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Netsoft Assocs., Inc. v. Flairsoft, Ltd.

Court of Appeals of Georgia

March 19, 2015

NETSOFT ASSOCIATES, INC.
v.
FLAIRSOFT, LTD

Contract. Houston Superior Court. Before Judge Lukemire.

Burke Lasseter, Kelly R. Burke, Ronald E. Daniels, for appellant.

J. Hatcher Graham, for appellee.

OPINION

Page 66

Miller, Judge.

Netsoft Associates, Inc. brought this action against its business partner Flairsoft, Ltd., alleging, among other claims, that Flairsoft breached a quid pro quo agreement.[1] Flairsoft filed a motion for partial summary judgment, which the trial court granted. Netsoft appeals, contending that the trial court erred in finding that there was insufficient evidence to raise a factual question regarding whether the parties entered into an independent and enforceable quid pro quo agreement. For the reasons that follow, we reverse.

On appeal from a grant of summary judgment, we conduct a de novo review of the evidence to determine if there exists a genuine issue of material fact and whether the undisputed facts, viewed in the light most favorable to the nonmoving party, entitle the movant to judgment as a matter of law.

(Citation omitted.) Capital Color Printing v. Ahern, 291 Ga.App. 101, 102 (661 S.E.2d 578) (2008).

So viewed, the evidence shows that prior to 2009, Netsoft was a prime contractor who provided skilled labor to the federal government and other entities at a specified contractual price. Netsoft qualified as a prime contractor based on its certification under the [331 Ga.App. 361] Small Business Administration's 8(a) program (" SBA 8(a)" ).[2] In July 2009, Netsoft's majority shareholder, who qualified the company for its SBA 8(a) status, suddenly passed away, leaving Netsoft without the ability to continue to obtain prime federal contracts. Accordingly, Netsoft began looking for a qualified SBA 8(a) partner.

In 2009, Netsoft entered into a business relationship with Flairsoft, a qualified SBA 8(a) company. Netsoft agreed to introduce Flairsoft to important government personnel and key contractors at Robins Air Force Base (AFB), and to assist Flairsoft in obtaining facility and security clearances. In exchange, Netsoft would derive income from any contracts that Flairsoft obtained as a result of introductions made by Netsoft. Thereafter, in October 2009, the parties entered into a Teaming Agreement and an addendum to that agreement (hereinafter the " 2009 Teaming Agreement" ), under which

Page 67

the parties agreed to share work arising from Netsoft's existing government contract and all subsequent modifications to that contract.

With regard to future contracts, the 2009 Teaming Agreement provided that the parties would join forces to determine the best course of action in the bidding process. The 2009 Teaming Agreement also provided that it was " an ongoing agreement contemplating future contract actions whereby Netsoft and Flairsoft would join forces to bid, win and share in contracts where there [was] a mutually agreed upon course of action." Netsoft, however, conceded at the hearing in this case that the 2009 Teaming Agreement " had met its purpose" and " was completed."

After Netsoft lost its SBA 8(a) status, Netsoft and Flairsoft entered into subcontract agreements whereby Netsoft provided specific employees to fulfill a maximum of 49 percent of Flairsoft's work requirements under its prime contracts with the United States Air Force. Since Flairsoft was the SBA 8(a) prime contractor, ...


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