- Case Type:
- Business
- Case Status:
- Affirmed
- Citation:
- 20-2771 (8th Circuit, Jan 31,2022) Published
- Tag(s):
-
- Ruling:
- A defendant in a trial for conspiracy to breach fiduciary duty must specify the law and facts that would entitle the defendant to a judgment as a matter of law. The defendant and may not wait until after an adverse judgment is entered to specify such legal errors and factual omissions.
- Procedural context:
- Defendant/appellant was sued for conspiracy to breach fiduciary duties.
Before the verdict was entered at trial, appellant moved under Fed. R. Civ. P. 50(a) for judgment as a matter of law. After the verdict was entered against him, appellant again moved for judgment as a matter of law. In his post-verdict motion, appellant made arguments that he did not make in support of his Rule 50(a) motion, including:
-- there was no evidence of an unlawful act in furtherance of the conspiracy;
-- the Chapter 7 trustee failed to plead a conspiracy to breach fiduciary duty because there was not third-party to the 2014 Amendment;
-- plaintiff's theory of damages ignored the rights of a party to a contract with the debtor to terminate certain obligations to the debtor; and
-- the breach of fiduciary duty claims duplicated breach of contract claims.
The district court held that appellant's post-verdict motion for judgment as a matter of law failed to comply with Fed. R. Civ. P. 50(b) because the appellant's pre-verdict Rule 50(a) motion did not raise the arguments made in his Rule 50(b) motion.
- Facts:
- Xurex, Inc. held patents on and manufactured protective coatings. In 2010, Xurex and DuraSeal Pipe Coatings Company, LLC (DPCC) executed a license agreement that required DPCC to make minimum monthly purchases and pay royalties through 2018. Jose Di Mase owned and controlled DuraSeal Holdings, S.r.L. (Holdings, and together with DPCC, DuraSeal). Holdings acquired DPCC in 2011 and entered into a separate licensing agreement with Xurex. This deal was facilitated with appellant, Lee O. Krause, who was engaged as a consultant by Di Mase.
In early 2014, Xurex's CEO, Di Mase, and others began discussing bankruptcy with Krause. Krause drafted an amendment to the 2010 licensing agreement between Xurex and DPCC. This amendment gave manufacturing rights to DuraSeal, eliminated minimum purchase obligations, and allowed DuraSeal to keep its exclusive licenses. Krause signed the Amendment as DuraSeal's CEO.
Later in 2014, Xurex filed for bankruptcy. Xurex's Chapter 7 trustee sued Kraus and others for conduct leading up to the 2014 Amendment. Kraus was sued only for conspiracy to breach fiduciary duty.
Kraus represented himself at trial. Before the verdict was entered, Kraus moved for judgment as a matter of law. After losing at trial, Kraus again moved for judgment as a matter of law and, in the alternative, for a new trial.
- Judge(s):
- LOKEN, COLLOTON, and BENTON
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