Beacon Insurance & Investment Group, LLC v. Panzo
| Decision Date | 25 July 2016 |
| Docket Number | CV146044992S |
| Court | Connecticut Superior Court |
| Parties | Beacon Insurance & Investment Group, LLC v. Annette M. Panzo et al |
UNPUBLISHED OPINION
This matter arises from the acts of two individuals allegedly taken in breach of non-competition agreements that they had entered into with their former employer. On February 12 2014, the plaintiff, Beacon Insurance & Investment Group LLC, commenced this action by service of process on the defendants, Annette M. Panzo and David Sagnella. In the second amended complaint, dated February 13, 2015, the plaintiff raises three claims against the defendants sounding in breach of contract, tortious interference, and breach of the covenant of good faith and fair dealing.[1]
A trial was held on February 23 and 24, 2016, during which the court heard testimony from the following witnesses: Frank Trentini the owner of Beacon Insurance & Investment Group, LLC; Panzo; Sagnella; Joseph Votto; and Mike Azzaro, another former employee of the plaintiff. The parties submitted additional evidence that will be discussed below, as necessary. At the close of the plaintiff's case, Panzo and Sagnella each moved for a directed verdict. This court denied both motions. Following the trial, on April 25, 2016, per order of the court, the parties submitted proposed findings of fact and conclusions of law.
(Citations omitted; internal quotation marks omitted.) Welsch v. Groat, 95 Conn.App. 658, 664, 897 A.2d 710 (2006).
The burden of proof is on the plaintiff to prove all of the essential allegations of its complaint. Lukas v. New Haven, 184 Conn. 205, 211, 439 A.2d 949 (1981). " While the plaintiff is entitled to every favorable inference that may be legitimately drawn from the evidence, and has the same right to submit a weak case as a strong one, the plaintiff must still sustain the burden of proof on the contested issues in the complaint and the defendant need not present any evidence to contradict it . . . The general burden of proof in civil actions is on the plaintiff, who must prove all the essential elements of [its] cause of action by a fair preponderance of the evidence." Gulycz v. Stop and Shop, 29 Conn.App. 519, 523, 615 A.2d 1087, cert. denied, 224 Conn. 923, 618 A.2d 529 (1992). Failure to do so results in judgment for the defendant. Id.
The ordinary civil standard of proof is the fair preponderance of the evidence standard. Freeman v. Alamo Management Co., 221 Conn. 674, 678, 607 A.2d 370 (1992). " The burden of persuasion in an ordinary civil action is sustained if evidence induces in the mind of the trier a reasonable belief that it is more probable than otherwise that the fact in issue is true." (Internal quotation marks omitted.) Lopinto v. Haines, 185 Conn. 527, 533, 441 A.2d 151 (1981). The standard of proof, a fair preponderance of the evidence, is " properly defined as the better evidence, the evidence having the greater weight, the more convincing force in your mind." (Internal quotation marks omitted.) Cross v. Huttenlocher, 185 Conn. 390, 394, 440 A.2d 952 (1981).
The court makes the following findings of fact based on a fair preponderance of the evidence. The plaintiff is an insurance company that sells property, casualty, life, accident, and health insurance products, as well as annuity products. Since February 12, 2000, the plaintiff has been located at numerous addresses within East Haven, Connecticut. The plaintiff advertises exclusively within New Haven County, and has had clients in every town and city within New Haven County. At least 85% of the plaintiff's customer base is located in New Haven County.
In October 2008, the plaintiff hired Panzo as an insurance agent responsible for the solicitation and sale of the plaintiff's products to new and existing clients. As an insurance agent, Panzo was paid a commission upon the sale or renewal of insurance products to the plaintiff's existing and new clients. From 2008 to 2010, Panzo was also paid an hourly compensation for training and customer service work. When Panzo was hired, she had no client base, or " book of business, " of her own. All of the clients for which Panzo was paid a commission by the plaintiff were acquired before or during her tenure at the company. Panzo's commissions were subject to a reduction or " charge back" in the event that Panzo had already been paid a full commission but as a result of a cancellation or reduction in the insurance policy premium, the plaintiff's commission was subsequently reduced.
On or about November 15, 2010, the plaintiff tendered to Panzo a non-competition agreement, which provided in part: " Employee agrees that for a period of two (2) years from the date of any termination of Employee's employment with the Company (the 'Restricted Period'), neither Employee nor any entity of which Employee is an owner, employee, partner, consultant, agent, representative, member or shareholder . . . shall, directly or indirectly, within [the State of Connecticut, its New Haven County] to this agreement: (a) Compete against the Company products or services by selling any similar type of products or services now offered by the Company or currently in research and development at the Company for a two (2) year period following any termination or separation of Employee; (b) Solicit current customers of the Company; (c) Will not solicit any person . . . located or having a location within New Haven County Connecticut to purchase insurance products or services; (d) Will not sell or broker any insurance products or services to any person . . . located or having a location within New Haven County Connecticut." Panzo was further obligated to refrain from recruiting or hiring the plaintiff's employees.
In exchange for Panzo's assent to the non-competition agreement, the plaintiff offered Panzo an increase in hourly compensation, from $10 to $13, along with an increase in the number of available work hours. After being afforded the opportunity to consult an attorney regarding the agreement, Panzo executed the agreement on November 15, 2010. Thereafter, beginning on January 2, 2011, Panzo received an increase in hourly compensation and a commensurate increase in the number of available work hours.
On January 28, 2013, the plaintiff hired Sagnella as an insurance agent. Sagnella's position was substantially similar in duties and compensation to Panzo's position. That same day, after having an opportunity to review it with an attorney, Sagnella signed a non-competition agreement that carried the same restrictions as were imposed on Panzo.
During the workday on December 10, 2013, Panzo quit employment with the plaintiff. Soon after, on December 23, 2013, Panzo formed an insurance agency, the A. Panzo Insurance Group, LLC (Panzo Group), located in Killingworth, Connecticut. Killingworth is in Middlesex County. Since its founding, Panzo Group has sold the same insurance products and has represented nearly the same group of insurance clients as the plaintiff. Panzo Group has advertised itself on Facebook, where it was available to be seen by the plaintiff's customers and other potential customers within New Haven County.
Beginning on January 12, 2014, Panzo solicited and sold competitive products to the plaintiff's existing clients, including those for whom she had received a commission while in the plaintiff's employ and others who had been clients of the plaintiff prior to Panzo's hiring in October 2008. From March 2014 to November 2014, Panzo also diverted the plaintiff's existing clients to the Jack Abbels Agency, a competitor of the plaintiff located in New Haven County. For doing so, Panzo received 75% of the commissions generated for two years.
On January 21, 2014, Sagnella quit employment with the plaintiff. Beginning on February 21, 2014, Panzo authorized Sagnella to work for Panzo Group as an insurance agent to solicit and sell competitive products to the plaintiff's existing customers. Indeed, Sagnella did conduct business with the plaintiff's existing clients, including those clients for whom Sagnella had received a commission while employed by the plaintiff and other clients who had been with the plaintiff prior to Sagnella's hiring in 2013. Likewise, in May and September 2014, Sagnella also diverted the plaintiff's existing clients to the Jack Abbels Agency, for which he received 75% of the commissions generated for two years. The court will set forth additional facts as necessary.
ENFORCEABILITY OF THE NON-COMPETITION AGREEMENT
The plaintiff's claims arise from the defendants' actions taken in breach of their employment contracts, in particular the non-competition agreement to which each defendant assented. The defendants argue that the non-competition agreement was overbroad and unreasonably restricted the defendants' ability to pursue their chosen livelihood.
" Some jurisprudential background is in order. It is the general rule that competent persons shall have the utmost liberty of contracting and that their...
To continue reading
Request your trial