Search Tips

Bismarck Financial Group, et al. v. Caldwell

Docket No. 20200005
Oral Argument: Monday, June 29, 2020 9:30 AM

Docket Info

Title
Bismarck Financial Group, LLC; Gary Berube,
in his capacity as a Member of Bismarck
Financial Group, LLC; Doug Buehler, in his
capacity as a Member of Bismarck Financial
Group, LLC; Bob Johnson, in his capacity
as a Member of Bismarck Financial Group,
LLC; Matt Puetz, in his capacity as a
Member of Bismarck Financial Group, LLC;
and Larry Souther, in his capacity as a
member of Bismarck Financial Group, LLC, Plaintiffs and Appellants
v.
James "Jay" Caldwell, Defendant and Appellee
Case Type
CIVIL APPEAL : CONTRACTS
Appeal From
Case No. 2019-CV-01793
South Central Judicial District, Burleigh County
David E. Reich
Oral Argument 6/29/2020

Parties' Statement of Issues

  • Appellant

    1. Whether the district court erred in dismissing Bismarck Financial Group, LLC’s and its members’ claims against Caldwell for wrongful dissociation under N.D.C.C. s. 10-32.1-47.

    2. Whether the district court erred in dismissing Bismarck Financial Group, LLC’s and its members’ claims against Caldwell for breach of statutory duties under N.D.C.C. § 10-32.1-41.

  • Appellee 1

    1. Pursuant to N.D.C.C. § 10-32.1-47, a member of a limited liability company may dissociate at any time. If the dissociation is “wrongful,” the dissociating member may be liable for damages “caused by the dissociation.” Appellants alleged Appellee James “Jay” Caldwell wrongfully dissociated from Bismarck Financial Group, LLC (“Bismarck Financial”); however, Appellants did not allege to have suffered any damages caused by Caldwell’s dissociation. Did the district court err in dismissing Appellants’ wrongful-dissociation theory for lack of alleged damages?
    2. Under Section 3.08 of Bismarck Financial’s Operating Agreement, no member has an obligation “to make additional capital contributions . . . or to fund, advance, or loan monies which may be necessary” to pay company debts. Appellants contend they have been damaged because, due to Caldwell’s dissociation, individual Appellants each now contribute one-fifth of Bismarck Financial’s expenses, rather than one-sixth. Do Appellants have a claim against Caldwell to compel him to fund a portion of Bismarck Financial’s future expenses?


Summary

Bismarck Financial Group, LLC, et al. (“Bismarck Financial”) appeal from an order dismissing their claims against James Caldwell.

Bismarck Financial filed a complaint against Caldwell alleging he wrongfully dissociated from the company and is liable for his share of debt obligations, overhead, and expenses. Caldwell moved to dismiss asserting the complaint failed to state a claim for which relief could be granted. The district court granted Caldwell’s motion concluding Caldwell could not be held personally liable for the company’s expenses and obligations and Bismarck Financial’s claims were barred by the statute of frauds.

On appeal, Bismarck Financial argues the district court erred when it dismissed the case because Caldwell’s wrongful dissociation resulted in damages in the form of increased expenditure allocations to its members. Bismarck Financial asserts its claims are based upon statutory duties and therefore the statute of frauds is inapplicable.


Briefs

Filing Date Description
04/13/2020 APPELLANT BRIEF View
05/13/2020 APPELLEE BRIEF View
05/27/2020 REPLY BRIEF View

Counsel

Party Type Name
APPELLANT PRIVATE PRACTICE Bradley Neuman Wiederholt - 06354
APPELLANT PRIVATE PRACTICE Shawn Arlin Grinolds - 05407
APPELLEE PRIVATE PRACTICE Philip John Kaplan - 07952
APPELLANT PRIVATE PRACTICE Randall Joseph Bakke - 03898
APPELLEE PRIVATE PRACTICE Not Licensed in ND - 00002

(Note: Attachments may not be available for recently filed cases and/or confidential documents.)

Seq. # Filing Date Description Attachment
1 01/08/2020 NOTICE OF APPEAL : 01/08/2020
2 01/08/2020 ORDER FOR TRANSCRIPT : 01/13/2020
3 01/10/2020 Received $125 filing fee
4 01/13/2020 NOT. OF FILING NOT. OF APPEAL AND PROOF OF SERV.
5 01/13/2020 Notice served on Randall J. Bakke, Shawn A. Grinolds, Bradley N. Wiederholt, Grant T. Bakke,
6 01/13/2020 Philip J. Kaplan, & Cory D. Olson
7 01/17/2020 Rec'd Affidavit of Cory D. Olson in Support of Admissions to practice Pro Hac Vice
8 01/22/2020 MOTION FOR LEAVE TO APPEAR UNACCOMPANIED BY NORTH DAKOTA COUNSEL
9 01/24/2020 ACTION BY ACTING CHIEF JUSTICE VANDEWALLE - Granted
10 02/05/2020 ELEC. RECORD ON APPEAL DATED FEBRUARY 4, 2020 (ENTRY NOS.1-47)
11 03/06/2020 ELECTRONIC TRANSCRIPT DATED SEPTEMBER 17, 2019
12 03/06/2020 Certificate of Service for Transcript
13 04/13/2020 APPELLANT BRIEF View
14 04/13/2020 Oral Argument Request by Appellant
15 04/13/2020 APPELLANT APPENDIX
16 04/16/2020 Rec'd 5 copies of ATB and ATA back from Central Duplicating
17 04/17/2020 Rec'd $5.50 for 11 pages over 100 in Appendix (receipt #27569)
18 05/13/2020 APPELLEE BRIEF View
19 05/18/2020 Rec'd 5 copies of AEB from CSD
20 05/21/2020 NOTICE OF ORAL ARGUMENT SENT
21 05/26/2020 Non-Compliant RYB rec'd; given until 5/28/20 to revise (length)
22 05/27/2020 REPLY BRIEF View
23 05/29/2020 NOTICE OF RESCHEDULED ORAL ARGUMENT SENT
24 05/28/2020 Rec'd 5 copies of RYB from CSD
25 06/29/2020 APPEARANCES: Randall J. Bakke; Cory D. Olson
26 06/29/2020 ARGUED: Randall J. Bakke; Cory D. Olson
27 06/29/2020 ORAL ARGUMENT WEBCAST