Court Opinion

ID: 5393580
Source: CourtListenerOpinion
Date Created: 2022-01-08 10:03:26.796351+00
Date Added: 2024-06-11T08:30:19.948864
License: Public Domain

Breitel, J.
(concurring in part and dissenting in part). There is ample evidence to support the verdict of the jury. There was evidence that plaintiff corporation was despoiled of its lucrative advertising accounts by a scheme in which its employees participated in violation of their duties while still employed. In this they were guided and abetted by Burke. This consisted of encouraging plaintiff’s faithless employees when encouragement was essential, of participating in consultation on strategy and by pointed suggestions to plaintiff’s principal officer, director and stockholder that his continuance in the business would lose for plaintiff its most valuable advertising account. That Burke and at least one of the employees did not stand to profit personally from the diverted accounts is immaterial, provided there was knowing participation. It is neither a justification nor is it material that Burke may have had a motive to benefit his own company, the Manhattan Soap Company, if indeed the scheme was one to harm plaintiff. An outsider such as Burke, entering actively into breaches of fiduciary duty by employees, can, in the process, bring home to himself a liability. The behavior lapses of plaintiff’s principal stockholder and chairman, Jones, did not and could not justify the concerted leaving of employment, solicitation and diversion of accounts, by plaintiff’s employees or those who may have knowingly joined with them. The renunciation of accounts by Jones is of no conclusive significance if we credit, as apparently the jury did, that Jones was then in a position in which, as he described it, 11 a gun ” was being held to his head. The jury on the evidence in this case was free to find that defendants schemed to despoil a helpless victim. (Defendants, in effect, attempt to justify their actions by the fact that the victim’s helplessness was due to his own misbehavior.) Moreover, the jury was free to find, on the evidence adduced, that defendant employees, unable to make a deal with J ones to purchase the business out of future profits, decided to take matters into their own hands, and leave a shell of plaintiff’s enterprise, a corporation without accounts or employees, and even deficient in officers and directors. The jury fixed as the damages an amount that was supportable by evidence of loss to plaintiff. The amount the jury found also bears an interesting relation to other facts in the case. When Jones and his employees negotiated they fixed a price for the *630corporate stock, ownership of which of necessity would give control of the substantial cash assets of the corporation. The amount of the purchase price then being negotiated was in excess of the cash assets by approximately the amount found by the jury to have been the damages sustained by plaintiff in the loss of its accounts. Hence, defendants are required by this judgment to pay no more than they had been willing to pay, except that the time of payment has been altered by their wrongdoing and the consequences of the legal action that followed. This is not a legal point but one that goes to the justice of what the jury did and is suggestive of the wisdom that it exercised.
There is an element of sympathy for defendants in this case, and that stems from the misconduct of Jones, due to a personal failing, in the performance of his obligations to his employees and the customers of his corporation. That ground for sympathy might constitute a defense in law or morals, only if it were true, which it is not, that two wrongs can make a right. The judgment in favor of plaintiff should be affirmed in all respects.
Judgment modified so as to dismiss the complaint as to the defendants Burke and Hayes and, as so modified, affirmed. Settle order on notice.