Advice for business: Hire an attorney (Tennessean)

A small business just starting out needs a "strong three-legged stool to support it," columnist Jeff Cornwall writes. "The three legs should consist of a strong attorney, a CPA and a business banker." Cornwall explains why it's best not to do-it-yourself when it comes to these jobs.

Chris Sloan, an attorney with the Nashville office of Baker, Donelson, Bearman, Caldwell & Berkowitz, weighs in saying that the best way to avoid a nasty business breakup later is with an agreement that addresses issues like decision-making, dispute resolution, what happens if someone dies or wants to leave, and how and when to shut or sell the business. "With a good agreement, you accomplish two things," Sloan says. "First, you avoid a dispute down the road, and second, you have a chance to preserve the personal relationships."

Read the full story at the Tennessean's website: http://www.tennessean.com/article/20110509/BUSINESS/305090019/Startup-entrepreneurs-need-good-business-attorneys

Tennessee Adventure Tourism and Rural Development Act approved in Senate Finance Committee

The Senate Finance Committee has approved legislation to enact the Tennessee Adventure Tourism and Rural Development Act. The objective is to establish a plan for Tennessee to promote outdoor recreational opportunities in rural, high-employment areas of the state to create jobs. Senate Bill 1205 would direct the Department of Economic and Community Development and the Department of Conservation and Environment to perform a study and create a plan to promote adventure tourism and other recreational and economic development activities in rural areas.

Court Reviews Whether Plantiff's Case, Based on Respondeat Superior, is Barred

ANNE LAVOIE and JODEE LAVOIE v. FRANKLIN COUNTY PUBLISHING COMPANY, INC. (Tenn. Ct. App. May 18, 2011)

These consolidated actions are before this Court on a Tennessee Rule of Appellate Procedure 9 interlocutory appeal from the trial court's denial of summary judgment. We are asked to consider whether, as a matter of law, a plaintiff is barred from maintaining a suit against an employer under a sole theory of respondeat superior where the plaintiff settles her claim against the employee, executes a release of all claims as to the employee, but reserves her claim against the employer in a court order dismissing the employee with prejudice. We hold that the plaintiff's suit is barred. The judgment of the trial court is reversed, summary judgment is granted to the employer, and the case is dismissed.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2011/lavoiea_051811.pdf

Court Reviews Liability of a Bar's Insurer for the Death of a Bar Patron

DONNA CLARK v. SPUTNIKS, LLC ET AL. (Tenn. Ct. App. May 26, 2011)



The trial court determined that the insurer of a bar was liable under its commercial general liability policy and liquor liability policy for the death of a bar patron. We have concluded that this occurrence is excluded under the assault and battery exclusion of the commercial general liability policy but is covered by the liquor liability policy. 


Opinion available at:

http://www.tba2.org/tba_files/TCA/2011/clarkd_052611.pdf

Court Reviews Conflicting Transactions for the Assignment of Oil and Gas Leases

CNX GAS COMPANY, LLC v. MILLER PETROLEUM, INC., ET AL. (Tenn. Ct. App. May 11, 2011)

This appeal involves a business transaction for the assignment of oil and gas leases. The parties are sophisticated in the oil and gas industry and include CNX Gas Company, LLC ("CNX"), Miller Petroleum, Inc. ("Miller"), Atlas America, LLC ("Atlas"), and Wind City Oil & Gas, LLC ("Wind City").

CNX and Miller entered into a binding Letter of Intent ("LOI") for the assignment of oil and gas leases owned by Miller. Prior to signing the LOI, CNX knew that the leases were the subject of pending litigation between Miller and Wind City. The letter of intent outlined the details of the transaction and a closing date. On the closing date, Miller refused to close the transaction with CNX, claiming that it did not have possession of the leases. Approximately one week later, Miller entered into a similar deal for the assignment of those leases with Atlas. The transaction between Miller and Atlas was worth substantially more than the transaction with CNX.

Thereafter, CNX sued Miller for breach of contract; CNX also sued Atlas and Wind City for inducement to breach a contract. Miller and Atlas filed motions for summary judgment following discovery that involved depositions. After a hearing, the trial court granted summary judgment finding that the LOI permitted Miller to opt out of the closing. CNX appeals. After reviewing the record, we find the trial court erred in granting summary judgment. The LOI only provided CNX with the option to opt out of the transaction. Accordingly, we reverse.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2011/cnx_051111.pdf

Court Reviews the Admissibility of Evidence in a Suit to Recover the Balance on a Past Due Account

BELLSOUTH ADVERTISING & PUBLISHING CORP. v. SENTAYEHU ABEBE, ET AL. (Tenn. Ct. App. April 29, 2011)


This appeal arises out of a suit to recover the balance on a past due account for an advertisement in a telephone directory. Defendant disputed the authenticity and admissibility of the documents submitted by plaintiff to establish an enforceable and valid contract. The trial court permitted the documents to be admitted and entered judgment for plaintiff. Defendant appeals, contending that the trial court erred in admitting the documents and in finding an enforceable contract. Finding no error, we affirm. 


Opinion available at:

http://www.tba2.org/tba_files/TCA/2011/bellsouthadv_042911.pdf

Court Reviews the Allocation of Debts and Expenses in a Case Involving the Dissolution of a Real Estate Partnership

T. VERNER SMITH v. JERRY F. GARDNER (Tenn. Ct. App. April 27, 2011)

This appeal involves a suit for dissolution of a real estate partnership. The defendant-appellee also filed several counterclaims against the plaintiff, who is an attorney. After a bench trial, the trial court dissolved the partnership and found that the defendant-appellant was liable for one-half of the partnership's debts and expenses. The court dismissed the counterclaims. We affirm.

Opinion available at:

http://www.tba2.org/tba_files/TCA/2011/smitht_042711.pdf

Court Reviews the Franchise Tax Liability of a Corporation that Operates Motion Picture Theaters

MALCO THEATERS, INC. v. RICHARD H. ROBERTS, COMMISSIONER OF REVENUE, STATE OF TENNESSEE (Tenn. Ct. App. April 26, 2011)



This appeal concerns the franchise tax liability of a corporation operating motion picture theaters in Tennessee. The Tennessee Department of Revenue assessed deficiencies against the corporation in 2001 and 2004 after audits revealed the corporation did not include the value of rented films within its minimum franchise tax base. The corporation filed separate lawsuits in chancery court disputing the assessments. After consolidating the cases, the chancery court granted summary judgment in favor of the corporation. We reverse the grant of summary judgment, grant partial summary judgment in favor of the Commissioner of Revenue, grant partial summary judgment in favor of the corporation, and remand. 


Opinion available at:

http://www.tba2.org/tba_files/TCA/2011/malcotheaters_042611.pdf

Court Reviews Whether Insurance Company had Indemnity in a Personal Injury Suit

EVEREST NATIONAL INSURANCE COMPANY v. RESTAURANT MANAGEMENT GROUP, LLC ET AL. (Tenn. Ct. App. April 25, 2011)


This is a declaratory judgment action filed by an insurance company against its insured and the insured's customer who allegedly was injured from a fall after stepping in a hole in the insured's parking lot.

The insurance company asked for a declaration that it was not obligated to defend and indemnify the insured against the customer's personal injury claim. The insured filed a counterclaim asking for a declaration that the insurer was required to defend the claim and indemnify the insured against liability to the customer.

On dueling motions for summary judgment, the trial court held that the insurance company was relieved of its obligation to defend and indemnify the insured because the insured waited five months before notifying the insurance company of the claim and that, as a consequence of the insured's delay, the insurer was prejudiced. During that five months, the insured repaired cracks in the parking lot where the fall allegedly occurred. The insured appeals. We affirm. 


Opinion available at:

http://www.tba2.org/tba_files/TCA/2011/everest_042511.pdf

U.S. Supreme Court: Oral complaints protected in workplace

Workers are protected from retaliation when they voice complaints about labor law violations, even if they don't write them down, the U.S. Supreme Court said today. At issue is statutory language protecting workers from retaliation if they have "filed any complaint." In his majority opinion, Justice Stephen G. Breyer said the purpose and context of the provision support the conclusion that the oral complaint was protected.

ABAJournal.com has the full story:
http://www.abajournal.com/news/article/supreme_court_rules_oral_workplace_complaints_are_protected_under_labor_law/

Court Reviews Whether Plaintiff Sufficiently Alleged the Futility of Demanding a Board of Directors to Initiate a Lawsuit

IN RE HEALTHWAYS, INC. DERIVATIVE LITIGATION (Tenn. Ct. App. March 15, 2011)

Plaintiff in shareholder derivative action appeals the dismissal of his suit alleging breaches of fiduciary duty and other misconduct, including insider trading, by current and former officers and directors of corporation. Plaintiff filed suit without first making demand on the board of directors of the corporation that the directors initiate the lawsuit. Defendants moved to dismiss the suit on the ground that plaintiff failed to allege with requisite particularity that such demand would have been futile. We affirm the dismissal of the action.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2011/healthways_COR_032411.pdf

Court Reviews Whether Individual Defendants are Additional Lessees Personally Liable Under a Commercial Lease

ASSOCIATED SHOPPING CENTER PROPERTIES, LTD. v. EDWARD H. HODGE ET AL. (Tenn. Ct. App. March 23, 2011)

The issue in this commercial real estate lease dispute is whether the individual defendants are additional lessees and, thus, personally liable under the lease. Plaintiff, the lessor of retail space, filed this action against the three defendants when the limited liability company, Decor Fabrics, LLC, a lessee, breached the lease by failing to pay rent for the term of the lease. The individual defendants denied liability, asserting that Decor Fabrics, LLC, was the only lessee.

The trial court found that the lease unambiguously identifies each of the individual defendants as additional lessees and assessed damages against them for breach of the lease, including the plaintiff's attorneys fees. Only one of the defendants appealed. He asserts that the trial court erred by finding the lease unambiguous as to the identify of the lessee(s) and by failing to consider the parties' conduct to conclude that Decor Fabrics, LLC, was the only lessee. We affirm.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2011/hodgee_032311.pdf

Two New Loan Initiatives Announced by Small Business Administration

Two New Loan Initiatives Announced by SBA: Small Loan Advantage and Community Advantage 7(a) Loan
 
SBA is committed to expanding access to capital for small businesses and entrepreneurs in underserved communities so that we can help drive economic growth and job creation. In line with that, SBA is rolling out two new initiatives on February 15, 2011, aimed at increasing the number of loans in these communities.

SBA and U.S. Department of Commerce studies have shown the importance of lower dollar loans to small business formation and growth in underserved communities. With that in mind, and building on the agency's "Advantage" platform, both Small Loan Advantage and Community Advantage will offer a streamlined application process for SBA 7(a) loans up to $250,000.

Published by the Tennessee Small Business Development Center, referencing:
http://www.sba.gov/advantage.

See also: 
http://www.sba.gov/category/navigation-structure/loans-grants/small-business-loans/sba-loan-programs/7a-loan-program.

Supreme Court: FOIA does not extend personal privacy to corporations

The Supreme Court recently ruled that corporations have no right of personal privacy to prevent the disclosure of documents under the federal Freedom of Information Act. At issue is information gathered by the Federal Communications Commission during an investigation of AT&T's participation in the federal E-Rate program, which helps schools and libraries get Internet access. "The protection in FOIA against disclosure of law enforcement information on the ground that it would constitute an unwarranted invasion of personal privacy does not extend to corporations," Roberts wrote. "We trust that AT&T will not take it personally."

Read the full story here:
http://www.wrcbtv.com/Global/story.asp?S=14163469

General Assembly News: Bill would abolish ban on corporate donations

A measure that overhauls Tennessee's campaign finance laws would abolish a longstanding ban on donations from companies, in a move that supporters say would put businesses on an equal footing with labor unions.

"I think there should be parity," said state Rep. Glen Casada, R-Franklin, the bill's sponsor in the state House of Representatives.

But the legislation could give corporations and special interests more influence over Tennessee politics, say opponents, and a survey of campaign finance records shows Tennessee's largest companies are already big donors to campaigns through their political action committees.

The Tennessean has the story:  
http://www.tennessean.com/article/20110306/NEWS02/103060385/1972/NEWS02/TN-Republicans-want-allow-direct-corporate-donations