Lipson Neilson Enjoys Hard Fought Victory: Federal Court Dismisses Multi-Million Dollar Trade Secret Claim Against Altair Engineering, Inc. and Key Employee

The Lipson Neilson team of Phillip E. Seltzer, C. Thomas Ludden and Samantha K. Heraud celebrated a long-sought victory in a case originally filed against their clients in 2007. After a 2014 adverse trial verdict was vacated by the trial judge, a new trial was ordered.

However, on December 13, 2017, Judge Avern Cohn granted a summary judgment motion to Defendants, Altair Engineering Inc. and a key software director, dismissing the claims brought by MSC.Software (“MSC”) for trade secret misappropriation. In his final decision, Judge Cohn found, “MSC has no admissible evidence to support its claim for damages,” and noted, “MSC concedes that its multimillion dollar damage claim is unsupported in light of the exclusion of [MSC’s expert’s] testimony and it does not challenge Altair’s reasoning.” The Judge’s decision finished with a reference to the famous T.S. Eliot poem The Hollow Men: “This is the way the world ends; Not with a bang but a whimper.”

MSC initiated the case in 2007 when it sued Altair and a number of former employees of MSC. MSC asserted sixty-three claims of misappropriation of trade secrets by Altair and its employees, along with a breach of confidentiality and non-solicitation agreements by the key employees.

With a team of lawyers at Lipson Neilson leading the charge, the Court summarily dismissed 58 trade secret misappropriation claims out of the original 63 alleged in pre-trial proceedings. In April 2014, after a two-month trial, a jury determined that three out of the remaining five trade secrets were misappropriated. The Jury awarded MSC $26.5 million in damages out of the 62 Million plus damages sought at trial.

However, on a motion to vacate that judgment brought by Lipson Neilson (working with the Boston law firm of Fish & Richardson), Judge Cohn vacated the jury award for the trade secret violations (over 26 Million) in November 2014. The opinion noted, among other things, the misconduct of MSC’s trial counsel in abusing his right to rebuttal closing argument by raising a damage theory previously barred by a prior pre-trial ruling. Finding that the argument impermissibly skewed the damage horizon in the case, the Judge ordered a new trial regarding damages for the three trade secrets the jury determined were misappropriated. However, after further discovery and expert testimony, the Judge’s ruling of December 13, 2017, resulted in summarily dismissing MSC’s trade secret claims in their entirety against Altair and its key employee.

The law firm of Fish & Richardson, Boston, MA, represented Altair during the post-judgment/new trial phase, with Lipson Neilson representing the key employees.

Joseph Garin Co-Presents “Changes in Professional Liability Rules” at the Nevada State Bar’s 2017 Ethics Year in Review Program

Joseph Garin, Managing Partner of the Las Vegas office of Lipson, Neilson, Cole, Seltzer, Garin, P.C., co-presented, along with attorney Alan Freer, “Changes in Professional Liability Rules”, during the Standing Committee on Ethics and Professional Responsibility of the State Bar of Nevada’s 2017 Ethics Year in Review program, held on November 7, 2017, at the Northern Nevada Bar Center in Reno.

This event focused on some of the most important issues facing lawyers in the practice of law today. The program featured interactive discussions covering issues that are all too familiar and those that are not as readily apparent.

Joseph Garin is consulted nationally on the defense of professional liability claims, ethics, employment, insurance coverage disputes, director and officer claims, and risk management. Mr. Garin is former Chair and current member of the Standing Committee on Ethics and Professional Responsibility to the Nevada State Bar; and he is a member of the Professional Liability Advisory Board for the national Claims & Litigation Management Alliance. Comprised of industry leaders from across the United States, this Board guides the development of extensive professional liability resources.

Founded in 1985, Lipson, Neilson, Cole, Seltzer, Garin, P.C. has offices in Nevada, Arizona and Michigan. The firm is widely known for its excellence in professional liability law, offering invaluable insight and experience to its clients across all industries. The firm represents clients in Nevada, across the USA, and around the world.

Contact: Joseph Garin
Phone: 702-382-1500
Email: JGarin@lipsonneilson.com

Attorneys Phillip E. Seltzer and Shawn Grinnen Successfully Obtain Substantially More Than the Appraised Fair-Market Value for Their Client’s LLC’s Membership Interest in an Oppression/Conversion Lawsuit

Phil and Shawn PhotoIn a LLC membership dispute case concerning breach of fiduciary duties, membership oppression, conversion, and aiding and abetting conversion of their client’s membership interest, Attorneys Phillip E. Seltzer and Shawn Grinnen successfully obtained, via settlement, substantially more than the appraised fair-market value of their client’s membership interest in the LLC.

As part of the settlement, the client received $515,000:

  • $320,000 representing the appraised fair-market value of the client’s membership interest.
  • Plus an additional $195,000 representing a compromise on the remaining damage claims against the controlling LLC member and certain other individuals who allegedly aided and abetted the wrongful conduct of the controlling members.

Based on the evidence developed in discovery, the Lipson, Neilson team argued that the Client’s LCC membership interest had essentially been converted. The nature, character and misconduct of the controlling members tortious conduct had essentially denied all meaningful rights in the LCC by the Client – rights that are specifically deemed “personal property” under the LCC Act. Under Michigan law, only personal property (as opposed to intangible business interests) can be the subject of a conversion claim.

By creatively arguing that their client’s LLC membership interest had been wrongfully converted, attorneys Seltzer and Grinnen convincingly demonstrated that the controlling members and those that allegedly aided and abetted it had a strong likelihood of being found liable for not only paying the $320,000 value for the membership interest, but also the potential for treble damages under Michigan’s conversion statute – a statute that also allows for recoupment of attorney fees “in addition to any other right or remedy the person may have at law or otherwise.”

With Summary Disposition motions pending and fearing the Court was about to find the controlling members and the other individual defendants liable for $320,000 in damages plus potential trebling and attorney fees, the defendants agreed to settle for $515,000 in exchange for a final dismissal of the case. The creative use of the conversion statute immeasurably made the case stronger for the client, who was overwhelmingly satisfied for obtaining a resolution that was well in excess of the appraised fair-market value of his membership interest in the LLC Company.

Phillip E. Seltzer: pseltzer@lipsonneilson.com

Shawn Grinnen: sgrinnen@lipsonneilson.com

Summary Dismissal Victory by C. Thomas Ludden and Samantha Heraud

Samantha Kaplan Heraud

Samantha Heraud

C. Thomas Ludden

C. Thomas Ludden

As their initial response to the Complaint, Lipson Neilson challenged whether a defendant had been served with the summons and complaint before the summons expired. After reviewing the parties’ briefs, the Wayne Circuit Court held an evidentiary hearing regarding whether the process server had delivered the summons and complaint to the defendant. Upon completion of the evidentiary hearing, the Wayne Circuit Court granted the motion and dismissed all claims against the defendant.

Victory Upheld in Defense of Lawyer for Phillip E. Seltzer, C. Thomas Ludden and Samantha Heraud

By order dated April 4, 2017, the Michigan Supreme Court recently ruled to let stand a prior victory achieved in the Michigan Court of Appeals in the matter of Boladian et al v. Thennisch, et al, Unpublished Mich. Ct. of App., issued April 12, 2016 (Docket #No. 324737). In Boladian¸ a lawyer was sued for, among other things, malicious prosecution, abuse of process and defamation, arising from the failed prosecution of civil matters against a music publishing company and its owner. The Lispon Neilson legal team of Phillip E. Seltzer, C. Thomas Ludden, and Samantha Heraud, obtained summary dismissal of the referenced claims in the trial court and defended that result on ensuing appeals.

The Boladian Court of Appeals panel affirmed the trial court’s rulings. Boladian is the first Michigan case to reject a multiplicity of legal proceedings as constituting a “special injury” — a necessary requirement to prove a malicious prosecution claim. Noting Michigan’s “special injury” requirement, the Court of Appeals refused to expand the notion of “special injury” beyond the English common law rule – previously adopted in Michigan — which does not include defending multiple legal proceedings (or, in this case, multiple post judgment motions that sought relief from various settlements in different civil lawsuits involving plaintiffs).

Furthermore, the Court of Appeals affirmed summary dismissal of the abuse of process claim against the attorney, determining that an alleged settlement demand for $1 million in exchange for a promise of not filing a damaging and supposedly defamatory affidavit, failed to demonstrate the required ulterior or collateral purpose necessary to sustain the tort. Demanding settlement is not collateral to maintaining a lawsuit, especially one that seeks monetary damages. Further, no showing was made that the demand was beyond the realm of potential damages in the underlying case.

The Boladian Court also rejected the argument that there was an “ulterior motive” based on the desire of the lawyers to “drum up business” by leaking an alleged defamatory story about Plaintiffs’ business practices to the media, finding that this was either a part of a time barred defamation claim that had previously been dismissed and, further, because supplying information to the media is “action outside legal proceedings” and not applicable to an abuse of process claim.

To learn more about this case, please contact Phillip E. Seltzer at 248-593-5000.

Medicare Starter Kit

8 Does and Don’t of signing up for Medicare:

  1. Do give yourself time to learn about Medicare:
  2. Don’t expect to be notified when it’s time to sign up:
  3. Do enroll when you’re supposed to:
  4. Don’t despair if you haven’t worked long enough to qualify:
  5. Don’t worry that poor health will affect your coverage:
  6. Do remember that Medicare is not free:
  7. Don’t assume that Medicare covers everything:
  8. Don’t expect Medicare to cover your dependents:

CEP-Logo2

The Center for Estate Planning is a leader in Michigan for many areas of estate planning, from estate administration to lifetime counsel and probate administration work. We focus on individuals and closely-held businesses and charitable organizations, working closely with our clients to provide top level advice.

Since Lipson Neilson acquired the the Center for Estate Planning, the firm has greatly enhanced its depth of expertise and practice disciplines. To learn more please visit www.CEPlawyers.com

Sandra Glazier Selected to Speak at the 29th Annual Spring Symposia for the American Bar Association’s Section of Real Property, Trust and Estate Law

SG001_SQ_eLipson Neilson Shareholder Sandra Glazier has been selected by the American Bar Association (ABA) to co-present “Disputes Over Estate or Trust Administration” during the community outreach program of the 29th Annual Spring Symposia for the Section of Real Property, Trust and Estate Law. This presentation will address disputes that arise during the course of administration of an estate or trust, including: accounting proceedings, breach of fiduciary duty/surcharge litigation, and removal of fiduciary proceedings. Ms. Glazier will co-present along with Laura Lattman, Principal of The Lattman Law Firm in New York City.

Ms. Glazier is one of only two Michigan attorneys selected by the ABA to present in the Estate Planning and Trust Administration portion of the Symposia that will be held in Denver, Colorado during April 19 – 21.

An attorney for more than 34 years, Ms. Glazier is known for her expertise and successful track record in probate litigation, estate planning, trust and estate administration, and family law matters.  The cases she works on tend to be very complex and require technical as well as legal expertise.  Ms. Glazier has represented contestants and proponents of estate planning documents, as well as fiduciaries, in significant trust litigation proceedings.  An AV-Rated attorney, she has also been recognized as a “Top Lawyer” by DBusiness, in the areas of probate, estate and family law.

Ms. Glazier has had numerous articles published by some of the legal industry’s leading publications. In addition, she has presented on estate planning and probate litigation related topics for the ABA, Notre Dame Tax and Estate Planning Institute, Kansas City Estate Planning Symposium, ICLE, the OCBA, Wilmington Trust’s New York Trust Symposium and the Bloomberg BNA Estate and Gift Tax Advisory Board.

Contact: Sandra Glazier
Phone: 248-593-5000
Email: sglazier@lipsonneilson.com

Dax Watson Presents “Branding Dos & Don’ts” at Keller Williams National Training Event

Dax Watson at Keller Williams in Las VegasDax Watson, Managing Partner of the firm’s Phoenix office, was featured on a panel of real estate industry experts at the Keller Williams “Family Reunion” national training conference. Moderated by Kathleen Manchin, the Corporate Counsel at Keller Williams Realty Inc., joining Dax on the panel were the Kathie Connelly, Executive Director of the Maryland Real Estate Commission and Gary Pickren, a real estate attorney from South Carolina. Real estate agents and brokers attended this discussion to learn how to build a brand that complies with their local laws and regulations.

Stacked with top speakers from across the country, and described on the Keller Williams website as “the real estate industry’s most powerful training event”, this conference was held on February 13-17, at the Mandalay Bay Convention Center in Las Vegas.

Dax Watson focuses his law practice in commercial litigation with an emphasis in real estate matters and professional liability defense. His clients include professionals in the fields of real estate, law, accounting, architecture, and engineering. Dax is also an experienced mediator that conducts private mediations and settlement conferences for all types of civil disputes, with a focus on real estate and commercial litigation disputes. He regularly appears and represents clients in regulatory matters before the Arizona Department of Real Estate and other state and federal agencies.

About Lipson Neilson
Founded in 1985, Lipson, Neilson, Cole, Seltzer, Garin, P.C. has offices in Arizona, Nevada, and Michigan. The firm is widely known for its excellence in the professional liability lines, offering invaluable insight and experience to its clients across all industries. You can learn more at www.lipsonneilson.com.

Contact: Dax Watson
Phone: 602-382-1500
Email: DWatson@lipsonneilson.com

Attorney Julie A. Funai Joins Lipson Neilson’s Las Vegas Office

Julie FunaiAttorney Julie A. Funai has joined the firm’s Las Vegas office as an associate. Ms. Funai has a wide range of experience in civil litigation, transactions, mediation and arbitration. She served as general counsel as well as with prestigious law firms in the Las Vegas area.

Ms. Funai received a B.S. in Business Administration with a specialization in Marketing from Marquette University in Milwaukee, Wisconsin, and a J.D. from St. Mary’s University, School of Law in San Antonio, Texas.

About Lipson Neilson
Founded in 1985, Lipson, Neilson, Cole, Seltzer, Garin, P.C. has offices in Las Vegas, Phoenix, and Bloomfield Hills. The firm is widely known for its excellence in the professional liability lines, offering invaluable insight and experience to its clients across all industries. The firm represents clients in Nevada, across the USA and around the world.

Contact: Joe Garin – Managing Partner of the Lipson Neilson Las Vegas office.
Phone: 702-382-1500
Email: JGarin@lipsonneilson.com

Karen A. Smyth Selected for Panel of Industry Professionals to Discuss the Rise in Compensation Discrimination Claims and the Impact on Employment Practices Liability Insurance

_DSC9496-8_0x10_0-03A-Q01Karen A. Smyth, a Partner at the firm, will be on a panel of legal and insurance industry professionals at the 25th Employment Practices Liability Insurance Forum. The theme of this panel discussion is, “Spotlight on Pay Equity: Examining the Rise in Compensation Discrimination Claims and the Impact on EPLI.”

Held on January 26-27, 2017 in New York City, this forum is stacked with top speakers from across the country; attendees include claims professionals, underwriters, risk managers, in-house counsel and outside counsel.

Topics to be discussed by Ms. Smyth and her co-panelists include:

  • The recent equal pay movement and an overview of the latest key legislative and regulatory developments that employers should familiarize themselves with to stay ahead of the curve.
  • The recent ramped up pay equity laws enacted in New York and California.
  • New pay equity rules issued for federal contractors.
  • Industries demonstrating the most dramatic wage gaps between men and women.
  • Evaluating exposure to claims of compensation discrimination and tips for equal pay compliance.
  • The latest claims arising from pay discrimination or “glass ceiling” failure to promote cases.
  • How new state laws are making it easier for employees to succeed on pay discrimination claims.

Ms. Smyth regularly provides counsel to clients in their efforts to develop, conduct or enforce compliance programs. These include customizing employee manuals, employment agreements, non-compete agreements, anti-harassment and anti-discrimination policies, internal investigations of reported harassment, discrimination, or retaliation and general HR policies.

Additionally, Ms. Smyth regularly keeps her clients abreast of evolving employment laws, regulations and ordinances governing protected classes and activities, and wage and hour issues. Ms. Smyth represents employers in a variety of claims, both at the administrative level (EEOC/MDCR) as well as civil complaints filed in state and federal courts.

On a national level, Ms. Smyth is routinely invited to participate as a panel speaker on employment law for various national organizations. She also provides internal training to employers, supervisors, and employees about various employment law topics. She is a licensed attorney in Michigan and New York, and admitted to practice in Michigan’s state trial and appellate courts, federal district courts, and Sixth Circuit Court of Appeals.

About Lipson Neilson
Lipson, Neilson, Cole, Seltzer & Garin, P.C. is an AV rated firm that recently celebrated its 31st anniversary. The firm has offices in Michigan, Nevada and Arizona. The firm is widely known for its employment defense and all other professional liability lines, offering invaluable insight and experience to its clients across all industries. It also provides litigation management services and represents insurers on coverage matters as a local representative. Lipson Neilson is committed to identifying and pursuing the most cost-effective options available for claim resolution. You can learn more at www.lipsonneilson.com.

Contact: Karen Smyth
Phone: 248-593-5000
Email: ksmyth@lipsonneilson.com