Claims Arising from Failed Stock Purchase Fall on Summary Judgment
Joe Kingma won summary judgment for a law firm in the United States District Court for the Northern District of Georgia. Plaintiff alleged the law firm had represented it in a relatively complex attempted stock purchase. It pointed to two separate draft engagement letters and testified it had relied on the law firm’s work. Needless to say, the acquisition failed, and one investor was out a substantial sum of money. Plaintiff claimed the law firm agreed to paper up the stock purchase, as well as line up new financing for the company. When the stock purchase was unsuccessful, it claimed the law firm breached its fiduciary duty by bringing suit on behalf of the disgruntled investor. The court ruled that despite the Plaintiff’s testimony, there was insufficient evidence to show that the Plaintiff and the law firm had an attorney-client or fiduciary relationship or that the Plaintiff was a third-party beneficiary of the law firm’s work. Plaintiff’s summary judgment motion was also denied. This case may be appealed, so watch this space for further developments.