Monday, January 17, 2011

Business Conspiracy and Employee's Fiduciary Duties

FACTS: Feddeman & Co offered a group of its employees the opportunity to buy out the main stockholder, creating an employee-owned corporation. During the negotiations, the buy-out began to seem unattainable to the employees, so these employees and directors of Feddeman met with a competitor (Langan Associates). The employees discussed the possibility of employment with Langan Associates, and used the threat of resignation as a leverage.

Feddeman then sued Langan and Feddeman's former employees for conspiring to ruin Feddeman's business, usurpation of Feddeman's business opportunities and breach of fiduciary duties.

In order to legally leave Feddeman the employees followed the advice of an attorney, who was also Langan's lawyer.

JURY RULING: An Alexandria Circuit Court jury awarded 3.3 million dollars to Feddeman.

COURT RULING: The judge set aside the 3.3 million dollar verdict in part because the "employee Defendants scrupulously adhered to the advise of counsel as to how to prepare to leave". The case has been appealed to the Supreme Court of Virginia.

SUPREME COURT RULING: The Virginia Supreme Court found that there was not basis to set aside the verdict because defendant employees and defendant directors did more than merely prepare to resign and advise others of a plan to leave. Credible evidence supported the jury determination that the conduct fell below the required standard of good faith and loyalty, and was sufficient to constituted a breach of fiduciary duty. The Court reinstated the 3.3 million dollar verdict.

ACTION ADVISE: When making an important business decision, hire a lawyer that does not have a conflict-of-interest. Conspiring against an employer with a competitor may be considered a breach of good faith and loyalty, as well as a breach of fiduciary duty.


The above article is not meant to replace legal counsel. If you'd like to meet with one of our lawyers, please call 703-273-1400 or fill out our online Information Request form.

Friday, January 14, 2011


On January 13, 2011, the Virginia Supreme Court handed down two opinions that should prove to be of immense benefit to criminal defense lawyers.

In the first opinion, Roseborough v. Commonwealth, Record No. 100507, the Virginia Supreme Court held that the Virginia Implied Consent law is implicated in all circumstances where a defendant accused of drunk driving is asked to submit to a breath test. In this case, the Supreme Court found that the trial court erred in admitting into evidence a Certificate of Analysis because the officer had made an invalid warrantless arrest. Consequently, the logic of the holding will allow criminal defense lawyers to argue that the statutory requirements of the implied consent law must be strictly followed, or the results of the breath test will be inadmissible in Court.

In the second opinion, Hernandez v. Commonwealth, Record No. 092524, the Virginia Supreme Court held that a Circuit Court judge has the inherent authority to enter a deferred disposition for any type of case. In its holding, the Supreme Court determined that the act of entering judgment is more than a ministerial act and therefore the Court determined that judges are not obligated to enter a judgment of guilt even if the evidence supports a finding of guilt. This case will open the door for defense attorneys in appropriate cases to seek probation, community services and alternative ways of addressing the problem without the need for entry of a criminal conviction on their client’s record.

Collectively, these opinions provide new legal authority for savvy criminal defense lawyers to help defend and assist their clients.

Thursday, January 13, 2011


Gross & Romanick has an extensive and substantial history in the practice area of debt collections. (We've even started a new blog that you may want to read--Legal Collection Blog. For many years the Law Firm handled a large volume of collection matters. During that period the firm represented creditors in thousands of cases, working with numerous collection agencies, other collection law firms, forwarding lists and large companies. The Law Firm was a member of the Commercial Law League of America, the leading organization of collections, creditors' rights and bankruptcy professionals. In addition, Edward Gross, the managing partner, developed a collection software program (GoldSoft) that was sold to and is still used by many collection law firms across the United States.

In 2000, the law firm purposely chose to change focus from a volume collection practice to concentrate on larger dollar value collection matters. The lawyers at Gross & Romanick routinely apply the knowledge gained from collecting so many debts in their past to assist its current clients who are generally owed a substantial amount of money. Gross & Romanick continues to utilize the latest technological advances in its collection practice. The Law Firm has access to huge databases and extensive online research tools.

Collection of judgments requires creativity and persistence. Businesses that owe money to our client must either pay or go out of business. Here are just a few of the collection techniques used by us in our practice:


Our firm has the internal ability to investigate the debtor and the likelihood of collection. In some cases we use private investigative services, locator services and other outside professionals to locate the debtor and the debtor's assets.

Demands & Settlements
In many cases a lawsuit can be avoided by an aggressive demand letter. If the debtor is willing to make and the client is willing to accept a payment schedule, we structure settlement agreements to assure, as much as possible, payment of the debt. Often, we utilize confession of judgment notes, consent orders, UCC-1 Financing Statements, Deeds of Trust and other security to back up the promise to pay.

It is important to sue all of the parties who may be liable for the debt, including tradenames and guarantors, in a manner that improves the likelihood of collection after the judgment. While many law firms simply sue the obvious parties responsible for the debt and do not consider the ultimate collection of the judgment, our firm performs a thorough review of the documents, facts and parties before filing the lawsuit. When it can be done in "good faith", we include fraud, conversion and other causes of action that may prevent a judgment from being discharged in bankruptcy.

Prejudgment Attachments
In some circumstances the court may authorize the seizure of property and bank accounts of the debtor even before suit is filed. Obtaining a prejudgment attachment is very technical and requires a firm with a great deal of experience to succeed.

Garnishments & Seizures
The seizure of bank accounts, debts owed to the judgment debtor, personal property and other intangible property is a favored collection procedure. Finding the property, serving the proper parties and filing the proper paperwork takes a tremendous amount of experience and aggressive effort. The judgment debtor must be made to understand that non-payment will result in disturbance to its business and personal finances.

Debtor's Interrogatories
The judgment creditor is entitled to question the debtor about the location of its assets. We generally conduct debtor's interrogatories before a commissioner or a judge, and have a court reporter transcribe the debtor's testimony. This procedure discourages perjured testimony and aids in understanding the potential location of all assets. If a debtor is personally served with the Summons ordering attendance at Debtor Interrogatories hearing and fails to show, our Law Firm routinely requests that the debtor be arrested for disobeying the Court Order and only released upon the posting of a bond.

Fraudulent Conveyances

In some cases a debtor may transfer assets to a third party or other entity in order avoid payment of the debt. We have filed many legal actions to pierce corporations and to pursue the third parties to whom the assets were transferred.


Bankruptcy does not necessarily end our pursuit of the debt or the judgment. We have successfully collected money from many debtors who filed bankruptcy. It some cases we have objected to discharge based upon fraud, conversion or other allowable objections to discharge under bankruptcy law.

For more information or to speak to one of our lawyers today, please contact Gross & Romanick by calling 703-273-1400 or filling out our online Information Request form.