Bismarck Financial Group, et al. v. Caldwell
- 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
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
Parties' Statement of Issues
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.
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?
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.
|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|
|14||04/13/2020||Oral Argument Request by Appellant|
|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)|
|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)|
|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|