Articles Posted in Business Law

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Following the Court of Appeals’ decision in RL BB ACQ I-GA CVL, LLC v. Workman, 798 SE2d 677 (2017), the Georgia Supreme Court granted certiorari to consider two questions: (1) whether attorney fees and costs are available under OCGA 9-15-14 for conduct that occurs during the course of post-judgment discovery; and (2) whether an entity is barred from seeking sanctions under OCGA 9-11-37 by failing to request sanctions at the time it sought and obtained a protective order under OCGA 9-11-26. The Court of Appeals reversed that portion of the order awarding fees pursuant to OCGA 9-15-14, concluding that the statute spoke only to conduct occurring during the course of a “lawsuit,” which concludes at judgment, and, thus, did not apply to post-judgment discovery proceedings. The appellate court also noted, without discussion, that OCGA 9-15-14 did not apply to non-parties. With respect to the fee award made pursuant to OCGA 9-11-37(a)(4)(A), the Court of Appeals questioned whether Appellants’ “failure to request their expenses at the time they sought the protective order barred them from seeking those expenses by way of a separate motion, filed more than 40 days after the protective order was entered,” and remanded the case to the trial court to consider the waiver issue. The Supreme Court answered the first question in the affirmative, the second in the negative, and, in so doing, affirmed in part and reversed in part the decision of the Court of Appeals. View "Workman et al. v. RL BB ACQ I-GA CVL, LLC et al." on Justia Law

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After RAC Acceptance East, LLC swore out a warrant for Mira Brown’s arrest for theft by conversion of furniture that she had rented from RAC, Brown filed a lawsuit against RAC alleging malicious prosecution and other torts. The trial court entered an order granting RAC’s motion to compel Brown to arbitrate her claims pursuant to the arbitration agreement incorporated into the parties’ rental agreement. The Court of Appeals affirmed that order, concluding that whether RAC had waived its right to demand arbitration by its conduct in initiating the related criminal proceeding against Brown was a matter for the court to decide and that the trial court had correctly ruled that RAC did not waive arbitration. The Georgia Supreme Court granted certiorari, and affirmed the Court of Appeals’ judgment on the ground that the delegation provision in the parties’ arbitration agreement clearly gave the arbitrator, not the courts, the authority to determine that RAC did not waive by prior litigation conduct its right to seek arbitration, and the arbitrator’s decision on the waiver question could not be properly challenged as legally erroneous. View "Brown v. RAC Acceptance East, LLC" on Justia Law

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This appeal arose from an order modifying an existing interlocutory injunction. In December 2016, appellee Peach Trader Inc., d/b/a A City Discount and A City Discount, Inc. (“Peach Trader”), filed a complaint against appellants Jeffery and Sharon Jones, a married couple, alleging that Mr. Jones used his position as an employee to embezzle or misappropriate over $1 million from Peach Trader and take advantage of business opportunities for personal gain to the detriment of his employer. Along with its complaint, Peach Trader sought a temporary restraining order against the Joneses, and the order was granted. The Joneses then filed a motion to dissolve the order. The trial court later entered an order granting an interlocutory injunction against the Joneses that prohibited them from selling, transferring, altering, encumbering, or otherwise disposing of any assets within their custody, control, or possession. The Joneses did not attempt to appeal the order. Six months later, in July, the Joneses filed a second motion to dissolve the interlocutory injunction. During a hearing on several outstanding issues, Peach Trader’s counsel consented to certain accounts being removed from the purview of the interlocutory injunction. In line with an agreement between the parties, the trial court entered an order denying the Joneses’ motion to dissolve the interlocutory injunction but granting the motion to modify the injunction by removing the restrictions on at least one of the Joneses’ accounts. The Joneses timely filed an application for discretionary appeal with the Georgia Supreme Court seeking review of the trial court’s orders dismissing their notices of appeal. The Supreme Court vacated the trial court’s order dismissing appellant’s initial notice of appeal because Georgia law vests appellate courts with the sole authority to determine if a decision or judgment is appealable. “But that is not the end of the matter. Because an order modifying an interlocutory injunction is not subject to direct appeal under OCGA 5-6-34 (a) (4), we dismiss the appeal.” View "Jones v. Peach Trader, Inc." on Justia Law

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Icon Technology Consulting, Inc. (“Icon”) filed suit seeking to enforce a default judgment it obtained from a Missouri court against Lemcon USA Corp. (“Lemcon”). A Georgia trial court rejected Lemcon’s attempt to set aside the default judgment, and the Georgia Court of Appeals dismissed Lemcon’s appeal on the ground that Lemcon: (1) could not invoke the Georgia trial court’s inherent power to set aside a judgment within the same term of court in which it was entered; and (2) had failed to file an application for discretionary appeal as was necessary to seek review of the trial court’s order to the extent it was based on OCGA 9-11-60 (d). The Georgia Supreme Court granted certiorari to consider whether the inherent power of a Georgia court to set aside a judgment within the same term of court in which it was entered extended to a foreign judgment domesticated under OCGA 9-12- 130 et seq. The Court concluded this inherent power did not extend to domesticated foreign judgments. View "Lemcon USA Corp. v. Icon Technology" on Justia 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