HUNTING SOLUTIONS LIMITED LIABILITY COMPANY D/B/A EXTREME HUNTING SOLUTIONS, Plaintiff-Appellant,
WILLIAM L. KNIGHT, Defendant-Appellee.
from the Iowa District Court for Appanoose County, Daniel P.
plaintiff appeals the district court's denial of its
unjust enrichment claim.
Bradley M. Grothe of Craver & Grothe, LLP, Centerville,
Timothy J. Zarley and Joshua J. Conley of Zarley Law Firm,
P.L.C., Des Moines, for appellee.
Considered by Danilson, C.J., and Vogel and Vaitheswaran, JJ.
Solutions, L.L.C., d/b/a Extreme Hunting Solutions (EHS),
filed suit against William Knight, asserting various causes
of action arising from an unsuccessful business relationship.
The district court rejected EHS's claims, along with
Knight's counterclaims, following a bench trial. EHS
asserts on appeal the district court was wrong to deny its
unjust enrichment cause of action because it bestowed a
benefit onto Knight by developing the prototype of his
product and it should be compensated for that benefit. Knight
asserts EHS conferred no benefit onto him because the product
that EHS developed no longer complies with his patent. For
the reasons stated below, we affirm the district court's
Background Facts and Proceedings.
invented and patented a product he called a "Rattle
Stick for Attacking Animals, " which he envisioned would
be used by hunters to attract deer by simulating the sound of
the antlers of male deer engaged in a fight. The prototype
also included a "grunt tube" with a reed in the
handle of the unit, which could be used to vocalize a deer
call. However, Knight lacked the resources to manufacture his
product at an affordable price point to sell to consumers. In
order to address this problem, Knight met with Randall
Ferman, CEO of EHS, in April 2013.
asserted that, at this initial meeting, he informed Knight
that, if EHS were to invest in the Rattle Stick, EHS must
have the exclusive right to sell the product. Knight denies
any such discussion occurred. The two moved forwarded with
developing a prototype of Knight's Rattle Stick through a
company Ferman had used in the past. Knight provided Ferman
with computer drawings of his patented product along with a
video to demonstrate how it would be used. During the
development of the prototype, Ferman wanted to change the
grunt tube to a snort wheeze, a different vocalization call
for attracting deer. Knight opposed the change but testified
he "lost that argument, " and a snort wheeze
replaced the grunt tube in the prototype.
August, Ferman contacted a mold company to create a mold so
the product could be manufactured. Because EHS would be
paying the $27, 000 cost of the mold, Ferman obtained
Knight's final approval on the appearance and function of
the Rattle Stick before ordering the mold. At this time,
Knight informed Ferman that, before Ferman ordered the mold,
the two should work out a written agreement, but Ferman went
ahead and ordered the mold without a written agreement.
December, Ferman testified he had a meeting with Knight, and
the two were on speaker phone with Ferman's attorney,
giving him instructions to draft up the already agreed upon
licensing agreement. Knight denied being present when Ferman
contacted his attorney, and Ferman's attorney could not
verify that anyone but Ferman was present during the phone
call. Knight did remember a meeting in Ferman's office in
December where Ferman provided him with a written licensing
agreement that provided EHS with the exclusive right to sell
the product. Knight testified this was the first time he had
heard Ferman use the term "exclusive" with respect
to selling the Rattle Stick. Knight took the agreement to his
attorney to review.
Ferman and Knight attended a hunter's trade show in
January to develop interest in the product. Marketing and
packaging materials were created and paid for by EHS, and a
few products were available for demonstration purposes from
the mold company. Knight testified that, when they were at
the trade show, Ferman was notified by his U.S. manufacturer
that the mold created in China would not work for production
in the United States because it did not have "cooling
returning from the trade show, Knight presented Ferman with a
counteroffer agreement, prepared by Knight's attorney,
that provided EHS's right to sell the product was
nonexclusive. Ferman rejected this counteroffer, and the
parties briefly discussed Ferman purchasing Knight's
patent. But ultimately, the business relationship dissolved,
and in May 2014, Ferman, on behalf of EHS, filed suit for the
time and money invested in developing the Rattle Stick.
Ferman estimated EHS spent nearly $35, 000 for the prototype,