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In a letter opinion, the Delaware Court of Chancery denied a motion for reargument regarding the court's decision on HC's motion for partial summary judgment. The court held that Myers failed to demonstrate that the court misapprehended the law or facts because its arguments rehashed arguments it raised in its opposition to HC's motion; raised entirely new arguments; or raised arguments that reflected a misapprehension of the court's decision. The court rejected Myers' argument that the court "inexplicably" and incorrectly concluded that Myers' objection to HC's first claim did not apply to items that overlap in HC's first and second claim notices; that once Myers objected to an indemnification claim, HC could not "override" Myers' objection by making another claim; and that even if Myers "irrevocably waived the right to contest distribution" of the escrow property, it may still raise "defenses" to prevent "distribution of the entire escrow amount." View "The HC Companies, Inc. v. Myers Industries, Inc." on Justia Law

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Plaintiff filed a verified complaint against West to inspect its books and records under Section 220 of the Delaware General Corporation Law (DGCL). The Delaware Court of Chancery held in this post-trial opinion that plaintiff has demonstrated, by a preponderance of the evidence, a credible basis from which the court can infer that wrongdoing related to the merger may have occurred. The court rejected West's argument that the Corwin doctrine would stand as an impediment to an otherwise properly supported demand for inspection under Section 220. The court explained that any contrary finding would invite defendants improperly to draw the court into adjudicating merits defenses to potential underlying claims in order to defeat otherwise properly supported Section 220 demands. Furthermore, the court should not prematurely adjudicate a Corwin defense when to do so might deprive a putative stockholder plaintiff of the ability to use Section 220 as a means to enhance the quality of his pleading. Therefore, the court ordered a judgment entered in favor of plaintiff and directed West to allow inspection of the books and records at issue. View "Lavin v. West Corp." on Justia Law

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In a memorandum opinion, the Delaware Court of Chancery held that the Stock Purchase Agreement allowed Vestcom to claim the full amount of the transaction tax deductions (TTDs) pre-closing. The TTDs in this case arose from the sale of a manufacturer of retail shelving labels between sophisticated financial actors. After reviewing the evidence presented at trial, the court held that the Agreement allowed only one objectively reasonable meaning, namely that Vestcom was free to claim 100% of the TTDs to reduce pre-closing taxable income, but VPH would have to remit 50% of the value of any post-closing refunds or reductions in taxable income to LSVC. View "LSVC Holdings, LLC v. Vestcom Parent Holdings, Inc." on Justia Law

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Debra Sands appealed the grant of summary judgment in favor of Menard, Inc. Sands and John Menard, Jr., were involved in a romantic relationship from late 1997 to April 2006. Sands alleged that from 1998 until 2006 she cohabitated with Menard and they engaged in a "joint enterprise" to work together and grow Menard's businesses for their mutual benefit. Menard and his affiliated entities argued that by failing to comply with Supreme Court Rule 20:1.8(a), which regulated business transactions between lawyers and their clients, Sands was precluded from seeking an ownership interest in any of Menard's various business ventures. As to the claim she characterized as a “Watts” unjust enrichment claim, the Wisconsin Supreme Court concluded Sands failed to allege facts which, if true, would support her legal conclusion that she and Menard had a joint enterprise that included accumulation of assets in which both she and Menard expected to share equally. Furthermore, the Court held SCR 20:1.8(a) could guide courts in determining required standards of care generally; however, it could not be used as an absolute defense to a civil claim involving an attorney. Finally, the Court concluded the court of appeals properly granted summary judgment to Sands on Menard, Inc.'s counterclaim for breach of fiduciary duty, and to the Trustees on their motion for summary judgment dismissing Sands' claim. View "Sands v. Menard, Jr." on Justia Law

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After the dissolution of Gentix, a biotech research company established as a Delaware LLC with headquarters in Boston, Johnson and Rose, former Gentix board members and investors were found personally liable under G. L. c. 149, 148 (Wage Act), for failing to pay wages owed to the former president of Genitrix, Segal. On direct appellate review, the Massachusetts Supreme Judicial Court reversed, concluding that the Wage Act does not impose personal liability on board members, acting only in their capacity as board members, or investors engaged in ordinary investment activity. To impose such liability, the statute requires that the defendants be "officers or agents having the management" of a company, G. L. c. 149, 148. The defendants were not designated as company officers and had limited agency authority. The only officer having the management of the company was the plaintiff, not the defendants. View "Segal v. Genitrix, LLC" on Justia Law

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Lincoln Land Company, LLC (“Lincoln Land”) appealed a district court’s judgment which dismissed Lincoln Land’s complaint. LP Broadband cross-appeals the district court’s denial of LP Broadband’s motion for attorney fees. The dispute arose over LP Broadband’s placement and use of antenna equipment on the rooftop of a grain silo owned by Lincoln Land, but leased to General Mills. General Mills had allowed MicroServ Computer Technologies, Inc., (“MicroServ”) (which merged with LP Broadband in 2013) to utilize the rooftop space on the property since March 2000, in exchange for $50 per month. Lincoln Land subsequently purchased the grain silos and, in 2010, executed a lease agreement with General Mills, which specifically prohibited a sublease of the property without prior written consent from Lincoln Land. Notwithstanding the lease provision, General Mills continued to sublease the rooftop space to LP Broadband. Upon discovering that LP Broadband was using the rooftop space, Lincoln Land filed a complaint against LP Broadband for unjust enrichment. Therein, Lincoln Land argued that it had conferred a benefit to LP Broadband and that it would be inequitable for LP Broadband to retain such a benefit without compensating Lincoln Land. The district court dismissed the complaint after concluding that Lincoln Land failed to establish that it, not General Mills, had conferred the benefit to LP Broadband. Finding no reversible error in the district court judgment, the Idaho Supreme Court affirmed. View "Lincoln Land Co v. LP Broadband" on Justia Law

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The oral agreement at issue in this appeal was made in connection with a transaction by which three companies, of which Albert Kanno was the majority shareholder, were sold to two Delaware corporations. The transaction was documented principally by three writings, each of which had an integration clause. A jury found in favor of Kanno and against Marwit Capital Partners II, L.P. (Marwit Capital) and Marwit Partners, LLC (Marwit LLC) on Kanno’s claim for breach of the oral agreement. After the jury rendered its verdict, the trial court concluded the parol evidence rule did not bar Kanno’s breach of contract claim and that the oral agreement was enforceable. Marwit Capital and Marwit LLC (together, Marwit) appealed. The Court of Appeal concluded the three written agreements were at most partial integrations, and, therefore, the oral agreement was enforceable if its terms did not directly contradict and were consistent with those three agreements, and the Court found no direct contradiction or inconsistency. View "Kanno v. Marwit Capital Partners II" on Justia Law

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West Central Cooperative was an agricultural cooperative owned by farmers. Westco Agronomy Co., L.L.C. was a wholly-owned subsidiary of West Central formed in 2005 for the purpose of streamlining delivery of agronomy products, including seed, fertilizer, and chemicals. In 2002, Westco hired Chad Hartzler to work in the agronomy division selling seed and eventually chemicals. He was later promoted to sales director but retained oversight of some of Westco’s largest accounts, including the Wollesens. A dispute arose over the relationships of these parties, resulting in a three-week jury trial and a substantial damages verdict in favor of the customer and against the cooperative. The Iowa Supreme Court limited its consideration of the case to three matters raised in the cooperative’s application for further review: (1) the district court properly denied the cooperative’s motion for new trial based on inconsistent verdicts; (2) the district court did not abuse its discretion in denying the cooperative’s pretrial motion to have equitable issues tried first; and (3), with respect to the constitutionality of Iowa Code section 706A.2(5) (2011), the statute unconstitutionally shifts the burden to the defendant. Specifically, any person who provides property or services that end up being used to facilitate “specified unlawful activity” must prove his or her own lack of negligence to avoid liability. However, the Supreme Court found the burden-shifting provision contained in section 706A.2(5)(b)(4) could be severed from the rest of the statute. Accordingly, while the Court otherwise affirmed the district court, it reversed the district court’s dismissal of this claim. View "Westco Agronomy Company, LLC v. Wollesen" on Justia Law

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A taxpayer that conducts business in multiple states must apportion its business revenue among the states in which it does business. Texas Tax Code section 171.106 provides for such apportionment under a single-factor formula, which compares the taxpayer’s gross receipts derived from its Texas business to its gross receipts everywhere. Section 141.001, however, adopts the Multistate Tax Compact, which sets out a three-factor formula for apportioning“business income” for an“income tax” and provides that a taxpayer subject to a state income tax may elect to apportion its income “in the manner provided by the laws of such state” or may elect to apportion using the Compact’s three-factor formula. The appeals court affirmed the trial court’s summary judgment, holding that apportionment of the Texas franchise tax is exclusively the province of chapter 171. The Supreme Court of Texas affirmed. Section 171.106 provides the exclusive formula for apportioning the franchise tax and, by its terms, precludes the taxpayer from using the Compact’s three-factor formula.The Compact is severable and contains no unmistakable language waiving the state’s exercise of the sovereign tax power. Nothing in the Compact expressly prohibits the states from adopting an exclusive apportionment method that overrides the Compact’s formula. View "Graphic Packaging Corp. v. Hegar" on Justia Law

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In these consolidated cases stemming from the sale and purchase of a partnership interest, SP appealed from a judgment of dismissal following the granting of the trial court's own motion for judgment on the pleadings in SP's breach of contract and conversion action against defendant. SP also appealed from the post-judgment order granting defendant his contractual attorney fees. The Court of Appeal held that SP adequately stated causes of action for breach of contract and conversion and reversed the judgment. In this case, even if the Necessary Approvals were legally required to effectuate a transfer of the Partnership Interest, SP's failure to obtain them was not fatal to its breach of contract claim. Furthermore, SP's conversion claim was not a generalized claim for money but rather a claim for a specific identifiable sum of money received by defendant for SP's benefit. Finally, the court reversed the order awarding fees. View "SP Investment Fund I LLC v. Cattell" on Justia Law