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Aug 31, 2018

Corporate – Nonprofit – Membership Dues – Resignation

The plaintiff-country club’s membership documents – both at the time defendants joined and at the time they resigned – required resigning members to continue paying dues and other amounts until their membership was reassigned. Since the Nonprofit Corporation Act also provides, “The resignation of a member does not relieve the member from any obligations the […]

Aug 23, 2018

Corporate – Asset Purchase – ‘Mere Continuation’ – Same Directors – Not Enough

When a company’s assets are purchased, the fact that the buyer continues the predecessor company’s operations with the same officers is not enough to hold the successor corporation liable for the predecessor company’s liabilities. We reverse the Court of Appeals’ decision, which upheld the trial court’s ruling that plaintiffs could recover from the successor corporation. […]

Jul 12, 2018

Corporate – Shareholders’ Derivative Complaint – Demand on Directors – Futility – Directors’ Liability

Where the plaintiff-shareholders allege that the defendant-directors (1) caused nominal defendant SCANA Corp. to make misleading statements, (2) approved “incentive award” pay for SCANA’s officers despite SCANA’s nuclear project being in jeopardy, and (3) failed to ensure that SCANA’s filings with the Securities and Exchange Commission were accurate, plaintiffs have sufficiently alleged [...]

Jul 6, 2018

Corporate – Piercing the Veil – Amalgamation of Interests – Manager’s Ownership Accrual

  The court formally recognizes the amalgamation of interests, or single business enterprise, theory for piercing the corporate veil. However, (1) the trial court overlooked the fact that the corporations in question were S-corporations, which are allowed to overlook corporate formalities; (2) the trial court failed to assign the burden of proof to plaintiff, as […]

May 14, 2018

Corporate – Nonprofit – Membership Dues – Resignation or Expulsion

The varying bylaws, membership offering plans, and general club rules of the plaintiff-club, a nonprofit corporation, create an ambiguity regarding the obligation of a resigning member to continue paying dues post-resignation. Some of the documents say a member is responsible for paying dues until the membership is reissued, while others say the member is only […]

Apr 4, 2018

Corporate – LLCs liable for owner’s debts

Because Delaware law likely would allow creditors to reach LLCs’ assets under the theory of reverse veil-piercing, a debtor’s companies – which owned and managed his personal assets and in which he was the sole owner – could be held jointly liable for a judgment entered against him. Background This appeal raises the question whether […]

Nov 17, 2017

Corporate – Contract – Conspiracy – Civil Practice – Personal Jurisdiction – Agency

Outpost Capital Management, LLC v. Prioleau (Lawyers Weekly No. 002-199-17, 16 pp.) (Richard Mark Gergel, J.) 2:16-cv-03684; D.S.C. Holding: As the sole member of HMB Ventures, LLC, defendant Minor had the authority to terminate HMB’s manager, defendant Prioleau; therefore, Prioleau’s termination was not the result of a conspiracy between Minor and Prioleau (allegedly as a […]

Mar 21, 2017

Corporate – Shareholders’ Derivative Action – Demand Futility – Insufficient Showing – Outside Directors

In re World Acceptance Corp. Derivative Litigation (Lawyers Weekly No. 002-080-17, 27 pp.) (Mary Geiger Lewis, J.) 6:15-cv-02796; D.S.C. Holding: An independent auditor approved the nominal defendant-corporation’s accounting practices, and plaintiff-shareholders have failed to allege specific facts to support their claims that it would have been futile for them to make a demand on the […]

Feb 10, 2016

Corporate – Antitrust Claims Fail Against Concert Promoters

It’s My Party Inc. v. Live Nation Inc. (Lawyers Weekly No. 001-028-16, 31 pp.) (Wilkinson, J.) No. 15-1278, Feb. 4, 2016; USDC at Baltimore, Md. (Motz, J.) 4th Cir. Holding: It’s My Party Inc., a regional concert promoter that owns venues such as the Merriweather Post Pavilion, loses its antitrust suit against national concert promoter […]

Mar 19, 2015

Corporate — Shareholder Shows ‘Scienter’ for Securities Fraud

Zak v. Chelsea Therapeutics Int’l Ltd. (Lawyers Weekly No. 001-047-15, 43 pp.) (Keenan, J.) No. 13-2370, March 16, 2015; USDC at Charlotte, N.C. (Cogburn, J.) 4th Cir. Holding: The 4th Circuit revives a shareholder’s suit alleging a pharmaceutical company violated federal securities laws by making materially misleading statements and omissions about the development and likely […]

Mar 10, 2015

Corporate — Family Business – Shareholder Oppression – Unclean Hands – Tort/Negligence – Breach of Fiduciary Duty & Conversion

Mason v. Mason (Lawyers Weekly No. 011-024-15, 27 pp.) (Aphrodite Konduros, J.) Appealed from Horry County (Ralph Stroman, Special Referee) S.C. App. Holding: Where the plaintiff-son himself was behind most of the schemes he complains of, his unclean hands bar him from bringing an action for stockholder oppression. We affirm the special referee’s rulings in […]

Jan 15, 2015

Corporate — Director & Shareholder – Civil Practice – Ripeness – Domestic Relations – Equitable Distribution Action

Happy Times Discount Beverage, Inc. v. Podrebarac (Lawyers Weekly No. 002-007-15, 9 pp.) (J. Michelle Childs, J.) 0:14-cv-00129; D.S.C. Holding: Although there is ongoing equitable distribution litigation between defendant and plaintiff’s other shareholder, defendant still maintains that she is a director and shareholder of plaintiff, and plaintiff’s claim – that defendant breached her fiduc[...]

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