Schron v. Troutman Saunders LLP

In one agreement, Cammeby's Equity Holdings LLC (Cam Equity) received an option to acquire 99.99 percent of the ownership units of SVCare at the strike price of $100 million. In a second agreement, Cammeby's Funding III LLC (Cam III) agreed to lend $100 million to SVCare. Cam III and Cam Equity were controlled by the same person. In anticipation that Cam Equity would exercise the option, SVCare commenced an action alleging that the option was unenforceable because the consideration underlying its agreement to offer the option was contingent on Cam III loaning it $100 million, which SVCare claimed was never paid. Cam Equity brought a separate lawsuit seeking specific performance of the option agreement. Supreme Court (1) found in in favor of Cam Equity in the first action, concluding that the option and loan were entirely separate agreements and that SVCare could not offer extrinsic evidence regarding the $100 million loan obligation that was not mentioned in the option agreement; and (2) in the second action, determined that Cam III had, in fact, fully funded the $100 million loan to SVCare pursuant to the loan agreement. The Court of Appeals affirmed, holding that the lower court did not err in its judgment. View "Schron v. Troutman Saunders LLP" on Justia Law