Showing posts with label lawyers. Show all posts

Friday, August 31, 2012

Colgate V Disthene : A Stunning Decision

Judge to order liquidation of Buckingham mining company for mismanagement

Credit: ALEXA WELCH EDLUND/TIMES-DISPATCH

Willis Mountain in Buckingham County is home of the world's largest kyanite mine.

By: BILL MCKELWAY | Richmond Times-Dispatch
Published: August 31, 2012

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BUCKINGHAM, Va. --

One of the state's most closely held mining companies, fiercely controlled for more than a half century by a Buckingham County family, could go into receivership and be dissolved in coming weeks under a court decision that concludes the company oppressed minority shareholders and misapplied millions of dollars in corporate assets.

In a stunning decision issued Thursday that followed years of intrafamily legal wrangling within the Dixon family and its operation of the Kyanite Mining Corp., a Fairfax County judge said in a 41-page ruling that she will appoint a receiver "to wind up and liquidate the business and affairs of the corporation."

Circuit Judge Jane Marun Roush, named to hear the case after local judges recused themselves and who heard more than two weeks of testimony in the case earlier this summer, called her decision a "drastic" yet appropriate remedy in light of testimony that she said showed a long history of unfair stock manipulation, exorbitant salaries for company officers, and a use of assets that embellished the estates of company leaders and allowed other assets to languish unproductively.

Alan D. Wingfield, lead attorney for Kyanite, which has been represented by the Richmond-based Troutman Sanders law firm and is now known as the Disthene Group Inc., said in an email Thursday that "Disthene is considering its next steps in this lengthy court case."

Thomas M. Wolf, who tried the case with John H. Craddock Jr. and Michele K. Burke, all of LeClairRyan, issued a joint statement describing the ruling as "a historic decision that will be cited in legal treatises for years to come. It shows that there are enforceable legal protections for minority shareholders."

Disthene controls kyanite surface mines in Buckingham County south of Charlottesville that are the world's largest producer of the mineral, which is used as a heat-tolerant component in refractory processes involved in steel-making and other industrial applications.

The Dixon family mining operations and other holdings, including the Cavalier Hotel in Virginia Beach and thousands of acres of old-growth woodlands in central Virginia, have been controlled since 1974 by Gene B. Dixon Jr., 69, who assumed that role upon the death of his father in 1974.

Legal actions have been ongoing for several years and generally have pitted Dixon Jr., his son and other company officials against three minority shareholders: the husband of Gene Dixon's deceased sister and her two children, Curtis Dixon Colgate and Sharon M. Newcomb.

Kyanite Mining Corp. is one of rural Buckingham's largest employers but is virtually unknown of outside its tight circle of business interests. More evident to the general public are the hundreds of acres of mined moutaintop land visible along U.S. 15 south of Dillwyn.

Wolf said during the summer trial that there likely would be little change in day-to-day operations at the mining company if the minority stockholders were successful in their case. The valuable property could be taken under control by new owners or continue under the Dixon family under a new business plan determined by the court and receiver or mutual agreement of the parties.

(This has been a breaking news update. Check back for more details as they become available. Read more in tomorrow's Richmond Times-Dispatch.)

Thursday, May 3, 2012

Judge rejects entire defense after spoliation

Virginia Lawyers Weekly published this article today . Goes to show that honesty and integrity an inttegral part off our justice system.

In this lawsuit involving Safeway, Inc., (Garlick v. Safeway, Inc.), and the Virginia Supreme Court ruled that these cases should be heard by a jury rather than decided by a trial judge. Safeway had originally been successful in getting the slip and fall lawsuit dismissed on the grounds that the plaintiff’s case lacked evidence. The Supreme Court reversed the circuit court citing that they erred in granting Safeway’s motion that the plaintiff did not have a “prima facie” case. Prima facie is a Latin term, which refers to the evidence sufficient to prove a case

Judges can come down hard on litigants who hide or destroy evidence, but they rarely go so far as to block a defendant’s entire liability defense. Yet that’s what a Fairfax County judge did in a supermarket slip-and-fall case last year.

Circuit Judge Robert J. Smith lowered the boom on Safeway Inc., after finding the company had submitted an affidavit which – incorrectly – stated that vital evidence had been destroyed in conjunction with a store remodeling project. A company official later acknowledged the statement was false, according to Fairfax attorney Lawson D. Spivey III, who represented accident victim Cynthia Garlick.

In a trial that focused on damages only, a jury awarded Garlick $120,000 last year. The case is Garlick v. Safeway Inc.

Even after acknowledging the disingenuous affidavit, the company still never produced the information sought. The missing evidence included an employee’s statement about the accident, the name of the employee and video of the accident, Spivey said.

Spivey said his injured client did her own investigative work to locate the store employee. After five years of litigation, including three visits to the Supreme Court of Virginia, Garlick is hoping to see Safeway’s check for nearly $130,000, representing the verdict plus interest.

Garlick was shopping at a Safeway in Burke when she slipped in water on the floor and fell, breaking her arm. She had seen an employee in the area, stocking a shelf with cheese. The employee moved off and she approached the area, then slipped. She testified in an initial trial that she found herself in a puddle of water that covered an area of two-and-a-half to three feet of the floor.

Another employee testified he had seen water dripping from similar food carts, according to a 2009 Supreme Court opinion in the case.

Smith rejected Garlick’s case in the first trial. He struck her evidence, finding she had failed to show that Safeway could have known about the hazard.

The Supreme Court reversed in an unpublished order, sending the case back to Smith for another trial. With evidence showing an employee working in the area of the hazard, the court ruled, a jury could conclude that the employee should have either cleaned up the water or warned customers.

On remand to the Fairfax court, Smith gave the green light for Spivey and his team to explore Safeway’s missing evidence. “We kept getting the runaround,” Spivey complained.

Garlick’s lawyers demanded a deposition of a corporate representative with knowledge of the store’s practices regarding accidents. The designee revealed the missing information was not destroyed as part of any store remodeling. Nonetheless, the information still was not available.

Spivey said Garlick spent thousands of dollars on investigative work, in the absence of discovery documents from Safeway. “They really put it to her,” Spivey said.

Garlick managed to locate the Safeway employee involved. “It was just a stroke of luck that we found that employee,” Spivey said.

Smith’s decision to strike Safeway’s liability defense came at a hearing, Spivey said. “This has been a lesson in discovery abuse,” he reportedly said.

Safeway counsel Paul L. Warren of Norfolk did not return a call for comment.

Thursday, September 1, 2011

Service Is Job #1 in Litigation Support

CASE STUDIES: HOLIDAY WEEKEND MAILER

Bankruptcy mailer totaling 2.1 million pages needs to be completed in less than 72 hours…

“Call Superior!

They can do it".....Oh YES WE CAN

Issue

Bankruptcy mailer for former Fortune 500 totaling 2.1 million pages need to be completed in less than 72 hours with no prior notice over Thanksgiving weekend.

Background

Superior is contacted by a law firm’s bankruptcy team at approximately 2 p.m. on the Wednesday before Thanksgiving day. Parameters included copying 525 pages 4,000 times; collating and clipping the 3 separate sections; stuffing the mailer into tyvek envelopes; affixing postage and delivery to post office before midnight Saturday. Scanning, OCR, burning to 600 CD's, labeling, QC'ing and Posting them was a secondary assignment.

Challenges

Finding 4,000 tyvek envelopes with 2 hours left before a holiday weekend.
Coordinating delivery of 1.5 million sheets of paper; 1000 additional paper boxes and 40,000+ clips with 3 hours to go before close of business on Wednesday of a holiday weekend
Coordinating employees’ schedules to ensure round the clock over the Thanksgiving holiday in production, quality control; packaging and delivery.

Solution

Utilizing Superior’s network of suppliers, we were able to arrange delivery of all job materials before the close of business. The Superior Document Services team pulled together and worked for more than 72 straight hours through the holiday weekend to complete the project on time and accurately.

Sedona Principles 2nd ed.

1. Electronically stored information is potentially discoverable under Fed. R. Civ. P. 34 or its state equivalents. Organizations must properly preserve electronically stored information that can reasonably be anticipated to be relevant to litigation.
2. When balancing the cost, burden, and need for electronically stored information, courts and parties should apply the proportionality standard embodied in Fed. R. Civ. P. 26(b)(2)(C) and its state equivalents, which require consideration of the technological feasibility and realistic costs of preserving, retrieving, reviewing, and producing electronically stored information, as well as the nature of the litigation and the amount in controversy.
3. Parties should confer early in discovery regarding the preservation and production of electronically stored information when these matters are at issue in the litigation and seek to agree on the scope of each party’s rights and responsibilities.
4. Discovery requests for electronically stored information should be as clear as possible, while responses and objections to discovery should disclose the scope and limits of the production.
5. The obligation to preserve electronically stored information requires reasonable and good faith efforts to retain information that may be relevant to pending or threatened litigation. However, it is unreasonable to expect parties to take every conceivable step to preserve all potentially relevant electronically stored information.
6. Responding parties are best situated to evaluate the procedures, methodologies, and technologies appropriate for preserving and producing their own electronically stored information.
7. The requesting party has the burden on a motion to compel to show that the responding party’s steps to preserve and produce relevant electronically stored information were inadequate.
8. The primary source of electronically stored information for production should be active data and information. Resort to disaster recovery backup tapes and other sources of electronically stored information that are not reasonably accessible requires the requesting party to demonstrate need and relevance that outweigh the costs and burdens of retrieving and processing the electronically stored information from such sources, including the disruption of business and information management activities.
9. Absent a showing of special need and relevance, a responding party should not be required to preserve, review, or produce deleted, shadowed, fragmented, or residual electronically stored information.
10. A responding party should follow reasonable procedures to protect privileges and objections in connection with the production of electronically stored information.
11. A responding party may satisfy its good faith obligation to preserve and produce relevant electronically stored information by using electronic tools and processes, such as data sampling, searching, or the use of selection criteria, to identify data reasonably likely to contain relevant information.
12. Absent party agreement or court order specifying the form or forms of production, production should be made in the form or forms in which the information is ordinarily maintained or in a reasonably usable form, taking into account the need to produce reasonably accessible metadata that will enable the receiving party to have the same ability to access, search, and display the information as the producing party where appropriate or necessary in light of the nature of the information and the needs of the case.
13. Absent a specific objection, party agreement or court order, the reasonable costs of retrieving and reviewing electronically stored information should be borne by the responding party, unless the information sought is not reasonably available to the responding party in the ordinary course of business. If the information sought is not reasonably available to the responding party in the ordinary course of business, then, absent special circumstances, the costs of retrieving and reviewing such electronic information may be shared by or shifted to the requesting party.
14. Sanctions, including spoliation ﬁndings, should be considered by the court only if it finds that there was a clear duty to preserve, a culpable failure to preserve and produce relevant electronically stored information, and a reasonable probability that the loss of the evidence has materially prejudiced the adverse party.
Copyright © 2007 The Sedona Conference®. All Rights Reserved.
Reprinted courtesy of The Sedona Conference®.
Go to http://www.thesedonaconference.org/ to download a free copy of the complete document for your personal use only.

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