Southeast Air Charter, Inc. v. Stroud (Lawyers Weekly No. 15-15-0715, 18 pp.) (James Gale, C.J.) 2015 NCBC 66
Holding: Plaintiff’s Rule 30(b)(6) deponent admitted that the moving defendants were “run of the mill” employees; accordingly, plaintiff lacked an adequate factual basis for claiming that the moving defendants breached a fiduciary duty to plaintiff, their employer. However, plaintiff did have an adequate factual basis for some of its claims against two of the three moving defendants.
The court grants in part and denies in part the moving defendants’ motion for attorneys’ fees and costs.
Plaintiff has voluntarily dismissed its claims against the moving defendants, so the moving defendants are entitled to an award of costs pursuant to N.C. R. Civ. P. 41(d).
With regard to the moving defendants’ motion for sanctions under N.C. R. Civ. P. 11, the court finds that some of the claims against defendants Viall and Robinson were well grounded in fact.
Before initiating the action, plaintiff had evidence, which it believed to be true, that non-moving defendant Stroud misappropriated plaintiff’s contract with Progress Energy (checking on power lines) and that moving defendants Robinson and Viall likely knew about this misappropriation. Plaintiff also learned from Joseph Chandler, a former employee and co-worker of the moving defendants, that Robinson and Viall removed personal property from plaintiff’s premises and authorized personal air charter services without charging clients. Based on reports from Chandler, plaintiff formed a reasoned suspicion that Robinson was turning down potential organ-harvest flights for plaintiff, saying no aircraft were available when aircraft actually were available. Finally, plaintiff had a reasoned suspicion that Robinson, Viall, or both, ran an eraser program on plaintiff’s computers to destroy certain documents.
Accordingly, plaintiff had a factually sufficient basis to allege that Robinson and Viall had converted and trespassed upon plaintiff’s personal property, unjustly enriched themselves and Stroud’s companies at plaintiff’s expense, concealed material facts from plaintiff, tortiously interfered with plaintiff’s existing and prospective contracts, and did so pursuant to a common agreement or plan for the Stroud companies’ benefit and at plaintiff’s expense, which conduct might rise to an actionable unfair trade practices claim.
However, the record shows no evidentiary basis for the assertion that moving defendant Steiner-Crowley even knew about any of the above acts. Plaintiff had no reasonable factual basis for bringing any claim against Steiner-Crowley.
Again, plaintiff had no reasoned basis to believe that Robinson or Viall owed plaintiff fiduciary duties as a result of their “run of the mill” employment.
Plaintiff had a reasonable belief that its claims against Robinson and Viall – other than the claims based on fiduciary duties – were warranted by existing law. The record does not support a finding that plaintiff brought its claims for an improper purpose.
Plaintiff’s prosecution of the claims for breach of fiduciary duty and constructive fraud would also support imposition of attorneys’ fees under G.S. § 6-21.5. However, the court does not find plaintiff’s unfair trade practices claim so frivolous as to justify the imposition of fees under G.S. § 75-16.1.
Defendant Steiner-Crowley is entitled to an award of reasonable attorneys’ fees incurred defending the claims asserted against her. Defendants Robinson and Viall are entitled to the reasonable attorneys’ fees they incurred for defense of the claims for breach of fiduciary duty and constructive fraud. The moving defendants are entitled collectively to recover $5,182.83 in costs.i