John Buford

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On Tuesday, the Court of Appeals affirmed the Business Court’s award of summary judgment against a shareholder of three private corporations in High Point Bank & Trust Co. v. Sapona Manufacturing, Inc.  We wrote about the Business Court’s ruling last year, but here’s the quick recap:  The estate of a woman who was the daughter and granddaughter of the founders of three family-originated corporations in Randolph County sued those businesses seeking the redemption of over $3.6 million worth of stock. 

The estate asserted a Meiselman claim, seeking dissolution on the…

Continue Reading Court of Appeals Affirms Business Court Dismissal of Meiselman Claim by Shareholder’s Estate

In North Carolina, the "notice" portion of notice pleading has long been honored more in the breach.  A recent Business Court order perhaps signals that enough is enough, at least when multiple plaintiffs each are suing multiple different defendants.

Allen v. Land Resource Group of North Carolina, LLC is the oldest of a growing number of cases currently pending before the Business Court involving real estate developers who went bankrupt before their developments were completed.  The original complaint in Allen involved 22 plaintiffs, 29 defendants, and 15 causes of action.  As…

Continue Reading Blanket References to “All Defendants” Are Insufficient in Multi-Plaintiff, Multi-Defendant Complaints

The Court of Appeals faced that rarest of truffles this week:  an outcome-determinative choice of law question.  The Court adhered to its traditional roots and rejected a new test fashioned by the Business Court.

At issue in Harco Nat’l Ins. Co. v. Grant Thornton, LLP was an audit of a company providing bail and immigration bonds in North Carolina and other states.  The plaintiff, an insurance company, entered into an agreement with the bonding company on the basis of that audit.  When the bonding company went defunct, the plaintiff ultimately became…

Continue Reading Ct. App. Reverses Business Court on Audit Choice of Law Issue

We present two items today for the consideration of our loyal readers:

1.  Shameless Plug for Your Votes

The good people at Lexis, which hosts our firm’s legal blogs and many others, recently notified us that we have been nominated for consideration as one of Lexis’s Top 25 Business Law Blogs.  If you are a registered member of the LexisNexis Business Law Communities, please feel free to put in a kind word at this link.  If you are not a registered member but are so compelled that you want…

Continue Reading Like Blanche DuBois, This Blog Depends on the Kindness of Strangers

An entity can be interested (legally) in the outcome of a lawsuit, or it may simply be interested (in the go-sports-team-from-my-hometown-or-university! sense) in the outcome.  Under a recent Business Court ruling, only the former supports intervention under Rule 24.

Time Warner Entertainment Advance / Newhouse Partnership v. Town of Landis involved access to utility poles, a type of dispute committed to the Business Court under 2009 legislation. The North Carolina Association of Electric Cooperatives ("NCAEC"), an organization of 26 electric membership corporations across North Carolina, sought leave to intervene under Rule 24…

Continue Reading Trade Association May Appear as Amicus, but Can’t Intervene

As discovery of electronically-stored information ("ESI") becomes more prevalent and relevant in litigation, so too does litigation regarding the obligation to preserve ESI.  Last Friday, the Business Court issued two orders reaching opposite results on motions for "non-spoliation" orders, based on significant differences between the scope of the preservation obligations that the plaintiff sought to impose.

In Capps v. Blondeau, the Business Court previously ruled that an arbitration clause was unenforceable.  Two defendants appealed that ruling and, during the pendency of the appeal, the plaintiff moved the Court for what they called…

Continue Reading Overly Broad Discovery Requests Undercut Attempt to Prevent Spoliation

If you have visited the restroom in an office building in the last five years, chances are you’ve had the opportunity to use Georgia Pacific’s hands-free paper towel dispenser known as "enMotion."  In a published opinion released yesterday, the Fourth Circuit generally ruled in GP’s favor on trademark infringement, tortious interference, and unfair and deceptive trade practices claims.

The enMotion dispenser (pictured here) operates through an electronic motion sensor that dispenses towels without any physical contact from the user’s hands.  The dispenser was designed for use with a proprietary paper…

Continue Reading 4th Circuit High-Fives Georgia Pacific in enMotion Towel Dispenser Case

Be careful what you request in your complaint, particularly if it’s a request for judicial dissolution.  According to a Court of Appeals opinion this week, you’ll be stuck with that request if your defendant asks for the same thing.

In Bradley v. Bradley, a husband-wife team were the shareholders and officers of a legal recruiting firm, Laura Segal & Associates ("LSA").  When the couple separated, the business basically did too — the wife asserted that the husband misappropriated corporate funds and denied her access to the company’s books, records, and accounting…

Continue Reading Husband Not Allowed to Dismiss Request for Judicial Dissolution of Family Firm

If you didn’t think a case with a $55 million default judgment could get more interesting, you were wrong.  The Business Court awarded a total of $82 million in damages this week against a company that successfully set aside the lesser default judgment.

In Deutsche Bank Trust Co. Americas v. TradeWinds Airlines, Inc., three airline-related plaintiffs sued a lessor of large airplanes.  The lessor was funded by deep pockets including George Soros, but not so deep as to enter an appearance before entry of default.  One of the plaintiffs…

Continue Reading Good News? $55 Million Default Judgment Set Aside. Bad News? $82 Million Judgment Entered.

In what Judge Tennille described as a "close case," the Business Court reconsidered and reversed the prior dismissal of a breach of fiduciary duty claim, but the principles it outlined should not give litigants high hopes for reconsideration motions in general.

Charlotte-Mecklenburg Hospital Authority v. Wachovia Bank, N.A. involved an investor suing its advisors over investments gone bad.  The Hospital Authority asserted a number of claims against Wachovia, including a breach of fiduciary duty claim that the Court dismissed last October on a Rule 12(b)(6) motion.

Discovery ensued, and at the end…

Continue Reading A Tale of Reluctant Reconsideration in the Business Court