Lombardo v. R.L. Young, Inc.

Decision Date11 June 2020
Docket NumberCivil No. 3:18cv188 (JBA)
CourtU.S. District Court — District of Connecticut
PartiesDON LOMBARDO, Plaintiff, v. R.L. YOUNG, INC. d/b/a YOUNG & ASSOCIATES, Defendant. R.L. YOUNG, INC. d/b/a YOUNG & ASSOCIATES, Counterclaim Plaintiff, v. DON LOMBARDO and DND CONSTRUCTION SERVICES, LLC, Counterclaim Defendants.
RULING GRANTING CROSS MOTIONS FOR SUMMARY JUDGMENT

The adverse parties in this diversity action bring two distinct summary judgment cross motions. Plaintiff and Counterclaim Defendant Don Lombardo raises multiple contract claims and related equitable claims against Young & Associates ("YA"), with whom he had a business relationship from 2010 to 2017. Defendant and Counterclaim Plaintiff YA has also brought four tortious interference counterclaims against Lombardo and against his consulting company, DND Construction Services, LLC. ("DND"). The parties oppose all of the respective claims against them, contending that each of the claims fail as a matter of law.

For the reasons that follow, both Defendant YA's summary judgment motion [Doc. # 99] and Counterclaim Defendants Lombardo and DND's summary judgment motion [Doc. # 97] are granted in their entireties.

I. Background
A. Parties

Plaintiff and Counterclaim Defendant Don Lombardo is an individual who resides in the State of Connecticut. (Lombardo and DND L.R. Stmt. [Doc. # 98] ¶ 1.) Mr. Lombardo had a business relationship with Young & Associates from 2010 to 2017. (See YA L.R. Stmt. in Opp. [Doc. # 111] Additional Material Facts ("AMF") ¶ 1.) In 2017, Mr. Lombardo founded DND Construction Services, LLC ("DND").

Defendant and Counterclaim Plaintiff YA "is a building consulting company that works with insurance companies to estimate the cost to repair damage done to buildings after catastrophic disasters or any other type of destruction to commercial and residential buildings." (YA L.R. Stmt. [Doc. # 101] ¶ 1.) YA was originally incorporated in California, but changed its state of incorporation to Nevada in 2013. (Id. ¶ 3.) "YA generally receives its work from insurance carriers, usually via adjustor, when a loss occurs to a building; YA then assigns the job to a YA consultant to perform the work." (Id. ¶ 4.)

Counterclaim Defendant DND is a limited liability company, which was incorporated in Connecticut on March 17, 2017 and which maintains its principal place of business in Hartford, Connecticut. (Lombardo and DND L.R. Stmt. ¶¶ 2, 64.) DND "does business in the fields of building damage assessments and restoration estimates for various customers, including insurance companies, and is either a limited competitor or a competitor of [YA]. One of its owners is Lombardo." (Id. ¶ 49.)

B. Lombardo's Tenure with Young & Associates
a. The Hiring and Promotion of Lombardo

In 2010, "YA's consultants were organized in three levels: 1) a managing partner, also sometimes referred to as an executive partner; 2) a partner; and 3) a consultant," terms that YA used "as a means to designate managers from non-managers." (YA L.R. Stmt. ¶¶ 5, 6.) In YA's system, a "managing/executive partner of a geographical region manages the consultants and business in his or her region," while a "partner manages the consultants and business in a territory within a geographical region, reports to the managing/executive partner, and may at times perform damage repair estimating services." (Id. ¶¶ 7, 8.) A consultant, who is at the lowest tier, performs "damage repair estimating services, does not have any management role, and reports to his or her partner. (Id. ¶ 9.) Regardless of the title of "partner," those who worked with YA "were independent contractors who entered into independent contractor agreements with YA," as "YA did not enter into partnership agreements with any individuals or consultants." (Id. ¶ 10.)1

In 2010, YA established an East Coast presence. (See id. ¶ 11.) To that end, YA co-owner Raymond Young entered into discussions with Michael Bertino, "an individual with over forty years' experience in the construction management business and who had established contacts in the northeast." (Id. ¶ 12.) "Young and Bertino discussed and agreed that Bertino would join YA and be the managing partner of the Northeast Region and grow that region for YA." (Id. ¶ 13.) Mr. Bertino began recruiting individuals for YA's Northeast Region, and he invited Mr. Lombardo to a meeting with Mr. Young in Atlantic City "to discuss the possibility of joining YA." (Id. ¶¶ 14, 15.)

The Atlantic City meeting, held in June 2010, was the "first time Lombardo and Young ever met." (Id. ¶ 16.) Other YA recruits were also at the meeting, including Kevin Entress and Tim Clippinger. (Id. ¶ 17.) YA Chief Financial Officer Mike Kurtz was also present. (Id.) At the Atlantic City meeting, the attendees discussed the prospect of Mr. Bertino overseeing the newly formed Northeast Region with Mr. Lombardo, Mr. Entress, and Mr. Clippinger working under him. (Id. ¶ 20.)2 As a result of that Atlantic City meeting, Mr. Bertino entered an agreement with YA to jointhe company as Managing Partner and "oversee the development of YA's business in Hartford, Connecticut, Boston, Massachusetts, Philadelphia, Pennsylvania and the New Jersey and New York areas (the 'Northeast Region')." (Id. ¶ 19.) It was further discussed that Mr. Lombardo would be made the Partner of the Hartford office and that Mr. Entress would be made the Partner of the Philadelphia office. (Id.) According to Mr. Lombardo's 2018 deposition, he was given the "same deal" as Mr. Entress, (Lombardo 2018 Dep. 33-34), and that "Ray told us, 'Here's the deal,' so as far as negotiating the deal, there was really no negotiation . . . that was the end of it," (id. at 36).

At or shortly after the Atlantic City meeting, YA provided Mr. Lombardo and Mr. Entress copies of its form Independent Consulting Agreement ("ICA"). (YA L.R. Stmt. ¶ 23.) The form ICA provided that "the parties hereto are independent contractors, and nothing contained in this Agreement shall be construed to place them in the relationship of partners, principal and agent, employer and employee, or joint venturers." (Lombardo Form ICA at 1.) The ICA set a term of "one year from date of this agreement unless sooner terminated." (Id. at 4.)

The ICA also contained an addendum discussing what was termed "override" compensation. (Id. at 11.) The Override Compensation Addendum gave the signatory the authority to "engage the services of a Sub-Consultant to perform a portion of or all of the work on a particular Assignment." (Id.) It then set forth a payment schedule for "'override payments' from YA, which are a percentage of the profit made in [a] specific territory." (YA L.R. Stmt. ¶ 22.)

On July 2, 2010, Mr. Lombardo sent Mr. Young, Mr. Bertino, and Mr. Kurtz an e-mail with a subject line, "Consultant Agreement." (Ex. 12 (Lombardo July 2, 2010 E-Mail) to YA Mot. forSumm. J. [Doc. # 99-12] at 1.) Mr. Lombardo wrote that he "ha[s] read the Independent Consultant Agreement and ha[s] no issues with it," that he was awaiting the rate spreadsheet laying out the payment structure, and that he wanted to know more about "the next step in Young and Associates process." (Id.)

On July 5, 2010, Mr. Kurtz sent Mr. Lombardo an e-mail with the heading, "YOUNG & Associates - Independent Consultant Agreement" and with an attachment titled "NORTHEASTREGIONYAindependentconsultantagrmtPARTNER-MASTER(2010).pdf," which was a copy of the form ICA with a rate spreadsheet detailing the terms of the Northeast Region's override payments attached as an addendum. (Ex. 11 (Kurtz July 5, 2010 E-Mail) to YA Mot. for Summ. J. [Doc. # 99-12] at 1.) In that e-mail, Mr. Kurtz wrote, "Don, here's the contract that I mentioned in my Welcome email. . . . Once you review and sign the agreement, please send me two signed originals and I'll sign both and return one to you for your records." (Id.) Mr. Kurtz's e-mail also explained that no changes had been made to the body of the ICA, but that the rate spreadsheet needed Mr. Lombardo's close review. (See id.)

Neither party has produced an executed copy of the ICA sent to Mr, Lombardo. However, Mr. Lombardo has made multiple statements indicating that he did sign an ICA with YA. (See, e.g., Lombardo 2018 Dep. at 111 ("I know I definitely signed a contract at some point.").) Additionally, although Mr. Lombardo now declares that he "do[es] not believe there is any binding written agreement" and that he is "certain [he] did not sign" a form ICA "as [he] wanted [his] status as a partner to be clear and [he] did not agree to any restrictive covenants," his recent declaration does admit that "[a]t some point, [he] believe[s] [he] signed some sort of document that pertained to [his] relationship with YA that contained some language relating to [his] partnership status" andthat "[i]t is possible that [he] may have marked up a version of the Form ICA and mailed it to YA, but [he] may be mistaken in [his] recollection." (Lombardo Opp. Decl. ¶¶ 14, 16.)3

On July 7, 2010, Mr. Kurtz, Mr. Young, and Mr. Bertino finalized the announcement of YA's expansion of the Northeast Region. (Ex. 13 (YA Press Release E-Mail) to YA Mot. for Summ. J. [Doc. # 99-13].) The press release stated that "Mike Bertino will serve as Managing Partner of the Northeast Region overseeing the development" of YA's "two new office locations" in Hartford and Philadelphia. (Id.) The press release also stated that "Don Lombardo will assume the position of Partner responsible for the Hartford office," and that "Kevin Entress will assume the position of Partner responsible for the Philadelphia office." (Id.)

In March of 2012, YA and Mr. Bertino terminated their business relationship, and Mr. Lombardo became managing partner of the Northeast Region. (YA L.R. Stmt. ¶ 31.) This region eventually extended from Maine to Florida—excluding Georgia—and became known as "Region 26." (Id. ¶ 32.)

According to Mr. Lombardo's testimony, he and Mr. Young had...

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