Breach of Contract and Business Torts

— Leventhal, Sutton & Gornstein et al. vs. Nationwide and Mand-Marblestone Group (ED.Pa.). Mr. Clayton represented a law firm, its 401(k) plan, and a plan beneficiary in a federal lawsuit alleging that the plan’s service providers had breached their fiduciary duties under ERISA relative to cyber-security.  Mr. Clayton defeated both defendants’ motions to dismiss the ERISA claims.  He also prevailed on his own motions to strike defendants’ affirmative defenses alleging contributory negligence by his clients, as well as striking defendants’ third-party complaint seeking proportionate liability relative to the cyber-thieves.  Next, he aggressively pursued discovery and won related motions to compel.  The case then resolved via settlement to his clients’ satisfaction.

— Coim v. Polycoat and Chang (D.N.J.). Mr. Clayton was engaged by a downstream employer to defend its employee in a trade-secrets case brought by a prior employer. Following his cross-examination of the plaintiff’s CEO at a preliminary injunction hearing, the parties adjourned to discuss settlement, and then agreed to resolve the matter without any payment from Mr. Clayton’s client.

— Ortlieb v. Hudson United Bank (E.D.Pa.). Obtained an award of summary judgment on behalf of the defendant bank that was featured as the front-page lead story in The Legal Intelligencer and subsequently affirmed by the Third Circuit.

— Rokom v. Bankers Trust (Pa. Super. Ct.). Authored the appellate brief that led the Pennsylvania Superior Court to overturn a $13 million trial verdict against a bank.

— Mobility v. Michael Baker Corp. (Phila. Common Pleas). Obtained an award of summary judgment (and then appellate affirmance) on behalf of the defendant corporation in a business dispute in which the plaintiff alleged $20 million in damages for tortious interference.

— Clark Resources, Inc. v. Verizon Business Network Services, Inc. (M.D.Pa.). Represented the defendant telecommunications provider in a case in which the plaintiff claimed lost profits arising from the alleged breach of a subcontract. Mr. Clayton removed the case to federal court and, later, prevailed on a motion for summary judgment. Chief Judge Kane granted the motion, holding that (i) an early flow-down agreement between the parties incorporated certain provisions of the prime contract that barred the plaintiff’s claims, and (ii) the plaintiff had failed to establish that the defendant’s employee at issue had either the actual or apparent authority to contractually bind the defendant.

— Seiples v. AAA Mid-Atlantic (Phila. Common Pleas). Represented the defendant automobile association in a two-week jury trial brought by an independent towing contractor for breach of contract. The jury found in favor of the plaintiff on liability but awarded much lower damages than claimed following testimony from Mr. Clayton’s damages expert.

— Capewell v. Ameriprise Financial and GunnAllen (FINRA / D.N.J.). Represented a group of 22 investors who were the victims of a Ponzi scheme run by their investment broker. After a multi-week arbitration hearing, Mr. Clayton obtained a verdict against both of the broker’s employers, holding them jointly and severally liable for investor losses plus interest — even as to funds the broker took many years after leaving his first employer. After that verdict, the defendant promptly settled a related federal-court action.

— Fiduciary Dispute. Represented a large third-party claims administrator in a protracted arbitration involving contractual and fiduciary claims arising from the administrator’s alleged mishandling of client funds.

—Defense of Client Malpractice Suit Against Major Law Firm. Mr. Clayton successfully represented an AmLaw 50 law firm in defending an arbitration proceeding brought by a former client of that firm alleging malpractice.

Shareholder, Partnership and Derivative Actions

— Reilly and Infradapt LLC v. Haddad (Philadelphia and Lehigh County Common Pleas). Representing a 50% owner of an information-technology company, Mr. Clayton brought shareholder-oppression, derivative and other claims, and sought a preliminary injunction against the other owner. Following a countersuit, preliminary injunction hearing and multiple mediation sessions, the parties reached a confidential settlement agreement to the satisfaction of Mr. Clayton’s client.

— Deal v. Waldman (Phila. Common Pleas). Represented a minority shareholder whose stock was seized via a corporate freeze-out initiated by majority shareholders, resulting in a substantial settlement for Mr. Clayton’s client shortly after filing a complaint.

— Corporate Governance Litigation (D.N.J). Engaged by a large member organization after one of its executives sued an outside vendor owned by other executives of the same organization. Mr. Clayton formed an independent board committee to manage all matters involving the vendor, and then prepared a complaint-in-intervention against the vendor. As preliminary injunction deadlines advanced, the parties engaged in intensive negotiations that resulted not only in settlement agreements involving eight distinct parties, but also a new business agreement between the organization and its vendor on improved terms that were then unanimously approved by all the members of the organization.

— Merger of Harleysville Mutual / Nationwide Mutual (Phila. Common Pleas). Represented an independent committee of the Harleysville board that was charged with deciding how to respond to derivative lawsuits alleging that a proposed merger was unfair to policyholders.  After investigation, the committee issued a written report finding that the company’s directors had fulfilled their fiduciary duties, and, accordingly, filed a motion to dismiss the derivative claims.

— Bogle v. InterStateNet Bank (N.J. state court). Represented the COO of a bank in a dispute among its governing officers – involving claims for fraud, defamation, wrongful termination and breach of contract – that resulted in a substantial settlement as Mr. Clayton was preparing to pick a jury.

— Derivative Action Analysis. Represented a bank Special Litigation Committee that was tasked with determining (under Cuker and the ALI principles) whether the bank should pursue a derivative action on the basis of claims alleged by a shareholder.

— Representation of Corporation and Majority Shareholders In Defense of NJ Oppression Claim By Terminated Minority Shareholder. Mr. Clayton was engaged to represent a medical practice and its two majority shareholder doctors after a minority shareholder doctor filed a complaint and preliminary injunction motion immediately following his termination. Mr. Clayton succeeded in defeating the plaintiff’s motion following a preliminary injunction hearing, and instead obtained affirmative injunctive relief in favor of his own clients. He then continued to handle the litigation through the pleadings, discovery and mediation. During the course of the proceedings, he defeated the plaintiff’s summary eviction action, successfully prosecuted a motion for contempt against the plaintiff, and also succeeded in consolidating three additional lawsuits the plaintiff had filed in another county. As the matter approached trial, though, the two majority shareholders he represented decided to part business ways. Accordingly, Mr. Clayton first obtained separate counsel for each client individually, and then withdrew from the representation on conflict grounds. Thereafter, the matter concluded with a verdict in favor of Mr. Clayton’s clients and against the minority shareholder.

— Martin Brown and Brown & Thomas LLC v. Sharonn Thomas Pope (Cam. Cty. NJ, No. 2368-16). Mr. Clayton was engaged to represent a majority shareholder and his company after one of the partners left the company, taking clients and employees with her. Mr. Clayton brought suit for contractual and tort claims, and ultimately obtained an award in court-annexed arbitration in favor of his clients on all claims in the approximate amount of $725,000. When the defendant declared bankruptcy, Mr. Clayton successfully petitioned the Bankruptcy Court to annul the automatic stay and validate the arbitral award. Once the Bankruptcy Court had lifted the stay, the State Court granted Mr. Clayton’s motion to confirm the arbitral award, and entered it as a final judgment in favor of Mr. Clayton’s clients on all claims.

— CEO vs. Employer & Majority Shareholders. Represented a Chief Executive Officer who had founded a company in a dispute following his termination (and purported share re-purchase) by the company’s majority shareholders. After initially arranging for an arbitration agreement and mediation, Mr. Clayton was able to negotiate a prompt pre-litigation settlement (to his client’s satisfaction) that included compensation, an agreed buyout price for the CEO’s shares, and the elimination of his prior non-compete restrictions.  There was never any public litigation.

Class Action Defense

— Alfa v. AAA Mid-Atlantic Inc. (Phila Common Pleas). Represented an automobile club in this breach-of-contract class action brought by Pennsylvania towing contractors. Mr. Clayton defended the litigation in the trial and appellate courts; counseled the client regarding steps to limit its exposure; and, ultimately, obtained final judicial approval of a class-wide settlement following a fairness hearing.

— Hensley v. Computer Sciences Corp., et. al. (Ark. state court). Represented several insurance companies sued in an Arkansas class action based on allegations of underpaying claims.

— Kaymak v. AAA Mid-Atlantic Inc., Civ. No. 10-6532 (E.D.P.A.). Represented an automobile club in this class action brought by a former member who alleged that AAAMA had “backdated” the start date of her renewal membership to the prior year’s expiration date and therefore, she claimed, wrongly deprived her of 16 days’ worth of membership benefits. Mr. Clayton responded with a motion to dismiss for lack of standing. Following discovery and a bench trial, the Court found that the plaintiff lacked standing because (a) she had not demonstrated any actual need for member services during the 16-day period at issue, and (b) AAAMA had shown that such services would have been available to her during that time period anyway pursuant to its “grace period” policy of servicing recently lapsed members. The matter was dismissed with prejudice and affirmed on appeal to the Third Circuit.

— Medical Mutual of Ohio v. GSK (E.D.Pa.). Represented a health insurer in an antitrust lawsuit against a pharmaceutical company for allegedly extending its patent monopoly improperly on the sale of its prescription drugs.

— In re: Fen-Phen / In re: Paxil Class Actions (E.D.Pa.). Represented numerous health insurers in successfully objecting to proposed settlements at fairness hearings in these two distinct class actions.

— Engle v. Philip Morris (Fl. state court). Served on the trial team representing Philip Morris in a year-long product-liability class action jury trial followed by appeals.

— Tylka v. Gerber (N.D. Ill. No. 96-1647). Served on the team representing a manufacturer in defending against false-advertising claims arising from the sale of baby food.

— In re Baycol (MDL No. 1431). Served on the team representing a pharmaceutical company in a number of related product-liability suits arising from the sale of a statin.

Other Significant Matters

— Silberstein v. Philadelphia Newspapers, Inc. (Philadelphia Common Pleas). Represented a Philadelphia daily newspaper in defending a defamation case that settled partway through trial.

— Appel v. HBO and Comcast (Phila. Common Pleas). Represented two cable television broadcasters in defending against claims for invasion of privacy arising from the use of plaintiff’s image in a television series.

— Fuentes v. Wagner (E.D.Pa.). Represented a prisoner as court-appointed counsel in a two-week civil rights jury trial followed by appeals.

Appeals

Many of the matters that Mr. Clayton has handled over the years have generated appeals to both state and federal courts. He has also been engaged expressly for the purpose of handling appeal. He has, in fact, lost an appeal only once, in connection with a court-assigned pro bono matter dating from 1997.