Justia Utah Supreme Court Opinion Summaries

This appeal centered a film created by SummitWorks and Supernova Media. SummitWorks and Supernova formed LLCs in several states. Supernova and SummitWorks later litigated the issue of who had the right to control the LLCs. The law firm PADRM served as counsel for the LLCs. After PADRM stopped receiving legal fees it tried to foreclose on two liens on the film. PADRM sued SummitWorks and the LLCs (the first case) seeking a declaration the liens were valid. In response, SummitWorks filed a separate action (the second case) against PADRM seeking a declaration that the liens were invalid and a preliminary injunction against the sale of the firm. Supernova moved to intervene in both cases. In the second case, SummitWorks and PADRM were granted a motion to close the preliminary injunction hearing and to seal the related records. Supernova filed a motion to unseal the record. PADRM and SummitWorks subsequently signed a settlement agreement, and the district court dismissed both cases. The court also denied Supernova's motions. The Supreme Court reversed the denial of the motions to intervene and set aside the sealing order, holding (1) Supernova had a right to intervene in this litigation; and (2) the public had a right to access the court records related to the preliminary injunction hearing until they were properly sealed. View "Supernova Media, Inc. v. Pia Anderson Dorius Reynard & Moss, LLC" on Justia Law

This appeal arose from a disgorgement order issued by the district court requiring Attorney to disgorge $30,000 in legal fees he received for his representation of the Utah Down Syndrome Association and its founders and the Utah Down Syndrome Foundation. The order stemmed from a dispute between the founders of the Association and the Foundation. In the second of two lawsuits, the Foundation sued the Association and its founders. After discovering that some of the funds taken from the Foundation's disputed accounts were used to pay Attorney for his representation of the Association and its founders, the Foundation filed successive motions for disgorgement. The motion was granted. Attorney filed a motion to vacate the disgorgement order, which the district court dismissed. The Supreme Court dismissed Attorney's appeal for lack of appellate jurisdiction because, as a nonparty to this lawsuit, Attorney was not entitled to an appeal as of right. View "Utah Down Syndrome Found., Inc. v. Utah Down Syndrome Ass'n" on Justia Law

Appellant brought suit against his former employer, EnvironMax, and its directors to recover the value of shares he received to offset wages owed to him by the company - shares he claimed were diluted by corporate misdeeds. The district court dismissed Appellant's suit on summary judgment, concluding that the claim was derivative in nature and that Appellant lacked standing to assert it directly. In so ruling, the court concluded that EnvironMax was not a closely held corporation subject to an exception to the general rule requiring shareholder suits to be filed derivatively and that Appellant's direct claims were otherwise foreclosed by his failure to utilize the Utah dissenters' rights statute. The Supreme Court reversed, holding (1) because Appellant's alleged injury was an individual and not a collective one in common with all shareholders, Appellant was entitled to sue individually and not required to pursue his claim derivatively; and (2) the dissenters' rights statute does not preempt direct actions rooted in breach of fiduciary duty, such as the one brought by Appellant. View "Torian v. Craig" on Justia Law

After Michael G. Kampros's death, Mark Green and Sophie Gibson became trustees of the Michael G. Kampros Family Trust. Willow Rapela, Kampros's daughter and the successor trustee, requested removal of Green and Gibson pursuant to section 75-7-706(2)(d) of the Utah Trust Code. The district court granted her request with respect to Gibson but declined to remove Green. The district court held that Green had more experience and better qualifications than Rapela to manage the Trust's assets. As a result the district court concluded that Green's removal would not serve the best interests of the Trust's beneficiaries. The Supreme Court affirmed, holding (1) the district court properly concluded that removal of Green did not serve the beneficiaries' best interests; (2) the district court correctly held that Green's personal interests the LLCs in which the Trust also owned interests did not constitute an impermissible conflict of interest because Kampros knew about Green's interests at the time he appointed Green trustee; and (3) the district court permissibly compared Green's and Rapela's experience and qualifications when evaluating whether removal would serve the beneficiaries' best interests. View "Rapela v. Green" on Justia Law

Shawn Adel, a former employee of Westgate Resorts, a timeshare company, formed Consumer Protection Group (CPG) to right perceived wrongs stemming from Westgate's offer of certificates to consumers that were virtually irredemable. CPG solicited people who had received certificates to assign their claims to CPG. Westgate sued Adel, claiming intentional interference with existing and potential economic relations, conversion, breach of contract, and violation of the Utah Uniform Trade Secrets Act. Adel and CPG counterclaimed on behalf of 500 claimants, alleging breach of contract, fraudulent inducement, and violation of the Utah Consumer Protection Act. The jury awarded actual economic damages of between $5 and $550 for each claimant and awarded each claimant punitive damages of $66,666. The Supreme Court vacated the jury's punitive damages award, holding that the award violated Westgate's procedural due process rights under Philip Morris USA v. Williams because the statements made by CPG's counsel during closing argument created a risk that the jury would improperly consider harm allegedly caused by Westgate to nonparties when it fixed its punitive damages award. Remanded for a new evaluation of the punitive damages award only. View "WestGate Resorts, Ltd. v. Adel" on Justia Law

Petitioner Jones & Trevor Marketing appealed the dismissal of its suit against the owners of Financial Development Services, Jonathan Lowry and Nathan Kinsella, alleging various contract and tort claims based on an alter ego theory of liability. The district court held that Petitioner had not demonstrated sufficient facts to support its alter ego theory and therefore granted summary judgment against Petitioner on its tort and contract claims that rested on its alter ego theory. The court of appeals affirmed. The Supreme Court affirmed, holding that Petitioner failed to provide affirmative evidence establishing a genuine material dispute on its alter ego theory. View "Jones & Trevor Mktg. v. Lowry" on Justia Law

One of Summit Water Distribution Company's (SWDC) minority shareholders, Bear Hollow Restoration, filed a complaint requesting a review and investigation of SWDC's exemption from public regulation under the now-repealed Utah Admin. R. 746-331-1. The Public Service Commission dismissed the complaint on the basis that SWDC was not a public utility, and therefore, the Commission did not have jurisdiction. The Supreme Court affirmed the Commission's dismissal, holding (1) the allegations in Bear Hollow's complaint were insufficient to establish that SWDC served the public generally or that the Commission had jurisdiction; (2) Bear Hollow was not prejudiced by repeal of Rule 746-331-1 because the rule applied only to internal agency decisions and the underlying substantive law remained in place; and (3) the Commission did not abuse its discretion when it refused Bear Hollow's amended complaint after the original complaint had been dismissed. View "Bear Hollow Restoration, LLC v. Utah Pub. Serv. Comm'n" on Justia Law

Husband and Wife divorced in 2005. During the pendency of the divorce proceedings, Wife brought a separate civil suit seeking various forms of equitable relief and monetary damages, which the district court granted. At issue in the civil suit was certain property on which the couple ran an equestrian business but which a Husband's corporation owned. Husband filed a timely notice of appeal, arguing, inter alia, that the district court erroneously found that an express oral agreement existed between Husband and Wife to purchase, hold, and develop the property, and the equestrian business therein, for their mutual enjoyment and benefit. The Supreme Court affirmed in part and reversed in part, holding (1) the district court did not err in imposing a constructive trust and declaring the property part of the marital estate; but (2) the district court erred in its determination that an enforceable agreement existed, as the purported agreement lacked sufficient specificity. Remanded. View "Goggin v. Goggin" on Justia Law

Defendant Money & More Inc. (M&M) allegedly maintained and operated a Ponzi scheme. Pursuant to a petition filed by the State, the district court issued a temporary restraining order freezing Defendants' assets and later entered a preliminary injunction. Several hundred individuals and dozens of corporations that made fraudulent investments formed Money & More Investors LLC (MMI) and assigned to it their rights, interests, and claims against Defendants, who included the individuals comprising M&M. After reaching a settlement agreement with Defendants, MMI filed a motion to intervene in the State's preservation action. The district court granted MMI both intervention as of right under Utah R. Civ. P. 24(a) and, in the alternative, permissive intervention under Utah R. Civ. P. 24(b). The Supreme Court affirmed the grant of intervention as of right, holding that MMI met all the elements of rule 24(a) where (1) MMI's motion to intervene was timely; (2) MMI had a direct interest relating to the property; (3) MMI sufficiently established that the original parties to the suit would inadequately represent MMI's interests; and (4) MMI would be bound by the judgment. View "State v. Bosh" on Justia Law

When it was sued by its former president and CEO, the Equine Assisted Growth and Learning Association (EAGALA) requested coverage for the costs of its defense from its insurance carrier, Carolina Casualty. Carolina Casualty denied coverage, contending that the complaint was brought "by, on behalf of, or in the right of" EAGALA, a type of claim excluded from coverage by the insurance policy. EAGALA sued Carolina Casualty to establish coverage for the costs of defending the suit. The district court granted Carolina Casualty's motion for judgment on the pleadings and dismissed EAGALA's complaint after determining that it was unnecessary and improper for the court to consider extrinsic evidence to discern whether Carolina Casualty had a duty to defend EAGALA. The court of appeals reversed, concluding that under the language of the insurance policy, extrinsic evidence was admissible to determined whether the complaint was actually filed by, on behalf of, or in the right of EAGALA. On review, the Supreme Court affirmed the court of appeals' decision, holding that the district court erred when it refused to consider extrinsic evidence as required by the terms of the insurance policy. View "Equine Assisted Growth & Learning Ass'n v. Carolina Casualty Ins. Co." on Justia Law