Indoor Billboard Nw., Inc. v. M2 Sys. Corp.
Decision Date | 12 January 2021 |
Docket Number | AC 39890, (AC 40558) |
Citation | 202 Conn.App. 139,245 A.3d 426 |
Court | Connecticut Court of Appeals |
Parties | INDOOR BILLBOARD NORTHWEST, INC., et al. v. M2 SYSTEMS CORPORATION |
Bradley A. Bell, pro hac vice, with whom were Scott M. Harrington, Stamford, and, on the brief, Philip A. Beach, pro hac vice, for the appellant in Docket No. AC 39890 and the appellee in Docket No. AC 40558 (defendant).
Arden E. Shenker, pro hac vice, with whom was John Robacynski, Hartford, for the appellees in Docket No. AC 39890 and the appellants in Docket No. AC 40558 (plaintiffs).
Keller, Elgo and Bright, Js.*
The action underlying these appeals was brought by twenty-three plaintiffs who are the victims of a fraudulent loan scheme that was created and carried out by the former manager of their custodial investment accounts.1 The plaintiffs sought to recover from the defendant, M2 Systems Corporation, the funds wrongfully transferred from their accounts by the manager
of the accounts. They sought to recover either by virtue of their rights as partial assignees of a promissory note that had been executed by the defendant in favor of a third party or under a theory of unjust enrichment. Following a trial to the court that lasted five days, the court rejected the plaintiffs’ attempt to recover damages as assignees of the note at issue but agreed with the plaintiffs that they were entitled to recover damages under a theory of unjust enrichment. The court awarded the plaintiffs $2,494,800, which included the amount wrongfully transferred from each plaintiff's investment account, as well as prejudgment interest.2
In Docket No. AC 39890, the defendant appeals from the judgment of the trial court with respect to the unjust enrichment cause of action brought by the plaintiffs. The defendant claims that the court erred in the following ways: (1) by awarding damages to a person who was neither a plaintiff in the underlying action nor a nonparty who had assigned his interest to a plaintiff in the underlying action; (2) by determining that the defendant was not entitled to a setoff; (3) by rejecting its special defense of judicial estoppel; (4) by finding that the note executed by the defendant in favor of a third party had been amended; (5) by finding that the defendant had been unjustly enriched as a result of the plaintiffs’ funds; (6) by finding that cross-traded subnotes, which had been exchanged between some of the plaintiffs’ accounts, had unjustly enriched the defendant; (7) by finding that the defendant's loan obligation to a third party was satisfied in part with the use of the plaintiffs’ funds; and (8) by finding that the plaintiffs had satisfied in part the defendant's debt obligation to a third party despite the fact that the debt was not discharged pursuant to the terms of the note at issue.
Docket No. AC 40558 is the plaintiffs’ appeal from the court's decision denying their postverdict motion for attorney's fees. In their appeal, the plaintiffs claim that the court erred by denying their motion for attorney's fees and expenses after rendering judgment in their favor with respect to their unjust enrichment cause of action. We agree with the first claim raised by the defendant in Docket No. AC 39890 and, consequently, reverse the portion of the judgment that is the subject of that claim. With respect to the remainder of the claims raised by the defendant in Docket No. AC 39890 and the claim raised by the plaintiffs in Docket No. AC 40558, we affirm the judgment and the decision of the trial court.
In its memorandum of decision filed November 23, 2016, the court aptly summarized the relevant procedural history of the case, including the nature of the plaintiffs’ causes of action and the defendant's defenses, and set forth the facts and legal bases of its decision. The court began its decision as follows:
The court next set forth the following findings: "There are twenty-three plaintiffs in this lawsuit. Each held investments in custodial accounts that were maintained with the wealth and services division of [the] State
[bank].3 Each plaintiff entered into an account agreement with the bank that stated [that] Tauris Advisory Group, LLC (TAG), was the account owner's agent and authorized investment manager. Each plaintiff also entered into investment-management agreements with TAG. The TAG agreements stated that TAG was the plaintiffs’ agent and authorized investment manager.
[The defendant] obtained the loan so that it could assist IQL in obtaining computer equipment. IQL was pursuing a business venture that involved providing ‘offshore’ services to gamblers. [The defendant] designed IQL's computer system and provided maintenance and support services at IQL's data center in Antigua. IQL's stock was traded on a stock exchange in London, England.
and, in addition, paid $45,000 for interest that had accrued between the original due date, April 24, 2007, and the date of the fee payment.
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Williams v. Town of Mansfield
...a court's decision is challenged on the basis of a question of law, our review is plenary. Indoor Billboard Northwest, Inc. v. M2 Systems Corp. , 202 Conn. App. 139, 197, 245 A.3d 426 (2021). In this case, the court did not make a discretionary determination about what fees and costs, if an......