N.C. Business Court Opinions, April 8, 2026 – April 21, 2026
Chalk v. Chalk, 2026 NCBC 31 (N.C. Super. Ct. Apr. 9, 2026) (Earp, J.)
Key Terms: summary judgment; Rule 56; closely-held corporation; Age Discrimination in Employment Act; Title VII of the Civil Rights Act of 1964; wrongful discharge; North Carolina Equal Employment Practices Act; N.C.G.S. § 143-422.2; breach of fiduciary duty; minority shareholder; breach of shareholders’ agreement; condition precedent; excused performance; breach of implied covenant of good faith and fair dealing; declaratory judgment
This matter arises from a dispute among shareholders of a closely-held corporation. Defendant was a 25% shareholder, director, and long-time employee of Plaintiff Chalk & Gibbs, Inc. After his relationship with the other shareholders soured, Defendant’s employment was terminated, he was removed as a director, and the other shareholders contended that they purchased his shares in the corporation. Plaintiffs initiated this action seeking declaratory relief regarding the status of Defendant’s shares in Chalk & Gibbs. Defendant asserted counterclaims related to the termination of his employment and for breach of fiduciary duty and breach of the shareholders’ agreement. Defendant moved for summary judgment on Plaintiffs’ claim for declaratory judgment and his counterclaim for breach of the shareholders’ agreement; Plaintiffs moved for summary judgment on their declaratory judgment claim and Defendant’s counterclaims.
Employment Discrimination Claims. Plaintiffs argued that Defendant’s counterclaims for age discrimination under the Age Discrimination in Employment Act, retaliation pursuant to Title VII of the Civil Rights Act of 1964, and wrongful discharge in violation of N.C.G.S. § 143-422.2 failed because of Defendant’s status as an owner and director of Chalk & Gibbs. Defendant contended that he fell within the definition of an “employee” because the other shareholders prevented him from participating in corporate decision-making. The Court determined that Defendant did not meet the definition of “employee” based on the amount of control he exercised over Chalk & Gibbs and granted Plaintiffs’ motion for summary judgment on these counterclaims.
Breach of Fiduciary Duty. Defendant argued that, as a minority shareholder, the remaining three shareholders owed him fiduciary duties and engaged in actions that breached those duties. Plaintiffs contended that the remaining shareholders neither owed Defendant fiduciary duties nor breached any such duties, arguing that Defendant’s characterization of the other shareholders as “controlling shareholders” was misplaced. The Court determined that the other shareholders did not owe Defendant fiduciary duties, because they did not exercise domination and control over Defendant or act together to divest Defendant of his ownership interest for personal gain. The Court granted Plaintiffs’ motion and dismissed this counterclaim.
Breach of Shareholders’ Agreement. Defendant first argued that Plaintiffs did not satisfy a condition precedent to purchasing his shares in a shareholders’ agreement. The Court agreed, granting Defendant’s motion and denying Plaintiffs’ motion as to this breach. Defendant next argued that, because Plaintiffs’ failure to satisfy the condition precedent constituted a material breach of the shareholders’ agreement, he was excused from the obligation to sell his shares. The Court disagreed, holding that the breach was not material and Defendant was bound by the terms of the shareholders’ agreement. The Court nevertheless determined that there was a genuine question of material fact regarding why Defendant’s request to transfer some of his shares to his son prior to his son’s discharge was not effectuated, and denied Defendant’s motion as to this breach. The Court similarly denied Defendant’s motion as to Defendant’s remaining counterclaims for breach of the shareholders’ agreement, concluding that genuine issues of material fact precluded summary judgment.
Breach of Implied Covenant of Good Faith and Fair Dealing. Although Plaintiffs argued that Defendant did not allege a counterclaim for breach of the implied covenant of good faith and fair dealing, the Court concluded that it was included in his counterclaim for breach of the shareholders’ agreement. The Court granted Defendant’s motion to the extent that it was related to Plaintiffs’ failure to satisfy a condition precedent to purchasing his shares and denied Plaintiffs’ motion as to this counterclaim.
Declaratory Judgment. The Court granted Defendant’s motion and denied Plaintiffs’ motion regarding Plaintiffs’ failure to satisfy a condition precedent to purchasing Defendant’s shares. The Court determined that there were genuine issues of material fact regarding the other declarations sought by Plaintiffs and denied both the parties’ motions as to these requests.
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KJET Ventures, LLC v. Jamison, 2026 NCBC 32 (N.C. Super. Ct. Apr. 14, 2026) (Houston, J.)
Key Terms: motion for sanctions; Rule 11; Rule 37; inherent authority; false statements; improper purpose; BCR 10.9; discovery; limited appearance; undue burden; undue delay; prejudice; strike pleadings; default; Rule 41; motion to dismiss; moot
As previously summarized here, the Court sanctioned Defendants’ attorney pursuant to Rule 11 for his repeated failures to comply with the Business Court Rules and court orders. In addition to these procedural violations, Defendants made false statements in their affidavits filed in support of a preliminary injunction motion and, although Plaintiff’s counsel apprised Defendants’ attorney of this fact, Defendants never amended or corrected their affidavits. After conducting a BCR 10.9 conference, the Court ordered Defendants to supplement their responses to Plaintiff’s discovery requests, but Defendants failed to comply with the Court’s order.
Plaintiff and Third-Party Defendants (“Movants”) subsequently moved for sanctions pursuant to Rules 11 and 37 and, one day after the Court permitted Defendants’ attorney to withdraw as counsel, Defendants’ attorney purported to enter a “limited appearance” on behalf of Defendants for the purpose of responding to the sanctions motion. The Court reiterated that a “limited appearance” does not relieve counsel of the obligation to represent a party until the Court grants counsel leave to withdraw. At the hearing on Movants’ motion, Defendants conceded that they failed to comply with the Court’s BCR 10.9 order.
The Court concluded that sanctions were warranted pursuant to Rules 11, 37, and 41 of the North Carolina Rules of Civil Procedure and its inherent authority because, in addition to the repeated procedural violations, (1) Defendants made misrepresentations in their affidavits for improper purposes and failed to correct them; and (2) Defendants’ failure to comply with the Court’s BCR 10.9 order created an undue burden on Movants, unduly delayed the litigation, and prejudiced Movants’ ability to conduct discovery. Having considered (and previously imposed) lesser sanctions, the Court struck Defendants’ answer, affirmative defenses, counterclaims, and third-party claims and entered default against Defendants on Plaintiff’s claims. The Court denied Movants’ separate motions to dismiss as moot.
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Cranford v. Hintz, 2026 NCBC 33 (N.C. Super. Ct. Apr. 15, 2026) (Robinson, C.J.)
Key Terms: motion to dismiss; Rule 12(b)(6); family farm; limited liability company; pre-suit demand; N.C.G.S. § 57D-8-01; breach of fiduciary duty; de jure fiduciary duties; majority members; de facto fiduciary duties; N.C.G.S. § 57D-3-21; negligence; unopposed; receiver; N.C.G.S. § 1-507.24; dissolution; N.C.G.S. § 57D-2-20; N.C.G.S. § 57D-6-02; remedies; declaratory judgment
Plaintiff Cranford and Defendants Hintz, McCachren-Shah, Raymer, and Steele are siblings and members of Steele Family Farms, LLC, which held five parcels of land. Plaintiff sent Defendants a demand letter, requesting that the company determine the optimal use of the property and investigate Defendant Steele’s personal use of the property (including possible self-dealing transactions), whether the company should be dissolved, and whether company assets were being wasted. She also complained about the failure of the company to observe corporate formalities and the current gridlock among the members in managing the company. Plaintiff initiated suit against Defendants, asserting claims for breach of fiduciary duty, unfair and deceptive trade practices, negligence, appointment of a receiver pursuant to N.C.G.S. § 1-507.24, dissolution pursuant to N.C.G.S. §§ 57D-2-20 and 57D-6-02, and declaratory judgment. Defendants filed two motions to dismiss Plaintiff’s Amended Complaint.
Pre-suit Demand. Defendants argued that Plaintiff’s derivative claims should be dismissed for failure to give sufficient pre-suit demand, contending that Plaintiff’s demand was self-interested and brought under the incorrect statute. Hintz, McCachren-Shah, and Raymer additionally contended that the demand was made on the members rather than the LLC and Steele contended that it lacked a clear demand for company action. The Court disagreed, concluding that Plaintiff’s demand was sufficient to meet the requirements of N.C.G.S. § 57D-8-01, and denied the motions to dismiss Plaintiff’s derivative claims on this basis.
Breach of Fiduciary Duty. Plaintiff alleged that Defendants breached fiduciary duties owed to her individually and to the LLC; Defendants argued that they did not owe Plaintiff or the company fiduciary duties. The Court concluded that Defendants did not owe Plaintiff fiduciary duties individually, because there were no allegations that Defendants, as a collective majority, exercised control over the LLC, and the Court granted the motions as to Plaintiff’s individual claim for breach of fiduciary duty. Defendants argued that the operating agreement eliminated any fiduciary duties the member-managers owed the company, but the Court concluded that the operating agreement limited, rather than eliminated, those duties and denied the motions as to Plaintiff’s derivative claim for breach of fiduciary duty.
Negligence. Although Plaintiff’s negligence claim rested on two bases, Plaintiff did not respond to Defendants’ argument that it was based solely on her underlying individual claim for breach of fiduciary duty. The Court considered the argument unopposed and granted the motions since the underlying claim was dismissed.
Receivership and Dissolution. The Court granted the motions and dismissed these claims because they are remedies, not separate causes of action.
Declaratory Judgment. Plaintiff sought a declaratory judgment regarding three provisions of the operating agreement related to the members’ ability to dissolve the company. The Court granted the motions as to the first provision at issue, noting that there was no existing controversy as that issue only addressed the death or bankruptcy of a member. The Court granted the motions as to the latter two provisions because Defendants agreed with Plaintiff’s interpretation of those provisions, thus eliminating any dispute.
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Implus Footcare, LLC v. Vore, 2026 NCBC 34 (N.C. Super. Ct. Apr. 15, 2026) (Davis, J.)
Key Terms: motion for judgment on the pleadings; Rule 12(c); unfair and deceptive trade practices; BCR 7.4; Noerr-Pennington doctrine; learned profession exemption; proximate cause
As previously discussed here, this dispute involves two competitors within the footcare accessories and shoe care industry. Defendant Blue San, LLC asserted a counterclaim for unfair and deceptive trade practices against Plaintiff Implus Footcare, LLC, and Plaintiff moved to dismiss seven of the ten acts on which Blue San’s counterclaim is based pursuant to Rule 12(c). The Court ruled on the motion without a hearing as permitted by BCR 7.4.
Plaintiff argued that Blue San’s UDTP claim was barred to the extent that it was based on (1) Plaintiff’s initiation of suit under the Noerr-Pennington doctrine; (2) communications among counsel for the parties based on the “learned profession” exemption; and (3) acts that did not proximately cause Blue San any actual injury. The Court denied the motion, concluding that a more developed factual record was needed to assess the parties’ arguments.
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Cadieu Tree Experts, Inc. v. Wiedner, 2026 NCBC 35 (N.C. Super. Ct. Apr. 15, 2026) (Shirley, J.)
Key Terms: motion to dismiss; Rule 12(b)(6); Rule 13(h); North Carolina Wage and Hour Act; N.C.G.S. § 94-25.1; breach of contract; unjust enrichment; slander of title; lis pendens; infliction of emotional distress; punitive damages; remedy; motion to strike; Rule 12(f); affirmative defenses
Individual Plaintiffs Marion Cadieu and Joseph Cadieu and Third-Party Defendants are all members of the Cadieu family who run a family business, Plaintiff Cadieu Tree Experts, Inc. (collectively, “Movants”). Plaintiffs initiated suit against the Wiedner Defendants, former employees, alleging that they had stolen funds from the corporation and engaged in other employee misconduct.
The Wiedner Defendants responded by filing counterclaims against Plaintiffs and Third-Party Defendants, alleging that the Individual Plaintiffs and Third-Party Defendants mismanaged the corporation’s finances such that the Wiedner Defendants had to fund corporate expenses and employee salaries from their personal financial accounts. The Wiedner Defendants further alleged that Cadieu Tree failed to pay them wages and commission payments to which they were entitled. Plaintiffs moved to dismiss six of the counterclaims pursuant to Rules 12(b)(6) and 13(h) and to strike four of the Wiedner Defendants’ affirmative defenses pursuant to Rule 12(f). Third-Party Defendants moved to dismiss five of the counterclaims pursuant to Rules 12(b)(6) and 13(h).
Rule 13(h). Plaintiffs contended that the joinder of Third-Party Defendants was unnecessary to grant complete relief, arguing that the counterclaims were either facially insufficient or irrelevant to the current litigation. The Court disagreed, concluding that the significant factual and legal overlap among the allegations involving Plaintiffs and Third-Party Defendants required the joinder of Third-Party Defendants. The Court confirmed that Rule 13(h) did not require the Wiedner Defendants to file a separate motion to add Third-Party Defendants as parties.
North Carolina Wage and Hour Act. Movants contended that the allegations in the counterclaims did not describe with particularity the wages and compensation that the Wiedner Defendants claim that they were owed. The Court disagreed, concluding that the allegations sufficiently stated claims for violations of the North Carolina Wage and Hour Act. The Court denied the motions as to this counterclaim.
Breach of Contract. The Court concluded that the Wiedner Defendants adequately stated claims for breach of contract based on Cadieu Tree’s alleged failure to reimburse them for expenses and to pay wages and commissions and denied the motions as to this counterclaim.
Unjust Enrichment. Movants contended that the Wiedner Defendants failed to sufficiently plead the benefit they allegedly conveyed on each particular party, but the Court disagreed and denied the motions as to this counterclaim.
Slander of Title. Movants argued that the Wiedner Defendants’ “conclusory” allegations were insufficient to state a claim and further that they had failed to adequately allege special damages. The Court disagreed and denied the motion as to this counterclaim. The Wiedner Defendants adequately alleged that Movants improperly filed a notice of lis pendens containing false representations for the purpose of harassing the Wiedner Defendants and jeopardizing their ability to fund their defense of the lawsuit. Further, their allegations that the notice of lis pendens prevented them from drawing funds from an existing line of credit were sufficient to allege special damages.
Intentional and Negligent Infliction of Emotional Distress. The Court concluded that the Wiedner Defendants failed to state a claim for either intentional or negligent infliction of emotional distress arising from a newspaper article written by a third party, because none of the Movants provided any comment on the article and the article only included publicly available information. The Court further concluded that the Wiedner Defendants failed to allege (1) that any of the Movants engaged in extreme or outrageous conduct; (2) that Movants breached a legal duty that they owed to the Wiedner Defendants; or (3) any specific details of the alleged severe emotional distress. The Court granted the motions as to these counterclaims.
Punitive Damages. The Court granted the motions as to this counterclaim because it is a remedy rather than a cause of action.
Affirmative Defenses. The Court noted that a motion to strike affirmative defenses under Rule 12(f) uses the same standard as a motion to dismiss claims under Rule 12(b)(6). The Court concluded that the allegations in the counterclaims were sufficient to give Plaintiffs and Third-Party Defendants notice of the Wiedner Defendants’ affirmative defenses and denied Plaintiffs’ motion on this basis.
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Xchange Tech. Rentals, LLC v. UK Atlanta Holdings, LLC, 2026 NCBC 36 (N.C. Super. Ct. Apr. 10, 2026) (Davis, J.)
Key Terms: summary judgment; Rule 56; termination; operating agreement; unjust enrichment; breach of contract; affirmative defenses; excused performance; genuine issue of material fact; declaratory judgment; non-disclosure agreement; fraud; constructive fraud; embezzlement; conversion; release
Plaintiff McFarlane was the CEO of non-party Damovo Group, which consisted of a number of entities located in the United States and Europe. Defendant UK Atlanta Holdings, LLC was a holding company for some of the Damovo Group entities, including Defendant Lares Holdings, LLC. In 2020, McFarlane entered into two Incentive Unit Agreements: one with UK Atlanta and one with Lares. The Incentive Unit Agreements incorporated the terms of each company’s respective operating agreement.
After the Damovo Group defaulted on its refinancing agreement in 2023, McFarlane’s personal company, Plaintiff Xchange Technology Rentals, LLC, entered into a Services Agreement with UK Atlanta in which McFarlane agreed to continue to serve as Damovo Group’s CEO in exchange for guaranteed termination payments. A non-disclosure agreement accompanied the Services Agreement. In 2024, Damovo Group’s board of directors terminated McFarlane for cause, alleging that he had breached the Services Agreement and was not entitled to the termination payments thereunder or the units he had received under the Incentive Unit Agreements.
This lawsuit followed and Plaintiffs asserted claims against Defendants for breach of the Services Agreement, unjust enrichment (in the alternative), breach of the Incentive Unit Agreements and associated operating agreements, and declaratory judgment. Defendants asserted counterclaims against Plaintiffs for breach of the Services Agreement, breach of fiduciary duty, fraud, constructive fraud, embezzlement, conversion, and declaratory judgment. Plaintiffs and Defendants filed cross-motions for summary judgment.
Unjust Enrichment. Because the parties agreed that express, written contracts governed their relationship, the Court concluded that McFarlane could not seek to recover under a theory of implied contract. The Court denied Plaintiffs’ motion, granted Defendants’ motion, and dismissed this claim with prejudice.
Breach of Services Agreement and Declaratory Judgment. McFarlane contended that he fully performed his obligations under the agreement and, even if Defendants had cause to terminate him, he was entitled to the guaranteed termination payments. Defendants argued that because McFarlane did not perform his obligations, they were excused from making the payments. The Court concluded that genuine issues of material fact existed as to whether McFarlane committed various material breaches of the Services Agreement that would excuse Defendants’ performance thereunder. The Court denied both motions as to McFarlane’s claim for breach of the agreement, UK Atlanta’s counterclaim for breach of the agreement, and UK Atlanta’s request for a declaratory judgement as to the rights and obligations of the parties under the agreement.
Breach of the Incentive Unit Agreements and Operating Agreements and Declaratory Judgment. McFarlane contended that Defendants breached their respective Incentive Unit Agreements and operating agreements by revoking his ownership of the incentive units after his termination and sought a declaratory judgment that he remained the owner of those units. Defendants sought a declaratory judgment that McFarlane forfeited his interest in the incentive units when he was terminated for cause. The Court concluded that genuine issues of material fact precluded summary judgment on any of the claims, thereby denying the motions as to McFarlane’s claims for breach of the Incentive Unit Agreements and operating agreements and the parties’ competing declaratory judgment claims as to the status of McFarlane’s ownership of the incentive units.
Breach of Non-Disclosure Agreement. Defendants contended that McFarlane breached the non-disclosure agreement by failing to return confidential information that belonged to Damovo Group. Because McFarlane’s counsel conceded at the hearing that McFarlane had failed to return some confidential information, the Court denied Plaintiffs’ motion and granted Defendants’ motion as to the issue of liability on this counterclaim.
Conversion. UK Atlanta argued that McFarlane refused to return two laptops after his termination. The Court concluded that there was a genuine issue of material fact as to the rightful owner of the laptops and denied the parties’ motions as to this counterclaim.
Breach of Fiduciary Duty, Fraud, Constructive Fraud, and Embezzlement. Because Defendants’ remaining counterclaims were based on the same underlying facts, the Court concluded that genuine issues of material fact precluded summary judgment on them for the same reasons and denied McFarlane’s motion as to these counterclaims.
Affirmative Defense – Release. McFarlane argued that Defendants’ counterclaims were barred in whole or in part based on a mutual release of claims in the Services Agreement which released McFarlane from liability for all claims based on his acts or omissions occurring on or before 12 May 2023. The Court again concluded that issues of genuine material fact remained and denied Plaintiffs’ motion on this basis.
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Allianz PCREL US Debt S.A. v. BLV Ascend LLC, 2026 NCBC Order 35 (N.C. Super. Ct. Apr. 9, 2026) (Robinson, C.J.)
Key Terms: motion to dismiss; Rule 41(a); voluntary dismissal without prejudice; breach of contract; general receivership; N.C.G.S. § 1-507.24; N.C.G.S. § 1-507.37(a)
This matter involves a default on a multi-million-dollar loan. Plaintiff sought the appointment of a receiver over BLV Ascend LLC and BLV Ascend II LLC (“Borrower Defendants”) and asserted a breach of contract claim against Benjamin and Ellie Perlman (“Guarantor Defendants”). After the Court appointed a general receiver over the Borrower Defendants, Plaintiff moved to dismiss the claim asserted against the Guarantor Defendants and continue the receivership over the Borrower Defendants. The Court determined that Plaintiff could dismiss its breach of contract claim without Court action and denied the motion without prejudice to Plaintiff’s right to file a notice of voluntary dismissal without prejudice. The Court further determined that the dismissal of the breach of contract claim had no bearing on the receivership action and denied Plaintiff’s motion to continue the receivership as moot.
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Lexington Ins. Co. v. State of N.C., 2026 NCBC Order 36 (N.C. Super. Ct. Apr. 10, 2026) (Houston, J.)
Key Terms: wrongful conviction; motion to stay; insurance coverage; judgment; federal court action; Rule 2.1 of the General Rules of Practice for the Superior and District Courts; N.C.G.S. § 1-75.12; substantial injustice; first filed; natural plaintiff; choice of forum; convenience to parties; matters of local concern
McCollum and Brown were wrongfully convicted by the State of North Carolina. Upon their release from prison, McCollum and Brown sued Defendants Snead and Allen in federal district court and obtained a money judgment against them (“Federal Court Action”). Plaintiff Lexington Insurance Company subsequently sued Defendants State of North Carolina, North Carolina Public Officers and Employees Liability Insurance Commission, Allen, and representatives of the estates of McCollum, Brown, and Snead in Wake County Superior Court (“State Court Action”) to determine whether Plaintiff’s policies provided coverage in connection with the judgment obtained by McCollum and Brown.
The federal court then permitted the plaintiffs in the Federal Court Action to file a supplemental complaint related to the execution of the federal court’s prior judgment. The supplemental complaint involved some of the same issues as the State Court Action, but also included different parties and causes of action. McCollum’s and Brown’s representatives (“Movants”) moved to dismiss or stay the State Court Action. The motion to dismiss was granted, Plaintiff appealed, and the North Carolina Court of Appeals reversed. The matter was designated as exceptional under Rule 2.1 of the General Rules of Practice for the Superior and District Courts and assigned to the Business Court, which addressed Movants’ motion to stay.
The Court denied the motion, concluding that Movants had failed to demonstrate how litigating similar disputes in two forums would result in substantial injustice based on the following factors: (1) as determined by the Court of Appeals, the State Court Action was the first filed action; (2) the Federal Court Action would not resolve all claims against all parties in the State Court Action; (3) Movants’ motion to dismiss and Plaintiff’s subsequent appeal caused the delays in the State Court Action; (4) Movants’ arguments about the timeline or results of a pending summary judgment motion in the Federal Court Action were speculative; (5) because Plaintiff was a natural plaintiff in relation to the non-Movant defendants in the State Court Action, Plaintiff’s choice of forum was entitled to deference; (6) because the two forums were located within a mile of each other, the convenience to witnesses, availability of compulsory process, and access to sources of proof were identical; (7) the Business Court was able to interpret and resolve issues of North Carolina law; and (8) North Carolina had an interest in litigating matters of local concern in its courts.
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Huggins v. Beggen, 2026 NCBC Order 37 (N.C. Super. Ct. Apr. 14, 2026) (Robinson, C.J.)
Key Terms: order on designation; N.C.G.S. § 7A-45.4(a)(1); N.C.G.S. § 7A-45.4(c); untimely service; basis for designation
Plaintiffs filed their Complaint and Notice of Designation on March 30, 2026, seeking designation as a mandatory complex business case pursuant to N.C.G.S. § 7A-45.4(a)(1). The next day, Plaintiffs served the Notice of Designation and supporting documents on the Chief Justice of the Supreme Court of North Carolina and the Chief Business Court Judge via email. The Court determined that the matter was not properly designated as a mandatory complex business case because (1) Plaintiffs did not contemporaneously file the Notice of Designation in superior court and serve it on the Chief Justice and Chief Business Court Judge via email as required by N.C.G.S. § 7A-45.4(c); and (2) Plaintiffs failed to provide any basis or explanation for designation in their Notice of Designation as required by N.C.G.S. § 7A-45.4(c).
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Cycurion, Inc. v. ACCESS Newswire Inc., 2026 NCBC Order 38 (N.C. Super. Ct. Apr. 15, 2026) (Robinson, C.J.)
Key Terms: order on designation; N.C.G.S. § 7A-45.4(a)(2); securities; tangential relationship; N.C.G.S. § 7A-45.4(b)(2)
Plaintiff filed its Complaint and Notice of Designation on April 1, 2026, seeking designation as a mandatory complex business case pursuant to N.C.G.S. § 7A-45.4(a)(2) and (b)(2). The dispute involved an allegedly false media release by Defendants that negatively impacted Plaintiff’s stock value and shareholder equity. The Court determined that the case was not properly designated as a mandatory complex business case pursuant to N.C.G.S. § 7A-45.4(a)(2) because there was only a tangential relationship between securities and the allegations in the Complaint. The Court further determined that the matter did not qualify for designation pursuant to N.C.G.S. § 7A-45.4(b)(2) because it did not first qualify for designation under (a)(2).
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Estevez v. C&S Com., LLC, 2026 NCBC Order 39 (N.C. Super. Ct. Apr. 16, 2026) (Houston, J.)
Key Terms: motion for leave to amend; Rule 15(a); discovery; Rule 8 of the North Carolina Rules of General Practice for the Superior and District Courts; BCR 10.4(a); undue delay; alter the scope of the litigation; undue prejudice
Plaintiffs filed their initial Complaint in April 2025, asserting four claims against Defendants. Plaintiffs moved to amend their Complaint to add three additional defendants and at least six new causes of action in March 2026. The Court determined that the delay in discovering the new information that prompted Plaintiffs to move to amend their Complaint resulted from Plaintiffs’ unreasonable delay in serving written discovery requests on Defendants. The Court denied Plaintiffs’ motion, concluding that Plaintiffs had unduly delayed in seeking relief and that the addition of parties and claims would unduly prejudice Defendants by altering the scope of the litigation.
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NC Moulding Acquisition, LLC v. Smith, 2026 NCBC Order 40 (N.C. Super. Ct. Apr. 16, 2026) (Robinson, C.J.)
Key Terms: order on designation; N.C.G.S. § 7A-45.4(a)(1); declaratory judgment; limited liability company; operating agreement; contract law principles
This matter arises from a dispute between members of a limited liability company and seeks a declaration of the members’ respective interests in the company based on the terms of the operating agreement. Plaintiffs sought designation pursuant to N.C.G.S. § 7A-45.4(a)(1), but the Court concluded that the matter did not implicate the law governing limited liability companies and only required the application of contract law principles. The Court determined that the matter would not proceed as a mandatory complex business case.
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