Curtis D. Smith, Attorney

Case Studies

Defense of $8.0 Million Claim for Theft of Trade Secrets; Employee Disloyalty; Breach of Non-solicitation Agreement; Aiding and Abetting

Our client, a very large truck parts supply company, hired the top two managers of plaintiff’s North Dakota branch, with employment to start after a new branch office was built out by client. After waiting in place for three and one-half months, the managers resigned without notice and immediately began recruiting plaintiff’s employees – and were successful in getting 55% of the work force to join our client. The managers and all employees were “at will,” but one of the managers had a non-solicitation agreement and the new employees brought customer lists with them. Plaintiff contended that the employee “lift out” irreparably destroyed their North Dakota business. After a three-week jury trial in North Dakota federal court, the jury returned a defense verdict on all counts.

Settling a Former Shareholder’s Claims

The majority owner of a successful company was sued by a former minority shareholder she had previously bought out.  The plaintiff alleged that his rights as a minority shareholder were violated before he sold his stock.  In a case of first impression, the plaintiff claimed that he had been illegally terminated from his employment and was entitled to lost salary.  He also claimed emotional distress damages for having been forced off the board of directors, and he argued that his stock sale did not preclude either claim.  

Our team of trial attorneys first persuaded the court to dismiss the employment claim, and then resolved the rest of the claim successfully.  Decisive developments in the case included locating the plaintiff’s pertinent medical records and forcing the production of his personal diary, which revealed multiple sources of distress beyond his employment termination.

Breach of Contract Trial

A major manufacturer of private label food products was sued by its former business partner for breaching their joint venture agreement.  The partner claimed that our client set too tight a specification for an ingredient supplied to the venture by the partner.  The partner’s damage claim exceeded $34 million.  

During the six-week trial, our team of trial attorneys convinced the court that the partner’s expert had made substantial errors and had limited the damages awarded to $275,000, less than had been offered in settlement and one percent of the amount claimed.  Our efficiency in handling large cases was further confirmed when the partner’s financial records disclosed that the plaintiff’s attorneys fees were approximately double the amount of our fees.

Upholding the Rights of an Insured

Our client suffered a substantial hail loss to its farm buildings, and its insurer offered to pay only a fraction of the replacement cost to repair the damage.  We guided our client through the appraisal process required by the insurance policy, but the insurer still refused to pay, claiming that the policy did not contain replacement cost coverage.  We commenced litigation and undertook discovery into the insurer’s adjustment practices.  The insurer settled by paying the full replacement cost, plus reimbursing our client for its attorney’s fees, employee time, interest, and appraisal costs.

Maximizing and Protecting Rights of Homeowner

Our client’s 15,000-square-foot lake home suffered major water intrusion and mold infestation.  Through a combination of claims against his homeowner’s insurer and the contractor who constructed the home, we recovered a total of $1.5 million.  The claim against the contractor, and his subcontractors, was tried to a jury, which resulted in a recovery 20 times the amount that had been offered in settlement prior to trial.

Making Right on a Fraudulent Deal

The sellers of several small telecommunications companies had suffered huge financial losses due to the fraudulent acts of the purchaser of their enterprises.  Ten individuals had sold their local telecommunications companies to a Fortune 500 company as part of an industry “roll-up.”  Half of the consideration received for the sale was stock in a subsidiary of the acquiring company.  Before the sellers could realize any value in this consideration, the acquirer filed for Chapter 11 bankruptcy and the stock became worthless. 

The case presented complex legal issues under both federal and state securities laws, including the application of the Sarbanes-Oxley Act of 2002 and the Private Securities Litigation Reform Act of 1995.  The case was settled with the defendants’ insurer, and the plaintiffs were awarded damages of $2 million, despite the effort of the purchaser to file for bankruptcy protection. 

Protecting a Client’s $10M Business Opportunity

Our client had negotiated a very favorable financing arrangement with a wholesaler of electronic goods.  Key to the transaction was credit insurance issued by an international insurer.  A few months into the arrangement, the credit insurer decided it wanted to withdraw from the deal in violation of its contract.  We sued the credit insurer and obtained a temporary restraining order, which prohibited the insurer from withdrawing from the transaction.  The case then quickly settled, which allowed our client to make in excess of $10 million over the life of the arrangement.

Dismissal of Claims on Jurisdiction Grounds

A Rhode Island business client and its principals were sued in federal court in Minnesota by a former long-term business consultant for breach of a consulting agreement. We obtained swift dismissal of all claims against our client based on lack of personal jurisdiction. We successfully convinced the court that exercising jurisdiction over our client in Minnesota violated the Minnesota long-arm statute and constitutional due process. 

Successful Resolution of Non-Compete/Non-Solicitation Dispute

Our client was a top executive of a national retail grocery, supply chain, and wholesale distribution company. After leaving the company to take a position at one of its largest competitors, our client and his new employer were sued in federal court for breach of a non-competition and non-solicitation agreement, misappropriation of trade secrets, and interference with contractual relations. After persuading the court to refrain from issuing a temporary restraining order against our client which would have prevented him from working for the competitor, we successfully settled the dispute, and our client now enjoys unencumbered employment with his new employer.