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Family Owned Adult Business, Florida Injunction & Personal Jurisdiction at Center of Palm Beach Appeal — July 23, 2014

Uncategorized • Jul 26, 2014
post about Family Owned Adult Business, Florida Injunction & Personal Jurisdiction at Center of Palm Beach Appeal — July 23, 2014

The Palm Beach appeals court was in the middle of the adult entertainment industry– sort of. …. And a family fight after dad died: over a business with, who else, right?….. the widow, stepmother & stepchildren.  Control. Money. Lawsuits.  Enter the Florida estate litigators.

July 23, 2014 4th DCA Opinion on Personal Jurisdiction & Injunction

  • The Appeals court for Palm Beach and Broward Counties is Florida’s 4th District Court of Appeal
  • The 4th DCA is located in West Palm Beach and hears probate appeals as well as appeals of injunctions and legal battles over family-owned businesses
  • An opinion issued just 3 days ago by the 4th DCA dealt with a family owned and operated adult entertainment establishment in Michigan

2014 Text Boxes 002Family Voting Trust Holds Business

  • There was a Family Voting Trust which owned the businesses
  • Each beneficiary of the family voting trust was given a 1/5 interest in shares of stock
  • The father = managing trustee

Father Dies in 2010 — Stepmother & Stepson Sign Stock Purchase Agreement

  • The father died in 2010
  • The stepmother (and surviving spouse) became the managing trustee
  • The stepmother and widow also inherited the deceased father’s 1/5 interest
  • She controlled the bank accounts
  • It took 2/3 vote to remove the trustee
  • A stepson and the stepmother agree to buy the stepson’s interest
  • They sign a stock purchase agreement and Florida law applies
  • Venue = Broward County, Florida

Stepchildren Remove Stepmother as Trustee

  • The step children removed the stepmother as the trustee
  • The remaining beneficiaries seized control of the family business
  • At the heart of the family business lawsuit were allegations that unlawfully opening bank accounts and illegally diverting profits away from the stepmother

Stepmother Sues in Ft. Lauderdale (Broward County)

  • In the Ft. Lauderdale lawsuit over the family owned business
  • A stepson filed a motion to dismiss for lack of personal jurisdiction
  • The stepmother filed a motion for a temporary injunction
  • The stepson lost his motion to dismiss: the trial court found that it had personal jurisdiction over him
  • The stepmother won the temporary injunction
  • The 4th DCA reversed

Q:  Who should read this opinion issued just days ago by the Palm Beach Appeals Court?

Answer:   Anyone who is involved with

  • stock purchase agreements
  • trusts
  • contracts
  • forum selection clauses– (which can NOT operate as the sole basis for Florida to exercise jurisdiction over an objecting non resident Defendant)
  • Florida choice of law or governing law clauses
  • temporary injunctions

Here’s the link to read the entire opinion for free: http://4dca.org/opinions/July%202014/07-23-14/4D14-37.op.pdf