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document signatureA recent decision entered by the Fifth District Court of Appeal in Daytona Beach offers a stern warning to spouses who use misconduct in order to gain access to marital funds to invest. The case makes clear that one of the potential risks of engaging in misconduct in order to make an investment may be shouldering the full amount of the debt should you and your spouse divorce. In the Fifth Circuit case, a director of, and investor in, a Florida bank that failed had a $100,000 loan count as his separate, non-marital debt because he forged his wife’s signature on the loan documents.

Barry Mills was on the Board of Directors and a major investor in Florida State Bank, a startup bank established in 2007. Each of the bank’s directors was required to make an investment, and Mills’ portion was more than a quarter-million dollars. Mills’ wife, Brenda Mills, knew that her husband was a director of, and investor in, the bank, but she did not know the extent of the investment. Since the husband did not have sufficient cash available to make the full required investment, he acquired an additional $100,000 by taking out a second mortgage on the marital home. Fearing that the wife would not approve of the investment and the second mortgage, the husband did not ask her to sign the loan documents and instead forged her signature on the paperwork.

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Telemundo LogoIn many areas of business, the “playing field” is highly competitive. Businesses compete against rivals for clients or customers, and they also compete with one another when it comes to securing and retaining top employees. In a recent dispute pitting two Spanish-language TV networks against each other, the Third District Court of Appeal ruled that Telemundo was entitled to an injunction that would prevent one of its network executives from starting work at a rival network, TV Azteca.

The executive in this case was Joshua Mintz. Telemundo Media LLC and he signed a contract that began on January 1, 2015 and ran through December 27, 2017. The agreement also gave Telemundo an irrevocable option to extend Mintz’s deal by one more year. The agreement also included a non-competition clause. That provision stated that Mintz could not go to work for any “Spanish-language media competitor of Telemundo… within the United States” for a period of six months after the termination of his employment with Telemundo. The agreement also bound both parties to go through the network’s alternative dispute resolution process if a non-competition issue arose.

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nightclubA member of an LLC that owned a short-lived Miami Beach nightclub was recently determined not to be individually liable for paying reimbursement to another member who withdrew from the LLC. The Stok Folk + Kon client won his case before the Third District Court of Appeal because, as the appeals court determined, LLC agreements generally do not create individual liability unless the document says so explicitly, and the agreement for this LLC included no express provisions requiring individual liability for reimbursing withdrawing members.

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Futbol ArgentinoIn most commercial contract situations, a breach of contract lawsuit is straightforward. If an entity contracts to receive compensation in exchange for performing certain services, and it receives no compensation even after performing its promised services, it may have a breach of contract case. In one recent case, a Florida marketing firm was in that situation but was not able to pursue a breach of contract case in the Florida courts because one of the entities that was an essential party to resolving the case was the government of Argentina, and federal law states that governments like Argentina’s are immune from suit, leaving the Third District Court of Appeal to affirm a dismissal and the firm unable to pursue its case.

The marketing firm, GMI LLC, inked an agreement in early 2007 with the body that governed football (a/k/a soccer to U.S. audiences) in Argentina. The one-page contract gave GMI exclusive rights to the marketing, negotiating, and execution of a deal that would cover the sale of the football association’s media rights for a two-decade period, starting with the 2014-15 football season. The agreement stated that the association would not pay GMI, but the association and the buyer of the media rights would reach their own agreement regarding GMI’s compensation, and the buyer would pay the marketing firm.

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checkbook-6With commercial litigation comes the need to make many very important decisions, both before and during trial. In some cases, one of those decisions is whether or not to accept an offer of judgment from the other side. One should weigh this decision carefully, since a refusal could potentially leave you on the hook for the other side’s attorneys’ fees. A recent Fourth District Court of Appeal case upheld an award of attorneys’ fees, rejecting the plaintiff’s claim that the offer of judgment statute did not apply to its situation.

The case started as a dispute between two competitors in the yacht paint business. MYD Marine Distributor, Inc. and MYD Mid-Atlantic, Inc. sued International Paint LLC, International Paint, Ltd., Donovan Marine, Inc. and Gold Coast Marine Distributor, claiming that International, Donovan, and Gold Coast all violated state antitrust laws by conspiring to eliminate MYD as the distributor of a particular brand of yacht paint, which had the effect of fixing the market price of that paint. The lawsuit also included claims for breach of contract and restraint of trade.

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dentistDividing a couple’s assets as part of a divorce case is often a challenging task in many situations. This can be especially so in cases involving spouses who own businesses. The case may present issues of high-value assets, debts, or both, depending on the business’ success or failure. In one long-running South Florida case involving a dentist and his wife, the husband lost his effort to increase the negative-value calculation of his business because, according to a 4th District Court of Appeal ruling, he was not entitled to offer new evidence about the value of his practice when the case went back before the trial court after an appeal. The value of the couple’s assets was not one of the issues sent back to the trial court by the appeals court, so the admission of that evidence and the resulting change in the couple’s equitable distribution should never have happened.

The couple’s divorce case actually began several years ago. In the original case, the husband put forward evidence that his dental practice was actually deeply in the red. After the trial court issued its order of dissolution, the husband pursued an appeal on several grounds, including the way in which the court treated the couple’s home in the equitable distribution and the requirement that the husband obtain and maintain a $2 million life insurance policy to protect the alimony and child support awards. The husband also argued that the trial court failed to account for the negative value of his dental practice.

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hacker-public-domainIn a commercial contract breach case with facts that were very timely, a software company sued its digital marketing services firm for a breach of contract after the marketing firm got hacked, and the software company’s half-a-million-strong list of customer emails was potentially compromised. The 11th Circuit Court of Appeals adopted the ruling of a lower court that sided with the marketing firm, since recovery for the type of contract damages the software company incurred was barred by the terms of the agreement, and the software company didn’t present the necessary evidence to go forward on its negligence claim. The ruling is an important one in terms of assessing just how far an entity’s obligation under a contract’s confidentiality provision reaches.

The underlying events in this case dated to a contract executed in 2005, in which Silverpop Systems, Inc. agreed to provide digital marketing services to Leading Market Technologies, Inc. As part of this agreement, Silverpop was authorized to access Leading’s master list of nearly 500,000 email addresses. This list represented the email of everyone who ever registered for Leading’s MarketBrowser product for researching, monitoring, and analyzing securities. The agreement, as is common in many commercial contracts, contained a provision requiring each side to hold sensitive information in confidence.

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january-calendar-600x400In an issue without prior precedent in the Florida courts, the 2d District Court of Appeal addressed an important question regarding the amount of time a party has to challenge a fraudulent transfer. In the recently decided case, the court ruled that a creditor waited too long because the period for filing claims started when the creditor learned of the existence of the allegedly fraudulent transfer, not when it discovered that the transfer was a fraudulent one.

The origin of the business relationship between a St. Petersburg-based landlord, F/R 550, LLC and F/R 3329, LLC, and its tenant, National Auto Service Centers, Inc., was the execution of two 30-year leases in 2005. National, which was in the auto repair business, ran two of its repair shops at a pair of properties owned by the F/R companies. Two years later, National sold off some of its locations, including both of the shops located in the F/R-owned properties. The buyers executed promissory notes to National, which it subsequently assigned to its parent company. By late 2008, nobody was making rent payments to F/R. The landlord sued and obtained a $2.1 million judgment.

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home-interior-designA Bal Harbour-based property company received new life in its breach of contract battle with a Miami interior design company. The 3d District Court of Appeal ruled that the trial court in the case should not have refused the property company’s request to modify its court filing answering the designer’s complaint, because the property company’s proposed amendment offered no risk of prejudicing the designer, abusing the legal process, or being futile.

The litigation occurred after RV-7 Property, Inc. hired Stefani De La O, Inc. to provide interior design services. A dispute arose and the designer sued, accusing the property company of failing to pay for services rendered. RV-7 acknowledged the contract at first but argued that the designer was the one who failed to perform.

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Screen Shot 2016-03-10 at 5.58.58 PMIf you find yourself needing to utilize the court system in order to sort out a dispute between yourself and another of your fellow members of a limited liability company, it is important to understand what you’ll need to win your case. In a dispute among members of a sun visor LLC, one member’s lawsuit ultimately failed when the Fifth District Court of Appeal decided that he did not have enough of the correct type of evidence to succeed. The member’s case rested largely upon his own affidavit, and that affidavit did not include required information indicating how the member came to know the things about which he alleged to have “personal knowledge.”

The case emerged in the wake of a dispute between members of a limited liability company. The company sold Vizers, a variety of sun visor product that was brightly colored and floated in water. Stephen Johns owned 50% of the LLC, Kirk Dannels owned 30%, and a third member owned 20%. After the dispute between Dannels and Johns flared, Dannels sued on behalf of himself and the LLC. Dannels alternately accused Johns of orchestrating the sale of LLC assets without consulting the other two owners and “purport[ing] to sell the assets.” Dannels also alleged that he demanded an accounting (access to certain of the LLC’s books and records), but Johns did not provide that accounting. Additionally, Dannels alleged that he was wrongfully kicked out of the LLC.

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