Calisi v. Unified Financial Services, LLC
232 Ariz. 103
Ariz. Ct. App.2013Background
- Calisi, a CPA, worked for UFS as the sole CPA and was promoted to VP of operations in 2007 before a demotion in 2008.
- Calisi was reassigned as a non-salaried commission-only advisor and then served as tax season coordinator for a $15,000 stipend to be paid via his 401(k).
- Calisi left UFS in January 2009 after disputes over signing documents for a new broker-dealer; UFS alleged he self-eliminated while Calisi contends he was discharged.
- Calisi sued for unpaid commissions and $11,814.85 for tax season coordinator work; UFS counterclaimed for misappropriation of trade secrets related to a Calisi list of clients who moved to him.
- A trial court found unpaid commissions and tax-season pay due (treble damages under A.R.S. 23-355(A)) and awarded UFS $51,566.54 on its trade secrets claim, resulting in a net judgment against Calisi.
- On appeal, the court held UFS failed to prove its customer lists were a protectable trade secret and vacated the trade-secret portion, while affirming unpaid-wage findings and remanding for recalculation of costs and fees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the customer lists constitute a trade secret | Calisi argues no protectable trade secret existed. | UFS contends its customer lists are confidential and protectable as trade secrets. | UFS failed to prove the lists were trade secrets; judgment vacated on trade-secret claim. |
| Whether treble damages were appropriate given a good faith dispute | Calisi contends no good faith dispute existed about wages owed. | UFS argues a reasonable good faith dispute justified withholding. | Court affirmed treble damages, finding no good faith withholding supported by the record. |
| Whether UWM bears liability for Calisi's unpaid wages | Calisi asserted UWM was a liable employer for commissions. | UWM contested liability separate from UFS's wage claim. | Remand directed to enter judgment against UWM for unpaid wages. |
Key Cases Cited
- Enterprise Leasing Co. v. Ehmke, 197 Ariz. 144, 3 P.3d 1064 (Ariz. 1999) (two-part UTSA inquiry; secrecy and effort to maintain secrecy)
- Prudential Ins. Co. of Am. v. Pochiro, 153 Ariz. 368, 736 P.2d 1180 (Ariz. 1987) (policyholder information can be trade secret)
- Morlife, Inc. v. Perry, 66 Cal.Rptr.2d 731 (Cal.App. 1997) (treats durability of information and effort in creating list as trade secret factors)
- Amex Distrib. Co., Inc. v. Mas-can, 150 Ariz. 510, 724 P.2d 596 (Ariz. 1986) (customer information can be trade secret; secrecy and competitive value required)
- Stampede Tool Warehouse, Inc. v. May, 272 Ill. App.3d 580, 651 N.E.2d 209 (Ill. App. 1995) (laborious customer-list development factors for trade secret status)