Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Gorey v. Allion Healthcare Inc.

Other Lower Courts

January 7, 2008

Broughan Gorey, Plaintiff,
v.
Allion Healthcare Inc., Defendant.

Editorial Note:

This case is not published in a printed volume and its disposition appears in a table in the reporter.

COUNSEL

ATTORNEY FOR PLAINTIFF Law Offices of David Schlachter.

ATTORNEY FOR DEFENDANT Nixon Peabody, LLP.

OPINION

Emily Pines, J.

Defendant, Allion Healthcare, Inc ("Allion") moves, by Notice of Motion (motion sequence number 003) for an Order granting such Defendant Summary Judgment, dismissing Plaintiff's Complaint pursuant to CPLR 3212 (b). In the alternative, Defendant moves to dismiss Plaintiff's Complaint pursuant to CPLR 3216 as a result of Defendant's failure to file and serve a Note of Issue within the ninety days as set forth in this Court's Order dated March 1, 2007. Plaintiff, Broughan Gorey ("Gorey") cross-moves, by Notice of Motion, (motion sequence number 004) for an Order granting the Plaintiff, as Counterclaim Defendant, Summary Judgment, dismissing Defendant's Counterclaims pursuant to CPLR 3212(d).

The Complaint and Counterclaims, and thus, the ensuing motions, all arise out of an employment relationship between the Defendant, which provides pharmacy and disease management services to HIV/AIDS patients, and Plaintiff, its former Chief Financial Officer. Essentially, Plaintiff asserts, in his Verified Complaint and in his deposition testimony, that the Defendant breached its Employment Agreement ("Agreement") with him in several ways: 1) failing to provide Plaintiff with the option to purchase 90,000 shares of Common Stock of Allion in accordance with a 1998 stock option plan; 2) failing to permit Plaintiff to participate in an executive bonus plan as well as refusing to develop such plan at all; 3) failing to award Plaintiff a bonus based on his performance during his employment; and 4) failing to award Plaintiff a severance package in accordance with the terms of his Employment Agreement, following his resignation for "good reason". Plaintiff also asserts that Defendant, through its President and its Director, influenced him to accept employment with Defendant based on false promises, in that it lead him to believe that an executive bonus plan was in the process of being developed; that it would be forthcoming; and that such bonus would significantly increase his income; thus, giving rise to Plaintiff's claim for fraud in the inducement.

In its Counterclaims, Defendant asserts that Gorey likewise breached the Agreement and violated the Agreement's post termination restraints by 1) utilizing confidential corporate documents to invite twenty three (23) of Allion's employees, post resignation, to party at his home with representatives of a competitor pharmacy's employees; 2) providing a forum for the competitor to recruit such employees, several of whom shortly thereafter, accepted employment positions with Allion's competitor; and 3) stating to the employees at the party that Allion was in serious financial peril, all of which both solicited Allion's employees to leave such employment and interfered with such employment. The same essential allegations give rise to Defendant Counter-claimant's cause of action for tortious interference with business relations.

In support of its Summary Judgment motion, Allion argues that documentary evidence establishes that Allion complied with all of its obligations under the Agreement. The Employment Agreement requires, in pertinent part, that the employee is entitled to options to purchase 90,000 shares of Common Stock in accordance with Allion's stock option plan; that the options shall have an exercise price to be determined by the Board of Directors and that the options shall vest ratably over three years. Attached to its motion papers, and not countered by Plaintiff, is a June 24, 2002 Board resolution granting Plaintiff, Gorey, the option to purchase 90,000 shares of Allion's common stock (Moran Aff Exh B). The stock option plans attached to Defendant's moving papers all state that exercise of these options must be made within 30 days from termination of employment (Exh I to Moran Affidavit). As CFO, Gorey signed an SEC Form 4 on May 28, 2003, reporting to the Securities and Exchange Commission that he had been granted stock options to purchase 90,000 shares of Allion common stock at $3.50 per share vesting monthly over a period of three years. Allion's 2003 Definitive Proxy Statement, filed June 4, 2003, which plaintiff, as CFO, certified, also states that Allion granted Gorey options to purchase 90,000 shares of its common stock at $3.50 per share during the year ending December 31, 2002 (Moran Aff, Exh D). Plaintiffs response to the same is that he was never provided with an agreement setting forth is option rights; however, this is further belied by a post resignation letter from Allion's President and CEO, Michael Moran, setting forth his continued eligibility to purchase 46,533 shares at $3.50 share until April 19, 2004 (Exh H to Moran Aff).

With regard to his claim for severance, which is permitted under the Agreement, upon an Employee's resignation for "good reason", Allion states that Gorey is ineligible since he had no good cause or reason to terminate the employment relationship as there existed no breach and that he failed to comply with the express provisions of the Agreement. Such states at para 4 (f) (iii) that:

"Good Reason shall mean the occurrence of any of the events described below that continues for, and for which the Company has not cured within thirty (30) days after written notice to the Company thereof from the Employee . . . ."

Included within the definition is "(a)ny material breach of the Company's obligation under this Agreement". Paragraph 14 of the Agreement further provides that any notice required to be given the Company was to be provided to Moran at Allion's offices with a copy to Allion's corporate counsel, Harvey Z. Werblowsky, Esq. As set forth in the record, the letter from Gorey is, according to Allion, merely a resignation; not "notice" with an opportunity to cure and not ever sent to counsel. Thus, Allion asserts that Gorey never complied with the clear, contractual condition precedent to his alleged claim of entitlement to severance pay. In response, Gorey argues that the January 2004 letter not only gives Moran notice by setting forth Gorey's claims; but also states that it does not take effect until 30 days thereafter, to allow the Allion to do exactly what the Employment Agreement contemplated. However, rather than taking any action to cure, Gorey asserts that the Board met and terminated his employment immediately thereafter, thereby, terminating his employment without cause, and giving him the ability to seek severance under the terms of the Agreement. However, Allion states that the Agreement, para, 4 (a) specifically allows that "[a]ny termination of this Agreement shall be effective upon receipt of notice of termination by the non-terminating party".

With regard to the issue of the bonus plan, Allion states that the Agreement makes all bonuses ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.