Insurance broker to request attorney fees, punitive damages in joint venture dispute

By Heather Isringhausen Gvillo | Jan 29, 2019

Two insurance professionals have come to an agreement with regards to the plaintiff’s request for attorney’s fees in a suit involving a joint venture to provide insurance brokerage services to Bethalto Community Unit School District #8.

Madison County Circuit Judge Dennis Ruth filed an agreed order on Jan. 7, stating plaintiff David Wiegand has no objection to defendant Kerry Baugher’s motion to strike his prayer for attorney fees with respect to the breach of contract and unjust enrichment allegations.

However, Baugher agrees that Wiegand is able to seek an award for attorney’s fees as a component of a possible punitive damages award under the breach of fiduciary duty allegation in the complaint.

Baugher filed a motion to strike the plaintiff’s prayer for attorney fees on Nov. 21 through attorney Richard Gibson of Wood River.

The defendant argued there is no writing or prior agreement between the parties entitling any party to recover attorney fees for the counts alleging breach of contract, breach of fiduciary duty and unjust enrichment.

Wiegand filed a response in opposition to the defendant’s motion to strike on Dec. 12 through attorney Thomas Horscroft of Goldenberg Heller & Antognoli PC in Edwardsville.

The plaintiff objected to the defendant’s motion to strike his request for attorney’s fees for breach of fiduciary duty as a component of an award of punitive damages.

Wiegand alleged the complaint “sets forth ample allegations that defendants’ breaches of their fiduciary duties were willful.”

Wiegand filed the complaint on Oct. 18 against Baugher and Baugher Financial & Associates, alleging he has engaged in a joint venture with the defendants to provide insurance brokerage services to Bethalto Community Unit School District #8.

The plaintiff claims he began working with Don Clark in 1999 as insurance agents for Bethalto. Shortly after, Clark, Wiegand and Baugher allegedly agreed to run cases through Baugher Financial in order to qualify for production bonuses. At the time, Clark and Wiegand received 100 percent of the commissions and 50 percent of the bonuses from the accounts.

Beginning in 2013, Baugher became involved in the provision of insurance brokerage services to Bethalto and he began to share commissions equally with Wiegand and Clark, each receiving one-third of the commissions.

Clark retired in 2013. Wiegand and Baugher each purchased one-sixth of Clark’s share of the Bethalto account, leaving them each with half of the commissions and bonuses from the Bethalto account.

However, in 2014, Wiegand claims Baugher initiated efforts to exclude him from participating in the Bethalto account.

“For instance, Baugher scheduled meetings with key personnel at Bethalto for particular times, but would begin closed-door meetings with these individuals prior to the scheduled start times in order to prevent plaintiff from participating.”

Despite Baugher’s alleged efforts to exclude the plaintiff, Wiegand claims he and his staff continued to attend meetings.

Then in 2015, Baugher merged Baugher Financial with Cornerstone Insurance Group. During a meeting with Wiegand, Baugher allegedly represented that he was retaining ownership of all of his client accounts, but Cornerstone would be receiving 35 percent of Baugher’s commissions. Baugher allegedly informed Wiegand that he was not going to continue to pay the plaintiff his full share of the Bethalto commissions and bonuses.

Wiegand alleges Baugher threatened that if he did not accept the reduction, then Baugher would seek to prevent the plaintiff from any further involvement in the Bethalto account.

During a May 25, 2018 meeting with Baugher, Wiegand learned that Assured Partners, a national insurance brokerage based in Florida, had acquired Cornerstone.

Wiegand alleges Baugher attempted to discourage Bethalto from continuing to work with the plaintiff.

The defendants answered the complaint on Nov. 21, denying liability.

“Though defendant continues to deny he owes anything to plaintiff under any theory of recovery, should plaintiff be awarded any damages, those damages should be offset by one-half of any bonuses received by plaintiff not received by defendants, Kerry Baugher or Baugher Financial for the years 2014 through the present,” the affirmative defense states.

Madison County Circuit Court case number 18-L-1401

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Goldenberg, Heller, and Antognoli Law Off. Of Richard W. Gibson Madison County Circuit Court

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