KENNETH D. JENKINS
DAVID BAKST & another.
Heard: February 8, 2019.
at Law, Malpractice, Negligence. Evidence, Legal malpractice,
Professional standards. Negligence, Attorney at law, Standard
of care, Causation. Contract, Employment. Corporation,
Valuation of stock. Proximate Cause. Practice, Civil, Summary
action commenced in the Superior Court Department on February
24, 2015. The case was heard by Helene Kazanjian, J., on a
motion for summary judgment.
T. Guthrie for the plaintiff.
A. Curley, Jr. for the defendants.
Present: Hanlon, Kinder, & Englander, JJ.
an attorney malpractice action. The plaintiff, Kenneth D.
Jenkins, claims that his attorney was negligent in
negotiating the stock buy-back clause (clause or buy-back
clause) in Jenkins's employment agreement with his new
company, Apollo Security International, Inc.
(Apollo). Jenkins claims that the clause
contained in the employment agreement did not comport with
the instructions he gave to his attorney, and that as a
result he was damaged when, upon his termination from Apollo,
he received an inadequate payment from Apollo for his Apollo
stock. A Superior Court judge granted summary judgment for
the defendants, reasoning that Jenkins had failed to adduce
facts from which a fact finder could find either a breach of
the standard care, or causation. We affirm.
2003, Jenkins entered into negotiations with Apollo with a
view toward joining the company as its president and chief
operating officer. Apollo provided security services to
businesses. As of 2003 Jenkins was working as a regional
president for Pinkerton Security, and he had decades of
experience in the security business.
principal of Apollo was Dennis Crowley. Crowley and Jenkins
were friends, having worked together in the security industry
years earlier. Crowley and Jenkins worked out the basics of
Jenkins's compensation, which included a salary and a
percentage of Apollo's stock. Because Apollo was
privately owned, Jenkins and Crowley agreed that if Jenkins
were terminated, Apollo would buy back Jenkins's stock
retained David Bakst, of the law firm of Morrison Mahoney LLP
(Morrison), to represent him in the negotiation and drafting
of his employment agreement. The point of contention
in this case is the clause in the employment agreement that
defined how Jenkins's stock would be valued upon
buy-back; Jenkins's position is that he told Bakst he
wanted to receive fair market value for the stock, and that
Apollo's fair market value should be measured by a
percentage of Apollo's annual revenues -- "anywhere
from 25 to 35 percent or some numbers like that." The
buy-back clause in the employment agreement, however, did not
establish fair market value based on a percentage of annual
revenues. Rather, it provided for valuation by an entirely
different approach, an approach Bakst had suggested during
left Apollo ten years later, in 2013. When he left, Apollo
obtained appraisals under the employment agreement's
valuation method that valued Jenkins's stock at
approximately $200, 000. Jenkins, on the other hand, claimed
that he should have received at least $1.6 million for his
stock, and perhaps as much as $3.4 million. Notably,
Jenkins did not seek either to mediate or to arbitrate the
buy-back amount (arbitration was provided for in the
employment agreement). Apollo requested arbitration, but
before any hearing, Jenkins agreed to settle his claims with
Apollo for $1 million.
brought this suit against Bakst and Morrison in 2015. The
gist of his claim is that he told Bakst that the employment
agreement's fair market value formula should value Apollo
at between twenty-five and thirty-five percent of annual
revenues, and that Bakst failed to follow his instructions.
After discovery, the defendants moved for summary judgment,
which the motion judge granted in a thoughtful decision. She
ruled that on the undisputed material facts a fact finder