Court Opinion

ID: 4258170
Source: CourtListenerOpinion
Date Created: 2018-03-26 15:10:20.66604+00
Date Added: 2024-06-11T12:25:35.457921
License: Public Domain

MEMORANDUM DECISION
      Pursuant to Ind. Appellate Rule 65(D),                                      FILED
      this Memorandum Decision shall not be
      regarded as precedent or cited before any                               Mar 26 2018, 8:56 am

      court except for the purpose of establishing                                CLERK
                                                                              Indiana Supreme Court
      the defense of res judicata, collateral                                    Court of Appeals
                                                                                   and Tax Court
      estoppel, or the law of the case.

      ATTORNEYS FOR APPELLANT                                  ATTORNEYS FOR APPELLEE
      Christopher J. Spataro                                   Andrew W. Hull
      Elizabeth A. Klesmith                                    Evan D. Carr
      Tuesley Hall Konopa LLP                                  Hoover Hull Turner LLP
      South Bend, Indiana                                      Indianapolis, Indiana

                                                 IN THE
          COURT OF APPEALS OF INDIANA

      Aaron Coates,                                            March 26, 2018
      Appellant-Defendant,                                     Court of Appeals Case No.
                                                               49A04-1710-PL-2464
              v.                                               Appeal from the Marion Superior
                                                               Court
      Valeo Financial Advisors, LLC,                           The Honorable Heather A. Welch,
      Appellee-Plaintiff.                                      Special Judge
                                                               Trial Court Cause No.
                                                               49D01-1505-PL-15418

      Najam, Judge.

                                       Statement of the Case
[1]   Aaron Coates appeals the trial court’s entry of summary judgment in favor of

      Valeo Financial Advisors, LLC (“Valeo”) on Valeo’s complaint alleging breach

      Court of Appeals of Indiana | Memorandum Decision 49A04-1710-PL-2464 | March 26, 2018           Page 1 of 7
      of contract, breach of fiduciary duty, and account stated. Coates presents a

      single issue for our review, namely, whether the trial court erred when it

      entered summary judgment in favor of Valeo. We affirm.

                                 Facts and Procedural History
[2]   On September 15, 2009, Coates began employment as a financial planner with

      Valeo, a financial advisory firm, and Coates signed an employment agreement

      (“the agreement”). The agreement provided in relevant part as follows:

              10. Covenants Against Solicitation and Interference

              (a) Non-Solicitation. During the Restricted Period (as defined
              below), Employee will not, directly or indirectly, (i) solicit, either
              for himself or on behalf of others, any of the Company’s Clients
              or prospective Clients; . . . (iii) divert or attempt to divert any
              business of the Company to a Competitor; (iv) interfere in any
              manner with the business or operations then being conducted by
              the Company. . . .

              (b) Definitions. For purposes of this Section 10 . . . the following
              terms have the following meanings:

                      (i) Restricted Period. “Restricted Period” means the
                      period of time during Employee’s employment with
                      the Company and a period of twenty-four (24)
                      months from the effective date of termination of his
                      employment with the Company. In the event of a
                      breach of this Agreement by Employee, the
                      Restricted Period will be extended automatically by
                      the period of the breach.

                                                      ***

      Court of Appeals of Indiana | Memorandum Decision 49A04-1710-PL-2464 | March 26, 2018   Page 2 of 7
                      (iv) Clients. “Clients” means any person or entity for
                      whom the Company performed services for within
                      the preceding twenty-four (24) month period with or
                      without direct remuneration to the Company . . . .

                                                      ***

                12. Clients.

                                                       ***

                (b) Employee Lead Service Clients. In the event of Employee’s
                termination of employment with the Company, Employee may
                remove certain Employee Lead Service Clients from the
                Restrictive Covenants. To remove an Employee Lead Service
                Client from the Restrictive Covenants, Employee must pay a
                “removal fee” to the Company calculated as of the effective date
                of Employee’s termination. . . .

      Appellant’s App. Vol. II at 63-65. In 2010, Valeo distributed to employees an

      updated version of the agreement, which included no substantive changes to its

      terms.

[3]   Near the end of December 2014, Coates terminated his employment with

      Valeo. And on December 29, Coates “delivered to Valeo” letters from six of

      Valeo’s clients stating that each of them “wish[ed] to terminate [the client’s]

      advisory relationship with Valeo . . . effective 12/29/2014.” Id. at 129. All six

      clients were “subject to the removal fee” provision of the agreement. Id. at 24.

      Accordingly, on January 15, 2015, Valeo sent Coates an account reconciliation

      setting out the removal fee Coates owed Valeo for each client. The aggregate

      Court of Appeals of Indiana | Memorandum Decision 49A04-1710-PL-2464 | March 26, 2018   Page 3 of 7
      amount of the six removal fees was $37,476.96. Coates did not pay Valeo, but

      he also did not expressly object to the stated amount of the removal fees.

[4]   On May 8, Valeo filed a complaint against Coates alleging breach of contract,

      breach of fiduciary duty, and an account stated claim. Coates timely filed his

      answer. On May 1, 2017, Valeo moved for summary judgment on all three

      claims, and Coates, pro se, filed a memorandum in opposition to summary

      judgment. In his memorandum, Coates made two contentions: that a question

      of fact exists regarding whether he was an employee or independent contractor;

      and that “[s]ummary judgment is inappropriate in any matter where each party

      contends the other party breached a contract.” Appellant’s App. Vol. II at 238.

      Following a hearing, the trial court entered summary judgment in favor of

      Valeo. This appeal ensued.

                                     Discussion and Decision
[5]   Our standard of review for summary judgment appeals is well established:

              We review summary judgment de novo, applying the same
              standard as the trial court: “Drawing all reasonable inferences in
              favor of . . . the non-moving parties, summary judgment is
              appropriate ‘if the designated evidentiary matter shows that there
              is no genuine issue as to any material fact and that the moving
              party is entitled to judgment as a matter of law.’” Williams v.
              Tharp, 914 N.E.2d 756, 761 (Ind. 2009) (quoting T.R. 56(C)). “A
              fact is ‘material’ if its resolution would affect the outcome of the
              case, and an issue is ‘genuine’ if a trier of fact is required to
              resolve the parties’ differing accounts of the truth, or if the
              undisputed material facts support conflicting reasonable
              inferences.” Id. (internal citations omitted).

      Court of Appeals of Indiana | Memorandum Decision 49A04-1710-PL-2464 | March 26, 2018   Page 4 of 7
              The initial burden is on the summary-judgment movant to
              “demonstrate[] the absence of any genuine issue of fact as to a
              determinative issue,” at which point the burden shifts to the non-
              movant to “come forward with contrary evidence” showing an
              issue for the trier of fact. Id. at 761-62 (internal quotation marks
              and substitution omitted). And “[a]lthough the non-moving
              party has the burden on appeal of persuading us that the grant of
              summary judgment was erroneous, we carefully assess the trial
              court’s decision to ensure that he was not improperly denied his
              day in court.” McSwane v. Bloomington Hosp. & Healthcare Sys.,
              916 N.E.2d 906, 909-10 (Ind. 2009) (internal quotation marks
              omitted).

      Hughley v. State, 15 N.E.3d 1000, 1003 (Ind. 2014) (alterations original to

      Hughley). We may affirm an entry of summary judgment on any theory

      supported by the designated evidence. Alva Elec., Inc. v. Evansville-Vanderburgh

      Sch. Corp., 7 N.E.3d 263, 267 (Ind. 2014).

[6]   It is well settled that issues not raised before the trial court on summary

      judgment cannot be argued for the first time on appeal and are waived.

      Dunaway v. Allstate Ins. Co., 813 N.E.2d 376, 387 (Ind. Ct. App. 2004). Here, in

      his memorandum in opposition to summary judgment, Coates’ argument

      consisted of the following two contentions: that summary judgment is

      “inappropriate when a fact specific question of an employee or independent

      contractor relationship exists that weighs on claims of statutory relief”; and that

      “[s]ummary judgment is inappropriate in any matter where each party contends

      the other party breached a contract.” Appellant’s App. Vol. II at 238. And

      Coates concluded his memorandum as follows:

      Court of Appeals of Indiana | Memorandum Decision 49A04-1710-PL-2464 | March 26, 2018   Page 5 of 7
               All Counts of Valeo’s Complaint and Motion turn on the
               existence of a valid contract, and Coates’ performance
               thereunder. Therefore, in light of clear case precedent,
               Defendant Coates is confident that Plaintiff’s Motion for
               Summary Judgment is not appropriate for all three Counts, and
               therefore sees no justification in further burdening the Court by
               addressing each of Valeo’s claims in its Motion.

      Id. at 239.

[7]   On appeal, Coates abandons the arguments he made to the trial court and

      asserts entirely new arguments, including his contention that genuine issues of

      material fact exist to preclude summary judgment on each of Valeo’s claims.1

      Coates’ primary contention on appeal is that the trial court “had sufficient

      designated evidence at its disposal to deny Plaintiff’s Motion for Summary

      Judgment.”2 Appellant’s Br. at 20. But because Coates’ appeal rests on

      arguments he did not make to the trial court and because he did not direct the

      trial court to the designated evidence he now asserts establishes genuine issues

      of material fact, he has waived his arguments on appeal. See Dunaway, 813

      1
        For instance, Coates contends for the first time on appeal that the agreement is void. We reject Coates’
      assertion that he argued this issue in his memorandum in opposition to summary judgment. While Coates
      quoted from his answer regarding his contention that he was not an “employee,” nothing in his
      memorandum in opposition to summary judgment resembles a cogent argument on the issue of whether the
      agreement is void.
      2
         Coates relies heavily on the fact that he designated his answer as evidence in opposition to summary
      judgment. But it is well settled that, once a summary judgment movant designates evidence to establish a
      prima facie case, the non-movant “may not rest upon the mere allegations or denials of his pleading.” T.R.
      56(E) (emphasis added). Rather, “his response, by affidavits or as otherwise provided in this rule, must set
      forth specific facts showing that there is a genuine issue for trial.” Id.; see also Hughley, 15 N.E.3d at 1004.
      Because Coates did not set forth specific facts to the trial court showing that there was a genuine issue for
      trial by any evidence other than his answer, he did not meet his burden under Trial Rule 56(E).

      Court of Appeals of Indiana | Memorandum Decision 49A04-1710-PL-2464 | March 26, 2018                  Page 6 of 7
N.E.2d at 387; see also McGill v. Ling, 801 N.E.2d 678, 688 (Ind. Ct. App. 2004)

      (rejecting summary judgment nonmovant’s argument that issue raised for first

      time on appeal not waived where there were “facts in the summary judgment

      record to support [her] argument”), trans. denied.

[8]   Waiver notwithstanding, we agree with the trial court that Valeo designated

      evidence to establish a prima facie case for breach of contract, breach of fiduciary

      duty, and account stated.3 At that point, the burden shifted to Coates to

      designate to the court each material issue of fact which he maintained

      precluded entry of summary judgment and the evidence relevant thereto. T.R.

      56(C). Coates did not satisfy his burden, and the trial court did not err when it

      entered summary judgment in favor of Valeo.

[9]   Affirmed.

      Mathias, J., and Barnes, J., concur.

      3
        Valeo’s designated evidence in support of summary judgment included the affidavit of Gregory Fulk, Chief
      Operating Officer of Valeo. In his affidavit, Fulk stated that Coates “solicited and diverted” each of the six
      Valeo clients in contravention of the agreement. Appellant’s App. Vol. II at 101. Coates made no objection
      to the admission of that affidavit to the trial court. Accordingly, to the extent Coates now contends that Fulk
      was without personal knowledge that Coates solicited or diverted the clients, he has waived that issue for our
      review. Paramo v. Edwards, 563 N.E.2d 595, 600 (Ind. 1990) (noting a complaining party has a duty to direct
      the trial court’s attention to a defective affidavit, and failure to raise an objection constitutes waiver).

      Court of Appeals of Indiana | Memorandum Decision 49A04-1710-PL-2464 | March 26, 2018               Page 7 of 7