UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

CONTINENTAL VINEYARD LLC and

INDECK-PASO ROBLES LLC,

Plaintiffs,

v.

RANDY DZIERZAWSKI and VINIFERA WINE 

CO., LLC,

Defendants.

No. 12 C 3375

Judge Thomas M. Durkin

MEMORANDUM OPINION AND ORDER

On Plaintiffs’ motion for a new trial, the Court held the jury’s verdict that 

Dzierzawski is liable for unfair competition is: (1) inconsistent with the jury’s verdict 

that Dzierzawski is not liable for breach of fiduciary duty of loyalty; and (2) 

potentially inconsistent with the jury’s award of $0 damages for unfair competition.

See R. 287 (Cont’l Vineyard LLC v. Dzierzawski, 2018 WL 6527953 (N.D. Ill. Dec. 12, 

2018)) (the “December 12 opinion”). In that same motion, Plaintiffs’ also sought a 

bench verdict on equitable disgorgement.

With respect to the first holding, the Court reasoned that the injury element 

necessary for liability for unfair competition should also have been sufficient to find 

liability for breach of fiduciary duty of loyalty. The Court also held, however, that 

Plaintiffs had failed to preserve an argument for a new trial on the basis of this 

inconsistency, and that the waiver could be excused only if the inconsistency was “of 

such great magnitude that it probably changed the outcome of the trial.” R. 287 at 7
2

(quoting Lewis v. City of Chi. Police Dep’t, 590 F.3d 427, 434 (7th Cir. 2009)). The 

Court held further that whether the trial’s outcome was impacted depended on 

“whether there was sufficient evidence for the jury to have imposed damages for a 

breach of fiduciary duty that they did not consider for unfair competition.” R. 287 at 

8-9. 

With respect to the second holding, the Court reasoned that the evidence may 

have been such that it was impossible for the jury to find liability for unfair 

competition without finding damages. 

The Court determined that further briefing was required on these two issues

regarding consistency of the verdict, as well as whether disgorgement was

appropriate. The parties submitted briefs, which the Court has now considered. For 

the following reasons, the Plaintiffs’ motion for a new trial is denied but the Court 

finds for Plaintiffs on their claim for disgorgement.

I. Inconsistency between the Unfair Competition and Breach of 

Fiduciary Duty Verdicts 

A. Excuse

In the December 12 opinion, the Court noted that while “the jury was 

instructed to consider whether Plaintiffs lost profits due to Dzierzawski’s conduct”

when considering both unfair competition and breach of fiduciary duty, “only the 

instruction for breach of fiduciary duty instructed the jury to consider whether 

Dzierzawski was unjustly enriched by his breach.” R. 287 at 7-8. Since the instruction 

for unfair competition did not instruct the jury to consider whether Dzierzawski was 

unjustly enriched, the Court reasoned that the jury’s finding of liability on unfair 
3

competition but not breach of fiduciary duty resulted in the jury not considering 

unjust enrichment at all. For this reason, the Court held that the inconsistency in the 

verdicts “probably changed the outcome of the trial,” and Plaintiffs’ failure to raise 

this issue before the jury was discharged could be excused.

But the Court’s reasoning failed to account for the fact that Plaintiffs brought 

unjust enrichment as a stand-alone claim, and the jury issued a separate verdict in 

Defendants’ favor on unjust enrichment. Thus, even though the jury found for 

Defendants on the breach of fiduciary duty claim and did not reach the question of 

damages in assessing that claim, the jury nevertheless considered whether unjust 

enrichment occurred. 

The instructions for damages under breach of fiduciary duty of loyalty 

referenced unjust enrichment:

Another potential form of damages for a breach of fiduciary 

duty claim is disgorgement, which is measured by the 

unjust enrichment either Defendant received from either 

Plaintiff.

R. 263 at 34. The jury was also instructed on rendering a verdict on unjust 

enrichment:

Plaintiffs claim that Defendants Randy Dzierzawski and 

Vinifera Wine Co. LLC were unjustly enriched by their 

conduct. To succeed under this claim, Plaintiffs must prove 

the following: 

(1) either or both Defendants received a benefit from either 

or both Plaintiffs; and 

(2) under the circumstances, it would not be fair or 

equitable to either or both Plaintiffs for the Defendants to 

retain the benefit. 
4

If you find that Plaintiffs have proven the above two 

elements, then you must find for the Plaintiffs as to this 

claim. If you find that Plaintiffs have not proven the above 

two elements, then you must find for Defendants on this 

claim.

R. 263 at 31. The jury found for Defendants on the unjust enrichment claim, 

answering “no” to the verdict form questions “Have Plaintiffs proven that [Randy 

Dzierzawski or Vinifera Wine Co. were] unjustly enriched with respect to Continental

Vineyards, LLC and/or Indeck-Paso Robles, LLC?” R. 272 at 5, 9. 

There is no material difference (if any difference at all) between the jury’s 

consideration of the unjust enrichment instruction and the damages the jury would 

have considered if it had reached damages under the instruction for breach of 

fiduciary duty. Because the jury considered damages for unjust enrichment, its 

failure to consider damages for breach of fiduciary duty could not have “changed the 

outcome of the trial.” Thus, the Court was mistaken when it determined that there 

was a potential basis to excuse Plaintiffs’ failure to preserve the inconsistency 

argument. The jury’s verdict on unjust enrichment removes that potential excuse.

B. Waiver

Plaintiffs argue, however, that the Court erred in finding waiver in the first 

place because their post-trial motion under Rule 59 was sufficient to preserve the 

issue. The December 12 opinion sets forth the authority for the Court’s waiver 

finding. In sum, the Court relied on cases noting that the Seventh Circuit has not 

addressed whether an objection to an inconsistent general verdict must be raised 

before the jury is discharged. See R. 287 at 5 (citing Fox v. Hayes, 600 F.3d 819, 844 
5

(7th Cir. 2010); Pearson v. Welborn, 471 F.3d 732, 739 (7th Cir. 2006)). In Fox, the 

Seventh Circuit noted that other circuits subscribe to such a rule. 600 F.3d at 844 

(citing Kosmynka v. Polaris Indus., Inc., 462 F.3d 74, 83 (2d Cir. 2006); Oja v. 

Howmedica, Inc., 111 F.3d 782, 790 (10th Cir. 1997); Home Indem. Co. v. Lane Powell 

Moss & Miller, 43 F.3d 1322, 1331 (9th Cir. 1995)). Separately, the Seventh Circuit 

has acknowledged the benefits of such a rule in the context of inconsistency between 

a general liability verdict and special interrogatories. See Strauss v. Stratojac Corp., 

810 F.2d 679, 683-84 (7th Cir. 1987).

Plaintiffs attack the Court’s waiver finding by citing a number of cases decided 

prior to the more recent Seventh Circuit decisions cited above. Plaintiffs note that in

Gordon v. Degelmann, decided in 1994, the court stated, “There is no priority among 

inconsistent verdicts. If the problem is not caught before the jury disbands (and no 

one noticed this conflict until post-trial motions), the proper thing to do is to hold a 

new trial with respect to all affected parties.” 29 F.3d 295, 298-99 (7th Cir. 1994). But 

Gordon concerned inconsistency of verdicts among multiple defendants. Resolving 

the inconsistency in that case required either imposing liability on a defendant the 

jury absolved or relieving a defendant of liability the jury imposed. See id. at 298 

(“[T]he judge reasoned that the jury’s verdict in [the individual defendant’s] favor was 

conclusive in favor of the Village. You can’t have vicarious liability without primary 

liability. The district court did not explain why it started from the verdict absolving 

[the individual defendant]. Why not the other way ‘round? One could say that because 

the jury awarded damages against the Village, it must have meant to hold [the 
6

individual defendant] liable.”). There can be no doubt that such inconsistency impacts 

the outcome of the trial. As discussed, such serious inconsistency is not present here.

Plaintiffs also note that in Timm v. Progressive Steel Treating, decided in 1998, 

the court stated, “If inconsistency escapes notice until after the jury has disbanded, 

the proper thing to do is to hold a new trial.” Timm v. Progressive Steel Treating, Inc., 

137 F.3d 1008, 1010 (7th Cir. 1998). But in that case the court found that the verdict 

was not inconsistent, so waiver was not at issue. Niether was waiver at issue in 

another case Plaintiffs mention, American Casualty Co. v. B. Cianciolo, Inc., 987 F.2d 

1302 (7th Cir 1993).

Plaintiffs also cited Turyna v. Martam Construction, 83 F.3d 178 (7th Cir. 

1996). But that case, decided in 1996, concerned an unusual circumstance not present 

here. When the jury began deliberations, the district court judge warned the parties 

that they must be able to return to the courtroom within five minutes to receive the 

jury’s verdict. This order practically required the parties to remain in the courtroom 

while the jury deliberated. Rather than be tied to the courtroom, the parties waived 

their presence at the reading of the verdict. As a result, the Seventh Circuit noted, 

“no one with any incentive to take action was present” when the verdict was read. Id.

at 180. Hence, the parties had no true opportunity to object to the verdict’s 

inconsistency until post-trial motions. The district court found waiver, and the 

Seventh Circuit remanded. But the Seventh Circuit did not directly address the 

waiver issue, instead focusing on the impact of the inconsistency. And in any case, 

the circumstances of the waiver in Turyna—the absence of counsel for the reading of 
7

the verdict in response to the district court’s strict scheduling—are materially 

different from the circumstances present in this case.

None of the cases cited by Plaintiffs directly address whether it was 

appropriate for the Court to find waiver in this case. As discussed, more recent 

Seventh Circuit precedent suggests that a waiver finding is appropriate here. 

Plaintiffs contend that the recent precedent supporting the Court’s finding did not 

consider the older decisions which Plaintiffs cite. But while Fox (decided in 2010) and 

Pearson (decided in 2006) did not analyze the older decisions in detail, they cited a 

case that did, indicating that the court considered their reasoning. See Fox, 600 F.3d 

at 844, and Pearson, 471 F.3d at 739 (citing Carter v. Chi. Police Officers, 165 F.3d 

1071, 1079 (7th Cir. 1998) (citing Gordon and Timm)). Thus, the Court will not 

reconsider its reliance on Fox and Pearson in light of older and distinguishable

Seventh Circuit decisions.

Plaintiffs also argue that the Court’s waiver finding was in error because it 

was based on the Court’s perception that the inconsistency was a product of erroneous 

jury instructions. As the Court discussed in its December 12 opinion, circuit courts 

finding waiver of the inconsistency objection if it is not raised before the jury is 

discharged do so pursuant to an interpretation of Federal Rule of Civil Procedure 51 

governing jury instructions and preserving claims of error. R. 287 at 5 (citing 

Kosmynka, 462 F.3d at 83; Jarvis., 283 F.3d at 56; Oja, 111 F.3d at 790; Home Indem., 

43 F.3d at 1331). Here, Plaintiffs cite those cases to argue that here there was no 

“error in an instruction actually given,” but “the error was solely attributable to the 
8

jury’s failure to apply the instruction.” R. 292 at 7 (quoting Kosmynka, 462 F.3d at 

84-85 and citing Jarvis, 283 F.3d at 56).

Examination of the relevant circuit court decisions belies Plaintiffs’ analysis. 

The three most recent decisions—Kosmynka, Jarvis, and Oja—concerned products 

liability cases in which the juries were instructed to make findings on both negligence 

and strict liability claims. The juries found liability for negligence based on a product 

defect, but not strict products liability, creating an inconsistency because the product 

defect necessary to find negligence should also have been sufficient to find strict 

products liability. There was no contention in any of the cases that the juries 

misapplied the particular instructions. Rather, the courts held the instructions were 

erroneous because they did not prevent the juries from rendering inconsistent 

verdicts. 

That is precisely what happened here. There is no claim that either the 

instruction for breach of fiduciary duty or the instruction for unfair competition was 

inherently incorrect. And there is no contention that the jury failed to follow either 

instruction. Rather, correctly following correct instructions, the jury rendered an 

inconsistent verdict. But as the courts of appeals held in Kosmynka, Jarvis, and Oja, 

this constitutes an instructional error that is governed by Rule 51. The Court will not 

reconsider its waiver finding based on Plaintiffs’ disagreement with this analysis.

II. Potential Inconsistency between Finding of Liability for Unfair 

Competition with a Finding of $0 Damages

In addition to addressing inconsistency between the unfair competition and 

breach of fiduciary duty liability verdicts, in the December 12 opinion, the Court also 
9

held that the jury’s verdict of liability for unfair competition could be inconsistent 

with its finding of $0 damages if the evidence was such that no reasonable jury could 

find $0 damages. Damages available under unfair competition are: (1) lost profits and 

(2) expenses incurred. For purposes of this briefing, Plaintiffs concede that 

Defendants’ expert was a sufficient basis for the jury to find $0 damages for lost 

profits. See R. 292 at 19 (“Given the ‘no reasonable jury’ standard at issue in this 

briefing and the wide disparity of expert opinion on the issue of lost profits, and 

without waiving its right to recover lost profits at a new trial, Continental here does 

not focus on the evidence related to its lost profits.”).

As for expenses, Plaintiffs contend that Defendants’ expert’s report stated that 

the minimum amount of expenses Plaintiffs incurred due to Defendants’ conduct was 

$5,000, see R. 292 at 19 (quoting R. 226-8 at 41 (¶ 57)), and on that basis it was 

unreasonable for the jury to find $0 damages, see R. 292 at 21. But Defendants’ 

expert’s report is not as unequivocal on this issue as Plaintiffs contend. Defendants’ 

expert’s report noted damages would be decreased further by the benefit Plaintiffs 

received from Defendants’ work. See R. 226-8 at 41 (¶ 57) (“This range [of costs 

incurred by Plaintiffs] does not include an offset for benefits that Vinifera provided 

to Continental.”). The expert noted that Continental’s controller, Joseph Oskorep,

concluded in a memorandum written to Continental’s owner that Defendants’ work 

to “[e]stablish[] a relationship with the distributors and [secure] a license to sell in 

Michigan and Illinois has been very helpful to [Plaintiffs]. Also having a full line of 

product to give to a retailer such as Meijers [sic] was also helpful to establish a 
10

pipeline for [Plaintiffs’] wine.” R. 226-8 at 50 (¶ 84). At trial, Oskorep testified that 

Vinifera brokered sales of Continental wine in Illinois and Michigan, R. 268 at 45-46 

(1032-33), and that Continental’s winemaker, Christopher Cameron, told him that 

having a full product line, which was made possible by Vinifera, was helpful to 

Continental, id. at 66 (1053:13-19).

Testimony from a number of other witnesses provided further evidence that 

Dzierzawski’s production and promotion of Vinifera wines created opportunities for 

distribution and sale of Continental wines even though Continental did not have 

sample wine available. See, e.g., R. 267 at 196-97 (903-04) (Dzierzawski testimony). 

Consistent with Oskorep’s testimony, Dzierzawski testified that Vinifera paid 

Continental’s “compliance” fees in Illinois and Michigan, id. at 233 (940), and that 

Vinifera cleared $180,000 in sales for Continental, id. at 144 (851). Cameron also 

testified that Vinifera “cleared” sales for Continental. R. 268 at 222-24 (1209-11).

Additionally, Mark Esterman, the wine buyer for Meijer stores, testified that he never 

would have bought Continental wine if Vinifera wine hadn’t been successful. R. 268 

at 124-25 (1111-12). And Noel Orsborn, the sales agent Dzierzawski used, testified 

that Vinifera helped Continental’s wines break into the market. R. 269 at 131-32 

(1415-16).

This evidence does not directly place a dollar value on the benefits Vinifera 

provided to Continental. But Defendants’ expert stated that the costs Vinifera 

imposed on Continental could have been as little as $5,000. And some testimony 

indicated that Vinifera’s benefit to Continental could have been as much as $180,000 
11

in cleared sales. This evidence was sufficient for the jury to find that any costs 

Continental incurred due to Vinifera’s actions were off-set by the benefits Vinifera 

created for Continental. Thus, it was reasonable for the jury to find liability on unfair 

competition but $0 in damages. Therefore, the jury’s verdict was not necessarily 

inconsistent, and there is no basis for a new trial.

III. Disgorgement: Findings of Fact & Conclusions of Law

The jury found no damages for unfair competition and found for Defendants on 

unjust enrichment. And as discussed above, there was sufficient evidence in the 

record for the jury to render this verdict. But as the Court explained in a pretrial 

opinion, the jury’s verdict is merely advisory on the issue of equitable disgorgement, 

as it “is an equitable remedy to be imposed by the Court as opposed to a jury.” See R. 

214 at 2 (citing Client Funding Sols. Corp. v. Crim, 943 F. Supp. 2d 849, 855-56 (N.D. 

Ill. 2013) (citing Chauffeurs, Teamsters & Helpers, Local No. 391 v. Terry, 494 U.S. 

558, 570 (1990); Scanlan v. Eisenberg, 669 F.3d 838, 841 (7th Cir. 2012))). The Court 

made that decision with respect to the breach of fiduciary duty claim. But 

disgorgement is also available for unfair competition. See Restatement (Third) of 

Unfair Competition § 37 (1995) (“One who is liable to another for deceptive marketing 

. . . is liable for the net profits earned on profitable transactions resulting from the 

unlawful conduct[.]”); see also CFE Racing Prod., Inc. v. BMF Wheels, Inc., 2 F. Supp. 

3d 1029, 1032 (E.D. Mich. 2014) (“It has been said that ‘[c]ourts will ordinarily award 

injunctive relief once a party has been found liable for trademark infringement,’ even 

if the jury has found in favor of the plaintiff but awarded no damages.” (quoting
12

Ironclad, L.P. v. Poly–Am., Inc., 2000 WL 1400762, at *10 (N.D. Tex. July 28, 2000))).

Plaintiffs ask the Court to exercise its equitable powers to disgorge Defendants’ 

profits. Thus, the following are the Court’s findings of fact and conclusions of law on 

Plaintiffs’ claim for disgorgement as a remedy for Defendants’ liability for unfair 

competition, with the facts being found by a preponderance of the evidence.

According to the Restatement, disgorgement is an appropriate remedy for 

unfair competition when:

the actor engaged in the conduct with the intention of 

causing confusion or deception; and the award of profits is 

not prohibited by statute and is otherwise appropriate 

[based] upon a comparative appraisal of all the factors of 

the case, including the following primary factors:

(a) the degree or certainty that the actor benefited from the 

unlawful conduct;

(b) the relative adequacy to the plaintiff of other remedies, 

including an award of damages;

(c) the interests of the public in depriving the actor of 

unjust gains and discouraging unlawful conduct;

(d) the role of the actor in bringing about the infringement 

or deceptive marketing;

(e) any unreasonable delay by the plaintiff in bringing suit 

or otherwise asserting its rights; and

(f) any related misconduct on the part of the plaintiff.

Restatement (Third) of Unfair Competition § 37. The jury found Defendants intended 

to cause confusion or deception among the Continental and Vinifera brands. See R. 

263 at 29 (unfair competition jury instruction). The question is whether the Court 

should disgorge Defendants’ profits that are attributable to this confusion.

To determine whether any profits are attributable to the brand confusion 

Defendants caused, the Court must identify in what circumstances that confusion 

occurred. Defendants generated profit from: (1) selling wine that competed with 
13

Continental wine and (2) selling wine that did not compete with Continental wine. 

Dzierzawski initially formed Vinifera to meet Meijer’s demand for moscato and 

zinfandel wines. Continental did not produce either of these wines. Meijier’s wine 

buyer, Mark Esterman, was aware that Vinifera wines were not produced with grapes 

from the Continental vineyard because he knew from his visit to the Continental 

vineyard that Continental did not grow moscato or zinfandel grapes. See R. 268 at 

108-11 (1095-98); 136-37 (1123-24). For these reasons, it was impossible for Vinifera’s 

moscato and zinfandel brands to be confused with Continental. And since there was 

no confusion with respect to the moscato and zinfandel wines, it is not appropriate to 

order disgorgement of Vinifera’s profits from those wines.

But Vinifera also sold wine varietals that Continental produced and sold. In 

fact, Vinifera purchased from Continental some of the wine bottled and sold by 

Vinifera. Dzierzawski marketed all these wines together as wines coming from 

Continental’s vineyard. Since some Vinifera brands were sourced from Continental’s 

vineyards and others were not, Dzierzawski’s marketing of all Vinifera and 

Continental brands as being produced with wine from Continental’s vineyards likely 

created confusion among the brands. Vinifera’s profits on varietals which Continental 

grew and sold were based on this confusion.

However, once Dzierzawski resigned from Continental on February 27, 2012, 

he no longer marketed Vinifera wine as Continental wine. Any profits earned from 

sales of Vinifera brands created after Dzierzawski left Continental cannot be said to 

derive from confusion with Continental brands. Only the sales of the Vinifera brands
14

already produced with grapes from Continental vineyards could continue to cause 

confusion in the market.

These facts demonstrate a high degree of certainty that Defendants profited 

from confusion between Vinifera and Continental brands. No other factors counsel 

against ordering Defendants to disgorge those profits. Dzierzawski personally 

received at least $641,125.34 of those profits. See R. 279 at 14 (citing exhibits). The 

Court orders Defendants to disgorge the profits attributable to the brand confusion 

described above. The Court relies on Defendants’ expert’s report to determine the 

relevant revenues and on Plaintiffs’ expert’s report to determine the relevant costs 

and expenses for each time period at issue:

2011

Vinifera Total Sales Revenue = $1,236,384 (R. 226-8 at 90 (Ex. M-1))

Vinifera Sales Revenue of Wine 

Competing with Continental = $592,037 (R. 226-8 at 73 (Ex. G))1

Minus Production Costs = $412,439 (R. 187-2 at 50 (Attachment 7))2

Minus Expenses = $52,049 (R. 187-2 at 50 (Attachment 7))

Net Profits to Disgorge = $127,549

 1 For reasons discussed, the Court subtracted moscato and zinfandel wines to 

determine sales revenue from wine competing with Continental. See R. 226-8 at 73 

(Ex. G).

2 The Court took the total costs and expenses numbers from Plaintiffs’ expert report. 

See R. 187-2 at 50. Of course, only a portion of total costs and expenses were derived 

from wines that competed with Continental. To determine the appropriate portion, 

the Court determined what percentage of total sales revenue was competing sales

revenue, and applied that percentage to costs and expenses.
15

2012 (January 1 – February 27)

Vinifera Total Sales Revenue = $229,346 (R. 226-8 at 90 (Ex. M-1))

Vinifera Sales Revenue of Wine 

Competing with Continental = $154,234 (R. 226-8 at 73 (Ex. G)

Minus Production Costs = $107,958 (R. 187-2 at 50 (Attachment 7))

Minus Expenses = $9,426 (R. 187-2 at 50 (Attachment 7))

Net Profits to Disgorge = $36,850

2012 (February 28 – December 31)

Vinifera Total Sales Revenue = $2,179,622 (R. 226-8 at 90 (Ex. M-1))

Vinifera Sales Revenue of Wine 

Competing with Continental = $705,268 (R. 226-8 at 73 (Ex. G)

Minus Production Costs = $525,571 (R. 187-2 at 50 (Attachment 7))

Minus Expenses = $81,912 (R. 187-2 at 50 (Attachment 7))

Net Profits to Disgorge = $97,785

2013

Vinifera Total Sales Revenue = $2,101,329 (R. 226-8 at 90 (Ex. M-1))

Vinifera Sales Revenue of Wine 

Competing with Continental = $196,555 (R. 226-8 at 73 (Ex. G)

Minus Production Costs = $144,876 (R. 187-2 at 50 (Attachment 7))

Minus Expenses = $28,132 (R. 187-2 at 50 (Attachment 7))

Net Profits to Disgorge = $23,547

2014

Vinifera Total Sales Revenue = $2,172,876 (R. 226-8 at 90 (Ex. M-1))

Vinifera Sales Revenue of Wine 

Competing with Continental = $38,106 (R. 226-8 at 73 (Ex. G)

Minus Production Costs = $31,176 (R. 187-2 at 50 (Attachment 7))

Minus Expenses = $7,419 (R. 187-2 at 50 (Attachment 7))

Net Profits to Disgorge = -$4893

Grand Total = $285,731

 3 This negative total for 2014 shows that Defendants did not profit on these wines. It 

does not show that Plaintiffs owed money to Defendants. So the Court has not 

subtracted this amount from the grant total.
16

Conclusion

For the foregoing reasons, Plaintiffs’ motion for a new trial, R. 279, is denied. 

Additionally, the Court finds for Plaintiffs on their claim of disgorgement in the 

amount of $285,731. 

ENTERED:

______________________________

Honorable Thomas M. Durkin

United States District Judge

Dated: May 10, 2019