Opinion ID: 3185489
Heading Depth: 2
Heading Rank: 4

Heading: sufficiency of the evidence

Text: The defendants’ remaining claims are best construed as challenges to the sufficiency of the evidence. It is well established that “a party is not entitled to challenge on appeal the sufficiency of the evidence to support the jury’s verdict on a given issue unless it has timely moved in the district court for judgment as a matter of law on that issue.” Kirsch v. Fleet St., Ltd., 148 F.3d 149, 164 (2d Cir. 1998). The defendants failed to do so here. Nonetheless, we may exercise our discretion to consider the issue if necessary to prevent “manifest injustice.” Fabri v. United Techs. Int’l, Inc., 387 F.3d 109, 119 (2d Cir. 2004). “[T]he circumstances normally ‘do not militate in favor of an exercise of discretion to address . . . new arguments on appeal’ where those arguments were ‘available to the [parties] below’ and they ‘proffer no reason for their failure to raise the arguments below.’” In re Nortel Networks Corp. Sec. Litig., 539 F.3d 129, 133 (2d Cir. 2008) (per curiam) (quoting Bogle-Assegai v. Connecticut, 470 F.3d 498, 504 (2d Cir. 2006)). The defendants argue that the evidence was insufficient to support the jury’s finding that Flannigan was an “employee” of Vulcan Amps at the time she earned her commission. To prevail on a claim under Section 191 of the New York Labor Law, “a plaintiff must first demonstrate that he or she is an employee entitled to its protections.” Lauria v. Heffernan, 607 F. Supp. 2d 403, 407 (E.D.N.Y. 2009) (quoting Bhanti v. Brookhaven Mem’l Hosp. Med. Ctr., Inc., 687 N.Y.S.2d 667, 669 (2d Dep’t 1999)). Here, the evidence showed that Flannigan became a full-time employee of Vulcan Amps during the same period in which the company was negotiating and closing the WGI deal. Therefore, the jury’s verdict is not manifestly unjust. Second, the defendants argue that the evidence was insufficient to impose personal liability on Graham either because he was not a party to the commission agreement, or because he was acting in his capacity as a corporate officer. However, the New York Labor Law permits 6 employees to sue individual corporate officers in their capacity as “employers” within the meaning of Section 190. See Chung v. New Silver Palace Rests., Inc., 272 F. Supp. 2d 314, 318 (S.D.N.Y. 2003); see also Cohen v. Finz & Finz, P.C., 16 N.Y.S.3d 70, 72 (2d Dep’t 2015) (holding that plaintiff stated claim against defendant “in his or her distinct capacity as the plaintiff’s employer within the meaning of the Labor Law”). Whether an individual qualifies as an employer depends on whether “the particular defendant had the power to hire and fire employees,” whether “he supervised and controlled the conditions of employment,” and whether “he determined rates and methods of payment, and the like.” Chung, 272 F. Supp. 2d at 318. Here, Graham admitted that he had the power to hire and fire Flannigan and the authority to supervise her. Flannigan also introduced testimony from a former Vulcan Amps officer that Graham “controlled the purse strings and controlled how [the company] operated on a day-to-day basis.” App. 251. In light of this evidence, the jury’s finding that Graham was Flannigan’s employer was not manifestly unjust. Third, the defendants argue that the evidence was insufficient to prove that Vulcan Power Group was Flannigan’s employer within the meaning of the Labor Laws, contending that she was in fact employed by Vulcan Amps.2 However, an entity may be a “joint employer” under the Labor Law, depending on “the circumstances of the whole activity, viewed in light of economic reality.” Zheng v. Liberty Apparel Co., 355 F.3d 61, 71 (2d Cir. 2003) (citation and quotation marks omitted) (discussing meaning of “joint employer” within meaning of the Fair Labor Standards Act (“FLSA”)); see also Chen v. Street Bear Sportswear, Inc., 364 F. Supp. 2d 269, 278 (E.D.N.Y. 2 The defendants also argue that the evidence was insufficient to prove that Vulcan Capital was Flannigan’s employer. However, the jury was not asked to make any finding about Vulcan Capital’s status as Flannigan’s employer, and the district court did not enter judgment against Vulcan Capital on the wage claim. Accordingly, we do not address this aspect of the defendants’ argument. 7 2005) (“[T]he New York Labor Law embodies the same standards for joint employment as the FLSA.”). Here, the evidence showed that Vulcan Power Group owned the Vulcan Amps Unit at the time Flannigan brokered the sale, and WGI tendered payment to Vulcan Power Group, not to Vulcan Amps. Moreover, Vulcan Amps and Vulcan Power Group operated out of the same office, shared at least one administrative employee, and were both controlled by Graham. Accordingly, the jury’s finding that Vulcan Power Group was Flannigan’s employer was not manifestly unjust. Fourth, the defendants argue that the evidence was insufficient for the jury to find that Flannigan earned the commission, because the commission agreement required her to sell two Amps units and she sold only one. Their argument is based on the October 7, 2003 email from Davis to Flannigan, which states: I wanted to confirm that should Vulcan AMPS or any of its affiliates be successful with its current initiative to sell the Washington Group International (“WGI”) AMPS units, the commission on the first two AMPS units to due to you will be 4% of the sales price of these AMPS units…. [T]o the extent we are successful in selling non-AMPS equipment to WGI, … we will pay an additional commission on those items under a different commission schedule. App. 619. The most reasonable reading of this email is that the 4% commission applies to the first two units, regardless of whether one or two are sold, and that a different rate would apply to any additional units sold. In addition, both Flannigan and O’Hare testified that the parties understood at the time that the 4% commission would apply regardless of whether one or two units were sold. Therefore, no manifest injustice occurred. Finally, the defendants challenge, again for the first time on appeal, the sufficiency of the evidence supporting various aspects of the damages award. The defendants contend that Flannigan’s compensatory damages on the wage claim should have been calculated as 4% of $14,481,000, which they contend was the true sale price of the Vulcan Amps Unit, rather than as 4% of the approximately $22 million that Vulcan Amps received from WGI. However, Vulcan 8 Amps ultimately retained the full $22 million as a lump sum pursuant to a settlement agreement with WGI. The record does not permit us to determine whether any portion of the $22 million was designated for some purpose other than purchase of the Vulcan Amps Unit. Under these circumstances, it was not manifestly unjust for the jury to calculate the commission based on the total payment that Vulcan Amps received from WGI as a result of Flannigan’s efforts. The defendants also challenge the jury’s award of compensatory and punitive damages on Flannigan’s retaliation claim. With respect to compensatory damages, they contend that Flannigan failed to present any evidence that the allegedly retaliatory counterclaims actually damaged her business. However, Flannigan testified that the subpoenas caused her clients to “ask[] what is this all about,” which “did affect [her] business” and “painted [her] out to look like a bad person.” App. 325–26. In addition, she testified that she had to “go in and explain [herself]” to her clients, who wanted to know why she “was involved in this litigation” and asked her “why is this Vulcan disrupting our business.” App. 387. She testified that this was “awkward,” “upsetting,” and “very damaging.” App. 387. It was not manifestly unjust for the jury to infer that Flannigan’s business suffered as a result of the defendants’ retaliatory actions. With respect to punitive damages, the defendants argue that the jury’s award of $900,000 was grossly excessive. Under New York law, “the standard for conduct warranting an award of punitive damages ‘has been variously described but, essentially, it is conduct having a high degree of moral culpability which manifests a conscious disregard of the rights of others or conduct so reckless as to amount to such disregard.” In re Methyl Tertiary Butyl Ether (“MTBE”) Prods. Liab. Litig., 725 F.3d 65, 127 (2d Cir. 2013) (quoting Home Ins. Co. v. Am. Home Prods. Corp., 550 N.E.2d 930, 934 (N.Y. 1990)). Courts have a duty “to keep a verdict for punitive damages within reasonable bounds considering the purpose to be achieved as well as the mala fides of the 9 defendant in the particular case.” Nellis v. Miller, 477 N.Y.S.2d 72, 74 (4th Dep’t 1984) (quoting Faulk v. Aware, Inc., 244 N.Y.S.2d 259, 266 (1st Dep’t 1963)) (reducing punitive damages award from $100,000 to $15,000). In this case, the defendants’ egregious conduct and malicious abuse of the judicial process fully supported the jury’s award of punitive damages. We have considered all of the defendants’ remaining arguments and find them to be without merit. Accordingly, we AFFIRM the judgment of the district court. FOR THE COURT: Catherine O’Hagan Wolfe, Clerk 10