AMERISERV FINANCIAL, INC. v. BABICH
3:23-cv-00117
| W.D. Pa. | Jan 19, 2024Background
- Jack Babich was a Senior Vice President for Human Resources at Ameriserv Financial, Inc. until his termination on December 31, 2020.
- Ameriserv and Babich entered into a Severance Agreement requiring Babich to keep Ameriserv's confidential information private and to refrain from disparaging the company or its directors.
- Ameriserv alleges that Babich breached this agreement by sharing confidential company and personnel information with Driver Opportunity Partners I, L.P., a shareholder engaged in contentious actions against Ameriserv.
- Driver allegedly used information from Babich to support litigation and make shareholder demands against Ameriserv.
- Ameriserv sued Babich for breach of contract, seeking damages related to severance paid, litigation expenses, and harm from the disclosures and disparagement.
- Babich filed a motion to dismiss the complaint, arguing the claims were vague and unsupported, and that no agreement was sufficiently pleaded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Existence of Contract | Sufficient facts alleged to show contract | Contract not attached or quoted; not proven | Existence plausibly pleaded |
| Breach of Contract | Babich disclosed confidential info, disparaged | Allegations are vague and non-specific | Facts sufficient at this stage |
| Damages | Suffered economic harm and other damages | Not specifically challenged at this stage | Damages plausibly alleged |
| Need to Attach Contract | Not required under federal pleadings rules | Attachment is necessary to support claim | Not necessary to attach |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (sets standard for facial plausibility in federal pleadings)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (explains plausibility requirement and analysis of pleadings)
- U.S. Express Lines Ltd. v. Higgins, 281 F.3d 383 (3d Cir. 2002) (describes motion to dismiss review standard)
- Frederico v. Home Depot, 507 F.3d 188 (3d Cir. 2007) (sets out elements of a breach of contract claim)
- Burton v. Teleflex Inc., 707 F.3d 417 (3d Cir. 2013) (reaffirms Pennsylvania law on breach of contract)