Rozenwald testified with respect to this meeting and his version of the facts is similar to
Shuchat’s, he never denied that he indicated to Shuchat that she could augment her income by
taking on independent projects.
35] Second, Shuchat argues that in her meeting of January 2015 when Rozenwald
instructed that DES was to have no involvement in the CRC, she would have made it clear that
she would continue the project independently.
36] Shuchat’s own evidence, however, does not support her position. Both during her pre-
trial examination and at trial, she testified that she protested when Rozenwald indicated
that DES was to have no involvement with the CRC because she believed in its potential. When
she told Rozenwald that there was work done by her team, he instructed her to leave the
material on the company server. At no time did she advise Rozenwald that she would
independently pursue her collaboration with the CRC.
37] Her argument is also inconsistent with other facts in evidence. For example, in
November 2015, she emailed Rozenwald using her Paragon email account and immediately
thereafter indicated to him that, by error, she had used the account of her husband’s
38] In fact, Paragon was incorporated in the State of California by Shuchat in January
015. In addition to herself, the shares were held by designer Paula Bradley, with whom
Shuchat had worked on the “L.A.M.B.” collection and who had agreed to cooperate on the
CRC, and by Bruce Kirkland who was a music industry consultant, both of whom are based
in Los Angeles.
39] Both Shuchat and Bradley confirmed that Paragon was established specifically to
partner in the joint venture with Rocha to develop the CRC.
40] Although Shuchat testified that her husband was involved in Paragon, her testimony in
that respect is not credible. Not only was she vague in this regard but the incorporation
documents do not refer to him and no evidence supports him having any contribution in the
project. Moreover, during her examination for discovery, Shuchat stated that her husband had
no involvement in Paragon.
41] The Court further notes that by 2014, Shuchat was unhappy with her working
conditions and her increasingly difficult relationship with Rozenwald. She admits that by this
time she was considering relocating to Los Angeles. Bradley testified that she was aware of
Shuchat’s plan and had looked at real estate opportunities with Shuchat in planning the
latter’s move to Los Angeles.
42] Had Shuchat advised Rozenwald that she was actively working on the CRC, there
would have been no need for her to try to distance herself from Paragon.
43] Hence, although Rozenwald indicated that she augment her income by taking on
independent projects insofar they did not compete with company business, Shuchat never
advised him of her ongoing collaboration in designing the CRC. In fact, she made efforts to
keep her involvement from him.
44] Because Rozenwald did not authorize Shuchat to develop the CRC while she worked for
DES, the Court must determine whether independently working on the CRC competed with
the interests of the Manhattan Group.
45] Shuchat admits that she pursued the CRC for her own benefit and that of Paragon
following her meeting with Rozenwald in January 2015. She produced two collections, one in
the spring of 2016 and one in spring 2017.
46] Although Shuchat attempted to minimize her involvement, the evidence demonstrates
that she played a pivotal role. She admitted that in addition to the funding provided by
Kirkland, she raised financing through Chinese suppliers. In addition, the emails exchanged
with various persons including Rocha, her husband James Conran, her licensing agent Shelly
Marchetti and Bradley illustrate her involvement in every aspect of the design of the
collection, choice of materials, quality control of the samples, meetings with Rocha and her