Ian Dick

A former corporate officer brought a motion for summary judgment or partial summary judgment seeking dismissal of claims in a counterclaim alleging participation in a fraudulent kickback scheme involving commission payments under a produce distribution program.

The moving party argued the claims were unsupported by evidence and barred by the limitation period.

The court held that the dispute involved a complex factual matrix intertwined with claims proceeding to trial against other parties and required credibility determinations not suitable for summary judgment.

The court also found an issue of discoverability regarding the limitation period.

Leave was granted to amend the counterclaim to add a claim for gross negligence, as the amendment was tenable and caused no uncompensable prejudice.

The plaintiff employer moved for default judgment against two former employee accountants alleged to have misappropriated corporate funds over several years.

Evidence from an internal investigation and a forensic consulting report established that the defendants conducted numerous fraudulent withdrawals and falsified accounting records.

The court held the pleadings and affidavit evidence established liability for conversion, fraud, and breach of fiduciary duty and granted judgment for proven losses totaling over $1.96 million, but declined to include certain suspicious transactions that could not be adequately traced to the defendants.

Punitive damages were awarded due to the deliberate and prolonged abuse of positions of trust, though the amount sought was reduced after considering the defendants’ gambling disorder evidence, ongoing criminal proceedings, and proportionality.

The court also awarded investigative costs and substantial indemnity legal costs.