An employer sued a former supervisory employee, his spouse, and related corporations and trusts arising from a long-running undisclosed self-dealing scheme in which the employee caused the employer to retain companies he beneficially owned.
The court found the employee owed fiduciary duties because he had unilateral authority to hire contractors and approve invoices, and held he breached fiduciary duty, breach of contract, breach of confidence, and deceit by using confidential bid and budget information to direct work to his own entities without disclosure or consent.
The spouse was found liable in unlawful means conspiracy through deceitful conduct and by acting as a sham officer and director using a different name to conceal involvement.
Claims for phantom billing and conversion were dismissed for inadequate pleading and disclosure despite the court's view that the evidentiary record would otherwise have supported them.
The court ordered disgorgement of $10,264,237, punitive damages of $1,000,000, and granted accounting, tracing, and constructive trust relief.
