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Corporations Keyed to Hazen
McLaughlin v. Schenk
Citation:
220 P.3d 146 (Utah 2009)Facts
On August 4, 2002, Harold Rosemann, board member and chief financial officer for Cookietree, instructed Kim McLaughlin, McLaughlin’s wife, to tell McLaughlin to withdraw his claims or there’s going to be some organizational changes around here. As a shareholder, McLaughlin made a request for information regarding the Schenk stock transasction. That same day Greg Schenk confronted McLaughlin and fired him. His notice of termination indicated that it was without cause. Pursuant to McLaughlin’s employment agreement, the termination date was not effective for six months. When McLaughlin refused to leave, police escorted him from the property. Following his termination McLaughlin continued to receive dividends from his Cookietree holdings. This income comprised half of their family’s income. In November 2004, McLaughlin sued Cookietree and Greg Schenk for breach of contract and breach of fiduciary duty based on Greg Schenk’s stock acquisition. McLaughlin asks this court to determine whether Cookietree shareholders owed McLaughlin fiduciary duties and if so whether any such duty was violated.
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