Breach of Duty of Loyalty

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Civil

WI Court of Appeals – District II

Officials: Kloppenburg, P.J., Lundsten and Blanchard, JJ

Breach of  Duty of Loyalty

2014AP2941 Matenaer Corporation v. Thomas Peterson

Thomas Peterson, a former sales representative for Matenaer Corporation, appeals a judgment entered after a bench trial in which the circuit court awarded Matenaer approximately $71,500 in damages on Matenaer’s claims against Peterson. The circuit court concluded that Peterson breached an implied agreement with Matenaer to repay advances made to Peterson. In addition, the court concluded that Peterson breached a duty of loyalty to Matenaer, and interfered with Matenaer’s contractual relationship with a customer, by secretly working for a Matenaer competitor and diverting the customer’s business to the competitor. Peterson argues that the circuit court erred by: (1) failing to apply the “Shaler rule,” which requires that an agreement to repay advances be express; (2) finding that Peterson breached a duty of loyalty; (3) allowing Matenaer to receive lost profit damages for more than 60 days after the date Peterson claims he first notified Matenaer that he was terminating his contract; (4) calculating damages based on “theoretical” lost profits instead of “actual” lost profits; and (5) dismissing Peterson’s counterclaims. We reject these arguments and affirm.

Decision

Affirmed. Per Curiam.

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.