IN RE: ESTATE OF EDWARD STEPHEN McREDMOND - Articles

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Posted by: Tanja Trezise on Nov 17, 2014

Court: TN Court of Appeals

Attorneys 1:

Roger Alan Maness, Clarksville, Tennessee and Jere Robert Lee, Nashville, Tennessee, for the appellant, Louis A. McRedmond.

Attorneys 2:

Richard K. Smith and Matthew A. Moushon, Nashville, Tennessee, and John P. Branhan and C. David Briley, Nashville, Tennessee for the appellees, Estate of Edward Stephen McRedmond and Anita Sheridan and Linda Orsagh.

Judge(s): GIBSON

This appeal involves a longstanding dispute among ten siblings with respect to a family business. After years of litigation, the parties agreed to dissolve the corporation that operated the family business and sell its assets. A receiver was appointed and authorized to sell the assets. The three defendant-siblings in this case placed the highest bid for the assets, and the trial court approved the sale to those three siblings. Prior to the closing of the sale, the three siblings formed a new corporation and assigned their right to purchase the assets to the newly formed corporation. Accordingly, at closing, the receiver conveyed the assets directly to the new corporation. The new corporation began conducting business just as the family business had done in the past. One of the plaintiff siblings formed another corporation and went into direct competition with the corporation that purchased the assets of the family business. The three individual siblings filed a counterclaim against the competing sibling, alleging intentional interference with business relations, breach of fiduciary duty, and that they lost the benefit of their bargain. They also sought injunctive relief against the competing sibling. Neither of the newly formed corporations was made a party to the proceedings. Following a three-day bench trial, the trial court awarded compensatory damages to each of the three siblings and entered a permanent injunction against the competing sibling. The competing sibling appeals the trial court’s order on numerous grounds. For the following reasons, we reverse the trial court’s order, vacate the injunction, and dismiss the counterclaim.

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