[Cite as Harris v. Vision Energy, L.L.C., 2024-Ohio-2878.]
IN THE COURT OF APPEALS FIRST APPELLATE DISTRICT OF OHIO HAMILTON COUNTY, OHIO
JEFF HARRIS, : APPEAL NOS. C-230406 C-230425 Plaintiff-Appellant/Cross- : TRIAL NO. A-1905743 Appellee, : vs. : O P I N I O N. VISION ENERGY, LLC, : TURNER HUNT, : MARCI BURTON, : and : BRENT CREEK, : Defendants-Appellees/Cross- Appellants. :
Civil Appeals From: Hamilton County Court of Common Pleas
Judgments Appealed From Are: Affirmed in Part, Reversed in Part, and Cause Remanded
Date of Judgment Entry on Appeal: July 31, 2024
Blessing & Wallace LLC and William H. Blessing, for Plaintiff-Appellant/Cross- Appellee,
Dressman Benzinger LaVelle PSC and Kevin F. Hoskins, for Defendants- Appellees/Cross-Appellants. OHIO FIRST DISTRICT COURT OF APPEALS
BERGERON, Judge.
{¶1} For several years, Vision Energy, LLC, (“Vision”) an Ohio-based
company, contracted with plaintiff-appellant Jeff Harris, an Ohio resident, to develop
a wind farm project in Illinois. After the project initially failed and Vision and Mr.
Harris parted ways, he got wind that Vision sold the farm to a European company in a
lucrative transaction. But he never saw any income from that sale, despite his four
percent ownership interest in the special project company created to operate the farm.
Litigation ensued, and an arbitration panel eventually awarded him breach of contract
damages. Before that arbitration, however, the trial court dismissed his claim under
an Illinois wage law on the grounds that the parties’ choice of Ohio law in the written
agreement precluded application of Illinois law. Based on an intervening decision
from the Seventh Circuit interpreting that statute, we reverse the trial court’s dismissal
in order to allow Mr. Harris to continue pursuing his claim under Illinois law (although
we solely decide this on the pleadings and express no view on the ultimate merit of the
claim). We otherwise affirm the judgments of the trial court splitting trial court costs
between the parties and confirming the award of arbitration costs to Mr. Harris.
I.
{¶2} Vision, an Ohio company with an office in Cincinnati, entered an
“Independent Contractor’s Agreement” (“Contractor’s Agreement”) with Mr. Harris in
2007, hiring him for specific duties relating to a windmill farm energy project (the “K4
Wind Farm”) across several counties in Illinois. Mr. Harris’s duties mostly overlapped
with Vision’s duties (with the exception of land acquisition, which fell solely within his
province) and included assisting with development schedules, government relations,
permits and approvals, risk assessment, and other “local activities.” They renewed the
2 OHIO FIRST DISTRICT COURT OF APPEALS
Contractor’s Agreement annually from 2007 through 2010 through a markup of the
original.
{¶3} Vision agreed to pay Mr. Harris $15,000 per month plus reasonable
expenses and agreed to provide “a four percent (4%) ownership interest in the project
company that will be created as a special purpose vehicle to hold all assets related to
the K4 Wind Farm,” per the Contractor’s Agreement. The resulting project company
was Friends of K4, LLC, (“FK4”) which was incorporated in Delaware and had a
Cincinnati, Ohio, mailing address. According to the original FK4 Operating
Agreement (the “FK4 Agreement”), its members were Vision (designated as president,
secretary, and treasurer), Mr. Harris, Marci Burton, and Brent Creek. The latter three
each owned voting and nonvoting units in the company, but Vision held no more than
a nominal interest in the LLC.
{¶4} In October 2010, Turner Hunt, Vision’s sole owner, informed Mr. Harris
that he was shutting down the K4 Wind Farm. Mr. Harris saw an opportunity, and the
two entered an agreement for him to purchase the wind farm for $8 million. But after
seeking funding for the purchase, he ultimately informed Mr. Hunt in February 2011,
shortly before the planned closing of the sale, that he could not move forward with the
purchase. Mr. Hunt pocketed the $150,000 that Mr. Harris had paid him as a deposit
for the sale, and further communication broke down.
{¶5} After the collapse of that deal, Mr. Harris claimed that Mr. Hunt, Ms.
Burton, and Mr. Creek conspired throughout 2011 and 2012 to dispossess him of his
ownership interest in FK4 and any future proceeds from it. At some point, he received
an email offer from Ms. Burton and Mr. Creek to purchase his FK4 membership for
$30,000 but did not accept it. He alleged that Mr. Hunt then “concocted, fabricated,
3 OHIO FIRST DISTRICT COURT OF APPEALS
and forged a bogus operating agreement for [FK4],” which he believed altered their
original FK4 Agreement to remove his voting membership and to orchestrate several
other changes unfavorable to him. He was allegedly removed and divested from FK4
and replaced with Vision as a unit owner, all without any notification or
communication from Vision or Mr. Hunt.
{¶6} Later, in 2017, Mr. Harris claimed that an employee for Vision informed
him that Mr. Hunt had sold the K4 Wind Farm to a large French-owned utility
company, EDF, and that income had been distributed to members. Around this time,
Mr. Harris allegedly received the “forged” version of the FK4 Agreement, which
removed him as an owner. He then presented an arbitration demand to FK4’s attorney
pursuant to an arbitration provision of the original FK4 Agreement.
{¶7} That effort went nowhere, and Mr. Harris eventually filed suit against
defendants-appellees/cross-appellants Vision, Mr. Hunt, Ms. Burton, and Mr. Creek
(together, “Defendants”) in December 2019, later amending his complaint in February
2021. Against Defendants, Mr. Harris claimed conspiracy and concerted action with
damages, conversion, breach of employment contract regarding the Contractor’s
Agreement (against only Vision and Mr. Hunt), breach of employment contract
regarding the FK4 Agreement, and breach of fiduciary duty. He sought compensatory
damages, punitive damages, interest, attorney fees, and declaratory relief.
{¶8} Under both of his breach of contract claims, he sought a right to relief
under the Illinois Wage Payment & Collection Act (“IWPCA”), 820 ILCS 115/1, which
declares that “[t]his Act applies to all employers and employees in this State,” with
exceptions for state and federal employees. Mr. Harris insisted that he was an
employee of Vision and was thus entitled to underpaid wages under Section 115/14 of
4 OHIO FIRST DISTRICT COURT OF APPEALS
the IWPCA because he realized no income from the sale of FK4 to EDF. Defendants
moved to dismiss the IWPCA claim1 in March 2021 on the basis that only Ohio
employment law applied, pursuant to a choice of Ohio law clause in the Contractor’s
Agreement that read: “The validity, interpretation, and performance of this Agreement
shall be governed by and construed in accordance with the laws of Ohio applicable to
agreements made and performed entirely within Ohio.” Defendants maintained that
the IWPCA did not apply to Mr. Harris because of the choice of Ohio law provision,
but even if it did govern, the claim failed because he was a contractor and not an
employee and because equity distributions from the sale of FK4 were not recoverable
under the act. The trial court granted Defendants’ partial motion to dismiss the
IWPCA claim in July 2021, applying Ohio’s conflict of laws rules and determining that
the choice of Ohio law clause controlled, precluding application of Illinois wage laws
to Mr. Harris’s work for Vision.
{¶9} In October 2021, the trial court referred the remaining claims to
arbitration. The parties entered into a signed “Arbitration Agreement” in November
2021, which included an agreement that the costs of the arbitration would be split
between the parties 50/50. The three-arbitrator panel ultimately awarded Mr. Harris
$413,216 in monetary damages and prejudgment interest for his common law breach
of contract claims but rejected all of his other claims. It also awarded him $55,779.26
in arbitration costs, taxed entirely against Vision and Mr. Hunt. The trial court
confirmed the panel’s decision without any changes, overruled several attacks on the
award by Defendants, and imposed half of the trial court costs on Mr. Harris and half
on Defendants. In confirming the arbitration costs award, it relied on an unsigned
1 Although Mr. Harris raised the IWPCA under multiple breach of contract claims in his amended
complaint, the parties refer to it as a single “IWPCA claim,” and we follow suit. 5 OHIO FIRST DISTRICT COURT OF APPEALS
“Preliminary Conference Order,” generated at the start of the arbitration proceedings,
which purported to govern the arbitration. Mr. Harris appealed the dismissal of his
IWPCA claim and the decision to impose half of the trial court costs on him, and
Defendants cross-appealed the confirmation of the arbitration costs award.
II.
{¶10} We begin with the dismissal of Mr. Harris’s IWPCA claim, which
involves the complex relationship between Ohio’s and Illinois’s wage laws, conflict of
laws concepts, and the choice of law provision of the Contractor’s Agreement. Mr.
Harris claims Defendants violated Section 115/14 of the IWPCA by failing to pay him
“final compensation” in the form of equity distributions owed to him for the sale of
FK4, which occurred in or around 2014. At that time, the IWPCA afforded the
following protection:
Any employee not timely paid wages, final compensation, or wage
supplements by his or her employer as required by this Act shall be
entitled to recover through a claim filed with the Department of Labor
or in a civil action, but not both, the amount of any such underpayments
and damages of 2% of the amount of any such underpayments for each
month following the date of payment during which such underpayments
remain unpaid. In a civil action, such employee shall also recover costs
and all reasonable attorney's fees.
820 ILCS 115/14 (effective 2014). The statute remains largely unchanged today,
except the two percent damages is now five percent. 820 ILCS 115/14 (effective 2023).
{¶11} In reviewing a trial court’s dismissal of a claim under Civ.R. 12(B)(6),
this court assesses the sufficiency of the complaint, taking its allegations as true and
6 OHIO FIRST DISTRICT COURT OF APPEALS
drawing reasonable inferences in favor of the nonmoving party. Mitchell v. Lawson
Milk Co., 40 Ohio St.3d 190, 192, 532 N.E.2d 753 (1988). Ohio courts grant a motion
to dismiss “only when it appears beyond doubt that the plaintiff can prove no set of
facts in support of his claim which would entitle him to relief.” Greenwood v. Taft,
105 Ohio App.3d 295, 297, 663 N.E.2d 1030 (1st Dist.1995), citing O’Brien v. Univ.
Community Tenants Union, Inc., 42 Ohio St.2d 242, 327 N.E.2d 753 (1975). This
court reviews the trial court’s decision to grant a motion to dismiss under Civ.R.
12(B)(6) de novo. Inwood Village, Ltd. v. City of Cincinnati, 1st Dist. Hamilton No.
C-110117, 2011-Ohio-6632, ¶ 8, citing Perrysburg Twp. v. City of Rossford, 103 Ohio
St.3d 79, 2004-Ohio-4362, 814 N.E.2d 44, ¶ 5.
A.
{¶12} To begin our conflict of laws analysis, we first acknowledge Mr. Harris’s
argument that, under a recent decision of the federal circuit court that includes
Illinois, claims under the IWPCA arise from a claimant’s work in Illinois, independent
of any choice of foreign state law provision agreed to by the parties. See Johnson v.
Diakon Logistics, Inc., 44 F.4th 1048, 1052-1053 (7th Cir.2022).2 In that case, two
truck drivers who moved goods from an Illinois warehouse to in-state and out-of-state
destinations sued Diakon, which had its principal place of business in Virginia, under
the IWPCA. Despite a choice of Virginia law provision in the parties’ contracts, the
court held that “plaintiffs’ claims to undiminished wages arise from their work in
Illinois, not from their contracts.” Id. at 1052. It thus reversed an order granting
Diakon summary judgment and allowed the IWPCA claims to proceed. Id. at 1053.
2 On appeal, Defendants curiously decline to substantively engage with Diakon. When one side relies heavily on a new case that appears (on its face, at least) substantively to control the outcome, it generally behooves the other side to at least offer their perspective on the case, which certainly benefits our consideration of the matter. 7 OHIO FIRST DISTRICT COURT OF APPEALS
{¶13} The Diakon holding, which we find persuasive in our analysis, obviated
the need for a conflict of laws analysis to determine whether the choice of foreign state
law controls over Illinois law. But as an Ohio court, we are compelled to follow Ohio
precedent for how to apply conflict of laws rules when the parties dispute application
of a choice of law provision, and our courts tend to apply a conflict of laws analysis in
similar situations. See Am. Interstate Ins. Co. v. G & H Serv. Ctr., 112 Ohio St.3d 521,
2007-Ohio-608, 861 N.E.2d 524, ¶ 10 (applying Ohio’s conflict of laws rules to
determine that Ohio’s worker compensation laws governed); Ohayon v. Safeco Ins.
Co., 91 Ohio St.3d 474, 476-477, 747 N.E.2d 206 (2001) (applying Ohio’s conflict of
laws rules in an insurance contract dispute).
{¶14} As an Ohio trial court, the court below correctly applied the conflict of
laws rules (sometimes called the choice of law rules) of its own state. See Estate of
Sample v. Xenos Christian Fellowship, Inc., 2019-Ohio-5439, 139 N.E.3d 978, ¶ 17
(10th Dist.), citing Pevets v. Crain Communications, Inc., 6th Dist. Ottawa No. OT-
10-023, 2011-Ohio-2700, ¶ 32. Ohio has adopted the Restatement of the Law 2d,
Conflict of Laws (1971) “in its entirety.” Am. Interstate Ins. Co. at ¶ 7, citing Morgan
v. Biro Mfg. Co., Inc., 15 Ohio St.3d 339, 341-342, 474 N.E.2d 286 (1984); see Schulke
Radio Prods., Ltd. v. Midwestern Broadcasting Co., 6 Ohio St.3d 436, 438-439, 453
N.E.2d 683 (1983) (specifically adopting Section 187 of the Restatement). When the
parties have chosen the law of a certain state to govern their contractual rights and
duties, the court will apply that state’s law unless either:
(a) the chosen state has no substantial relationship to the parties or the
transaction and there is no other reasonable basis for the parties[’]
choice, or
8 OHIO FIRST DISTRICT COURT OF APPEALS
(b) application of the law of the chosen state would be contrary to a
fundamental policy of a state which has a materially greater interest
than the chosen state in the determination of the particular issue and
which, under the rule of § 188, would be the state of the applicable law
in the absence of an effective choice of law by the parties.
Restatement, Section 187.
{¶15} The trial court concluded that Ohio had a substantial relationship to the
parties, see Restatement, Section 187(a), because Vision is an Ohio limited liability
company and paid for rental property in Ohio for Mr. Harris. We agree, and thus we
focus our attention on Section 187(b). Regarding that part of the test, the court held
that both Illinois and Ohio “have a policy interest in wage protection and employment
law issues,” and that the major difference between the two states’ wage laws is whether
attorney fees can be awarded. See 820 ILCS 115/14 (providing for reasonable attorney
fees). It held that this difference was “not contrary to the policies of the states” and
that “Ohio wage laws are not repugnant to the policies or laws of Illinois.” Therefore,
it concluded, the choice of Ohio law provision prevailed and precluded Mr. Harris’s
claim under the IWPCA.
{¶16} Applying Section 187, we first note that the parties do not substantially
brief whether Ohio or Illinois would be the state of applicable law under Section 188,
which governs absent a choice of law agreement. Given that Illinois was the place of
performance and the subject matter of the contract, we view it as the state with the
“most significant relationship to the transaction and the parties” and thus as the state
of applicable law under Section 188. Restatement, Section 188(1) and (2). Since this
differs from the parties’ choice of Ohio law agreement, we confront a genuine dispute
9 OHIO FIRST DISTRICT COURT OF APPEALS
over whether Illinois or Ohio law is best suited to govern. Accord Cotter v. Lyft, Inc.,
60 F.Supp.3d 1059, 1061 (N.D.Cal.2014) (“A court conducts a conflict of laws analysis
only where the laws of multiple states could conceivably apply to the same claim.
Where only one state’s law applies, no such analysis is necessary.”).
{¶17} Next, continuing through the Section 187(b) test, we are mindful that
“[t]he forum will apply its own legal principles in determining whether a given policy
is a fundamental one within the meaning of the present rule and whether the other
state has a materially greater interest than the state of the chosen law in the
determination of the particular issue.” Restatement of the Law 2d, Conflict of Laws,
Section 187, Comment g. Although Ohio case law lacks much guidance on how to apply
these considerations, at least one court has relied on the case law of the other state in
question, and we find its reasoning persuasive. See Century Business Servs. v. Barton,
197 Ohio App.3d 352, 2011-Ohio-5917, 967 N.E.2d 782, ¶ 65-69 (8th Dist.) (holding
that application of Ohio law was not contrary to a fundamental policy of Minnesota
after comparing Minnesota and Ohio case law on the relevant contract laws of the
respective states).
{¶18} Under Section 187(b), we must determine whether, based on Illinois
law, the IWPCA represents a “fundamental” policy of that state. “To be ‘fundamental,’
a policy must in any event be a substantial one,” which “may be embodied in a statute
which makes one or more kinds of contracts illegal or which is designed to protect a
person against the oppressive use of superior bargaining power.” Restatement,
Section 187, Comment g. According to Illinois courts, “[t]he primary objective of the
[IWPCA] is to ensure employees receive all earned benefits upon leaving their
employer and the evil it seeks to remedy is the forfeiture of any of those benefits.”
10 OHIO FIRST DISTRICT COURT OF APPEALS
Mueller Co. v. Dept. of Labor, 187 Ill.App.3d 519, 524, 543 N.E.2d 518 (1989); see also
People ex rel. Martin v. Lipkowitz, 225 Ill.App.3d 980, 985, 589 N.E.2d 182 (1992)
(“[T]he public has a clear and definite interest in enforcing the IWPCA.”).
Furthermore, the Seventh Circuit’s holding in Diakon—that an Illinois worker’s rights
under the IWPCA cannot be waived by a choice of foreign state law provision
purporting to preempt Illinois law—reinforces the fundamental importance of the law
to the state. Diakon, 44 F.4th at 1052 (“The [IWPCA] governs payment for work in
Illinois regardless of what state’s law governs other aspects of the parties’ relations.”).
Based on this case law, the IWPCA codifies Illinois’s substantial interest in protecting
its workers against the power of their employers to deny them contractual benefits.
Accordingly, we conclude that the IWPCA represents a substantial and fundamental
policy of Illinois.
{¶19} Next, we consider whether application of Ohio law would be contrary to
that fundamental policy. On this point, we confront a weak premise at the heart of the
trial court’s dismissal order: the possibility that Ohio wage laws apply to and protect
Mr. Harris’s work performed in Illinois. Although Ohio certainly has a general interest
in protecting the wages of Ohio workers, “[g]enerally, statutes are presumed not to
have an extraterritorial effect unless the legislature clearly manifests a contrary
intent.” Mitchell v. Abercrombie, S.D.Ohio No. C2-04-306, 2005 U.S. Dist. LEXIS
48410, *6 (May 17, 2005), citing Sale v. Haitian Ctrs. Council, Inc., 509 U.S. 155, 188,
113 S.Ct. 2549, 125 L.Ed.2d 128 (1993). Ohio’s Prompt Pay Act, R.C. 4113.15, identified
by Mr. Harris as the closest Ohio equivalent to the IWPCA, governs the duties of
“[e]very employer doing business in this state,” R.C. 4113.15(A), and “applies to
employment (and employees) in Ohio” because “[s]tate wage and hours statutes
11 OHIO FIRST DISTRICT COURT OF APPEALS
govern employees in the state in which they are employed.” (Alteration in original.)
Osborn v. Knights of Columbus, N.D.Ohio No. 3:04CV7486, 2005 U.S. Dist. LEXIS
2955, *7 (Mar. 1, 2005) (holding that Ohio’s wage laws, not Connecticut’s, governed
because plaintiff’s work was performed in Ohio, “notwithstanding the parties’
contractual agreement that Connecticut law applies to their contract”). In support of
its argument that R.C. 4113.15 extends to Illinois to protect Mr. Harris’s work there,
Defendants cite no Ohio precedent or public policy manifesting the General
Assembly’s intent for the extraterritorial application of that law.
{¶20} Nonetheless, at this stage, it is unnecessary to determine whether Ohio’s
wage laws could conceivably apply to work outside of the state. For the purposes of
this appeal and of the conflict of laws analysis, we merely conclude that Defendants
have not demonstrated that Ohio’s wage laws can protect Mr. Harris’s Illinois-based
work. Given that conclusion, enforcing the parties’ choice of Ohio law provision here
would lead to an untenable result where, despite Illinois’s fundamental policy of
protecting wages through the IWPCA, Mr. Harris would have worked in that state for
years without the protection of any state’s wage laws. He would then be left in a legal
void of wage protection, and such a result is contrary to Illinois’s fundamental policy
as expressed through the IWPCA.
{¶21} The void-of-protection result also showcases that Illinois has a
materially greater interest than Ohio in the issue of whether Mr. Harris’s work in
Illinois was protected by any wage protection laws. The Seventh Circuit’s holding in
Diakon that an Illinois employee’s rights under the IWPCA cannot be contracted away
through a choice of law provision also reinforces the strong interest of the state in
ensuring its workers are not deprived of statutory rights by the attempted substitution
12 OHIO FIRST DISTRICT COURT OF APPEALS
of foreign state law, which may ultimately prove inapplicable. See Diakon, 44 F.4th at
1052-1053 (“[N]othing about choosing Virginia law affects plaintiffs’ claims under the
Act.”). Simply put, refusing to apply Illinois law to Mr. Harris’s work in Illinois would
raise comity concerns and threaten the effectiveness of fundamental Illinois law in
protecting workers in that state.
{¶22} Therefore, under Section 187 of the Restatement, the parties’
contractual choice of Ohio law provision cannot control because applying it would be
contrary to a fundamental policy of Illinois, which has a greater material interest than
Ohio in determining whether Mr. Harris’s work in Illinois was protected by wage laws.
Of course, Mr. Harris still must demonstrate that he is entitled to relief under the
IWPCA, but we leave those questions (including whether he is an “employee” who was
deprived of “final compensation” under the IWPCA) for further proceedings before the
trial court on remand.
B.
{¶23} Finally, we resolve several ancillary issues relating to the first
assignment of error. First, Defendants maintain that Mr. Harris’s appeal of the
IWPCA claim dismissal is moot because Mr. Harris “accepted the payment” from
Defendants for satisfaction of the final judgment against them as confirmed by the
trial court in its July 2023 entry. As he indicated in his October 2023
“Acknowledgment of Payments Toward Satisfaction of July 21, 2023 Judgment
Entry,” Mr. Harris argues that the acknowledgment does not foreclose his appeal
regarding issues not resolved by that judgment entry, including his IWPCA claim and
his claims regarding trial court costs and prejudgment interest on the arbitration costs.
{¶24} Defendants rely on the principle that:
13 OHIO FIRST DISTRICT COURT OF APPEALS
[A] satisfaction of judgment renders an appeal from that judgment
moot. “ ‘Where the court rendering judgment has jurisdiction of the
subject-matter of the action and of the parties, and fraud has not
intervened, and the judgment is voluntarily paid and satisfied, such
payment puts an end to the controversy, and takes away from the
defendant the right to appeal or prosecute error or even to move for
vacation of judgment.’ ”
Blodgett v. Blodgett, 49 Ohio St.3d 243, 245, 551 N.E.2d 1249 (1990), quoting Rauch
v. Noble, 169 Ohio St. 314, 316, 159 N.E.2d 451 (1959), quoting Lynch v. Lakewood
City School Dist. Bd. of Edn., 116 Ohio St. 361, 156 N.E. 188 (1927), paragraph three of
the syllabus.
{¶25} But Defendants’ argument misses the mark, because Mr. Harris is
appealing the trial court’s July 2021 dismissal of his IWPCA claim on the grounds that
Illinois law does not apply, which is a separate entry from the one confirming the
arbitration award. That is why, in fact, we have two separate appellate cases to resolve
in this matter. Further, in a case similar to this one, the Twelfth District held that a
satisfaction of judgment that applied only to plaintiffs’ parental liability statute claims
did not preclude plaintiffs’ appeal of “the trial court’s dismissal of [plaintiffs’]
negligent supervision and NIED claims” that were disposed of before trial. Ross v.
Wendel, 2017-Ohio-7804, 97 N.E.3d 722, ¶ 20 (12th Dist.). In line with Ross, we hold
that Mr. Harris did not waive his right to appeal the separate dismissal of his IWPCA
claim by acknowledging payment of the arbitration award relating to his other claims.
{¶26} Second, Defendants justify the dismissal on the alternative ground that
Mr. Harris failed to sufficiently plead his IWPCA claim. To establish a violation of the
14 OHIO FIRST DISTRICT COURT OF APPEALS
IWPCA, a plaintiff must allege that “(1) the defendant was an ‘employer’ as defined in
the Wage Payment Act; (2) the parties entered into an ‘employment contract or
agreement’; and (3) the plaintiff was due ‘final compensation.’ ” Catania v. Local
4250/5050 of the Communications Workers of Am., 359 Ill.App.3d 718, 724, 834
N.E.2d 966 (2005), quoting 820 ILCS 115. In his amended complaint, Mr. Harris
claimed Defendants violated 820 ILCS 115/14 by withholding compensation in the
form of payments owed pursuant to his ownership interest, which he says qualifies as
“final compensation” under 820 ILCS 115/2 under the category of “any other
compensation owed the employee by the employer pursuant to an employment
contract or agreement between the 2 parties.” 820 ILCS 115/2. He alleged that he
worked in Illinois as an employee of Vision under Mr. Hunt’s direction and control at
all times until late 2010.
{¶27} By pleading that the income from the sale was final compensation owed
to him pursuant to a valid employment agreement with Vision, construing the
IWPCA’s broad definition of final compensation in his favor, Mr. Harris pleaded
sufficient facts to advance an IWPCA claim, and it is not beyond doubt that he cannot
recover under the act. Even so, we recognize a recent Illinois appellate court decision
involving Vision that might affect the viability of Mr. Harris’s claim at the summary
judgment stage on remand. See Vision Energy, LLC v. Smith, 2024 Ill.App.3d
230289-U, 2024 Ill. App. Unpub. LEXIS 1275, ¶ 69 (holding that a former employee’s
IWPCA claim against Vision for unpaid royalties did not qualify as “final
compensation” due at the time of her separation from employment and affirming a
grant of summary judgment to Vision). We leave to the trial court on remand the
question of how that decision (which is notably nonprecedential and only persuasive
15 OHIO FIRST DISTRICT COURT OF APPEALS
authority) relates to Mr. Harris’s claim for unpaid equity distributions, which simply
cannot be determined on the face of the pleadings. Drawing reasonable inferences in
his favor at this stage, Mr. Harris sufficiently pleaded his claims.
{¶28} Third, Defendants argue that their payment of the final judgment award
to Mr. Harris satisfied his claim for lost wages under the IWPCA. Although it is
certainly possible the arbitration award overlaps with Mr. Harris’s IWPCA damages
claim in a way that would preclude further recovery, we do not have a developed
record, at the pleadings stage, to decide that question. Any potential collateral
estoppel issues regarding the IWPCA claim are likewise best suited for trial court
resolution. Defendants and Mr. Harris will have the opportunity to develop these
arguments on remand.
{¶29} Fourth, Mr. Harris argues that application of Ohio wage laws in place of
Illinois wage laws would violate the Dormant Commerce Clause doctrine. Because we
determine that his Illinois law claim can continue on remand, we need not address the
constitutional question he raises. See Ohioans for Fair Representation v. Taft, 67
Ohio St.3d 180, 183, 616 N.E.2d 905 (1993), quoting Hall China Co. v. Pub. Util.
Comm., 50 Ohio St.2d 206, 210, 364 N.E.2d 852 (1977) (“ ‘Ohio law abounds with
precedent to the effect that constitutional issues should not be decided unless
absolutely necessary.’ ”).
{¶30} Ultimately, we sustain Mr. Harris’s first assignment of error and
conclude that the trial court erred in dismissing his IWPCA claim because, under
Ohio’s conflict of laws rules, Illinois law applies to his claim and prevails over the
choice of Ohio law provision in the Contractor’s Agreement.
16 OHIO FIRST DISTRICT COURT OF APPEALS
III.
{¶31} In his second assignment of error, Mr. Harris argues that the trial court
erred in taxing half of the trial court costs to him rather than taxing all of the costs to
Defendants. Under Civ.R. 54(D), “[e]xcept when express provision therefor is made
either in a statute or in these rules, costs shall be allowed to the prevailing party unless
the court otherwise directs.” This rule “grants the court discretion to order that the
prevailing party bear all or part of his or her own costs,” but the rule does not
“empower[] the court to award costs to a non-prevailing party.” Vance v.
Roedersheimer, 64 Ohio St.3d 552, 555, 597 N.E.2d 153 (1992). We review allocations
of costs under the rule for an abuse of discretion. State ex rel. Frailey v. Wolfe, 92
Ohio St.3d 320, 321, 750 N.E.2d 164 (2001), citing State ex rel. Reyna v. Natalucci-
Persichetti, 83 Ohio St.3d 194, 198, 699 N.E.2d 76 (1998). An abuse of discretion
occurs when “a court exercis[es] its judgment, in an unwarranted way, in regard to a
matter over which it has discretionary authority.” Johnson v. Abdullah, 166 Ohio
St.3d 427, 2021-Ohio-3304, 187 N.E.3d 463, ¶ 35.
{¶32} A party’s “prevailing party” status does not automatically entitle it to
avoid any and all trial court costs. See Vance at 555; Wolfe at 321. And “[d]eny[ing]
costs to both parties can be appropriate when neither party entirely prevails.”
Natalucci-Persichetti at 198; see also Paulozzi v. Iannotti, 8th Dist. Cuyahoga No.
103381, 2016-Ohio-5511, ¶ 46 (affirming a trial court’s decision to order the parties to
pay their own court costs where the plaintiff won on one claim, but defendant won on
the other because “neither party, or both parties depending on perspective, prevailed
on its claims.”). Accordingly, where a party prevails on some, but not all its claims,
this court has held that it is not an abuse of discretion to tax a portion of the trial court
17 OHIO FIRST DISTRICT COURT OF APPEALS
costs against that party. Capeheart v. O’Brien, 1st Dist. Hamilton No. C-040223,
2005-Ohio-3033, ¶ 18. In other words, where the verdict is split, there can be multiple
“prevailing parties” for the purposes of Civ.R. 54(D), and the rule permits a court to
tax costs against those parties in such a situation. See Foster v. Idegy, Inc., 10th Dist.
Franklin No. 13AP-948, 2014-Ohio-3015, ¶ 9, citing J&H Reinforcing v. Ohio School
Facilities Comm., 10th Dist. Franklin No. 13AP-732, 2014-Ohio-1963, ¶ 18 (“[A] trial
court does not commit an abuse of discretion in allocating court costs evenly between
two prevailing parties.”).
{¶33} Here, both parties prevailed on at least one claim. Despite Mr. Harris’s
substantial recovery on his general breach of contract claims, he recovered less than
half of what he requested, and the arbitrators and the trial court determined that
Defendants prevailed on all of Mr. Harris’s other tort claims and his requests for
punitive damages, attorney fees, and “double damages.” Therefore, we conclude both
Mr. Harris and Defendants qualify as “prevailing parties” under the rule, and taxing
costs equally against them both was thus permissible under Civ.R. 54(D) and does not
constitute an abuse of discretion. We overrule Mr. Harris’s second assignment of
error.
IV.
{¶34} Turning to the arbitration award, the parties each raise an argument on
appeal relating to the award of arbitration costs to Mr. Harris. We consider Mr.
Harris’s argument on prejudgment interest before addressing Defendants’ argument
about the costs award itself.
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{¶35} Mr. Harris argues the court erred by not awarding prejudgment interest
on the $55,779.26 in arbitration costs awarded to him pursuant to R.C. 1343.03 for the
time from the arbitration panel’s award (February 9, 2023) to the date the trial court
confirmed the award (July 31, 2023). But Mr. Harris identifies nowhere in the record
where he ever requested prejudgment interest under that statute, nor can we find such
a request. Because he never prompted the trial court (nor the arbitrators, it seems) to
consider such a request, Mr. Harris has no grounds to appeal the fact it did not award
it. See Feist v. Plesz, 9th Dist. Summit No. 21312, 2003-Ohio-2843, ¶ 21 (“[N]othing
in the record before this Court indicates that [plaintiff] ever requested prejudgment
interest from the arbitration panel * * *. Consequently, the trial court did not abuse
its discretion in denying [plaintiff’s] motion for prejudgment interest under R.C.
1343.03(A).”).
{¶36} Mr. Harris posits that he was nonetheless entitled to prejudgment
interest as a matter of law. Although it is true that “[o]nce a plaintiff receives judgment
on a contract claim, the trial court has no discretion but to award prejudgment interest
under R.C. 1343.03(A),” the statute does not mandate that the trial court sua sponte
award the interest without any party ever requesting it. Zunshine v. Cott, 10th Dist.
Franklin No. 06AP-868, 2007-Ohio-1475, ¶ 25, citing First Bank v. L.C., Ltd., 10th
Dist. Franklin No. 99AP-304, 1999 Ohio App. LEXIS 6504 (Dec. 28, 1999). Because
he failed to request prejudgment interest below, we decline to award it now, and we
overrule his third assignment of error.
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{¶37} In the sole assignment of error raised in their cross-appeal, Defendants
argue the trial court erred in confirming the arbitration panel’s decision to award Mr.
Harris the full amount of the arbitration costs, taxing it entirely against Defendants.
Defendants argue that the parties’ November 2021 Arbitration Agreement, which
definitively states “The cost of the arbitrators/Appraiser shall be paid 50/50 by Harris
and Defendants,” should have controlled the proceedings. The trial court below
rejected that argument, holding that the Preliminary Conference Order, which allowed
for arbitrator discretion over costs, prevailed and that the panel’s costs award did not
fall outside of that discretion.
{¶38} “When reviewing a trial court’s decision to confirm, modify, vacate, or
correct an arbitration award, an appellate court should accept findings of fact that are
not clearly erroneous but should review questions of law de novo.” Portage Cty. Bd.
of Dev. Disabilities v. Portage Cty. Educators’ Assn. for Dev. Disabilities, 153 Ohio
St.3d 219, 2018-Ohio-1590, 103 N.E.3d 804, ¶ 2. “R.C. Chapter 2711 provides the
exclusive statutory remedy for appealing arbitration awards to the courts of common
pleas.” DiPietrantonio v. City of Norwood, 1st Dist. Hamilton No. C-080533, 2009-
Ohio-2260, ¶ 14, citing City of Galion v. Am. Fedn. of State, Cty. & Mun. Emp., Ohio
Council 8, AFL-CIO, Local No. 2243, 71 Ohio St.3d 620, 646 N.E.2d 813 (1995),
paragraph two of the syllabus.
{¶39} Importantly, R.C. Chapter 2711 distinguishes between vacatur and
modification of arbitration awards. R.C. 2711.10 allows a trial court to vacate an
arbitration award if “[t]he arbitrators exceeded their powers, or so imperfectly
executed them that a mutual, final, and definite award upon the subject matter
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submitted was not made.” R.C. 2711.10(D). Arbitrators do not exceed their powers so
long as the award “draws its essence” from the parties’ arbitration agreement. See
Ohio Office of Collective Bargaining v. Ohio Civ. Serv. Emps. Assn., Local 11, 59 Ohio
St.3d 177, 184, 572 N.E.2d 71 (1991); Bd. of Trustees of Anderson Twp. v. Anderson
Twp. Professional Firefighters Assn., IAFF Local 3111, 1st Dist. Hamilton No. C-
180371, 2019-Ohio-2302, ¶ 10-11.
{¶40} By contrast, under R.C. 2711.11, a trial court “shall” modify or correct an
arbitration award if:
(A) There was an evident material miscalculation of figures or an
evident material mistake in the description of any person, thing, or
property referred to in the award;
(B) The arbitrators have awarded upon a matter not submitted to them,
unless it is a matter not affecting the merits of the decision upon the
matters submitted; [or]
(C) The award is imperfect in matter of form not affecting the merits of
the controversy.
{¶41} After the panel awarded Mr. Harris the full costs of arbitration,
Defendants filed a “Motion to Modify Arbitration Award,” arguing that the panel’s
costs award did not “draw its essence” from the parties’ November 2021 Arbitration
Agreement and that it thus should be modified under R.C. 2711.11(C) to reflect the
parties’ agreement to split the costs 50/50. On reply below, they pivoted to a request
to modify under R.C. 2711.11 or to partially vacate under R.C. 2711.10. The trial court
denied their motion, correctly observing that Ohio courts apply the “draw its essence”
test only in the context of vacating arbitration awards under R.C. 2711.10, not with
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respect to modifying them under R.C. 2711.11. It nonetheless considered both the
request to modify and the request to vacate, denying them because the award
conformed to the Preliminary Conference Order, which it determined controlled the
proceedings instead of the Arbitration Agreement.
{¶42} On appeal, Defendants pursue the same approach. Perhaps in a
somewhat veiled effort to have us extend the “draw its essence” test to motions to
modify under R.C. 2711.11, they misconstrue prior holdings of Ohio courts that have
confined their analysis to vacatur under R.C. 2711.10 by suggesting those courts
permitted modification under the same analysis. See Cedar Fair, L.P. v. Falfas, 140
Ohio St.3d 447, 2014-Ohio-3943, 19 N.E.3d 893, ¶ 7-8 (confining its analysis to
vacatur under R.C. 2711.10 and not citing to R.C. 2711.11 or discussing modification);
Ohio Office of Collective Bargaining, 59 Ohio St.3d at 179, 572 N.E.2d 71 (same). But
the statutes operate in fundamentally different ways: “[u]nlike R.C. 2711.10, R.C.
2711.11 does not allow a reviewing court to modify an arbitration award for the reason
that the award violates the law.” Lake Cty. Bd. of Mental Retardation & Dev.
Disabilities v. Professional Assn. for the Teaching of the Mentally Retarded, 71 Ohio
St.3d 15, 20, 641 N.E.2d 180 (1994) (Wright, J., concurring). Indeed, R.C. 2711.11’s
grounds for modification are mechanical and clerical, including circumstances where
the arbitrator miscalculated figures, incorrectly described a certain property or
person, or otherwise erred “in matter of form,” rather than on the merits. R.C.
2711.11(A)-(C).
{¶43} Regardless of how the trial court framed and addressed the issues
below, we conclude that, for the purposes of their cross-appeal, Defendants only
preserved the argument that the trial court erred in denying their motion to modify
22 OHIO FIRST DISTRICT COURT OF APPEALS
the award of arbitration costs under R.C. 2711.11. On that issue, the trial court did not
err, because Defendants fail to show how the arbitrators miscalculated the cost award
or otherwise blundered in form, rather than in substance.
{¶44} Clearly, Defendants’ true concern is that the arbitrators relied on the
Preliminary Conference Order rather than the Arbitration Agreement. But that
argument speaks to the arbitrators’ substantive legal authority—namely, whether the
arbitrators “exceeded their powers,” R.C. 2711.10, which might constitute grounds for
vacatur, not for modification under R.C. 2711.11. Given Defendants’ failure to
properly raise the issue in terms of vacatur below and again on appeal, we decline to
address whether the trial court erred in confirming the costs award on the premise
that the arbitrators properly followed the conference order rather than the Arbitration
Agreement. We therefore overrule Defendants’ sole assignment of error in their cross-
appeal.
* * *
{¶45} In sum, we hold that the trial court erred in dismissing Mr. Harris’s
IWPCA claim because under Ohio’s conflict of laws rules, the parties’ choice of Ohio
law agreement cannot displace Illinois’s wage laws. We thus sustain his first
assignment of error, reverse the judgment of the trial court dismissing his IWPCA
claim, and remand the cause for further proceedings. We also hold that the trial court
did not err in splitting trial court costs 50/50 and overrule Mr. Harris’s assignment of
error on that issue. Finally, regarding the award of arbitration costs, we overrule Mr.
Harris’s third assignment of error regarding prejudgment interest, and we overrule
Defendants’ sole assignment of error regarding the award of arbitration costs to Mr.
23 OHIO FIRST DISTRICT COURT OF APPEALS
Harris taxed entirely against Defendants. We thus affirm the trial court’s judgment
confirming the arbitration award.
Judgments affirmed in part, reversed in part, and cause remanded.
BOCK, P.J., and ZAYAS, J., concur.
Please note:
The court has recorded its entry on the date of the release of this opinion.