Estate of Accurso v. Infra-Red Servs., Inc.

ESTATE OF PETER ACCURSO, Appellant in 18-1583 v. INFRA-RED SERVICES, INC.; ROOFING DYNAMICS GROUP, LLC;

ROOFING DYNAMICS, INC., BRIAN LAND; AUDREY STREIN

ESTATE OF PETER ACCURSO v. INFRA-RED SERVICES, INC.; ROOFING DYNAMICS GROUP, LLC;

ROOFING DYNAMICS, INC., BRIAN LAND; AUDREY STREIN, Appellants in 18-1607

No. 18-1583

No. 18-1607

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT

Argued October 23, 2019

February 20, 2020

NOT PRECEDENTIAL

On Appeal from the United States District Court for the Eastern District of Pennsylvania

(D.C. Civ. No. 2-13-cv-07509)

District Judge: Honorable Gene E. K. Pratter

BEFORE: GREENAWAY, JR., PORTER, and GREENBERG, Circuit Judges.

Eric G. Marttila

High Swartz

116 East Court Street

Doylestown, PA 18901

James B. Shrimp [ARGUED]

High Swartz

40 East Airy Street

Norristown, PA 19404

Attorneys for Appellant in 18-1583

Todd M. Mosser [ARGUED]

Suite 801

211 North 13th Street

Philadelphia, PA 19107

Attorney for Appellants in 18-1607

OPINION^*

GREENAWAY, JR., Circuit Judge.

We address today a recurrent issue before our Court, whether a litigant is an employee or independent contractor. As would appear logical, the answer is nuanced. Indeed, now after trial, both Plaintiff and Defendants appeal the denial of post-trial motions to vacate verdicts unfavorable to the respective parties. Most prominent is Defendants' appeal seeking to re-examine the question of whether the District Court erred in finding, on summary judgment, that Plaintiff was Defendants' employee. For the following reasons, we will affirm the District Court in part, and reverse and remand for determination of Plaintiff's attorneys' fees under Pennsylvania's Wage Payment and Collection Law.

I. BACKGROUND

A. Factual Background

Defendants-Appellees/Cross-Appellants are Brian Land, Audrey Strein, and the three roofing companies they own and operate (collectively, "Defendants"). In September 2004, Plaintiff-Appellant/Cross-Appellee Peter Accurso signed an agreement entitled "independent contractor agreement" with Defendants.¹ The agreement provided that Accurso would market and sell Defendants' roofing services within a set territory, defined by telephone area codes. In return Accurso would receive "fifty percent of all commissions or income" from leads he generated within his territory. App. 207. The agreement had a four-year term, and would automatically renew every two years, "until canceled by either party upon written notice to the other party."

Over the course of Accurso's employment, Land had suspected Accurso of diverting business opportunities away from Defendants. As a result, Land requested that Accurso undergo polygraph examinations on two separate occasions. On January 4, 2012, Defendants' legal counsel provided Accurso with a "Notice of Immediate Termination." The reasons for termination included diverting business opportunities from Defendants as well as giving less than 24 hours' notice before taking a week-long vacation in December 2011. The Notice also stated the amount Accurso would be paid for his prior services, and it directed Accurso to return all trade secrets and refrain from contacting certain customers.

B. Procedural Background

Accurso brought seven claims against Defendants: (1) violation of the Employee Polygraph Protection Act ("EPPA"); (2) breach of contract; (3) intentional interference with contractual relations (against Land and Strein only); (4) violation of Pennsylvania's Wage Payment and Collection Law ("WPCL"); (5) unjust enrichment; (6) intentional infliction of emotional distress; and (7) civil conspiracy. Defendants filed counterclaims against Accurso for: (1) breach of contract; (2) breach of fiduciary duty; (3) fraudulent misrepresentation; (4) intentional interference with contractual relations; and (5) misappropriation of trade secrets under the Pennsylvania Uniform Trade Secrets Act ("PUTSA").

The District Court dismissed Accurso's unjust enrichment and intentional infliction of emotional distress claims and later entered summary judgment for Defendants on Accurso's claim for interference with contractual relations against Land and Strein as well as Accurso's claim for civil conspiracy.² However, it denied summary judgment to Defendants on Accurso's EPPA, breach of contract, and WPCL claims. Regarding the WPCL claim, the District Court rejected Defendants' argument that Accurso was precluded from recovering under the WPCL because he was an independent contractor. The District Court determined, as a matter of law, that Accurso was Defendants' employee. Accurso's remaining claims went to trial along with Defendants'counterclaims for breach of contract, breach of fiduciary duty, fraudulent misrepresentation, intentional interference with contractual relations, and misappropriation of trade secrets under PUTSA.

After a six-day trial, the jury returned a verdict for Accurso on the WPCL claim and awarded Accurso $51,400, but found Defendants had not violated the EPPA. The jury also determined Accurso had materially breached the agreement. The jury awarded Defendants $13,000 on their breach of contract counterclaim. Additionally, the jury returned a verdict for Defendants on the PUTSA claim and assessed Accurso $63,000 in damages. The jury found in favor of Defendants on the breach of fiduciary duty claim, fraudulent misrepresentation claim, and intentional interference with contractional relations claim, awarding Defendants $37,606, $1, and $1, respectively.

Post-trial, Accurso filed a motion for attorneys' fees, liquidated damages, costs, and pre-judgment interest, as well as a motion for judgment as a matter of law. In the alternative, he moved for a new trial or to alter and amend judgment, seeking to overturn the jury's verdict against him as to his EPPA claim and Defendants' counterclaims for breach of contract, breach of fiduciary duty, fraudulent misrepresentation, intentional interference with contractual relations, and misappropriation of trade secrets.

Defendants also filed post-trial motions for attorneys' fees, exemplary damages, costs, and pre-judgment interest, to alter judgment, and for judgment as a matter of law on the WPCL claim. On February 16, 2018, the District Court issued a final order denying all of the post-trial motions.

Accurso now appeals the denial of his motion for judgment as a matter of law, or, in the alternative, for a new trial or to alter and amend judgment as to his EPPA claim and Defendants' PUTSA counterclaim. He also appeals the denial of attorneys' fees on the WPCL claim. Defendants cross-appeal the following: (1) the denial of their motion for judgment as a matter of law on the WPCL claim; (2) the denial of their motion for attorneys' fees, exemplary damages, costs, and interest; and (3) the denial of their motion seeking to "mold" the judgment.

On this appeal and cross-appeal we review two orders: (1) the District Court's August 10, 2015 order entered on Defendants' motion for summary judgment denying that motion on Accurso's WPCL claim, Accurso v. Infra-Red Servs., Inc., 119 F. Supp. 3d 316, 330 (E.D. Pa. 2015), and an order entered on post-trial motions, Accurso v. Infra-Red Servs., Inc., No. 13-7509, 2018 WL 924985 (E.D. Pa. Feb. 16, 2018).

II. JURISDICTION

The District Court had jurisdiction over this matter pursuant to 28 U.S.C. § 1331 and supplemental jurisdiction was proper pursuant to 28 U.S.C. § 1367. This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1291, which authorizes appeals from final decisions of the District Court. Selkridge v. United of Omaha Life Ins. Co., 360 F.3d 155, 160 (3d Cir. 2004).

III. STANDARD OF REVIEW

This Court exercises "plenary review of an order granting or denying a motion for judgment as a matter of law[.]" Lightning Lube, Inc. v. Witco Corp., 4 F.3d 1153, 1166 (3d Cir. 1993).

In reviewing the District Court's denial of a motion for a new trial, we ask whether the District Court abused its discretion. See Starceski v. Westinghouse Elec. Corp., 54 F.3d 1089, 1095 (3d Cir. 1995). We also review the denial of motions to alter or amend a judgment filed pursuant to Fed. R. Civ. P. 59(e) for abuse of discretion. Max's Seafood Cafe ex rel. Lou-Ann, Inc. v. Quinteros, 176 F.3d 669, 673 (3d Cir. 1999).

IV. DISCUSSION

The parties each raise three issues on appeal. Accurso seeks an award of costs and fees on his WPCL claim, and appeals the District Court's denial of his post-trial motion challenging the jury's verdict rejecting his EPPA claim and its verdict in favor of Defendants on the PUTSA claim. Defendants challenge the District Court's: (1) denial of summary judgment on the WPCL claim, (2) denial of attorneys' fees and punitive damages on its PUTSA claim, and (3) refusal to "mold" the verdict.

For the following reasons, we will affirm the District Court's denial of both Accurso's and Defendants' post-trial motions as to all claims except Accurso's request for attorneys' fees on the WPCL claim, which we reverse and remand to the District Court for further consideration, in accordance with this opinion.

A. Defendants' Post-Trial Motion on WPCL Verdict and Accurso's Post-Trial Motion for WPCL Attorneys' Fees

Defendants raise two issues regarding the WPCL claim. First, they argue the District Court should have entered summary judgment in their favor on Accurso's WPCLclaim because Accurso was an independent contractor. Second, Defendants contend that Accurso's compensation was not "earned" according to the WPCL, and, as such, Accurso is precluded from recovering under the WPCL. We will provide background of the WPCL and then proceed to review and affirm the District Court's order denying summary judgment to Defendants on Accurso's WPCL claim. We also find there was sufficient evidence for the jury to have awarded a verdict in favor of Accurso on the WPCL claim.

1.

Pennsylvania's WPCL provides:

Whenever an employer separates an employee from payroll, or whenever an employee quits or resigns his employment, the wages or

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