Facts

Plaintiff James Grimm was hired as a senior consultant with Thomas Finnerty's company, Innovative Cost Management Service Inc. In 1998, Finnerty met with plaintiff, and the future possibility of plaintiff obtaining a percentage ownership in the company was discussed. Six years later, plaintiff went on disability. He sent Finnerty a letter demanding back commissions and a certificate that indicated his 25 percent ownership of the company, pursuant to the 1998 agreement. Finnerty denied that plaintiff had an ownership claim to the company. Plaintiff filed suit for breach of contract against Finnerty, his wife Joanne Finnerty, and Innovative Cost Management Service Inc.

PLAINTIFF'S CONTENTIONS:
Plaintiff claimed that the parties had entered into a binding contract at the 1998 meeting. He contended that it was understood among the parties that he would be made a 25 percent partner in the company, based on the sweat equity he was expected to invest in helping build the fledgling company. Plaintiff argued that Thomas Finnerty had said the company intended that plaintiff acquire a five percent interest in the company for each year he worked. He asserted that he was entitled to interest in the company, and was due back commissions for $160,000.

DEFENDANTS' CONTENTIONS:
Defendants claimed that the 1998 contract was never finalized. The agreement noted that the parties intended for plaintiff to assume an ownership share in the company, however, defendants emphasized that it stated that the details still were not settled. Thomas Finnerty agreed that discussion had taken place regarding plaintiff becoming a partial owner of the company at the 1998 meeting. Defendants argued that the discussion had involved plaintiff purchasing a portion of the company, not a sweat equity agreement. Defendants also pointed out that plaintiff's employment contract did not address any specific terms for plaintiff's ownership share, plaintiff's tax returns did not indicate an ownership interest in the company, and no paperwork or stock certificates were ever issued to plaintiff, to substantiate their claim that plaintiff had not been given an ownership share. Finally, defendants presented evidence that in 2003, Thomas Finnerty had considered selling the business, and that during the extensive negotiations with a potential buyer, plaintiff was never identified as a partial owner of the company.

Damages

Plaintiff sought $160,000 in past commissions and 25 percent ownership of Innovative Cost Management Services Inc.

Result

The jury found that defendants were not in breach on the 1998 agreement, and that plaintiff was not entitled to an ownership share in the company.

Other Information

Defendants conceded that they owed plaintiff $58,000 in back commissions. At mediation, the parties agreed that Innovative Cost Management Services Inc. would pay plaintiff $100,000 in past commissions, and only the ownership dispute was litigated at trial.

Deliberation

two hours

Poll

9-3

Length

one week