324 So.3d 529
Fla. Dist. Ct. App.2021Background
- Passover FB, Inc. was a closely held corporation formed in 2010 with two 50% shareholders: Harry Taubenfeld (president until late 2017) and Jonathan Lasko (vice‑president). No bylaws, shareholder agreement, or elected board existed.
- Around December 1, 2017, Jonathan allegedly assumed sole operational control of Passover FB; members of the Lasko family formed Lasko Getaways, LLC contemporaneously.
- Taubenfeld alleges the Laskos diverted Passover FB assets and business (including client relationships, websites, five tractor‑trailers and contents, contracts, and revenues) to Lasko Getaways and excluded him from management.
- Taubenfeld filed a derivative action on behalf of Passover FB: Count 1 (breach of fiduciary duty against Jonathan), Counts 2–4 (aiding and abetting breach against Sam, Arlene, Avi), and Count 5 (conversion against Lasko Getaways). The Second Amended Complaint also included an aiding‑and‑abetting‑conversion claim.
- The circuit court dismissed the Fourth Amended Complaint in full (and dismissed the aiding‑and‑abetting‑conversion claim with prejudice), reasoning pleading defects and that some alleged converted items were not cognizable.
- The Fourth District Court of Appeal reversed in part, holding the pleadings adequately alleged breach of fiduciary duty, aiding and abetting breach, and conversion as to certain assets, and that Florida recognizes aiding‑and‑abetting liability for conversion claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Jonathan breached fiduciary duties as an officer by diverting company assets | Jonathan, as the operating officer, usurped control and diverted Passover FB assets and business to Lasko Getaways, damaging the corporation | Allegations insufficiently specific; alternatively contends Jonathan was a former officer free to compete (not raised below) | Reversed dismissal: complaint pleaded existence of fiduciary duty, breach (duty of loyalty/care), and resulting corporate damage |
| Whether Sam/Arlene/Avi can be liable for aiding and abetting Jonathan’s breach | Each Lasko knowingly assisted/encouraged Jonathan’s diversion (e.g., removing trailers, soliciting clients, endorsing checks) | Alleged facts were commingled, conclusory, and failed to show substantial assistance or specific knowledge | Reversed dismissal: separate counts and factual allegations alleged knowledge and substantial assistance for each defendant |
| Whether conversion was sufficiently pleaded against Lasko Getaways | Lasko Getaways wrongfully asserted dominion over Passover FB tangible and intangible assets (e.g., trailers, websites, intellectual property, goodwill) | Complaint overbroad; goodwill, business relationships, and cash are not adequately pleaded subjects of conversion | Reversed dismissal in part: conversion adequately pleaded as to specific tangible assets and certain intangible business interests (but dismissal affirmed as to cash, trade‑secret misappropriation, and business/contractual relationships) |
| Whether Florida recognizes a claim for aiding and abetting conversion | Aiding and abetting conversion is actionable where the aider knew of the conversion and gave substantial assistance | Trial court held Florida does not recognize aiding‑and‑abetting conversion | Reversed: Florida permits aiding‑and‑abetting liability for conversion (consistent with aiding‑and‑abetting for other common‑law torts) |
Key Cases Cited
- Gracey v. Eaker, 837 So.2d 348 (Fla. 2002) (elements of breach of fiduciary duty)
- Flight Equip. & Eng’g Corp. v. Shelton, 103 So.2d 615 (Fla. 1958) (officers liable for corporate breaches of trust)
- Cede & Co. v. Technicolor, Inc., 634 A.2d 345 (Del. 1993) (duty of loyalty and corporate opportunity principles)
- In re Walt Disney Co. Derivative Litig., 907 A.2d 693 (Del. Ch. 2005) (duty of care standard and overlap with loyalty concerns)
- Stone ex rel. AmSouth Bancorporation v. Ritter, 911 A.2d 362 (Del. 2006) (good faith is subsumed under duty of loyalty)
- Fonseca v. Taverna Imps., Inc., 212 So.3d 431 (Fla. 3d DCA 2017) (elements of aiding and abetting breach of fiduciary duty)
- Warshall v. Price, 629 So.2d 903 (Fla. 4th DCA 1993) (conversion of confidential lists and intangible business interests)
- In re Estate of Corbin, 391 So.2d 731 (Fla. 3d DCA 1980) (conversion may reach intangible business interests and goodwill)
- Belford Trucking Co. v. Zagar, 243 So.2d 646 (Fla. 4th DCA 1970) (money convertible only if specifically identifiable)