Amini LLC recently obtained a favorable decision from the Hon. Andrea Masley (New York State Supreme Court, Commercial Division) dismissing most of BDO USA’s claims against our clients, who are former employees. BDO alleged our clients breached their respective management contracts by misusing confidential information and engaging in unauthorized side work.
The court granted summary judgment to our clients on the complaint’s central allegations that they had misused confidential information from BDO data analytics projects, which were unsupported by any evidence. The court also concluded that BDO had offered no evidence of actual damages and denied its request on summary judgement to disgorge our clients’ wages over a five-year period allegedly as faithless servants.
A highlight of the decision was the court’s finding that BDO is barred from seeking any of the $800,000 in liquidated damages under the management contracts because BDO failed to provide evidence that it had incurred any actual damages. This decision is a reminder that liquidated damages provisions cannot be exploited as penalties or to generate windfalls, and parties should be discouraged from bringing lawsuits when they have suffered no harm.