Moore v. Altra Energy Technologies, Inc.

321 S.W.3d 727, 2010 Tex. App. LEXIS 6446, 2010 WL 3119523
CourtCourt of Appeals of Texas
DecidedAugust 10, 2010
Docket14-08-00362-CV
StatusPublished
Cited by32 cases

This text of 321 S.W.3d 727 (Moore v. Altra Energy Technologies, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Moore v. Altra Energy Technologies, Inc., 321 S.W.3d 727, 2010 Tex. App. LEXIS 6446, 2010 WL 3119523 (Tex. Ct. App. 2010).

Opinion

OPINION

JEFFREY V. BROWN, Justice.

This case was tried to a jury over allegations of common-law and statutory fraud, promissory estoppel, and breach of con *731 tract. The jury returned a verdict of $4 million against appellant Paul Moore in favor of appellees Altra Energy Technology, Inc., and Altra Electronic Trading Services, Inc. (“Altra”), on Altra’s claim of common-law fraud. The jury also awarded Altra $1.25 million on its breach-of-contract claim against appellee DGO, Inc., d/b/a The Ownby Companies (“DGO”). And the jury awarded DGO $1.25 million in actual damages and $10 million in exemplary damages against Moore for common-law and statutory fraud and promissory estoppel. The trial court reduced the exemplary award to $2.5 million pursuant to Texas Civil Practice & Remedies Code section 41.008 and entered judgment on the verdict. Moore filed this appeal.

Moore’s complaints about the judgment include: (1) the trial court erred by failing to realign the parties and properly allocate peremptory strikes; (2) the evidence supporting Altra’s fraud claim is legally and factually insufficient; (3) the evidence supporting DGO’s common-law and statutory fraud claims is legally and factually insufficient; (4) the evidence supporting DGO’s promissory-estoppel claim is legally and factually insufficient; (5) the trial court erred by refusing to submit proportionate-responsibility questions to the jury; and (6) the evidence supporting the jury’s punitive-damages award to DGO is legally and factually insufficient. We reverse the trial court’s judgment, remand in part for further proceedings in accordance with this opinion, and render in part a take-nothing judgment concerning Altra’s fraud claim against Moore.

I

Altra owned Chalkboard, which is a computer system used to trade commodities on the internet. In 2001, Altra began looking for a buyer who would be interested in purchasing the Chalkboard assets through a stock transaction. David Own-by and his son Daniel Ownby had assisted in developing the Chalkboard technology in the mid-1990s, and Altra contacted them about purchasing it. David’s company, DGO, hired attorney Richard Fuqua to raise money to help fund the purchase as well as handle all the legal aspects of the transaction. Fuqua had worked with David on prior business agreements, and he brought in an investor group including Tracy Turner, Moore, and Moore’s company, Maroon Bells Capital, LLC.

During trial, the testimony from the witnesses about the series of events leading up to the initiation of the lawsuit varied greatly. It is undisputed, however, that on November 15, 2001, Altra and DGO signed an agreement concerning the terms of the proposed sale of Chalkboard. Altra agreed to negotiate exclusively with DGO until the closing date in exchange for a $250,000 “Break-up Fee”; DGO would pay the fee if it did not execute a final agreement by the closing date. The original closing date was December 13. The agreement also required DGO to provide Altra with a commitment letter that ensured a third party would fund the purchase.

Fuqua, Turner, Moore, and David Own-by (“the Acquirers”) engaged Frost Securities, Inc. (“Frost”), to evaluate the feasibility of financing the Chalkboard sale. On November 29, before Frost issued its opinion, Altra and DGO agreed to amend the original agreement to increase the purchase price and delete the closing-price-adjustment clause. In a letter dated November 30, Frost stated to the Acquirers: “[W]e believe that this Acquisition Transaction is financeable under a variety of financing plans .... we are informed by the Acquirers that they have the ability themselves to provide funding in the amount of the purchase price.”

Altra employee Dixie Barrett testified that based on the Frost letter, Altra *732 amended the original agreement for the second time on December 10 to extend the closing date to December 21 as well as eliminate the exclusivity clause. Although Barrett testified the letter was not “strong enough” to be a true commitment letter, Altra claimed it relied on the letter in continuing its discussions with DGO.

David Ownby stated he proceeded with the discussions because Moore continuously urged through his words and actions he was interested in the transaction. David testified that on December 20, before DGO’s meeting with Altra, he called Moore to again discuss funding the transaction. According to David, Moore suggested “methods [by] which we could continue the contract,” which included increasing the “Break-up Fee” to $1 million. Fuqua and David testified that during their meeting with Altra, they stepped into the hall to call Moore about the transaction. Fuqua stated he explained the situation to Moore, and Moore said he would fund the deal. So the parties amended the agreement for a third time, increasing the “Break-up Fee” to $1 million, changing the closing date to January 31, and requiring DGO to immediately pay $250,000 as a sign of good faith. When Moore testified, however, he denied ever telling David or Fuqua he would fund the transaction. Moore explained he was interested in the transaction, but after conducting his own due diligence, he decided the deal was too risky; therefore, he never agreed to fund anything.

Fuqua wrote a check for $250,000 to Altra to cover the good-faith fee, and he testified Moore had agreed to wire him $250,000 to cover the amount of the check. Fuqua testified Moore never sent or wired Fuqua any money. The check was returned for insufficient funds. Fuqua stated he tried to tender the check for the second time, but it was returned again due to insufficient funds. DGO failed to close the sale by the closing date, and in June 2002, Altra sued David and Daniel Ownby, Fuqua, Fuqua’s law firm, and DGO based on a number of claims. Subsequently, Al-tra added Maroon Bells and Moore to the lawsuit. DGO and Fuqua brought third-party actions against Moore and Maroon Bells.

Before the trial, the court dismissed with prejudice Altra’s claims against David Ownby and the Fuqua defendants, but Al-tra continued to pursue its claims against DGO, Moore, and Maroon Bells. The claims at issue during the trial included Altra’s breach-of-contract claim against DGO, Altra’s common-law fraud claim against Moore, DGO’s common-law fraud claim against Moore, DGO’s statutory-fraud claim against Moore, and DGO’s promissory-estoppel claim against Moore. After hearing all the evidence, the jury returned a verdict against Moore for $4 million in actual damages in favor of Altra, for $1.25 million in actual damages in favor of DGO, and for $10 million in punitive damages in favor of DGO. The trial court reduced the punitive damages to $2.5 million. Moore timely filed a motion for new trial, but the trial court denied it. This appeal followed.

II

Altra’s Fraud Claims

Moore’s initial issue concerns the trial court’s failure to realign the parties or equalize peremptory strikes. But, because they are potentially dispositive of the ap-’ peal, we will first address Moore’s legal-sufficiency issues. In his second issue on appeal, Moore contends the evidence supporting Altra’s fraud claim is legally insufficient to support the jury’s verdict.

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Cite This Page — Counsel Stack

Bluebook (online)
321 S.W.3d 727, 2010 Tex. App. LEXIS 6446, 2010 WL 3119523, Counsel Stack Legal Research, https://law.counselstack.com/opinion/moore-v-altra-energy-technologies-inc-texapp-2010.