Lead counsel representing Kentucky Derby winning jockey in dispute with his agent over breeding rights
Lead counsel in defending claims in federal court against Kentucky Derby winning jockey regarding claims by agent for portion of yearly stud fee from the stallion, Unbridled’s Song. After briefing and argument, case was dismissed by District Court. On appeal by opposing party, after briefing and argument, U.S. Court of Appeals for 6th Circuit affirmed in all respects. Adika v. Smith, 466 F.3d 503 (6th Cir. 2006).
Successful Defense of Veil-Piercing Claim
Spradlin v. Beads & Steeds Inns, LLC (In re Howland), 2017 WL 24750; 2017 U.S. App. LEXIS 222, 2017 WL 24750 (6th Cir. 2017) – Adam Back successfully briefed and argued on behalf of the Appellee before the Sixth Circuit Court of Appeals. The resulting opinion affirmed judgment on the pleadings in favor of his client and an order denying the trustee’s motion to amend her complaint to include a substantive consolidation claim. Adam argued that reverse veil piercing could not be utilized by a Chapter 7 trustee to permit fraudulent conveyance claims under the Bankruptcy Code and Kentucky law based on a transfer made by an entity wholly owned by the debtors. He also maintained that the trustee could not rely on substantive consolidation to merge the assets and liabilities of the debtors and their wholly owned, non-debtor entity. The Sixth Circuit affirmed both bankruptcy court decisions—516 B.R. 163 (Bankr. E.D. Ky. 2014) and 518 B.R. 408 (Bankr. E.D. Ky. 2014)—which were also affirmed by the district court—2016 WL 3176649; 2016 U.S. Dist. LEXIS 74830 (E.D. Ky. 2016).
Southern Indust., LLC v. Maxine, LLC
Southern Indust., LLC v. Maxine, LLC, 2009 Ky. App. Unpub. LEXIS 996 (Ky. Ct. App. Nov. 25, 2009). Successfully argued for affirmation of order finding that a mechanics lien on commercial landlord’s property for work done on tenant’s behalf was not enforceable.
Successful Defense of Veil-Piercing Claim
Spradlin v. Beads and Steeds Inn, LLC (In re Howland), Case No. 16-5499 (Jan., 2017) (unpublished)
The Sixth Circuit Court of Appeals upheld the lower court rulings SKO obtained in a matter involving novel Kentucky corporate law claims centered on reverse veil piercing and substantive consolidation claims under bankruptcy law. SKO successfully defended the client against efforts by a Chapter 7 trustee to avoid the transfer of a parcel of real property. In this case, the client purchased a farm from an LLC, which leased it back to continue operating its business at the location. When the individual members of the LLC later sought bankruptcy relief, the trustee filed a complaint, alleging the client was the recipient of a fraudulent transfer. SKO proved the property transfer was made to our client by the LLC, not the individual debtors. Efforts by the trustee to amend and consolidate the complaint on appeal, as well as invoke reverse veil-piercing, were unsuccessful in federal Bankruptcy Court, the U.S. District Court for the Eastern District of Kentucky and the Sixth Circuit Court of Appeals.
Lead Trial Counsel Defending Top 10 NCAA Division One Football Coach and the University’s Athletic Association
The Coach and Athletic Association were sued by a former student-athlete who alleged improprieties in the granting of football scholarships. A decision against the Athletic Association and the Coach would have affected recruiting of college athletes at every level. Trial in this matter lasted two weeks with well-known experts from various college football programs testifying for each side. The jury returned a unanimous defense verdict on all counts and awarded no damages.
Rights of Nonprofit Members to Inspect Corporate Records
SKO represented certain members of a Kentucky nonprofit equine corporation in litigation against the nonprofit. When “significant deficiencies” were identified in the nonprofit’s $2 million annual budget, the organization refused to produce accounting records to the members who requested them. SKO obtained a summary judgment on behalf of its clients and defeated nonprofit’s motion for a stay of the judgment pending appeal. SKO also established that the nonprofit destroyed records, computer hard drives and backup servers during the pendency of the litigation. The Fayette Circuit Court held the nonprofit in contempt and ordered it to pay SKO’s fees. The nonprofit sought relief in the Kentucky Court of Appeals. Following the conclusion of the briefing by both parties, the nonprofit agreed to dismiss its appeals and to comply with the judgments entered in the Fayette Circuit Court action. This was a case of first impression in Kentucky. The Court held that, under Kentucky law, all Kentucky nonprofit corporations must allow their members to inspect and copy all of the corporation’s books and records.
Breach of Contract
SKO represented an insurance company that was being sued in the U.S. District Court for the Western District of Kentucky by a paper products manufacturer for breach of an insurance contract. The manufacturer alleged that it had proven a covered loss under an employee theft policy and the insurer disagreed and denied many elements of the claim. At the trial court level, the manufacturer willfully violated multiple discovery orders and the court dismissed the manufacturer’s claims as a sanction. After the dismissal, the trial court denied the insurer’s motion for fees incurred litigating the dispute. The manufacturer appealed the trial court’s denial to the Sixth Circuit and the insurer cross-appealed the denial of fees. After briefing on the first appeal had concluded, the parties resolved all matters amicably. While the case did not result in an appellate decision, SKO was successful in preserving an important district court opinion levying a rare dismissal sanction for discovery misconduct.
SKO represented a university that terminated one of its police officers after two episodes of misconduct that were detected through intradepartmental procedures. The employee appealed the termination through an internal appeal process, which concluded in a four-day de novo hearing before a neutral Hearing Officer from the Kentucky Attorney General’s office. The internal appeal was unsuccessful, and the employee appealed to Jefferson Circuit Court, arguing that the Hearing Officer’s recommendations were arbitrary and capricious and that the employee had been deprived of the procedural protections found within KRS 15.520, aka the Police Officer’s Bill of Rights. In response, the university explained that the Hearing Officer’s recommendations were well supported, that KRS 15.520 was only applicable when officer discipline was premised on a citizen complaint (and thus not applicable in an intradepartmental matter), and that even if the procedural protections of KRS 15.520 applied, any prejudice was cured through the four-day de novo hearing that the employee had been afforded internally. After the Circuit Court agreed with the university’s points and upheld the Hearing Officer, the employee appealed to the Kentucky Court of Appeals, where the same arguments were made. The Court of Appeals issued a 31-page opinion affirming the trial court on all points. The employee filed a motion for discretionary review which is currently pending. The case is a very meaningful one in the law enforcement community, particularly among non-unionized officers. Also, in reaching its decision, the Court of Appeals ruled as a matter of first impression that the university’s internal pre-hearing processes were constitutional.
Violations of Agreements and Restrictive Covenants
SKO represented a provider of specialty patient care equipment that sued a consultant and its consulting business after an agreed upon Asset Purchase Agreement and Consulting Agreement’s restrictive covenants had been violated by the consultant. The provider sued for both monetary damages and injunctive relief. The Jefferson Circuit Court granted the provider’s motion for a temporary injunction against the consultant under the Consulting Agreement, but denied the motion for a temporary injunction against the consultant under the Asset Purchase Agreement. Because the Asset Purchase Agreement provided greater injunctive protection, the provider filed an interlocutory appeal pursuant to CR 65.07. The Kentucky Court of Appeals agreed with the provider that the Jefferson Circuit Court had erred in denying injunctive relief under the Asset Purchase Agreement, and reversed the Jefferson Circuit Court’s decision on that issue. This was a notable decision because the standard of review for a party seeking interlocutory relief from a trial court’s decision to grant or deny a temporary injunction is a clear abuse of discretion.
Workers’ Compensation Retaliation
SKO represented a manufacturer and distributor of auto supplies that was sued for workers’ compensation retaliation under the Kentucky Workers’ Compensation Act, KRS Chapter 342. The United States District Court for the Western District of Kentucky entered summary judgment in favor of the manufacturer, from which the plaintiff did not appeal.