Justia Business Law Opinion Summaries

Articles Posted in South Dakota Supreme Court
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The Supreme Court affirmed in part and reversed in part the judgment of the circuit court dismissing this complaint alleging several breaches related to conduct allegedly occurring in connection with the ownership and operation of a pet grooming business, holding that several causes of action were improperly dismissed.The complaint in this case alleged claims for breach of fiduciary duty, breach of the duty of loyalty, breach of the duty of care, conversion, and unjust enrichment, and a separate cause of action for punitive damages. The circuit court dismissed the complaint in its entirety for failure to state a claim. The Supreme Court largely reversed, holding (1) Plaintiff properly instituted this action against Defendant; (2) the circuit court erred in dismissing the causes of action for breach of the duty of loyalty, breach of the duty of care, conversion, and unjust enrichment; and (3) Plaintiff's request for punitive damages was sufficiently pled. View "Mach v. Connors" on Justia Law

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Robinson purchased grain bin monitoring equipment for his Spink County farm, financed through an Equipment Lease Agreement with Northland. Northland’s place of business is in Minnesota. The Lease included a forum selection clause requiring any suit filed by either party to be filed in Stearns County, Minnesota. After Robinson stopped making payments, Northland filed suit in Spink County, South Dakota, where Robinson resided. Robinson objected, claiming that he intended to pursue claims against Northland and others in Minnesota for the defective equipment. In granting Northland summary judgment., the circuit court treated Robinson’s objection as a question of venue and determined that Robinson failed to make a timely objection in Spink County.The South Dakota Supreme Court reversed and remanded, ordering the dismissal of the Spink County action. The court applied Minnesota law consistent with the Lease's choice of law provision and stated that the statutory venue provisions have no application to the question of the enforceability of the contractual forum selection clause. Robinson’s actions in responding to the suit do not support a waiver determination under the Rules of Civil Procedure. The Lease does not indicate that the forum selection clause was intended to solely benefit Northland, or that the mandatory language requiring “any suit by either of the parties” could be unilaterally waived. View "Northland Captial v. Robinson" on Justia Law

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The Supreme Court affirmed the judgment of the circuit court dismissing Defendants' 2013 motion to enforce a purported settlement agreement and to compel arbitration and dismissing Defendants' claim for unjust enrichment after a trial, holding that the circuit court did not err.Plaintiff brought suit against Defendants, his brothers, to dissolve their family partnership and asserting claims for breach of contract and breach of fiduciary duty. Defendants asserted multiple counterclaims based on Plaintiff's alleged misappropriation of partnership assets. This appeal concerned only the circuit court's denial of Defendants' motion to enforce the settlement agreement and to compel arbitration and the dismissal of Defendants' claim for unjust enrichment. The Supreme Court affirmed, holding that the circuit court (1) did not err in denying Defendants' motion to enforce the purported settlement agreement and to compel arbitration; and (2) did not err in denying Defendants relief on their claim for unjust enrichment. View "Paweltzki v. Paweltzki" on Justia Law

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The Supreme Court dismissed this appeal seeking review of four adverse pretrial decisions after the circuit court granted summary judgment on some of the parties' claims, holding that accepting appellate jurisdiction would lead to piecemeal litigation of the myriad claims among the four parties.When one of three founding members of a cooperative grazing association died, his estate invoked a provision of the bylaws of the association to withdraw real estate that was previously contributed to the association and sell it to a third party. Another member objected, leading to this litigation. The circuit court granted summary judgment to the estate as to certain claims but did not determine all of the various claims among the parties. Two parties appealed, seeking review of four adverse pretrial decisions. The Supreme Court dismissed the appeal, holding that the justification for the S.D. Codified Laws 15-6-54(b) certification was not readily apparent from the record. View "Nelson v. Campbell" on Justia Law

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The Supreme Court reversed the judgment of the circuit court granting partial summary judgment in favor of Smith Angus Ranch Inc. (SAR) on its claims for breach of fiduciary duty and self-dealing, holding that the circuit court erred by excluding extrinsic oral evidence in this case.In its complaint, SAR alleged that Travis Hurst, while serving as a director and officer of SAR, wrongfully acquired SAR assets and made improper purchases using SAR funds. After the court prohibited Hurst from presenting extrinsic oral evidence to show he was authorized to carry out the contested transactions, SAR moved for partial summary judgment on its claims for breach of fiduciary duty and self-dealing. The court granted partial summary judgment for SAR. The Supreme Court affirmed, holding (1) the circuit court erred by excluding extrinsic oral evidence; and (2) questions of fact existed precluding summary judgment. View "Smith Angus Ranch v. Hurst" on Justia Law

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The Supreme Court affirmed the circuit court's grant of summary judgment in favor of Defendants with respect all of Plaintiff's claims except for counts four and five, holding that the circuit court did not err in granting summary judgment.This litigation arose from Aqreva, LLC's purchase of medical practice management service from Eide Bailly, LLP. Aqreva sued Eide Bailly, Shelly Kampmann, Lee Brandt, and LJB, Inc. claiming breach of contract and various torts, alleging that Defendants violated non-compete, non-solicitation, and confidentiality clauses in several contracts and that Defendants committed, among other torts, civil conspiracy and fraud. The circuit court granted summary judgment in favor of Defendants with respect to all claims except for those concerning Kampmann's employment agreement and the alleged tortious interference with a contract by Brandt and LJB. The Supreme Court affirmed, holding the the circuit court properly granted summary judgment on counts one through three and six through nine. View "Aqreva, LLC v. Eide Bailly, LLP" on Justia Law

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The Supreme Court affirmed the decision of the circuit court granting a motion to dismiss this action brought by a group of investors in the federal EB5 immigrant investment program against various agencies that implemented the program in South Dakota, holding that sovereign immunity barred this action.In this case arising from implementation of the EB5 immigration investment program in South Dakota, a group of investors (Claimants) filed an amended complaint against several agencies that implemented the program, alleging fraud, breach of fiduciary duty and aiding and abetting breach and requesting to pierce the corporate veil. The circuit court held that Claimants' suit was barred by sovereign immunity. The Supreme Court affirmed, holding (1) Claimants failed to show that an express waiver of sovereign immunity applied to the State's activities with the EB5 Program; and (2) therefore, the circuit court properly granted the State's motion to dismiss. View "LP6 Claimants, LLC v. S.D. Department of Tourism & State Development" on Justia Law

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The Supreme Court dismissed for lack of appellate jurisdiction Appellants' appeal from the circuit court's order granting summary judgment dismissing some but not resolving all of the parties' claims, holding that the circuit court's summary judgment order was indisputably not final.The circuit court's order granting summary judgment did not resolve all of the parties' claims, and it was not certified as a final decision prior to Appellants' appeal. The Supreme Court dismissed the appeal without reaching the merits of the appeal, holding that because the circuit court resolved only part of the case and the summary judgment order did not cite S.D. Codified Laws 15-6-54(b) (Rule 54(b)), did not designate the order as final, and was not accompanied by a reasoned statement supporting a Rule 54(b) certification, this Court lacked appellate jurisdiction. View "Huls v. Meyer" on Justia Law

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The Supreme Court reversed the judgment of the circuit court ordering dissolution and the sale of Dragpipe Saloon, LLC's assets, holding that the drastic remedy of judicial dissolution was not supported by the evidence in this case.In their efforts to sell their membership interests two members of Dragpipe requested judicial dissolution and an order authorizing the sale of Dragpipe's assets. The circuit court granted the request for dissolution, concluding that judicial dissolution was authorized under S.D. Codified Laws 47-34A-801(a)(4)(i) and (iii) because Dragpipe's economic purpose was unreasonably frustrated and because it was not reasonably practicable to carry on its business under the provisions of the operating agreement. The Supreme Court reversed, holding (1) the circuit court erred in its interpretation of the operating agreement and in its application of sections 47-34A-801(a)(4)(i) and (iii); and (2) the economic purpose was not likely to be unreasonably frustrated by Dragpipe's continued operation, and the LLC was operating within the purposes stated in the operating agreement. View "Dysart v. Dragpipe Saloon, LLC" on Justia Law

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The Supreme Court affirmed the decision of the circuit court denying Appellants’ motion to intervene in a partnership dissolution action, holding that Appellants failed to meet the tripartite test necessary for intervention as a matter of right under S.D. Codified Laws 15-6-24(a)(2).Appellants entered into a farm lease/cash rent agreement with Berbos Farms General Partnership. Appellants sued Berbos Farms to recover unpaid cash rent under the lease for the years 2015. During discovery, Appellants learned that Joe and Lisa Berbos, partners in Berbos Farms, had filed a separate action to dissolve Berbos Farms. Seeking to preserve their right to payment of the 2015 cash rent in the event Berbos Farms was dissolved, Appellants move to intervene in the partnership dissolution action. The circuit court denied the motion. The Supreme Court affirmed, holding that because Appellants failed to show that the claim for unpaid cash rent might be impaired by the disposition of the partnership dissolution lawsuit, the circuit court correctly denied the motion to intervene under section 15-6-24(a)(2). View "Berbos v. Berbos" on Justia Law