N.C. Business Court Opinions, September 23, 2025 – October 7, 2025
By: Austin T. Webber
Brown v. TM Northlake Mall, LP, 2025 NCBC 57 (N.C. Super. Ct. Sept. 29, 2025) (Conrad, J.)
Key Terms: discovery; wrongful death; Rule 12(b)(6); untimely; N.C.G.S. § 1-53(4); statute of limitations; equitable estoppel; concealment
As summarized here, these consolidated cases arose from a 2022 shooting at Northlake Mall that killed Armani Spencer and injured Plaintiffs Bianca Brown and Brianna Perkins. Brown and Spencer’s estate, and later Perkins, sued various entities associated with Defendants Northlake Commons shopping center and Northlake Mall.
During discovery, Plaintiffs discovered the alleged misconduct of Defendant AMMS, Inc. and its owners, Defendants Amy R. Thompkins and Michael McLaughlin. After obtaining leave to amend, Spencer’s estate amended its complaint to assert wrongful death claims against AMMS, Thompkins, and McLaughlin, each of whom moved to dismiss the claim as untimely pursuant to Rule 12(b)(6).
Under N.C.G.S. § 1-53(4), a wrongful death claim must be filed within two years of the date of death. Spencer’s estate argued that AMMS, Thompkins, and McLaughlin were equitably estopped from asserting the statute of limitations as a defense because any delay in filing suit against them resulted from their concealment of their role in providing security for Northlake Commons. The Court disagreed, concluding that the amended complaint did not allege that AMMS, Thompkins, or McLaughlin denied their involvement in providing security or that they lied during the investigation. The Court granted the motion to dismiss.
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iTi Commc’ns, LLC v. Seamon, Whiteside & Assocs., Inc., 2025 NCBC 58 (N.C. Super. Ct. Sept. 30, 2025) (Earp, J.)
Key Terms: Rule 15(d); motion to supplement; Rule 15(a); motion to amend; futility; moot; Rule 12(c); judgment on the pleadings; Rule 10(c); written instrument; breach of contract; breach of good faith and fair dealing; unjust enrichment; express contract; negligence; economic loss rule; conversion; N.C.G.S. § 44A-2; excused performance; unenforceable penalty; liquidated damages; motion to strike; sur-reply; BCR 7
This case involves a contractual dispute between Plaintiff iTi Communications, LLC and Defendant Seamon, Whiteside, and Associates, Inc. Plaintiff contracted to provide information technology services and equipment to Defendant under a Master Services Agreement and subsequent Statements of Work (the “Contract”). Pursuant to the Contract, Defendant gave Plaintiff ninety days’ notice that it intended to terminate the Contract, which triggered an early termination fee provision. Plaintiff invoiced Defendant for the fee, but prior to the end of the ninety-day notice period, Defendant discovered a data breach had occurred as a result of Plaintiff’s alleged failure to back up Defendant’s data.
Plaintiff sued Defendant for breach of contract, among other claims. Defendant asserted counterclaims for breach of contract, breach of the duty of good faith and fair dealing, unjust enrichment, negligence, and conversion. Plaintiff filed a Rule 12(c) motion as to its breach of contract claim and Defendant’s counterclaims, as well as a motion to strike Defendant’s sur-reply brief. Following a hearing on Plaintiff’s motions, Defendant filed a motion to supplement its answer with documents obtained in discovery, followed by an alternative motion to amend its answer.
Defendant’s Motion to Supplement the Pleadings. The Court elected to treat Defendant’s motion to supplement as a motion to amend, because the documents Defendant sought to attach to its answer involved events that predated its answer, rather than events that occurred after the answer was filed. Plaintiff argued that the motion to amend was futile, but because the Court granted in part and denied in part Defendant’s Rule 12(c) motion, the Court granted Defendant’s motion to supplement. The Court denied Defendant’s alternative motion to amend its answer as moot.
Plaintiff’s Motion for Judgment on the Pleadings. As an initial matter, the Court concluded that it could consider both the contracts attached to the complaint and Defendant’s proposed attachments when deciding Plaintiff’s Rule 12(c) motion, because all of the documents fell within the scope of “written instruments” under Rule 10(c).
Breach of Contract Counterclaim. Defendant alleged that Plaintiff breached the Contract by failing to provide continuous backup support of Defendant’s data; Plaintiff argued that this fell outside the scope of the Contract. Although the plain language of the Contract supported Plaintiff’s argument, the Court determined that it could not conclude that all relevant contractual obligations were before the Court and denied Plaintiff’s motion to dismiss this counterclaim.
Breach of Good Faith and Fair Dealing Counterclaim. Because Defendant’s counterclaim for breach of the implied covenant of good faith and fair dealing was based upon the same acts as its counterclaim for breach of contract, the Court granted the motion as to this counterclaim.
Unjust Enrichment Counterclaim. Because an express contract governed the dispute, the Court granted Plaintiff’s motion as to Defendant’s unjust enrichment counterclaim.
Negligence Counterclaim. The Court concluded that the economic loss rule barred Defendant’s recovery in tort for Plaintiff’s alleged failure to perform the Contract and granted Plaintiff’s motion as to Defendant’s negligence counterclaim.
Conversion Counterclaim. Defendant alleged that Plaintiff converted its servers after the Contract was terminated. Plaintiff argued that both the terms of the Contract and N.C.G.S. § 44A-2 permitted it to retain Defendant’s servers. Plaintiff also argued that the economic loss rule barred Defendant’s conversion counterclaim. The Court determined that Plaintiff was not entitled to judgment on the pleadings under any of these theories and denied the motion as to this counterclaim.
Breach of Contract Claim. Plaintiff sought judgment in its favor that Defendant breached the Contract by failing to pay the early termination fee. Defendant argued that it was excused from paying the fee due to Plaintiff’s prior breach of the Contract and, further, that the fee was an unenforceable penalty. The Court agreed that the pleadings contained allegations that Defendant’s performance was excused and denied Plaintiff’s motion as to this claim on that basis, but the Court concluded that the early termination fee constituted a valid liquidated damages provision.
Motion to Strike Sur-Reply Brief. The Court granted Plaintiff’s motion to strike Defendant’s sur-reply brief because BCR 7 does not permit the filing of sur-replies absent Court permission.
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Mayer v. Goldner, 2025 NCBC 59 (N.C. Super. Ct. Oct. 2, 2025) (Conrad, J.)
Key Terms: personal jurisdiction; minimum contacts; specific jurisdiction; physical contacts; intentional contact; defamation; unfair and deceptive trade practices; tortious interference with contract
Third-Party Defendant Grand Hook Agency, LLC is a limited liability company organized in Georgia by Third-Party Defendants Gabriel Mayer and Matthew Queen. Third-Party Plaintiff Sherbrooke Corporate Ltd. is a captive insurance company organized in North Carolina. Third-Party Plaintiff Samuel Goldner is the majority member of Sherbrooke; Mayer and Queen are officers, directors, and minority shareholders of Sherbrooke. Third-Party Plaintiffs alleged that Mayer and Queen created Grand Hook to compete with Sherbrooke and that Mayer and Queen used their positions within Sherbrooke to give Grand Hook a competitive edge, asserting claims for civil conspiracy, unfair and deceptive trade practices, and tortious interference with contract against Grand Hook. Grand Hook moved to dismiss for lack of personal jurisdiction.
Grand Hook argued that it did not have any physical contacts with North Carolina. The Court, however, concluded that the alleged defamatory statements made by Grand Hook’s principals, Mayer and Queen, to a North Carolina state agency were intentional conduct directed at North Carolina. The Court further determined that, liberally construed, the allegations of the complaint supported an inference that Sherbrooke’s injuries were felt primarily in North Carolina. The Court rejected Grand Hook’s merits-based argument regarding the impossibility of competing against a captive insurance company and Grand Hook’s argument that the actions of Mayer and Queen could not be attributed to it. The Court denied the motion.
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Valleygate Dental Surgery of Charlotte, LLC v. Farrell, 2025 NCBC 60 (N.C. Super. Ct. Oct. 7, 2025) (Houston, J.)
Key Terms: motion to dismiss; Rule 12(b)(3); improper venue; motion to transfer venue; N.C.G.S. § 1-82; N.C.G.S. § 1-83; residence of limited liability company
This case arose from a dispute over the ownership of a dental practice. Plaintiff Valleygate Dental Surgery of Charlotte, LLC is a North Carolina limited liability company that operates a dental surgery center in Charlotte, North Carolina. Plaintiff initiated this lawsuit in Cumberland County Superior Court, alleging in its complaint that its principal place of business was Cumberland County, North Carolina.
Defendants moved to dismiss for improper venue, arguing that Plaintiff’s principal place of business was actually Mecklenburg County and that no party was located in Cumberland County. Defendants alternatively moved to transfer the action to Mecklenburg County. However, Defendants conceded at the hearing that Plaintiff’s registered office and registered agent’s office were located in Cumberland County, and Defendants admitted in their verified answer to Plaintiff’s complaint that Plaintiff’s principal place of business was located in Cumberland County.
The Court concluded that, based on Defendants’ admissions, venue in Cumberland County was proper and denied the motion to dismiss. The Court further determined that Defendants failed to demonstrate that litigating in Cumberland County was unduly burdensome, expensive, inconvenient to witnesses, or contrary to the interests of justice and denied Defendants’ alternative motion to transfer venue.
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Covenant Clearinghouse LLC v. D.R. Horton, Inc., 2025 NCBC Order 69 (N.C. Super. Ct. Sept. 26, 2025) (Robinson, C.J.)
Key Terms: order on designation; N.C.G.S. § 7A-45.4(a)(9); declaratory judgment, breach of declaration; amount in controversy
Plaintiff Covenant Clearinghouse LLC initiated this action on 15 August 2025, asserting claims for declaratory judgment and breach of declaration against Defendant D.R. Horton, Inc. Defendant timely filed a notice of designation, seeking designation pursuant to N.C.G.S. § 7A-45.4(a)(9). Based on the allegations in the complaint, the Court could not determine whether the amount in controversy met the $1 million minimum threshold required by N.C.G.S. § 7A-45.4(a)(9)(c), so the Court concluded that the action was not properly designated as a mandatory complex business case.
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WP Church, LLC v. Whalen, 2025 NCBC Order 70 (N.C. Super. Ct. Sept. 26, 2025) (Davis, J.)
Key Terms: restaurants; preliminary injunction; likelihood of success on the merits; derivative claim; breach of fiduciary duty; business judgment rule; conflict of interest; duty of loyalty; ratification; statute of limitations; pre-suit demand; futility; irreparable harm; balancing the equities
Plaintiff WP Church, LLC and Defendant Patrick Whalen are two of the members of 5Church Charleston, LLC, a South Carolina limited liability company formed to operate a restaurant in South Carolina. Whalen is also the sole manager of 5Church. Whalen and the other members of 5Church (exclusive of Plaintiff) are also engaged in other restaurant ventures. Plaintiff alleged that Whalen caused 5Church to loan his other restaurants millions of dollars. Plaintiff further alleged that Whalen used 5Church’s funds to pay for legal expenses, rental payments, and automobile lease payments incurred by his other restaurants. Soon after initiating this action on 10 June 2025, Plaintiff discovered that Whalen continued to commingle 5Church’s funds with those of his other restaurants and filed a motion for preliminary injunction.
Whalen contended that Plaintiff was unlikely to succeed on the merits of its derivative claim for breach of fiduciary duty because (1) the terms of 5Church’s Operating Agreement permitted Whalen to make loans to his other restaurants; (2) Whalen was protected under the business judgment rule; (3) the loans were in the best interest of 5Church; (4) the other members of 5Church (exclusive of Plaintiff) supported making the loans; (5) Plaintiff ratified making the loans; (6) Plaintiff’s lawsuit was barred by the statute of limitations; and (7) Plaintiff’s pre-suit demand letter was insufficient under South Carolina law. The Court rejected all of Whalen’s arguments, determining that (1) no provision of 5Church’s Operating Agreement explicitly permitted Whalen to make loans to his other restaurants; (2) Whalen could not rely on the business judgment rule because his actions were based on a conflict of interest rather than good faith; (3) Whalen failed to provide sufficient evidence that the loans made to other restaurants sufficiently benefitted 5Church; (4) Whalen owed 5Church a duty of loyalty and neither 5Church nor its members benefitted from the loans; (5) Plaintiff did not ratify the loans by receiving regular financial statements when the statements did not disclose the terms of the loans and, further, any alleged ratification was revoked once Plaintiff made pre-suit demand and then filed suit; (6) a question of fact existed as to Whalen’s statute of limitations defense; and (7) Plaintiff’s pre-suit demand letter was sufficient and, alternatively, South Carolina law recognizes futility as a defense to a pre-suit demand letter.
Having concluded that Plaintiff had shown a likelihood of success on the merits of its derivative claim for breach of fiduciary duty, the Court determined that Plaintiff made a sufficient showing of irreparable harm as Whalen had repeatedly used 5Church’s funds for the benefit of his other restaurants and to the detriment of 5Church, even after receiving formal notice from Plaintiff via the pre-suit demand letters and the initiation of this suit. The Court concluded that a balancing of the equities favored the entry of a preliminary injunction in favor of Plaintiff. The Court granted the motion and enjoined Whalen from using 5Church’s funds outside the ordinary course of business.
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Action Learning Assocs., LLC v. Kenan-Flagler Bus. Sch. Exec. Educ. LLC, 2025 NCBC Order 71 (N.C. Super. Ct. Sept. 29, 2025) (Davis, J.)
Key Terms: motion to amend; BCR 7.4; BCR 7.2; BCR 7.10; supporting brief
As summarized here, this case arose from various disagreements between former collaborators Plaintiff Action Learning Associates, LLC and Defendant Kenan-Flagler Business School Executive Education LLC. After the Court decided Defendant’s motion to dismiss Plaintiff’s first amended complaint, Plaintiff filed a motion to amend and attached a proposed second amended complaint. Plaintiff did not file a supporting brief. Defendant opposed the motion, noting that Plaintiff had failed to comply with BCR 7.2. Plaintiff did not file a reply brief.
Pursuant to BCR 7.4, the Court decided the motion without a hearing, concluding that the motion to amend was not included in the types of motions that do not require an accompanying brief under BCR 7.10 because Plaintiff sought to add parties and new allegations through its motion. The Court denied Plaintiff’s motion without prejudice to refile it with a supporting brief.
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Buchanan v. Cameron, 2025 NCBC Order 72 (N.C. Super. Ct. Sept. 30, 2025) (Robinson, C.J.)
Key Terms: order on designation; opposition to designation; N.C.G.S. § 7A-45.4(a)(1); partnership; sole proprietorship; Chapter 59; complex and novel issues; tort claims
Plaintiffs initiated this action on 20 August 2025, asserting claims against Defendants for declaratory judgment, conversion, tortious interference with contract, and defamation per se. Plaintiffs simultaneously filed a notice of designation, and the case was designated as a mandatory complex business case under N.C.G.S. § 7A-45.4(a)(1). Defendants timely filed an opposition to designation.
Defendants argued that designation under N.C.G.S. § 7A-45.4(a)(1) was improper because the matter involved a determination as to whether certain businesses were sole proprietorships or partnerships. The Court disagreed, noting that disputes involving partnerships fell within the purview of N.C.G.S. § 7A-45.4 (a)(1) and that a complaint did not need to expressly reference Chapter 59 to qualify for designation under this subsection. Defendants further contended that the matter did not involve complex or novel issues, but the Court reiterated that designation did not require a particular level of complexity. The Court also rejected as irrelevant Defendants’ argument that the accompanying tort claims, by themselves, did not permit designation. The Court overruled the opposition and determined that the matter was properly designated as a mandatory complex business case under N.C.G.S. § 7A-45.4(a)(1).
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Am. Prods., Inc. v. Knight Hardwood Flooring Inc., 2025 NCBC Order 73 (N.C. Super. Ct. Oct. 3, 2025) (Robinson, C.J.)
Key Terms: order on designation; N.C.G.S. § 7A-45.4(a)(8); breach of contract; tortious interference with contract; unfair trade practices; civil conspiracy; confidential and proprietary information; misappropriation of trade secrets
Plaintiff American Products, Inc. initiated this action on 27 August 2025, asserting claims for (1) breach of employment contracts against its former employees, Defendants Benjamin Markovich, Bergen Blanton, and Charles N. Stinnett, III; (2) tortious interference with contract against the former employees’ new employer, Defendant Knight Hardwood Flooring Inc.; and (3) unfair trade practices and civil conspiracy against all Defendants. Defendnats timely filed a notice of designation, seeking designation pursuant to N.C.G.S. § 7A-45.4(a)(8). The Court declined to designate the matter as a mandatory complex business case because Plaintiff’s generalized claims involving confidential or proprietary information were not sufficient to bring a claim for misappropriation of trade secrets. The Court noted that while the complaint referred generally to “trade secrets” and included allegations that might have served as the basis for a misappropriation of trade secrets claim, Plaintiff chose not to allege such a claim.
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Grajales v. Tea Dating Advice Inc., 2025 NCBC Order 74 (N.C. Super. Ct. Oct. 7, 2025) (Robinson, C.J.)
Key Terms: order on designation; N.C.G.S. § 7A-45(a)(5); The Tea App; intellectual property; computer software; defense
Plaintiff Anthony Josue Grajales initiated this action on 25 August 2025, alleging that Defendants permitted users of The Tea App to post anonymous comments regarding Plaintiff’s alleged misconduct, including his name and business name. Plaintiff asserted claims for defamation (libel), false light invasion of privacy, intentional infliction of emotional distress, tortious interference with business relations, and negligence. Defendants The Tea App and Sean Cook timely filed a notice of designation, seeking mandatory complex business designation under N.C.G.S. § 7A-45(a)(5). The Tea App and Cook contended that resolution of the claims involved the performance of a computer software application, but the Court disagreed, concluding that the claims were tied to the alleged torts of others rather than the underlying intellectual property aspects of the app. The Tea App and Cook argued that they intended to seek dismissal of Plaintiff’s claims pursuant to section 230 of the Communication Decency Act, but the Court reiterated that a forecasted defense cannot serve as the basis for designation under N.C.G.S. § 7A-45(a)(5). The Court declined to designate the matter as a mandatory complex business case.
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