Ferolito v Vultaggio

Ferolito v Vultaggio 2011 NY Slip Op 05426 Decided on June 23, 2011 Appellate Division, First Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and subject to revision before publication in the Official Reports.

Decided on June 23, 2011
Saxe, J.P., Sweeny, Catterson, Freedman, Manzanet-Daniels, JJ.
5419 600396/08 590967/08

[*1]John M. Ferolito, etc., et al. Plaintiffs-Respondents, Arizona Beverage Acquisition, LLC, Plaintiff,

v

Domenick J. Vultaggio, et al., Defendants-Appellants. [And a Third-Party Action]



 
Cadwalader, Wickersham & Taft LLP, New York (Louis M.
Solomon of counsel), for appellants.
Boies, Schiller & Flexner, LLP, New York (David A. Barrett
of counsel), for respondents.

Order and judgment (one paper), New York County (Martin Shulman, J.), entered November 10, 2010, inter alia, declaring that no "Employment Separation Event" has occurred with respect to plaintiff Ferolito, unanimously affirmed, with costs.

The Owners' Agreement defines Employment Separation Event (ESE) as "[t]he voluntary agreement of an Executive to deem himself subject to an [ESE]." The motion court correctly found that this definition presents "a totally subjective standard, to
be defined only by [the executive]" (see e.g. Ghanem v Upchurch, 481 F3d 222, 225 [5th Cir 2007] ["We interpret the phrase for what he deems (to be good and sufficient cause)' as vesting complete discretion in (him) to determine what constitutes good and sufficient cause."]). Ferolito established that no ESE has occurred for him by stating in an affidavit that he had never entered into any voluntary agreement to deem himself subject to an ESE. None of the voluminous evidence the Vultaggio defendants submitted controverts this statement.

Moreover, nothing in the disputed clause connotes an obligation on the part of an executive to participate in management on a daily basis or risk being subject to an ESE. Thus, the evidence of Ferolito's involvement in the company before and after the execution of the agreement does not avail defendants.

Nor did defendants demonstrate that further discovery is warranted (see CPLR 3212[f]; Voluto Ventures, LLC v Jenkens & Gilchrist Parker Chapin LLP, 44 AD3d 557 [2007]).

We have considered defendants' remaining contentions and find them unavailing.

THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: JUNE 23, 2011

CLERK