Facts

Logtale Ltd. was an investment holding company and majority shareholder in Ikor Inc. Logtale sued Ikor Inc., Dr. Chairman and CEO James Canton and President and director Dr. Ross W. Tye for alleged unauthorized transactions and actions.

IKOR filed a counter-claim.

PLAINTIFF'S CONTENTIONS:
Plaintiff contended that it invested in IKOR, who held patents relating to the business of developing bovine-derived oxygen therapeutics and related technologies. It claimed that IKOR failed to provide it with financial documents and other information required by the parties' written contracts. It further contended that IKOR did not seek its approval before three of IKOR's directors conducted business with various companies in conflict with IKOR and engaged in related-party transactions.

Additionally, IKOR allegedly hid material facts about its business and products from Logtale and tried to engage in an unauthorized proposed reverse mortgage of IKOR with Scenic City, a shell corporation. IKOR also improperly removed plaintiff's designated representative from the IKOR board of directors so that IKOR and its principals could engage in these forbidden transactions.

Plaintiff asserted causes of action for injunctive relief, breach of contract, breach of fiduciary duties and breach of the implied covenant of good faith and fair dealing.

DEFENDANTS' CONTENTIONS:
Defendants denied wrongdoing and asserted various affirmative defenses. Ikor filed a counterclaim asserting claims for breach of licensing and manufacturing agreement, theft of intellectual property, interference with prospective business opportunity. IKOR also brought a third party complaint.

Result

The jury returned a verdict for plaintiff Logtale, determining that IKOR, Canton and Tye each owed Logtale $666,667 for breach of contract. It also found that IKOR breached the implied covenant of good faith and fair dealing and owed Logtale $666,667 for that breach. The jury found that Canton and Tye breached their fiduciary duties and were liable for $666,667 each in compensatory damages. The jury further awarded $750,000 in punitive damages as against Canton and $250,000 as against Tye, for a total award of $5,000,000. Ikor's counter-claims were all dismissed with prejudice before trial.

Other Information

FILING DATE: Nov. 9, 2011.