RASH V. J.V. INTERMEDIATE, LTD.
498 F.3d 1201 (10th Cir. 2007)
NATURE OF THE CASE: Intermediate (D) appealed the district court's orders relating to (1) fiduciary duty, (2) fee forfeiture, and (3) the statute of frauds.
FACTS: J.V. Intermediate, Ltd. (Ds) are Texas-based companies which build, refurbish, expand and manage assets for industrial process plants worldwide. D hired Rash (P) to start and manage a Tulsa, Oklahoma division. P and D signed a 2-year employment agreement providing P a base salary of $125,000, a bonus of 20% of JVIC-Tulsa's net profits, and a termination bonus of 20% of the division's equity. P was to 'devote [his] full work time and efforts' to D. P continued to serve as manager until 2004, without any written contract extension. D claims that P actively participated in and owned at least four other businesses, none of which were ever disclosed to D. One was Total Industrial Plant Services, Inc. (TIPS), a scaffolding business. TIPS bid on projects for D. P as D's manager, often selected TIPS as a subcontractor. D paid over $1 million to TIPS. D eventually started its own scaffolding business and Ps division never used those services. P sued D for breach of contract and fraud. He claimed the company purposely understated the net profits and equity. D claimed that P (1) materially breached his employment agreement, (2) breached his duty of loyalty, and (3) breached his fiduciary duty. At trial, the court granted P's Rule 50 motion for a judgment as a matter of law on D's counterclaim for breach of fiduciary duty. The jury was therefore only instructed on one of D's counterclaims - the breach of the duty of loyalty. The jury granted P $444,933 in damages. D sought $143,000 in damages for its breach of the duty of loyalty claim and received $71,500 from the jury. D eventually filed this appeal. D argues that the district court erred in granting Rash's Rule 50 motion seeking judgment as a matter of law on D's breach of fiduciary duty counterclaim.
ISSUE:
RULE OF LAW:
HOLDING AND
DECISION:
LEGAL ANALYSIS:
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