February 17, 1993
                United States Court of Appeals
                    For the First Circuit
                                         

No. 92-1052

                  THE PH GROUP LTD., F/K/A,
                    COGNETICS EUROPE LTD,

                    Plaintiff, Appellant,

                              v.

                   DAVID L. BIRCH, ET AL.,

                    Defendants, Appellees.

                                         

No. 92-1053

                   THE PH GROUP LTD., F/K/A
                   COGNETICS EUROPE, LTD.,

                     Plaintiff, Appellee,

                              v.

                       DAVID L. BIRCH,

                     Defendant, Appellee,

                                     

                       COGNETICS, INC.

                    Defendant, Appellant.
                                         

        APPEALS FROM THE UNITED STATES DISTRICT COURT
              FOR THE DISTRICT OF MASSACHUSETTS

  [Hon. W. Arthur Garrity, Jr., Senior U.S. District Judge]
                                                          

                                         

                            Before

                     Breyer, Chief Judge,
                                        
                Brown,* Senior Circuit Judge,
                                            
                    Stahl, Circuit Judge.
                                        

                                         

Edwin A.  McCabe  with whom  Joseph  P.  Davis, III,  Karen  Chinn
                                                                  
Lyons, and The McCabe Group were on brief for appellants.
                       
Robert  J. Kaler  with  whom Gadsby  &amp;  Hannah  was  on brief  for
                                              
appellees.

                                         

                      February 17, 1993
                                         

                 

*Of the Fifth Circuit, sitting by designation.

          STAHL, Circuit Judge.   This case involves a failed
                              

attempt to license American-made computer software for use in

Europe.   On appeal,  plaintiff The  pH Group  Ltd., formerly

known   as  Cognetics  Europe  Ltd.  ("PH"),  challenges  the

district court's failure (1) to  award it attorneys' fees and

(2) to rule favorably  on its claims of unfair  and deceptive

trade  practices.   Defendants Cognetics,  Inc. ("Cognetics")

and  David  L.  Birch  cross-appeal, taking  issue  with  the

district court's  denial of their motion  for judgment n.o.v.

or  a  new  trial  on  their   counterclaims  for  breach  of

contract.1    Finding  no   error  in  the  district  court's

rulings, we affirm.

                              I.
                                

           FACTUAL BACKGROUND AND PRIOR PROCEEDINGS
                                                   

          David  Birch  developed  computer   software  which

analyzes Dun &amp; Bradstreet  data bases for business consulting

purposes.2  In order  to exploit this software in  the United

States, Birch  and his associates  formed Cognetics.   PH was

formed by Rolf Hickmann,  Norbert Reis, and other individuals

principally  to  develop  a  consulting  business  in  Europe

through  the use of the Cognetics software.  PH and Cognetics

                    

1.  Because  the  interests   of  Birch  and   Cognetics  are
inexorably   intertwined  for   purposes   of  this   appeal,
references  to Cognetics  should  be  construed  as  applying
equally to Birch. 

2.  Dun  &amp; Bradstreet  generates  computer data  bases  which
report the financial statistics of private businesses.  

                             -2-
                              2

negotiated a license agreement ("the Agreement"), under which

PH  received the right to use the Cognetics name and software

in Europe.   For its part,  Cognetics was to provide  PH with

both Dun &amp; Bradstreet's European data bases and the Cognetics

software  to   analyze  them.     The  parties   agreed  that

Massachusetts law would govern the Agreement's construction.

          The Agreement was signed in January of 1987, and PH

began doing business in Europe.  Shortly thereafter, the same

individuals who  had  formed PH  incorporated Maven  Systems,

Ltd. ("Maven").3  The  record reflects that Maven  was formed

to allow  the individual  owners of PH  to pursue  consulting

business in Europe without using the Cognetics software.  The

Agreement clearly  contemplates and  allows for  such outside

activity.4  

          Almost   immediately,   difficulties  between   the

parties  surfaced.    Essentially,  PH  claimed  that  Dun  &amp;

Bradstreet's European  data bases differed  from its American

data bases, and that Birch and Cognetics knew, or should have

                    

3.  Maven is not  a party  to this appeal.   Cognetics  named
Maven  as  a  defendant-in-counterclaim below,  but  does not
appeal the district  court's ruling that Maven is  not liable
on the counterclaims.  

4.  Section   2(e)   of   the   Agreement,   entitled  "Other
Businesses," states:

     [N]othing shall  preclude  [PH] from  conducting  a
     business unrelated to [Cognetics] Software, Related
     Software  or  Products .  .  .  provided that  such
     business is  not  conducted under  the  [Cognetics]
     Name or any variation thereof.

                             -3-
                              3

known, that as  a result  of these  differences the  European

data bases  could not be analyzed  effectively with Cognetics

software.   Cognetics, on the other hand, claimed that PH had

violated the  Agreement by  improperly allowing Maven  to use

the Cognetics name in Maven's  initial business dealings.  By

September  1987,   each  party  was  claiming   that  it  had

terminated the Agreement.

          On April 22, 1988,  PH sued Cognetics in diversity,

alleging  common law fraud,  breach of  contract, negligence,

breach of an implied covenant of good faith and fair dealing,

breach of  an implied  warranty of fitness  for a  particular

purpose, and violation of Mass. Gen. Laws Ann. ch.  93A,    2

and 11 (West  1984 and Supp.  1992) (hereinafter referred  to

collectively  as  "ch.  93A"),  which  proscribe  unfair  and

deceptive trade practices.  PH sought $10 million  in damages

on  these claims.  The complaint also asked for a declaratory

judgment that the Agreement's non-competition clause did  not

preclude  PH  from  pursuing  its  now  established  European

consulting business.5 

          Cognetics   counterclaimed,   alleging  breach   of

contract,   misappropriation   of   trade   secrets,   unfair

                    

5.  PH  also sought to recover  $30,000, a "fixed  fee" to be
paid  to Cognetics  for  certain services  due  PH under  the
Agreement.  PH had  placed this money into an  escrow account
when its relations with Cognetics began to sour, and it began
to question  whether Cognetics would provide  the "fixed fee"
services.  Cognetics never  contested PH's entitlement to the
$30,000, and the district court awarded the funds to PH.  

                             -4-
                              4

competition,  violation  of  the  Lanham Trade-Mark  Act,  15

U.S.C.A.   1125(a) (West Supp. 1992), violation of Mass. Gen.

Laws Ann. ch. 110B,   12 (West 1990), which forbids trademark

infringement, and violation of ch. 93A,   11.  Cognetics also

sought injunctive relief  to prevent further use  of its name

and proprietary materials.   

          The district  court bifurcated the trial  and tried

all liability issues first.  After directing verdicts against

several  of  the  parties'  substantive  claims,   the  court

submitted  the following claims to the jury:  (1) PH's claims

for fraud, breach of contract, and breach of implied covenant

of good faith and fair dealing; and (2) Cognetics' claims for

misappropriation of  trade secrets,  and breach  of contract.

The  claims and counterclaims under ch. 93A were tried to the

court along with the  requests for declaratory and injunctive

relief.

          The jury  found  against PH  on all  of its  claims

except for the claim of breach of an implied covenant of good

faith and fair dealing.   In the subsequent damages  phase of

the trial,  notwithstanding the  favorable verdict,  the jury

awarded  PH zero  damages  on this  claim.   The  jury  found

against Cognetics on all of its counterclaims.  The  district

court  found no  violations of  ch. 93A  by either  party and

denied all  requests for declaratory  and injunctive  relief.

Finally,  the  court denied  Cognetics'  motion for  judgment

                             -5-
                              5

n.o.v. or new  trial, and denied  PH's motion for  attorneys'

fees.

                             II.
                                

                          DISCUSSION
                                    

A.  PH's Appeal
               

     1.  PH's Claim for Attorneys' Fees
                                       

          PH argues  that it  is entitled to  attorneys' fees

under  section 21 of the Agreement6 because it "prevailed" on

its covenant  of good faith  and fair dealing claim.7   As an

initial matter, we note that the parties dispute whether this

issue was  properly preserved  for appeal.   Assuming without

deciding that  the issue was preserved,  we find unpersuasive

PH's contention that it was a "prevailing party" below. 

                    

6.  Section 21 of the Agreement states: 

     Attorneys' Fees.  In any litigation, arbitration or
                     
     court   proceeding   between   the   parties,   the
     prevailing party shall be  entitled to all costs of
     the   proceedings   incurred   in  enforcing   this
     Agreement.

7.  At oral argument, PH seemed to argue that the uncontested
award of  the $30,000  in  escrow entitled  it to  prevailing
party status.  This argument, however, appears nowhere in the
trial record, nor does it appear in PH's appellate brief.  It
is  settled in this circuit that issues adverted to on appeal
in a  perfunctory manner are  deemed to have  been abandoned.
United  States v. St. Cyr, 977 F.2d 698, 701 (1st Cir. 1992).
                         
As a result, we need not address this argument.  

                             -6-
                              6

          Courts, both in  Massachusetts and elsewhere,  have

uniformly  required that  a  party succeed  on a  significant

issue in order to be entitled to attorneys' fees.  See, e.g.,
                                                            

Handy v. Penal Insts. Comm'r of Boston, 592 N.E.2d 1303, 1307
                                      

(Mass.  1992)  (requiring that  party  in  civil rights  case

"succeed[]  on  a  significant   issue"  to  be  entitled  to

attorneys'  fees); Fedele  v. School  Comm. of  Westwood, 587
                                                        

N.E.2d  757, 761  (Mass. 1992)  (same).   See also  Farrar v.
                                                          

Hobby, 113 S.  Ct. 566,  569 (1992) (holding  that "[w]hen  a
     

[civil   rights]  plaintiff  recovers  only  nominal  damages

because of his failure  to prove an essential element  of his

claim for monetary relief,  the only reasonable  [attorneys']

fee  is usually  no fee at  all." (citation  omitted)); Texas
                                                             

State Teachers Ass'n  v. Garland Indep. Sch.  Dist., 489 U.S.
                                                   

782, 792 (1989) (holding  that civil rights plaintiff seeking

attorneys' fees "must be able to point to a resolution of the

dispute which  changes the legal  relationship between itself

and  the  defendant.    Beyond this  absolute  limitation,  a

technical victory  may be  so insignificant  . .  . as to  be

insufficient to support prevailing party status."); Guglietti
                                                             

v.  Secretary of Health and  Human Servs., 900  F.2d 397, 399
                                         

(1st  Cir.  1990) (requiring  either  "bottom-line litigatory

success"  or "catalytic  effect in  bringing about  a desired

result"  for  social security  plaintiff  to  be entitled  to

attorneys'  fees).   Moreover,  outside of  the civil  rights

                             -7-
                              7

context, an award  of zero damages,  supported by a  rational

basis in the  record, is generally considered a  judgment for

defendant.   See, e.g., Ruiz-Rodriguez  v. Colberg-Comas, 882
                                                        

F.2d  15,  17 (1st  Cir. 1989)  (stating  that award  of zero

damages is  "commonly viewed  as, in  effect, a  judgment for

defendant"); Poulin  Corp. v. Chrysler  Corp., 861 F.2d  5, 7
                                             

(1st Cir. 1988)  (holding that, upon  award of zero  damages,

"plaintiff has failed to establish  an essential part of  its

proof,   and   judgment   should   have   been  entered   for

defendant.").   Cf. Farrar, 113 S. Ct. at 573-74 ("Of itself,
                          

`the moral  satisfaction [that]  results  from any  favorable

statement of law' cannot bestow  prevailing party status. . .

.   No material alteration of the  legal relationship between

the parties  occurs until  the plaintiff becomes  entitled to

enforce a judgment, consent  decree or settlement against the

defendant.")  (quoting Hewitt  v.  Helms, 482  U.S. 755,  762
                                        

(1986).   The thrust  of this authority  renders unpersuasive

PH's argument that the  district court erred in finding  that

it  was  not a  "prevailing party"  under  section 21  of the

Agreement.

          Moreover, PH has not  proffered any evidence of the

parties' intent in drafting section 21 of the Agreement.  Nor

has it argued, let  alone demonstrated, that any construction

other than the ordinary  construction of the term "prevailing

party"  should apply.  Accordingly,  we find no  error in the

                             -8-
                              8

district court's holding that PH was not a "prevailing party"

for purposes of section 21 of the Agreement.

     2.  PH's ch. 93A Claim 
                           

          PH also  argues that  the  district court's  ruling

that Cognetics did not  violate ch. 93A is inconsistent  as a

matter of law with the jury's verdict that Cognetics breached

the  Agreement's  implied covenant  of  good  faith and  fair

dealing.   Massachusetts  courts have  held, however,  that a

trial  court's ruling on  a ch. 93A  claim may  differ from a

jury's  verdict  on  common  law claims  involving  the  same

evidence.   Chamberlayne Sch. v. Banker, 568 N.E.2d 642, 648-
                                       

49 (Mass. App. Ct. 1991) ("Although consistency . . . ha[s] a

surface appeal, we think the broader scope and more  flexible

guidelines of ch. 93A permit  a judge to make his or  her own

decisions under  [ch.] 93A  without being constrained  by the

jury's findings.").   See also Turner  v. Johnson &amp;  Johnson,
                                                            

809  F.2d 90, 102  (1st Cir.  1987) (interpreting  Mass. law)

(holding that jury's determination  is not binding on court's

ch.  93A decision);  Wallace  Motor Sales,  Inc. v.  American
                                                             

Motor Sales  Corp., 780  F.2d 1049, 1063-67  (1st Cir.  1985)
                  

(interpreting Mass.  law) (finding no reversible  error where

district  court  denied  judgment  n.o.v.   on  jury  counts,

reviewed  same evidence, and  reached conclusion  contrary to

jury's  verdict on the ch. 93A  claim).  Moreover, violations

of ch. 93A  must meet a higher standard of  liability than do

                             -9-
                              9

breaches  of  an  implied covenant  of  good  faith and  fair

dealing.     Compare  Anthony's   Pier  Four,  Inc.   v.  HBC
                                                             

Associates,  583  N.E.2d  806,  820-22  (Mass.  1991) ("[t]he
          

implied covenant of good faith and fair dealing provides that

neither  party shall do anything that will have the effect of

destroying or  injuring  the  right  of the  other  party  to

receive the fruits of the contract . . . .'") (quoting Druker
                                                             

v. Roland  Wm.  Jutras Assocs.,  Inc.,  348 N.E.2d  763,  765
                                     

(Mass.  1976)) with Tagliente v.  Himmer, 949 F.2d  1, 7 (1st
                                        

Cir. 1991) (stating that under ch. 93A, "`[t]he objectionable

conduct  must attain a level of rascality that would raise an

eyebrow  of someone  inured to  the rough  and tumble  of the

world of commerce.'" (quoting Quaker State Oil Refining Corp.
                                                             

v.  Garrity  Oil Co.,  Inc., 884  F.2d  1510, 1513  (1st Cir.
                           

1989)).  As such,  PH's claim that the verdicts  were legally

inconsistent is without merit.8

B.  Cognetics' Cross-Appeal
                           

          Cognetics  appeals the  district court's  denial of

its motion for judgment  n.o.v. or new trial on its breach of

contract  claim.  We must sustain the district court's denial

                    

8.  Although it is not  clear from its briefs, PH  appears to
argue  that the district court (a) failed to make findings of
fact sufficient  to support  its  ch. 93A  ruling and/or  (b)
inappropriately relied upon the jury's finding that Cognetics
committed no fraud.  Having carefully reviewed the record, we
find  that the  district court's  factual findings  were both
comprehensive and  independent of  the jury's  fraud verdict.
Thus,  PH's   contentions  to  the   contrary  are   entirely
meritless.

                             -10-
                              10

of a motion for judgment n.o.v. unless the evidence, together

with all reasonable inferences in favor of the verdict, could

lead a reasonable person to only one conclusion, namely, that

the  moving  party was  entitled  to judgment.    Luson Int'l
                                                             

Distribs.,  Inc. v.  Fabricating and  Prod. Mach.,  Inc., 966
                                                        

F.2d 9, 10-11 (1st Cir. 1992).   On the other hand, we review

denial of a motion for new trial under an abuse of discretion

standard,  with a view  toward whether  "`the verdict  was so

clearly against the weight of the evidence as  to amount to a

manifest miscarriage of justice.'"   Pontarelli v. Stone, 930
                                                        

F.2d 104, 113  (1st Cir. 1991) (quoting Hendricks  &amp; Assocs.,
                                                             

Inc. v. Daewoo Corp., 923 F.2d 209, 217 (1st Cir. 1991)). 
                    

          Cognetics  presented   uncontroverted  evidence  at

trial that the Cognetics name  appeared on two separate Maven

products.  On the first occasion, the Cognetics name appeared

in  a Maven slide presentation  at the bottom  of every page.

On the second  occasion, it  appeared on the  first and  last

pages of  a 43-page Maven  presentation.  On  both occasions,

the Maven products were produced without the use of Cognetics

software.9   Cognetics  argues  that this  evidence can  only

                    

9.  Cognetics  cites  a  third   and  different  use  of  the
Cognetics name in arguing that section 2(b) was breached.  On
this  third occasion, PH used the Cognetics name in a product
proposal, but  the final  product used neither  the Cognetics
name or software.   We fail  to see how such evidence relates
to sublicensing.  PH's  use of the Cognetics name  in product
proposals  is clearly  contemplated by  the Agreement.   More
importantly,  this third  example  presents no  evidence that
Maven, or any other  alleged "sublicensee," actually used the

                             -11-
                              11

lead  to one  conclusion,  namely, that  PH breached  section

2(b),10  the   Agreement's   sublicensing  provision.      We

disagree.

          In  determining whether a breach of the Agreement's

sublicensing provision has occurred, we must first define the

terms "licensing" and "sublicensing" as they are used  in the

Agreement.  We consider the terms "in light of all the  other

phraseology  in  the  instrument,"   and  "in  light  of  the

circumstances of the transaction."  McDonald's Corp. v. Lebow
                                                             

Realty Trust, 888 F.2d 912, 913-14 (1st Cir. 1989) (citations
            

omitted).  

                    

Cognetics name or software.   PH's use of the  Cognetics name
in  this  situation might  support a  claim that  PH breached
section 11(e) of the Agreement, which states that  neither PH
nor  its affiliates  may market  products which  compete with
Cognetics products. However, this  evidence does not  support
Cognetics'  claim that PH  improperly sublicensed  its rights
under the Agreement.

10.  Section 2(b) provides:

     Sublicense  Right.   Cognetics  grants to  [PH] the
     right to sublicense its  rights under Section  2(a)
     to  an entity or entities which are wholly owned by
     [PH],  provided however,  that  (i)  [PH]  notifies
     Cognetics in advance and in writing with respect to
     such  sub-license, (ii)  the foregoing  right shall
     not  relieve [PH]  from its  obligations hereunder,
     and (iii)  such sub-licensee  is subject to  all of
     the   terms  and  conditions   of  this  Agreement.
     Cognetics  may, in  advance  of  such  sub-license,
     require  any reasonable  documentation of  [PH] and
     its sub-licensee in order to  assure sub-licensee's
     agreement to the foregoing.

                             -12-
                              12

          As  we  read  section  2(a)11   of  the  Agreement,

licensing  consists of three elements:  (1) an agreement; (2)

which  permits the  licensee  to use  the  Cognetics name  in

tandem  with  the  Cognetics  software;  (3)  in  an  ongoing

commercial manner.  These  three characteristics ensure  that

PH, the licensee, can  establish a viable consulting business

in Europe through the use of the Cognetics name and software.

          Section  2(b),  in turn,  grants  PH  the right  to

"sublicense" its  rights under the Agreement  to wholly owned

third  parties.    Sublicensing  under  2(b)  is  similar  to

licensing under 2(a).  It consists of:  (1) an agreement; (2)

whereby  PH  grants  a  third  party  permission  to  use the

Cognetics name in tandem with the Cognetics software; (3) for

ongoing commercial purposes.  

                    

11.  Section 2(a) provides:

     Software and Name License.  Cognetics hereby grants
                              
     to Licensee the  exclusive, non-transferable  right
     and license without right  of sublicense, except as
     specifically  provided  in  subsection (b)  hereof,
     (the "License"), to (i) use the Object Code version
     of  the   [Cognetics]  Software  and   any  Related
     Software,   including  but   not  limited   to  any
     Improvements, and all Software  Documentation, (ii)
     use and  to commercialize the  Name, including  but
     not limited  to  as part  of the  Name under  which
     Licensee  does business  in  the  European  Market,
     provided, however,  that use  of the Name  shall be
     solely in respect of [Cognetics] Products and (iii)
     use,  market, sell  and otherwise  to commercialize
     the  Products,  provided   however,  that  all  the
     foregoing  is granted throughout  but solely within
     the European Market. 

                             -13-
                              13

          In  order  to  prove  a  breach  of  section  2(b),

Cognetics  would first have  to establish the  existence of a

sublicensing agreement between PH and Maven.  Cognetics would

then have to  show that the  sublicensing was improper  under

section  2(b)  or  some  other provision  of  the  Agreement.

Cognetics  has failed to allege or  demonstrate that any such

sublicensing occurred.

          Both  at trial  and on  appeal, Cognetics  seems to

rely  on  the  mistaken assumption  that  any  misuse  of the

Cognetics  name  by  Maven  or  PH,  whether  intentional  or

inadvertent, conclusively  demonstrates improper sublicensing

in breach  of section 2(b) on  the part of PH.   However, not

all misuses  of the  Cognetics name by  non-sublicensed third

parties amount to breaches of  section 2(b).  General misuses

of  the Cognetics name may be actionable under several of the

Agreement's  provisions.12   However, in  order to  give rise

to a claim under section 2(b), the  misuse must take place in

the context of an improper sublicensing agreement. 

          At  trial, PH's  principals testified  that Maven's

misuse  was  essentially  inadvertent.    For  example,  Rolf

                    

12.  For  example, section  6(c) states  that PH  acquires no
proprietary interest in the Cognetics name; section 11 states
that both  parties agree  to preserve the  confidentiality of
proprietary material;  section 14 states that  PH will notify
Cognetics  of any  infringements  of the  Agreement by  third
parties; and section  16 states  that PH may  not assign  its
rights or  obligations under the  contract without Cognetics'
consent.   

                             -14-
                              14

Hickmann, a principal  of both PH  and Maven, testified  that

the use of  the Cognetics name in Maven's  slide presentation

was "careless," and  that, between them, PH  and Maven "could

only  afford  one  set  of stationery  for  slide  material."

Cognetics  offered no  contrary  evidence  showing  that  the

misuses of the Cognetics name were in fact due to an improper

sublicensing agreement.

          At best, Cognetics has demonstrated  that PH and/or

Maven misused  the Cognetics name on two occasions.  Standing

alone,  this evidence  of misuse  does not  conclusively show

that PH improperly  sublicensed its rights to Maven,  or that

PH breached section 2(b) of the Agreement.  Thus, contrary to

Cognetics' claim in its  post-trial motion, the evidence does

not  lead inexorably  to  the conclusion  that PH  improperly

sublicensed  its rights to Maven in breach of section 2(b) of

the  Agreement.  A reasonable  jury could have concluded that

Maven's  misuse of the  Cognetics name  was inadvertent.   In

fact, we find  no evidence in the record  which would allow a

jury to conclude otherwise.   Accordingly, the district court

properly denied Cognetics' motion for judgment n.o.v.  

          By  the  same token,  the  verdict  is not  clearly

against the  weight of the evidence and  presents no manifest

                             -15-
                              15

miscarriage of  justice.  Thus, the  district court committed

no error in denying Cognetics' motion for new trial.13

          For  the foregoing  reasons,  the judgment  of  the

district court is affirmed.
                          

                    

13.  Cognetics   also   challenges   the   district   court's
instructions to the jury on section 2(b).  The district court
instructed the jury that  only "material" breaches of section
2(b)  give  rise  to  a right  to  terminate  the  Agreement.
Cognetics  argues  that  under  the  Agreement,  non-material
breaches  of  section  2(b) also  give  rise  to  a right  to
terminate,  and  that  the  district court's  failure  to  so
instruct entitles it to judgment n.o.v. or a new trial.
     We assume without deciding that non-material breaches of
section 2(b) give rise to a right to terminate.  Nonetheless,
as we  have  noted  above,  Cognetics  failed  to  allege  or
demonstrate a breach of  section 2(b), material or otherwise.
Thus,  even if  the district  court's instruction  on section
2(b) was incorrect, the evidence does not necessarily lead to
the conclusion  that a non-material breach  of 2(b) occurred.
Nor can we say  that the verdict was  so clearly against  the
weight of the evidence as to amount to a manifest miscarriage
of justice.  Accordingly, Cognetics' argument  regarding jury
instructions  does  not  alter  our  determination  that  the
district court properly denied Cognetics' motion for judgment
n.o.v. or new trial.

                             -16-
                              16
