June had many developments both on the legal front and in our firm. First, you may have noticed that our title banner at the top of the newsletter has a new name: Fleming! We're proud to announce that our partner
has been added to our firm name - congrats, Gavin!
Next, several June decisions of the Michigan Court of Appeals highlight this newsletter. We cover a Michigan family dispute caused by the lack of a will, a $5 million judgment in a non-compete case and a decision affecting "finders" under the Uniform Securities Act.
Last, the upcoming Jake and Johnny Golf Outing and the effect of social media on hiring decisions is covered below. We hope you're enjoying the summer!
HUBBARD SNITCHLER PARZIANELLO & FLEMING PLC
No Will = Another Estate Battle Between Deceased's Sisters and Stepchildren
A June 9, 2015, decision of the Michigan Court of Appeals highlighted the importance of estate planning to avoid interfamily disputes.
In the case of In re Cliffman, John Cliffman died in a 2012 auto accident and his estate settled a wrongful death action for $300,000.00. John had no kids of his own and no will. He had two sisters and two stepsons from his wife who died in 1996. Naturally, Cliffman's sisters and stepsons disagreed as to who should take from the settlement proceeds. The Court of Appeals held that because Cliffman had no will and his wife pre-deceased him, the stepsons had no right to share in any portion of the wrongful death settlement.
Mark Snitchler not only drafts estate plans but represents those who have been wrongly denied interests in the estate plans of others
. Contact him with questions on estate planning matters.
Five-Year Non-Compete and $2M Judgment Against Detroit Restaurateur Affirmed
How long is a reasonable duration for a non-compete agreement? In the case of long-time area restaurateur Matt Prentice, five years was reasonable.
In 2009, Prentice faced foreclosure of his restaurant assets and sought financial assistance. Stanley Dickson agreed to purchase the assets and employ Prentice. Prentice signed a non-compete agreement which prevented him from competing with Dickson for five years after Prentice's employment ceased. In 2012, Prentice resigned, took key employees from Dickson and began operating in direct competition.
An Oakland County judge awarded Dickson $2 million in damages and required Prentice to abide by the non-compete agreement.
On June 23, 2015, the Michigan Court of Appeals agreed that Prentice "blatantly and repeatedly breached" the agreement. It affirmed the judgment and found that the five-year term was reasonable since Prentice's involvement was critical to the success of the business.
Non-compete agreements are enforceable when reasonable in geographic scope and duration. Contact
Jake & Johnny Golf Outing - September 21!
Congratulations to John Hubbard who was recently elected to the Board of Directors of the Metro Detroit / SE Michigan Chapter of JDRF, the leading global organization funding type 1 diabetes research! As you may know, John is also actively involved with
The Jake & Johnny Club
which is committed to raising moneyeading global organization funding type 1 diabetes research.
To date, over $120,000.00 has been directly contributed to try find cures for these diseases.
Its annual golf outing will be held on Monday, September 21st at the Golden Fox Golf Club in Plymouth. If you haven't played in it, consider joining us for what is always a great event! Early Bird discount pricing deadline is August 24: a foursome can register for $450; individual golfers can register for $125. Sponsorships are also available and greatly appreciated. More information can be found at this registration link. We hope to see you there!
Finders Need Not Be Registered As a Broker-Dealer or Investment Advisor
The issue of whether "finders" for investment purposes are required to be registered under the Uniform Securities Act was recently at issue in the Michigan Court of Appeals.
In Pransky v. Falcon Group Inc., the validity of a consulting agreement for the development of a spa was at issue. The plaintiff entered into a contract with Falcon Group which stated it was in the business of providing advice and consultation. In reality, the agreement primarily involved compensating Falcon Group for its efforts to find investments or financing for plaintiff's spa. The plaintiff paid Falcon a non-refundable fee then sued to get it back alleging that Falcon was required to register as a broker-dealer, agent, or investment advisor under the Uniform Securities Act. The Court of Appeals found that Falcon's "finder" obligations could be performed under the specific terms of its consulting agreement without being registered under the Act. We will monitor whether the Michigan Supreme Court reviews this decision.
John Hubbard litigates and arbitrates financial disputes with an emphasis on securities law advocating the rights of individual investors and groups of investors, often on a contingent fee basis. Contact him with any securities issues.
The Dangers of Social Media in the Hiring Process: Tips for Employers and Employees
Did you hear the one about the teenager fired for a tweet about her new job - even before she started? Yes - that happened in Texas this year when a pizzeria employee posted an uncomplimentary
tweet about the job she was about to start. The store owner saw her tweet and fired her before she started.
Employers regularly check the social media accounts of job applicants. This can cause issues for employers who may be violating the law through illegal discrimination and for employees who may not be considered for the job.
Employer tips: have a written policy about what you're reviewing and keep records of legal factors which disqualified a candidate. Employee tips: keep your personal social media accounts private and exercise discretion in your posts. For more, check out a blog on the topic at
Pre-Hiring Social Media Screening: 3 Tips for Employers and Applicants
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