Roxford, Theodore v. Ameritech Corp ( 2003 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 02-3198
THEODORE ROXFORD, D/B/A VAKIL,
Plaintiff-Appellant,
v.
AMERITECH CORPORATION,
Defendant-Appellee.
____________
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 00 C 282—James B. Zagel, Judge.
____________
ARGUED MAY 13, 2003—DECIDED JULY 11, 2003
____________
Before ROVNER, DIANE P. WOOD, and EVANS, Circuit
Judges.
EVANS, Circuit Judge. In the mid-1990’s, Lawrence Niren
explained to anyone who would listen how he used a variety
of schemes to con businesses out of more than $2 million. In
most cases, companies paid Niren a small fee in exchange
for information about potential investors or other business
opportunities that didn’t really exist. Niren eventually
came clean, sending a full confession to various media out-
lets and turning himself into authorities. He hoped the pub-
licity he generated would help him promote the book he had
almost finished—he had even sold an option for the rights
to the movie, tentatively titled “Barbarians at the Gate
Meet Robin Hood, as Written by Woody Allen.”
2 No. 02-3198
The only problem with Niren’s confession was that
nobody seemed to care enough to hear it. Several of the
companies Niren says he swindled thought he had actually
completed the work he was paid to do, while others deter-
mined it wasn’t worth their time to try to collect the small
amounts Niren claimed to have stolen. The Justice Depart-
ment decided not to pursue a prosecution, leaving Niren
strangely willing but unable to get arrested. Forbes maga-
zine, in a featured article entitled “Stop Me Before I Steal
Again,” called Niren a fellow “so pathetic his story demands
to be told.”1
This case arises out of a deal Theodore Roxford struck
with Ameritech that looks similar to one of Niren’s old
tricks. The resemblance isn’t all that surprising because, as
it turns out, Lawrence Niren and Theodore Roxford are ac-
tually the same person—Niren changed his name in 1995.
Roxford claims that this time he actually completed the
work he had promised to do and deserves to be paid ac-
cordingly.
Roxford’s dealings with Ameritech began in 1996 when he
told the company that he had confidential information from
telecommunications companies Bell Canada Enterprises,
Inc. (“BCE”) and Northern Telecom of Canada about their
interest in a possible joint venture or other business com-
bination. Roxford sent Ameritech the information he had
(Ameritech claims—and the district court agreed—that
Roxford could not prove that the information was, in fact,
confidential), and, several conversations later, Roxford and
Ameritech signed the agreement at the heart of this case.
Under the terms of that September 12 agreement, Vakil
(the fictitious name Roxford used for his mergers and ac-
quisition business) promised to disclose confidential infor-
mation from BCE and Northern Telecom about a possible
1
Forbes, June 19, 1995.
No. 02-3198 3
merger with Ameritech. In return, Ameritech promised to
pay Roxford a finder’s fee equal to .1 percent of the transac-
tion price of any deal it struck with the Canadian compa-
nies, with a maximum payout of $2.5 million.
Two years later, Ameritech paid approximately $3.4 bil-
lion to acquire 20 percent of Bell Canada, a BCE subsid-
iary. Roxford claims that he is entitled to the $2.5 million
finder’s fee for facilitating the deal. Ameritech argues that
Roxford never fulfilled his obligations under the agreement
and, as such, it doesn’t think it owes him anything. Specifi-
cally, Ameritech claims that Roxford never lived up to his
September 12 obligations because he sent all of the relevant
information before the contract was signed and he had no
evidence that the information was confidential. The district
court agreed on both counts and granted Ameritech’s mo-
tion for summary judgment. Roxford appeals.
Summary judgment is appropriate when there is no
genuine issue of material fact and the moving party is enti-
tled to judgment as a matter of law. Fed. R. Civ. P. 56(c).
We review a grant of summary judgment de novo, viewing
all facts and taking all inferences from those facts in a light
most favorable to Roxford. Chapman v. Keltner, 241 F.3d
842, 845 (7th Cir. 2001). Because Roxford originally filed
this suit in the Northern District of California, we apply
California’s choice-of-law rules to determine the applicable
law. See International Marketing, Ltd. v. Archer-Daniels-
Midland Co., 192 F.3d 724, 729 (7th Cir. 1999). California’s
“government interest” analysis suggests that we apply
California law. See, e.g., Application Group, Inc. v. Hunter
Group, 61 Cal.App.4th 881, 896-97, 72 Cal.Rptr.2d 73, 82
(1998).
The district court found the language of the September 12
agreement to be clear: Roxford would provide confidential
information at some future time. Roxford has two re-
sponses. First, he claims that, after September 12, he sent
4 No. 02-3198
Ameritech the originals of the documents he had previously
faxed to the company. He says that means he actually pro-
vided confidential information after the agreement was
signed. That argument, however, contains a fatal flaw.
Since Roxford had already shared the information, it wasn’t
really confidential anymore. Moreover, Ameritech never
would have agreed to pay up to $2.5 million for information
it already had, so it makes little sense to suggest that the
“confidential information” Roxford promised to provide was
the same information he had already shared.
Roxford’s more plausible argument is that both parties
intended the “confidential information” in the agreement to
refer to the documents Roxford had already sent, even
though the language of the agreement suggested that new
information would be forthcoming. Therefore, Roxford con-
cludes, he had already performed under the contract by the
time the agreement was signed—the agreement was meant
simply to formalize the deal and to ensure confidentiality.
Whether Roxford believed that the agreement referred to
the information he had already provided is largely irrele-
vant, however, because of the plain language of the Sep-
tember 12 contract. Under California law, “[t]he language
of a contract is to govern its interpretation, if the language
is clear and explicit, and does not involve an absurdity.” Cal
Civ Code § 1638 (2003). “Courts will not adopt a strained or
absurd interpretation in order to create an ambiguity where
none exists.” Bay Cities Paving & Grading, Inc. v. Lawyers’
Mut. Ins. Co., 5 Cal. 4th 854, 867 (1993) (quoting Reserve
Ins. Co. v. Pisciotta 30 Cal. 3d 800, 807 (1982)). See also
Sterling Builders Inc. v. United Nat. Ins. Co., 79
Cal.App.4th 105, 111, 93 Cal.Rptr.2d 697, 701 (2000) (“for
a contract to be ambiguous it must be susceptible to at least
two different reasonable interpretations”).
The language of the September 12 agreement could not
have been much clearer. The first sentence of the letter
No. 02-3198 5
says, “[t]his Agreement replaces all and any other Agree-
ments between Vakil and Ameritech,” making any discus-
sions or agreements Roxford had with Ameritech before
September 12 irrelevant. The agreement continues: “Vakil
has confidential information from BCE Inc. and Northern
Telecom. . . . Vakil will immediately disclose this informa-
tion to Ameritech . . . .” That language leaves no doubt that
Roxford (as Vakil) promised to send confidential informa-
tion to Ameritech sometime after September 12. Because
there is no ambiguity in the language of the contract,
Roxford must live by its terms.
If Roxford actually intended the agreement to apply to the
information he had already given Ameritech, as he claims,
he has only himself to blame—he’s the one who drafted the
agreement (which was printed on Vakil letterhead), so he
had full control over the language. During his deposition,
Roxford testified that he had disclosed all of the informa-
tion to Ameritech by August 27, so by his own admission he
failed to perform. Since no confidential information was
delivered after the agreement, Roxford is not entitled to
collect the finder’s fee whether or not the information he
initially provided was confidential.
AFFIRMED.
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—7-11-03