McCann, G. v. SBW Investments

2025 Pa. Super. 97
CourtSuperior Court of Pennsylvania
DecidedMay 6, 2025
Docket82 WDA 2024
StatusPublished

This text of 2025 Pa. Super. 97 (McCann, G. v. SBW Investments) is published on Counsel Stack Legal Research, covering Superior Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
McCann, G. v. SBW Investments, 2025 Pa. Super. 97 (Pa. Ct. App. 2025).

Opinion

J-A29038-24

2025 PA Super 97

G.NORMAN MCCANN, G. NORMAN : IN THE SUPERIOR COURT OF MCCANN IRREVOCABLE SPOUSAL : PENNSYLVANIA TRUST, G. NORMAN MCCANN : IRREVOCABLE TRUST FOR DAVID O. : MCCANN, G. NORMAN MCCANN : IRREVOCABLE TRUST FOR N. : JEFFREY MCCANN, G. NORMAN : MCCANN IRREVOCABLE TRUST FOR : GREGORY K. MCCANN, G. NORMAN : No. 82 WDA 2024 MCCANN IRREVOCABLE TRUST FOR : PAUL B. MCCANN, G. NORMAN : MCCANN IRREVOCABLE TRUST FOR : TIMOTHY D. MCCANN, G. NORMAN : MCCANN IRREVOCABLE TRUST FOR : KAREN JAMIESON, THE 2017 DAVID : O. MCCANN FAMILY TRUST, THE : 2017 N. JEFFREY MCCANN FAMILY : TRUST, THE 2017 GREGORY K. : MCCANN FAMILY TRUST, THE 2017 : PAUL B. MCCANN FAMILY TRUST, : THE 2017 TIMOTHY D. MCCANN : FAMILY TRUST, AND THE 2017 : KAREN JAMIESON FAMILY TRUST. : : Appellants : v. : : : SMB INVESTMENTS, LLC, TDWJR : INVESTMENTS, LLC, RICHARD W. : TALARICO, AND HJP ACQUISITION : LP. : : : :

Appeal from the Order Entered December 15, 2023 In the Court of Common Pleas of Allegheny County Civil Division at No(s): Case No. GD-21-001332

BEFORE: OLSON, J., LANE, J., and BENDER, P.J.E. J-A29038-24

OPINION BY BENDER, P.J.E.: FILED: May 6, 2025

Appellants, G. Norman McCann (“Norman”), G. Norman McCann

Irrevocable Spousal Trust, G. Norman McCann Irrevocable Trust for David O.

McCann, G. Norman McCann Irrevocable Trust for N. Jeffrey McCann, G.

Norman McCann Irrevocable Trust for Gregory K. McCann, G. Norman McCann

Irrevocable Trust for Paul B. McCann, G. Norman McCann Irrevocable Trust

for Timothy D. McCann, G. Norman McCann Irrevocable Trust for Karen

Jamieson, The 2017 David O. McCann Family Trust, The 2017 N. Jeffrey

McCann Family Trust, The 2017 Gregory K. McCann Family Trust, The 2017

Paul B. McCann Family Trust, The 2017 Timothy D. McCann Family Trust, and

The 2017 Karen Jamieson Family Trust,1 purport to appeal from the trial

court’s December 15, 2023 orders granting summary judgment in favor of

Appellees, SMB Investments, LLC, TDWJR Investments, LLC, Richard W.

Talarico, and HJP Acquisition LP, and denying Appellants’ motion for summary

judgment.2 After careful review, we are constrained to vacate and remand.

____________________________________________

1 We refer to the trusts collectively as “Trusts.”

2 Norman is deceased but still listed in the caption of this appeal. For the reasons set forth below, we determine that his personal representatives must be properly substituted in his place. For ease of discussion, we refer to Norman and the Trusts collectively as “Appellants.”

-2- J-A29038-24

In Appellants’ second amended complaint, they alleged the following

facts in pertinent part.3 Each of the Trusts were established on behalf of

Norman and his family. See Second Amended Complaint, 12/1/22, at ¶ 15.

A primary asset in each of the Trusts is shares of common voting stock

(“Stock” or “Pledged Stock”) in The Bantry Group Corporation (“Bantry”),

which is a holding company that owns 100% of the capital stock of Wexford

Health Sources, Inc. (“Wexford”). Id. at ¶ 16. Wexford provides medical

services to inmates in prisons and jails throughout the United States, and is

the only operating entity of Bantry. Id. at ¶¶ 24-25. Richard Talarico, Thomas

Wright, and Henry Posner, Jr. originally owned the Stock; Posner is the

predecessor in interest of Appellee HJP Acquisition, and Wright is the

predecessor in interest of Appellees SBW Investments and TDWJR

Investments. See id. at ¶ 33.4

By way of background, in 2003, Wexford was an economically distressed

company, and Norman — who had previously retired from Bantry — returned

to Bantry and assumed primary control of Wexford. Id. at ¶¶ 27-29. At that

time, Appellees sold the Stock to Norman under a Stock Purchase Agreement.

Id. at ¶¶ 33-34. Norman’s purchase of the Stock was financed through a ____________________________________________

3 Norman and the Trusts were represented by the same attorneys below and

submitted joint filings. The record indicates that Norman’s son — N. Jeffrey McCann — had a general durable power of attorney for Norman.

4 To facilitate and simplify our discussion, we refer to Appellees and/or their

predecessors (if any) as “Appellees.” We recognize, however, that Posner and Wright are not parties to this action.

-3- J-A29038-24

Promissory Note in the principal amount of $7.55 million, with Appellees as

payees. Id. at ¶ 35. Norman and Appellees also entered into an Additional

Consideration Agreement (“ACA”) pursuant to which Norman agreed to pay

one-half of certain defined distributions to Appellees. Id. at ¶ 36. In addition,

Appellees and Norman entered into a Stock Pledge Agreement to secure

Norman’s obligations arising out of the Promissory Note and the amounts

called for in the ACA. Id. at ¶ 37. In total, Appellees sold all their voting

stock in Bantry to Norman, and they took a security interest in the Stock. Id.

at ¶ 38. The Stock Purchase Agreement, Promissory Note, ACA, and Stock

Pledge Agreement are collectively referred to as the “Operative Agreements.”

After Norman returned and assumed primary control of Wexford,

Wexford enjoyed a turnaround and a sustained period of success that allowed

Appellees to be paid the full amount of the Promissory Note, plus compounded

interest of approximately $2.5 million. Id. at ¶¶ 40, 44. Furthermore,

between 2003 and the time the second amended complaint was filed,

Appellees received more than $40 million pursuant to the ACA. Id. at ¶ 44.

Under the Stock Pledge Agreement, Norman agreed not to transfer all

or any part of his right, title, and interest in and to the Stock so long as any

of the obligations remain outstanding. Id. at ¶ 46. Accordingly, in 2017, he

requested and received Appellees’ consent to gratuitously transfer a portion

-4- J-A29038-24

of the Stock to the Trusts. Id. at ¶ 47.5 Subsequently, in 2020, Norman

again requested Appellees’ consent to gratuitously transfer more of the Stock

for estate and management planning purposes. Id. at ¶ 48. This time,

however, Appellees refused to consent, and instead issued a comprehensive

written information request, dated August 12, 2020, to Norman. Id. at ¶ 49.6

In December of 2020, Gleason & Associates, P.C. (“Gleason”) completed

an independent business valuation of the fair market value of Bantry, which

included its subsidiary Wexford. Id. at ¶¶ 53-54. Appellees were notified that

Appellants intended to sell the Stock based on the Gleason valuation and that

the Operative Agreements would be terminated after Appellees received one-

half of the purchase price for the Stock. Id. at ¶ 55. In response, Appellees

insisted that their consent is needed to sell the Stock, and that a sale of the

5 Though not mentioned in the second amended complaint, Appellants also advance that, “in late 2004, [Norman] sought, and received, [Appellees’] consent to transfer some of his [Stock] to his family’s [T]rusts.” Appellants’ Brief at 17-18 (citation omitted). They further explained that Appellees’ consent for the transfers was given “in exchange for the execution, by the [T]rusts, of [j]oinder [a]greements making the [T]rusts parties to the [p]ledge (which, of course, incorporates the ACA and the [Stock] Pledge Agreement).” Appellants’ Brief at 55 (citations omitted).

6 The August 12, 2020 information request sought various documents for the

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