736 S.E.2d 886
Va.2013Background
- Lawlor sued ORC for breach of contract, unjust enrichment, wrongful termination, and related relief after ORC terminated him as CEO and chair of the board.
- Three plans/agreements defined change in control with variations; Lawlor claimed a change in control occurred due to a TCP-backed board shift in 2009.
- In May 2009, TCP nominees were elected to ORC's board; the severance agreement was signed May 13, 2009.
- December 2009 board meeting removed Lawlor as CEO but kept him as chair until February 2010; Lawlor resigned January 2010.
- A jury awarded substantial damages on multiple counts; the trial court later awarded $2,131,034.75 in attorneys’ fees.
- ORC appealed on eight assignments, including change in control, jury instruction, alternative severance theory, expert testimony, unjust enrichment, and fee recovery.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Change in control exists as a matter of law? | Lawlor argues there was a change in control under the plans and Severance Agreement. | ORC contends no change in control occurred as a matter of law. | Ambiguity allowed jury submission; not error to deny summary judgment. |
| Jury instruction on drafting party and contra proferentem? | Lawlor contends instruction N was proper given drafting disputes. | ORC argues contra proferentem should not apply under Delaware law. | Instruction given; not reversible error; no substantial mislead. |
| Allowance of Lawlor's alternative severance theory absent change in control? | Severance Agreement language 'are payable' mandatorily guarantees benefits despite no change in control. | Severance Policy is discretionary; agreement does not override discretion. | Ambiguity supported submission of theory; jury could resolve. |
| Admission of damages expert testimony? | Reda was qualified as executive compensation expert; his valuations were admissible as weight, not qualification issues. | Reda admitted no stock-valuation expertise; testimony unreliable for stock value. | Court did not abuse discretion; testimony admissible as expert on compensation. |
| Attorney’s fees award scope under Severance Agreement? | Rule 13 of the Severance Agreement requires paying all reasonable fees incurred in enforcing the agreement. | Fees should be limited to Count III; other counts fall outside the agreement scope. | Trial court erred in awarding fees for non-Severance Agreement claims; remanded for recalculation. |
Key Cases Cited
- Greater Richmond Civic Recreation, Inc. v. A.H. Ewing's Sons, Inc., 200 Va. 593 (1959) (ambiguity when reasonable people differ; jury submission allowed)
- Lockheed Information Management Systems Co. v. Maximus, Inc., 259 Va. 92 (2000) (expert qualification; weight goes to cross-examination for valuation)
- CNH America LLC v. Smith, 281 Va. 60 (2011) (abuse of discretion in admitting expert testimony; qualification standard)
- Ulloa v. QSP, Inc., 271 Va. 72 (2006) (prevailing party concept; scope of fee shifting under contract)
- Owens-Illinois, Inc. v. Thomas Baker Real Estate, Ltd., 237 Va. 649 (1989) (law of the case; instructions issued without objection bind parties)
- Preferred Sys. Solutions, Inc. v. GP Consulting, LLC, 284 Va. 382 (2012) (contract interpretation; de novo review of legal questions)