American Rag v. Haralambus CA2/5

I. INTRODUCTION

Plaintiff, American Rag Cie, LLC, and defendant, Harry Haralambus, appeal from a judgment and an order following a bench trial. Plaintiff filed a complaint against defendant alleging fiduciary duty and contract breach, declaratory relief and unjust enrichment claims. Defendant filed a cross-complaint against plaintiff and cross- defendants, Larry Russ and Mark Werts, alleging several claims, including fiduciary duty and contract breach and fraud. Mr. Russ, Mr. Werts and defendant are all owners of plaintiff and other businesses. A bench trial was held to first resolve the declaratory relief and fiduciary duty breach claims because they were equitable in nature. At the conclusion of the bench trial, the trial court entered judgment against all the parties’ causes of action except for the declaratory relief claim. The trial court determined an oral contract existed between plaintiff and defendant. The trial court: ruled plaintiff agreed to pay defendant a percentage of royalties received by it from an April 1, 2003 license agreement; calculated a monetary judgment in favor of defendant for contract breach based on royalties received; and dismissed all the remaining…