Calce v. Dorado Exploration, Inc.

309 S.W.3d 719, 2010 Tex. App. LEXIS 2217, 2010 WL 1173112
CourtCourt of Appeals of Texas
DecidedMarch 29, 2010
Docket05-08-00588-CV
StatusPublished
Cited by32 cases

This text of 309 S.W.3d 719 (Calce v. Dorado Exploration, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Calce v. Dorado Exploration, Inc., 309 S.W.3d 719, 2010 Tex. App. LEXIS 2217, 2010 WL 1173112 (Tex. Ct. App. 2010).

Opinion

OPINION

Opinion By

Justice LANG.

In this case, we address breach of contract claims and a claim for misappropriation of trade secrets relating to two agreements: a confidentiality agreement (the “Confidentiality Agreement”) and an agreement providing for compensation for services (the “Fee Agreement”). Following a jury trial, a judgment was signed by the trial court awarding (1) money damages, injunctive relief, and attorney’s fees to Dorado Exploration, Inc. (“Dorado”) (appellee/cross-appellant) on its claims for breach of the Confidentiality Agreement and misappropriation of trade secrets against John V. Calce II (“Calce”), William B. Heyn (“Heyn”), Impact Equity, LLC (“Impact Equity”), and Blue Lion Ventures, Ltd. (“Blue Lion”) (appellants/cross-appellees) (collectively, “Appellants”); and (2) money damages, stock, and attorney’s fees to Impact Equity on the breach of contract counterclaim of Impact Equity and Blue Lion against Dorado respecting the Fee Agreement.

In five issues on appeal, Appellants (a) assert error in the trial court below in rendering judgment against Appellants on Dorado’s claims and the awarding of attorney’s fees to Dorado and (b) challenge the adequacy of the jury’s award to Impact Equity as to the breach of contract *724 counterclaim. In addition, Impact Equity contends this Court lacks jurisdiction to consider Dorado’s cross-appeal. Dorado asserts two cross-points, 1 challenging Impact Equity’s recovery on its breach of contract counterclaim and asserting that, should the breach of contract counterclaim fail, Impact Equity and Blue Lion are not entitled to recovery on their alternative counterclaim for quantum meruit. Based on the analysis below, we affirm the trial court’s judgment in part, reverse the judgment in part, and render judgment that Dorado take nothing on its claims for breach of contract, attorney’s fees, and misappropriation of trade secrets.

I. FACTUAL AND PROCEDURAL BACKGROUND

Dorado is an oil and gas exploration company formed by Donal Schmidt and Thimothy Wafford. At the time of the events giving rise to this case, Schmidt was Dorado’s chief executive officer and president and Wafford was Dorado’s chief operating officer. In April 2005, Schmidt, Wafford, and Calce attended a meeting at the offices of Piot Capital Advisors, LLC (“Piot Capital”) to discuss the selling of Dorado stock.

At that time, the Confidentiality Agreement was executed. The Confidentiality Agreement stated in relevant part:

This Agreement is between Dorado Exploration, Inc. (a Maryland Corporation) and affiliates and associates (collectively “Offeror”) and Piot Capital Advisors, LLC (collectively “Receiver”) and sets forth the terms for the presentation to Receiver of an oil and gas prospect(s) (the “Prospect(s)”) which will provide Receiver with the opportunity to (1) evaluate the Prospect and to acquire either a direct interest in an oil and gas interest (including, but not limited to, drilling or leasing, royalty, and purchase of producing properties) in the Prospect lands on the basis of mutually acceptable compensation to the Offeror or an indirect interest through purchase of a Security, such as stock or a partnership interest, in or with the Offeror; or (2) facilitate the sale, lease purchase or transfer of the property either for the benefit of Receiver or a third party.

(emphasis original). The Confidentiality Agreement defined “proprietary and confidential information” and provided that for a period of three years, “Receiver” would, in relevant part, (1) keep Dorado’s proprietary and confidential information secret and not disclose such information without specific written authorization of Dorado, (2) use Dorado’s proprietary and confidential information solely for the purpose of evaluating the “Prospect” and not use such information for financial gain without compensation to Dorado, and (3) not reproduce or make copies of any of Dorado’s proprietary and confidential information without specific authorization of Dorado. Further, the “Receiver” agreed not to contact any financial partner, advisor, shareholder, director, stockholder, company member, or banker of Dorado without express written permission.

Paragraph five of the Confidentiality Agreement provided in relevant part:

Binding Effect on Receiver and Others. This Agreement entered into by Receiver shall be binding on Receiver *725 and Receiver’s owners, officers, directors, employees, agents, associates, attorneys, accountants and representatives. Receiver agrees to inform all such persons and entities of this Agreement and to be liable to the Offeror for the acts of such persons and entities if this Agreement is breached by any one of them.

(emphasis original). Finally, the Confidentiality Agreement stated “Offeror shall be entitled to recover the cost and expenses incurred in enforcing this Agreement including any attorney’s fees.”

The signature portion of the Confidentiality Agreement appeared in relevant part as follows:

AGREED TO AND ACCEPTED this 6th day of April, 2005:
OFFEROR: RECEIVER:
Dorado Exploration, Inc. Company: Piot Capital Advisors, LLC
[[Image here]]
Name: Donal R. Schmidt, Jr. Name: John V. Calce
Signature: /s/ via email Signature: [handwritten signature ]
Title: President and CEO Title: Partner [handwritten]

(emphasis original).

On April 18, 2005, the second agreement at issue in this case, the Fee Agreement, was executed. The Fee Agreement stated in relevant part:

This letter agreement (“Agreement”) confirms the terms and conditions of the engagement of Impact Equity and Blue Lion Ventures (collectively “Impact Equity”) by Dorado Exploration, Inc. and its affiliates (collectively, the “Company” or “DE”) to render certain financial advisory and investment banking services to DE in connection with the Company’s review of its strategic and financial alternatives, specifically, the Company’s Funding. In the context of this agreement, “Funding” means the aggregate value of any equity, debt, promissory notes or other funds raised in conjunction with the venture capital funding round of DE.

In paragraph one of the Fee Agreement, Dorado agreed to pay Impact Equity for its services as follows:

(a) An engagement fee of $1,000 payable upon execution of [the Fee Agreement]; plus
(b) Upon completion of the Company’s Initial Funding with an identified funding source, a final success fee equal to the percentage of all funds raised as defined on the following schedule and a percentage of the common stock or partnership units of DE as defined by the following schedule:
(i) 10% success fee and percentage on all equity funds and 7% success fee and percentage on all debt funds raised up to and including $5 million

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Cite This Page — Counsel Stack

Bluebook (online)
309 S.W.3d 719, 2010 Tex. App. LEXIS 2217, 2010 WL 1173112, Counsel Stack Legal Research, https://law.counselstack.com/opinion/calce-v-dorado-exploration-inc-texapp-2010.