In a recent settlement, Kenneth Kaufman, a former partner at B2B CFO, admitted to allegations of breach of fiduciary duty in an action brought against him by his former partner. Mr. Kaufman was accused of having used copyrighted intellectual property belonging to his previous employer after leaving the business in 2007. He allegedly used this property at his new entity CFOWise, a competitor of B2B CFO. As part of the terms of the settlement, Mr. Kaufman admitted guilt and agreed to pay $220,000 in damages. Would Mr. Kaufman have been guilty of these allegations in New York?
Under New York business litigation laws, a breach of fiduciary duty may be found when:
- The party allegedly committing the breach was a fiduciary under New York law.
- The fiduciary violated the duties of good faith and loyalty.
- The fiduciary engaged in self-dealing.
- The fiduciary did not place the best interest of the beneficiary above his own self-interest.
Had the allegations against Mr. Kaufman been brought as a New York breach of fiduciary duty claim, the court would have had to find that Mr. Kaufman was in fact a fiduciary. The court would assess whether the relationship between Mr. Kaufman and his former employer or partner called for a greater level of trust than what exists between two strangers conducting business together.
If you suspect that your former employee or business partner engaged in a breach of fiduciary duty under New York law, it is essential that you seek guidance from an experienced professional. These cases are based heavily upon the facts of each individual circumstance. To learn more, contact a New York business litigation attorney today at (888) 497-3410.