on loans.

Wells Fargo replied by letter.  It informed Crosstown that it would not respond to the December 7 offer and reiterated that another party would also conduct a due-diligence investigation and possibly submit a bid for the Rochester branches.  Wells Fargo also stated that the final bids for the Rochester branches were due on December 18, 2001, and that if Crosstown chose to submit a bid, it would be considered "along with any other conforming bids."  The letter also stated, "Our acknowledgement of your bid and willingness to accept an extension or resubmission of your bid does not constitute an agreement with respect to the terms of a possible transaction."  On December 17, Bue sent a memorandum to Wells Fargo in support of First Federal's purchase of the Rochester branches.

Crosstown submitted a final bid of $17,609,332 for the Rochester branches, based on a 12.36-percent premium on deposits.  First Federal submitted a final bid of $26,521,110, based on a 17-percent premium on deposits.  Wells Fargo decided to sell the branches to First Federal and entered into a written agreement to do so on January 15, 2002.  The sale of the branches to First Federal closed in April 2002.

This sale precipitated Crosstown's first suit.  The same month of the sale to First Federal, Crosstown sued Wells Fargo and Marquette for breach of contract, breach of covenant of good faith and fair dealing, misrepresentation, negligent misrepresentation, promissory estoppel, unjust enrichment, and civil conspiracy.  Crosstown premised its suit on its contention that Wells Fargo had breached its binding acceptance of Crosstown's bid for the Rochester branches and its promise to negotiate exclusively with Crosstown for their sale.  Wells Fargo moved for summary judgment.

Crosstown maintains that during discovery in its action against Wells Fargo and Marquette, it learned the extent of Bue's, Edelman's, and First Federal's participation in the sale of the Rochester branches.  Crosstown therefore moved the district court for leave to amend the complaint to add Bue, Edelman, and First Federal as defendants and to add new claims against Wells Fargo.  Its memorandum in support of the motion argued that the amendment was warranted because "the new claims [against Bue and First Federal] arise from the same set of transactions and occurrences that necessitated the original Complaint" and because the new claim as amended involved "the same facts and the same witnesses" as the original claim.  The fact section of Crosstown's memorandum in opposition to Wells Fargo's motion for summary judgment asserted that Bue, Edelman, and First Federal misappropriated Crosstown's confidential bid information and used it to convince Wells Fargo to breach its allegedly binding agreement to sell the Rochester branches to First Federal.  In its motion to amend the complaint, Crosstown incorporated by reference that fact section.

The district court heard Crosstown's motion to amend the complaint jointly with Wells Fargo's motion for summary judgment.  In July 2004, the district court granted summary judgment to Wells Fargo and Marquette on all claims, but it did not rule on Crosstown's motion for leave to file the amended complaint.

The district court explained its rationale for granting summary judgment. Concerning the breach-of-contract claim, the district court determined that no contract existed on which Crosstown could base its claim because the express language of the confidentiality agreement and the bid package created only an offer to make a preliminary bid and expressly reserved the right to change the terms and procedures at any time.  As to Crosstown's assertion that Wells Fargo breached its contract to keep Crosstown's preliminary bid information and identity confidential, the court found that "[n]owhere in the confidentiality agreement does Wells Fargo agree to keep information obtained from its bidders secret." 

The district court determined that Crosstown's claim for breach of covenant of good faith and fair dealing must fail because there was no contract and because Minnesota does not recognize a claim for breach of covenant of good faith and fair dealing separate from an underlying breach of contract claim.

The district court determined that Crosstown's misrepresentation claim, based on McConley's statements that Wells Fargo was going forward with "[Crosstown] alone" and that Crosstown's bid was the highest, must also fail.  It reasoned that there was no evidence showing that the statements, when made, were false, because McConley made the statements before he was aware of First Federal's interest in the Rochester branches and before First Federal had submitted a bid.  The district court determined that the claim for negligent misrepresentation must fail because the parties are sophisticated businesses negotiating at arm's length.  The district court determined that Crosstown had no meritorious claim for promissory estoppel because Wells Fargo's promise that it would go forward "with you and you alone" could not reasonably be seen as a promise of a future benefit.  The court concluded that "[i]t is hard to see much, if any, reliance" by Crosstown on Wells Fargo's statement that it would proceed with Crosstown "alone" and that "Crosstown [did not] suffer any clear, significant loss because of the ‘promise.'"

As to the unjust enrichment claim, the court observed that "[i]t is unusual for the Court to be asked to consider this claim when nothing of value passed from [Crosstown] to [Wells Fargo or Marquette]."  The court concluded that Crosstown had no basis for a claim for unjust enrichment because "there is no evidence in the record to show that [Wells Fargo or Marquette was] enriched because of any illegal or unlawful behavior by anyone."  The court determined that Crosstown could sustain no claim for conspiracy because no evidence indicated that the actions taken by Marquette and Wells Fargo were unlawful or that the alleged conspirators established a plan to engage in an unlawful act.

The district court did not expressly rule on Crosstown's motion to amend the complaint, and therefore did not specifically address the claims made in the amended complaint against Bue, Edelman, and First Federal.  But the facts alleged in the amended complaint concerning Bue and First Federal were incorporated by reference into Crosstown's memorandum in opposition to summary judgment.  Those facts, therefore, were before the district court at the summary judgment hearing.  And the district court's order demonstrates that it considered Crosstown's theory of the case, including the charge that Bue, Edelman, and First Federal had conspired to remove Crosstown from its promised position of sole bidder and to sell to First Federal.

The district court made several key findings concerning the role that First Federal, Bue, and Edelman played in the sale:

[i]t is undisputed that Bue did not tell First Federal how much he thought it should bid, and he played no role in First Federal's analysis of the branches;

 

[t]here is no evidence that Bue, Edelman, or anyone from First Federal knew, when First Federal submitted its bid, what premium on total deposits Crosstown had included in its bid;

 

[d]uring a December 1, 2001, meeting with Bue, [the Crosstown CEO] disclosed the amount of Crosstown's November 7, 2001 bid;

 

[b]y December 18, 2001, when Crosstown submitted its final bid, [Crosstown] knew that First Federal was [its] competitor and that First Federal was a significantly larger operation than Crosstown;

 

[t]here is no evidence to show that anyone from First Federal knew what Crosstown's final bid was going to be.  [The Crosstown CEO] himself testified that Crosstown had not decided the amount of its final bid until shortly before it was submitted; and

 

[b]ecause First Federal's final bid was substantially higher than Crosstown's, Wells Fargo decided to sell the Rochester branches to First Federal.

 

The district court concluded that "Bue and Edelman were making an opportunity from which to profit, in a situation where they had no legal or moral duty to [Crosstown]."

This court affirmed the district court's grant of summary judgment to Wells Fargo and Marquette.  Crosstown Holding Co. v. Marquette Bank, N.A., No. A04-1693, 2005 WL 1154271, at *8 (Minn. App. May 17, 2005).  We specifically observed that Wells Fargo did not make a binding promise to sell the banks to Crosstown or to keep Crosstown's bid information confidential.  Id. at *4.  We described Crosstown's suit this way:

Essentially, Crosstown's theory is that Wells Fargo acted unlawfully when Bue misused Crosstown's confidential bid information as well as when Wells Fargo reneged on its promise to move forward exclusively with Crosstown. The product of this "unlawful" action was a "windfall of several million dollars" when Wells Fargo sold the Rochester branches to First Federal at a higher price than what Crosstown had offered. Crosstown has not shown that Wells Fargo was not entitled to seek out the highest bidder for the Rochester branches. Nor has it shown that it would be unjust for Wells Fargo to keep the money it received when it sold the branches to First Federal.

 

Id. at *7.

We deemed the district court's failure to rule on Crosstown's motion for leave to amend the complaint a denial:

It appears that, because the district court granted Marquette's and Wells Fargo's motion for summary judgment on all of the claims, it denied Crosstown's motion to amend.  However, the district court's reasoning is unclear because it did not provide any explanation or order addressing Crosstown's motion. . . . [Therefore] we affirm the district court's denial of the motion based solely on the timing of the motion and do not reach the merits of the motion.

 

Id. at *8.

In November 2004, Crosstown filed the amended complaint for damages against First Federal and Bue, alleging tortuous interference with a prospective business relationship, misappropriation of trade secrets, common law misappropriation of confidential information, unjust enrichment, unfair competition, and civil conspiracy.  The theory of the case was that First Federal and Bue illegally colluded to misappropriate confidential information contained in Crosstown's bid and used that information to unfairly influence Wells Fargo to breach its binding agreement to sell the Rochester branches to Crosstown, enriching Bue and First Federal at Crosstown's expense.

In June 2005, First Federal and Bue moved for a judgment on the pleadings under Minn. R. Civ. P. 12.03 based on, among other things, the doctrine of collateral estoppel.  First Federal and Bue argued that Crosstown was estopped from asserting the claims in the amended complaint because the grant of summary judgment against Crosstown in the action against Wells Fargo and Marquette had conclusively determined the following dispositive issues:  that Crosstown had no legally binding exclusivity right to negotiate to buy the Rochester branches from Wells Fargo; that Wells Fargo had a legal right to solicit bids from First Federal and First Federal had a legal right to submit bids; that the written agreements between Wells Fargo and Crosstown did not bar Wells Fargo from disclosing information concerning Crosstown's bid to other bidders; that Bue did not tell First Federal the amount of Crosstown's bid or how much First Federal would have to bid to beat Crosstown's bid; that Wells Fargo was free to sell the branches to First Federal; that Bue played no part in First Federal's analysis of the Rochester branches; and that Wells Fargo sold the Rochester branches to First Federal not because of any action on Bue's part but because First Federal submitted a higher bid than Crosstown.

In August 2005, the district court granted Bue and First Federal's motion for a judgment on the pleadings based on collateral estoppel.  Relying specifically on the findings from Crosstown's suit against Wells Fargo and Marquette, the court determined that the earlier action had adjudicated dispositive issues as to each of the claims against Bue and First Federal.  The district court determined that Crosstown was collaterally estopped from making a claim of tortious interference with a prospective business relationship by the determination in the first action that Crosstown had no legally binding exclusivity right to negotiate to buy the Rochester branches from Wells Fargo; that Bue played no part in First Federal's decision to bid a certain amount; that First Federal did not know what Crosstown's final bid was going to be; and that the reason Wells Fargo sold the banks to First Federal was that the latter's bid was "substantially higher" than Crosstown's.  The district court determined that Crosstown was collaterally estopped from making a claim for misappropriation of trade secrets by the determinations in the first action that Bue did not tell First Federal how much it should bid to exceed Crosstown's preliminary bid and that First Federal did not know when it submitted its final bid what Crosstown's final bid was.

The district court concluded that the issue of common law misappropriation of confidential information had been conclusively determined in the first action by the finding that Bue had not conveyed information concerning Crosstown's bid to First Federal and the finding that Wells Fargo was not bound to protect the confidentiality of that information.

The district court concluded that the issue of unjust enrichment had been conclusively determined in the first action by the findings that "nothing of value" passed from Crosstown to any other party, that First Federal prevailed in the sale solely because it submitted the highest bid, and that Bue had no legal or moral duty to Crosstown.  The district court concluded that the issue of unfair competition had been conclusively determined in the first action by the findings that First Federal had a right to bid on the banks, that Bue did not influence First Federal's analysis of the Rochester branches by providing confidential information, and that First Federal prevailed in the sale solely because it submitted the highest bid.  Finally, the district court concluded that the issue of civil conspiracy had been conclusively determined in the first action by the finding that "[t]here is no evidence in the record to show that [Wells Fargo or Marquette] were enriched because of any illegal or unlawful behavior by anyone."  This appeal follows.

 

D E C I S I O N

Crosstown contests the district court's dismissal on the pleadings.  "The only question on review of a judgment on the pleadings is whether the complaint sets forth a legally sufficient claim for relief."  Martens v. Minn. Mining & Mfg. Co., 616 N.W.2d 732, 750 (Minn. 2000) (Gilbert, J., dissenting) (quotation omitted).  On an appeal from judgment on the pleadings, this court focuses on the pleadings' allegations, Minn. R. Civ. P. 12.03, but may also consider documents and statements that are incorporated by reference into the pleadings.  See Martens, 616 N.W.2d at 739 n.7 (limiting review of order for dismissal to documents and statements referred to in complaint).  We accept as true all facts alleged in the complaint and draw all reasonable inferences in favor of the nonmoving party.  Bodah v. Lakeville Motor Express, Inc., 663 N.W.2d 550, 553 (Minn. 2003).  Material factual questions will preclude an order of judgment on the pleadings.  See Martens, 616 N.W.2d at 739-40 (observing that judgment on the pleadings is not appropriate "if it is possible on any evidence which might be produced, consistent with the pleader's theory, to grant the relief demanded" (quotation omitted)).

Crosstown must demonstrate that the district court erroneously decided that no issues of fact remain open following the first litigation.  No questions of fact exist when collateral estoppel conclusively precludes relitigation of an issue.  State Farm Mut. Auto. Ins. Co. v. Spartz, 588 N.W.2d 173, 175 (Minn. App. 1999), review denied (Minn. Mar. 30, 1999).  Collateral estoppel applies such that a factual or legal resolution necessary to a court's judgment may preclude relitigation of the factual or legal issue in a later suit and different claims involving a party to the first suit.  Allen v. McCurry, 449 U.S. 90, 94, 101 S. Ct. 411, 414 (1980).  "The doctrine . . . mandates that once an issue is actually and necessarily determined by a court of competent jurisdiction, that determination is conclusive in subsequent suits, based on a different cause of action, involving a party to the prior litigation."  Haavisto v. Perpich, 520 N.W.2d 727, 731 (Minn. 1994) (quotation omitted).

Collateral estoppel precludes relitigation of an issue "where (1) the issue [is] identical to one [decided] in a prior adjudication; (2) there [is] a final judgment on the merits; (3) the estopped party was a party or in privity with a party to the prior adjudication; and (4) the estopped party [had] a full and fair opportunity to be heard."  Kaiser v. N. States Power Co., 353 N.W.2d 899, 902 (Minn. 1984).  Courts "do not apply collateral estoppel rigidly and focus instead on whether an injustice would be worked upon the party upon whom the estoppel is urged."  Nelson v. Am. Family Ins. Group, 651 N.W.2d 499, 511 (Minn. 2002).

We review the availability of collateral estoppel as "a mixed question of law and fact subject to de novo review."  Falgren v. State, Bd. of Teaching, 545 N.W.2d 901, 905 (Minn. 1996).  But if collateral estoppel is available, we will not reverse a district court's decision to apply the doctrine absent a "demonstrated abuse of discretion." Pope County Bd. of Comm'rs v. Pryzmus, 682 N.W.2d 666, 669 (Minn. App. 2004), review denied (Minn. Sept. 29, 2004).

The parties do not dispute that there was a final judgment on the merits in the Wells Fargo action or that Crosstown was a party to the prior adjudication.  Crosstown instead rests its challenge on the first and fourth elements of collateral estoppel.  Specifically, Crosstown argues that collateral estoppel does not bar litigation of its claims against respondents because the issues of fact and law conclusively adjudicated in the Wells Fargo action are not identical to the issues in the current claim and because it did not have a full and fair opportunity to be heard in that action.  We address each of Crosstown's claims in turn, and then its opportunity to be heard, to answer whether issues of fact and law necessary to maintain those claims were conclusively adjudicated in the Wells Fargo action.

1.                  Tortuous interference with prospective business relationship/Unfair competition

 

We first consider whether the material issues in Crosstown's claim of tortious interference were fully litigated in the first action.  To establish a claim of tortious interference with a prospective business relationship, Crosstown is required to prove that Bue and First Federal intentionally committed a wrongful act that improperly interfered with its prospective relationship with Wells Fargo.  See United Wild Rice, Inc. v. Nelson, 313 N.W.2d 628, 633 (Minn. 1982).  Crosstown also must show that, but for the interference, it would have realized the business advantage.  See N. Cent. Co. v. Phelps Aero, Inc., 272 Minn. 413, 419-20, 139 N.W.2d 258, 263 (1965).  "Unfair competition is not a tort with specific elements; it describes a general category of torts which courts recognize for the protection of commercial interests."  Rehab. Specialists, Inc. v. Koering,  404 N.W.2d 301, 305 (Minn. App. 1987); accord United Wild Rice, 313 N.W.2d at 632 (observing that unfair competition can be based on tortious interference with contract or improper use of trade secrets).

In the Wells Fargo action, the district court determinedcontrary to Crosstown's assertions on appealthat there was no "illegal or unlawful behavior by anyone" involved with the bidding; that Crosstown was a mere bidder whose preliminary bid did not entitle it to exclusively negotiate to buy the Rochester branches from Wells Fargo; and that Wells Fargo sold the branches to First Federal not because of any action on Bue's part but because First Federal submitted a higher bid than Crosstown.  And although it may be true that but for First Federal's high bid, Crosstown might have purchased the Rochester branches, the district court specifically found that First Federal's participation in the bidding process was proper.  Because the district court's factual and legal determinations conclusively establish that there was neither a legally protectible prospective business relationship between Crosstown and Wells Fargo nor any wrongful interference with the bidding process by respondents, we conclude that these dispositive issues have been fully litigated.  Therefore, the district court did not err by ruling that Crosstown is collaterally estopped from making a claim for tortious interference with a prospective business relationship or unfair competition.

2.         Misappropriation of trade secrets/Common law misappropriation of confidential information

 

We also believe that the material issues regarding Crosstown's claims of misappropriation were previously litigated.  To establish that information is confidential or a trade secret, a plaintiff must show that: (1) the information is not generally known or ascertainable; (2) the information provides a demonstrable competitive advantage; and (3) the information was subject to reasonable efforts to maintain its secrecy.  Widmark v. Northrup King Co., 530 N.W.2d 588, 592 (Minn. App. 1995) (noting that these claims are governed by statute and listing elements), review denied (Minn. June 14, 1995).  Misappropriation is the improper acquisition, disclosure, or use of confidential information.  Minn. Stat. § 325C.01, subd. 3 (2004).

In its suit against Bue and First Federal, Crosstown alleged that Bue misappropriated confidential information concerning the amount of Crosstown's "indication of interest" and communicated that information to First Federal, enabling First Federal to make an initial indication of interest only one percent above Crosstown's.  In the Wells Fargo action, the district court found that "[n]owhere in the Confidentiality Agreement does Wells Fargo agree to keep information obtained from its bidders secret."  It therefore determined that none of the information disclosed during the bidding process was confidential.  The specific finding that there was no confidential information, and therefore no duty to protect information disclosed during the bid process, is fatal to Crosstown's misappropriation claims against Bue and First Federal.  See Widmark, 530 N.W.2d at 593 (affirming summary judgment on a claim for misappropriation of trade secrets where there was no duty to keep information secret).

The district court also found "no evidence that Bue, Edelman, or anyone from First Federal knew, when First Federal submitted its bid, what premium on total deposits Crosstown had included in its bid" and no evidence that "Bue . . . told First Federal how much it had to bid to beat Crosstown."  On these findings, even were Crosstown able to establish that the information was confidential, its misappropriation claims could be estopped by the district court's finding that the information was not communicated to First Federal.

Concerning the effect of the alleged misappropriation of confidential information on Crosstown's final bid, the district court found that "[t]here is no evidence to show that anyone from First Federal knew what Crosstown's final bid was going to be.  [The Crosstown CEO] himself testified that Crosstown had not decided the amount of its final bid until shortly before it was submitted."  This finding establishes that Bue did not have, and could not have transmitted, information concerning Crosstown's final bid.  

Crosstown attempts to distinguish its misappropriation claims against Bue and First Federal from its previous action against Wells Fargo on the ground that the Wells Fargo claim asserted a breach of Wells Fargo's contractual duty to keep information secret, while the current claims allege tortious misappropriation by Bue and First Federal.  But a claim against different parties, and based on a different cause of action, may still be precluded by collateral estoppel when issues of fact necessary to the claim have been conclusively resolved in a prior action.  See Allen, 449 U.S. at 94, 101 S. Ct. at 414.  The findings that Crosstown's bid information was neither confidential nor misappropriated would defeat Crosstown's misappropriation claims.

Crosstown also argues that the fact issues relevant to its misappropriation claims against Bue and First Federal were not before the district court when that court considered Wells Fargo's motion for summary judgment and have therefore not been conclusively resolved.  But Crosstown's memorandum in opposition to Wells Fargo's motion for summary judgment alleged that Bue misused Crosstown's confidential bid information to improperly assist First Federal and influence Wells Fargo.  It also asserted that Wells Fargo and Marquette were vicariously liable for Bue's actions.  These issues have been fully adjudicated, potentially barring through collateral estoppel Crosstown's claims for misappropriation of trade secrets and common-law misappropriation of confidential information.

3.         Unjust enrichment

We next review whether Crosstown's unjust enrichment claim is collaterally estopped by the prior litigation.  To establish a claim for unjust enrichment, Crosstown must show that Bue and First Federal knowingly received something of value to which they were not entitled under circumstances that would make it unjust for them to retain the benefit.  See ServiceMaster of St. Cloud v. GAB Bus. Servs. Inc., 544 N.W.2d 302, 306 (Minn. 1996).  Crosstown must establish that Bue and First Federal were "unjustly enriched in the sense that the term ‘unjustly' could mean illegally or unlawfully," First Nat'l Bank of St. Paul v. Ramier, 311 N.W.2d 502, 504 (Minn. 1981), or that retention of the benefit was morally wrong.  Schumacher v. Schumacher, 627 N.W.2d 725, 729 (Minn. App. 2001).

Crosstown asserts that First Federal's purchase of the Rochester branches for approximately $26 million, compared to Crosstown's bid of approximately $17 million, was unjust because it resulted from Bue's and First Federal's improper interference with the bidding process.  This argument fails on the district court's finding that Wells Fargo's sale to First Federal did not result from any action on Bue's part.

Crosstown argues that the district court in the Wells Fargo action only adjudicated unjust enrichment concerning the wrongful acts of Wells Fargo and Marquette, and did not consider alleged wrongful acts committed by Bue or First Federal.  Crosstown contends that a determination that Marquette and Wells Fargo were not unjustly enriched by their conduct during the bidding process does not conclusively resolve whether Bue and First Federal were unjustly enriched by their improper misappropriation of Crosstown's business opportunity.  The argument misses key findings.

The district court determined that neither Bue nor First Federal wrongly interfered with the bidding, and it rejected the unjust enrichment claim on the ground that "there is no evidence in the record to show that [Wells Fargo or Marquette was] enriched because of any illegal or unlawful behavior by anyone."  The court also concluded that "Bue and Edelman were making an opportunity from which to profit, in a situation where they had no legal or moral duty to [Crosstown]."  The factual allegations concerning Bue's and First Federal's involvement in the bidding were asserted in Crosstown's motion in opposition to summary judgment, were before the district court, and were fully adjudicated.  Crosstown's claim of unjust enrichment is also subject to collateral estoppel.

4.         Civil conspiracy

We next examine Crosstown's claim of conspiracy in light of the issues resolved in the prior adjudication.  "A conspiracy is a combination of persons to accomplish an unlawful purpose or a lawful purpose by unlawful means."  Harding v. Ohio Cas. Ins. Co., 230 Minn. 327, 337, 41 N.W.2d 818, 824 (1950).  The alleged conspirators must have a meeting of the minds regarding "a plan or purpose of action to achieve the contemplated result."  Bukowski v. Juranek, 227 Minn. 313, 318, 35 N.W.2d 427, 429 (1948).

Again, the district court in the Wells Fargo action determined that the bid process was proper, that "there is no evidence in the record to show that [Wells Fargo or Marquette was] enriched because of any illegal or unlawful behavior by anyone," and that "Bue and Edelman were making an opportunity from which to profit, in a situation where they had no legal or moral duty to [Crosstown]."  Crosstown argues that the district court's conclusion that no civil conspiracy existed between Wells Fargo and Marquette has no preclusive effect on its claim that such a conspiracy existed between Bue and First Federal because the factual allegations concerning Bue and First Federal were not before the court.  But its memorandum in opposition to summary judgment filed in that action articulates its conspiracy claim in a manner that belies this argument: "Marquette and Wells Fargo, including actions through their agent, Bue, engaged in concerted efforts between themselves, and with First Federal and Edelman to remove Crosstown from its promised position of sole bidder and to cause the Rochester [branches] to be sold to First Federal."  With these factual assertions as Crosstown's support, the district court decided the issue of whether Bue and First Federal conspired to deprive Crosstown of a business opportunity.  Crosstown incorrectly argues on this appeal that "[i]t has not yet been adjudicated . . . whether Bue and First Federal engaged in unlawful actions or whether they established a plan for a lawful purpose but carried out that plan through unlawful means."  The facts relevant to Crosstown's conspiracy claim having been fully adjudicated, the district court did not err by concluding that Crosstown's claim for unjust enrichment is subject to collateral estoppel.

5.         Full and fair opportunity to be heard

This takes us to whether Crosstown had a full and fair opportunity to litigate these claims in the first action.  "The question of whether a party had a full and fair opportunity to litigate a matter generally focuses on whether there were significant procedural limitations in the prior proceeding, whether the party had the incentive to litigate fully the issue, or whether effective litigation was limited by the nature or relationship of the parties."  State v. Joseph, 636 N.W.2d 322, 328 (Minn. 2001) (quotation omitted).

Crosstown argues that because the facts asserted in its amended complaint were not before the district court that granted Wells Fargo and Marquette summary judgment, and because that court did not specifically rule on Crosstown's motion to amend the complaint, Crosstown did not have an opportunity to fully argue the claims arising from those facts.  This assertion is not supported by the record, which indicates that the district court considered and adjudicated the factual allegations set out in Crosstown's amended complaint when ruling on Crosstown's motion for summary judgment.

Several factors inform this conclusion.  Crosstown incorporated by reference the facts in the amended complaint into its memorandum in opposition to Wells Fargo's motion for summary judgment.  Those facts were submitted to the court and formed the basis for Crosstown's argument at the hearing on its motion to amend the complaint.  It is clear from the district court's summary judgment order that it did not base its findings and conclusions solely on Crosstown's first complaint, which alleged wrongdoing only by Wells Fargo and Marquette.  The district court's July 2004 order contains detailed findings directly addressing Bue's and First Federal's alleged improper involvement in the bidding process, demonstrating that the court considered the contested issues set out in the amended complaint.  And because Crosstown specifically alleged that Wells Fargo was vicariously liable for Bue's wrongs and that First Federal conspired with Wells Fargo and Bue, it placed those issues before the district court in the Wells Fargo action.  Crosstown had a full and fair opportunity to litigate the facts in the amended complaint.

We look finally at the question of justice.  We cannot see any injustice by applying collateral estoppel here.  The parties conducted discovery for two years in the Wells Fargo action, and they had the opportunity to present facts to the district court concerning alleged wrongdoing by Wells Fargo, Marquette, Bue, Edelman, and First Federal.  The district court in that action issued detailed findings and concluded that the bidding process was uncompromised by wrongful conduct by anyone and that First Federal legitimately prevailed in the bidding process solely due to its high competitive bid.  Crosstown made its factual allegations and corresponding arguments concerning Bue and First Federal to the district court in the context of its motion to amend the complaint and its filings in opposition to Wells Fargo's motion for summary judgment.  The district court's findings in that action were affirmed after additional consideration by this court.  Fairness does not preclude the district court's application of collateral estoppel.

To now conclude that the district court erred by granting respondents a judgment on the pleadings, we would be required to disregard that the controlling issues of fact have been contested, litigated, adjudicated, and affirmed.  Crosstown has offered no compelling legal basis for us to do so.  The issues adjudicated by the district court in the Wells Fargo action are dispositive of each of the claims Crosstown asserted in this action, and the district court did not err by determining that the claims are therefore barred by the doctrine of collateral estoppel.

Affirmed.