Professional Documents
Culture Documents
JOHN R. BAILEY
Nevada
BarNo. 0137
BAILEY.:. KENNEDY
8984 Spanish Ridge Avenue
Arbitrator
DISTRICT COURT
10
11
12
13
14
15
16
17
18
corporation, )
Dept. No. XI
ARITRATION AWARD
19
20
21
22
ease of reference, "Defendants") seek to modify/correct the Arbitration Award in the following
23
areas:
24
25
26
27 Plaintiffs/Counterdefendants timely fied an opposition to the Motion, and Defendants timely fied a Reply.
In Defendants' Reply, they ask this Arbitrator to take judicial notice of Plaintiffs/Couterdefendants' Motion to
28 Confirm Award fied with the Court on February 23, 2015, and their assertion that such motion contained false
representations. I leave it to the Court to address those concerns.
BAILEY.:.KENNEDY
562-8821 Page 1 of 6
1.
Milton Woods
4
3.
6
7
fiduciary duties.
While Defendants use the correct statutory citation for seeking relief to modify or correct
reviewing the substance of their Motion that much of the relief requested is not based on a need
10
11
12
spend much of their Motion arguing for a completely different outcome - one that favors them.
13
14
ANALYSIS
15
A. Spoliation of Evidence.
16
17
Defendants lodge various concerns that MWoods was never sanctioned for alleged
18
discovery abuses, unlike the sanctions imposed on Defendants (i.e., $80,000.00). Defendants
19
are correct. The reason is threefold; namely: (i) the vast majority of discovery issues involved
20
the missing business and financial records of
21
responsibilty for their custody was ultimately that ofPenly (see, Section I(B) of
22
the Arbitration
23
Award); (ii) there was no credible or admissible evidence that MWoods either destroyed or
24
intentionally withheld any requested documents (unlike the multiple boxes of documents that
25
Penly failed to disclose); and (ii) any pary was able to have subpoena duces tecums issued to
26
third-party financial institutions to obtain copies of needed business or financial records - for
27
28
example, Penly was not prohibited from seeking copies (via a subpoena duces tecum) of
BAILEY.:.KENNEDY
8984 SPANISH RIDGE AVE
LAS VEGAS, NEVADA 89148
Page 2 of6
2
3
MWood's credit card statements directly from the credit card company. Consequently, while all
paries and their respective counsel were at times less than cooperative during the discovery
process and continuously accused each other of discovery abuses, there was no credible
evidence that MW oods engaged in spoliation; hence, no sanctions were imposed against him.
5
B. MWoods' Bonus.
After reviewing the Motion, the Opposition, and the Reply, no party disputes that
MWoods received $86,750.00 from the interpled funds, that EJA received $111,750.00 from the
10
of
11
the interpled funds. Since MWoods was, at the time he took his bonus, entitled to his bonus,
12
13
14
whether MWoods was entitled to the bonus, an issue which has already been ruled upon. Id.2
15
While perhaps disingenuous, the fact that MW oods argued that he should be awarded
16
17
18
funds does not somehow negate the fact that all he was entitled to through this arbitration is
19
$111,750.00 - the difference between the amount of his bonus award and the amount he
20
3
received from the interpled funds.
21
C. Penly's Breaches of
Fiduciary Duty.
22
Defendants assert that: (i) they are focused on "purely mathematical errors pertaining to
23
24
25
26 2 Defendants assert that there were insuffcient funds in EJA accounts to pay the bonuses at the time they
were awarded (i.e., December 29, 2006); however, admitted Plaintiffs' Exhibits 124 (Bates #MW0335 - showing a
27 balance of $683,294.73) and 126 (Bates #MW000789 - showing a beginning balance of $309,375.69) contradict
that assertion.
28
See, Footnote 7 of
BAILEY.:.KENNEDY
8984 SPANISH RIDGE AVE
LAS VEGAS, NEVADA 89148
Page 3 of6
evident mathematical miscalculation when it takes as a starting point a $2 milion valuation for
Woods' shares based off of a reference in Warren's email to a potential forthcoming offer
(which was never made) based on circumstances (Woods agreeing not to compete and to be
4
supportive) which were the primary staring points and which never were put into place;" and
5
(ii) the "evident mathematical miscalculation in the Arbitration A ward regarding the starting
point of the valuation of Cirrs' shares was further compounded by the evident mathematical
8
miscalculation pertaining to the diminishment of
value of
misconception that belies Defendants' assertions is that the valuation in the e-mail from Stuart
10
Waren was the "staring point" of
11
12
arived at by considering factors, including all of the testimony elicited at the arbitration hearing
13
and all of
14
the documents admitted into evidence; the undersigned's knowledge, training and
experience; and the information contained in the Stuart Warren e-maiL. Indeed, the undersigned,
15
as set forth in the Arbitration Award, recognized the deficiencies in the substance of Stuart
16
17
Warren's e-mail.5
18
19
Further, the fact that the value ofEJA (and therefore the value of
20
6
the damage award.
21
22
II II
23
II II
24
II II
25
26
27
5
See, Footnote 10 of
28
BAILEY.:.KENNEDY
8984 SPANISH RIE A VENU
LAS VEGAS, NEVADA 89148
Page 4 of6
DECISION
2
3
denied.
6
7
8
BAILEY.:. KENNEDY
By:
~~
~~:BLE~
Bar
No. 0137
evada
8984 Spanish Ridge Avenue
10
11
Arbitrator
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
BAILEY.:.KENNEDY
8984 SPANISH RIE AVE
LAS VEGAS, NEVADA 8914&
Page 5 of6
CERTIFICATE OF SERVICE
2
I hereby certify that on the /p'lday of April, 2015, a copy ofthe foregoing DECISION
3
ARBITRATION A WARD was served by sending a copy via electronic mail and by depositing a
5
true and correct copy in the U.S. Mail, first class postage prepaid, and addressed to the following
6
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
~6.kt
26
27
28
BAILEY.:.KENNEDY
8984 SPANISH RIE AVE
LAS VEGAS, NEVADA 89148
Page 6 of6