Habr v. RXMAPPER, LLC

Summary

This is Pretrial Order No. 3 issued by the United States District Court for the Northern District of California in Habr v. RXMAPPER, LLC. The order revises the trial schedule and addresses proposed jury instructions concerning fraud damages, mitigation, conversion of source code, and the defendants’ Lanham Act claim. The order is dated July 18, 2025.

Holdings

1. Plaintiffs' fraud claim concerning the promise of equity in RxMapper, LLC is governed by California Civil Code section 3343(a), and plaintiffs may not recover benefit-of-the-bargain or expectation damages absent a showing of both a fiduciary relationship and intentional misrepresentations. Because plaintiffs had not shown a fiduciary duty, the court denied their requested instruction on expectation damages and directed that proposed instruction 42.1-D be given.
2. Defendants may present mitigation of damages as an affirmative defense for the jury's consideration because the defense raises factual issues concerning application of the law. Proposed jury instruction 34 will be given.
3. At the pretrial stage, the court preliminarily determined that source code may be the subject of a conversion claim and that defendants may submit their conversion counterclaim to the jury if the trial evidence satisfies the applicable three-part test. Proposed jury instructions 62-64 were preliminarily allowed.
4. The court deferred until the charging conference whether the trial evidence would warrant a jury instruction on defendants' Lanham Act claim based on actual confusion; the relevant instructions would be included preliminarily if sufficient evidence were presented.
5. Plaintiffs were denied leave to file a summary-judgment motion because the deadline had expired on November 22, 2024.

Questions Presented

1. Whether plaintiffs' fraud claim involving a promise of equity could support benefit-of-the-bargain or expectation damages.
2. Whether defendants could present mitigation of damages as an affirmative defense for the jury's consideration.
3. Whether source code could be the subject of a conversion claim and be submitted to the jury if the evidence satisfied the applicable test.
4. Whether the evidence would support a jury instruction on defendants' Lanham Act claim based on actual confusion.
5. Whether plaintiffs could file a summary-judgment motion after the expired deadline.

Disposition

other