Articles Posted in Business Law

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Joshua Martin sustained life-changing injuries in a brutal attack at a bus stop outside the Six Flags Over Georgia amusement park in 2007. A jury determined that Six Flags was liable for those injuries, along with the four named individual defendants who perpetrated the attack. The trial court apportioned the jury’s $35 million verdict between the parties, assigning 92% against Six Flags and 2% each against the four assailants. On cross-appeals by Six Flags and Martin, a majority of the twelve-member Court of Appeals found no error in the jury’s determination regarding Six Flags’ liability but concluded that the trial court had erred in its pretrial rulings regarding apportionment of fault, necessitating a full retrial. The Georgia Supreme Court granted certiorari to determine: (1) whether Six Flags could properly be held liable for the injuries inflicted in this attack; and (2) assuming liability was proper, whether the trial court’s apportionment error does indeed require a full retrial. After review, the Supreme Court concluded: (1) because the attack that caused Martin’s injuries began while both he and his assailants were on Six Flags property, Six Flags’ liability was not extinguished simply because Martin stepped outside the property’s boundaries while attempting to distance himself from his attackers; and (2) the trial court’s apportionment error did not require a full retrial, but rather required retrial only for the apportionment of damages. View "Martin v. Six Flags Over Georgia II, L.P." on Justia Law

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In 2011, following an apparent series of family disputes, Dorsey “Doss” Wallace filed a complaint for accounting and damages against his brothers Gary and Phillip Wallace, alleging that they had deprived Doss of his lawful interests as a shareholder of the family business, Wallace Electric Company. The parties offered competing about which agreement, if any, governed the ownership of stock in Wallace Electric, and about what the terms of those agreements would require. The trial court ultimately concluded in a bench trial that Doss should be paid $54,200 for his stock. But because the court correctly admitted that its order did not reach the factual or legal conclusions required to resolve this case, the Georgia Supreme Court vacated the order and remanded for proper consideration of, and conclusions regarding, the legal questions at issue in this case. View "Wallace v. Wallace" on Justia Law

Posted in: Business Law

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Plaintiff-appellee J.B. was injured when certified registered nurse anesthetist (“CRNA”) Paul Serdula sexually assaulted her in a surgical suite in the dental practice of defendant-appellant Goldstein, Garber & Salama, LLC ("GGS"). The Georgia Supreme Court granted certiorari to the Court of Appeals in this matter to determine whether the Court of Appeals erred in concluding that a reasonable jury could find that a third party’s sexual molestation of J.B. was an act foreseeable by GGS, whether that Court erred in affirming the trial court’s denial of GGS’s motion for a directed verdict on the issue of negligence per se, and whether GGS waived any objection to the jury verdict’s apportionment of fault. Finding the trial court should have granted GGS’s motion for directed verdict with respect to the foreseeability of Serdula's actions, it was error for the Court of Appeals to hold otherwise, the Supreme Court reversed the appellate court's judgment. Furthermore, the Court determined the appellate court erred with respect to the directed verdict on the issue of negligence per se. The Court did not reach the issue of whether GGS waived any objection to the jury's apportionment of fault. The case was remanded for further proceedings. View "Goldstein, Garber & Salama, LLC v. J.B." on Justia Law

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Drummond Financial Services, LLC and TMX Finance Holdings, Inc. were competitors in the automobile title loan business. Both companies were based in Georgia, with TMX doing business as “TitleMax.” In 2014, Drummond and several of its affiliated companies filed a lawsuit against TitleMax and several of its affiliated companies, alleging that TitleMax was “engaged in a nationwide campaign to systematically and illegally steal [Drummond’s] customers.” Based on these allegations, Drummond asserted claims against TitleMax under the laws of Georgia and various other states for trespass, misappropriation of trade secrets, tortious interference with contracts, and unfair competition. Drummond filed a motion for a nationwide interlocutory injunction to prevent TitleMax from continuing to engage in practices that Drummond alleged were tortious and illegal. Following a hearing, the trial court granted a nationwide interlocutory injunction that prohibited TitleMax from “[e]ntering any of [Drummond’s] [s]tores or the parking lots [or certain portions of the parking lots] of [Drummond’s] [s]tores” to solicit Drummond customers or to record their license plate numbers or vehicle identification numbers (other than for purposes permitted by the Driver’s Privacy Protection Act). In addition, the injunction prohibited TitleMax from offering compensation to Drummond employees to refer Drummond customers to TitleMax. TitleMax appealed. Those aspects of the injunction appeared to the Georgia Supreme Court to have been based on the claims for trespass and misappropriation of trade secrets, but the laws of trespass and trade secrets (at least in Georgia) did not support the scope of the injunction. Accordingly, the Court vacated the injunction in those respects, and remanded for the trial court to reconsider the scope of its injunction. To the extent that the parties on remand might rely on law that varies significantly from state to state, the Court reminded them that activities in one state are not due to be enjoined simply because they might be unlawful if done in another state. View "TMX Financial Holdings, Inc. v. Drummond Financial Services, LLC" on Justia Law

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In January 2016, the Superior Court of Chatham County granted a petition for an interlocutory injunction, pursuant to which it removed Leonard McCoy as President of the Board of Directors of the Willow Lakes Plantation Homeowners Association. McCoy and the Association appealed, but upon its review of the record and briefs, the Supreme Court found no error and affirmed. View "McCoy v. Bovee" on Justia Law

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After Dale Lyman and his wife, Helen, left Cellchem International, Inc. to work for a competitor, Cellchem sued the Lymans and two companies with which they had affiliated (collectively the “Lymans”), asserting claims for computer theft and computer trespass under the Georgia Computer Systems Protection Act(GCSPA, breach of fiduciary duty, and tortious interference with business relations. Cellchem claimed that the Lymans stole data from Cellchem and used it to their competitive advantage. At trial, the jury found the Lymans liable on all claims and awarded Cellchem compensatory damages and attorney fees, as well as punitive damages of $5.1 million. On appeal, the Court of Appeals reversed the judgment against the Lymans on the tortious interference claim. The Court of Appeals also remanded the case to the trial court for a new trial as to punitive damages, reasoning that, despite the fact that the tortious interference claim no longer existed to support a potential award for punitive damages, the remaining claims for breach of fiduciary duty and violations of the GCSPA could still support such a claim. In this regard, because the verdict form at trial did not designate to which claims the punitive damages were assigned, or in what proportion, a new determination had to be made with regard to punitive damages that eliminated any consideration of damages associated with alleged tortious interference and focused only on the remaining tort claims upon which the Lymans had been found liable at trial. After its review of the matter, the Supreme Court concluded that the GCSPA did not authorize an award of punitive damages. Accordingly, the Court reversed the Court of Appeals with respect to the availability of punitive damages under the GCSPA, and remanded this case with directions that the appellate court clarify that any remand to the trial court for a new trial on the issue of punitive damages could not involve any purported award for such damages based on alleged violations of the GCSPA. View "Lyman v. CellChem International, Inc." on Justia Law

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Appellant Pandora Franchising, LLC was a foreign limited liability company. In its application for certificate of authority to transact business in Georgia, Pandora identified its principal place of business in Maryland. Appellee Kingdom Retail Group (“Kingdom”) filed suit against Pandora in Thomas County Superior Court, alleging Pandora wrongfully withheld its consent to Kingdom’s bid to acquire a number of Pandora franchises. Kingdom alleged venue was proper in Thomas County pursuant to OCGA 14-2-510 (b) (4) because the cause of action originated in Thomas County. Over Kingdom’s objection, the trial court granted Pandora’s request to remove the complaint to Gwinnett County where, Pandora claimed in its notice of removal, “it maintains its registered office as its principal place of business in Georgia.” The Court of Appeals granted Kingdom’s application for interlocutory review and reversed the grant of removal. The Georgia Supreme Court granted certiorari to determine whether the Court of Appeals correctly construed OCGA 14-2-510 (b) (4) to mean that, in a claim in which the basis for venue was the allegation that the cause of action originated in the county where the claim was filed, only a corporation with its worldwide principal place of business, or “nerve center” in Georgia had the right to remove the claim to the county in Georgia where that principal place of business was located. The Supreme Court affirmed the Court of Appeals’ decision and adopted the reasoning set forth in that court’s opinion. View "Pandora Franchising, LLC v. Kingdom Retail Group, LLLP" on Justia Law

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Aster Zeru Gebrekidan filed an application for discretionary appeal to challenge her conviction and fine for violating a City of Clarkston ordinance that prohibited certain retailers of packaged alcoholic beverages from allowing on their premises any form of electronic or mechanical game machine or coin-operated device that may be used for entertainment or amusement purposes. The Georgia Supreme Court granted Gebrekidan’s application to decide whether the State’s detailed statutory scheme regulating coin operated amusement machines (COAMs) and COAM businesses in Georgia, preempted the City’s ordinance under the Uniformity Clause of the Georgia Constitution. After review, the Supreme Court concluded that the State’s COAM Laws preempted the City’s ordinance at least insofar as the ordinance applied to COAMs as defined by the state statutes. The Court therefore reversed Gebrekidan’s conviction and fine. View "Gebrekidan v. City of Clarkston" on Justia Law

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In "Vinings Bank v. Brasfield & Gorrie, LLC," (759 SE2d 886 (2014)), the Court of Appeals affirmed, among other rulings, the trial court’s determination that Vinings Bank was not entitled to summary judgment with regard to a counterclaim for conversion brought against the Bank by Brasfield & Gorrie, LLC ("B&G"). This case stemmed from a defaulted $1.4 million business loan. The bank made the loan to Wagner Enterprises, Inc., which used as collateral, a security interest in all of its accounts and accounts receivable, including Wagner's contract to provide drywall services for general contractor B&G. Wagner defaulted on the loan, and the Bank filed suit against B&G seeking to collect on Wagner's accounts receivable. B&G counterclaimed for conversion, and the parties filed cross-motions for summary judgment. The bank appealed the denial of its motion. The Supreme Court affirmed in part, reversed in part, and remanded. In affirming the trial court's judgment, the Court of Appeals did not consider whether B&G had any right to assert a counterclaim against the bank for conversion of funds due to Wagner's subcontractors. The Supreme Court found that B&G had no direct relationship with the Bank, B&G was not, itself, a subcontractor of Wagner entitled to any of Wagner's funds, B&G did not have direct contractual relationships with any of Wagner's subcontractors, and B&G had no fiduciary relationship with any of Wagner's subcontractors. Furthermore, there was no evidence that Wagner or Wagner's affected subcontractors assigned B&G any of their rights. "Therefore, even if we assume without deciding that funds in [Wagner's] account were held in a constructive trust for the benefit of [Wagner's] subcontractors, B&G is not the party to assert those rights and had no standing to do so." View "Vinings Bank v. Brasfield & Gorrie, LLC" on Justia Law

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Appellant Lori Davis, individually and as personal representative of the estate of her husband Keith L. Davis, M.D., appealed three superior court orders dated March 7, 2014, April 1, 2014, and April 21, 2014, which granted mandatory interlocutory injunctions against her and held her in civil and criminal contempt in an action brought against her husband’s estate by Steven M. Roth, M.D. and two Georgia limited liability companies Roth co-owned with Keith Davis. The plaintiffs filed suit against appellant and the Davis Estate seeking to enforce certain provisions of the companies’ operating agreements giving Roth, as the surviving member of the LLCs, an option to purchase Davis’ interests, and to otherwise establish the rights of the parties, including the ownership of certain trademarks. Appellant also appeals an April 21, 2014 order where the trial court adopted the Third Report of the Special Master and limited discovery in the pending case. Appellees, VCP South, LLC, VCP Raleigh, LLC and Mary Anne Roth, individually and as Executrix of the Estate of Steven M. Roth, M.D. cross-appealed, alleging the trial court erred in allowing the Davis Estate to maintain an ownership interest in the LLCs past the time provided for in the operating agreements, and in allowing the distribution of LLC profits accruing after Davis’ death to the Davis Estate. After careful consideration of the parties' arguments on both the appeal and cross-appeal, and finding no reversible error, the Supreme Court affirmed the superior court's orders. View "Davis v. VCP South, LLC" on Justia Law