Electrology Laboratory, Inc. v. Kunze (169 F. Supp. 3d 1119, 2016)

FINDINGS OF FACT, CONCLUSIONS OF LAW AND ORDER

RAYMOND P. MOORE, United States District Judge

Defendant Larry Paul Kunze a/k/a- Lorenzo Kunze sold his “family” business (Plaintiff Electrology Laboratory, Inc. (“ELI”), d/b/a ROCKY MOUNTAIN LASER COLLEGE (“RMLC”)) but couldn’t give it up. So, as the evidence revealed, even while negotiating the sale of ELI to the purchasers (Third-Party Defendants Ray Fluken, Jody Riggs Fluken, and Jessica Riggs, collectively, the “Fluken-Riggs”), Mr. Kunze was trying to figure out how to-continue the same business he was selling. The purchasers of the business took exception to Mr. Kunze’s actions, and rightly so. The Fluken-Riggs and ELI (collectively, “Plaintiffs’) brought this action seeking to recover damages caused by the actions of Mr. Kunze and his son, Defendant Larry Paul Kunze, Jr. (“Mr. Kunze, Jr.”) (Mr. Kunze and Mr. Kunze, Jr., collectively, “Defendants”). In response, Mr. Kunze filed counterclaims and third-party claims asserting it is Plaintiffs who are at fault. The Fluken-Riggs returned with third-party counterclaims against Mr. Kunze. After examining the evidence, considering the parties’ stipulations (including the stipulations dismissing certain claims), evaluating the credibility of the witnesses, and analyzing the law, and being otherwise fully advised, the Court finds relief is warranted — to both sides. The Court finds in favor of Plaintiffs, in whole or in part, on eight of their 11 claims for relief. The Court finds Mr. Kunze’s credibility sorely lacking and is unpersuaded by his testimony, but nonetheless finds he is entitled to relief on his counterclaim and third-party claim for breach of the Promissory Note given in partial payment for the purchase of ELI. The Court’s rationale is as follows.

I.FINDINGS OF FACT

To the extent that any conclusions of law are deemed to be findings of fact, they are incorporated herein by reference as findings of fact.

A. Background

1. ELI is a Colorado corporation with its principal place of business at 651 Garrison St., Suite 200, Lakewood, Colorado. ELI does business as “ROCKY MOUNTAIN LASER COLLEGE” and RMLC, and operates on a fiscal year which runs from February 1st to January 31st.

2. Mr. Kunze is a Colorado citizen who, during the relevant time period, resided at 16545 W. Bayaud Dr., Golden, Colorado, less than 10 miles from ELL Mr. Kunze operated ELI in its current form since at least the 1990s. Mr. Kunze was the sole shareholder of ELI until he sold it to the Fluken-Riggs. ELI was, essentially, a family business.

3. In addition to owning and operating ELI, Mr. Kunze also did business under the name “American Laser College.”

4. Mr. Kunze, Jr. is Mr. Kunze’s son and, during the relevant time period, also a Colorado citizen and resident. Mr. Kunze, Jr. worked for ELI under his father’s ownership and briefly thereafter.

5. Ray Fluken and Jody Riggs Fluken are husband and wife, and Colorado citizens. Jessica Riggs, also a Colorado eiti-zen, is Mrs. Fluken’s daughter and Mr. Fluken’s stepdaughter.

B. ELI — Prior to Mr. Kunze’s sale to the Fluken-Riggs

6. Under the ownership of Mr. Kunze, ELI earned income primarily from three sources — its occupational school, its clinic, and the sale of laser equipment.

(i) Through its occupational school known as “ROCKY MOUNTAIN LASER COLLEGE” and RMLC, ELI provided aesthetic laser use education and training to students not only onsite at its Lakewood facility but also offsite in other states;

(ii) Through its clinic, ELI provided aesthetic laser services to clients; and

(Hi) Through its former and current students, ELI earned income from the sale of laser equipment.

7. ELI’s laser education course consisted of 40 hours of training through a curriculum approved and regulated by the Colorado Department of Higher Education, Division of Private Occupational Schools (“DPOS”). ELI’s students received RMLC written materials and hands-on training on laser equipment in the course taught by Mr. Kunze.

8. In order to market classes and sell laser equipment, ELI maintained a customer list, identifying students who took the RMLC laser education course. The list changed over time to reflect additional enrollments. The student information was exchanged only between students within class, not to other classes and their students. ELI did maintain some precautions in keeping its student information confidential, such as keeping the files under lock and key and keeping the lists password protected on the computer system.

9. Sometime in the 1990s, ELI began awarding its students “Certified Laser Specialist” or “CLS” certificates, showing they were trained at ROCKY MOUNTAIN LASER COLLEGE.

10. In connection with its business, ELI has long used the marks “ROCKY MOUNTAIN LASER COLLEGE,” “RMLC,” “Certified Laser Specialist,” and “CLS.” ELI advertised ROCKY MOUNTAIN LASER COLLEGE and RMLC extensively through the internet and on its course materials.

11. For a significant period of time, ELI used laserlaser.com to advertise its goods and services, e.g., its clinic and educational course. ELI used this site to promote ROCKY MOUNTAIN LASER COLLEGE and to drive business to ELL

12. Although laserlaser.com was the primary source of ELI’s advertisement, it also used www.laser-college.com,www.no-hair.com, www.yes-hair.com, www.no-vein. com, www.polyfacial.com, wwwlaser-white. com, www.no-tattoo.com, and www.no-wrinkle.com (the eight sites, collectively, the “Websites”). ELI paid for the cost of servicing at least some, if not all, of the Websites and laserlaser.com through December 31, 2008 or 2009, even though Mr. Kunze owned them and registered them in his name individually.

13. Through his many years in the industry and in teaching the RMLC laser education course, Mr. Kunze was well known in the aesthetic laser education industry, and touted his experience on the internet, including laserlaser.com. While Mr. Kunze was a “gifted” teacher, he was not as educated or experienced as he touted. While ELI’s business and Certified Laser Specialist were recognized by some in the industry, they were also not as Mr. Kunze represented. Instead, Mr. Kunze intentionally made numerous misrepresentations on the laserlaser.com website, including misrepresentations concerning the extent of his education, experience, and certifications; the number of CLS certifications that ELI had • awarded to RMLC students; and that Certified Laser Specialist was ■ a registered trademark when it was not.

14. It was through laserlaser.com that Ms. Riggs found ELI in October 2007 and took the RMLC course taught by Mr. Kunze. Ms. Riggs received course materials but was not restricted in any way as to its use. ELI placed no restrictions on the use of its curriculum by its students, during or after the course was completed.

15. In January 2008, Ms. Riggs began working for ELL

16. In June 2008, Mr. Kunze submitted a trademark application for the mark “CLS (Certified Laser Specialist)” (Ex. 124), to be registered in the Principal Register, stating the mark was first used as of July 28, 1997. Mr. Kunze had a specimen prepared for á Certified Laser Specialist certificate, with the date July 24, 1997. (Ex. 57.) But, Mr. Kunze never completed the registration process. Nonetheless, Mr. Kunze continued to represent to the public that the mark was in fact registered.

C. The Fluken-Riggs’ purchase of ELI

17. Sometime in 2008, Mr. Kunze approached Ms. Riggs and others to see if they were interested in buying ELI. Over the course of 2008 and 2009, the Fluken-Riggs investigated purchasing ELI from Mr. Kunze for $1 Million. During this process, Mr. Kunze made a number of representations to the Fluken-Riggs that were untrue, including, as material to this case:

(i) That Body Laser Solutions (“BLS”) was owned by .a couple of doctors when, in fact, Mr. Kunze owned BLS, and that a $23,383.00 accounts receivable from BLS was collectible;

(ii) That six THERMO-Los (electrolysis machines) in ELI’s inventory had a fair market value and cost of $2,500.00 each when, in fact, the actual cost was $875.00 each; and

(iii) That Certified Laser Specialist was a registered trademark, when it had never been registered.

18. Mr. Fluken was skeptical about paying $1 Million for ELI and believed Mr. Kunze overstated or exaggerated how much money the business made. Mr. Fluken received a schedule of fixed assets and inventory stated to be worth $455,248.00 (Ex. 41), but he did not believe they were worth that much. So, Mr. Kunze asked ELI’s accountant for financial information and asked Ms. Riggs for backup documentation to check the accuracy of ELI’s fi-nancials.

19. Mr. Fluken also relied on Ms. Riggs to verify what equipment was on the premises and what was owned or on loan, including two working MediDerms on loan from the manufacturer.

20. Meanwhile, in about November 2009, Mr. Kunze met with Arthur Barbera, an owner of a pre-owned laser equipment company, to discuss laser related business opportunities, including selling lasers to former and current students of ELL Mr. Barbera was introduced to Mr. Kunze by Mike Sparks of Cynosure, a manufacturer of esthetic and medical equipment. Mr. Sparks sold laser equipment to ELI’s students.

21. By December 2009, Mr. Kunze and the Fluken-Riggs agreed to a stock purchase of ELI. The purchase price- was $1 Million, to be paid with an initial deposit of $10,000.00, a loan from American Bank of Commerce (“ABC Bank”) for $650,000.00, a $250,000.00 Promissory Note to Mr. Kunze, and $90,000.00 from the Fluken-Riggs.

22.Although the parties discussed'transferring the Websites to ELI, no agreement was ever reached. Instead, Mr. Kunze and the Fluken-Riggs agreed to a transfer of ELI’s stock, as memorialized in that certain Purchase and Sale Agreement (“PSA”) dated December 22, 2009. (Ex. 2.) As relevant to the issues, the PSA provides as follows:

(i) The purchase price was $1 Million, with $250,000.00 to be paid via a 5-year Promissory Note to be made by the Fluken-Riggs and ELI;

(ii) Closing was to occur by December 23, 2009, unless otherwise mutually extended;

(iii) All records shared by ELI with the Fluken-Riggs in anticipation of the stock purchase were “deemed confidential trade secrets and proprietary information of [ELI],” were to be returned to ELI and Mr. Kunze if the stock purchase was not completed, and ELI and Mr. Kunze could sue for injunctive and other relief in the event of the breach of such terms;

(iv) ELI and Mr. Kunze would enter into an Independent Contractor Agreement;

(v) The PSA contained the entire understanding and agreement between the . parties;

(vi) That documents and information received were for informational purposes only, and that Mr. Kunze did not represent, warrant, or guarantee the contents, conclusions, or opinions “contained therein”;

(vii) If the Fluken-Riggs failed to make any payment or perform as required by the PSA within the time required, Mr. Kunze’s “sole remedy” was to terminate the PSA — and all other remedies were waived and released;

(viii) If Mr. Kunze defaulted, refused, or was unable to perform as required by the PSA within the time required, the Fluken-Riggs “may” terminate the PSA and have all monies paid returned — and all other remedies were expressly waived and released; and

(ix) With exceptions not relevant here, Mr. Kunze was precluded from disclosing or issuing any statement regarding the PSA or the sale of ELI.

23. On December 23, 2009, Mr. Kunze and ELI entered into an Independent Contractor Agreement (“ICÁ”) which provides, in relevant part:

(i) The term of the ICA would be for five years, starting on December 23, 2009, unless ELI terminated the agreement for cause or agreed to release Mr. Kunze, or by mutual agreement;

(ii) During the term of the ICA, Mr. Kunze was required to use his best efforts to provide laser removal education or training and aesthetic laser services to students or customers of ELI;

(iii) Mr. Kunze would be “employed” as the College Director, with certain duties, including conducting four (4) classroom sessions outside of ELI’s facility each year, and acting as ELI’s liaison and consultant with laser manufacturers;

(iv) ELI would pay Mr. Kunze 10% commission on gross sales generated by college enrollment;

(v) Mr. Kunze, in acting as ELI’s independent contractor, would conduct his business with the “highest ethical standards,” “avoid deceptive, misleading, unethical practices,” “make no false representations,” and conduct business in a manner which reflected favorably on the business and the good name, goodwill and reputation of ELI;

(vi) Mr. Kunze agreed not to compete during the term of the ICA and for two years after its termination, within twenty-five miles of ELI’s offices. Mr. Kunze agreed that he would not “solicit, offer or provide laser hair removal education or training or aesthetic laser services” (emphasis added) to any client or prospective client of ELI within that geographic location;

(vii) Even where permitted to teach for his own account, there was no provision authorizing Mr. Kunze to use ELI’s curriculum or marks to do so; and

(viii) If a business opportunity came to Mr. Kunze’s attention that conflicted with ELI’s operations, ELI would not unreasonably withhold ' approval to allow Mr. Kunze to pursue this opportunity.

24. Mr. Kunze, ELI, and the Fluken-Riggs entered into a Promissory Note for $250,000.00 dated December 22, 2009, which provides, in relevant part:

(i) Generally, the Promissory Note is “subordinate” to the “first Note of Borrower [ELI and the Fluken-Riggs], payable to ABC Bank,” as long as there is an outstanding balance owed to ABC Bank;

(ii) Seven percent (7%) interest on the unpaid balance starts to accrue on December 23, 2009;

(iii) The first payment of principal and interest (“P & I”) in the amount of $35,000.00 is due and payable January 1, 2012. The amount of $7,719.00 P & I is due per month thereafter on the 10th of each month, starting February 10, 2012, until January 1, 2015, when “notwithstanding any other language contained in the [Promissory] note,” the entire balance due under the note is due in full;

(iv) Its terms and conditions are subject to the conditions of the “Employment Agreement,” ie., the ICA;

(v) For every year in which Mr. Kunze did not complete his obligations under the ICA, and by his willful termination and breach of the ICA, $50,000.00 is deducted from the Promissory Note for each year of termination, up to $200,000.00; and

(vi) Plaintiffs will owe a late charge of 10% of any payment not received within five (5) days after the payment is due.

25. The Promissory Note also provides for an increase in the interest rate to 14% from the date the note is accelerated. No notice of acceleration was ever given.

D. Mr. Kunze and the FIuken-Riggs’ Relationship Crumbled Not Long After the Sale of ELI

26. ELI’s business is run with the assistance of only a few people, essentially consisting of employees/officers the FIuken-Riggs, employee Mr. Kunze, Jr., an administrator, and independent contractor Mr. Kunze. After their purchase of ELI, the FIuken-Riggs made a number of changes or additions to ELI.

27. They developed a new website for ELI which was up and running by early 2011. Until then, ELI continued to use the laserlaser.com website to direct traffic to its business, which ELI made no payment to maintain.

28. They revised ELI’s course materials over time, and ELI now requires students to sign an agreement acknowledging they cannot use the ROCKY MOUNTAIN LASER COLLEGE materials outside of the class.

29. They took a number of measures to protect the business and its data, including changing the passwords, acquiring a password protected third-party accounting system, and putting in a third-party scheduler.

30. They maintain the confidentiality of ELI’s customer list/information, which is updated with new clients and new students. ELI does not share the information with outsiders and has password protection on the computer system which contains the list.

31. For about the first nine months of 2010 ELI was making money and increasing its student count under the FIuken-Riggs’ ownership. Mr. Kunze was conducting classroom sessions at the Lakewood facility. Nonetheless, when ELI asked Mr. Kunze to conduct offsite classes, he refused. Thus, he did not conduct four classroom sessions each year on behalf of ELI outside of its Lakewood facility.

32. Instead, in or about October 2010, Mr. Kunze began demanding that he be released from the ICA. ELI refused to do so. Unbeknownst to Plaintiffs, Mr. Kunze was starting to or already actively improperly competing with ELI. It was also about this time period (November 2010) that Messrs. Barbera and Sparks formed Quanta, a seller of new laser equipment.

33. Thus, in December 2010, Mr. Kunze asked an ELI employee (who also worked for ELI under Mr. Kunze’s ownership) to provide him with an updated student information list so that he could sell lasers to ELI’s former and current students.

34. Also about this time period, ELI increased its advertised prices for its laser education course from $4,000.00 to $6,000.00. Notwithstanding this advertised price increase, ELI provided discounts to students for a variety of reasons.

35. In January 2011, Mr. Kunze taught four students (employees of former ELI student Martha Livermore) in Houston, Texas. Ms. Livermore contacted ELI at its Lakewood facility, looking for Mr. Kunze to teach a class and issue ROCKY MOUNTAIN LASER COLLEGE certificates to her employees. Mr. Kunze offered to teach the class, at Ms. Livermore’s location in Texas. For Ms. Livermore, what was important was receiving a certificate from ROCKY MOUNTAIN LASER COLLEGE and being taught by Mr. Kunze. Ms. Livermore thought the Certified Laser Specialist certification was important because it was represented as such by Mr. Kunze.

36. Ms. Livermore’s employees thought they were taking a ROCKY MOUNTAIN LASER COLLEGE course, but they were not. Instead, Mr. Kunze taught a shorter class for his own business, American Laser College. Nonetheless, he used ELI’s ROCKY MOUNTAIN LASER COLLEGE marks and curriculum as if they were his own. He handed out ROCKY MOUNTAIN LASER COLLEGE business cards, and used ROCKY MOUNTAIN LASER COLLEGE interchangeably with American Laser College such that the students thought the entities were the same. He awarded those students CERTIFIED LASER SPECIALIST certificates, and issued the certificates under ROCKY MOUNTAIN LASER COLLEGE’S name. Mr. Kunze backdated the certificates as if they were issued in 2010, when they were not; he put a stamp on those certificates implying the certificate or course was sanctioned by the Texas Department of Education when it was not.

37. Mr. Kunze received $4,000.00 for teaching the class but did not notify ELI or offer to share any of those earnings with ELI, despite the fact that his offer to provide the course was made within 25 miles of ELI’s office. And, despite the fact that he used ELI’s curriculum and marks and represented he was teaching on behalf of ROCKY MOUNTAIN LASER COLLEGE.

38. In competition with ELI, using ELI’s information, Mr. Kunze sold lasers for Quanta to customers of ELI. By February 2011, Mr. Kunze sold his first laser for Quanta, earning about $5,000.00 in commissions. Thereafter, during the 1st quarter of 2011, Mr. Kunze sold lasers earning additional commissions of $15,000.00.

39. Without Plaintiffs’ knowledge, in March 2011, Mr. Kunze sought to register “Certified Laser Specialist” as his trademark.

40. In addition, Mr. Kunze disclosed the fact he sold ELI to a number of third-parties and made disparaging remarks about ELI and Mr. Fluken and their running of the business. Due to Mr. Kunze’s negative remarks about ELI and Mr. Fluken, Ms. Livermore took her business elsewhere, hiring another instructor to train her students in Houston. Ms. Liver-more had four students trained by the new instructor and, at the time of her deposition, one more scheduled, for a total of five students. These students use CLS and CLT designations as part of their credentials.

41. Also during this time period, Mr. Kunze continued seeking to terminate his relationship with ELI, including “threatening” to resign. Mr. Kunze wanted to work with Messrs. Sparks and Barbera in selling lasers to ELI’s customers and conducting competing laser education classes.

42. With Mr. Kunze unwilling to continue with the parties’ current working relationship, on Monday, April 4, 2011, ELI and Mr. Kunze entered into an amendment of the ICA (the “Amendment”). As relevant to this lawsuit, the Amendment provides the following would govern the parties’ relationship in the future:

(i) Mr. Kunze would be allowed to use ROCKY MOUNTAIN LASER COLLEGE’S name on the laserlaser.com website, but Mr. Kunze would remove pricing and scheduling information and would provide a link to ELI’s website;

(ii) Mr. Kunze would be allowed to provide independent training off-site and use the ROCKY MOUNTAIN LASER COLLEGE approved curriculum and issue a certificate of completion, but would not be allowed to issue a Certified Laser Specialist certificate. In order to obtain a Certified Laser Specialist certificate, the students would have to receive further training at ELI’s facility. ELI would receive a 10% commission of the tuition for such off-site classes;

(iii) Mr. Kunze would be allowed to work with aesthetic laser manufacturers and resellers with no restrictions; and

(iv) If Mr. Kunze taught classes for ELI throughout its fiscal 2011 class schedule (February 1, 2011 to January 31, 2012), he would be entitled to the second year of $50,000.00 earned buyout in accordance with the Promissory Note.

43. In effect, by its terms, the Amendment also amended the Promissory Note.

44. Mr. Kunze, however, did not comply with the Amendment.

45. First, Mr. Kunze did not teach classes for ELI throughout the 2011 fiscal year. Instead, unbeknownst to Plaintiffs, Mr. Kunze was improperly competing with ELI.

46. Mr. Kunze taught laser education courses through ANMM d/b/a The Laser Center for Education, a company formed by Messrs. Barbera, Sparks, and others. Mr. Kunze, however, used ELI’s curriculum, marks, pictures, and/or information to do so.

47. Mr. Kunze, through the American Laser College website (laserlaser.com), advertised his services by using ROCKY MOUNTAIN LASER COLLEGE’S name interchangeably with American Laser College, as if they were affiliated. He directed customers to contact him for laser education, but used ELI’s refund and other policies along with pictures of ELI’s facilities and students to do so. Mr. Kunze also represented Certified Laser Specialist was a trademark owned by him. The laserlaser.com website had no working link to ELI’s website. At that time, ELI was also relying on the laserlaser.com website to drive student traffic to its business.

48. On laserlaser.com, using “American Laser College” and the mark ROCKY MOUNTAIN LASER COLLEGE, along with pictures from ELI’s facility, Mr. Kunze advertised that he was providing laser training on April 28-30, 2011, in Bellevue, Washington.

49. On April 18, 2011, Mr. Kunze taught two students for $2,000.00, using ELI’s curriculum and marks, but later awarded them certificates through ELI’s competitor, Rock Creek Laser and Aesthetics Institute (“Rock Creek”). Mr. Kunze, however, did not use Rock Creek’s laser education curriculum and, at that time, had no business relationship with Rock Creek.

50. In about late April 2011, after saving the information for his own account, Mr. Kunze deleted about 60 gigabytes of data from ELI’s server, which included a list of ELI’s customers — its students and clients. Mr. Kunze did so in order to solicit business from ELI’s students and clients.

51. Also in about April 2011, ELI discovered that Mr. Kunze had not filed ELI’s tax return for the year-ended January 31, 2009. The tax return had been timely prepared, but Mr. Kunze never filed it or paid the taxes owed resulting in the Internal Revenue Service assessing interest and penalties on top of the taxes that were owed. ELI paid the amount owed to the I.R.S. for the 2009 taxes.

52. On April 28-30, 2011, Mr. Kunze taught the Washington class as advertised on the laserlaser.com website, again for his own account. Mr. Kunze taught five students and gave them receipts from American Laser College. However, Mr. Kunze used ELI’s ROCKY MOUNTAIN LASER COLLEGE/RMLC marks and course materials. Mr. Kunze used ROCKY MOUNTAIN LASER COLLEGE and American Laser College interchangeably during the course such that students thought they were the same or affiliated. Mr. Kunze represented to the students they would receive Certified Laser Specialists certificates, but they did not. The students were surprised or confused when they received Certified Laser Technician (“CLT”) certificates from an entity they had never heard of — Rock Creek. Regardless, those students sought certification for using a laser and it really did not matter much, if at all, whether it was a CLT or a CLS. Unbeknownst to the students, at the time the course was given, Mr. Kunze had no business relationship with Rock Creek and did not use its approved curriculum.

53. How these five students came about to be taught by Mr. Kunze apparently differed. Diane Oakley took the class after she heard from Debbie Caddell, a former ELI student, that Mr. Kunze was coming to teach in Washington. Bradley Jellerichs, another student, was a new employee of. Ms. Caddell, an employer who wanted all her employees to take the course from Mr. Kunze.

54. The relative sophistication of these students apparently varied. Mr. Jellerieh checked whether the certification he would be receiving from Mr. Kunze’s course was in fact required, and concluded it was not. Others, however, apparently blindly believed that it was required.

55. “Rock Creek” is Rock Creek Laser and Esthetics Institute and Rock Creek Medi Spa, a company with a spa and a small laser school which offered a Certified Laser Technician (CLT) certificate upon completion. Rock Creek’s educational curriculum is approved by the DPOS. The Washington students received Rock Creek certificates because ELI would not issue ROCKY MOUNTAIN LASER COLLEGE certificates for the course taught.

56. ELI would not issue ROCKY MOUNTAIN LASER COLLEGE certificates because Mr. Kunze’s offsite students were only to receive certificates of completion. In addition, by the time Mr. Kunze requested ELI to issue the certificates, the parties’ relationship had terminated.

57. Specifically, on May 2, 2011, ELI terminated the Amendment for cause after discovering Mr. Kunze was not linking the laserlaser.com website to ELI’s website and had downloaded student and client information from ELI’s server. In addition, on the laserlaser.com website, Mr. Kunze was representing that he owned the trademark Certified Laser Specialist.

58. ELI asked Mr. Kunze to leave ELI’s premises and to cease using its marks. Mr. Kunze believed ELI had terminated the parties’ agreements, and the Court so finds.

59. Also on that date, Mr. Kunze taught a student for $1,000.00 and subsequently awarded him a certificate from Rock Creek. Again, this was before Mr. Kunze had any relationship with Rock Creek. As Mr. Kunze had neither his own curriculum nor Rock Creek’s to use, the Court finds that he must have used ELI’s.

60. On the following day, May 3, 2011, Mr. Kunze, through ANMM, offered ELI a check for $1,575.00 as its 10% commission for the class taught in Washington in exchange for Certified Laser Specialist certificates. ELI did not cash the check as the Amendment provided that only certificates of completion would be given. The Washington students paid $3,150.00 each, for a total of $15,750.00 in tuition for the course.

61. About this time, ELI allowed Mr. Kunze to take two THERMO-Los with the understanding that he would replace them. Despite demand, Mr. Kunze has never done so. The THERMO-Los had a value of $875.00 each.

62. ELI also allowed Mr. Kunze to take two MediDerms, each valued at $15,000.00, which he ultimately returned but in an inoperable condition with no value. The value of all equipment taken was $31,750.00 ($1,750.00 [$875.00 x 2 = THERMO-Los] + $30,000.00 [$15,000.00 x 2 = MediDerms] ).

63. After Mr. Kunze was removed from the premises, ELI discovered that Mr. Kunze had been selling THERMO-Los to ELI’s students, even after he sold ELI to the Fluken-Riggs. Those sales totaled $174,295.00. (Ex. 85.) Of those sales, three were to students who took classes in April 2011, on or after the April 4, 2011 Amendment which allowed Mr. Kunze to make such sales without restrictions. Those sales totaled $10,500.00; therefore, sales between December 2009 and April 3, 2011 totaled $163,795.00 ($174,295.00— $10,500.00).

64. With the termination of the parties’ agreements, any prohibition against equipment sales also terminated. The non-compete (non-solicitation of prospective, current, and former clients for laser education and services), confidentiality, and indemnification provisions, however, survived. Thus, Mr. Kunze was still bound by the two-year non-compete, which applied until May 2013. Mr. Kunze, however, competed.

65. On laserlaser.com and other websites (such as no-hair.eom and no-tattoo.com), Mr. Kunze made numerous false and misleading advertisements to the public. For example, Mr. Kunze represented one site was sponsored by ROCKY MOUNTAIN LASER COLLEGE or RMLC, when it was not; that CLS or Certified Laser Specialist was trademarked in 1997, when it was not; that there are 4,500 CLS specialists worldwide, when there was and is not; and that ROCKY MOUNTAIN LASER COLLEGE is associated with ALC and International Laser College, when it was and is not. Mr. Kunze, without authorization, used ELI’s pictures and video, address, marks, policy, and curriculum. Mr. Kunze even displayed pictures of celebrities Mike Tyson or Beyoncé on two of these sites.

66. On May 7, 2011, Mr. Kunze approached Rock Creek about a potential buyer for its laser school, but no sale ever materialized. Instead, on or about May 17, 2011, ANMM and Rock Creek agreed that Mr. Kunze would train students under the auspices of Rock Creek and its curriculum, and certified laser technician certificates would be issued to students in exchange for 5% of the tuition fees. Mr. Kunze, however, asked Rock Creek to change its certificates to “Certified Laser Specialists” or to include “CLS.”

67. In connection with his association with Rock Creek, Mr. Kunze used the laserlaser.com website to drive business to him. His false advertisements to consumers included misrepresenting that CLS was trademarked; using testimonials of ELI’s students for that of Rock Creek or “The Laser College”; and using pictures and curriculum from ELI.

68. Between May 2, 2011 and August 19, 2011, Mr. Kunze trained 12 students, 11 of whom who paid a total of $37,500.00. Mr. Kunze used Rock Creek’s license to issue these students certificates, but three of the students were trained before May 17, 2011, when Mr. Kunze had no agreement with Rock Creek. Moreover, Mr. Kunze issued certificates under Rock Creek’s name but used, at least in part, ELI’s curriculum and marks.

69. Mr. Kunze, Jr. continued to work for ELI after Mr. Kunze’s removal,'but not for long. On or about May 26, 2011, ELI terminated Mr. Kunze, Jr. after discovering that he was “rebranding” ELI’s ROCKY MOUNTAIN LASER COLLEGE course materials as American Laser College materials for use by Mr. Kunze in teaching classes in competition with ELI. Mr. Kunze, Jr. had apparently done so for the Washington class.

70. On June 24, 2011, Mr. Kunze— again — sought to register Certified Laser Specialist as a trademark on the Principal Register, representing that he owned the mark, and that the mark had been used in commerce as early as July 1996.

71. On July 21, 2011, ELI filed suit. Mr. Kunze continued to compete.

72. Mr. Kunze continued to offer laser education courses, and to use ELI’s pictures on the laserlaser.com website. One of Mr. Kunze’s Linkedln profiles stated he is the owner of Rocky Mountain Laser College.

E. Mr. Kunze disparages ELI and Mr. Fluken

73. After the parties’ relationship terminated, Mr. Kunze not only competed against ELI but also made disparaging remarks about ELI and Mr. Fluken in order to do so.

74. On May 6, 2011, Mr. Kunze wrote to a Cynosure representative disparaging Mr. Fluken and his operation of ROCKY MOUNTAIN LASER COLLEGE, along with the services they provided. At that time ELI had Cynosure equipment on loan.

75. In February 2012, Mr. Kunze spread rumors that ELI was shutting down, so that he could reacquire the business. Mr. Kunze spread these rumors to ABC Bank and to ELI’s landlord, and advised them that he — Mr. Kunze — could make a go of the business. Mr. Fluken had to convince the bank and landlord otherwise.

F. The “Current” State of Affairs

76. On November 4, 2014, ELI registered Certified Laser Specialist as a service mark on the U.S. Patent and Trademark Office’s Supplemental Register. (Ex. 175) ELI’s application to register the mark on the Principal Register was declined. (Ex. G.)

77. At the time of trial, Mr. Kunze owned two websites laserlaser.com and no-hair.com, but only the former was active.

78. Plaintiffs have made no payments on the Promissory Note.

G. Other Misrepresentations

, 79. Before and after the sale of ELI to thé' Fluken-Riggs, Mr. Kunze made numerous false and/or misleading advertisements in order to influence consumers to purchase his goods (e.g., lasers) and services. For example, in his advertising, Mr. Kunze said he is an M.E., implying he has a medical background when he does not; implied he has a degree in electrical engineering from Red Rocks Community College when he does not; stated he had “professional experience” with the American Heart Association when all he did was take a CPR course; said he was associated with numerous laser associations, including international associations, when he was not; implied he had written for a number of “laser publications” when he supposedly was only “quoted” “in quite a few of them”; -and represented that 2,500 or 4,500 Certified Laser Specialist certificates were awarded, which were not. In addition, he advertised that he held a number of patents, including “laracaine” (purportedly a skin desensitizer), laser googles, a thermo-paper template, and THERMO-Lo, when he did not. Mr. Kunze’s misrepresentations know no bounds.

H.The Experts and ELI’s Financials

80. ELI’s class revenues were as follows: $455,548 (FYE January 31, 2009); $301,973 (FYE January 31, 2010); $415,665 (FYE January 31, 2011); $276,337 (FYE January 31, 2012); $462,045 (FYE January 31, 2013); and $411,498 (FYE January 31, 2014). (Ex. 144)

81. Paul Cadorette, Plaintiffs’ expert (“Plaintiffs’ Expert”), issued two opinions concerning ELI’s losses. The first opinion was issued on August 8, 2012, opining ELI suffered damages in the amount of $779,073.00. (Ex. 155.) The second opinion was issued on November 19, 2014, opining ELI suffered damages in the amount of $493,832.00 (for fiscal years ending January 31, 2011 through January 31, 2017). (Ex. 144.) The difference in the amounts resulted primarily from the fact that, in the latter report, Plaintiffs’ Expert had additional actual data from which to project damages. Plaintiffs rely on the second report on which to base ELI’s claim for damages.

82.Plaintiffs’ Expert’s methodologies, and resulting calculations, are unreliable and/or speculative in a number of respects, as addressed below:

(a) The difference between Plaintiffs’ Expert’s initial projected loss and revised projected loss (based on additional actual figures) is $285,241.00 (37% of his original calculation), showing there are significant flaws in his assumptions;

(b) His calculations were based on an assumed sustained growth rate of 5% per year, using January 31, 2011 as the base year, but that is unsupported by reliable data or other information.

(i) First, the assumption was based on Mr. Kunze’s indication to ABC Bank that it was a great time to buy ELI, but Mr. Kunze never used a 5% figure; and

(ii) Next, the assumption relied on Exhibit E, the valuation performed for ABC Bank in anticipation of making the loan to the Fluken-Riggs, which Plaintiffs’ Expert testified had much greater classroom revenues projected than the 5% he used. The valuation did have a greater than 5% projected increase, but in clinic, not class, income. Instead, there • was a five percent (5%) class revenue increase forecasted for 2010 ($458,682 actual for 2009 and $480,000 forecasted for 2010); a 10% increase forecasted for 2011; and. no increase forecasted for 2012.

(c)Mr. Kunze ceased providing any assistance to ELI post-May 2, 2011, but ELI’s class revenues nonetheless increased more than Plaintiffs’ Expert projected.

83. Plaintiffs’ Expert’s calculations were based on the ICA running five years, with a two-year non-compete thereafter. Damages were therefore calculated for a total of seven years (fiscal year ended January 31, 2011 through January 31, 2017), with no class revenue loss for FYE 2013. The ICA, as amended, however, was terminated by May 2011 and the two-year non-compete ran by May 2013. Thus, for example, Mr. Kunze would be entitled to compete on or about May 2, 2013, just not improperly by, for example, stating he is affiliated with Rocky Mountain Laser College.

84. Plaintiffs’ Expert’s methodology for determining, and its determination of, certain losses or earnings are reasonable and reliable:

(a) The determination of ELI’s average earnings per student of $2,640.00 (Ex. 154,156);

(b) The determination of the estimated costs of equipment at 71% of the sales price. (Ex. 144, Schedule 7; Ex. 151.); and

(c) The determination of average costs per class at 28.6% of revenues (Ex. 144, Schedule 8).

85. Plaintiffs’ Expert’s methodology for determining lost equipment sales for year-ended January 31, 2011 is reasonable and reliable. The figure calculated for lost equipment sales for year-ended January 31, 2011, however, is not; therefore, all calculations based on such numbers are also incorrect.

(a) The number and amount of sales to ' students, post-sale of ELI, is based on Exhibit 85 and Plaintiffs’ Expert’s review of the supporting invoices. That figure is $174,295.00. Exhibit 85, however, shows that five of those sales (totaling $19,750.00) are post-January 31, 2011. Thus, sales FYE January 31, 2011, were actually $154,545.00 ($174,295.00-$19,750.00).

(b) ELI’s net lost profit in commission sales FYE January 31, 2011 is $81,222.00 ($154,545.00— $73,323.00).

(c) As stated, there were five sales totaling $19,750.00 post-January 31, 2011. Of those five sales, two sales were made between January 31, 2011 and April 3, 2011, totaling $9,250.00. The other three sales were made post-April 4, 2011, totaling $10,500.00.

(d) Plaintiffs’ Expert assumed lost equipment sales after January 31, 2011, but, by the Amendment entered into April 4, 2011, Mr. Kunze was allowed to make such equipment sales in competition with ELI. However, Mr. Kunze was not allowed to use ELI’s customer list to do so. Nonetheless, except for the five post-January 31, 2011 sales made to students of ELI in February and April 2011, there is insufficient evidence that Mr. Kunze thereafter made sales using ELI’s customer list, to sustain a finding of damages on that basis. Therefore, no loss has been shown for the subsequent years.

86. Plaintiffs’ Expert assumed that all projected losses were caused by Mr. Kunze’s actions, and recoverable on all claims. His methodology did not consider other factors in projecting future losses, such as ELI’s increase in pricing. Moreover, his methodology should have — but failed to — distinguish between losses recoverable on the different claims. For example, ELI seeks to recover lost laser sales from Mr. Kunze’s use for ELI’s customer list — a claim that clearly would not support all the general lost profits projected.

87. Mr. Kunze’s expert, Lisa Meer (“Defendants’ Expert”), critiqued Plaintiffs’ Expert and opined on Mr. Kunze’s damages arising from the non-payment of the Promissory Note. Defendants’ Expert offered criticisms, but could not say ELI suffered no damages. Her opinions too suffered from some of the flaws she assigned to Plaintiffs’ Expert, e.g., the erroneous reliance on an assumption not supported by the evidence.

88. Defendants’ Expert’s opinion regarding Mr. Kunze’s damages is based on the assumption that the entire amount ($250,-000.00) was due under the Promissory Note. This opinion is based on facts contrary to those found by the Court; therefore, they will not be considered.

II. CONCLUSIONS OF LAW

To the extent that any findings of fact are deemed to be conclusions of law, they are incorporated herein by reference as conclusions of law.

A. Subject Matter Jurisdiction

This Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1381 and 1338 and 15 U.S.C. § 1121 over ELI’s Lanham Act claims, and pursuant to 28 U.S.C. § 1367 over the remaining claims, counterclaims, third-party claims, and third-party counterclaims.

B. Three Agreements, Not One

The PSA, ICA, and Promissory Note are not one contract but, rather, three related contracts that should be read together. The PSA provides that $250,000.00 of the purchase price is to be paid by “means” of a promissory note “in the form and in accordance with the terms reflected in Exhibit A ... incorporated herein by reference.” Similarly, the PSA requires the Fluken-Riggs to “cause” ELI to sign the ICA “in the form attached hereto and incorporated herein by this reference.” These provisions, and the agreements as a whole, do not support the finding that these three documents constitute one contract, or that all parties were parties to all three agreements.

C. The “Contractual Claims”

1. Termination is Not Plaintiffs’ Sole Remedy

Contrary to Mr. Kunze’s contention, Plaintiffs’ remedy in this case is not limited to termination of the PSA. Section 9 of the PSA provides that “time is of the essence,” and if Mr. Kunze defaults or refuses to perform “within the time required” in the PSA, the Fluken-Riggs may terminate the PSA and have their monies paid returned. “All other remedies” are expressly waived. When the paragraph (and the agreement) is read as a whole, this limitation relates to Mr. Kunze’s performance in closing on the stock purchase contemplated under the PSA, such as executing a “Stock Power.” This limitation is inapplicable to the performance under the ICA or Amendment. Moreover, this agreement is between the Fluken-Riggs and Mr. Kunze; ELI is not a party. Accordingly, Section 9 does not bar the remedies Plaintiffs seek.

2. Fraud in the Inducement of the PSA — the Fluken-Riggs’ Second Third-Party Counterclaim Against Mr. Kunze

The Fluken-Riggs allege they were fraudulently induced into entering into the PSA and, accordingly, seek damages and the cancellation of the Promissory Note as to all promisors — including ELI. The Court finds the Fluken-Riggs failed to establish this claim.

In order to establish fraudulent representation, the Fluken-Riggs must establish: (1) Mr. Kunze made a false representation of a past or present fact; (2) the fact was material; (3) at the time the representation was made, Mr. Kunze knew the representation was false or was aware that he did not know whether the representation was true or false; (4) Mr. Kunze made the representation with the intent that the Fluken-Riggs would rely on the representation; (5) the Fluken-Riggs relied on the representation; (6) the Fluken-Riggs’ reliance was justified; and (7) the reliance caused the Fluken-Riggs damages. C.J.I.-Civ. 4th 19:1 (2015); see Student Marketing Group, Inc. v. College P’ship, Inc., 247 Fed.Appx. 90, 100 (10th Cir.2007) (unpublished) (discussing fraudulent concealment). The Fluken-Riggs have raised a number of representations as fraudulent. The Court has grouped them into five categories and will address them accordingly.

First, the Court finds Mr. Kunze knowingly made false representations concerning his educational and professional background, the number of CLS certificates that had been awarded, the necessity of having a CLS certificate, and other matters related to the CLS certifications with the intent that the Fluken-Riggs rely on such representations. Nonetheless, even assuming they were material to the Fluken-Riggs’ decision to enter into the PSA and reliance was justifiable, the Fluken-Riggs have shown no damages. Here, the damages sought arise from Mr. Kunze’s failure to perform in accordance with the terms of the ICA and Amendment, and other misconduct.

Next, as for any financial information provided by or on behalf of Mr. Kunze, such as the collectability of the Body Laser Solution receivable and the value of ELI’s equipment and inventory, the Court finds there was no reliance on the part of the Fluken-Riggs as to such information. Instead, the Fluken-Riggs were skeptical and distrusted financial information that was received, so Mr. Fluken, on behalf of the Fluken-Riggs, conducted his own due diligence and independent investigation into ELI’s financials reports/statements.

Third, the Court finds Mr. Kunze knowingly falsely represented to the Fluken-Riggs that Certified Laser Specialist and CLS were registered trademarks, only available for issuance from and for use by ELI. Such facts were material and upon which the Fluken-Riggs justifiably relied. The question is whether the Fluken-Riggs have been damaged by this misrepresentation, as they have presented insufficient evidence on this issue. While there is evidence that ELI has suffered damages, as evidenced by Mr. Kunze’s attempt — after the sale of ELI to the Fluken-Riggs — to register the marks for himself, and by ELI’s diminished ability to protect its interest in the marks in this very lawsuit against Mr. Kunze, such injury does not support a claim for damages as to the Fluken-Riggs. See Nicholson v. Ash, 800 P.2d 1352, 1356 (Colo.App.1990) (shareholder without standing to complain for injury to corporation, as any injury to them was indirect)

Fourth, the Court finds Mr. Kunze knowingly concealed that he did not file ELI’s tax returns or pay ELI’s tax liabilities for the tax year ended January 31, 2009. The Fluken-Riggs could not have discovered the information with reasonable diligence in light of the fact the tax return was prepared, but Mr. Kunze failed to file. Nonetheless, the Court finds the information was not material to the Fluken-Riggs, e.g., that they would have requested a reduction of the purchase price in light of the tax liability. To the extent the Fluken-Riggs contend they would have escrowed the amount owed until paid, they ignore the liability was that of ELI, not Mr. Kunze. Moreover, it was ELI that paid for not only the taxes owed but also the associated interest and penalties. And, regardless of when the taxes were paid, the tax itself would have been owed by ELI. Thus, even assuming, arguendo, the information was material to their decision to purchase ELI, the Fluken-Riggs failed to show they have been damaged. See Nicholson v. Ash, supra.

Finally, as for ELI’s course curricula and student/customer list, the evidence presented was insufficient for the Court to find Mr. Kunze made fraudulent representations concerning their confidentiality or otherwise upon which the Fluken-Riggs justifiably relied.

In summary, while the evidence shows Mr. Kunze made fraudulent representations to the Fluken-Riggs as to some of the matters claimed, the Fluken-Riggs have not shown they reasonably relied and/or were damaged by such representations.

The Fluken-Riggs also seek cancellation of the Promissory Note as to all Plaintiffs as a remedy for Mr. Kunze’s actions, but the Court finds a lack of factual evidence and legal authority to support such relief. First, as stated, the Fluken-Riggs have failed to establish their claim; therefore, they are entitled to no damages. Further, generally, a party who has been fraudulently induced into entering into an agreement may either sue to rescind the contract, or affirm the contract and sue in tort. W. Cities Broad. Inc. v. Schueller, 849 P.2d 44, 48 (Colo.1993); Robinson v. Colo. State Lottery Div., 179 P.3d 998, 1004 (Colo.2008). A party cannot do both. Joyce v. Davis, 539 F.2d 1262, 1266 (10th Cir.1976) (citing Kelley v. Silver State Sav. & Loan Ass’n, 534 P.2d 326 (Colo.App.1975). Here, the Fluken-Riggs did not seek to rescind the contract but, instead, sued in tort; therefore, rescission of the Promissory Note is not permitted, even assuming they otherwise established their claim. Accordingly, the Court finds in favor of Mr. Kunze on this claim. In light of the Court’s determination, it need not decide whether the claim would otherwise be barred by the economic loss rule or the integration clause.

3. Breach of the PSA — The Fluken-Riggs’ First Third-Party Counterclaim Against Mr. Kunze

The Fluken-Riggs contend that Mr. Kunze breached the PSA in three respects: (1) failing to treat the customer/student information as trade secrets and proprietary information and using that information for his own benefit, in violation of paragraph 4; (2) advertising and otherwise disclosing the sale of ELI to third-parties, in violation of paragraph 13; and (3) failing to convey to ELI the Websites. Upon consideration of the evidence, the Court finds there has been a breach of the PSA (though not to the extent claimed), but no damages have been shown or the relief sought may not be awarded.

First, paragraph 4 provides that information shared by ELI with the Fluken-Riggs “shall be deemed [ELI’s] confidential trade secrets and proprietary information,” such information shall be returned if the sale of ELI’s stock is not completed, and if the Fluken-Riggs breach or threaten to breach paragraph 4, ELI and Mr. Kunze would be entitled to injunctive and other relief against the Fluken-Riggs. Read as a whole, in order to protect ELI and Mr. Kunze, this paragraph obligates the Fluken-Riggs to keep information disclosed in connection with the stock purchase confidential and affords ELI and Mr. Kunze a remedy in the event of a breach by the Fluken-Riggs. This paragraph does not obligate Mr. Kunze to keep such information confidential in favor of the Fluken-Riggs. As such, Mr. Kunze did not breach paragraph 4.

Next, paragraph 13 of the PSA precludes Mr. Kunze from issuing “any statement, announcement or press release regarding this Agreement.. .or otherwise disclose the existence or contents of this Agreement,” with exceptions not applicable here. Mr. Kunze, however, repeatedly breached this provision by informing third-parties of the PSA. As the remedy for Mr. Kunze’s breach, the Fluken-Riggs seek rescission of the Promissory Note — not the PSA on which the Promissory Note- is based. The Fluken-Riggs have presented no persuasive legal authority or evidence to support that they may keep the company, but cancel the Promissory Note in its entirety. The Court finds they may not.

Finally, as to the transfer of the disputed Websites, ELI may have paid to have them maintained prior to sale, but they were owned by Mr. Kunze. Further, the PSA is a stock purchase agreement and contains no requirement that Mr. Kunze transfer “title” to or ownership of such Websites to ELI, or anyone else. No agreement was ever reached to transfer the Websites to ELI or the Fluken-Riggs. Therefore, the failure to transfer is not a breach of the PSA, and transfer will not be ordered.

Based on the foregoing, the Court finds in favor of Mr. Kunze on the Fluken-Riggs’ First Third-Party Counterclaim for breach of the PSA.

4. Economic Duress as Basis to Void the Amendment—ELI’s Fourth Claim against Mr. Kunze

ELI seeks to void the Amendment on the basis of economic duress. “A contract is voidable on the grounds of duress if a party’s manifestation of assent is induced by an improper threat that leaves no reasonable alternative.” Vail/Arrowhead v. Eagle County Dist. Ct., 954 P.2d 608, 612 (Colo.1998); Bennett v. Coors Brewing Co., 189 F.3d 1221, 1231 (10th Cir.1999). However, “[a]n improper threat does not constitute economic duress if the victim fails to pursue a reasonable alternative but instead yields to the threat.” Vail/Arrowhead, 954 P.2d at 613 (citing Restatement (Second) of Contracts § 175 cmt. b (1981)). Moreover, the exertion of pressure through threats is not sufficient, “it must also clearly appear that the force or threats employed actually subjugated the mind and will of the person against whom they were directed, and were thus the sole and efficient cause of the action which he took.” Premier Farm Credit, PCA v. W-Cattle, LLC, 155 P.3d 504, 521 (Colo.App.2006) (quotation marks and citation omitted); Bennett, 189 F.3d at 1231.

Here, the Court finds the evidence does not support ELI’s claim for economic duress. First, the Court is not persuaded by the testimony that ELI felt it had no choice when Mr. Kunze threatened to quit. Next, Mr. Kunze’s threat occurred over a period of time, allowing ELI an opportunity to reflect on its options and to consult with an attorney, if it had wished to do so. Finally, the parties negotiated new terms which were not one sided as the Amendment modified all parties’ rights and obligations, and benefitted the Fluken-Riggs individually as well through the modification of the Promissory Note. Based on the evidence, the Court finds no duress and, accordingly, the Amendment may not be voided. The Court finds in favor of Mr. Kunze on this claim.

5. Breach of the ICA and Amendment—ELI’s Fifth Claim Against Mr. Kunze

The first issue for resolution is whether the Amendment was an accord and satisfaction of the ICA. The Court finds it is not.

An accord and satisfaction requires the following: after the defendant and plaintiff had entered into a contract (here, the ICA), they entered into a later contract (here, the Amendment); the plaintiff and defendant knew or reasonably should have known that the later contract cancelled or changed their remaining rights and duties under the earlier contract; and the defendant has fully performed the duties he agreed to perform under the later contract. CJI-Civ. 30:28 (2015). In order to be effective, the relevant facts must be known to both parties. Metropolitan State Bank v. Cox, 134 Colo. 260, 302 P.2d 188, 193 (1956).

Here, neither the Amendment nor the evidence presented shows an accord and satisfaction. The Amendment was entered into to address Mr. Kunze’s desire to engage in other activities and to modify the parties’ rights and obligations going forward, but only as to certain terms. It was neither offered as full satisfaction of Mr. Kunze’s obligations under the ICA, nor an agreement which contemplated or accounted for the damages arising from Mr. Kunze’s breaches of duties under the ICA. For example, at the time the parties entered into the Amendment, ELI was not aware that Mr. Kunze had taught the Texas class or made equipment sales to ELI’s students/customers. Accordingly, ELI is not precluded from seeking relief for breach of the ICA and Amendment.

Five breaches are claimed, and the Court so finds. First, Mr. Kunze’s equipment sales for his own account in competition with ELI breached the ICA. Under the ICA, Mr. Kunze’s duties included acting as a liaison and consultant for ELI with the laser manufacturers. The scope of such duties are not specifically identified, but is broad enough to include facilitating equipment sales for the benefit of ELI, duties which Mr. Kunze had performed on behalf of ELI prior to its sale to the Fluken-Riggs. Moreover, the ICA required ELI’s approval for Mr. Kunze to engage in activity which would conflict with the operations of ELI, operations which included the sale of laser equipment. Finally, the parties’ conduct show that was their intent, as demonstrated by the parties’ inclusion of a provision in the Amendment to allow Mr. Kunze to work with laser manufacturers and resellers without restrictions. Accordingly, Mr. Kunze’s sale of equipment prior to April 4, 2011, breached the ICA. ELI was damaged by what it would have earned on such sales, i.e., $84,102.00.

Next, Mr. Kunze taught a Houston, Texas class in January 2011 for his own account, without the knowledge of ELI, in breach of the ICA. Mr. Kunze was required to conduct four (4) classroom sessions outside the Denver facility each year, but on behalf of ELI. Thus, ELI was damaged in the amount of $2,456.00 ($4,000.00 in tuition - $400.00 [10% commission Mr. Kunze would have earned] - $1,144.00 [$4,000.00 x 0.286 (cost of class) ]).

Third, Mr. Kunze used ROCKY MOUNTAIN LASER COLLEGE on las-erlaser.com without linking to ELI’s website, in breach of the Amendment. The Court finds that ELI was damaged by Mr. Kunze’s breach, but the difficulty lies in determining the amount of damages. Plaintiffs’ damages expert provided a “global” calculation of damages, without differentiating—or even attempting to differentiate or to otherwise account for—losses which were caused by Mr. Kunze’s various misconduct. The evidence, however, provides some basis for determining what business was lost to Mr. Kunze due to his failure to comply with the Amendment. Here, after the Amendment was entered into, but before it was terminated, Mr. Kunze taught several classes, for which $17,750.00 in gross sales were generated. This consists of the $2,000.00 in tuition for the April 18, 2011 class and $15,750.00 tuition for the April 28, 2011 Washington class. These classes were driven by the commercial internet advertisements using ELI’s RMLC mark and pictures, and taught using ELI’s curriculum, without linking to ELI’s website. Under the Amendment, ELI is enti-tied to a 10% commission of tuition received from students from off-site classes. According, ELI is awarded damages in the amount of $1,775.00.

Fourth, Mr. Kunze advertised classes for which a CLS designation would be awarded, in violation of the Amendment. There is some evidence that some students took the course to receive the CLS designation (either because they believed so or because they were so advised). Seven students (two on April 18 and five in Washington on April 28-20, 2011) took the class from Mr. Kunze after the Amendment was entered into but before it was terminated, with tuition totaling $17,750.00. ELI is entitled to an award of $1,775.00, representing the 10% commission it would have earned from off-site classes. Any duplication in damages will be addressed in the Court’s total award of damages.

Finally, ELI claims Mr. Kunze breached the post-termination non-compete provision. The Court agrees, but finds any breach would have occurred after the parties’ relationship terminated on May 2, 2011. The damages shown, however, are limited. Here, ELI presented evidence that between May 2, 2011 and August 19, 2011, Mr. Kunze taught twelve students using Rock Creek’s license, for a total of $37,500.00. In light of Mr. Kunze’s post-termination prohibition from “solicitfing], offering], or providing] laser hair removal education and training” within a 25-mile radius of ELI’s office, the Court finds damages in the amount of $37,500.00.

In summary, Mr. Kunze has breached the ICA and Amendment for which $127,-608.00 in damages have been shown.

6. Breach/Anticipatory Breach of the Promissory Note—Mr. Kunze’s Third Counterclaim/First Third-Party Claim against Plaintiffs; and Declaratory Relief on Promissory Note—Mr. Kunze’s Fifth Counterclaim/Second Third-Party Claim against Plaintiffs

Mr. Kunze is entitled to relief on his counterclaims/third-party claims for breach of the Promissory Note. The Promissory Note states it is “subordinate” to the note payable to the ABC Bank. When the note