Archive for January, 2023

RCD Attorneys Named as 2023 Super Lawyers®


Rayburn Cooper & Durham, P.A. is pleased to announce that the following attorneys in the firm have been selected for inclusion in 2023 North Carolina Super Lawyers®:


2023 North Carolina Super Lawyers

Al Durham – Bankruptcy Business
Ross Fulton – Business Litigation
Kirk Hardymon – Business Litigation
Jack Miller – Bankruptcy
Rick Rayburn – Bankruptcy; Business/Corporate
Matthew Tomsic – Bankruptcy Rising Star


2023 North Carolina Top 100

Jack Miller
Rick Rayburn


2023 Top 25 Charlotte

Jack Miller
Rick Rayburn


Super Lawyers is an annual listing of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement.

The selections for this esteemed list are made by the research team at Super Lawyers, a Thomson Reuters business.  Each year, the research team at Super Lawyers undertakes a rigorous multi-phased process that includes a statewide survey of lawyers, independent research evaluation of candidates, and peer reviews by practice area.  Only 5% of North Carolina attorneys have been selected for inclusion in Super Lawyers.

Learn more about the selection process.

Posted 01/26/23

N.C. Business Court Opinions, January 4, 2023 – January 17, 2023

IQVIA, Inc. v. Cir. Clinical Sols., Inc., 2023 NCBC 1 (N.C. Super. Ct. Jan. 6, 2023) (Conrad, J.)

Key Terms: restrictive covenants; tortious interference with contract; unfair and deceptive trade practices; motion to dismiss; failure of consideration; evidence outside the pleadings; choice of law; public policy

This action arises after a high-level employee of IQVIA, Inc., Dana Edwards, left IQVIA and joined Circuit Clinical Solutions as its Chief Commercial Officer. IQVIA complains that Circuit Clinical induced Edwards to breach her noncompete and nondisclosure obligations to IQVIA. Circuit Clinical moved to dismiss arguing that the terms of the noncompete and nondisclosure agreement were unenforceable due to a failure of consideration.

Circuit Clinical argued that each of the alleged bases for consideration for Edwards’ noncompete agreement—continued employment, continued access to confidential information, and an equity award of restricted stock units—was illusory under North Carolina law. Although, the noncompete and nondisclosure agreement contained a Delaware choice of law provision, Circuit Clinical argued that the Court should instead apply North Carolina law for public policy reasons. To show that the equity award was illusory consideration under North Carolina law, Circuit Clinical offered a document titled “Award Agreement.” The Court declined to consider this outside document, which was neither the subject of nor referred to in the complaint, noting the fundamental rule that evidence outside the pleadings cannot be considered on a Rule 12(b)(6) motion. Nothing within the complaint itself suggested the equity award was illusory under Delaware or North Carolina law.

Regarding the choice of law argument, the Court held that, even assuming that application of Delaware law would be contrary to the public policy of North Carolina, Circuit Clinical had failed to show that North Carolina had a materially greater interest in the issue than Delaware and that North Carolina law would apply absent the choice of law provision, both requisite determinations which were better suited for summary judgment. Accordingly, the Court denied Circuit Clinical’s motion to dismiss.


Merrell v. Smith, 2023 NCBC 2 (N.C. Super. Ct. Jan. 11, 2023) (Robinson, J.)

Key Terms: summary judgment; insider information; breach of fiduciary duty; fraud by omission and concealment; fraud in the inducement; constructive fraud; negligent misrepresentation; North Carolina securities fraud; civil conspiracy

These cases arose out of an alleged fraudulent scheme carried out by Richard Siskey with the assistance of Defendants Mike and Jennifer Smith. Plaintiffs, former members of Carolina Beer & Beverage Group, LLC (“CBB”), brought suit alleging that Mike Smith, co-founder and holder at all times of at least 50% of the membership interests in CBB, and his wife, Jennifer Smith, shared insider information with Siskey, thereby enabling Siskey to purchase Plaintiffs’ interests, and then profit greatly from the merger of CBB nearly three years later in 2010.

After extensive discovery, the Smiths moved for summary judgment seeking dismissal of all remaining claims against them. For the following reasons, the Court granted the motions, dismissing with prejudice all claims against the Smiths.

Breach of Fiduciary Duty: Managers of an LLC owe fiduciary duties to the LLC, not its members. Plaintiffs did not bring a derivative claim on behalf of CBB alleging that Mike Smith breached his fiduciary duties as a manager. Members of an LLC also do not generally owe fiduciary duties to each other. The Court found it unlikely that any exception to this general rule applied to Mike Smith and even if he did owe fiduciary duties to the other members, the evidence did not support a breach of those duties. Jennifer Smith as a 1099 employee of CBB also did not meet the exceptional circumstances that must exist to create a fiduciary relationship between her and CBB’s members.

Fraud by Omission and Concealment: Fraud by omission and concealment can only arise when the plaintiff establishes that the defendant had a duty to disclose material information to plaintiff, or otherwise had a duty to speak. The Court found that Plaintiffs had failed to forecast any evidence demonstrating that Jennifer Smith had a duty to speak. Plaintiffs’ claim for fraud by omission and concealment against Mike Smith also failed because (1) any underlying breach of fiduciary duty claims had been dismissed, and (2) Mike Smith, in an October 1, 2007 letter to all CBB’s members, and prior to the sale to Siskey of any of Plaintiffs’ interests, disclosed and discussed the subject of a potential sale of CBB. Plaintiffs offered no evidence of other material information that Mike Smith may have disclosed to Siskey but not to them.

Fraud in the Inducement: Fraud in the inducement requires a false representation or concealment of material fact reasonably calculated to deceive made with the intent to deceive. The Court found that here Mike Smith disclosed substantially the same information to Siskey and to Plaintiffs prior to the sale of any of Plaintiffs’ interests and, moreover, Mike Smith and CBB demonstrated their transparency by informing all members of the potential sale via the October 1 letter. Plaintiffs also made no effort to discover the truth through reasonable diligence.

Constructive Fraud: A claim for constructive fraud requires plaintiffs to forecast evidence showing a relationship of trust and confidence and that the defendant took advantage of that position of trust in order to benefit himself. As to Jennifer Smith, the Court held that since it already found no fiduciary duty between her and Plaintiffs existed, that no position of trust and confidence existed either. Plaintiffs’ claims against Mike Smith failed, regardless of whether or not they could demonstrate a position of trust and confidence existed, because Plaintiffs offered no evidence that the Mike Smith benefited himself through his alleged misconduct.

Negligent Misrepresentation: Again, Plaintiffs failed to demonstrate that they justifiably relied on any alleged misrepresentations made by the Smiths as evidenced by their failure to investigate or inquire about any such misrepresentations related to CBB or its potential sale.

North Carolina Securities Fraud: Plaintiffs’ claims for securities fraud were barred by the applicable statute of limitations—no later than five years after the sale or contract of sale. The last sale of a Plaintiff’s membership interest in CBB was made in March 2008. The first lawsuit was not commenced until 2019.

Civil Conspiracy: Civil conspiracy is not an independent cause of action. Because all underlying claims of unlawful conduct against the Smiths were dismissed, none remained to support a claim for civil conspiracy. Moreover, Plaintiffs offered no evidence of an agreement between the Smiths and Siskey to engage in unlawful conduct.


McGriff Ins. Servs., Inc. v. Hudson, 2023 NCBC 3 (N.C. Super. Ct. Jan. 17, 2023) (Earp, J.)

Key Terms: motion to amend; motion to dismiss; employment agreement; restrictive covenants; interference with business; justifiable interference; misappropriation of trade secrets; UDTP; non-solicit; blue pencil

In this case, Plaintiff McGriff Insurance Services brought suit against Hudson (a former employee) and One Digital, Hudson’s new business, based on Hudson’s alleged violations of non-solicitation provisions in his employment agreement with McGriff. Hudson counterclaimed, contending that McGriff has interfered with his new business. Before the Court were Defendants’ motions to dismiss the complaint, Plaintiff’s motion to dismiss the counterclaims, and Plaintiff’s motion to amend the complaint to add Stetson, another former McGriff employee.

Hudson argued that the restrictive covenants are unenforceable against him and Stetson due to lack of consideration and because they are not sufficiently tailored to protect McGriff’s legitimate business interests. The Court disagreed and found that Hudson’s original offer of employment was sufficient to support continuing non-solicit obligations because the employment relationship renewed automatically each year and thus the contractual relationship between the parties was never broken. Regarding the breadth of the non-solicit provisions, the Court found that the employee non-solicit was narrowly drawn to protect McGriff’s legitimate interests, but that the customer non-solicit was partially overbroad due to potentially unrestricted time and the breadth of business activities covered. However, because the troublesome clause was distinctly separable, the Court exercised its discretion to blue pencil the provision so that it would be reasonably tailored to protect McGriff’s legitimate interests.

The Court granted McGriff’s Motion for Leave to Amend Complaint with respect to its breach of contract claim as to Hudson and denied Defendants’ corresponding motions to dismiss McGriff’s breach of contract claim with respect to the Hudson Employment Agreement.

As to Plaintiff’s Motion to Amend to add Defendant Stetson, the Court reviewed Stetson’s employment contract. Again, Defendants argued lack of consideration for the non-solicitation provisions of Stetson’s contract because she merely became eligible to receive an alleged discretionary bonus in exchange for agreeing to the restrictive covenants. The Court found that although Stetson’s contract omits a description of the bonus plan, there is no indication that such a plan did not yet exist, or that the bonus was discretionary. Consequently, the Court found that McGriff adequately pled that consideration in the form of eligibility for a bonus exists. The Court blue penciled the same language out of Stetson’s agreement and granted McGriff’s motion to amend its complaint to add a breach of contract claim against Stetson.

The Court found that the allegations of McGriff’s proposed amended complaint were sufficient to state a claim for misappropriation of trade secrets against all three defendants because despite Defendants’ arguments, McGriff does not have to prove that the listed documents and information constitute trade secrets. It must merely allege what it contends constitutes a trade secret sufficiently to allow the Defendants to understand that which they are accused of misappropriating. Additionally, McGriff alleges that Hudson, with the help of Stetson, has disclosed and used the trade secrets to benefit OneDigital, which in turn gave OneDigital an unfair competitive advantage. The Court held that these allegations were sufficient to survive both a Rule 12(b)(6) sufficiency challenge and a futility challenge under Rule 15. The Court granted Plaintiff’s motion to amend the misappropriation of trade secrets claim and denied Defendants’ corresponding motions to dismiss.

As to the tortious interference with contract claims, the Court focused on the fourth element of such a claim, whether Defendants had legal justification for allegedly inducing Hudson and Stetson to violate their contracts. The Court notes that competition in business constitutes justifiable interference in another’s business relations and is not actionable so long as it is carried on in furtherance of one’s own interests and by means that are lawful. However, if the Defendants were found to have misappropriated Plaintiff’s trade secrets, then the interference would be unlawful and unjustifiable. The Court granted Plaintiff’s motion to amend the tortious interference with contract claim and denied Defendants’ corresponding motions to dismiss.

The Court held that the from the face of the proposed amended complaint, it was not possible to discern whether McGriff alleges that it was deprived of contractual relationships that would otherwise have occurred but for Hudson’s alleged interference. Therefore, to the extent McGriff’s motion to amend sought to assert a claim for tortious interference with respect to the pharmacy proposals, it was denied. The motion to amend as to tortious interference with prospective business relations was otherwise granted and the Defendants’ corresponding motions to dismiss were denied.

Because the tortious interference and misappropriate claims survived, McGriff’s unfair and deceptive trade practices claims survived as well.

In his counterclaims for tortious interference with prospective economic advantage and unfair trade practices, Hudson alleged that a McGriff executive represented to a customer that Hudson had a non-compete and therefore the customer stayed with McGriff. The Court held that the issue is whether the executive’s statement was protected by the competitor privilege and thus, the counterclaims’ survival depends on whether the customer non-solicitation provision in Hudson’s Employment Agreement is, in fact, enforceable. Accordingly, the Court denied Plaintiff’s motion to dismiss Defendants’ counterclaims.


Winner’s Mktg., Inc. v. Cavazos, 2023 NCBC Order 1 (N.C. Super. Ct. Jan. 6, 2023) (Bledsoe, C.J.)

Key Terms: motion to exclude expert testimony; Rule 702; grey games; Daubert standard; gaming law; judicial appraisal

Plaintiffs are two entities, identically named, but formed in different states, North Carolina and Delaware. In June 2021, the Plaintiffs merged, with the Delaware corporation being the surviving entity. Defendant dissented to the merger and objected to surviving Delaware-organized Plaintiff’s valuation and payout of his shares in the North Carolina entity. Plaintiffs filed the present action seeking a judicial appraisal of the fair market value of Defendant’s shares.

Plaintiff produces and leases gaming devices that are unregulated and of unsettled legality in some states including North Carolina and Texas, from which the majority of Plaintiff’s revenue derives. In unregulated markets, such gaming devices are known as “grey games.” Plaintiff retained an expert witness, Jenson, to opine on the industry risk to grey games and thus assist in the valuation of the Defendant’s shares as of the merger date. Defendant moved to exclude Jenson as an expert witness and to strike his expert report and testimony.

Defendant challenged Jenson’s testimony and opinions under Rules of Evidence 702, 401, 402, and 403. After conducting a fact-specific analysis and application of the Daubert test, the Court held that Jenson’s testimony and report satisfied the first two prongs of the Daubert test and exercised its discretion to rule on the reliability of Jenson’s testimony following the presentation of evidence at trial. The Court also held that Jenson’s report was not duplicative or contradictory to another of Plaintiffs’ expert witnesses. The Court held that Jenson will be permitted to testify at trial and permitted Defendant to designate one additional rebuttal expert witness at trial. The Court deferred further ruling on the motion until at or after trial.


Bradshaw v. Maiden, 2022-NCCOA-917 (Jackson, J.)

Key Terms: N.C.G.S. 7A-27(a)(2); effective date; 12(b)(6); matters outside the pleadings; summary judgment; gross negligence; negligence misrepresentation; Securities Act secondary liability

This suit commenced in 2014 when Plaintiffs—several investors in a hedge fund run by Defendant Maiden—brought suit against Maiden, Maiden Capital, LLC, and SS&C (the fund’s administrator) for claims arising out of Plaintiffs’ injuries from investing in the fund. In 2015, the Business Court granted a 12(b)(6) dismissal, in part, of Plaintiffs’ claim against SS&C for gross negligence. In 2020, the Business Court granted summary judgment to SS&C on Plaintiffs’ remaining claims. Once the remaining claims involving the other parties were disposed of, Plaintiffs appealed the orders dismissing their claims against SS&C.  Appeal to the Court of Appeals rather than the Supreme Court was appropriate because the action was designated as a mandatory complex business case prior to the effective date of the amendments to N.C.G.S. [section] 7A-27(a)(2), which provide a direct right of appeal to the Supreme Court from a judgment of the Business Court.

On appeal, the Court affirmed for the reasons stated in the orders of the Business Court.

In a lengthy separate opinion, Judge Murphy concurred in affirming dismissal of Plaintiff’s claims for grossly negligent misrepresentation, civil conspiracy, and aiding and abetting constructive fraud, but dissented as to the majority’s affirmance of dismissal of the claims for negligence, gross negligence, negligent misrepresentation, Securities Act secondary liability, and punitive damages.

By Rachel E. Brinson and Ashley B. Oldfield

To subscribe to RCD’s Business Court Blast, email Ashley Oldfield at


The information in this article is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation.

Posted 01/18/23

RCD Associate Natalie Kutcher Selected for the 2023 Bar Leadership Institute


The Mecklenburg County Bar has selected Rayburn Cooper & Durham associate Natalie Kutcher for the 2023 Bar Leadership Institute (BLI). In its 21st year, BLI identifies and develops leaders for the Mecklenburg County Bar and Foundation by providing participants opportunities to develop their personal leadership potential and skills; become aware of leadership opportunities with the Bar and the greater Charlotte community; consider pressing Bar and community issues with peers and presenters of the highest caliber; and develop a spirit of lasting collegiality with their fellow participants.

Selection for BLI is competitive. The Bar chooses leaders based on their commitment and motivation to serve in leadership positions, their history of public service and involvement in charitable organizations, and their willingness to engage in meaningful work with the Bar or the Foundation, among other criteria.

In the program, Natalie and others will participate in 15 hours of continuing legal education, receive individual coaching by a leadership consultant, and attend the Bar’s annual Bar Leadership Dinner and a two-day retreat at the Whitewater Center. Topics covered in the CLEs include: leading through listening, storytelling, and relationships; the history and future of practicing law in Mecklenburg County; the role of race and poverty on Mecklenburg’s past and future; and diversity and inclusion in the county’s legal community and justice system.

Natalie graduated with honors from the University of North Carolina School of Law in 2019. Prior to law school, she taught high school World History with the Charlotte-Mecklenburg school system. Natalie focuses her practice at RCD on business litigation and commercial transactions. She also regularly contributes to the firm’s Business Court Blast publication and serves on the Mecklenburg County Bar Communications Committee.

Posted 01/10/23

Six RCD Attorneys Named to 2023 Business North Carolina’s Legal Elite – Two Attorneys #1 in Respective Categories


Six attorneys from Rayburn Cooper & Durham, P.A. have been recognized by their peers as 2023 “Legal Elite” in Business North Carolina Magazine’s annual list.

Each year, Business North Carolina sends ballot notices to every member of the N.C. State Bar living in North Carolina — asking each a simple question: Of the Tar Heel lawyers whose work you have observed firsthand, whom would you rate among the current best in these categories? Voters are not allowed to vote for themselves. They may select members of their firms only if they pick out-of-firm lawyers in the same categories, with the latter votes weighted more heavily. Attorneys who receive the most votes in their respective categories become permanent members of the “Legal Elite Hall of Fame.”

The RCD attorneys named to Business North Carolina’s 2023 “Legal Elite” are

Scott Cooper – Corporate

Al Durham – Bankruptcy

Ross Fulton – Litigation

Jack Miller – Bankruptcy

Matt Tomsic – Bankruptcy


Ross Fulton and Matt Tomsic were both ranked first in their respective fields and have joined the “Legal Elite Hall of Fame.”

In addition, Rick Rayburn was previously named to the “Legal Elite Hall of Fame” for Bankruptcy.


About Rayburn Cooper & Durham, P.A. (RCD)

For more than 35 years, Rayburn Cooper & Durham has served both businesses and individuals with bankruptcy and financial restructuring, business litigation and general corporate matters. The attorneys within the firm have extensive experience and provide creative solutions to help clients establish their enterprises, grow and prosper and also protect their rights, assets, and interests. Recognizing the unique needs of their clients, RCD does not represent large banks or financial institutions. RCD – The way forward.

Posted 01/04/23

N.C. Business Court Opinions, December 21, 2022 – January 3, 2023

Brown v. Onslow Bay Marine Grp., LLC, 2022 NCBC 84 (N.C. Super. Ct. Dec. 22, 2022) (Robinson, J.)

Key Terms: summary judgment; attorneys’ fees; notice; N.C.G.S. 6-21.2(5); promissory note; royalties

This action arose out of a dispute over three loans made by Plaintiff Brown to Defendant OBMG, evidenced by promissory notes in the amounts of $50,000.00, $100,000.00, and $300,000.00, each with substantially similar terms. Brown sued for breach of each note and sought to recover sums due and owing and attorneys’ fees. OBMG moved for summary judgment on all claims.

Regarding the $50,000.00 and $100,000.00 promissory notes, the Court concluded that there was no material dispute that the principal and interest had been repaid in full and granted OBMG summary judgment thereon. However, the Court found that a factual dispute remained related to the payment of royalties under both the $50,000.00 and $100,000.00 promissory notes and denied OBMG’s summary judgment motion related thereto. As to the $300,000 note, the Court denied summary judgment because the parties disputed whether or not there has been a default under the $300,000 note, an oral modification thereof, and the amount and payment of royalties due thereunder.

The Court granted OBMG summary judgment as to the claims for attorneys’ fees finding that Brown had failed to comply with the notice requirements of N.C.G.S. 6-21.2(5) because in his demands related to the $50,000.00 and $100,000.00 promissory notes he stated that the amount due under the notes was “to be determined” which the Court found insufficient and Plaintiff stated that the outstanding amount must be “made” not “paid” and therefore did not adequately notify OBMG that payment was required to avoid liability for attorneys’ fees. The notice in the $300,000.00 note was also found insufficient for using the word “made” instead of “paid.”


By Rachel E. Brinson


To subscribe to RCD’s Business Court Blast, email Ashley Oldfield at

The information in this article is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation.

Posted 01/04/23