If you’ve been practicing law for more than a few years, you’ve undoubtedly been asked to "domesticate" in North Carolina’s courts a judgment entered in another state. A pretty easy task you think, covered by North Carolina’s adoption of the Uniform Enforcement of Foreign Judgments Act, N.C. Gen. Stat. Sec. 1C-1701 to -1708.
Let’s say
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You don’t see a trademark infringement action in the Business Court every day, let alone a TRO decision, but a case with both came along last Friday in SCI Carolina Funeral Services, LLC v. McEwen Ellington Funeral Services, Inc. Moreover, this was a common law trademark case, with no federal registration — or even a
If you are a lawyer practicing in the Middle District of North Carolina, you will be excited about Standing Order #2, issued by the Judges of the Court on January 8th.
The Order authorizes the use of cellphones — even those with cameras — in the courthouses of the District. The banning of cellphones
The lesson in the Business Court’s first opinion of the year, Allen Smith Investment Properties, LLC v. Barbarry Properties, LLC, 2013 NCBC 1 is to be ready to present your calculation of damages at the summary judgment stage or to be prepared to have your claim dismissed.
The Plaintiffs in Allen Smith were suing
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It’s hard to like the result in Wake County v. Hotels.com, LP, 2012 NCBC 61. The case is a consolidation of cases brought by several North Carolina counties (Mecklenburg, Wake, Dare, and Buncombe) against Hotels.com and other internet travel sites (like Orbitz.com, priceline.com, and travelocity.com). Hotels.com, the first named Defendant, is an online booking service that promises the lowest available rates for a multitude of hotels.
The NC County Plaintiffs allege that Hotels.com and the other Defendants contract with hotels for rooms at a discounted rate, and then sell the rooms to consumers at a higher rate. Their beef is over the non-payment by hotels.com of the Occupancy Tax ordinarily paid by hoteliers. They allege that Hotels.com and the other Defendants charge their customers for tax at the higher rate at which the hotels actually sell the room, but then only remit taxes based on the discounted rate they pay the hotel operator.
What happens to the difference? Hotels.com and the other Defendants pocket it. Shouldn’t they pay the excess collected to the counties or the North Carolina Department of Revenue? The Counties thought so.
But the upshot of Judge Murphy’s decision in the Wake County case is that the Counties had no cause of action against the Defendants. He granted summary judgment in favor of the Defendants.
The why of it took 30 pages of statutory analysis of North Carolina’s taxation scheme. The Occupancy Tax is not contained in the General Statutes. Instead, the General Assembly passed statutes authorizing counties to levy an Occupancy Tax. The counties levy the Occupancy Tax via resolutions or ordinances.
So the cases turned on the counties’ ordinances, and upon whom they placed the obligation to collect the tax. In Mecklenburg and Wake Counties, it was the "operator of a taxable establishment." In Dare and Buncombe Counties, it was the "operator of a business subject to a room occupancy tax."
Judge Murphy concluded that the Defendants were not responsible for collecting the Occupancy Tax. If you are curious about how he reached that conclusion — and you must be a state taxation junkie if you are — you can read about it in Paragraphs 33 through 53 of the Opinion.
Other Interesting Things About This Opinion
For those of you who aren’t enamored by the Occupancy Tax, you might find interesting Judge Murphy’s discussion of Rule 8 of the North Carolina Rules of Civil Procedure and his disposition of a conversion claim.
Today’s post is really a thank you to Judge Gale for delivering the Christmas gift I requested in last week’s post: a decision from the North Carolina Business Court on an open question of North Carolina’s corporate law to write about because I was tired of writing about Delaware law on this North Carolina blog.
Premier, Inc. v. Peterson, 2012 NCBC 59, decided last Friday by Judge Murphy, turned on a strict application of the parol evidence rule.
At issue was whether the defendants were entitled to a substantial earn-out payment under a Stock Purchase Agreement. The Plaintiff had purchased the Defendants’ software business of selling a Web-based surveillance
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If you are a derivative action plaintiff, and you make a demand on an LLC to take action which is then considered and rejected, may you still pursue your claims? Judge Murphy answered that question, and others relating to derivative actions under Delaware law in this week’s opinion in Scott v. Lackey, 2012 NCBC
If you’ve ever made a Motion for Costs following a win at summary judgment or a win at trial you know that the law on such motions is a quagmire. Does the trial court have discretion in determining whether to award costs to a prevailing party? Section 6-20 of the General Statutes implies
Maybe one day North Carolina will be the center of the business litigation universe, but for now the center of that universe remains in Delaware.
The Order last week in Justewicz v. Sealy Corp., 2012 NCBC 57 — in which the Business Court stayed a North Carolina class action in favor of parallel