Barbagallo v. Marcum LLP
Opinion
SUMMARY ORDER
Plaintiff Joseph S. Barbagallo (“Barba-gallo”) appeals from the January 10, 2013 judgment of the District Court, after a seven-day bench trial, denying Barbagal-lo’s breach of contract claim against his former employer Marcum LLP (“Mar-cum”) for, inter alia, retirement benefits, on the ground that Barbagallo materially breached his contract with Marcum. Mar-cum cross-appeals the District Court’s judgment insofar as it held that Marcum suffered no compensable injury from Bar-bagallo’s breach of his duty of loyalty, and that Marcum was not entitled to recover costs from Barbagallo. We assume the parties’ familiarity with the factual and procedural background of the case and the issues on appeal.
BACKGROUND
On September 1, 2009, Barbagallo, a certified public accountant, and Marcum entered into an employment agreement (the “Agreement”), which governs this dispute. Around March 2010, Barbagallo began communicating with Richard Tuscano, a potential client he met at a Marcum networking event. In June 2010, Barba-gallo began conversations with Citrin Coo-perman & Company LLC (“Citrin”), a competing accounting firm. On July 23, 2010, Barbagallo and Citrin reached an agreement, and Barbagallo submitted a letter to Marcum withdrawing from his employment. Pursuant to the ninety-day notice requirement in the Agreement, Bar-bagallo continued to work at Marcum for 100 days, during which time he provided services to Tuscano. Instead of billing those services to Marcum, he diverted the business to Citrin. In December 2010, Barbagallo requested retirement benefits from Marcum pursuant to the Agreement. Marcum denied the request. This lawsuit followed.
DISCUSSION
On appeal from a district court judgment following a bench trial, we review findings of fact for clear error, and conclusions of law de novo. Carco Group, Inc. v. Maconachy, 718 F.3d 72, 79 (2d Cir. 2013). The District Court concluded that Barba-gallo had committed a material breach of the Agreement by his conduct with respect to Tuscano. It concluded further, that as a result of the material breach, occurring at the latest on August 9, 2010, the contract was terminated, relieving Marcum of the obligation to pay Barbagallo retirement benefits upon his departure. Id.
The District Court also denied Marcum’s counter-claim for damages arising out of Barbagallo’s alleged breach of his duty of loyalty to Marcum, on the ground that there were “no damages for Marcum to recover ... because no contract existed *104 when Barbagallo did significant work on this matter.” Special App’x 36-37. Because we find no error of law or fact in the District Court’s conclusions, we affirm the judgment of the District Court insofar as it denied Barbagallo retirement benefits, and denied Marcum damages for Barbagallo’s breach of fiduciary duty, for substantially the reasons stated by the District Court in its January 9, 2013 Order.
Marcum also appeals the portion of the judgment denying costs to either party. We review a denial of costs for “abuse of discretion.” See Harris Trust & Sav. Bank v. John Hancock Mut. Life Ins. Co., 302 F.3d 18, 26 (2d Cir. 2002). 1 During oral argument following Barbagallo’s motion to amend pursuant to Federal Rule of Civil Procedure 59(e), the District Court clarified the basis for its decision on costs: “I don’t think either party is prevailing. Both parties asked for affirmative relief and I gave none.” Special App’x 49. This was not an “abuse of discretion.” Accordingly, we affirm the judgment of the District Court insofar as it denied costs.
CONCLUSION
We have reviewed the parties’ arguments on appeal and find them to be without merit for the reasons stated above. Accordingly, we AFFIRM the January 10, 2013 judgment of the District Court.
. "Abuse of discretion" is a term of art that encompasses a decision that rests on an error of law or a clearly erroneous factual finding or otherwise "cannot be located within the range of permissible decisions.” McDaniel v. County of Schenectady, 595 F.3d 411, 416 (2d Cir. 2010) (internal quotation marks omitted).
Reference
- Full Case Name
- Joseph S. BARBAGALLO, Plaintiff-Appellant-Cross-Appellee, v. MARCUM LLP, Defendant-Appellee-Cross-Appellant
- Status
- Unpublished