Kelly-Springfield Tire Co. v. Continental General Tire
Published: Aug. 16, 2001 | Result Date: Jun. 14, 2001 | Filing Date: Jan. 1, 1900 |Case number: BC209863 Bench Decision – $0
Judge
Court
L.A. Superior Central
Attorneys
Plaintiff
Louis E. Kempinsky
(Kempinsky Law Ltd.)
Defendant
Experts
Defendant
Troy A. Dahlberg
(technical)
Facts
Plaintiff Kelly-Springfield Tire Co. and defendant Continental General Tire both supplied tires to RPJ Company
dba Parnelli Tires, Inc. and DobÆs Tire Stores, which had more than 80 stores in California, Nevada, Kansas,
Oklahoma, New Mexico and Texas. Defendant Continental invested $5 million in RPJ and advanced $13
million in credit. Eventually, defendant Continental owned 71 percent of the stock of RPJ.
Plaintiff Kelly-Springfield had advanced $3.8 million to RPJ. After losing money for several years, RPJ
decided to wind up its business and sold its stores. Neither Continental nor Kelly were paid in full.
Plaintiff Kelly alleged that defendant Continental, as the controlling shareholder of RPJ, owed a fiduciary duty
to Kelly and that it breached that duty by preferring itself over Kelly during the windup of RPJ.
Defendant Continental denied any wrongdoing and pointed out that plaintiff Kelly was paid a much greater
percentage of its receivable than was Continental.
Settlement Discussions
The plaintiff demanded $1.5 million, while the defendant made no offer.
Damages
The plaintiff sought lost debt and prospective economic advantage damages.
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