Seminatore v. Climaco, Unpublished Decision (7-24-2003)

Ohio Court of Appeals·Decided July 24, 2003·No. No. 81568.·Unpublished

Opinion

JOURNAL ENTRY AND OPINION.
{¶ 1} Plaintiff-appellant, Kenneth F. Seminatore, appeals the decision of the Cuyahoga County Common Pleas Court that entered judgment against him following a jury's verdict in favor of defendants-appellees, Climaco, Climaco, Lefkowitz and Garofoli, Company, LPA, John R. Climaco, Michael L. Climaco, Paul S. Lefkowitz, Dennis R. Wilcox, John A. Peca and Anthony J. Garofoli, on appellant's claims for breach of fiduciary duty and promissory estoppel. For the reasons that follow, we affirm.

{¶ 2} The record reveals that appellant joined defendant-appellee, Climaco, Climaco, Lefkowitz and Garofoli, LPA ("CCLG") in 1976 and remained in its employ until he was terminated in April 1997. Sometime in 1983, appellant met Jack Burry, who, at the time, was president and CEO of Blue Cross and Blue Shield of Ohio ("BCBS"). Shortly thereafter, BCBS became a rather lucrative client of CCLG, requiring the establishment of a dedicated service unit within CCLG. That unit employed approximately half of the firm's 60 attorneys and generated nearly $1 million in fees per month. It was undisputed that appellant was the principal in charge of this unit.

{¶ 3} In September 1988, Burry, on behalf of BCBS, executed a document agreeing to pay appellant "$75,000 per month for 12 months" in order to "assure continuity of [appellant's] personal advice, counsel and advocacy" in the event the attorney-client relationship between appellant and BCBS terminated. The agreement was addressed to appellant at his home and provided that appellant could "direct payment to his current firm or otherwise, as you see fit." John Climaco, the founding principal of CCLG, testified that he was unaware of this agreement until approximately 1994 when a federal grand jury requested all of the firm's contracts with BCBS when the latter was under investigation. Although John Climaco testified that he and appellant discussed the document, John Climaco expressed no concern at the time because he knew that any fees generated by appellant would come to the firm.

{¶ 4} CCLG's representation of BCBS continued. Sometime in 1996, negotiations were under way for Columbia Healthcare to acquire BCBS. Appellant was involved in these negotiations. Suffice it to say that the proposed acquisition of BCBS by Columbia did not receive favorable attention either by the press or the public. One aspect in particular concerned a proposed $3.5 million payment to appellant if the sale was consummated. Appellant testified that he informed John Climaco that BCBS wanted to compensate appellant personally for his "marketing skills" in the form of a "bonus" valued at approximately $2 million. This "bonus" actually was in the form of a non-competition agreement and valued at $3.5 million. John Climaco testified that he was shocked when informed by appellant but, nonetheless, conferred with the other principals and the consensus was to advise appellant "to do what he thinks is right," although at the time they were unaware that appellant had understated the value by $1.5 million. Appellant testified that, in his opinion, it was unlikely that he would receive this money but that he intended to use this proposed agreement as a "bargaining chip." In other words, he was prepared to relinquish the non-competition agreement if necessary to conclude the sale.

{¶ 5} At the same time that these negotiations were taking place, appellant and CCLG were involved in defending criminal charges against them for violating the requirements for reporting honoraria. Both appellant and CCLG entered pleas of no contest and were fined accordingly. Anticipating media coverage, CCLG prepared a written statement to be given to the press and requested that appellant adhere to that statement. Appellant, nonetheless, included a statement to the effect that "sometimes, in the arena, even successful gladiators get cut."

{¶ 6} The BCBS/Columbia sale did not take place. On the contrary, a settlement agreement was reached on March 18, 1997 that not only had the effect of preventing the sale, but terminated the legal relationship between appellant and BCBS. Shortly thereafter, on March 27, 1997, appellant made a demand for the payment of funds under the September 1988 agreement and directed that payment be sent to his home address. Upon learning this the next day, John Climaco conferred with the remaining principals and the decision was made to place appellant on an immediate leave of absence. Moreover, the decision was made to remove appellant's name from the name of the firm, which was done that day. Appellant eventually was terminated from CCLG sometime in April 1997.

{¶ 7} Appellant thereafter filed1 a six-count complaint against CCLG in its corporate capacity2 and against individual principal shareholders of CCLG, defendants-appellees, John R. Climaco, Michael L. Climaco, Paul S. Lefkowitz, Dennis R. Wilcox, John A. Peca and Anthony J. Garofoli, alleging (1) breach of contract; (2) breach of fiduciary duty; (3) promissory estoppel; (4) fraud; (5) conversion; and (6) redemption of interest.3 The allegations stem from appellant's employment relationship with CCLG and the subsequent termination of that relationship.

{¶ 8} The case proceeded to trial in June 1999 on appellant's claims for breach of contract, breach of fiduciary duty and promissory estoppel. The trial court ultimately directed a verdict on all of appellant's claims against CCLG and the individually named defendants at varying times throughout the trial. On appeal to this court, the trial court's decision to direct a verdict was upheld as to appellant's breach of contract claim, but reversed and remanded for a new trial as to appellant's claims for breach of fiduciary duty and promissory estoppel. See Seminatore v. Climaco, Climaco, Lefkowitz Garofoli, Co., LPA (Dec. 7, 2000), Cuyahoga App. No. 76658, 2000 Ohio App. Lexis 5732. In particular, this court concluded that the trial court erred in excluding the testimony of Douglas Andrews, a former principal of CCLG, and that of Alan Duvall, appellant's expert on damages. It, therefore, reversed and remanded the case for a new trial. The Ohio Supreme Court declined jurisdiction to further review this decision. See Seminatore v.Climaco, Climaco, Lefkowitz Garofoli, Co., LPA (2001),91 Ohio St.3d 1513.

{¶ 9} Trial commenced for a second time in April 2002 and was limited to appellant's claims for breach of fiduciary duty and promissory estoppel as stated above. Appellant's theory of the case was that appellees terminated him without just cause and made promises, upon which he justifiably relied, that (1) he would remain employed by CCLG as long as he maintained his law license; and (2) he could not be terminated, nor his compensation modified, without his consent. Appellees, on the other hand, presented evidence demonstrating that (1) appellant was disloyal to CCLG and the individually named principals; (2) this disloyalty constituted just cause for appellant's termination; and (3) no such promises of continued employment were made as asserted by appellant.

{¶ 10} The jury eventually returned a verdict in favor of all appellees. Appellant is now before this court and assigns four errors for our review.

I. Jury Interrogatories
{¶ 11}

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