Facts

Plaintiff Michael Palumbo sued defendants Jon Waterman and Dan Yomtobian to enforce their oral agreement to pay him 25% of the profits from selling the property at 911 Tione Road in Bel Air, California. Defendants and entities they controlled bought the Tione property to develop and sell it for a profit. Palumbo also sued Waterman and Yomtobian for fraud, claiming they defrauded him into providing services to the Tione property, knowing they never intended to pay him.

After Palumbo sued Waterman and Yomtobian, their companies, JW Capital, Yom Investments, and Tione Residence, LLC, counter-sued Palumbo, claiming he stole $1,840,000 in monies from Tione Residence LLC.

PLAINTIFF'S CONTENTIONS: Palumbo, Waterman, Yomtobian, and their entities bought the Tione property to develop and sell it for a profit. Palumbo claimed that defendants entered into an oral agreement to pay him 25% of the profits from selling the Tione property. Palumbo also contended that he was entitled to recover the reasonable value of his services to the Tione property at the request of Waterman and Yomtobian. Palumbo also contended that defendants defrauded him into providing services to the Tione property, knowing they never intended to pay him.

DEFENDANT'S CONTENTIONS: Waterman and Yomtobian denied they agreed to pay Palumbo a share of the Tione property profits. Waterman and Yomtobian claimed that six written agreements barred Palumbo's oral contract claim.

Waterman and Yomtobian and their companies, JW Capital LLC, Yom Investments LLC, and Tione Residence, LLC, filed a cross-complaint against Palumbo, claiming he stole $1,840,000 of monies from Tione Residence LLC. The cross-complaint asserted claims for breach of fiduciary duty, breach of contract, conversion, and unjust enrichment. The cross-complaint alleged that Palumbo misappropriated funds from Tione and was vicariously liable for Palumbo/Belson Management LLC's ("PBM") conduct as its member and as PBM's alter ego.

Settlement Discussions

During pre-trial settlement discussions, defendants offered to settle for $250,000. During the trial, defendants demanded that Palumbo pay them $100,000 and give them a complete release.

Damages

Plaintiff sought damages for breach of contract and fraud, and punitive damages.

Result

The jury awarded $3,503,030 in compensatory damages on Feb. 13, 2024, and $4 million in punitive damages on Feb. 15, 2024. The court dismissed the cross-complaint on a directed verdict.

Other Information

A motion for an award of attorney's fees and interest is pending.

Deliberation

Five hours on compensatory damages. Two hours on punitive damages.

Poll

unanimous

Length

11 days