PBM Capital Investments, LLC v. Lalonde

Filing 23

MEMORANDUM OPINION. Signed by District Judge Glen E. Conrad on 7/9/13. (hnw) [Transferred from Virginia Western on 7/10/2013.]

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CL ERK' OFFP U. . ST. S CE S DI COURT AT ROANOG A . FL IED T TH E UN ITED STA TES D I I COU RT N STR CT FO R TH E W ESTERN D I I OF V I N I STR CT RGI A CH ARLOTTESV I LLE DI I ON V SI g J 2SA 1 UL 3 J A . l ubt DtDuR , ) RK c BY: D p- . r Y $ PBM CA PI TAL I V ESTM EN TS,LLC, N Ci lAc i N o. 1 vi ton 3: 3CV 00008 Pl i if a ntf , M EM O R AND U M O PI IO N N M I A EL G .LA LON DE, CH By:Ho Gln E.Conr d n. e a Chi fU nied St t sD i t i tJ e t a e sr c udge Def nda . e nt PBM Ca tll sme s LLC (i 'fldt saci a i tMiha G. l pia nvet nt, t PBM' ie hi ton gans c el Laonde ) (1 l ' ,a s tngcli frfaud e i e nta s c ii fa PBM alge t t i onde' seri ams o r ulnt nduc me nd e urtes rud. La ) le s ha La onde m a f s r pr e a i nsa l de al e e es nt to bouta m e c de c t the cl i e t ha c e t d t t e t di al vi e ha a m d o ve r a e o r a se p a a whih c us d PBM t i s ove $3, 000. i oa lm ied la lt c l e pne , c a e o nve t r 000, 00 nt i t ibiiy ompa ny (i 't ti fr dwihLaonde. Reyi o pr sonsi t LLC Ag e me ,Lal has û LLC' ha t ome t l ) l ng n ovii n he r e nt onde move t dimist c d o s s he ompl ntf i pr perve a f f iur t sae ac am or i t ai or m o nue nd or a l e o t t l i , n he a t r tve, o t a f rven t t U nie St t D it i tCo tf t D i ti tofD e awa e For le na i t r ns e ue o he t d a es s rc ur or he sr c l r. t r as ns t f l t co twilgr ntt m oton t tans e ve he e o hat olow, he ur l a he i o r f r nue. The m o i n t d s i s to o im s f ri pr rve wilbe de e asm oot a t c tw il e r i f om r i on t m oto t o m ope nue l ni d , nd he our l r f a n r ulng he in o dim i f faiur t s at a cl m . s ss or l e o t e ai Backeround PBM i aD el w a e LLC bas d i Cha l t vil ,V ig ni The com pa w a f s a r e n rotes le r i a. ny s onne f r d o t pur e ofa quii s c ii s a i tng i i he pos c rng e urte nd nves i n nnova i t c tve e hnol e . PBM ' f under ogi s So , pr i nt a c efe cutve ofi e i Pa M a ng. es de , nd hi xe i tc r s ul nni I Sept berof2010,Lal n em onde,ar dentofGeor a,ûs i t M anni s i t entf esi gi solcied ng' nves m or t pur he pose ofcom m er alzi Lal ci i ng onde' pr ot ofw hathe cl m ed w ast s ales , f l s ot ype ai he m l t uly f to lando rtonal( ii ar yprsur (1 '1me c lde ce'orte tng uncina, peai postve iwa e s e $PAP' dia vi 'f r ai ) i vi l wih o tuci se pa . ( ndi duas t bsr tve le pnea Compl! 1 ) Baedo Laonde' rprs ntto . 2. s n l s e e e ains r ga di t spur t br a hr h i see a a t c e r ng hi pored e kt oug n l p pne e hnol ogy,PBM a ee t bec e a gr d o om me rofDehu M e ca, mbe s m di lLLC,fkaZe La ,LLC to es l. PBM e erdi oa ll phyr bs l hum' nt e nt n LLC Agee ntf t opeai ofDehum (he' Agre nf'a uli tl i se ove r me or he rton s t I LLC e me ) nd tmaey nvetd r $3, 000. i o t c me cilz ton ofLa o ' see a a s tm . 000, 00 nt he om r a ia i l nde s l p pne yse l t i t ntac i PBM a l ge t ta t ren e i i t t LLC A gr e e a m a ng n he ns a ton, le s ha fe t rng n o he e m nt nd ki isi s m e ,PBM di c t nve t nt s over d t tLa onde' r pr s n a i r r ng t pe f e ha l s e e e t tons ega di he r onna e and nc f tona iy oft s e p a a s t m w e e f l e PBM f t ra l gest tt unc i lt he l e pne ys e r as . urhe le ha he m i r pr e a i w e e kno i y a i e i naly m adeby La onde, nd t tPBM r le upon s e es nt tons r w ngl nd nt nto l l a ha e id t m i r pr e a i nsi f r i D e hum ,pur ha i D e hum s lrte ,a i s i m ilons he s e es nt to n o m ng s c s ng s ecz ii s nd nve tng li ofdola si o t s e p a l r nt he l e pnea s t m . PBM a s t c a m s f r c m o 1 w f a e ys e s ers l i o om n a r udul nt i e e a s a ut r s urte f a ndue m nt nd t t o y ec ii s r ud. La onde hasm oved t di m i s t co pl i tor i t a t m a i ,t t a f rve t t l o s s he m a n , n he le tve o r ns e nue o he Unie St t s D i ti tCour f t D i ti tofD e a r . Them oton i pr m i e on c r a n t d a e s rc t or he sr c l wa e i s e sd e ti pr sonsoft LLC Agr eme ,whi h wass ovii he e nt c ubmil d asa e bi t Lal te n xhi t o onde' moton. s i Sec i n 1 03 oft LLC A gr e e co a nsbo h a c c of1 w c a e a a f m t o 4. he e m nt nt i t hoi e a l us nd onz s l ton cl e. The s ton pr de ,i pe tne pa t a f l s e ec i aus ec i ovi s n r i nt r , s olow : G o r nc Law sSubm i s on t J r s i to .W a ve s Thi A gr e e a t ve ni ' s i o u i d c i n' i r . s e m nt nd he rght oft pa te he e i s he ri s r unde s l be i e pr t i a co da e wih t l w s of r ha l nt r e ed n c r nc t he a t St t ofD e a a e, ihoutgi ng e f c t a c lc of1 w pr nc pl s Ea h he a e lw r w t vi f e t o ny onfi t a i i e . c oft M e r a e t i a diput i no r ol by t pa te ,i s lbe he mbe s gr es hat f ny s e s t es ved he ris t hal r ol d onl i t f der lors a e c ' oft St e ofD e a a e s ti i N e es ve y n he e a t t oul s he at t l w r itng n w CateCount a t a laec ursha ngj iditonofappe si s hc t sl y nd he ppelt o t vi urs ci al n uc ours (ole tvel t t o rCours'. l t tco e ,a wihoutlmii t c lci y,he t pe pr t' n ha ntxt nd t l i tng he ge r lt oft f e ng,e h oft M e be sir ne a iy he or goi ac he m r r evoc bl a unc tonaly a y nd ondii l ()s t f is fa ispr ryi a a tonrltngt t doc nt a ubmis or tel nd t ope t n ny ci eai o he ume delve edpurua t t sAgr e e orf r cog ton a e or eme ofa i r s nt o hi e m nt or e nii nd nf c nt ny j g n i rs c hee f t t ee cu iej rs ito o ud me t n epe t ro ,o h x lsv u idcin f t Pr pe Co t a a e t ta1 c a m si r pe tofa s h ac i n s lbe he o r urs nd gr es ha 1 l i n es c ny uc to hal hea d a de e m i d i s h c ti t St t ofDe a a e t t e ent nnit r nd t r ne n uc our n he a e l w r , o he xt pe ted byl i s hf erlco t gnd)( c e st ta s hacinma a s l aw,n uc ed a ur;a b) ons nt ha ny uc to y nd hal bebr oughti s hc t a wave anyo j ci t tima now o t r fe n uc ours nd i s b e ton ha t y r heeatr ha t t v orj iditonofa s h a toni a s hc 'o t ts h ve o he enue urs ci ny uc ci n ny uc oul r ha uc t ac i n w asbr to oughti a i nve e c r a ag ee nott pl d orc a m t n n nco ni nt ou t nd r s o ea l i he Sarne .... ( Agr me j1 03. LLC ee nt 4. ) The LLC A gr e e a s c ai a m e ge cl us a a no r i e cl us Se ton e m nt l o ont ns r r a e nd n-elanc a e. c i 1 06pr dest tdgl sAg e me ,ogehe wihalExhi t heeo,a a ResrcedUni 4. ovi ha ithi r e ntt t r t l bis rt nd ny tit t A g e m e s c a nst e i e unde s a ng a ong t pa tesa s pe s desa pr o a r e nt , ont i he ntr r t ndi m he r i nd u r e ny i r nd c n e o a e usu d rtn i sa da r e n sb t e t e rs e tn tes b e t te o tmp rn o n e sa dng n g e me t ewe n h m e p cig h u j c matr hee ' (d.j1 06. Se ton 1 02( pr dest te chme rr e e sa warnt t t rof' l 4. ) ci 3. 9 ovi ha a mbe eprs nt nd ra s ha d tha r le onl o t i o m a i n s tf r h he e n i de e m i ng t a qui e Unis....' i s e i d y n he nf r to e o t r i n t r ni o c r i t ' (d.j1 02( ) TheAgre ntdefne d t' ûa ownerhi i e eti t Compa l 3. 9, e me i s t 'as dn uni s p ntr s n he ny, i udi a 1oft r ght a oblga i i c ncl ng 1 he i s nd i tons n onne ton t r w ih unde t sAgr em e . .. (4 c i he e t r hi e nt . ' 1. ' j 101) . . Bas o t f egoi s ci nsoft LLC Ag e m e t Lal ed n he or ng e to he r e n , ondea g st tve uei t s r ue ha n n hi dit i i i pr s rd s m opera t tt eo pl i tf ist s a e a d a m upon whi h r lefo n be g a e nd ha he m a n a l o t t i c ei a r nt d. Thecou t l ahea i on Lal r he d rng onde' m otonsc M a 2, 3. The m a t rha be f l br e e s i m y 201 te s en uly i f d and i ri f r ew . s pe or evi pic so s us i n The t z hol i s r i e by Lal h es d s ue a s d onde i w h he t W eser D it i tofVi gi a i a s et r he t n s rc r ni s pr opervenue f t s acton. Rel ng on t f um sel i cl or hi i yi he or ecton ause cont ned i t LLC ai n he Agr ent Lal eem , onde arguest t cas s d be di m i ed ort fer t t D it i of hat he e houl s ss rans red o he s rct 3 Dea r PBM oppos st m o i a gui t iscli sf l outi t s ope oft f um lwa e. e he ton, r ng hat t am al sde he c he or sel i cl e. ecton aus The e or ea lt ofa f r m s e ton c a e i f de alc ti a m a t rgove ne by nf c biiy o u el c i l us n e r our s te r d fde a lw. Stwa tOr ,nc v.RiohCom.487U. 22,32( 988 ;Al ma l Cor v. e rla e r g.l . c , S. 1 ) be re p. Asrze c UK Lt ,6 F. 643,650(t Ci. 0) Unde fdea lw,af m s lci ta ne a d. 28 3d 4h r 201 . r e rl a onz ee ton cl us i t i a f i va i a s d be e or ed unl s e or m e i s w n by t r s s i a e s t m ac e ld nd houl pr nf c e s nf ce nt s ho he e itng pa t t be û ea o bl unde t cic sa ry o unr s na e' r he r um t nces' The Br l n v.Za a Of - r Co. 407 .' ehe pat f sho e , U. 1,9(972) A f um s l tonclus ma bec i rdunr s na ei: S. 1 . or eeci a e y onsdee ea o bl f ( )kt)f mai wasi 1 is or ton nduce byfa o overac ng;( t c ai ngpa t d rud r re hi 2) he ompl ni ry d ilf a 1 a tc pur e be de i d ofhi d y i c t bec us oft g a t l or 1 pr c i al pos s w pr ve s a n our ' a e he r ve ' i on ninc orunf r s oft s e tdf um;()t f me alt ar s nc ve e e aine s he elce or 3 he unda nt mfines oft chos nlw mayde i t plitf ofar dy; ( (tle oreme he e a prve he anif eme or 4) is nf c nt w oul cont avene a s r publc polcy oft f um s at d r t ong i i he or t e. Ale v.Ll sofLondon,94F. 9 9 ( h Ci.1 )( i TheBrme 408U. at ln oyd' 3d 23, 28 4t r 996 quotng e n, S. 1 . 8) l t sca e,PBM doesnotco e t tt a f r i t c e t Del w a e woul n hi s nt nd ha r ns e rng he as o a r d c r ne publc polc o d prve t c pa ofis d y i c t an a opra e r m e ontave i i y, r e i he om ny t a n our or ppr i t e dy. Li w i e, he e i no a l ga i off a i t i e e oft f r m s l to c a e is l . ke s t r s le ton r ud n he nduc m nt he o u e ec i n l us t e f W hie PBM cl i st tt LLC A g e m e a a whol wast pr l a m ha he r e nt s e he oduc of La onde' f s t l s al e r pr s nt tons ge r lcl m s offa s h a t e co a ned i t c pl i ,t nots fc e e e a i , ne a ai r ud, uc s hos nt i n he om a nt û do uf i e t i ldaeavai fr s e tonca e. W oncv. ryGa ngLt ,589F. 821 828( h o nvai t ld oum elci lus ' ' Pat mi d. 3d , 6t Ci.2009 ;s eas Sc k v. bet cul rCo.41 U. 5 51 n.4( 974)( fa r ) e lo hgr Al ro- ve , 7 S. 06, 9 1 1 The r ud e e i i The Br m e ç s notm e t ta tm e a di put a i i outofa ta a ton i xc pton n e n t doe an ha ny i s e rs ng r ns c i s ba e upona alegain o fa ...heca ei unenf c abl Rahe ,ime nst tgj... sd n l to f rud t lus s ore e. t r t a ha a f r - el ton c a e i a c r c i une or e bl i t i l i o t tcl us i t co r c o um s ec i l us n ont a t s nf c a e f he nc uson f ha a e n he nt a t 4 wa tep o u to fa do c eco ' (mp a i i o ii a) l t ea e c o a y ohe s h r d c f ru r o rin.) e h ss n rgn l. n h bs n e f n t r ' a g e ast t valdiy oft f um s e ton c a e, he c tc l st tt c a e i r um nt o he i t he or el c i l us t our onc ude ha he l us s r s ea onabl a e or ea e e nd nf c bl . H a ng r c t s de s on,t cou tm us now de e m i whe he t c a e a i s t vi ea hed hi ci i he r t t r ne t r he l us pple o t c ai sas e td i t i t ntc s Se e :. Robi o v.La Fu niur LLC,995 F. he l m s re n he ns a a e. e, . , ns n dd r t e. 2d 1 1 U. App. 064, 993 S. LEXI 1 2, t*1 (t Ci.1 (iti note S 425 a 2 4h r 993) $1 s noughsmpl t de i t t i y o cde ha t scl us i e o c a e i t a t a t w e m us a s de e m i whe he i i e or ea e aga ns hi a e s nf r e bl n he bs r c ' , t l o t r ne t r t s nf c bl i t t epatc a cai .'. I ma ngt sd e nai t co tl ûot lng geoft hes riulr l ms' n ki hi etnui ton,he ur ooks s he a ua ) t he pa te c rcg)t deemi whihc us ofa tonaeg r dbyt fnz s lcton ris' onta t o tr ne c a es ci r ove ne he o m ee i ca eg15 M ai c nc Shipi Lt v.Se ta 1 F. 21 222( t Ci.1 . lgl lus . ' rne ha e p ng, d. basiq, 43 3d 6, 5h r 998) dlf t s t eofghepl ntf s cli ,srppe o t i lbes doesno f lwihi t sopeof he ubsanc t ai if ) ams ti d f her a l, t al t n he c t clus Jt ca e 1c he a eg ,he lus l annota y. Robyv. )p ofLl s 996F. 1 1 ( Ci, ppl ' ' C(r . oyd', 2d 353, 361 2d r 1 . 993) H er t pori oft LLC A gr enti diput pr desasf l s: e, he ton he eem n s e ovi olow Thi A gr e e a t r g soft pa te her unde s l be i e pr t d i s e m nt nd he i ht he ri s e r ha l nt r e e n a or nce w ih t l w s oft St t ofDel w a e w ihou gi ng ef e tt a cc da t he a he a e a z , t t vi f c o ny c l c s ofl w prnc pl s Eac oft M e be sa e st ti a di put i not onti t a i i e. h he m r gr e ha f ny s e s r s ve by t pa te ,i s l be r s ve onl i t f er lor s a e cou t oft e ol d he r i s t ha l e ol d y n he ed a tt r s he St t ofDel w a e sti i N e Casl Co t a t a la e c t ha ng ae a r itng n w te un y nd he ppe l t our s vi j rs ito o a pe l i s c c u t (o lciey teI o e Cou s'. u idcin f p as n u h o rs c le tv l ,h t p r t1 ' pr l ( Ag e men j1 03. Forhi pa tLao eague t tt f um slci ca ea is LLC r e t 4. ) s r, lnd r s ha he or ee ton lus pple br dl t a di put bet e n t pari . l r s ns ,PBM a guest tt cl us i lm ie by oa y o ny s e w e he tes n e po e r ha he a e s i t d t c c of1w pr so c ane i t frtlneofj1 03a t ,ha ii onl ti rd he hoie a oviin onti d n he is i 4. nd,hus t t t s y rggee when ac tmus i e r tt LLC Agr e e o t pa te 'rght t emde . our t nt p e he e m nt r he ris i s her l r U li a e y,t c tfndsi un c s r t r ol t s di p e. Eve as um i t t tm t l he our i t ne es a y o es ve hi s ut n s ng ha PBM ' na r r a ng oft f m s l to c a e i co r t t c tc l st tis c a m s S r ow e di he onz e ec i n l us s r ec , he our onc ude ha t l i off a r udul n i e t nduce en a s c ii f a f l w ihi t s ope oft e a e. m t nd e urtes r ud a l t n he c he l us By sg ng t LLC Agr e e ,PBM ex es l si aed t ti ha C e id onl on t i ni he e m nt pr sy tpult ha t d k le r y he i or to stf t (nt Ag e menl'n a quii a o rhi i ees i t LLC, ndt t nf main e orh i he r e t'i c rng n wne s p ntr t n he a ha t Agre ntc ai d khee ieunde sa nga he e me ont ne % ntr t rtndi mongt pate . ( Agre ntjj he ris' LLC e me ' 1 02()& 1 06 . Nowihsa ngt s pr viins PBM now cams i ea hofiscou s t t 3. i 4. ) t t tndi he e o so , li ,n c t nt,ha i r le on f l e r pr s nt t o ,whi h w e enotco a ned i t LLC A g e m e ,i m a ng is t ei d a s e e e a i ns c r nt i n he r e nt n ki t de i i n t e eri t t LLC A gr e e a pur ha e D e h s c ii s A se de e by t r c s o o nt n o he e m nt nd c s s um e urt e . vi nc d hei bre son t m oto t di m i sf f iu e t s a e a c a m , he pa te s p l di ag e ast if he i n o s s or a l r o t t l i t r i s ha y s r e o whe he t m e ge a non- ela pr vi i oft LLC A gr e e pr c ud PBM f om t r he r r nd r i nce o s ons he e m nt e l e r e t bls ng t e s ntale e e sofisf a cl i s Com pa e RA A M gm t.LLC v. vaz s a i hi he s e i l m nt t r ud a m . r . Sa e SporsHol ngs l ,45A.d 1 11 ( . 2)( di unde Dea r lw,ha a t di .nc. 3 07, 9 Del201 hol ng, r lwae a t t pli ifsfa camsweebardbyano rla edicame ca ei t pa te 'a r e nt, antf rud li r re n-einc sli r lus n he ris g e me ) wih FS Phot I v. pis e sonl , F. t o. n vs curvii nc.61 Supp. 473, ( D. 1 2d 48l E. Va. 999)( di t r hol ng,mde - Vigi alw,ha ac r t ldicli rofrla edi notpr l acam offa i seas r ni a t t ontacua s ame einc d ecude li rudl* e lo AESCor v.Dv uvPowe Cor ,325F. 1 4,1 ( Ci. 03 ( lni t hol t ta p. ne r p. 3d 7 81 3d r 20 ) deci ng o d ha non-e i nce cl us w ila w a pr vi i m uniy fom f de a s urte f a la lt but r la a e l l ys o de m t r e r l ec ii s r ud i biiy, e pha i i t tc s s i vi a no r la e cl us i a ne i e conta be wee m s z ng ha a e nvol ng n- e i nc a e n gotat d r ct t n s p itc tdp rist l o tnbea p o raec n i ae f rr s lto a t s mmayj dg n o h siae a t i l fe e wi p rp it a d d ts o e ou in the u r u me t sage). Eve i i i uli tl deemi dt tt s pr sonsdonotopeaet barPBM ' t ' n f t s tmaey tr ne ha he e ovii rt o S cl m s off audul i ai r ent nducem entand seclrtesf aud,t r uton oft zii r he esol i hese cl m sw il ai l *The pari alo diput t s tes s s e he cope oft LLC Agr m e ' choi ofl pr son and t efec t ti he ee nts ce aw ovii he f t ha t hason t mert oft pl ntf ' cl msunde sat Iw . he is he ai ifs ai rtea 6 ne s a iy i plc t t i e pr a in oft LLC Agr me a t pari s rg st r unde . ce s rl m i ae he ntr etto he ee nt nd he te ' iht he e r Cons que l t c tco l e nty, he our nc udest t e n t de t na r r a ng a nc by PBM ,t ha , ve m r he r ow e di dva ed he c a m sa i s f l w ihi t s ope oft f um s l c i cl us . See Soi Bl Sys v.CM l l i t s ue a l t n he c he or e e ton a e l dz. . Terex C orz No. 04- 0210, 4U. DitLEXI 1 p, 3: CV200 S. s. S 0663,a *1 ( D.Te J 9 2004) t 8 N. x. une , - ( di t tt pli ifscamsoffa a mirprs ntto we egovene byafr m hol ng ha he antf' li rud nd se e e ain r r d ou s l to c a e,snce s h cl i sr quie i e pr t ton oft pa a e e sofa a r e e ' e ec i n l us i uc a m e r d nt r e a i he r m t r n g e m nt s pr sondicli nga1orlrprs nttonsa prora e nt) ovii s ami l a e e e ai nd i greme s. Be aus t f um s l c i c a e r qui e ltga i i D e a a e,i f l st tve i c e he or e e ton l us e r s ii ton n l w r t olow ha nue s no pr ri t sditit Rahe t ndimisngt c eunde Rul 1 b)3)oft Fe rl t ope n hi src. t r ha s si he as r e 2( ( he dea Rue o Ci iPr c d r ,h c u' i t eitrs o j sie wi ta se t ec s t t Ditit f ls f vl o e u e t e o r,n h n eet f u tc , l r n fr h a e o he src o t l Delwae,whe ei c dha be nbr a r r t oul ve e oughti tal See28U. C.j1 a)Ct- ditit niily. S. 406( -he src l c tofa dit i ti w hi h i fl a c e l yi ve i t w r di s o ordi t i ts l our s rc n c s ied as a ng nue n he ong vi i n sr c ha l d s s, ri ibei t eitrs o j sie ta frs hc s t a yd src o dv so i wh c i imis o f t n h n eet f u tc ,rnse uc a e o n itit r iii n n ih t c dha bee brug .) oul ve n o ht' . ' Concl i us on Fort r ons s at t courtwilgr Lal he eas t ed, he l ant onde' m oton t t ansf t s acton t t s i o r er hi i o he D i t i tofDe a a e, nd de a m oothi m o i t di m i sf i pr pe ve sr c lw r a ny s s ton o s s or m o r nue. The c t our dec i st r e on La o ' m oto t dim i sf f iur t sa e a c a m and l a t tm o i t lne o ul l nde s i n o s s or a l e o t t l i e ves ha ton o be de i ed by t t a f r e c t cd he r ns e e our . The Cl r i di e t t s nd o r ii d c pi oft sm e or ndum opi on a t e k s r c ed o e e tfe o es hi m a ni nd he accom panyi ordert a1 couns ofrecor ng o 1 el d. ENTER: i Q Ths d yo J l, 01 . a f uy 2 3 / i M W . Chi Unied St esD i rctJudge ef t at sti