new york's faithful servant doctrine is required that employees who breach those duties including by committing crimes forfeit all of their compensation earned during the period of wrongdoing even if those acts then affect their employers as they often do no court in one hundred fifty years since this doctrine began a more than one hundred fifty years has held what the district court held this is a bright line dissin title meant to compensation with this case because they have nothing to do with claims against one's own fiduciary and the decision is terrible consequences for holding for douceur is accountable because it's not uncommon that employees commit crimes which fur interests of their employer and employers have always had a need to have the ability to disincentive eyes that and hold them accountable for such conduct is i mean it seems to me that would you're trying to levi all because of the guilt of some employees and that those old boys were acting and weak to we asked the opportunity to prove at a trial that they were acting contrary to the wishes of the owner of the company for very very compelling reasons benefiting the corporation but that has never been a test under faithful servant you know for example in the mcconnell case which is cited your court of appeals case which is cited by sansom and tenet check those first department cases that the last couple years there was a case where an agent bribed a nother individual for the benefit of the company  a i understand the question correctly imputation as and has never been applied under new york common law or the restatement of agency to a situation in which the employee the employer or the principal state court seems to me it's on all fours you well i'm i'm not a call in that case your honor but if you look at brown versus prince ski which is a new york court of appeals case never overruled not commented on by the mr gifford here this is a case where two agents committed a wrongdoing which was negligent the the principal sued one of the agents for for that and the court of appeals very clearly never been overruled urban commented on for distinction is that for purposes of a suit by a principle against one of its agents one of its fiduciary is for wrongdoing the conduct of no agent is imputed to the principal not the agent being sued nor any other agent in the company and that's that's the principal that's the principal the restatement that's the principal brown and a servant at all but the real distinction is that the person there is only two operators committing the crime in that case that was the sole owner of the company and the person the company was suing that both bribe the individual they both did exactly the same thing and it was a act of rock was an act of wrongdoing by the sole owner of the company totally distinguishing from this situation here that it all the idea is both in that case and me mispronounced it and in this case it's the company that's profiting and the company and the employee at issue are both in buried elect of they're involved in wrongdoing it's you keep on telling me that in that trial in state court here that there were not in this case others were not convicted i don't understand the relevance of that the relevance is imputation only arises when a principal is going after a third party it defines the relationship between the principal and a third party it has no realm of events of whether in the not possibly bring a suit on behalf of the company because he had ratified what this employee had done which would have of cause favor servant to fail as well but if you isn't whether the sole owner ever being briefed that kirsner over rule two hundred years of new york employment law it didn't there are cases all these cases figler this court and fancy car they all have cases where th and an insurance broker who was his special agent to deal with insurance and i think you know where this is headed there was a fire it was an insurance plaintiff sues the special agent the special agent says well the acts of the general agent who was generally in charge of all your properties should be imputed to you when you should lose the negligence cl the court of appeals in new york held that the acts of the general agent would be imputed who was the special agent who had to deal with insurance brown vs peruzzi has absolutely in at least two other ways first the conviction of lawyer for thirteen felonies including nine counts of grand larceny and maintaining a corrupt enterprise and in addition to that the the complaint makes clear numerous employees of lir were involved in their acts or properly imputed i don't think this court has to get involved in imputation because i think the convictions establish we're lior layer is under the new york penal or lear could only be convicted of a crime in the state of new york if it was the conduct in question was what the royston were recklessly tolerated by the board of directors who are a hard time managerial agent acted within the scope of employing you have to leave executives who work convicted and again the complaint makes clear that the numerous other employees were involved i mean would you agree that there is at least some tension between parried elect our and the new york faithful applies in all circumstances in less the adverse interest exception applies and we know in example in employment more how do you square that with fire or is a case that held the employee was not loyal because all it had done was to take preparatory steps to open up a business so as a matter of new york substantive employment more they said the employee could not be liable for states that even if everything the employee does some of it is good some of it is he can still be he or she can still be loyal to being a faithless servant that of course assumes that the employer is not engaged in acts that would trigger an parried alect o the example that i think is fairly obvious is if an employee embezzles money where there's absolutely no benefit to the employer it would not be imputation and i think corn right over the commercial division in the most me a case where she said certain acts would be employed to the corporation against a director an officer and other acts where the sound for two reasons first they never submitted a proposed amended complaint they mentioned in passing that they would like to assert that but we now know based upon the convictions that lir beyond a reasonable doubt had its actions authorized either by the board oh boy a high managerial agent you can't plead leader cannot plead its way around thirteen felony convictions he simply cannot do it even assuming even assuming that they had really raised this and say here's a proposed pleading what are they going to say they're going to say well this officer knew this officer didn't it's all imputed to them and they were found guilty beyond a reasonable doubt one of the other things that was not mentioned by either the amicus white particularly by the make this is the notion that here the employer clearly count employer can't say gee i know what you're doing but i'm not going to do anything and what we have in the reply brief of the appellant is well there was no waiver there was no intentional relinquishment of a known right and that's really a mr rection because the test is not whether the employer intentionally waived his right to sue for disloyalty the test is this court has said at least twice is whether the employer countenance the conduct and in or brief we lay out the cases there has never been a case where an employer knew of the employee's conduct and then turned around and sued the employee for disloyalty and in this case there's even more because here as the complaint itself makes clear and as the criminal convictions make clear the employer did more than merely countenance the co they directed the conduct they benefited from the conduct as indicated by the knowing grand larceny convictions so different had two separate grounds for dismissal both of the courts below relied exclusively on new york and all these are set forth in detail in the brief in new york to be convicted of a crime a company doesn't have to have senior management or the board responsible any manager can fix the company of a crime number two we we had process wise this was a affirmative defense to a complaint there was no reply there was no other opportunity to put in another complaint and at that at the at the hearing on a motion to dismiss and in our brief we repeatedly asked for the right to amend and we laid out what we would say would say is that this contract was a by five or six employees all of which was disavowed by the board against the rules of the board against the policies of the company and concealed the foreman of the concealed from the company and we would prove that so and you don't have to file a minute complain a proposed minimum complaint to get an amendment on of the rules that he's talking about a waiver defense when you've had a job trying to prove a waiver defense he's talking about what was never proven in the record give us a chance to prove a waiver defense under fa both by samsung in ten a check it was a case where somebody bribed a vendor to get more business for the company benefiting the company that bribe would have been held against the company delivered the grounds wasn't raised but faithful servant denied that agent that employee any compensation for his bribe even though the bribe increased the business of the company if i file for financial statements from my employer to pump up the value of the stock and i commit a crime and i cause my importer be convicted of that crime under responding speer you're my employer still has a right against me otherwise we you are you are removing all unsent