Intelsat USA Sales Corp. v. Juch-Tech, Inc.

52 F. Supp. 3d 52, 2014 WL 2930679, 2014 U.S. Dist. LEXIS 88536
District Court, District of Columbia·Decided June 30, 2014·No. Civil Action No. 2010-2095·Published·Cited by 1 cases

Opinion

Re Document Nos.: 59, 74

MEMORANDUM OPINION

Denying Juch-Tech’s Motion for Partial Summary Judgment; and Denying Juch-Tech’s Motion to Strike

RUDOLPH CONTRERAS, United States District Judge

I. INTRODUCTION

Plaintiff and Counter-Defendant Intelsat USA Sales LLC (“Intelsat Sales”), formerly known as Intelsat USA Sales Corporation, brought suit against Defendant and Counter-Claimant Juch-Tech, Inc. (“Juch-Tech”) alleging breach of contract and unjust enrichment on the theory that Juch-Tech refused to pay for services rendered after Intelsat Sales performed all of its contractual obligations. Juch-Tech filed an amended counterclaim that included several counts, many of which either have been dismissed by stipulation or limited through this Court’s prior rulings. Now before the Court is Juch-Tech’s motion seeking partial summary judgment on the narrow but monetarily significant issue of whether Intelsat Sales is entitled as a matter of law to recover contract acceleration damages pursuant to the parties’ NonExclusive Service Agreement. For the reasons discussed below, the Court will deny Juch-Tech’s motion.

II. FACTUAL BACKGROUND

Intelsat Sales and Juch-Tech are companies that operate in the satellite communications industry. Specifically, Intelsat Sales provides satellite bandwidth—also known as “space segment”—to users and network operators; Juch-Tech leases such space segment from companies like Intelsat Sales and others. On January 7, 2005, Intelsat Sales and Juch-Tech ratified a contract entitled the Non-Exclusive Service Agreement No. 04031-000 (“NESA”). See generally NESA ECF No. 68, Ex. 1. The NESA sets forth the terms governing Intelsat Sales’s provision of space segment to Juch-Tech. Pursuant to the NESA, Intelsat Sales and Juch-Tech ratified Intelsat Transponder Service Orders (“Service Orders”), which lay out the specific terms, for Juch-Tech’s leasing of space segment, including pricing, technical specifications, and the length of the leases. The companies entered into multiple Service Orders relating to the leasing of space segment on several different satellites during the course of their contractual relationship. See, e.g., ECF No. 68, Exs. 2-9 (Service Orders). Ail Service Orders, and the amendments and extensions thereto, state that “[t]he Service is subject to the terms and conditions of the Master Service Agreement,” which is the NESA dated January 7, 2005. See, e.g., ECF No. 68, Ex. 3 at 27 (Service Order No. 16227); Ex. 4 at 32 (Service Order No. 15228).

Turning back to the NESA, the agreement includes several provisions relating *55 to when and how Intelsat Sales may terminate the contract and the accompanying Service Orders. Of relevance to deciding Juch-Tech’s motion, the NESA states at Section 8.1(b):

At its sole option, Intelsat may suspend Service or terminate this Agreement or some or all outstanding Service Contracts by giving written notice if the Customer lie., Juch-Tech] ... fails to make payment of any sum due and owing to Intelsat under a Service Contract and such failure continues for a period of 15 days after provision of written notice of such failure by Intelsat.

NESA, ECF No. 68, Ex. 1 at § 8.1(b). The NESA further provides at Section 8.4 that “[i]n the event this Agreement is terminated by Intelsat under this Section 8, it shall mean termination of every then outstanding Service Contract.” Id. § 8.4. Finally, the agreement includes a contractual acceleration damages clause 1 at Section 8.5:

Upon termination of this Agreement (or •a Service Contract) for whatever reason, Intelsat shall no longer be required to provide for any Services and the Customer shall cease using the Services and Satellite Capacity and any outstanding indebtedness of the Customer (under the Agreement or the Service Contract as appropriate) to Intelsat shall become immediately due and payable together with any interest thereupon, provided that in the event that this Agreement is terminated by Intelsat under this Section 8, the amounts payable by the Customer to Intelsat shall include any Charges that would have been payable • in accordance with all outstanding Service Contracts of the Customer so terminated (at the then-current rate), plus the costs of collection[.]”

Id. § 8.5.

On October 6, 2010, Chris Nibecker, a manager at Intelsat Corporation (“Intelsat Corp.”), sent a notice letter to Juch-Tech’s President, Walter Juchniewicz, stating that Juch-Tech was in default under the NESA for the amount of $2,419,865 and informing Juch-Tech that unless the full balance was paid within fifteen days, “Intelsat” was entitled to terminate the agreement under Section 8.1. See Nibecker Letter, ECF No. 75, at 4. This notice was written on Intelsat Corp.’s letterhead, and although it properly described the NESA in the “Re” line by its identification number (No. 04031) and execution date (January 7, 2005), the letter incorrectly stated that the NESA was between Juch-Tech and Intelsat Corp., not Intelsat Sales. See id. On October 8, 2010, Juch-Tech’s Walter Juch-niewicz emailed Chris Nibecker, among others, “formally acknowledging] receipt ... of the email form (sic) Chris.” ECF No. 75, at 9 (Oct. 8, 2010, email from Juchniewicz to Rasmussen, with Nibecker cc’d). Intelsat Sales terminated the NESA and the Service Orders on or around October 28, 2010, more than fifteen days after the Nibecker letter. See ECF No. 59-13, Ex. 11 (various emails between Juch-Tech and Intelsat). The timing of the termination is not presently at issue.

Chris Nibecker was an employee of Intelsat Corp. at all times during the relevant events, see Nibecker Aff., ECF No. 75, at 1, ¶ 2, but he did have interactions with Juch-Tech on behalf of Intelsat Sales regarding billing and collections under the NESA. See id. at 1-2, ¶ 3. Indeed, he was one of the main contacts for Juch-Tech *56 about its billing with Intelsat Sales between 2008 and 2010. See id. According to Nibecker’s affidavit, this is because Intelsat Sales gave the billing department at Intelsat Corp. responsibility for sending invoices to Juch-Tech under the NESA and the Service Orders. 2 See id. Although the exact corporate relationship between Intelsat Sales and Intelsat Corp. is unclear, it is undisputed that: they are separate legal entities; only Intelsat Sales (and not Intelsat Corp.) was a signatory to the NESA; and only Intelsat Sales (and not Intelsat Corp.) was a signatory to the Service Orders. Finally, whereas the Ni-becker letter stated that Juch-Tech was in default for $2,419,865, Intelsat Sales asserts through its discovery responses that Juch-Tech is liable for total damages in the amount of $43,419,032.04 due to its alleged breach of contract. 3 See ECF No. 59-15, Ex. 13 at 8 (Intelsat Sales’s Preliminary Disclosures).

Now before the Court is Juch-Tech’s motion for partial summary judgment.

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Intelsat USA Sales Corp. v. Juch-Tech, Inc., 52 F. Supp. 3d 52, 2014 WL 2930679, 2014 U.S. Dist. LEXIS 88536 (D.D.C. 2014).

52 F. Supp. 3d 52 (Intelsat USA Sales Corp. v. Juch-Tech, Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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