complaint

B 1 99— Summons mithout notice, Supreme Court.

_____________

persona) or substituted service. 12 pt. type, 4-94© 1993 BkimbefgE/celsior. Inc.. Publisher. NYC 1c013

www.blumberg.com

$Suprrmi (Inurt iii flTr fafr uf ‘ifti ‘urk(Liunt Of NEW YORK

.

CATHERINE SHANLEY and WENDY BUCKLEY,

against

LOUISE BLOUIN MEDIA, INC.,LOUISE BLOUIN and BEN HARTLEY,

Plaintiff(s)

Defendant(s)

Index No.Date purchased

Plaintiff(s) designate()New York

County as the place of trial.

The basis of the venue isdefendants’ principal

place of business

$ummnuz

Plaintiff(s) reside(s) at

County of

To the above named Defendant(s)

mt trr 1preh31 ummutwb to answer the complaint in this action and to serve a copy of

your answer, or, if the complaint is not served with this summons, to serve a notice of appearance, on the Plaintiff’s

Attorney(s) within 20 days after the service of this summons, exclusive of the day of service (or within 30

days after the service is complete if this summons is not personally delivered to you within the State of New

York); and in case of your failure to appear or answer, judgment will be taken against you by default for the relief

demanded in the complaint.

FRANKFURT KURNIT KLEIN & SELZ, P.C.Attorney(s) for Plaintiff

Office id Post Office Add 55

QkL-.Wendy Stykr L,

488 Madison Av’j, 1i Fl.New York, NY 10022(212) 980—0120

Dated, New York, New YorkFebruary 10, 2014

Defendant’s address:

601 West 26th StreetSuite 410New York, NY 10011

By:

FILED: NEW YORK COUNTY CLERK 02/11/2014 INDEX NO. 151232/2014

NYSCEF DOC. NO. 1 RECEIVED NYSCEF: 02/11/2014

SUPREME COURT OF THE STATE OF NEW YORKCOUNTY OF NEW YORK

xCATHERINE SHANLEY and WENDYBUCKLEY,

Index No.Plaintiffs,

COMPLAINT-against-

LOUISE BLOUIN MEDIA, INC., LOUISEBLOUIN and BEN HARTLEY,

Defendants.x

Plaintiffs Catherine Shanley (“Shanley”) and Wendy Buckley (“Buckley”) (each a

“Plaintiff” and together, “Plaintiffs”), by their attorneys Frankfurt Kurnit Klein & Selz, P.C.,

complaining of the defendants Louise Blouin Media, Inc. (“LBM”), Louise Blouin (“Blouin”)

and Ben Hartley (“Hartley”) (each a “Defendant” and together, “Defendants”), allege as follows:

INTRODUCTION

1. This is an action for monetary damages arising out of Defendants’ breach of

contract and violations of the New York State Labor Law § 190 et seq., as well as retaliation for

firing Plaintiffs when they complained of Defendants’ failure to pay salary and commissions.

JURISDICTION AND VENUE

2. This Court has personal jurisdiction over Defendants pursuant to New York Civil

Practice Law and Rules (“CPLR”) § 301 and 302(a).

3. Venue in this Court is proper pursuant to CPLR § 503(a) and (c), as LBM has its

place of business in New York County,. and the acts complained of took place in New York.

PARTIES

4. Plaintiff Catherine Shanley, an individual, resides in Queens County, New York,

and was employed by LBM as the Director of Sales commencing on or about June 2003 and as

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Publisher, Art + Auction from on or about November 2009. She received notice of termination

of her services effective March 31, 2014.

5. Plaintiff Wendy Buckley, an individual, resides in New York County, New York,

and was employed by LBM as a Sales Consultant commencing May 2006 and then Associate

Publisher, Art + Auction and Publisher, BLOUINARTINFO (Asian edition) and

BLOUINLfesiyle. She also started up a new daily print publication, BLOUINARTINFO. corn

(Daily edition). She received notice of termination of her services effective January 31, 2014.

6. Defendant LBM was and still is a corporation organized under and by virtue of

the laws of the State of Delaware, with its principal place of business at 601 West 26th Street,

Suite 410, New York, New York 10011.

7. Defendant Louise Blouin is the owner and Chief Executive Officer of LBM and

upon information and belief resides at 165 Charles Street, PH, New York, New York, 10014.

During all relevant times, Blouin was responsible for major personnel decisions at LBM

including but not limited to the setting and payment/approval of payment of compensation.

Plaintiffs worked under her direction.

8. Defendant Ben Hartley is the President of LBM and upon information and belief,

resides at 100 Nevins Street, Brooklyn, New York 11217. At all relevant times, Hartley was

responsible for major personnel decisions including but not limited to the payment of

compensation and was responsible for day-to-day operations of LBM.

FACTUAL BACKGROUND

Shanley Background

9. On or about June 2003, Shanley commenced working at LBM pursuant to a series

of written agreements. In April 2009, Shanley and LBM entered into an agreement pursuant to

which Shanley was to be responsible for advertising sales services for a number of publications

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including A rt+A uction, Modern Painters, Gallery Guide and www.artinfo.com in the assigned

regions of New York, the Southeast and “other designated regions with advertising prospects to

be determined by the Company.” A copy of the April 2009 agreement (the “Shanley

Agreement”) is attached as Exhibit A.

The Terms of the Shanley Agreement

10. Under the Agreement, Shanley was to report to David Gursky (“Gursky”), the

Vice President/Group Publisher of LBM.

11. With respect to compensation, she was to receive a draw of $4,000 per month

against a 15% commission on all net collected display advertising sales for Art+ Auction and

20% for Modern Painters, Gallery Guide and www.artinfo.com.

12. The Shanley Agreement also contained the following specifications;

(a) Commissions are “earned when payment is received and after the

advertising has run” (Schedule A, p. 4);

(b) Payments will be made by the 5th of the second month after the

commissions are earned (Id.); and

(c) Commissions are not “earned” if Shanley was not “working for the

company at the time the invoice is paid” (Id.); and

(d) Shanley was an “independent contractor.”

13. Shanley was at all times subject to the supervision, direction and control of LBM

and reported to the President and CEO.

14. She worked exclusively for LBM, attended weekly, mandatory sales meetings,

provided regular weekly reporting and worked full-time from the LBM offices.

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15. At all relevant times, Shanley had an assigned desk and company email address

and phone equipment. Shanley was listed in the LBM office directory and on its floor plan and

had LBM business cards.

16. Upon information and belief, during this period of time, LBM had other workers

in its Sales department who performed the same or similar services but who were paid as

employees receiving a salary and/or benefits.

Buckley Background

17. On or about May 2006, Buckley commenced working at LBM to provide

advertising sales services for Gallery Guide. She worked under a series of contracts and proved

to be so successful at her job that in or about January 2009, she was hired pursuant to a written

agreement attached as Exhibit B (individually, the “Buckley Agreement” and with the Shanley

Agreement, the “Agreements”).

18. Pursuant to the Buckley Agreement, she was to provide advertising sales services

with respect to Art+Auction. In addition, she provided sales services for publications including

but not limited to Modern Painters and artinfo.com.

The Terms of the Buckley Agreement

19. Under the Buckley Agreement, Buckley was to receive a draw of $5,000 per

month against commissions of 15% on all net collected display advertising sales for Art+

Auction.

20. The Buckley Agreement also contained the following specifications;

(a) Commissions were “earned when payment is received and after

advertising has run” (Schedule A, p. 4);

(b) Payments will be made by “on the payroll of the month after the

commissions are earned” (Id.); and

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(c) Buckley was an “independent contractor.”

21. Buckley was at all times subject to the supervision, direction and control of LBM

and in particular reported to the President and CEO.

22. She worked exclusively for LBM, attended weekly, mandatory sales meetings,

provided regular weekly reporting and worked full-time from the LBM offices.

23. At all relevant times, Buckley had an assigned desk and company email address

and phone equipment. Buckley was listed in the LBM office directory and on its floor plan and

had LBM business cards.

24. Upon information and belief, during this period of time, LBM had other workers

in its Sales department who performed the same or similar services but were paid as employees

receiving a salary and/or benefits.

Reporting of Ad Sales and Commissions

25. Both Buckley and Shanley proved exceptionally successful at selling advertising

space on behalf of LBM publications. Buckley and Shanley together were responsible at all

relevant times for bringing in at least half of LBM’s overall revenue.

26. From the commencement of their engagement at LBM through their receipt of

notice of termination, they also prepared and circulated regular weekly reports documenting their

sales, including but not limited to the name of the advertiser, the sale amount, and the rate that

the advertiser was given. These reports were regularly circulated to Blouin, LBM President

Hartley, the LBM President of Global Sales, and other LBM financial reporting personnel.

27. LBM, for its part, provided both Buckley and Shanley with monthly reports of

earned commissions (the “Commission Reports”). Each Commission Report listed the client, a

description of the advertisement that had been sold, the amount paid and the date on which it had

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been paid, and the applicable commission rate, along with a total of all commissions due to be

paid.

Shanley and Buckley’s Job Responsibilities are Changed

28. In or about November 2009, Gursky left the Company.

29. Blouin instructed Gursky, who had been a salaried employee, to work with

Shanley and Buckley to divide up his Publisher responsibilities so that Plaintiffs could take over,

respectively, as Publisher and Associate Publisher ofArt+Auction.

30. Shanley and Buckley took on significant new duties as Publisher and Associate

Publisher.

31. As Publisher, Shanley was responsible for managing all sales including but not

limited to hiring, training and managing the worldwide sales staff. She was required to work

with and coordinate the New York-based editorial, production and finance departments to plan

issues, lay out ad space, and help with debt collection. She developed and reviewed media kits,

reviewed and approved sales expenses, and handled customer relations problems and solutions.

She was responsible for the coordination of all fairs, including booths, sponsorships, and

magazines.

32. As Associate Publisher, Buckley worked alongside Shanley to perform most if not

all of these responsibilities.

33. In order to provide these services, Plaintiffs worked full-time and exclusively for

LBM and were subject to the supervision, direction and control of Hartley and Blouin.

34. As noted in a memo prepared by Gursky upon his departure, Shanley and Buckley

were required, as Publisher and Associate Publisher to “work with all parts of the company,

wherever assistance is needed.”

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35. As Publisher and Associate Publisher, Shanley and Buckley were provided with

new LBM branded business cards that identified them as the “Publisher” and “Associate

Publisher”. Their new titles were contained in their company email signature blocks and on the

Art+A uction masthead.

36. In return for these increased Publisher responsibilities, in January 2012 LBM and

Shanley agreed to a new compensation pian (the “Shanley 2012 Plan”, attached as Exhibit C).

37. Pursuant to the Shanley 2012 Plan, Defendants agreed to pay Shanley an annual

“consultancy fee” of $25,000, which from January 2012 through June 2013 was paid on a

monthly basis in the amount of $2084.

38. Shanley also agreed to a reduced commission plan of 15% for “all net collected

listing and display adverting sales in [her] assigned publication. . . . “.

39. The Shanley 2012 Plan provided for the payment of commissions “on the 2’

payroll of the month after the commissins are earned.”

40. Buckley was not offered any additional compensation for her Associate Publisher

responsibilities but continued to receive commissions pursuant to the Buckley Agreement.

41. Defendants, however, continued to assign Plaintiffs new and additional work.

42. In or about November 2012, Blouin assigned Buckley the responsibility of

starting up a new print publication, BLOUINARTINFO (Asian edition) to be distributed six times

per year.

43. In or about January 2013, Blouin also assigned Buckley the work of starting a

daily edition newspaper.

44. Thus, in or about January 1, 2013, Buckley and LBM entered into an addendum

to the Buckley Agreement by which Buckley would “act as the Publisher of BlouinArtlnfo.com

Asia magazine and perform services customary of a publisher (“Publisher Services”).” In

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exchange, Buckley was to be paid “a fee of $1,000 per month for the Publisher Services”

(“Buckley Addendum”, attached as Exhibit D).

45. The Publisher Services continued to involve significant amounts of Buckley’s

time, particularly in or about June 2013 when Blouin abruptly instructed Buckley to completely

remake BLOUINARTINFO (Asia edition) from an art publication into a lifestyle publication with

a different name, BLOUINLfestyle.

46. At all relevant times when they were performing Publisher and Associate

Publisher services, Plaintiffs remained subject to the supervision, direction and control of LBM,

Blouin and Hartley.

47. Upon information and belief, Shanley and Buckley were the only members of

LBM management who were not paid as employees and provided with benefits.

Blouin Initiates Conversations about Changing Plaintiffs’ Compensation

48. In or about mid-2013, upon information and belief, Blouin became unhappy with

the amount of money that Shanley and Buckley were earning in commissions.

49. At or about this time, Defendants stopped paying Shanley her monthly

consultancy fee and began delaying the payment of commissions to both Plaintiffs.

50. Blouin also began conversations with both Buckley and Shanley about entering

into a new working arrangement that would involve increased work responsibilities and

decreased compensation.

51. During these conversations and in conversations with others, Blouin expressed

irritation about the Plaintiff’s current compensation arrangement.

52. Blouin began to impose obstacles on Plaintiffs to prevent them from achieving

their sales goals and earning commissions and complained that Plaintiffs “make too much

money.”

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Defendants Cease Paying Buckley and Shanley

53. At or about November 2013, Defendants also ceased paying Buckley and Shanley

commissions that were due and owing despite the fact that Commission Reports had been

provided.

54. Although Plaintiffs made numerous complaints and requests for compensation,

such complaints were routinely ignored.

55. Blouin also threatened Plaintiffs’ continued employment if they did not stop

demanding their past due compensation.

56. Then in early December 2013, Blouin circulated drafts of proposed modifications

to Plaintiffs’ agreements that included, inter alia, modifications to Plaintiffs’ compensation

structure (the “Draft Agreements”).

57. During the month of December, as the parties negotiated the terms of the Draft

Agreements, Plaintiffs continued to demand their past due compensation.

58. On or about December 23, 2013, the Plaintiffs participated in a meeting by

telephone with Blouin and her chief of staff Michael-John Pierce. In particular, the parties

discussed that Shanley would continue as Publisher of Art+Auction for an annual salary plus

certain reduced commissions, and that Buëkley would continue as Publisher of BLOUINLfestyle

for a salary and certain reduced commissions.

59. On or about December 23, 2013, Shanley received her revised Draft Agreement.

It did not include a provision for payment of past due compensation.

60. Buckley understood that her revised Draft Agreement would be provided shortly.

61. The same day, Plaintiffs complained to Blouin and Hartley that the Draft

Agreement provided to Shanley did not guarantee payment of past due compensation and

demanded a written guarantee.

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Blouin and Hartley Retaliate Against Plaintiffs

62. One week later, Plaintiffs walked into the office and were handed written notices

of termination.

63. Buckley was given a written notice of termination effective January 31, 2014.

64. Shanley was given a notice of termination effective March 31, 2013.

65. Both notices of termination were signed by Hartley.

66. Despite the dates on the notices, on or about January 4, 2014, Hartley told both

Plaintiffs to “finish up any LBM business by January 6” and had Plaintiffs’ LBM email accounts

shut down,

67. Plaintiffs were specifically advised that “[Blouin] doesn’t want you working on

any more business.”

68. Blouin, and Hartley working on her behalf and on behalf of LBM, thus terminated

Plaintiffs’ employment in response to and in retaliation for their having asserted their wage

claims.

69. Despite due demand, Defendants have failed to pay Plaintiffs any further

compensation or commissions due.

70. Defendants have failed to pay Plaintiffs earned commissions as follows:

Shanley Buckley

September Commissions $20,282.61 $1 1,724.80(due November 15, 2013)

October Commissions $25,755.00 $17,297.50(due December 15, 2013)

November Commissions $22,579.11 $10,825.30(due January 15, 2014)

December Commissions $19,340.35 $14,819.00(due February 15, 2014)

TOTAL $87,957.07 $54,666.60

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71. Plaintiffs are also owed and will be owed additional amounts for commissions

earned in subsequent months in an amount to be determined.

72. Inter alia, Shanley is entitled to receive payment for all commissions “earned”

through March 31, 2014, and Buckley is entitled to receive payment for commissions based on

all net sales achieved by her through January 31, 2014, regardless of the date on which the

commissions become “earned” under her Agreement.

73. Because the majority of the advertising was sold on a prepaid basis, and

advertising “runEs]” as per the terms of the Agreements at the end of the prior month, Shanley is

entitled to commissions through at least the April issue of her publications.

74. Defendants have further failed to pay Shanley other due and owing compensation

including but not limited to her monthly “Consultancy Fee” for July 2013 through March 2014.

75. Subject to an accounting, Plaintiffs estimate that they are thus also owed or will

be owed at least the following amounts:

Shanley Buckley

Balance of UBS Conference $2,400.00Prepaid

January Commissions $8,171.85 $2,336.25

February Commissions $11,352.15 $6,324.75

March Commissions $6,874.35 $7,273.80

April Commissions $4,320.00 $7,290.00

Other 2014 Commissions $9,734.25

“Consultancy Fee” $18,756.00

TOTAL $49,474.35 $35,359.05

76. As shown in paragraphs 70 and 75 above, upon information and belief and subject

to an accounting, the total due to Plaintiff Shanley is $137,431.32 and to Plaintiff Buckley is

$90,025.65.

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77. Defendants continued to engage in retaliatory acts against Plaintiffs subsequent to

December 30, 2013.

78. Upon information and belief, Blouin has falsely stated to LBM staff on multiple

occasions that Plaintiffs are “greedy,” “evil” and that Plaintiffs “stole” money and clients as well

as commissions due to others.FIRST CAUSE OF ACTION

(Violation of New York State Labor Law)(Against LBM, Blouin And Hartley)

79. Plaintiffs repeat and reallege each and every allegation contained in Paragraphs 1

through 78 of this Complaint as if fully set forth herein.

80. At all relevant times, Plaintiffs were misclassified as independent contractors and

were in fact employees of LBM under the New York Labor Law.

8 1. At all relevant times, Blouin and Hartley acted as employers under the New York

Labor Law with respect to the termination of Plaintiffs’ employment and refusal to pay

compensation that is due.

82. Defendant’s failure to pay Plaintiffs their contractually-promised wages and

commissions as set forth above constitute a violation of the New York State Labor Law, § § 190

et seq., including but not limited to § 193.

83. Defendants’ withholding of wages and commissions was willful, having been

done knowingly, deliberately and voluntarily in disregard of their obligations.

84. By the acts and practices described above, Defendants are liable to Plaintiffs for

their unpaid wages and commissions, as well as statutory liquidated damages of 100% of wages

and commissions owed, costs and attorneys’ fees.

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SECOND CAUSE OF ACTION(Retaliation)

(Against LBM, Blouin and Hartley)



86. At all relevant times, Plaintiffs were misclassified as independent contractors and

were in fact employees of LBM under the New York Labor Law.

87. At all relevant times, Blouin and Hartley acted as officers and/or agents of LBM

with respect to the termination of Plaintiffs’ employment and refusal to pay compensation that is

due.

88. Defendants retaliated against Plaintiffs by terminating their employment due to

Plaintiffs’ complaints about not being paid past-due wages and commissions.

89. Defendants further retaliated against Plaintiffs by refusing to let them perform

sales services and shutting them out frori the LBM offices and email despite the fact that the

Plaintiffs’ written notices of termination stated that they did not take effect until January 31,

2014 and March 31, 2014.

90. Blouin further retaliated against Plaintiffs by engaging in post-termination actions

as set forth above that may cause Plaintiffs to experience significant reputational harm and/or

negatively affect their ability to procure future employment or business opportunities.

91. Defendants’ actions as set forth above constitute a violation of the New York

State Labor Law, §2 15.

92. By the acts and practices described above, Defendants are liable to Plaintiffs for

their unpaid wages and commissions, as well as damages, costs and attorneys’ fees.

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THIRD CAUSE OF ACTION(Breach of Contract)



94. The Agreements are contracts between Plaintiffs and LBM, pursuant to which

LBM assumed a number of obligations to Plaintiffs.

95. Plaintiffs have fully performed their obligations under the Agreements.

96. LBM wrongfully breached the Agreement by imposing arbitrary obstacles to

prevent Plaintiffs from achieving sales, and failing to compensate Plaintiffs according to the

terms of the Agreements.

97. The foregoing acts on the part of LBM constitute material breaches of the

Agreement. Plaintiffs have been damaged by LBM’s breach in an amount to be determined at

trial, but no less than the amount of Plaintiffs’ unpaid salary and commissions.

FOURTH CAUSE OF ACTION(Unjust Enrichment)



99. Plaintiffs, in reasonable reliance on LBM’s promises and representations,

performed valuable services for LBM from July 2013 through December 2013, which LBM

accepted and from which it profited and will continue to profit.

100. Despite due demand, LBM has failed or refused to pay all compensation due to

Plaintiffs for said services, thereby unjustly enriching itself to Plaintiffs’ detriment, and causing

Plaintiffs to suffer damages in an amount to be determined at hearing, plus interest.

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FIFTH CAUSE OF ACTION(Quantum Meruit)

101. Plaintiffs repeat and reallege each and every allegation contained in Paragraphs I


102. As described above, Plaintiffs provided Publisher services to Defendant for over

four years. Plaintiffs also provided valuable sales services. For 2013 alone, Shanley has been

responsible for at least $1.7 million in overall sales and Buckley for at least $1.2 million in

overall sales.

103. Defendant accepted Plaintiffs’ services with the knowledge that they would have

to compensate them for such services and also in accordance with the Agreements.

104. Defendant has failed to pay Plaintiffs the outstanding amounts due despite due

demand therefore.

105. By reason of the foregoing, Plaintiffs have been damaged and are entitled to

compensation for the reasonable value of their services in an amount to be determined at hearing,

plus interest and costs.

WHEREFORE, Plaintiffs demand judgment in their favor as follows:

(a) On all Causes of Action, that this Court direct LBM to account for and pay to

Plaintiffs their unpaid wages and commissions in an amount to be determined at

trial but not less than the amounts set forth in ¶J 70-76; and

(b) On the First Cause of Action, that this Court direct LBM, Blouin and Hartley to

pay to Plaintiffs liquidated damages of 100% of wages and commissions owed as

well as Plaintiffs’ attorneys’ fees and costs reasonably incurred in this action

pursuant to New York Labor Law § 198(1-a); and

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(c) On the Second Cause of Action, that this Court direct LBM, Blouin and Hartley to

provide Plaintiffs with all appropriate relief available under New York Labor Law

§ 215 including reinstatement, payment of all wages and commissions due,

damages and reasonable attorneys’ fees; and

(d) Such other and further relief as this Court deems just and proper.

DEMAND FOR JURY TRIAL

Pursuant to CPLR § 4101, Plaintiffs demand a trial by jury.

Dated: New York, New YorkFebruary 11, 2014

FRANKFURT KURNIT KLEIN & & SELZ,:.

y9er

488 Madison Avenue, 10th FloorNew York, New York 10022(212) [email protected]

Attorneysfor PlainUffs Catherine Shanley andWendy Buckley

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complaint

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