Connecticut Supreme Court and Appellate Court Cases and Briefs Online

There are three good online resources to get information on appellate court cases in Connecticut.  

The first resource is a new addition to the state judicial branch website.  The public now has access to the case and docket information regarding Supreme Court and Appellate cases.  Here is the link.   Previously, you could only access trial level cases.  This is a great addition to the website and will cut down on trips to the clerk’s office to check on the status of a case.

You can get download advanced release opinions from the Supreme Court and Appellate Court.  Here is the link.

You can also download copies of some briefs for cases assigned for argument before the Supreme Court.  Here is the link.  This website is maintained by the Appellate Advocacy Committee of the Connecticut Bar Association. Briefs are typically posted several months after being filed with the court.

Forensic Accounting in Connecticut Business Litigation

Forensic accountants are frequently necessary in business litigation.  This is my next installment of the "ask the experts" series.   Stephen Pedneault is an expert in forensic accounting.  He is the principal of Forsenic Accounting Services.  Here is my interview with Stephen.

Disclaimer:  I am not endorsing any experts that I feature on this blog or the opinions expressed.  I am posting these interviews to offer insights from the various professionals that get involved with business litigation cases.

What are the biggest issues you see now with respect to forensic accounting and business litigation?  Probably the biggest issue we face in every case regardless of the venue it’s in is the availability of records. We can pretty much figure out anything if we have records available, computerized records or paper records. The biggest challenge for us is getting access to them and actually getting the opposing side to produce them. That’s our biggest stumbling block in pretty much every engagement we do. 

If a business owner suspects fraud, how soon should they come to you or an attorney to deal with that issue? 

Well as soon as possible. We get a lot of calls from exactly the audience you described and one of the first things we have to ask them is you know do you have counsel, do you have an attorney that’s either representing you as a shareholder or a partner or a member, or does the LLC or the entity have counsel because before I hear too much of the story there’s no privilege between an accountant and a client. So I don’t want to hear too much, what I want to make sure is as early as possible, I want to be involved early, but I got to make sure that before I’m involved early on there’s an attorney involved so we can establish some attorney/client privilege and then we can get retained directly by counsel to be part of that privilege and then we can start talking about what are the issues and concerns. 

What can business owners do to stop or detect or prevent fraud amongst it’s employees?   When we’re talking employee embezzlement, there’s really only three things that are available. You can prevent certain things, you can detect certain things, and then you can insure against the things you didn’t prevent and detect. Certainly setting up the controls to prevent as much as possible, so employees not signing checks, having business owners involved in the signing of checks, not issuing credit cards and bank cards to employees, limiting what they have access and opportunity. That’s on the prevention side but you can’t prevent everything from occurring so on the detection side, starting with the basics, the owners looking at the bank statements every month, looking at the cancelled check images, looking online at the banking activity, looking at accounts receivable, knowing who owes what balances and are we getting paid, managing the cash flows. These are all important basic controls that over time probably start out as the owners are doing but then people get busy and they hire key people and they delegate the responsibilities and once again you know down the road that key employee, and it’s almost always the key employee that we depend on, has taken advantage of the situation and started either stealing the checks or paying themselves extra payroll or stealing the deposits.  

 What kinds of problems have you come across that have been created in terms of your investigations of fraud brought about by smartphones and portable devices?

Well there is two clear trends. One is that our evidence which was already computerized is now becoming wireless. The evidence meaning the transactions and also where the records are maintained. This whole concept of cloud computing, businesses are putting all their business records no longer on their servers, their putting it out on a server somewhere in the world. So they can access it anywhere on the internet. The problem is gaining access to that evidence is going to be a challenge because nobody really knows where it’s hosted. It could be hosted next door, it could be hosted in Nigeria. So getting access to the ultimate records of where the company’s accounting system is maintained is a challenge. Using cellular devices to do the banking there is no history on any laptop servers or computers, it’s all wireless. So the whole nature of gaining evidence is changing and becoming a huge challenge for us just to get access to it. 

What records do you look to get access to from an audit perspective and also what form of the records do you like to receive it in?

That answer depends on what the context is for the forensic accounting. Ultimately we want to see the underlying reliable records: bank statements, cancelled check images, deposit details, credit card statements. We like the general ledgers, we like the computerized records but they can all be manipulated so we like to get, we’d like to get the records but we’d like to be able to corroborate them to underlying source third party records that are ultimately reliable and whether we get them in computerized form, we get them in images, we get them in paper, it doesn’t really matter to us, we’re used to dealing with boxes and boxes of records.

No Contract, No Problem – Charter Oak Gets A Chance To Prove Its Case

 In a decision that will be officially release tomorrow (download)the Connecticut appellate court ordered a new trial in favor of Charter Oak Lending for the claims it brought against employees who defected to a competitor.   Unless there is a successful appeal to the Connecticut Supreme Court, this means Charter Oak will get a second chance to prove its claims against the key employees despite the lack of a written contract in place covering non-competition.   I originally posted about this case in November of 1999 when Charter Oak lost at the trial level.  The case result had generated media interest surrounding the claims because the damages and the lack of a contract governing the employment relationship. 

As I noted at the time, it is always better to have a written contract in place with employees to govern post termination conduct involving competition, solicitation, confidential information, and trade secrets. However, the lack of contract does not by itself leave a business without a remedy especially if the situation involves use of trade secrets or confidential information or the employees actively competing before departure.  

In Charter Oak, the trial court dismissed the claims finding that Charter Oak failed to make out a threshold case during the trial.  In other words, the case never reached the level of a final decision on the merits because the judge found that the basic elements of the claims were not met.  The basic claims were breach of fiduciary duty, misappropriation of trade secrets and unfair trade practices. 

The appellate court reversed the decision and found that facts existed to make out threshold claims for these causes of action.  Therefore, the trial court judge should have permitted the case to proceed to a final decision on the merits.  Significantly,  the appellate court deemed as sufficient Charter Oak’s claim that its client list was a trade secret entitled to protection under General Statutes 35-51 known as the Connecticut Uniform Trade Secrets Act (CUTSA).  The court stated:

to make out a prima facie case for a violation of CUTSA, the plaintiff was required to present sufficient evidence that, if believed, would prove that the information in its customer list had independent economic value and that the plaintiff made reasonable efforts to maintain its secrecy.

Here were some of the facts that the court found sufficient to afford trade secret protection to the client list:

  • access was limited
  • the computers were encrypted
  • the building was secured where the computers were stored
  • employees were not permitted to share the list
  • employees understood the list was private
  • the lists were not sold or disclosed to third parties
  • the list could not be obtained from any other single source
  • the list gave Charter a competitive advantage

In addition to the ruling on CUTSA, the appellate court reaffirmed some aspects of the law with respect to fiduciary obligations of agents or employees.  The court affirmed the duty of loyalty owed by an agent to his or her principal.  This duty applies regardless of a whether a contract exists.  In the business context, this duty forbids an employee from actively competing against an employer concerning the subject matter of the agency or from using confidential information against the employer in competition.

Whether Charter Oak prevails in the new trial remains unclear.  However, the lack of a contract or written agreement should not prevent Charter Oak from getting a final decision on the merits.

Navigating FINRA’s Mandatory Arbitration Requirement – An Overview

 

 Raymond & Bennett attorney Joseph Blyskal contributed the following post to this Blog.

 I recently read an article indicating that arbitration was the preferred forum for member companies of the Financial Industry Regulatory Authority, but with a caveat–that the only real reason it was preferred was as damage control for the industry. With only some exceptions, the Financial Industry Regulatory Authority (FINRA) requires arbitration of industry disputes, which simply means disputes amongst or between its members and associated persons. In addition, while nonmembers can compel members to arbitrate, nonmembers of FINRA cannot be compelled to arbitrate. Regardless of whether the motive is fiscal, public relations, or other, the mandatory arbitration requirement may be hard to get around. However, the presence of a good faith claim against nonmembers can create the option to litigate an industry dispute outside of arbitration.   

                                        

                                                           

FINRA members are defined as any entity: “who is registered or has applied for registration under the Rules of FINRA” or  “[a] sole proprietor, partner, officer, director, or branch manager of a member, or other natural person occupying a similar status or performing similar functions, or a natural person engaged in the investment banking or securities business who is directly or indirectly controlling or controlled by a member, whether or not any such person is registered or exempt from registration with FINRA.”FINRA Manual Rule 13100(r). Some examples include: Metlife Securities, Inc., Bernad L. Madoff (now obviously inactive), and ING Financial Markets, LLC.

There are only a few enumerated exceptions to the mandatory arbitration rule. Disputes arising out of the insurance business activities of a member that is also an insurance company, claims alleging employment discrimination in violation of a statute, class actions, shareholder derivative actions, and matters that are inappropriate for the forum in light of the “purposes of FINRA and the intent of the Code” are excluded. FINRA Manual Rule 13200-13205. Depending on the circumstances, these are easily applied.

Less easily applied are the two threshold requirements that trigger mandatory arbitration for a dispute–that the dispute arises from the (1) business activities of (2) members or associated persons.  These must be addressed before considering the application of the exceptions.

Whether a dispute arises from business activities is a factual inquiry. It is liberally construed, however. It includes claims for commissions earned, discharge from employment, and non-statutory discrimination claims. Generally, this is a threshold element.  

The more litigation-friendly element is the second—that the dispute is between members, a member and an associated persons, or associated persons. Whether an entity is a FINRA member is not usually debatable (there are formal registration requirements). However, whether an entity is an “associated person” is often subject to debate.  Courts often deny motions to compel arbitration where a factual showing is not made to support a finding of “associated person” as defined in the Code.

Cases where there are parent companies and subsidiaries involved in the dispute, or where there are employees or registered representatives as parties that are not FINRA members, or not employed by FINRA members, are breeding grounds for litigation over this second threshold provision.

Of course, in any case—whether the threshold elements are present or an exception applies—the general rule that those not party to an agreement to arbitrate cannot be compelled to do so applies to the FINRA arbitration provision. Thus, litigation is clearly a viable option where there is at least one entity involved that is not a FINRA member.

While difficult to get around the arbitration provisions of FINRA, it may be possible to do so. Litigants, both those prosecuting and defending claims, should identify and categorize all the disputants before making a determination that arbitration is indeed “mandatory”.

 

Computer Forensics In Business Litigation – Ask The Expert

Many business litigation cases require experts in various fields.  I am going to feature experts on this blog in an "ask the expert" series of interviews.  Disclaimer:  I am not endorsing any experts that I feature on this blog or the opinions expressed.  I am posting these interviews to offer my readers some insights from the various professionals that get involved with business litigation cases.

Monique Ferraro is an expert in computer forensics and the principal of Technology Forensics, LLC.  She is also an attorney. The following is my recent interview with Monique. 

Q: What issues do you see in business disputes involving computer forensics:

 

A: Mostly, we see parties seeking email and deleted email. Increasingly, lawyers are asking for email and all electronically stored information containing metadata in their discovery requests. When they don’t get what they asked for initially, or if the party is not able to produce the information on their own, they call us. We figure out the best way to obtain the information requested without disrupting the business process while maintaining the integrity of the potential evidence and providing a solid chain of custody.

As far as the types of cases, we see computer forensics being requested in every type of litigation, from contract disputes to debt collection, employment litigation and even motor vehicle accidents.

 

 

Q: Many people think that when they delete computers docs and emails, its deleted.  In laymans terms, what really happens to it?  Can it be recovered?

 

A: It’s important to remember that computers were designed by engineers, not lawyers. Lawyers are concerned with precision of language. If you say you deleted something, then you deleted something. It’s gone. Unrecoverable. Engineers think in terms of efficiency.

 

When computer systems were designed, the engineers who developed them figured it would be more efficient to simply mark the space where information is held as available for reuse rather than truly deleting the file. The process uses less energy and is more efficient than truly deleting the file.

So, when we hit the ‘delete’ key, information isn’t deleted.

 

What happens is that the computer software goes to the table that keeps track of all the files and where they’re located and makes a check mark indicating that the space where that file is kept can be used for something else. Next time the computer goes to save a file, it can save it to this newly open space. However, because the size of computer storage is so large now, the space left open by the ‘deleted’ file is rarely reused. The original file stays there, lying in storage but with the space marked as available until it is either overwritten or ‘wiped.’

 

‘Wiping’ refers to really deleting a computer file. To really delete a computer file by wiping, a process is used that both marks the space as available and overwrites the space. Usually, the space is overwritten several times in order to obliterate any data remaining.

 

Because deleted data isn’t really deleted in the true sense unless it is wiped, most of the time deleted files can be retrieved and fully restored. That is true for files that have been consciously saved as well as data that has not been saved is held in temporary storage, as with Internet data.

 

Q: What are you seeing in the courts in terms of road blocks to getting access to servers and hard drives?

 

A: Most of the time, courts have been quite willing to grant discovery of electronically stored information. It gets tricky when litigants ask for a specific file or folder on a network or a targeted hard drive. Parties resist requests that involve having the opposing party’s expert on site, which is what litigants often request when seeking a specific storage device, folder or file. Of course, few businesses welcome the opposing party coming in and accessing their systems and data.

 

The objections are usually based upon keeping their business and client data secure and confidential and preventing disruption of their business. If there haven’t been discovery abuses and the party is trustworthy, the court usually allows the business to hire its own expert. To validate the acquisition of potential evidence, there are several methods that can be used, from documenting the process in writing to videotaping it, that can minimize the intrusion into business information and keep business disruption to a minimum.

 

Q: How do attorneys get access to emails that are on ISP accounts like Comcast, or third party servers like Gmail?

 

Most ISPs require a subpoena or court order to release information. It depends on the service provider, the information you’re looking for and who you’re requesting the information about. It’s best practice to contact the legal department of the ISP and ask them what they need and how they want it in order to get the results you seek. It may be that you’re legally entitled to the information, but if you don’t request if in the form that the ISP wants you to ask it in and from the person they designate, you won’t get what you’re looking for. It’s important to bear in mind that quite a lot of Internet service provider information is held in storage for a limited amount of time and that by the time there’s a lawsuit pending, the information is long gone.

 

Q: What issues have you seen with forensics and social media sites like Facebook, MySpace and Twitter?

A: Usually, we’re asked to mine data from social media sites as part of the whole process of investigating a specific person or case. It’s often an adjunct to the larger inquiry that helps to establish that we have the right information or to identify someone a target is communicating with. Of course, in some cases, the use of the social media is an issue in a case, and gaining the posting history is the challenge for the forensic examiner.

 

Q: Is it a good idea to work with an attorney early in an investigation?

 

A: We prefer to contract with the attorney representing the business because that’s the best way to protect our work product from being discovered by the opposing party. Attorney-client privilege extends to us if the attorney contracts with us. That provides the business with the same sort of protection of confidential information that they enjoy in their relationship with their attorney.

Q: What can someone in a business dispute do to preserve critical ESI (electronically storied information) when they know they are going to be in a lawsuit

 

A: Every business will be involved in litigation at some point. As with all things, planning saves a lot of labor and expense. Every business today holds at least some electronically stored information- email, accounting information, transaction information. Businesses need to know what electronic data they have, who accesses it and where it’s stored. A big issue we see is that electronic data is being held on business-owned as well as personally owned resources such as smart phones and laptops. It’s essential for the business owners to know where their data are stored so that they can ensure its preservation and production in the event of litigation.

  

 

Q: What mistakes do people make before business disputes that end up hurting them after the case is in court?

 

A: By far the biggest mistake people make is deleting electronic records. The fundamentals of litigation have changed. Whereas it was once possible to shred documents (which was spoliation, but was harder to prove), electronic storage of data makes it very difficult to destroy information without leaving behind a trail of evidence documenting the destruction. 

 

Q: What if you do not control the servers, infrastructure, how can you save critical ESI for later use in a lawsuit:

 

A: If you don’t control the storage media, you need to have your attorney issue a letter that informs the other party of your intent to sue and tells them of their duty to preserve relevant data. It’s best if the party who doesn’t have access has a good understanding of where the data are maintained so that discovery requests can be crafted intelligently. Without knowing how the data are stored and where, it’s more difficult to know whether you’re getting all the information when the other party produces it.

 

The good news (sort of) is that if a party knowingly or intentionally destroys electronically stored information, there are pretty harsh sanctions and a separate cause of action available to the person harmed by the loss of data. The intentional destruction of potential evidence is called spoliation. It’s a fairly easy proposition for a digital forensics examiner to determine if spoliation of electronically stored information has occurred and document it. Armed with the proof that spoliation occurred, courts have ordered pretty severe sanctions that range from ordering an adverse inference about the evidence (meaning that the jury should assume that the evidence was damaging) to default judgments. Money damages have also been awarded, some going into millions of dollars. In Connecticut, spoliation of evidence is a separate civil cause of action for which damages can be awarded.

Business Lawsuit Roundup

New Connecticut business litigation decisions and lawsuits of interest for February 2011:

Appellate Decisions:

Schirmer v. Souza

The Appellate Court upheld an award in favor of the plaintiffs on claims of unjust enrichment concerning renovations to a residence on defendants’ property. In a somewhat strange set of facts, the plaintiffs loaned money to the occupants of a home thinking they had title when the defendants actually had title. The defendants sold the house after the renovations.  Plaintiffs expected  over $100,000 from the sale of home to cover the renovation costs and instead got nothing.  Plaintiffs sued an recovered   based on unjust enrichment. 

Gateway, Kelso and Co. v. West Hartford No. 1, LLC

The Appellate Court upheld denial of summary judgment holding that a court finding in a pre-judgment proceeding could not provide the basis for summary judgment.  Plaintiff moved for a prejudgment remedy and it was denied because the defendant raised a defense based on the plaintiff’s failure to be licensed.  The defendant then tried to use that same ruling to obtain a judgment in the case.   The trial court denied the motion finding that the earlier ruling was not sufficient.  The Appellate Court upheld the denial of summary judgment and agreed that the ruling in the prejudgment remedy proceeding could not be the basis of the summary judgment ruling.

Tzovolos v. Wiseman

The Appellate Court adopted the trial court’s findings in full in this case involving two complex commercial disputes over the ownership and security interests in restaurant equipment.  The plaintiffs alleged breach of a purchase and sale agreement and a promissory note related to the equipment. The most significant aspect of the decision is the trial court’s decision to hold the individual defendants liable for the corporate defendants.

Trial Decision:

Directory Assistants, Inc. v. Albano

This case was filed in the federal district court over breach of a non-compete agreement.  The parties reached a stipulated settlement requiring the defendant to either file for bankruptcy or pay plaintiff $66,000.00 by way of a stipulated judgment.  At the time of the settlement agreement, the defendant was not sure of his ability to file for bankruptcy.  After agreeing to settle, the defendant either changed his mind or was not able to file for bankruptcy.  The defendant then tried to back out of the settlement.  The trial court ruled in plaintiff’s favor following arguments on a motion to enforce the settlement agreement. The court ruled that a litigant cannot agree to a settlement and then change his mind after the fact.  The court entered judgment.

New Lawsuits:

Coach, Inc. v. Tropical Sun, LLC, et al

This is a trademark infringement action under the Lanham Act, and a copyright infringement act under the Copyright Act. The action is brought by  Coach , well known for its leather made products like handbags and wallets. Coach owns several trademarks in various classes for its goods dating back to 1963 for leather goods and wallets. Coach alleges that its trademark is famous.  Coach also alleges that many of the combinations or design elements on its products are "protected works" under the Copyright Act.  Coach alleges that the defendants are selling look a likes from a retail store in Connecticut. 

The lawsuit gives some insight as to how trademark owners can police their products.  In this case, Coach sent a private investigator into the store to purchase the fake Coach products.  The products were retailing for far less than Coach’s genuine products.

Jacqueline Millan v. AIG

This is a whistleblower lawsuit.  Ms. Millan alleges she was fired from AIG Financial Products after identifying irregularities in AIG stock trading. She alleges that she was employed as a compliance associate and reported the irregularities to her supervisor and then was "shut out of the investigation and subjected to intimidation."  She alleges she was fired shorty thereafter.  The complaint seeks recovery for retaliatory discharge under Sarbanes-Oxley Act and Connecticut’s whistleblower law (31-51q).  The irregularities related to AIG employee stock trades at time when AIG was considering bankruptcy.

Unjust Enrichment In Connecticut – The Catchall When You have No Contract

The Connecticut Appellate Court’s  recent decision in Schirmer v. Souza is a reminder that there are circumstances where you can still recover damages for non-payment of services even when you do not have a written contract.   In Schirmer, the Appellate Court upheld an award in favor of the plaintiffs on claims of unjust enrichment concerning renovations to a residence on the defendants’ property.

In a somewhat strange set of facts, the plaintiffs loaned their daughter and son-in-law money to renovate a home.  The plaintiffs believed that their daughter had title to the property when the son-in-law’s parents, the defendants, actually owned the property.  The son-in-law performed the renovations but went beyond the scope of the project and essentially built a new house.  The defendants then sold the house after the renovations.  Plaintiffs expected  over $100,000 from the sale of home to cover the renovation costs and instead got nothing.  Plaintiffs had no contract with the defendants, the owners of the newly constructed house.  Plaintiffs sued and recovered after trial based on a theory of unjust enrichment. 

Unjust enrichment is an equitable remedy.  It is a broad and flexible remedy when the right circumstances are present.  To recover, a plaintiff must prove:

  • The defendants were benefited
  • The defendants unjustly did not pay the plaintiffs for the benefits
  • The failure to pay was to the detriment of plaintiff
  • The plaintiff lacks an available remedy under a written contract

 As the court noted in this case, the question becomes "did the defendant, to the detriment of someone else, obtain something of value to which the defendant was not entitled?"  The equitable remedy is based upon the principle that one should not be permitted to unjustly enrich himself at the expense of another.  Instead, there should restitution for the property received. 

In this case, the defendants claimed there was an error at trial because there was no proof of any contractual relationship between the parties.  However, the basis of recovery was not in contract, but rather quasi contract with restitution as the remedy.  Restitution amounts to restoring to a party that property or money that was wrongfully taken or received by another. The basic idea is that one party should not benefit unfairly to the detriment of another. 

When unjust enrichment applies, a plaintiff can recover in restitution without a contract.  In Connecticut lawsuits, you typically see claims for unjust enrichment in circumstances where there may be no valid contract in place but one of the following occurred:

  • Services rendered, but not paid for
  • Wrongful receipt of profits
  • Mistakes made in payment to the wrong party
  • Improvements to property

In his case, the Appellate Court found that the defendants accepted the benefit of the renovations and made a profit upon the sale of the house.  There was some difficulty in establishing the proper damages, but the Appellate Court upheld the finding of damages that amounted to the expenditures of the plaintiffs.  

Did Courtney Love Make A Good Decision To Settle Her Twitter Case?

According to various online sources and media outlets, Courtney Love has settled (or is close to settling) the Twitter lawsuit brought against her by Dawn Simorangkir.  The trial was supposed to start tomorrow, and according to Amanda Bronstad at the National Law Journal, it was going to be broadcasted live.  Love was reportedly going to defend the case claiming that the Twitter comments were just opinion or hyperbole.   I categorized this as the "it was just a Tweet" defense. 

If the facts that have been reported are accurate, Love’s decision to go for a settlement was probably a good one.  Love’s defense was not likely to succeed.  She didn’t make isolated rambling comments.  There appeared to be intent to harm Simorangkir’s reputation in business with the comments.  In Connecticut, this may have amounted to defamation per se, trade libel, or commercial disparagement.

Given the nature of the comments, Simorangkir might have been entitled to a damages award even if she could not show a loss of business.     Simorangkir’s lawyer said Love "embarked in what is nothing short of an obsessive and delusional crusade to terrorize and destroy."    If true, the case goes beyond a simple Tweet or personal opinion.

The Twitter, Facebook, and LinkedIn universe was waiting to see what a jury would say about social media and defamation.  Unfortunately, if the settlement is final, we now have to wait for the next big Twitter defamation case.  It will not take long. 

Connecticut Business Lawsuit Roundup

As a new addition in 2011, I am going to regularly feature new business lawsuits along with the usual trial and appellate decisions of interest in Connecticut.  Here’s the first installment:

Appellate Court:

Cianci v. Original Werks, LLC 

Appellate Court finds that $150,000 mechanic’s lien was timely filed despite claim that it was made after statutory limit of 90 days from date "services" were performed. The decision includes a discussion of the legislative history of the mechanic’s lien statute and the definition of "services" under the statute. The court determined that services includes work done in or utilized in the building to be constructed, raised, removed, or reparied or the improvement of any lot or subdivision. In this case, the court construed the mechanic’s lien statute liberally and found that that contractor returning to the property at the request of the homeowner to investigate alleged deficiencies constituted lienable services.

Walpole Woodworkers, Inc.  v. Manning

Appellate Court finds that homeowner who raised the Home Improvement Act’s technical requirements of start and finish date in bad faith.  The Home Improvement Act in Connecticut requires registered contractors to include the following in written agreements:

  •  signatures of owner and contractor
  • name and address of contractor
  • cancellation rights
  • start date and completion date

Failure to include these requirements can result in technical defenses to enforcement of a  home improvement contract.  However, a homeowner cannot successfully raise these defenses in bad faith.  In this case, the homeowner had no real dispute with the work but refused to pay.  The Appellate Court upheld a finding of bad faith when the homeowner tried to raise the lack of start date and completion date in the contract.

Read here for one of my old posts on Connecticut’s Home Improvement Act requirements and defenses.

New Lawsuits:

Environmental Energy Services, Inc v. Cylenchar Limited, et al.  United States District Court.

Plaintiff Environmental is a Connecticut corporation and claims that Defendants (both from England) made misrepresentations which induced plaintiff to perform services. Plaintiff claims breach of a partnership agreement, unjust enrichment, fraud, and violation of Connecticut’s Unfair Trade Practices Act. Plaintiff alleges that it was in a joint venture business with Defendants to market a technology that removes mercury from exhaust gasses in coal fired utilities. Pursuant to the joint venture, Defendants were to provide a significant cash investment, provide technical assistance, and a license. Plaintiff was to market the technology. Plaintiff alleges that it spent significant sums marketing the technology and gaining a trial customer for the new technology at which time the Defendants issued a cease and desist to Plaintiffs and refused to continue with the joint venture.

 

Tellar v. Webber, et al.  State Judicial District of Hartford.

Plaintiff and Defendant were equal owners of a limited liability company (LLC) engaged in the relish making business.  Plaintiff alleges that Defendant, his co-owner, dissolved the LLC without consent and started another relish business.  Plaintiff alleges the Defendant did so without sharing profits or including Plaintiff.  Plaintiff brought suit as an individual and derivatively on behalf of the the LLC against his co-owner in the LLC and the co-owner’s new business.  The Plaintiff claimed breach of contract to share profits, breach of good faith and fair dealing, breach of fiduciary duty, conversion, civil theft, unfair trade practices, and usurping a corporate opportunity.

Connecticut Bar Association Launches Blog

Rule of Law Blog:

The Connecticut Bar Association has launched this new blog. The purpose of the blog is to "ensure a sustaining interest" in the discussion of "what our laws are doing right, what they are doing wrong, and how they can improve."    Today, there is a post related to President Obama’s executive order related to reviewing the federal regulatory structure and its impact on business.  There is a good comparison of positions from the New York Times and the Wall Street Journal. I look foward to following the posts on this new blog. Congratulations to the CBA.