## Facts

- Joe Cook and related entities provided consulting and funding to InvestorDigs, LLC and its affiliate, Onit Solutions, LLC, whose principal was Walter Charnoff.
- In July 2008, Cook agreed to provide 120 days of consulting services in exchange for a 2% ownership interest in InvestorDigs.
- Between July and October 2008, InvestorDigs received $450,000 from plaintiffs; plaintiffs characterized the transfers as loans, while defendants characterized them as consideration for ownership interests.
- InvestorDigs occupied commercial space owned by Focus Business Park, LLC; no formal written lease was executed, but an email described proposed lease terms and InvestorDigs made some payments.
- After the relationship deteriorated, the parties met on January 21, 2009 to discuss unwinding their arrangement.
- Plaintiffs alleged a binding settlement was reached at that meeting and memorialized through subsequent emails listing purported settlement terms, including a five-year note; defendants denied any final agreement.
- Plaintiffs filed suit asserting, among other claims, breach of an alleged settlement agreement, breach relating to the $450,000 transfers and the lease, unjust enrichment, and accounting; defendants asserted counterclaims including contract and tort-based theories.
- After Cook filed a Chapter 11 petition, the case proceeded in federal court, and defendants moved for summary judgment.

## Issues

1. Whether the alleged January 2009 settlement was enforceable under Colorado law, including the statute of frauds’ writing and signature requirements, based primarily on email communications.
2. Whether summary judgment was proper where the parties disputed whether the $450,000 transfers were loans or equity purchase payments.
3. Whether lease-related claims were barred by the statute of frauds or otherwise failed as a matter of law given the absence of a signed written lease.
4. Whether disputed facts precluded summary judgment on equitable claims such as unjust enrichment and accounting.

## Decision

- The court granted summary judgment to defendants on plaintiffs’ breach-of-contract claim based on the alleged settlement agreement and dismissed that claim.
- The court denied summary judgment on claims and counterclaims turning on disputed facts about the $450,000 transfers, including whether they were loans or equity.
- The court denied summary judgment on lease-related claims because factual disputes remained regarding the existence and terms of any lease and the effect of the parties’ conduct.
- The court denied summary judgment on plaintiffs’ equitable claims (including unjust enrichment and accounting) as alternative theories given disputed or uncertain contractual rights.

## Legal Principles

- An enforceable contract requires mutual assent to sufficiently definite material terms; ongoing negotiations and unresolved essential terms defeat formation as a matter of law.
- For agreements subject to Colorado’s statute of frauds, enforceability generally requires a writing containing material terms and a signature by the party to be charged; electronic communications may be capable of satisfying these requirements only if they clearly evidence a final agreement.
- Summary judgment is improper where the record contains genuine disputes of material fact about the parties’ intent and the terms governing transfer of funds (e.g., loan versus capital contribution).
- Lease obligations may be supported by written communications and conduct, but enforceability and any statute-of-frauds defenses may depend on fact-bound questions, including whether the writings capture material terms and whether exceptions such as part performance apply.
- Unjust enrichment and related equitable remedies may proceed in the alternative when the existence, scope, or enforceability of an alleged contract is disputed.

## Conclusion

The court rejected enforcement of the purported email-based settlement because the writings did not establish a final agreement on material terms, but it allowed the litigation to proceed on competing theories about the $450,000 transfers, the lease arrangement, and alternative equitable claims due to unresolved factual disputes.


Buckles Mgmt., LLC v. InvestorDigs, LLC, 728 F. Supp. 2d 1145 (D. Colo. 2010)