Hahn v. OnBoard, LLC
| Decision Date | 05 October 2011 |
| Docket Number | Civil No. 09-3639 (MAS) |
| Court | U.S. District Court — District of New Jersey |
| Parties | Robert Hahn, Plaintiff, v. OnBoard, LLC, Jonathan Bednarsh, andMarc Siden, Defendants. |
NOT FOR PUBLICATION
CLOSED
SHIPP. Michael A.. United States Magistrate Judge
This matter comes before the Court over an employment contract dispute between Plaintiff Robert Hahn ("Plaintiff' or "Hahn") and Defendants OnBoard, LLC ("OnBoard"), Jonathan Bednarsh ("Bednarsh"), and Marc Siden ("Siden") (collectively referred to as "Defendants" and Plaintiff and Defendants collectively referred to as the "Parties"). A three-day bench trial began on June 7, 2011 and concluded on June 9, 2011. The Court has considered the evidence adduced at trial, the Parties' legal positions, and the applicable law. The Court now enters final judgment on the merits of all pending claims.
This case comes before the Court based on diversity jurisdiction, pursuant to 28 U.S.C. § 1332(a)(1), after having been removed from the Superior Court of New Jersey, Essex County,pursuant to 28 U.S.C. § 1441(a). At the time this action was commenced, OnBoard was a corporation incorporated under the laws of the State of New York, and Plaintiff was a citizen of the State of New Jersey, residing in Millburn, New Jersey. Based on the allegations set forth in the Second Amended Complaint, the amount in controversy exceeds the sum of $75,000, exclusive of interest and costs. (Docket Entry Number ( ) 38 ( ); Doc. No. 37 (Defs.' "Answer" ¶ 64(a).)
This action, originally brought by Plaintiff in New Jersey Superior Court, was removed to this Court by Defendants on July 23, 2009. (Doc. No. 1 ("Notice of Removal").) Plaintiff asserts a claim for breach of the Employment Agreement and seeks $30,000 in severance pay.1 On August 4, 2010, Defendants filed their Answer,2 asserting counterclaims for breach of duty of good faith and loyalty, breach of contract, and requesting a permanent injunction to prevent Plaintiff from retaining, using or disseminating confidential and proprietary information.3 (Doc. No. 37 ¶¶ 40-64.) Plaintiff answered Defendants' counterclaims on August 30, 2010. (Doc. No. 46 ("Pl.'s Answer").) On September 22, 2010, Plaintiff moved for summary judgment on all claims and counterclaims (Doc. No. 48.), which the Court subsequently denied on February 18,2011.4 (Doc. No. 83.) On June 7, 2011, a bench trial commenced, during which seven witnesses testified. Following the trial, on June 24, 2011, the Parties each submitted Amended Proposed Findings of Fact and Conclusions of Law. (Doc. Nos. 116 ( ) ( ).)
OnBoard was founded by Defendants, Bednarsh as the President, and Siden as the Chief Operating Officer. Plaintiff was OnBoard's Vice President of Marketing commencing "on or about September 17, 2007," until May 5, 2009. The underlying claims and counterclaims pertain to whether Plaintiff was terminated with or without cause, resigned, or breached his duty of good faith and loyalty owed to OnBoard under the contract obligations pursuant to their Employment Agreement.
The Parties have stipulated that the Employment Agreement, properly executed on September 19, 2007, sets forth the "terms and conditions of Plaintiff s employment." (FPO 3; see Employment Agreement.) Under the terms of the Employment Agreement, Plaintiff was an "at-will" employee; thus, Defendants could fire him at any time with or without cause. (Employment Agreement ¶ 7.) If Plaintiff was terminated without cause, he would be entitled to: (1) severance pay in the amount of three months salary; and (2) the retention of "Exit Event Rights," which would give Plaintiff a share of the proceeds should OnBoard be sold or otherwise undergo a change in ownership (collectively "Severance Package"). (Id. at ¶7.4.) However, if Plaintiff was "terminated for Cause" or resigned his employment, he would not be entitled to the Severance Package. The Employment Agreement defines "Cause" as:
(i) an intentional act of fraud, embezzlement, theft or any other material violation of law that occurs during or in the course of [Plaintiff's] employment with [OnBoard]; (ii) intentional damage to [OnBoard's] assets; (iii) intentional disclosure of [OnBoard's] confidential information contrary to [OnBoard's] policies; (iv) intentional engagement in any competitive activity which would constitute a breach of [Plaintiff's] duty of loyalty or of [Plaintiff's] obligations under this Agreement; (v) willful conduct by [Plaintiff] that is demonstrably and materially injurious to [OnBoard], monetarily or otherwise. (Employment Agreement ¶ 7.6.)
The Employment Agreement provides further clarification of Cause, stating:
For purposes of [paragraph 7.6], and [sic] act, or a failure to act, shall not be deemed willful or intentional, as those terms are defined herein, unless it is done, or omitted to be done, by [Plaintiff] in bad faith or without a reasonable belief that [Plaintiff's] action or omission was in the best interest of [OnBoard]. Failure to meet performance standards or objectives, by itself, does not constitute "Cause". (Id.)
While Plaintiff was employed by OnBoard, he started a personal blog, "the notorious R.O.B.,"5 of which Defendants were aware. Plaintiff had a personal card for his blog ("Personal Card"),6 which included his personal e-mail address, his website address, cellular phone number, and Twitter account information, and it did not include contact information for OnBoard. On two separate occasions, Plaintiff criticized OnBoard's clients on his blog. (FPO 3.) Following client complaints, Defendants asked Plaintiff to remove the critical remarks, and hecomplied. (June 7 Tr. 28:18-29:1.) Plaintiff also used an OnBoard credit card on April 30, 2009 to purchase a blog reference book.7 (D13 ( ) D00187.)
In December of 2008, Plaintiff received his first and only performance review ("Performance Review"), which covered the fourth quarter of 2008. (D29 ("Pl.'s Review").) According to OnBoard's Employment Guidelines, the (D56 ("Employment Guidelines") D00331.) Notably, the Performance Review complimented Plaintiff for having "shown some great leadership and execution." (Pl.'s Review D00132.) It also noted, however, that Plaintiff's absences and tardiness were more frequent than preferred, but that the tardiness had "improved slightly." (Id.) The review further documented other areas of concern, as well as, favorable comments regarding Plaintiff's work at two different events. (Id.) The Performance Review generally concludes that Plaintiff "continues to be a great asset to our company and while [Defendants] can be critacal [sic] at times, [Plaintiff] seems to really understand where [Defendants] are coming from - that is a maturity that [they] appriciate [sic] very much." (Id.) Overall, Plaintiff received a score of 3.1 out of a possible 5.0. (FPO 3; Pl.'s Review D00132.)
On or around March 24, 2009, Plaintiff formally requested permission from Bednarsh and Siden to attend the Leading Real Estate Conference ("Conference") held in Scottsdale, Arizona from March 24, 2009 through March 28, 2009. (FPO 3.) Plaintiff told Defendants that there would be potential customer leads and other business opportunities for him to pursue on behalf of OnBoard. Defendants agreed andfinanced the trip to the Conference. Plaintiff, as well as Stacy Ret ("Ret"), OnBoard's Former Director of Events,8 Ira Monko, an OnBoard employee, and Michael Demetriou, OnBoard's Director of Strategic Development,9 attended the Conference.
At the Conference, Plaintiff helped to set up OnBoard's display booth, held a video focus group, participated in sales meetings, spoke with Matthew Dollinger ("Dollinger"), the Vice President of Strategic Development at World Properties, LLC, and passed out his Personal Cards. Notably, OnBoard's client, Metropolitan Regional Information Systems, Inc. ("MRIS") did not send representatives to the Conference. Also, David Charron ("Charron"), President of MRIS, was unaware that Plaintiff was employed by OnBoard at the time of the Conference. (Id.) Plaintiff's conduct at the Conference is part of the dispute underlying Defendants' breach of duty of good faith and loyalty counterclaim.
On April 27, 2009, Plaintiff registered the domain name "7DSassociates.com."10 (FPO 4.) The next day, April 28, 2009, Plaintiff and Siden met for their weekly status meeting, during which Plaintiff offered to give up his full-time position with OnBoard for a part-time position. (Id. at 3.) In response, Siden advised Plaintiff that he "need[ed]" him to remain...
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