Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
Robert Wolfe Lawsuit - Memorandum in Opposition.pdf
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Robert Wolfe Lawsuit - Memorandum in Opposition.pdf

  1. Downs Rachlin Martin PLLC STATE OF VERMONT SUPERIOR COURT CIVIL DIVISION Orange Unit Docket No. 24-2-19 Oecv ENOCHIAN BIOSCIENCES DENMARK, ApS, ) and ENOCHIAN BIOSCIENCES, INC., ) ) Plaintiffs, ) v. ) ) CROSSFIELD, INC., and ROBERT E. WOLFE, ) ) Defendants. ) DEFENDANTS’ COMBINED MEMORANDUM OF LAW: (1) IN OPPOSITION TO PLAINTIFFS’ MOTION TO DISMISS, AND (2) IN SUPPORT OF DEFENDANTS’ CROSS-MOTION FOR ENTRY OF JUDGMENT IN DEFENDANTS’ FAVOR Pursuant to V.R.C.P. 78(b)(1), Defendants Crossfield, Inc. and Robert E. Wolfe (collectively, “Defendants”) hereby submit their Opposition to Plaintiffs’ Motion to Dismiss, which Plaintiffs filed suddenly and abruptly on April 17 with virtually no warning to Defendants. Plaintiffs Enochian Biosciences Denmark, ApS and Enochian Biosciences, Inc. (collectively, “Plaintiffs”) now request, under V.R.C.P. 41(a)(2), voluntary dismissal of this lawsuit “with prejudice and with the parties each to bear their own attorneys’ fees, expenses, and costs.”1 Pls. Mot. at 2. In other words, Plaintiffs desire to simply dismiss this fourteen (14) months’ long litigation as if it never happened. As the Court will see, Plaintiffs suddenly want to abandon this lawsuit because, after fourteen months of aggressively litigating against Defendants, they now do not want to have to answer Defendants’ discovery requests, which Defendants believe will show 1 Plaintiffs’ citation to V.R.C.P. 41(a)(2) is incorrect, as that rule applies to stipulations of dismissal. The applicable rule is V.R.C.P. 41(a)(3), which provides that “an action shall not be dismissed at the plaintiff’s request except upon order of the court and upon such terms and conditions as the court deems proper” (emphasis added). Here, the proper terms and conditions include a judgment in Defendants’ favor on all counts in Plaintiffs’ Verified Complaint. FILED: 4/30/2020 9:09 AM Vermont Superior Court Orange Unit 24-2-19 Oecv
  2. 2 of 15 Downs Rachlin Martin PLLC the groundlessness and bad faith of Plaintiffs’ claims. For the reasons set forth below, that result is unfair and unjust, and this Court instead should grant Defendants’ Cross-Motion (filed herewith) and enter a judgment in favor of Defendants. A. A Dismissal on the Terms Requested by Plaintiffs is Unfair, Unjust, and Prejudicial to Defendants. As Defendants have explained in prior filings and also showed at the November 5, 2019 evidentiary hearing on Plaintiffs’ motion for preliminary injunction, Plaintiffs terminated Mr. Wolfe (and Crossfield) as their Chief Financial Officer (CFO) in January 2019 because – as the CFO of a publicly-traded company with fiduciary duties to shareholders and legal obligations to the Securities Exchange Commission (SEC) – Mr. Wolfe persisted in questioning what he believed were serious financial improprieties at the company. Upon wrongfully firing Mr. Wolfe (after asking him to stay on for extra time to allow Plaintiffs to transition to his successor, Luisa Puche), Plaintiffs promised, in writing, to pay him everything he was owed, but then reneged on that promise. Consistent with the venue provision in his CFO Services Agreement (drafted by Plaintiffs), Mr. Wolfe filed a legal complaint in Denmark on February 7, 2019, seeking the unpaid compensation owed under his contract due to the termination. But before filing his complaint – which set forth the reasons why Mr. Wolfe believed he was terminated, including what Plaintiffs subsequently claimed in this litigation was “confidential information” – Mr. Wolfe’s Danish counsel actually sent a draft of it to Plaintiffs. Plaintiffs responded, but said nothing whatsoever about the complaint’s supposed disclosure of “confidential information.”2 2 Nor did Plaintiffs take any swift legal action in Denmark (e.g., for injunctive relief or to seal) after Mr. Wolfe made his filing. Rather, nearly three (3) weeks later, on February 26, 2019, Plaintiffs casually asked the Danish court to limit access to Mr. Wolfe’s filing “to the widest extent possible” and to permit Plaintiffs to submit a pleading before access to such information was granted.
  3. 3 of 15 Downs Rachlin Martin PLLC Then, just days after Mr. Wolfe made his filing in Denmark, but without taking any action in Denmark or warning him in any way, Plaintiffs sued Mr. Wolfe here in Vermont – despite the Denmark venue and Danish governing law provisions in Plaintiffs’ own CFO Services Agreement; despite the fact that Mr. Wolfe was subject to jurisdiction in Denmark; and despite the fact that there was already a lawsuit between the parties pending in Denmark – seeking only injunctive relief (not damages). Plaintiffs’ Vermont lawsuit alleged breach of contract (i.e., breach of the same CFO Services Agreement that was the subject of the already- pending Danish lawsuit), breach of fiduciary duty, and breach of the duty of loyalty. These claims stemmed from the disclosure of purportedly “confidential information” in Mr. Wolfe’s Danish filing, despite, as noted above, Plaintiffs having said nothing of the sort after receiving an advance draft of that filing. Plaintiffs also moved ex parte for a temporary restraining order and preliminary injunction on the grounds that Mr. Wolfe had disclosed “confidential information” and that Plaintiffs had suffered and would continue to suffer irreparable harm unless Defendants were enjoined from disclosing Plaintiffs’ “confidential information.” Plaintiffs sought this ex parte relief even though Mr. Wolfe was at the time less than a half hour away from the courthouse at his home in Randolph, Orange County, Vermont. On February 12, 2019, and in reliance upon Plaintiffs’ one-sided presentation, the Court granted Plaintiffs’ ex parte motion and issued a TRO, which remained in effect until December 26, 2019, as noted below. Upon being served with the suit papers and the TRO, Defendants opposed Plaintiffs’ motion for preliminary injunction and moved to dismiss this litigation pursuant to V.R.C.P. 12(b)(3) and 12(b)(6). The Court denied Defendants’ motion to dismiss on the grounds that Plaintiffs’ allegations met Vermont’s liberal pleading standards and, on July 15, 2019, set an evidentiary hearing on Plaintiffs’ motion for preliminary injunction for August 26, 2019.
  4. 4 of 15 Downs Rachlin Martin PLLC Several weeks later, Plaintiffs moved to continue the hearing on the grounds that their “most appropriate witness,” Luisa Puche, would be unavailable on August 26 and “there was no clear substitute for Ms. Puche.” Given that the TRO, which had been issued back in February 2019, remained in place, Defendants urgently desired to proceed on August 26 and were prepared to do so, and therefore opposed the motion to continue. Following additional submissions in response to the Court’s questions, the Court granted Plaintiffs’ requested continuance, reconvening the August 26 hearing on November 5. The Court held an all-day evidentiary hearing on Plaintiffs’ motion for preliminary injunction on November 5, 2019. Despite the extensive time they had had to prepare,3 and despite the fact that it had been nine (9) months since Mr. Wolfe’s Danish filing (supposedly disclosing Plaintiffs’ “confidential information”), Plaintiffs – through their “most appropriate” and irreplaceable witness Ms. Puche – were unable to identify any harm (much less irreparable harm) they had actually suffered due to the disclosures in Mr. Wolfe’s Danish filing.4 At the conclusion of the hearing, the Court expressed doubt over Plaintiffs’ claim for breach of contract, given that (a) plaintiff Enochian Biosciences, Inc. was not even a party to the CFO Services Agreement, and (b) the alleged “confidential information” at issue clearly was not covered under the CFO Services Agreement’s confidentiality provisions. In view of that observation, Plaintiffs asked the Court for the opportunity to submit additional legal argument on their fiduciary duty 3 In fact, in its written decision on Plaintiffs’ motion, the Court expressly pointed out that “all Parties had ample time to prepare for the evidentiary preliminary injunction hearing.” Dec. 26, 2019 Entry Order, at 2. 4 Nor were Plaintiffs able to show that, prior to the allegedly improper disclosure of “confidential information” in Mr. Wolfe’s Danish filing, Plaintiffs actually considered the disclosed information to be confidential and actually treated it as such.
  5. 5 of 15 Downs Rachlin Martin PLLC and duty of loyalty claims, which claims they had barely mentioned at any point in the case up to that time. Following post-hearing briefing on Plaintiffs’ claims for breach of fiduciary duty and breach of the duty of loyalty, the Court issued an Order on December 26, 2019, denying Plaintiffs’ motion for preliminary injunction and dissolving the previously-issued TRO.5 In its written decision, the Court specifically found that Plaintiffs’ breach of contract claim failed as a matter of fact and law because the “confidential information” at issue was not covered by the clear and unambiguous terms of the CFO Services Agreement. Dec. 26, 2019 Entry Order, at 6. The Court also found, based upon the facts adduced and the applicable law, that Plaintiffs were not likely to succeed on the merits of their fiduciary duty and duty of loyalty claims, and that the other elements for preliminary injunctive relief had not been satisfied. Id. at 6-11. In the course of its ruling, the Court noted its “significant reservations” as to the value of the “confidential information” claimed by Plaintiffs, and at best could only characterize it as “limited confidential information.” Id. at 9. The Court further concluded it could not find that Mr. Wolfe’s “limited disclosure of the limited confidential information . . . in these circumstances was either unfair to Enochian U.S. or a misuse of power,” and instead was in good faith. Id. In the conclusion of its Order denying Plaintiffs’ preliminary injunction and dissolving the TRO, the Court inquired of the parties as to whether this lawsuit should even continue on to a final merits hearing, with discovery to take place in the interim. Plaintiffs responded by taking 5 Notably, despite their prior claims that Ms. Puche was their “most appropriate” and irreplaceable witness – whose schedule led to the postponement of the preliminary injunction hearing until November 5 – Plaintiffs attempted with their post-hearing brief to submit a factual affidavit from a different witness, who had not testified at the hearing – namely, Rene Sindlev, a Director and the Chairman of Enochian Biosciences, Inc.’s Board of Directors. The Court correctly rejected the affidavit as an improper post-hearing attempt to submit evidence that was available at the time of the hearing.
  6. 6 of 15 Downs Rachlin Martin PLLC the position that both discovery and a final merits hearing absolutely were needed, and then on January 16, 2020 moved to alter or amend the Court’s preliminary injunction Order or, alternatively, for permission to take an interlocutory appeal. Defendants opposed the motion and argued instead that, because (a) Plaintiffs’ Verified Complaint sought no remedies beyond injunctive relief, and (b) the Court had ruled based upon the facts and law that Plaintiffs were not entitled to injunctive relief, the case should be dismissed. Plaintiffs sought to prolong the litigation against Defendants and on February 12, 2020 opposed Defendants’ motion to dismiss, arguing that “[a]t this point, Plaintiffs are entitled to conduct discovery and use any evidence obtained through such discovery during a final merits hearing.” Pls. Feb. 12, 2020 Opp., at 4. Plaintiffs further advised the Court that “discovery is contemplated and not yet completed.” Id. at 6. The Court denied all post-hearing motions, noting in pertinent part “the right to discovery in civil matters” (Feb. 20, 2020 Entry Order, at 1), and ordered the parties to submit a discovery schedule, which the parties jointly filed on March 16, 2020. Among other items, the schedule contemplated written fact discovery, expert disclosures, and fact and witness depositions. Three (3) days later, on March 19, Defendants served interrogatories and requests to produce on Plaintiffs.6 Defendants’ detailed discovery requests were carefully crafted to probe in depth (a) Plaintiffs’ alleged “confidential information”; (b) Plaintiffs’ relationship with the person about whom the supposed “confidential information” pertained; (c) Plaintiffs’ actions and efforts (or lack thereof) to designate and keep such information (and other information) “confidential”; (d) the alleged justification for treating the information as “confidential” in the first place; (e) 6 On the other hand, Plaintiffs did not serve any discovery requests on Defendants – nor have Plaintiffs done so to date, despite arguing to the Court on multiple occasions that they needed to conduct discovery.
  7. 7 of 15 Downs Rachlin Martin PLLC Plaintiffs’ actions (or lack thereof) in response to the disclosure of such information in Mr. Wolfe’s Danish lawsuit; and (f) Plaintiffs’ claimed “irreparable harm.” Plaintiffs’ responses to these discovery requests were due April 22. Following the submission of the discovery schedule on March 16 and Defendants’ service of their written discovery requests on March 19, and carrying on into April, the parties communicated regarding potential settlement of this litigation as well as Mr. Wolfe’s pending case in Denmark. On April 7, Plaintiffs made what they claimed was a “best and final offer” to Mr. Wolfe, and threatened at that time to “proceed with discovery as planned” in the event Mr. Wolfe did not agree to their settlement offer.7 On April 10, Mr. Wolfe rejected Plaintiffs’ offer and made a counter-proposal, requesting that Plaintiffs respond no later than April 17. In that communication, Mr. Wolfe made clear that he expected Plaintiffs to respond to Defendants’ discovery requests by the approaching April 22 due date. Then, suddenly, at 9:05 a.m. on April 17 – just five (5) days before their discovery responses were due – Plaintiffs sent an email asking Defendants if they “would be willing to stipulation [sic] to the dismissal of this action, with prejudice, and with each party to bear its own attorneys’ fees, expenses, and costs,” and demanded a response by 2:00 p.m. that same day. (Plaintiffs’ email simply ignored and made no mention of the prior and ongoing exchanges over possible settlement, as if they had never taken place.) When Defendants were unable to respond within Plaintiffs’ arbitrary and unreasonable five-hour deadline, Plaintiffs proceeded to file their present motion for voluntary dismissal, 7 Plaintiffs’ “best and final offer” (a) did not come close to covering the full amount of what Mr. Wolfe is owed – and was expressly promised – by Plaintiffs when he was improperly terminated in January 2019; (b) did not come anywhere near what Mr. Wolfe is entitled to recover in his Danish lawsuit (under the governing law specified in the contract with Mr. Wolfe) for a wrongfully terminated employee; and (c) did not provide anything at all for Mr. Wolfe’s expenses and other damages in defending this lawsuit for more than a year, or for reputational harm the lawsuit has caused to Mr. Wolfe.
  8. 8 of 15 Downs Rachlin Martin PLLC which represents a complete reversal and abandonment of their repeated insistence that they needed to conduct discovery (which they never served) and have a final merits hearing. Plaintiffs now proffer the COVID-19 pandemic as an excuse for suddenly wanting to drop this lawsuit. Notably, not once during any prior communications did Plaintiffs mention or raise any concerns about “the business disruptions and economic uncertainty caused by the COVID-19 pandemic” and the need for Plaintiffs “to focus their resources elsewhere,” as they suddenly now do in their pending motion to dismiss.8 In short, the circumstances leading up to and surrounding Plaintiffs’ abrupt decision to simply walk away and end this litigation readily support the conclusion that Plaintiffs’ true motivation is to avoid responding under oath to Defendants’ discovery requests and having to produce documents. Based upon what has transpired to date, Defendants’ expectation is that the responses to these discovery requests would have revealed that Plaintiffs’ claims regarding the “confidential information” at issue in the case were completely unfounded and that this lawsuit was merely a tactical ploy commenced by Plaintiffs for the sole purpose of giving it settlement leverage over Mr. Wolfe in the Danish lawsuit. Yet now, and without suffering any penalty for what they have done, Plaintiffs want to pretend that this whole contentious, expensive, burdensome, ill-founded, and time-consuming case never happened and that no harm was done to Defendants (or this Court or the public) because of it. 8 The World Health Organization declared the COVID-19 outbreak a Public Health Emergency of International Concern (PHEIC) on January 30, 2020, and then declared it a global pandemic on March 11, 2020 – well over a month before Plaintiffs’ sudden desire to abandon this lawsuit. Prior to April 17, all Plaintiffs said regarding the pandemic was in reference to when the ongoing litigation matters might be resolved in the courts – specifically that “the COVID-19 pandemic will almost certainly lead to delays [in the pending litigation matters between the parties] in both the U.S. and Denmark.”
  9. 9 of 15 Downs Rachlin Martin PLLC It should not be that simple and easy for Plaintiffs. They have wasted fourteen (14) months of this Court’s time, the taxpayers’ funds, and Mr. Wolfe’s time, resources, legal fees, and emotional energy on what so far has proven to be an unfounded, tactical, and cynical legal misadventure. Plaintiffs stretched out this harassing litigation as long as they possibly could before having to make any factual disclosures. They vehemently refused the Court’s prior suggestion of, and Defendants’ prior demand for, dismissal after their complete failure of proof in the preliminary injunction hearing, instead seeking reconsideration or an interlocutory appeal of the Court’s denial of the preliminary injunction. Plaintiffs said they wanted discovery, but never served any. And now that it is no longer convenient, advantageous, or feasible for Plaintiffs to continue this lawsuit, and now that they are on the deadline for responding to discovery seeking the true basis for their claims and the motivation for this lawsuit, they simply want to walk away unscathed. That simply is not fair, just, or appropriate. Finally, a dismissal under the terms requested by Plaintiffs also is unfair and prejudicial to Defendants because it could materially hinder or complicate Defendants’ pursuit of any follow-on claims they have against Plaintiffs with respect to this litigation – such as for malicious prosecution or abuse of process – by creating the risk of unnecessary litigation over whether Plaintiffs’ claims were terminated favorably to Defendants. Issuing a judgment in Defendants’ favor, for the reasons discussed below, is thus a more fair and appropriate disposition of the case. After all, V.R.C.P. 41(a)(3) authorizes the Court to dismiss a case at the plaintiff’s request – which is what Plaintiffs are seeking here – “upon such terms and conditions as the court deems proper.” Allowing Plaintiffs to engage in a fourteen-month long campaign of harassment of Defendants but then suddenly walk away with no consequences the moment Defendants seek discovery from them is not “proper.”
  10. 10 of 15 Downs Rachlin Martin PLLC B. This Court Should Enter Judgment in Favor of Defendants on All Counts in the Verified Complaint. Plaintiffs’ Verified Complaint alleges three causes of action: breach of contract (Count I), breach of fiduciary duty (Count II), and breach of the duty of loyalty (Count III). Fourteen (14) months into this litigation, Plaintiffs have failed to substantiate any of the three counts, and at this point judgment in Defendants’ favor is plainly warranted on each of them. As to Count I, breach of contract based solely upon the CFO Services Agreement, this Court indisputably ruled at the preliminary injunction stage that the claim fails as both a matter of fact and law. Dec. 26, 2019 Entry Order, at 6. And, in fact, in their motion to alter/amend or for permission to appeal, Plaintiffs took no issue with that ruling. Thus, there can be no question that Defendants are entitled to a judgment on Count I.9 As to Count II, breach of fiduciary duty, and Count III, breach of the duty of loyalty, the Court has the authority to rule in Defendants’ favor even though there was no explicit consolidation of the preliminary injunction hearing with a trial on the merits pursuant to Vt. R. Civ. P. 65(b)(2). While formal, advance consolidation of the preliminary injunction hearing and merits hearing might be the “typical” course of action, courts in many circumstances have issued final decisions following preliminary injunction proceedings even where consolidation was not ordered. See, e.g., Berry v. Bean, 796 F.2d 713, 719 (4th Cir. 1986) (reversing grant of preliminary injunction and remanding with directions to dismiss where “precedent dictates a resolution in favor of [defendant], and no proffered evidence could change the result,” such that 9 In addition, given (a) that Plaintiffs’ own CFO Services Agreement required that all disputes arising out of the contract be litigated in Denmark under Danish law; (b) that there was already pending litigation between the parties over the contract in Denmark when Plaintiffs filed this lawsuit here; and (c) Plaintiffs could have raised and litigated the alleged “confidential information” issues in that pending Danish proceeding, it was entirely improper from the outset for Plaintiffs to sue Defendants here alleging breach of contract.
  11. 11 of 15 Downs Rachlin Martin PLLC further consideration on the merits would be “futile” and “a useless gesture”); Libertad v. Welch, 854 F. Supp. 19, 34 (D.P.R. 1993) (dismissal is warranted following preliminary injunction hearing where no material disputes of fact remain, additional discovery would not substantially assist plaintiffs, and law dictates that plaintiffs will not succeed on merits); Martin v. Patterson, 975 So.2d 984, 991-92 (Ala. App. 2007) (dismissal is proper following preliminary injunction hearing “when parties in fact presented their entire cases and no evidence of significance would be forthcoming at trial”); George P. Ballas Buick-GMC, Inc. v. Taylor Buick, Inc., 449 N.E.2d 503, 505, 507 (Ohio App. 1982) (affirming dismissal of case following preliminary injunction hearing where court held extensive hearing and evidence revealed that plaintiff could not show a right to relief and that no conflict of material fact existed to justify a full merits trial); see also Standard Oil Co. of Tex. V. Lopeno Gas Co., 240 F.2d 504, 510 (5th Cir. 1957) (“It is settled beyond controversy that if, at the hearing on an application for preliminary injunction, the evidence shows clearly that the plaintiff has not stated a claim upon which relief can be granted and cannot state such a claim, the court should dismiss the plaintiff’s complaint.”); Illinois High School Ass’n v. GTE Vantage, Inc., 99 F.3d 244, 248 (7th Cir. 1996) (“Not only was the preliminary injunction sought by [plaintiff] rightly denied, but since the suit appears to lack any merit, the district court on remand should enter judgment for the defendant.”). In arguing against Defendants’ motion to dismiss following the injunction decision, Plaintiffs pointed out that the key purpose behind “clear and unambiguous notice” of consolidation is to “ensure that a party has not withheld evidence based upon the mistaken belief that the matter at issue was only a preliminary injunction.” Pls. Feb. 12, 2020 Opp., at 4 (quoting Campbell Inns, Inc. v. Banholzer, Turnure & Co., 148 Vt. 1, 4 (1987)). But in the present case, where injunctive relief was and is the only relief sought by Plaintiffs, they cannot claim that they
  12. 12 of 15 Downs Rachlin Martin PLLC withheld evidence or stopped short of making their strongest possible case at the preliminary injunction hearing. First, Plaintiffs successfully sought to continue the August 26 injunction hearing for the specific reason of having their essential witness, Ms. Puche (for whom, by Plaintiffs’ own averment, there was no substitute), available to testify. Second, the relief sought at the preliminary injunction hearing – i.e., to enjoin Defendants from disclosing Plaintiffs’ “confidential information” – was precisely the same (and only) relief Plaintiffs seek in their Verified Complaint.10 This clearly was known to Plaintiffs from the beginning and, therefore, further amplified the importance of the preliminary injunction hearing. As Plaintiffs’ themselves readily acknowledged, “the only relief Plaintiffs seek is an order enjoining [D]efendants from disclosing their confidential information,” and “Plaintiffs have repeatedly made it clear throughout this litigation that they are seeking an injunction preventing Defendants from disclosing their confidential information.” Pls. Feb. 12, 2020 Opp., at 6-7. In short, Plaintiffs had plenty of time, opportunity, and, most importantly, motivation to put their best foot forward at the preliminary injunction hearing. It is simply inconceivable that Plaintiffs had relevant evidence that they did not introduce at the hearing, and, notably, they have identified no such evidence in the more than five (5) months since the hearing. After all, the alleged disclosure of “confidential information” by Mr. Wolfe and the claimed “irreparable harm” resulting from it were so critical that Plaintiffs felt justified in initially seeking ex parte relief from the Court (despite the fact that Mr. Wolfe was close by and readily available to be heard). If Plaintiffs were now to deny that they put on anything but their absolute best case at the hearing, then they 10 Plaintiffs have never sought to amend their Verified Complaint to seek damages. And the reason is obvious: the testimony of Plaintiffs’ own witness at the November 5 hearing confirmed that Plaintiffs have suffered zero damages.
  13. 13 of 15 Downs Rachlin Martin PLLC essentially would be admitting that the hearing was little more than a waste of the Court’s and Defendants’ time. Along these same lines, the second requirement enunciated by the Vermont Supreme Court in Campbell Inns – i.e., that the parties had a “full opportunity to present their respective cases” – also is satisfied here given the circumstances. The Court held a day-long evidentiary hearing and permitted the parties to submit whatever exhibits they wanted, as well as post- hearing briefing, for the Court’s consideration. And, importantly, this is not a case where Plaintiffs filed their Verified Complaint and then had only a short window of time to prepare for a preliminary injunction hearing with limited information available to them. On the contrary, after filing their case Plaintiffs had nine (9) months to prepare for the hearing, with full knowledge that every issue in the case would be on the table.11 And, after the hearing, Plaintiffs extensively briefed the fiduciary duty and duty of loyalty issues, which the Court found unavailing. See Plaintiffs’ November 19, 2019 (post-hearing) Supplemental Memorandum in Support of Motion for Preliminary Injunction; January 16, 2020 Motion to Alter or Amend Order (i.e., for reconsideration) or for Permission to Appeal; and February 12, 2020 Reply in Support of Motion to Alter or Amend or for Permission to Appeal. At this point, judgment in Defendants’ favor is plainly warranted on each of the three counts in Plaintiffs’ Verified Complaint. C. Conclusion. WHEREFORE, for the foregoing reasons, Defendants respectfully request that this Court: 11 Even so, as noted above, Plaintiffs, by their own choice, have never sought any discovery from Defendants.
  14. 14 of 15 Downs Rachlin Martin PLLC (1) DENY Plaintiffs’ Motion to Dismiss; (2) Enter judgment in Defendants’ favor on Count I (breach of contract) in Plaintiffs’ Verified Complaint; (3) Enter judgment in Defendants’ favor on Count II (breach of fiduciary duty) in Plaintiffs’ Verified Complaint; (4) Enter judgment in Defendants’ favor on Count III (breach of the duty of loyalty) in Plaintiffs’ Verified Complaint; and (5) Award Defendants’ their attorneys’ fees and costs in this action. Dated at Burlington, Vermont this 30th day of April, 2020. CROSSFIELD, INC. and ROBERT R. WOLFE By: ___/s/ Walter E. Judge, Jr.________ Walter E. Judge, Jr. Matthew S. Borick Downs Rachlin Martin PLLC Attorneys for Defendants 199 Main Street P.O. Box 190 Burlington, VT 05402-0190 Phone: (802) 863-2375 wjudge@drm.com mborick@drm.com Attorneys for Defendants cc: Christopher J. Valente, Esq. Michael R. Creta, Esq. David Pocius, Esq.
  15. 15 of 15 Downs Rachlin Martin PLLC DEFENDANTS’ RULE 7(a)(1)(B) CERTIFICATION Pursuant to Rule 7(a)(1)(B) of the Vermont Rules for Public Access to Court Records, undersigned counsel certifies that he has reviewed the foregoing filing, and that the filing contains no nonpublic records under the Vermont Rules for Public Access to Court Records. ___/s/ Matthew S. Borick____________ Matthew S. Borick CERTIFICATE OF SERVICE Pursuant to Rule 5(h) of the Vermont Rules of Civil Procedure, undersigned counsel hereby certifies that a copy of the above document was served on April 30, 2020, via email, on the following attorneys of record in the above-captioned action: Christopher J. Valente, Esq. Michael R. Creta, Esq. K&L GATES LLP State Street Financial Center One Lincoln Street Boston, MA 02111 Phone: 617-261-3100 Fax: 617-261-3175 christopher.valente@klgates.com michael.creta@klgates.com David M. Pocius, Esq. PAUL FRANK + COLLINS P.C. One Church Street P.O. Box 1307 Burlington, VT 05402-1307 Phone: 802-658-2311 Fax: 802-658-0042 dpocius@pfclaw.com ___/s/ Matthew S. Borick____________ Matthew S. Borick 19935018.4