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Gregory D'Alessandro Enterprises, Inc. v. Universal Marketing Group

March 27, 2008


On appeal from the Superior Court of New Jersey, Law Division, Morris County, Docket No. L-2415-05.

Per curiam.


Argued February 5, 2008

Before Judges Skillman, Winkelstein and LeWinn.

Plaintiff NBS Marketing is a small marketing and sales company located in Montville that specializes in the food and grocery industry. Its clients typically include manufacturers and wholesalers of food and related products. As described by its principal, Gregory D'Alessandro, "NBS works with the client to develop a marketing strategy beneficial to that client, considering such factors as the client's competitors in the industry, details of the product, demographics, market share, an analysis of the price point at which a consumer might be interested in purchasing and trying a new product, the best way to deliver the product to the market and other related factors."

Defendants Thomas Cooper and Lois Clough were formerly employed by NBS Marketing as senior account managers. Cooper began his employment in July 2001, and Clough began her employment in November 2003. Neither Cooper nor Clough had a written employment contract.

Cooper terminated his employment with NBS Marketing on March 7, 2005, and Clough terminated her employment on April 1, 2005. After terminating their employment with NBS Marketing, both Cooper and Clough became employed by defendant Universal Marketing. According to D'Alessandro, approximately ten of NBS's twenty clients terminated their business relationship with NBS virtually simultaneously with the termination of Cooper and Clough's employment, and some of them subsequently became clients of Universal Marketing.

NBS Marketing filed this action in the Chancery Division against Cooper, Clough, Universal Marketing and others alleging misappropriation of confidential information, breach of the employee duty of loyalty, conversion, tortious interference with prospective economic advantage, tortious interference with contract, unjust enrichment and civil conspiracy. After the Chancery Division denied NBS's application for a temporary restraining order, the case was transferred to the Law Division. Upon the completion of discovery, NBS made a motion for partial summary judgment on its claims for breach of the duty of employee loyalty against Cooper and Clough and its claim of unjust enrichment against Universal Marketing.

The breach of the duty of loyalty claim against Cooper was based on the fact that Cooper performed certain services for Joseph Rutigliano & Sons, a former client of NBS Marketing, during February 2005, while he was still employed by NBS. The claim against Cooper was also based on the allegation that, while still employed by NBS, he arranged for one of NBS's clients, Washington Quality Foods,*fn1 to terminate its relationship with NBS and appoint Universal Marketing as its marketing representative. As damages for these alleged breaches of the duty of loyalty, NBS sought recovery of the salary paid to Cooper between January 1, 2005 and March 7, 2005, which totaled $16,670. It also sought the recovery of $1386.55 Rutigliano allegedly paid Cooper for services provided to Rutigliano during his employment by NBS.

The breach of the duty of loyalty claim against Clough was based on the fact that during her employment by NBS she also performed services, consisting of the calculation of commissions and preparation of "deal sheets," for Colonna, a manufacturer serviced by Worldwide, which is a company that provides the same services to dairy industry clients as plaintiff provides to grocery clients. This claim was also based on Clough's admission that while still employed by NBS, she disparaged the company to some of its existing clients. As damages for its breach of loyalty claim against Clough, NBS sought the recovery of the entire salary it paid to her during the period from January 1, 2004 to April 1, 2005. It also sought the recovery of the $45,000 Colonna and Worldwide paid Clough for services performed while she was employed by NBS.

NBS Marketing's unjust enrichment claim against Universal Marketing was based on an allegation that one of its former clients, Source One, paid Universal $7,925.99 for services performed by NBS.

Defendants filed untimely opposition to NBS's motion for partial summary judgment, which the trial court indicated it would consider. This opposition included excerpts of depositions in which Cooper testified NBS had voluntarily terminated its relationship with Rutigliano before he performed any services for Rutigliano on his own, and Clough testified that Colonna had terminated its relationship with NBS in 2003 and would not have resumed that relationship under any circumstances because of a "diverting issue" Colonna had with NBS and its principals' dislike of D'Alessandro.

Without conducting oral argument, the trial court granted NBS's motion for summary judgment in its entirety. Moreover, the court imposed joint and several liability against the defendants for the $164,732.55 claimed by NBS on its breach of employee loyalty and unjust enrichment claims.

Defendants filed a motion for reconsideration, which the court denied. Defendants subsequently filed a motion to amend the judgment to impose liability against each defendant individually rather than joint and several liability. The ...

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