Daily Archives: September 16, 2021

BONNER et al. v. BRUNSON et al.

Fred Bonner and Bonner Roofing & Sheet Metal Company, Inc. (collectively Bonner) sued T.I. Brunson, LLC and Thomas I. Brunson, individually, to collect over $288,000 claimed due for roofing work done pursuant to a subcontract with the LLC on a condominium construction project on which the LLC acted as the general contractor. At issue is Bonner’s claim that Thomas Brunson (the owner and controlling member of the LLC) is personally liable for the alleged debt of the LLC because he abused the form of the LLC and is therefore no longer protected by the veil of a separately maintained LLC. Because we find no evidence in the record to support this claim, we conclude Brunson was not personally liable and affirm….

MEYER v. OKLAHOMA ALCOHOLIC BEVERAGE LAWS ENFORCEMENT COMMISSION

This is an appeal from the district court’s reversal of the declaratory ruling of the Oklahoma Alcoholic Beverage Laws Enforcement Commission (ABLE) that a newly created form of business entity, a limited liability company (LLC), is not entitled to receive and hold a retail package store license. Wanda L. Meyer, holder of a retail package store license, initiated these proceedings when she petitioned ABLE requesting a declaratory judgment that she could hold the license as an LLC, a business entity authorized by the Oklahoma Legislature in 1992 through the adoption of the Oklahoma Limited Liability Company Act (OLLC Act). . . . ABLE denied the petition, thus holding that an LLC is not eligible to hold a retail package store….

M AVALON INVESTMENTS, LLC v. NISCHAN

On February 6, 1996, the plaintiffs, JM Avalon Investments, LLC (Avalon) and William J. Gaspero, filed a seven-count complaint alleging conversion, fraud, negligence, two counts of breach of loan agreements, and two counts in unjust enrichment against the defendants, Michel and Lori Nischan. The plaintiffs allege the following facts in their complaint. On January 27, 1994, Avalon was formed with Gaspero and Lori Nischan as its members, for the purpose of operating a restaurant in Stamford, Connecticut known as “Miche Mache.” Michel Nischan, the husband of Lori Nischan served as the chef and general manager of Miche Mache, and was assisted in the management by Lori Nischan. The plaintiffs also allege that the defendants converted cash and property of Miche Mache; fraudulently….

Select a limited liability company statute in your state or a state near you, and determine the answers to the following questions based upon that statute:

a. What is the longest permissible period of duration for the limited liability company?

b. Is the company managed by members or managers?

(1) If the company is managed by managers, how are they elected?

(2) If the company is managed by members, how do they meet and vote on management matters?

c. Can a membership interest be transferred without the consent of the other members? If consent is required, what percentage of members must approve a transfer of a membership interest?

d. What type of consideration is permitted for the purchase of a membership interest?

e. What types of business may….

Susan Rogers, Ed Naylor, and Adam Golodner are starting an environmental waste disposal business in Richmond, Virginia. The business will be called “Recycled Refuse,” and each of them will be involved in managing and operating the business. Susan will be the primary administrator of the business, Ed will be the salesperson, and Adam will handle the financial affairs. They will each contribute 50,000 to begin the business, and they expect to share all benefits from the business equally. None of them will receive a salary, but each of them would like to draw 5,000 advances monthly against the profits of the business, and they will agree to return any draws in excess of their respective share of profits within 30 days of the end of each year (when their annual….

UNION BANK v. ANDERSON

[Sam Hamburg Farms, Inc. (SHF, Inc.) was a California corporation owning approximately 6200 acres of farming property in Merced and Fresno Counties. In 1975, John Anderson and Henry Stone negotiated to purchase the 6200 acres, intending to buy the land as an investment, farm it, then break it up and sell it. In order to comply with Federal Bureau of Reclamation requirements for federal water rights on the property, Anderson and Stone decided to buy the stock of SHF, Inc., and thereby acquire the control of the land, buildings, equipment, crops, and water rights. The purchase price was paid by a promissory note for $2,650,000, payable in ten annual installments commencing in January 1977, and the note was secured by a deed of trust….

ICELAND TELECOM, LTD. v. INFORMATION SYSTEMS AND NETWORKS CORPORATION

Iceland Telecom, Ltd. (“Plaintiff”) brought this diversity action against Arvin Malkani (“Malkani”), ISN Global Communications, Inc. (“ISNGC”), and Information Systems and Networks Corporation (“ISN”)(collectively, “Defendants”) alleging in two counts breach of contract and unjust enrichment. ISNGC was a telecommunications company incorporated in 1998 under the laws of the State of Delaware. The company was founded by Malkani. ISN was founded in 1980 and its CEO/President and sole-owner is Malkani’s mother, Roma Malkani. Iceland Telecom is a telecommunications service provider in Iceland. Iceland Telecom owns Skima, Ltd. (“Skima”), which provides internet telephone services.

Arvin Malkani was the sole-owner, sole stockholder, CEO, and president of ISNGC. The three directors of the company were Malkani, his mother Roma, and his sister Sabrina….

Terry and Perry Gorrell formed a corporation with Eddy and Betty O’Keefe in 1989. Terry and Perry own 50% of the outstanding stock and Eddy and Betty own 50% of the outstanding stock. Terry, Perry, Eddy, and Betty are all members of the board of directors, and they are officers of the corporation as follows:

Terry—President

Eddy—Vice-President

Betty—Secretary

Perry—Treasurer

Today, Terry and Perry cannot stand Eddy and Betty, and the feeling is mutual. They have not been able to agree on anything for the past year. The operations of the corporation are at a standstill because of their personal attitudes toward each other. What could you recommend so this corporation could become functional again?

AKERMAN v. ORYX COMMUNICATIONS, INC.

This case arises out of a June 30, 1981, initial public offering of securities by ORYX, a company planning to enter the business of manufacturing and marketing abroad video cassettes and video discs of feature films for home entertainment. ORYX filed a registration statement and an accompanying prospectus dated June 30, 1981, with the Securities and Exchange Commission (SEC) for a firm commitment offering of 700,000 units. Each unit sold for $4.75 and consisted of one share of common stock and one warrant to purchase an additional share of stock for $5.75 at a later date.

The prospectus contained an erroneous pro forma unaudited financial statement relating to the eight month period ending March 31, 1981. It reported net sales of $931,301, net….

BIREN, v. EQUALITY EMERGENCY MEDICAL GROUP, INC.

In 1988, emergency room physicians Biren, Kenneth Corre, Emanuel K. Gordon, David Kalmanson, and Michael Vitullo formed Equality Emergency Group, Inc. to provide emergency room services to hospitals under contract. Each physician owned 20 percent of the corporation’s shares, was a member of the board of directors, and served as a corporate officer. In 1991, Biren became the chief financial officer and later assumed responsibility for oversight of patient billing. In 1995, the physicians formed E.E.M.G.- SIMI, Inc. to segregate accounting and billing for Simi Valley Hospital from other hospitals that Equality serviced. The shareholder physicians treated the two corporations as one business.

On November 14, 1990, the five physicians entered into a written Agreement detailing their relationship and governing management….