• September 25, 2014

The paucity of record evidence in this case combined with the failure of the extensive briefs associated with the present motions to connect their presentation of copious isolated facts to a coherent legal theory makes it difficult to construct a logical and/or chronological overview of the events underlying [Plaintiff’s] claims or otherwise impose order on what appears to have been nothing short of a business relationship disaster.

The lawsuit where I got this quote was filed in October, 2010. The quote is from a court opinion this week. The case was then thrown out of court this week. But over eight months in 2012, the case went up to the U.S. Court of Appeals for the Eighth Circuit and then, after reversal, came back down to U.S. District Court Judge John R. Tunheim (D. Minn.). Judge Tunheim issued a ruling this week on the parties’ cross-motions for summary judgment post-remand.

What will any of these tenacious litigants recover from their four years of battling (aside from heartfelt thank-you notes from their lawyers and maybe a bottle of scotch or some other tokens of appreciation from their law firms around the holidays)?

Photo by darwin Bell from San Francisco, USA.

Photo by darwin Bell from San Francisco, USA.

Bupkes, nothing, nada, and zilch.

[T]he Court concludes that [Plaintiff’s] claims fall into the category of claims that allege a single wrong based on the Corporate Defendants’ refusal to recognize [Plaintiff] as a shareholder. In order to be timely, [Plaintiff’s] claims must have accrued no later than October 20, 2007 – or three years before he filed the present complaint. As explained above, under Delaware law, a cause of action accrues and the statute of limitations is calculated from the time of the wrongful act even if the plaintiff is ignorant of his cause of action. But here, the Court need not decide with precision when [Plaintiff’s] causes of action accrued because, based on the undisputed facts in the record, [Plaintiff] was on inquiry notice of his causes of action in August 2007.

As for the defendants’ counterclaims?

[T]he Court concludes that Delaware law applies to Defendants’ counterclaims, and those counterclaims are barred by the statute of limitations. Therefore, the Court will grant Whitney’s motion for summary judgment to the extent it seeks dismissal of Defendants’ counterclaims on statute of limitations grounds.

In sum, this lawsuit has been disastrous for both sides. It is impossible that either side, with the benefit of hindsight would have undertaken this futile bloodbath. It is not difficult to imagine that the parties might turn on their lawyers now (if they have not already) and attacked them for escorting them into this slaughter.

The problem, as always, is the combination of the immense cost of civil litigation and the related fact of its uncertainty.

While civil litigants can and will castigate, criticize, and complain about their lawyers — their lawyers’ high cost, their lawyers’ unreliability — they might want to consider what got them into the mess in the first place.

In the referenced Whitney v. The Guys case, it seems that two men embarked on a business venture together without having given it very much thought. Hundreds of thousands of dollars flowed between them and a myriad of entities that they may or may not have owned some of, part of, at some time or at no time. It seems that no one spent time tracking exactly what money was whose and what they were getting in return.

Now they both have less money. A lot less money. But I suppose either side might seek to appeal…

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