B.J. Alan Co. v. Andrews ( 2014 )

[Cite as B.J. Alan Co. v. Andrews, 2014-Ohio-2938.]
STATE OF OHIO, MAHONING COUNTY
IN THE COURT OF APPEALS
SEVENTH DISTRICT
B.J. ALAN COMPANY, )
) CASE NO. 13 MA 55
PLAINTIFF-APPELLEE, )
)
VS. ) OPINION
)
FRED ANDREWS, )
)
DEFENDANT-APPELLANT. )
CHARACTER OF PROCEEDINGS: Civil Appeal from Common Pleas Court,
Case No. 05CV3942.
JUDGMENT: Affirmed.
APPEARANCES:
For Plaintiff-Appellee: Attorney Timothy Jacob
201 East Commerce Street
Atrium Level Two
Youngstown, Ohio 44503-1641
For Defendant-Appellant: Fred Andrews, Pro se
P.O. Box 5590
Poland, Ohio 44514
JUDGES:
Hon. Joseph J. Vukovich
Hon. Frank D. Celebrezze, Jr.,
Judge of the Eighth District Court of Appeals,
Sitting by Assignment.
Hon. Kathleen A. Keough,
Judge of the Eighth District Court of Appeals,
Sitting by Assignment.
Dated: June 20, 2014
[Cite as B.J. Alan Co. v. Andrews, 2014-Ohio-2938.]
VUKOVICH, J.
{¶1} Defendant-appellant Fred Andrews appeals the decision of the
Mahoning County Common Pleas Court granting plaintiff-appellee B.J. Alan summary
judgment on Andrews’ counterclaim. Andrews argues that the trial court erred and
destroyed his ability to defend B.J. Alan’s summary judgment motion when it stayed
discovery pending resolution of that summary judgment motion. After reviewing the
summary judgment motions, the trial court found that the issues raised in the
counterclaims were already decided by the trial court in its earlier decisions and in
the appeals from those decisions.
{¶2} For the reasons expressed below, the judgment of the trial court is
hereby affirmed. We hold that the trial court did not abuse its discretion in staying
discovery pending the resolution of B.J. Alan’s summary judgment motion. The
issues raised in the counterclaim and the amended counterclaim did not require
additional discovery because the issues were already decided by the trial court and
this court in prior cases. Furthermore, the trial court did not err when it granted
summary judgment for B.J. Alan.
Statement of the Case and Facts
{¶3} In 2005, B.J. Alan filed a complaint against Andrews seeking to enjoin
Andrews from opening and operating retail fireworks stores. Andrews had been
employed by B.J. Alan from 1994 until his resignation in 2005. In 2004, while
working in B.J. Alan’s fireworks operation as an executive, Andrews signed a non-
compete clause. In 2005, after his resignation, Andrews opened or attempted to
open retail fireworks stores in Pennsylvania and Hawaii.
{¶4} In response to the complaint, Andrews counterclaimed alleging that he
was promised a bonus in 2004 and did not receive it.
{¶5} This case is the third appeal arising from the underlying actions. B.J.
Alan v. Andrews, 7th Dist. No. 06MA151, 2007-Ohio-2608 (B.J. Alan I); B.J. Alan v.
Andrews, 7th Dist. No. 10MA87, 2011-Ohio-5165 (B.J. Alan II).
{¶6} In B.J. Alan I we were asked to review the trial court’s decision to grant
an injunction in favor of B.J. Alan. We upheld the enforceability of the non-compete
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clause and affirmed the trial court’s decision to grant the injunction as to the
Pennsylvania store. B.J. Alan I at ¶ 26-30, 36-61. However, as to the Hawaii store,
we determined that the language of the non-compete agreement did not prohibit
Andrews from operating his store in Hawaii. Id. at ¶ 31-35, 61. Thus, the trial court’s
order enjoining Andrews from operating the Hawaii store was reversed. Id.
{¶7} B.J. Alan II arose from Andrews’ alleged violations of the injunction. As
a result of those alleged violations B.J. Alan filed a motion to show cause. B.J. Alan
II at ¶ 2. The trial court found Andrews in contempt of the injunction order, extended
the injunction for 12 months, found that an award of attorney fees and costs in
prosecuting the contempt proceeding was appropriate and just, fined him $250 and
sentenced Andrews to 30 days in jail, but stated that Andrews could purge himself of
the contempt and avoid serving a jail sentence by strictly complying with the order to
refrain from competing for one year and by paying reasonable attorney fees and
costs. Id. at ¶ 3-9. Thereafter, B.J. Alan filed a motion for attorney fees incurred in
the prosecution of the contempt proceedings. The court found that $20,000 was a
fair and reasonable amount. Id. at ¶ 12. Andrews appealed from those orders. Id.
In B.J. Allan II, we affirmed the trial court’s decisions. Id. at ¶ 32.
{¶8} Following the B.J. Alan II decision, Andrews moved to amend his
counterclaim. 06/06/12 Motion. The original counterclaim was based on B.J. Alan’s
alleged promise to give Andrews a bonus in 2004 which did not happen. This
counterclaim asserted breach of contract, promissory estoppel, unjust enrichment
and negligent misrepresentation causes of action. Those causes of action were
restated in the amended complaint and the additional causes of action of fraud and
spoliation of evidence were added. 08/14/12 Amended Complaint. In his fraud
claim, he asserted that all his previous allegations in the complaint indicate that B.J.
Alan committed fraud. The spoliation of evidence claim is a general claim that B.J.
Alan destroyed evidence to prevent Andrews from proving his case.
{¶9} The trial court granted the motion to amend. 07/10/12 J.E. The
amended complaint was filed on August 14, 2012.
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{¶10} The next day, B.J. Alan filed a motion for summary judgment. 08/15/12
Motion. In the motion, B.J. Alan asserted that the fraud claim was not pled with
particularity, that there was no evidence of willful destruction of evidence, and that it
turned over all evidence requested. As to the claims concerning the alleged bonus, it
stated that the evidence shows that the bonus was discretionary and that our prior
decision in 2007 even states as such.
{¶11} Andrews then asked for an extension of time to complete discovery,
and the magistrate granted that request. 08/21/12 Motion; 09/05/12 J.E. The
extension was granted until September 28, 2012.
{¶12} On August 29, 2012, Andrews filed his motion in opposition to summary
judgment. Thereafter, Andrews gave notice to take the depositions of Bruce Zoldan,
Jack Abell, Pete Frank, Timothy Jacob, Stephen Bolton and William Weimer.
09/11/12 Notice.
{¶13} A few days later, B.J. Alan moved to stay the magistrate’s order
extending time for discovery and moved to set aside that order. 09/14/12 Motions. In
consideration of that motion, the magistrate issued an order stating that “the
depositions scheduled for September 28, 2012 shall not go forward.” 09/17/12
Magistrate Decision. Despite that order, Andrews filed two more production of
discovery motions and one more notice of taking depositions. 09/19/12 and 10/01/12
Compel Discovery Motions; 09/24/12 Notice.
{¶14} A hearing on the motions for summary judgment occurred on
September 28, 2012. At the conclusion of the hearing, the magistrate stayed
discovery pending the outcome of the summary judgment motion. 09/28/12 Tr. 48.
{¶15} On October 2, 2012, B.J. Alan filed a motion for a protective order
claiming Andrews filed a Notice to Compel Discovery and Depositions seeking a
number of depositions for October 9, 2012. The basis for the protective order was
the previous order staying discovery. B.J. Alan also indicated that Pete Frank no
longer works for B.J. Alan. The trial court issued a protective order stating that based
on previous orders discovery is stayed pending resolution of the summary judgment
motion.
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{¶16} On January 9, 2013, the magistrate granted B.J. Alan’s motion for
summary judgment. Based on the prior trial court opinions and appellate court
decisions, it found that there were no issues of fact to be decided. 01/09/13
Magistrate’s Decision. Andrews filed objections to that decision and in response B.J.
Alan filed a motion in opposition to the objections. 01/22/13 Objections; 03/01/13
Opposition. The trial court overruled the objections and adopted the magistrate’s
decision as its own. 03/28/12 J.E. Andrews timely appeals pro se.
Assignment of Error
{¶17} “The trial court erred in entering judgment against Defendant, Fred
Andrews after denying the Defendant’s discovery, raised upon fraudulent
representation of Plaintiff’s counsel.”
{¶18} At the outset, it is noted that the Andrews’ brief is pro se. Since early
2011, Andrews has chosen to represent himself in the resolution of his
counterclaims. The pro se brief raises arguments to support his position that the trial
court’s judgment should be reversed. However, the brief does not contain citations to
law to support Andrews’ position. App.R. 16(A)(7) requires citation to law.
Regardless of this deficiency, we will still consider the arguments presented.
{¶19} The main contention of arguments raised in Andrews’ brief is that when
the court stayed the discovery pending the outcome of the summary judgment
motion, it denied him the opportunity to defend the motion for summary judgment.
Intertwined within this contention is his position that summary judgment should not
have been granted in B.J. Alan’s favor on his counterclaims.
{¶20} A trial court’s decision to grant a stay of discovery pending the
resolution of a dispositive motion is reviewed for an abuse of discretion. Thomson v.
Ohio Dept. of Rehab. & Corr., 10th Dist. No. 09AP–782, 2010–Ohio–416, ¶ 32. See
also Briggs v. Wilcox, 2013-Ohio-1541, 991 N.E.2d 262, ¶ 43 (8th Dist.) (discussing
that the decision whether to allow a Civ.R. 56(F) motion for additional time to
complete discovery to defend a motion for summary judgment is within the trial
court’s discretion). An abuse of discretion connotes more than a mere error of
judgment; it implies that the court's attitude is arbitrary, unreasonable or
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unconscionable. Blakemore v. Blakemore, 5 Ohio St.3d 217, 219, 450 N.E.2d 1140(1983). When applying this standard of review, we may not freely substitute our
judgment for that of the trial court. In re Jane Doe I, 57 Ohio St.3d 135, 137–138,
566 N.E.2d 1181 (1991).
{¶21} Considering the history of this case, we cannot conclude that the trial
court abused its discretion when it stayed the discovery. The complaint was filed in
2005, more than seven years ago. Discovery has already occurred in this case.
There was a final decision on the injunction in 2006 and an appeal from that decision.
The decision from that appeal shows that the depositions of Zoldan and Weimer have
already been taken. Plus, those individuals and Abell testified at the injunction
hearing. Furthermore, there was also a contempt hearing following the first appeal
and a contempt finding that was appealed to this court.
{¶22} The purpose of staying the discovery was to determine whether the
counterclaim and amended counterclaim raised any new issue that was not decided
by the trial court or the appellate court. If no new issue was raised then there was no
need for additional discovery; the doctrines of res judicata and/or law-of-the-case
would bar re-raising issues that were already litigated or could have been litigated. If
there were new issues, then summary judgment would not have been granted and
discovery would have proceeded.
{¶23} Therefore, the stay of discovery did not prevent him from defending the
summary judgment motion. All he had to show was that the issues he was raising
were new issues.
{¶24} The trial court correctly found that he did not meet that burden and thus,
correctly granted summary judgment. We review a trial court’s decision to grant
summary judgment using a de novo standard of review. Cole v. Am. Industries &
Resources Corp., 128 Ohio App.3d 546, 552, 715 N.E.2d 1179 (7th Dist.1998).
Thus, we apply the same test the trial court uses, which is set forth in Civ.R. 56(C).
That rule provides that the trial court shall render summary judgment if no genuine
issue of material fact exists and when construing the evidence most strongly in favor
of the nonmoving party, reasonable minds can only conclude that the moving party is
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entitled to judgment as a matter of law. State ex rel. Parsons v. Flemming, 68 Ohio
St.3d 509, 511, 628 N.E.2d 1377 (1994).
{¶25} In the motion requesting summary judgment on Andrews’
counterclaims, B.J. Alan argued that the issues raised were already decided in the
previous rulings and appeals, and thus, the doctrines of res judicata and law-of-the-
case applied.
{¶26} The doctrine of res judicata consists of two related concepts - claim
preclusion and issue preclusion. Grava v. Parkman Twp., 73 Ohio St.3d 379, 381,
653 N.E.2d 226 (1995). Claim preclusion holds that a valid, final judgment rendered
on the merits bars all subsequent actions based upon any claim arising out of the
transaction or occurrence that was the subject matter of the previous action. Ft. Frye
Teachers Assn., OEA/NEA v. State Emp. Relations Bd., 81 Ohio St.3d 392, 395, 692
N.E.2d 140 (1998). Issue preclusion holds that a fact or a point that was actually and
directly at issue in a previous action, and was passed upon and determined by a
court of competent jurisdiction, may not be drawn into question in a subsequent
action between the same parties or their privies, whether the cause of action in the
two actions be identical or different. Id.{¶27} Under the law-of-the-case doctrine, “an inferior court must act in
accordance with the ruling of a reviewing court when conducting subsequent
proceedings on the same matter.” (Emphasis added.) Unick v. Pro–Cision, Inc., 7th
Dist. No. 09MA171, 2011–Ohio–1342, ¶ 44, citing Nolan v. Nolan, 11 Ohio St.3d 1, 3,
462 N.E.2d 410 (1984). “[T]he doctrine provides that the decision of a reviewing
court in a case remains the law of that case on the legal questions involved for all
subsequent proceedings in the case at both the trial and reviewing levels.”
(Emphasis added.) Nolan at 3.
{¶28} In the original counterclaim and in the amended counterclaim, Andrews
contends that there was an agreement between himself and Bruce Zoldan that he
would receive a bonus. He claims that he signed the non-compete clause because
he was told that if he signed it he would get both a raise and a bonus. In this
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argument, Andrews is claiming that the raise and bonus is consideration for him
entering into the non-compete contract.
{¶29} This type of argument could have been raised as a defense to the
injunction. Likewise, it could have been raised in the 2006 appeal. However, it was
not; Andrews did not argue in B.J. Alan I that B.J. Alan did not perform their part of
the contract by failing to pay the bonus. Instead he conceded that he did not get a
bonus because he insisted on negotiating the terms of his non-compete clause. In
arguing that he had good reason to terminate his employment with B.J. Alan, he
stated that “he was denied a bonus because of his insistence to negotiate the terms
of non-compete clause.” B.J. Alan I, 7th Dist. No. 06MA151, 2007-Ohio-2608 at ¶
19. Thus, Andrews abandoned the theory that the contract for a bonus was not
performed and instead pursued the theory that there was no consideration for the
non-compete clause, and thus, it could not be an enforceable contract. Id. at ¶ 10.
{¶30} In B.J. Alan I, we found no merit with the consideration argument he
presented. Id. at ¶ 12-18. We stated that the terms of the non-compete clause were
made by mutual agreement. Id. at ¶ 13-14. We cited the Ohio Supreme Court for
the position that the presentation of a noncompetition agreement by an employer to
an at-will employee is, in effect, a proposal to renegotiate the terms of the parties’ at-
will employment. Id. at ¶ 16, citing Lake Land Emp. Group of Akron, LLC v.
Columber, 101 Ohio St.3d 242, 2004-Ohio-0786, ¶ 19. Thus, the promise of
continued employment is sufficient consideration to support the enforcement of a
non-compete agreement entered into by the two parties. We then stated:
In this case, Andrews was an at-will employee of B.J. Alan.
There is no evidence that the parties ever entered into a contract
either before or after they signed the non-compete clause. After the
parties signed the non-compete clause, Andrews continued his
employment with B.J. Alan. Accordingly, there was sufficient
consideration supporting the agreement to make it enforceable.
(Emphasis Added.) B.J. Alan I at ¶ 17.
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{¶31} Consequently, our decision indicates that there was no evidence that
there was a contract between the parties concerning the bonus. That determination
is the law-of-the-case and Andrews is barred by that doctrine and res judicata from
now attempting to change his theory of the case. Therefore, the claims in the original
counterclaim that were reasserted in the amended counterclaim fail and summary
judgment was appropriately granted on them.
{¶32} The remaining causes of action in the amended counterclaim are
spoliation/discovery violations and fraud. These claims deal with the alleged contract
for the bonus and the retail store in Shrewsbury, Pennsylvania/Glen Rock,
Pennsylvania.
{¶33} Beginning with the fraud counterclaim based on the alleged contract for
the bonus, this claim fails based on law of the case and res judicata doctrines. As
explained above, the contract for a bonus was already raised or could have been
raised in the prior rulings and appeals of those rulings. Thus, that claim fails.
{¶34} As to the spoliation and fraud claims in regards to the retail store in
Shrewsbury, Pennsylvania, these claims also fail based on res judicata and/or law of
the case. In B.J. Alan I, B.J. Alan’s intent to have a retail location in Pennsylvania
and whether Andrews violated the non-compete agreement by opening or attempting
to open a store in Pennsylvania was litigated. In that decision, we found that the
evidence supported the magistrate’s conclusion that Andrews knew that B.J. Alan
had an interest in establishing a business in that area in Pennsylvania. B.J. Alan I,
7th Dist. No. 06MA151, 2007-Ohio-2608, at ¶ 26-30. It seems that now Andrews is
asserting that B.J. Alan had no intention of opening a retail store in Shrewsbury,
Pennsylvania and thus, is guilty of fraud and spoiling evidence violations that would
prove that. This argument, like the above argument regarding the bonus, should
have been raised in the injunction matter, B.J. Alan I or in the contempt matter in B.J.
Alan II. However, it was not. Our decision in B.J. Alan I indicates that Andrews knew
of B.J. Alan’s intent to open a retail store in that location. Thus, he cannot now claim
that there was no intention on B.J. Alan’s part to open a store in that area. This is
merely an attempt to re-litigate an issue that has already been decided.
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{¶35} Therefore, for the reasons expressed above, this assignment of error
lacks merit. The judgment of the trial court is hereby affirmed.
Celebrezze, J., concurs.
Keough, J., concurs.