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National Waste Associates, LLC v. Scharf

Court of Appeals of Connecticut

July 31, 2018


          Argued January 31, 2018

         Procedural History

         Action to recover damages for, inter alia, breach of contract, and for other relief, brought to the Superior Court in the judicial district of Hartford and transferred to the Complex Litigation Docket, where the court, Dubay, J., granted the plaintiff's motion to cite in Omega Waste Management, Inc., as a party defendant; thereafter, the defendant Omega Waste Management, Inc., was defaulted for failure to appear; subsequently, the court, Devine, J., granted in part the motion for summary judgment filed by the named defendant et al.; thereafter, the matter was tried to the court, Moukawsher, J.; judgment in part for the defendants, from which the plaintiff appealed to this court. Affirmed.

          Richard F. Wareing, with whom were Anthony J. Natale and Angela M. Vickery, for the appellant (plaintiff).

          Douglas P. Needham, for the appellee (defendant Carl Slusarczyk).

          Jeffrey F. Allen, pro hac vice, with whom were Calvin K. Woo and, on the brief, Edward P. Hourihan, Jr., pro hac vice, and Mary P. Moore, pro hac vice, for the appellees (defendant Danielle Scharf et al.).

          Keller, Elgo and Bear, Js.


          ELGO, J.

         The plaintiff, National Waste Associates, LLC, appeals from the judgment of the trial court rendered, in part, in favor of the defendants, Danielle Scharf, Carl Slusarczyk, Waste Harmonics, LLC (Waste Harmonics), and Omega Waste Management, Inc. (Omega).[1] On appeal, the plaintiff claims that the court improperly concluded that (1) the plaintiff could not prevail on its unjust enrichment claims, (2) a nonsolicitation provision in agreements between the plaintiff and its former employees was unenforceable as to its prospective customers, and (3) General Statutes § 35-57 (a) bars its claims under the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq. We affirm the judgment of the trial court.

         The plaintiff commenced this action in August, 2012. The following facts, as found by the trial court or as stipulated to by the parties in their joint trial management report, are relevant to this appeal. The plaintiff, Waste Harmonics, and Omega are waste management brokers that provide waste removal and recycling services for their customers. Slusarczyk began working in the plaintiff's sales department in January, 2000.In2004, Slusarczyk signed a confidentiality and noncompetition agreement (2004 agreement) in which he agreed, inter alia, not to disclose confidential information or trade secrets of the plaintiff, not to solicit the plaintiff's customers for two years following the termination of his employment or during the pendency of any violation, and not to disparage the plaintiff. In February, 2010, the plaintiff terminated Slusarczyk's employment. Slusarczyk at that time signed a general release with the plaintiff, under which he agreed to abide by the terms of the 2004 agreement, and in return, the plaintiff paid Slusarczyk $50, 000.[2] At the time of Slusarczyk's departure, the plaintiff's client list included Guitar Center, Steak and Shake, Safelite, Daltile, and PetSmart.

         In 2011, Slusarczyk worked briefly for Omega. During that time, Slusarczyk solicited Guitar Center on behalf of Omega and repeatedly contacted Guitar Center, Steak and Shake, Safelite, and Daltile. Following the commencement of this action, Slusarczyk deleted e-mails and destroyed his computer. The court inferred from those actions that the e-mails contained disparaging comments about the plaintiff. In May, 2012, Slusarczyk began working for Waste Harmonics.

         Scharf was employed by the plaintiff from 2007 to 2011. Like Slusarczyk, Scharf signed a confidentiality and noncompetition agreement with the plaintiff. In June, 2012, Scharf was hired by Waste Harmonics.

         After its contract with the plaintiff expired on June 30, 2012, Guitar Center conducted a reverse auction to select its next waste broker. In the auction, the plaintiff's bid was the highest cost bid, while Waste Harmonics was the third lowest bid. In its May 9, 2016 memorandum of decision, the court found that Guitar Center ultimately awarded the contract to Waste Harmonics as a result of the professional relationship between Slusarczyk and a Guitar Center employee.

         As to the plaintiff's other former customers, the court found no credible evidence that Slusarczyk's solicitations resulted in the nonrenewal of their contracts with the plaintiff. More specifically, the court found that Safelite chose to hire haulers directly rather than use a waste broker. Waste Management, the largest waste broker, offered Daltile a deal on landfilling, which Daltile accepted. PetSmart did not renew its contract with the plaintiff, preferring nontraditional recycling services offered by Waste Management. As to Steak and Shake, the court found that the plaintiff offered no evidence as to why its contract was not renewed.

         Following the commencement of this action, the parties entered into a stipulated temporary injunction order on October 12, 2012, with respect to the allegedly improper use of certain confidential information and breach of contractual obligations by the defendants. On July 16, 2015, the plaintiff filed a fourth amended complaint that alleged breach of contract against Slusarczyk and Scharf; unjust enrichment against Waste Harmonics and Omega; tortious interference against Slusarczyk, Scharf, Waste Harmonics, and Omega; civil conspiracy against Slusarczyk and Omega; civil conspiracy against Slusarczyk, Scharf, and Waste Harmonics; violations of the Connecticut Uniform Trade Secrets Act (CUTSA), General Statutes § 35-50 et seq., against Slusarczyk, Scharf, and Waste Harmonics; and violations of CUTPA against Slusarczyk, Scharf, Waste Harmonics, and Omega. On August 28, 2015, Scharf, Slusarczyk, Waste Harmonics filed a motion for partial summary judgment, which the court granted in part on October, 29, 2015.

         A court trial was held over the course of eleven days in the spring of 2016. On May 9, 2016, the court issued its memorandum of decision. The court concluded that Slusarczyk breached his 2004 agreement with the plaintiff by soliciting its customers and by successfully securing the Guitar Center contract for Waste Harmonics. The court determined that the proper measure of damages for that breach was restitution of $50, 000, the amount of consideration that the plaintiff paid Slusarczyk in order to keep his promise under the agreement.[3]The court nonetheless concluded that Slusarczyk was not liable under any other theory alleged by the plaintiff. In addition, the court found that although Slusarczyk solicited Steak and Shake, Safelite, Daltile, and PetSmart, he not only was unsuccessful in those efforts, but played no role in the plaintiff's failure to retain them as customers. The court found that Slusarczyk did not use any of the plaintiff's confidential information to secure Murphy Oil and Pilot Travel as clients for Waste Harmonics, who also were prospective clients of the plaintiff. As the court noted in its memorandum of decision, the plaintiff's profit margins were high and uncompetitive. The court also determined that because the ‘‘objectively ...

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