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Serafini v. Mariani

March 31, 2010

MICHAEL SERAFINI, LEO DEL SERRA, VINCENT BURNEY PLAINTIFFS
v.
RENATO MARIANI DEFENDANT



The opinion of the court was delivered by: Thomas I. Vanaskie United States District Judge

(JUDGE VANASKIE)

MEMORANDUM

Plaintiffs Michael Serafini, Leo Del Serra, and Vincent Burney bring this action against their former business associate, Defendant Renato Mariani, asserting various claims arising from the surrender of Plaintiffs' shares of Eagle National, Inc. ("Eagle") stock. All parties to this action formed Eagle in the late 1990's with the intention of starting a new business venture. Eventually, Eagle went into business with Mr. William Gilchrist, operating a truck stop. For reasons that are disputed, Plaintiffs effected a transfer of their Eagle shares to Mr. Mariani in 2001. Seven years later, Plaintiffs filed this suit seeking the return of their Eagle stock from Mr. Mariani, who denies having any obligation to return the stock in question. Mr. Mariani has moved for summary judgment, arguing that Plaintiffs' claims are both untimely and unsubstantiated. For the reasons that follow, Defendant's motion for summary judgment will be granted.

I. BACKGROUND

The facts are largely undisputed.*fn1 Prior to January, 1996, Plaintiffs worked at Empire Sanitary Landfill ("Empire"), located in Lackawanna County, Pennsylvania, in various positions. (Dkt. Entry 26, Defendant's Amended Statement of Material Facts ("DSMF") ¶ 2.)*fn2 Mariani was the President and a shareholder of Empire. (Id. at ¶ 1.)*fn3 Around the Fall of 1996, as Empire was being sold to another waste management company, Plaintiffs and Defendant formed Eagle, a subchapter "S" corporation. (Id. at ¶¶ 3-4.) On or about January 2, 1997, Eagle issued stock to Plaintiffs and Defendants. (Id. at ¶ 6.) Mr. Serafini, Mr. Burney, and Mr. Del Serra each received 100 shares of non-voting stock, while Mr. Mariani received 50 shares of voting stock and 50 shares of non-voting stock. (Id.) Mariani was awarded voting stock because he provided nearly all the funding for Eagle. (Id. at ¶ 8.) The parties agree that each person owned 25% of the corporation, but Plaintiffs dispute Defendant's assertion that he maintained sole control over Eagle because he was the only person with voting stock. (DSMF ¶ 8; PSMF ¶ 6.) Eagle's Board of Directors consisted of Plaintiffs and Defendant. (DSM ¶ 7.) The Board of Directors elected Serafini President and Del Serra Secretary and Treasurer. (Id. at ¶ 10.)

Mr. Mariani entered into a business arrangement with Mr. William Gilchrist, Jr., to own and operate a truck stop. (Id. at ¶ 15.) On January 31, 1997, Eagle entered into a partnership agreement with BWJCJ, Inc., a Pennsylvania corporation. Mr. Gilchrist was President of BWJCJ. The partnership was known as Big Blue Partnership ("Big Blue"). (Id. at ¶ 16.) Big Blue owned the land on which the truck stop was located.*fn4 (Id. at ¶ 18.) Mr. Mariani contributed the funds required for Eagle's participation in the partnership. (Id. at ¶ 19.) By the end of 1999, Mr. Mariani had advanced nearly $1,300,000 to Eagle.

The truck stop was managed by a separate entity, Big Ten Truck Stop, Inc. ("Big Ten"). Big Ten commenced operation of a Petro franchise truck stop on the land owned by Big Blue during 1997. (Id. at ¶ 28.) Although at one time Plaintiffs and Defendant had an ownership interest in Big Ten, in 1998, Plaintiffs transferred their shares in Big Ten to Mr. Mariani.*fn5 (PSMF ¶ 25.) As a result of the transfer of Plaintiffs' Big Ten shares, Mr. Mariani owned 50% of Big Ten. Mr. Gilchrist, through BWJCJ, owned the remaining 50% of Big Ten, and he retained final decision making authority over Big Ten's operations. (Id. at ¶ 29; PSMF ¶ 29.)

Plaintiffs assert, and Defendant denies, that in 2001 a dispute between Gilchrist and Defendant arose concerning how the truck stop was being managed because the truck stop was not profitable. (Id. at 30 n.10; PSMF ¶ 31.) Plaintiffs maintain that, in order to facilitate Mr. Mariani's resolution of the dispute with Gilchrist, Mariani requested that the Plaintiffs surrender their stock in Eagle. (DSMF ¶ 32.) According to Plaintiffs, transfer of their stock would allow Mariani to deal exclusively with Gilchrist. (Compl. ¶¶ 7-9.)

On or about June 21, 2001, Plaintiffs went to the office of Attorney Albert Weinschenk, who was counsel for Eagle as well as Mariani's personal lawyer, and effected the stock transfer. (DSMF ¶ 33.) Specifically, by letter dated January 2, 2001, but executed on or about June 21, 2001 in Mr. Weinschenk's office, Serafini resigned as Eagle's President and Director, Del Serra resigned as Eagle's Secretary and Director, and Burney resigned as Director. (DSMF ¶ 33-4; Dkt. Entry 26, Attach. "16".) That same day, each Plaintiff signed an affidavit of lost stock certificate for 100 non-voting shares of Eagle, and counter-signed separate letters from Mariani to each Plaintiff "confirm[ing] that there are no outstanding obligations due me from you with respect to Eagle and no outstanding obligations are due you from Eagle."*fn6 (Dkt. Entry 26, Attach. "18".) Additionally, the surrendered shares were re-issued to Defendant. (DSMF ¶ 37; Dkt. Entry 26, Attach. "23", Weinschenk Dep. 30:7-32:22.) It is undisputed that at the time of the stock transfer there was no written commitment for the return of the stock by Mariani at some future date. (DSMF ¶ 36.)

By the time of the alleged dispute between Mariani and Gilchrist, Plaintiffs were no longer involved in the daily operations of the truck stop. (Id. at ¶ 39.) On February 14, 2002, Big Ten and Big Blue, jointly referred to as landlord, leased the truck stop to Scranton Petro. (Id. at ¶ 40.) According to Mariani, the lease to Scranton Petro marked the end of any alleged disagreement with Gilchrist. (Id.) Plaintiffs, however, deny knowing that the dispute had been resolved. (PSMF ¶ 60.) In any event, Mariani moved on to become a wholesaler of candy and tobacco products, and Plaintiffs remained employees in these ventures, but without any ownership interest.*fn7 (DSMF ¶ 42-3.)

Mariani, Serafini and Del Serra had also been linked as conspirators in a criminal prosecution that culminated with each pleading guilty.*fn8 Each was sentenced to prison in 2002.

Before Serafini and Mariani surrendered to commence service of their prison terms, Serafini approached Mariani and asked him to sign a handwritten document prepared by Serafini. (Mariani Dep. 91:15-23, Ex. "1".) In the document dated July 2, 2002, Mariani promises to keep Serafini's wife and son on "Eagles [sic] & Midvalleys [sic] Health Insurance while we are away[.]" (Id. at Ex. "1".) The note also states that Mariani would pay Serafini's legal fees, fines and restitution, continue to pay on a note issued to Mariani from Serafini, and "[a]fter settleing [sic] with Billy Gilchrist to give back to you your 12.5% stock in the truck stop after all of us are finished."*fn9 (Id.) On or about July 6, 2002, Mariani and Serafini surrendered to authorities, (DSMF ¶ 48), and began serving their sentences at the same location, Lewisburg. (Id. at 49; PSMF ¶ 49.)

Shortly after Mariani and Serafini began serving their sentence,*fn10 Mrs. Serafini's and her son's health insurance coverage was terminated, resulting in a deterioration in the relationship between Mr. Mariani and Mr. Serafini. (DSMF ¶¶ 52-3.) While Mariani and Serafini were serving their sentence, the two never discussed Mariani's alleged promise to transfer back to Serafini his interest in the truck stop. (Id. at ¶ 54.)

Del Serra testified that after Serafini began his prison term (July 8, 2002), but before he began his own prison sentence (October, 2003),*fn11 Del Serra, Burney, and Serafini's mother, as a representative for the incarcerated Serafini, met with an area lawyer concerning the Eagle stock." (Del Serra Dep. 104:10-24.) Because the Plaintiffs lacked funds, they did not pursue any course of action against Mariani with respect to the return of their Eagle stock. (DSMF ¶ 56.)

Serafini acknowledges that he had heard rumors that Mariani and Gilchrist had resolved their differences "and they were leasing the truck stop." (Dkt. Entry 26-6, Serafini Dep. 89:14-17.) In the Spring of 2007, approximately three years after Serafini was released from prison, Plaintiffs sent certified letters to Mariani, demanding return of their stock. (Id. at 90:11-91:10.) It is undisputed that the letters were returned to Plaintiffs unopened. (PSMF ¶ 67.) It is also undisputed that the letters sent in April of 2007 were the first attempt by Plaintiffs to secure a return of their Eagle stock. (Dkt. Entry 26-6, Serafini Dep. 91:23-92:1.) Finally, Plaintiffs acknowledge that it was not until Mariani was served with the complaint in 2008 that he learned that Plaintiffs sought the return of their Eagle stock. (DSMF ¶ 70.)

Plaintiffs brought this action on March 12, 2008. Plaintiffs assert claims of conversion (Count I), replevin (Count II), unjust enrichment (Count III), and constructive trust (Count IV).*fn12 (Dkt. Entry 1.) Defendant filed an answer with affirmative defenses on May 27, 2008. (Dkt. Entry 8.) On January 9, 2009, ...


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