United States District Court, D. Connecticut
ORDER GRANTING IN PART AND DENYING IN PART
DEFENDANT'S MOTION FOR SUMMARY JUDGMENT
JEFFREY ALKER MEYER UNITED STATES DISTRICT JUDGE
ARMOUR Capital Management LP (ACM) and defendant SS&C
Technologies, Inc. (SS&C) are embroiled in litigation
over the failed implementation of financial services software
that SS&C sold to ACM. In this latest round of their
battle, SS&C moves for summary judgment on all of
ACM's claims. Although I will grant SS&C's motion
as to ACM's breach of contract claim, I will deny the
motion as to ACM's remaining claims.
a Florida-based registered investment advisor that focuses on
mortgage-related securities. SS&C provides software and
related services to the financial industry from its
headquarters in Connecticut. I take the facts here from both
parties' briefs and their Local Rule 56 statements of
origins of the parties' dispute dates to early 2014.
SS&C was by this time an established provider of
financial services software, including the CAMRA software
that it had developed in 1988. See Doc. #177-1 at 2-3
(¶¶ 3-4, 6). ACM was then a 19-employee mortgage
real estate investment trust (REIT). See Doc. #177-1 at 25
(¶ 65). ACM managed assets for the similarly-titled
ARMOUR Residential REIT, Inc. (ARR), as well as for JAVELIN
Mortgage Investment Corporation (which was later purchased by
ARR). Id. at 7 (¶ 16).
it had worked with some REITs in the past, SS&C announced
in April 2014 that it would form a new group that would
specialize in serving REITs. See Doc. #177-1 at 5 (¶
13); Doc. #176-8 at 2. In May 2014, Jim Mountain, who held
himself out as the CFO of both ARR and Javelin, contacted
SS&C. Doc. #177-1 at 8 (¶ 21). He and his colleague
Mark Gruber then met in June 2014 with SS&C
representatives, including business development director
Dennis Moore. Id. at 9 (¶¶ 22-23). At the
meeting, SS&C presented a PowerPoint discussing various
aspects of itself, its customers, and CAMRA, and Moore then
followed up with Mountain and Gruber. Id. at 9-11
between SS&C and the ARMOUR entities continued that
summer and fall, including several “proofs of
concept” to demonstrate tests of CAMRA on ARR's
data. Id. at 11-12 (¶ 32). In late August 2014,
SS&C met with ACM to show a PowerPoint purporting to
demonstrate the first proof of concept of the CAMRA system
and to introduce ACM to several SS&C CAMRA staffers.
Id. at 12-14 (¶¶ 34, 37). Included in that
group of staffers was SS&C professional services team
member Shiv Sivadas. Id. at 13 (¶ 34). SS&C
then discussed further aspects of CAMRA implementation with
ACM information technology staff in September 2014.
Id. at 14 (¶ 38).
mid-November 2014, SS&C provided ACM with a
“Comprehensive Mortgage REIT Software and Operational
Support Services Proposal, ” ibid. (¶ 39), which
contained various details about the potential implementation
of CAMRA, see Id. at 14-15 (¶¶ 39-41);
Doc. #176-29 at 10, 13. By December 2014, Moore emailed
Mountain, Gruber, and their colleague Joanna Terry to alert
them that he and SS&C's Jeff Fecteau had been working
“to prepare an implementation estimate for
transitioning ARMOUR to our CAMRA solution.” Doc.
#177-1 at 16 (¶ 43). Two days later, he sent ARR and ACM
a “draft implementation budget, ” and SS&C
then sent a revised proposal the following day. Id.
at 16-17 (¶¶ 45-48). SS&C proposed a call with
Mountain to discuss “what constitutes the
‘ordinary course of business.'” Id.
at 17-18 (¶ 50). The parties have argued about the
nature, meaning, and import of the statements by SS&C
throughout these negotiations.
SS&C finally concluded their negotiations and signed what
they call the “Master Agreement” on December 19,
2014. Id. at 17 (¶ 51). The Master Agreement
specifies certain limitations of consequence to this action,
including the following clauses:
Entire Agreement. This Master Agreement (including
any attachments and addenda hereto) contains the entire
agreement of the parties with respect to the subject matter
hereof and supersedes all previous communications,
representations, understandings and agreements, either oral
or written, between the parties with respect thereto.
Sections 6.2.1 and 6.2.5:
Disclaimer. Except as set forth in this Master
Agreement or a relevant attachment, SS&C makes no
warranties, whether express, implied, or statutory, regarding
or relating to the Software or Documentation. SS&C
specifically disclaims all implied warranties of
merchantability and fitness for a particular purpose with
respect to the software and the Documentation.
No Other Warranty. Any written representation or
warranty not expressly contained in this Master Agreement or
a relevant Attachment or Work Request is not authorized or
valid. No employee, agent, representative or affiliate of
SS&C has authority to bind SS&C to any oral
representations or warranty concerning the Software.
Exclusion of Consequential Damages and Absolute
Limitation on SS&C's Liability. SS&C is not
liable for any indirect, special, incidental or consequential
damages of any kind, including without limitation, loss of
profits, loss of use, business interruption, loss of data, or
cost of cover in connection with or arising out of the
furnishing, performance of any services under the Master
Agreement, any Attachment or any Work Request, or use of the
Software furnished hereunder . . . .
No Third Party Beneficiaries. SS&C shall have no
contractual or other obligations or liability to (i) ARMOUR
Residential REIT, Inc. or (ii) JAVELIN Mortgage Investment
Corp. directly or as third party beneficiaries of this Master
Agreement or any other agreement between SS&C and Client.
Id. at 18-19 (¶ 52).
Master Agreement had several attachments: Attachment B-1,
which identified specific “Hosting, Process Automation
and Data Management Services” that SS&C would
provide; and “Work Request One, ” which
identified specific “Initial Implementation
Services.” Id. at 19 (¶ 53). Work Request
One noted that SS&C would provide services “in
support of Client's implementation of the Software,
” and listed “Assumptions, ” including a
“Project Duration of 4-6 months” and an
“Applicable Rate” that SS&C would
“provide an estimated 1, 850 hours of support in
relation to the services described . . . at a rate of $225
per person per hour.” Ibid. (¶ 54).
its relationship with SS&C, ACM also maintained a
relationship with ARR and Javelin. ACM provided services to
both ARR and Javelin under what it calls “Management
Agreements, ” which state that “[ACM] is
authorized to retain, for and on behalf of the REIT, the
services of third parties.” Id. at 20 (¶
56). The agreements also provide that “costs and
expenses related to the retention of third parties shall be
the sole cost and expense of the REIT.” Ibid. The