Court Opinion

ID: 2721751
Source: CourtListenerOpinion
Date Created: 2014-08-28 17:04:54.797717+00
Date Added: 2024-06-11T15:46:45.390183
License: Public Domain

[Cite as Taddeo v. Bodanza, 2014-Ohio-3719.]

                Court of Appeals of Ohio
                              EIGHTH APPELLATE DISTRICT
                                 COUNTY OF CUYAHOGA

                             JOURNAL ENTRY AND OPINION
                                     No. 100704

                                     RAY J. TADDEO
                                                     PLAINTIFF-APPELLANT

                                               vs.

                      MICHAEL A. BODANZA, ET AL.
                                                     DEFENDANTS-APPELLEES

                                          JUDGMENT:
                                           AFFIRMED

                                     Civil Appeal from the
                            Cuyahoga County Court of Common Pleas
                                   Case No. CV-11-753685

        BEFORE: Rocco J., Boyle, A.J., and E.A. Gallagher, J.

        RELEASED AND JOURNALIZED: August 28, 2014
                                        -i-

ATTORNEYS FOR APPELLANT

Mary Davis
Gregory D. Seeley
Seeley, Savidge, Ebert & Gourash
26600 Detroit Road, 3rd Floor
Westlake, Ohio 44145

ATTORNEYS FOR APPELLEES

For Michael Bodanza, et al.

Karl E. May
Kadish Hinkel & Weibel
1360 East 9th Street
Suite 400
Cleveland, Ohio 44114

For O.N. Equity Sales Company, et al.

Kris Banvard
Marion H. Little
Zeiger, Tigges & Little L.L.P.
41 S. High Street
Suite 3500
Columbus, Ohio 43215
KENNETH A. ROCCO, J.:

        {¶1} Plaintiff-appellant Ray J. Taddeo, Jr., as executor of Ray J. Taddeo’s estate,

appeals from the trial court’s grant of summary judgment in favor of defendants-appellees

Michael Bodanza, Preferred Financial Services, Inc. (“PFS”), O.N. Equity Sales

Company (“ONESCO”), and John J. Takacs.1 For the reasons that follow, we affirm the

trial court’s final judgment.

        {¶2}    In January 2004, Taddeo opened two securities accounts with ONESCO,

through Bodanza, who at that time was a registered representative of ONESCO and the

sole owner of PFS. Takacs also did business in the PFS office under the PFS name and

was a registered representative of ONESCO.

        {¶3} In 2006, Bodanza advised ONESCO that he wanted to engage in private

securities transactions to raise capital for an oil and gas venture.               ONESCO advised

Bodanza that, under its rules, Bodanza could not participate in the private securities

transactions. Bodanza opted to resign from ONESCO and to surrender his securities

license so that he could pursue the private securities transactions.             Bodanza then began

marketing activities on behalf of Preferred Financial Holdings Co., L.L.C. (“PFH”), a

venture in oil and gas drilling.      Meanwhile, Takacs became the ONESCO supervisor for

PFS.

        1
          The underlying lawsuit was filed in 2011 by Ray J. Taddeo who died on May 21, 2012, while
the case was pending. Thereafter, Ray J. Taddeo, Jr., executor of plaintiff’s estate was substituted as
plaintiff. All references to Taddeo in this opinion are to the original plaintiff, the late Ray J. Taddeo.
       {¶4} In December 2007,         Taddeo met with Bodanza, and Bodanza informed

Taddeo that he had relinquished his securities license and that Taddeo’s accounts were

held by ONESCO as house accounts.            Bodanza asked Taddeo if he was interested in

PFH.       Taddeo was interested.     Taddeo asserts that Bodanza presented an offer to

purchase PFH “bonds.” But, in fact, Taddeo had purchased two promissory notes

from PFH in the total amount of $230,000.         Taddeo further alleged that Takacs came to

Taddeo’s house to obtain Taddeo’s signature on one of the promissory notes and to pick

up checks for the investment.

       {¶5} When the notes became due in October 2010, PFH could not pay them. On

April 21, 2011, Taddeo filed his initial complaint in the trial court setting forth several

causes of action within three broad categories: (1) as insurance agents (false and

fraudulent representation, negligent misrepresentation, breach of fiduciary duty, breach of

the duty to exercise reasonable care in advising client, common law fraud, negligent

supervision, unjust enrichment, and bad faith); (2) as securities registered representatives

(fraud by seller under R.C. 1707.41, advisor liability under R.C. 1707.42, sale of

unlicensed securities under R.C. 1707.43, conversion, negligent supervision, and unjust

enrichment); and as tax preparer (negligence).

       {¶6} Following discovery, the defendants filed four separate motions for summary

judgment on all of Taddeo’s claims.2 On November 5, 2013, the trial court entered

       Two of those motions were filed by defendants who are not parties to this appeal.
       2
summary judgment, followed by a nunc pro tunc entry on November 22, 2013, which

clarified that summary judgment was granted to all defendants on all claims.

      {¶7} Taddeo now appeals, asserting six assignments of error for our review:

      I. The trial court erred when it granted summary judgment to Bodanza when
      Bodanza sold unregistered securities, making him strictly liable for
      reimbursement to the purchasers thereof.

      II. The trial court erred when it granted summary judgment to ONESCO
      when there was an expert report that opined that ONESCO was liable for
      Bodanza’s actions.

      III. The trial court erred when it granted summary judgment to Takacs when
      Takacs participated in and aided the sale of the unregistered securities in
      Ohio by taking the documents for signature to the home of Taddeo, picking
      up the checks for investment and Takacs provided services to clients under
      the name PFS.

      IV. The trial court erred when it granted summary judgment to PFS when
      PFS participated in and aided the sale of unregistered securities as it was an
      umbrella organization under which business was conducted at the same
      address as PFH, and Taddeo was a client of PFS.

      V. The trial court erred when it granted summary judgment to ONESCO
      when ONESCO admittedly had authority over operations and publicity at
      PFS.

      VI. The trial court erred when it granted summary judgment to Bodanza and

      ONESCO on the tax claims when the evidence demonstrates that Bodanza

      led Taddeo to believe he was transferring funds from one retirement plan to

      another.

      {¶8} When reviewing an order granting summary judgment, we apply a de novo

standard, meaning we independently review the record to determine whether summary
judgment is warranted. Baiko v. Mays, 140 Ohio App. 3d 1, 10, 746 N.E.2d 618 (8th

Dist.2000).

       {¶9} Civ.R. 56(C) provides that summary judgment is appropriate if (1) there is no

genuine issue as to any material fact; (2) the moving party is entitled to judgment as a

matter of law; and (3) reasonable minds can come to but one conclusion, and that

conclusion is adverse to the party against whom the motion for summary judgment is

made, who is entitled to have the evidence construed most strongly in his favor.       Gilbert

v. Summit Cty., 104 Ohio St. 3d 660, 2004-Ohio-7108, 821 N.E.2d 564, ¶ 6.

       {¶10} The moving party carries the initial burden of setting forth specific facts that

demonstrate his or her entitlement to summary judgment. Dresher v. Burt, 75 Ohio St. 3d
280, 292-293, 662 N.E.2d 264 (1996). If the movant fails to meet this burden, the court

should not grant summary judgment. If the movant does meet its burden, summary

judgment is warranted only if the nonmovant fails to establish the existence of a genuine

issue of material fact. Id. at 293.

       {¶11} We address the first, third, fourth, fifth, and sixth assignments of error

together, because the analysis involved is the same. App.R. 16(A)(7) requires

       an argument containing the contentions of the appellant with respect to each
       assignment of error presented for review and the reasons in support of the
       contentions, with citations to the authorities, statutes, and parts of the record
       on which appellant relies.

We may disregard an assignment of error if an appellant fails to cite to any legal authority

in support of an argument as required by App.R. 16(A)(7). See App.R. 12(A)(2). We

may also disregard an assignment of error if an appellant fails to set forth an argument in
support of that assignment of error.          Roth v. Roth, 8th Dist. Cuyahoga No. 89141,

2008-Ohio-927, ¶ 71 (“[I]f an argument exists that can support [an] assignment of error, it

is not this court’s duty to root it out.”).

       {¶12} In his first assignment of error, Taddeo asserts that the trial court erred by

granting summary judgment to Bodanza when Bodanza sold unregistered securities,

making Bodanza strictly liable for reimbursement to the purchasers of those securities.

Taddeo has not cited to any legal authority nor to any portion of the record in support of

this assignment of error. Further, we are unable to discern what Taddeo is arguing

because he does not link his assignment of error to any cause of action that he asserted in

his complaint.     Accordingly, we overrule the assignment of error.

       {¶13} In his third assignment of error, Taddeo argues that the trial court erred in

granting summary judgment to Takacs when Takacs participated in and aided the sale of

the unregistered securities in Ohio by taking the documents for signature to the home of

Taddeo, picking up the checks for investment and Takacs provided services to clients

under the name PFS. Assuming that Takacs did everything alleged by Taddeo, Taddeo

fails to explain how Takacs’s actions form the basis of a viable legal claim. Taddeo does

not even identify a cause of action. Because Taddeo fails to make a legal argument

supported with citation to legal authority, we overrule the third assignment of error.

       {¶14} Taddeo’s fourth assignment of error contains the same fatal flaw. Here

Taddeo argues that the trial court erred in granting summary judgment to PFS when PFS

participated in and aided the sale of unregistered securities. Taddeo asserts that PFS
business was conducted at the same address as PFH, and that Taddeo was a PFS client.

Taddeo fails to cite to any legal authority to support his conclusory contention that these

facts form the basis of a viable legal claim.       Accordingly, we overrule the fourth

assignment of error.

       {¶15} In his fifth assignment of error, Taddeo argues that the trial court erred in

granting summary judgment to ONESCO when ONESCO had authority over operations

and publicity at PFS. Once again, Taddeo’s six-line “argument” fails to cite to a single

legal authority. We overrule the fifth assignment of error.

       {¶16} Taddeo’s sixth assignment of error asserts that the trial court erred in

granting summary judgment to Bodanza and ONESCO on the tax claims when the

evidence demonstrates that Bodanza led Taddeo to believe that he was transferring funds

from one retirement plan to another. This assignment of error is unsupported by any

argument or citation to legal authority. The sixth assignment of error is overruled.

       {¶17} In his second assignment of error, Taddeo argues that the trial court erred

by granting summary judgment to ONESCO, because Taddeo included an expert report in

his motion opposing summary judgment that opined that ONESCO was liable for

Bodanza’s actions. According to Taddeo, the expert’s report creates a genuine issue of

material fact as to ONESCO’s liability.

       {¶18} Taddeo argues that ONESCO is liable for Bodanza’s actions under the

theory of respondeat superior, but Taddeo has failed to set forth any argument
establishing Bodanza’s liability.3 Respondeat superior is a form of vicarious liability.

Natl. Union Fire Ins. Co. v. Wuerth, 122 Ohio St. 3d 594, 2009-Ohio-3601, 913 N.E.2d
939, ¶ 20. A principal is vicariously liable for the acts of his agent only when the agent

is directly liable. Id. at ¶22. Because Taddeo has failed to establish that there is a

genuine issue of material fact as to Bodanza’s liability as the agent, it follows that

summary judgment must also be granted to ONESCO as the principal. Accordingly, we

overrule the second assignment of error.

      {¶19} Judgment affirmed.

      It is ordered that appellees recover from appellant costs herein taxed.

      The court finds there were reasonable grounds for this appeal.

      It is ordered that a special mandate be sent to said court to carry this judgment into

execution.

      A certified copy of this entry shall constitute the mandate pursuant to

Rule 27 of the Rules of Appellate Procedure.

__________________________________________
KENNETH A. ROCCO, JUDGE

MARY J. BOYLE, A.J., and
EILEEN A. GALLAGHER, J., CONCUR

      3
       See ¶ 12 supra.