Chicago Business Litigation Lawyer Blog
A plaintiff seeking to recover on a breach of fiduciary duty claim against a business partner must be able to show more than just evidence of his partner’s bad conduct, but must also demonstrate that he suffered measurable damages as a result of the conduct.
For almost a decade, JAP, Inc. and Today’s Sushi Corp. jointly owned and operated trendy Chicago eatery Sushi Wabi, cashing in on the burgeoning national sushi craze. In 1998, Angelo G., owner of JAP, and Angela L. and Susan T., owners of Today’s Sushi, entered a limited partnership agreement to open the Randolph Street restaurant, with each entity owning about half of the enterprise. The venture capitalized on Angela and Susan’s experience operating sushi restaurants, with JAP providing most of the investment funds. The partnership agreement gave each partner full power of management and control of the operation of the business by unanimous consent. Angelo’s brother Franco was made manager of Sushi Wabi and put in charge of daily decision-making, with Angelo to be consulted on “major” decisions. Things soured when Angela and Susan attempted to remove Franco as manager. JAP brought breach of fiduciary duty and conversion claims against the pair, and filed for an accounting and dissolution of the partnership. In its complaint, JAP alleged 19 separate bases for breach of fiduciary duty and demanded consequential and punitive damages. Continue reading ›