Barufaldi v. Ocean City
206 Md. App. 282
| Md. Ct. Spec. App. | 2012Background
- Barufaldi sued the Ocean City Chamber of Commerce in 2008 for breach of contract and WPCL violations over incentive-based compensation.
- A jury found in Barufaldi's favor on contract and WPCL claims, with $60,000 in contract damages and WPCL liability.
- Barufaldi moved for WPCL attorneys’ fees and costs; the circuit court denied the motion, and this denial was reversed on appeal in Barufaldi I, which remanded for further proceedings.
- On remand, Barufaldi filed a supplemental motion for fees; the Chamber urged ERISA-style factors and cited its financial condition to oppose a fee award.
- The circuit court denied the supplemental fee request, applying ERISA factors and emphasizing lack of bad faith and defendant’s inability to pay.
- This Court reverses, ruling that ERISA factors are inappropriate for WPCL fee awards and remands for a liberal exercise of discretion consistent with WPCL’s remedial purpose.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was the WPCL fee decision properly discretionary? | Barufaldi: WPCL fee awards follow liberal discretion per Friolo I. | Chamber: ERISA factors may guide discretion due to lack of Maryland WPCL factors. | No; ERISA factors inappropriate, remand for proper WPCL discretion. |
| Does WPCL create a presumption in favor of fees when wages were withheld not in a bona fide dispute? | Barufaldi: there is a presumptive entitlement to fees per Friolo I/Hensley line of reasoning. | Chamber: no statutory presumption; discretion rests with the court. | No presumption; discretion remains but should be liberal and remedial. |
| Can a defendant's inability to pay be a controlling factor in denying WPCL fees? | Barufaldi: defendant’s ability to pay should not defeat fee recovery; focus on remedial purpose. | Chamber: financial condition is a relevant consideration under ERISA-like analysis. | Inability to pay is not a relevant factor; court should not condition fees on financial hardship. |
Key Cases Cited
- Friolo v. Frankel, 373 Md. 501 (Md. 2003) (remedial WPCL purpose; discretion to award fees liberal but not automatic)
- Barufaldi I, 196 Md. App. 1 (Md. Ct. App. 2010) (vacated denial of fees; remanded for proper consideration)
- Programm ers’ Consortium, Inc. v. Clark, 409 Md. 548 (Md. 2009) (jury question on bona fide dispute; limits court’s second-guessing)
- Hensley v. Eckerhart, 461 U.S. 424 (Sup. Ct. 1983) (presumptive standard for fee awards in civil rights actions)
- Malamis v. Stein, 69 Md. App. 221 (Md. Ct. App. 1986) (preservation of discretion; no automatic fee presumption)
- Battaglia v. Clinical Perfusionists, Inc., 338 Md. 352 (Md. 1995) (purpose of WPCL fee-shifting is to encourage payment of back wages)