Trigger Energy Holdings v. Stevens

2025 S.D. 72

• Court: South Dakota Supreme Court
• Decided: December 22, 2025
• Docket: 30814
• Status: Published

Opinion

#30814-a-MES 2025 S.D. 72

IN THE SUPREME COURT OF THE STATE OF SOUTH DAKOTA

****

TRIGGER ENERGY HOLDINGS, LLC, and GULF COAST INVESTMENTS, LLC, Plaintiffs and Appellants,

v.

KENT STEVENS, as an individual, an officer, and agent; TCU HOLDINGS, LLC; and BLUEPRINT ENERGY PARTNERS, LLC, Defendants and Appellees.

APPEAL FROM THE CIRCUIT COURT OF THE SECOND JUDICIAL CIRCUIT MINNEHAHA COUNTY, SOUTH DAKOTA

THE HONORABLE DOUGLAS P. BARNETT Judge

DANIEL K. BRENDTRO MARY ELLEN DIRKSEN BENJAMIN M. HUMMEL of Hovland, Rasmus & Brendtro Prof. LLC Sioux Falls, South Dakota Attorneys for plaintiffs and appellants.

MATTHEW J. MCINTOSH ELLIOT J. BLOOM of Beardsley Jensen & Lee Prof. LLC Rapid City, South Dakota Attorneys for defendants and appellees.

ARGUED AUGUST 27, 2025 OPINION FILED 12/22/25 #30814

SALTER, Justice

[¶1.] Following the sale of their membership interests in Blueprint Energy

Partners, LLC, to TCU Holdings, LLC, the plaintiffs Gulf Coast Investments, LLC,

and Trigger Energy Holdings, LLC, sued to reform the purchase agreement they

had signed under a theory of economic duress. The plaintiffs’ complaint also alleged

various tort claims and breaches of fiduciary duties. The circuit court granted

summary judgment in favor of TCU on all counts. The plaintiffs appealed, arguing

the existence of genuine issues of material fact. We affirm the court’s decision

concluding there was no economic duress, and we also affirm the court’s decision to

grant summary judgment on the remaining claims, though under its alternative

analysis.

Factual and Procedural History

[¶2.] Blueprint was formed in 2017 to provide services and equipment for

shale oil extraction in and around Casper, Wyoming. Initially, Blueprint included

three members, each holding a one-third membership interest—Gulf Coast, Trigger,

and TCU. A fourth company—Aladdin Capital, Inc.—was appointed as Blueprint’s

exclusive manager. In addition to serving as manager, Aladdin provided Blueprint

with an initial $500,000 line of credit and financed its equipment purchases.

[¶3.] Scott Keogh is the vice president of—and a 49.9% shareholder in—both

Gulf Coast and Aladdin. Waylon Geuke is the president of Trigger.1 Kent Stevens

1. Trigger also operated in the oil and gas business in Casper, Wyoming, but Trigger specialized in the fracking process while Blueprint specialized in the “workover rig” business. In the oil and gas well-drilling business, “workover” refers to “a variety of remedial operations on a producing well to try to (continued . . .) -1- #30814

owns TCU. Given his personal experience in the oil and gas industry, Stevens was

appointed as Blueprint’s operations manager. In this capacity, Stevens oversaw

day-to-day operations and was responsible for hiring Blueprint’s workforce, most of

whom had followed him from his previous employer.

[¶4.] Blueprint was slow to take off. At the outset, the company failed to

meet financial projections, struggled to pay down debt, and suffered personal

conflict among its members. In Keogh’s words, Blueprint immediately “started

going backwards on cash” and quickly wiped out its $500,000 line of credit. At its

peak, Blueprint’s debt obligations, mostly to Aladdin, were close to $6 million.

[¶5.] Blueprint’s operations and initial performance became a point of

contention among the members and was often discussed at their monthly meetings,

which Keogh described as unpleasant. Accountability also became a source of

friction for Keogh, who felt that Stevens was neither adhering to company policies

nor enforcing them among his crew.

[¶6.] For his part, Stevens found the monthly meetings unfruitful, especially

when Keogh and Waylon—who Stevens saw as passive investors—criticized the

company’s day-to-day operations. In August 2018, Stevens expressed his desire for

TCU to buy Gulf Coast’s and Trigger’s membership interests in Blueprint. He made

________________________ (. . . continued) increase production.” Workover, OSHA, https://www.osha.gov/etools/oil-and- gas/servicing/workover (last visited Oct. 1, 2025). A workover rig is a specific type of drilling rig that is used to perform the remedial operations. Transcontinental Energy Servs., Workover Rigs, https://tces.us/workover-rigs (last visited Oct. 1, 2025).

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it clear that he did not want to work with Keogh and that he was interested in

finding a financial backer to help him reorganize Blueprint’s ownership structure.

[¶7.] By late 2018, Blueprint’s revenue began to catch up with its initial

projections. For the first time since its formation, the company consistently had

positive cash flow at the end of every month. Unfortunately, the company’s

improved financial condition did not lead to enhanced working relations.

[¶8.] In late February 2019, Stevens, on behalf of TCU, announced his

intent “to find financing or investors and” purchase Gulf Coast’s and Trigger’s

interests in Blueprint. As reflected in his deposition testimony, Keogh took this

offer seriously, explaining that he “wanted to sell the company”:

We just didn’t get along. And, you know, whether you’re making money or not, you have to enjoy what you’re doing. And if you don’t enjoy what you’re doing, you should do something different. And that was where we were at. We did not work together well. And so for that reason, I was willing to consider [selling].

Stevens told Keogh and Waylon that he would make them an offer through a letter

of intent (LOI) the following week.

[¶9.] While awaiting TCU’s offer, Keogh and Waylon discussed Blueprint’s

value. Keogh felt each membership interest was worth $1.5 million, applying the

following valuation method:

I reviewed the financials. . . . I just used a multiple of EBITDA,[2] which is a very normal way of establishing a price for the sale of a company. EBITDA was around 2.7 or [2.8],

2. EBITDA stands for earnings before interest, taxes, depreciation, and amortization and is a method used to calculate true profitability. See Excel Underground v. Brant Lake Sanitary Dist., 2020 S.D. 19, ¶ 57 n.15, 941 N.W.2d 791, 807 n.15.

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approximately, at that time, February, the preceding 12 months, multiplied by 4, subtracting out the liabilities, which were almost $6 million at that time, divided by 3. And the math works out to approximately 1.7 and change. I rounded down. My number was 1.5.

[¶10.] Keogh and Waylon received TCU’s written LOI on May 31, 2019. That

letter reflected TCU’s offer to buy the shares for $800,000 per unit. But this letter

was not the first time Keogh or Waylon heard of TCU’s $800,000 proposed price.

[¶11.] On several occasions between the February meeting and the May 31

LOI, Stevens told Waylon that he would “blow up the company”— meaning leave

Blueprint, break his non-compete agreement, and take the employees and

customers with him—if Waylon and Keogh would not accept $800,000 for their

respective shares. This threat came to be known as the “dynamite option.” Every

time Stevens made this threat to Waylon, Waylon conveyed it to Keogh. Waylon

took Stevens’s threats seriously, but Keogh remained adamant that the price was

open for negotiation. In his words, he “discounted” Stevens’s threat: “I couldn’t

believe it was true that he would actually blow up the company . . . .”

[¶12.] When Keogh received the LOI, he sent it to his Sioux Falls attorney,

John Mullen, who was to handle the negotiations with TCU’s Wyoming attorney,

Kyle Ridgeway.3 Keogh did not personally negotiate with Stevens. As he

explained, “The only negotiating occurred between Ridgeway and Mullen in the

terms of the LOI and the final documents,” adding “[w]e settled for the lawyers

doing [the negotiating].” Once Mullen received the draft LOI from Keogh, he made

3. Trigger did not have an attorney of its own participate in the negotiations over the terms of the LOI or the Purchase Agreement. Waylon stated that he would be willing to sign both if Keogh felt comfortable signing.

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redline edits and emailed it back to Ridgeway. In his email, Mullen conveyed that

“his primary areas of adjustment [were] timing of closing, tax matters, and

indemnity.” Mullen and Ridgeway exchanged numerous emails and phone calls

over the following days while settling the terms of the LOI.

[¶13.] As part of the negotiations, Mullen proposed a shorter closing window

and a price true-up, or adjustment to the sale price to reflect the performance of the

company between the time of the agreement, itself, and the closing date. But

Ridgeway explained that both items were non-negotiables.4 So Mullen continued

negotiating “to put the best deal together we could being told there would be no

such adjustments.” After Mullen relented on the price adjustment, Ridgeway

expressed his relief that Stevens would not have to exercise the dynamite option.

The attorneys ultimately agreed on the terms of the LOI, and it was set to be signed

by the members on June 10, 2019, in Casper.

[¶14.] In the days leading up to the signing of the LOI, Keogh believed the

price was still open for negotiation. Up until June 6, Keogh’s “intent was always to

sit face to face with [Stevens]” and negotiate the final price. Even though the terms

of the LOI had already been negotiated by the attorneys, he planned to travel to

Casper on June 10, sit down with Stevens, and “finally discuss . . . price face to face

and agree on something.” In Keogh’s eyes, “it’s not [an agreement] until we sign it.

And I was not going to sign it until we had that conversation.” Keogh’s plans

4. The accelerated closing date of twenty-four days was rejected in favor of sixty days because twenty-four days did not allow the new investors and lender enough time to get everything in order. Though Mullen felt that the deal could be closed earlier, “it didn’t shock [him] that they wanted more time to close” the deal.

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changed, however, when Mullen informed him of Ridgeway’s relief regarding

Stevens not needing to exercise the dynamite option, and Keogh signed the LOI

without addressing the price.

[¶15.] The terms of the LOI did not foreclose Keogh from revisiting the

proposed purchase price or even walking away from the sale altogether. The LOI

stated, “This Letter reflects the intention of the Parties, but for the avoidance of

doubt neither this Letter nor its acceptance shall give rise to any legally binding or

enforceable obligation on any Party . . . .” Further, the LOI directly instructed the

parties to negotiate a final purchase agreement: “As soon as reasonably practicable

after the execution of this Letter, the Parties shall commence to negotiate a

definitive purchase agreement . . . relating to Buyer’s acquisition of the Ownership,

to be drafted by the Parties’ counsel.” The parties executed the final Membership

Interest Purchase Agreement (Purchase Agreement) on July 30, 2019.

[¶16.] However, before signing the final agreement to sell Gulf Coast’s

membership share, Keogh weighed his options with Mullen, who advised him of

several alternatives to selling. These options included: (1) do not sell the

membership shares to TCU at all; (2) remove Stevens as Manager and trigger a

mandatory buy-sell option under Stevens’s written employment contract; (3) fire

Stevens, hire a replacement work crew, and then sue Stevens for the resulting

damages; or (4) sue Stevens for tortious interference with a business relationship.

[¶17.] Believing that all these “were bad options,” Keogh signed the Purchase

Agreement, as did Waylon, selling Gulf Coast’s and Trigger’s ownership interests in

Blueprint to TCU. As contemplated in the LOI and Purchase Agreement, Gulf

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Coast and Trigger both received $800,000 for their respective membership interests.

In addition, Aladdin was paid $3,280,150.94 under a separately negotiated

provision that required TCU to satisfy the outstanding Aladdin debt.

[¶18.] As part of the closing, both Keogh and Waylon signed Officer’s

Certificates confirming their authority to execute the Purchase Agreement for their

respective companies. They also signed a Funds Flow Memorandum, which details

that “to fund the payments referenced in [the Purchase Agreement], TCU ha[d]

received a $3,000,000 loan from Jonah Bank of Wyoming, and a $2,500,000 capital

contribution from the ‘Galles Group.’” In exchange for its capital contribution, the

Galles Group received a fifty percent stake in Blueprint.5

[¶19.] Not long after the sale, Keogh and Waylon, on behalf of Gulf Coast and

Trigger, sued Stevens, TCU, and Blueprint, alleging (1) economic duress, (2) breach

of the operating agreement, (3) breach of fiduciary duties, (4) tortious interference,

(5) shareholder oppression, and (6) unjust enrichment and usurpation. The

plaintiffs also sought an accounting, costs and attorney fees, and injunctive relief.

[¶20.] The defendants filed an initial motion for summary judgment, but for

reasons not clear in the record, the circuit court never heard the motion, and the

case was scheduled for trial. However, the defendants moved for summary

judgment a second time, which the court granted in a written memorandum opinion

and order.

5. The plaintiffs point out that TCU bought their shares of Blueprint for $1.6 million ($800,000 per unit) and later sold all but 16.6% of that to the Galles Group for $2.5 million.

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[¶21.] The circuit court explained that the plaintiffs entered the Purchase

Agreement “knowingly, competently, and voluntarily” and, after weighing their

options, made a calculated choice “to not pursue the other options provided by

Mullen due to the avoidance of a less-favorable financial outcome.” Having

determined that the Purchase Agreement was valid and not a product of economic

duress, the court concluded that the plaintiffs waived the remainder of their claims

through what the court believed to be a release in the Purchase Agreement. But, in

the alternative, the court addressed each of the remaining claims on their merits.

[¶22.] On those remaining claims, the court concluded that the parties,

through the Purchase Agreement, “agreed that the sale was in compliance with the

Operating Agreement”; that Stevens’s conduct did not constitute a breach of

fiduciary duties; that the plaintiffs could not be oppressed shareholders because

TCU was, in effect, the minority shareholder while the plaintiffs were negotiating in

tandem; that the equitable remedy of unjust enrichment did not apply; that the

plaintiffs’ tortious interference claim failed as a matter of law because there was no

“identifiable third-party”; and finally, that the request for accounting, costs and

attorney fees, and injunctive relief were moot.

[¶23.] The plaintiffs now appeal the circuit court’s grant of summary

judgment on each issue, arguing that genuine issues of material fact exist and that

the case should be remanded for a trial by jury.

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Analysis and Decision

Summary judgment standard

[¶24.] “We review a circuit court’s entry of summary judgment under” SDCL

15-6-56(c) de novo. Healy Ranch, Inc. v. Healy, 2022 S.D. 43, ¶ 17, 978 N.W.2d 786,

793 (citation omitted). Our task “is to determine only whether a genuine issue of

material fact exists and whether the law was correctly applied.” Sacred Heart

Health Servs., Inc. v. Yankton County, 2020 S.D. 64, ¶ 11, 951 N.W.2d 544, 548

(citation omitted). We “will affirm the circuit court’s summary judgment decision if

there exists any basis which supports” its ruling. Davies v. GPHC, LLC, 2022 S.D.

55, ¶ 17, 980 N.W.2d 251, 258 (citation modified).

Economic duress

[¶25.] Economic duress is an “outgrowth of the common law doctrine of

duress.” Dunes Hosp., LLC v. Country Kitchen Int’l, 2001 S.D. 36, ¶ 17, 623 N.W.2d

484, 489. While “common law duress was concerned exclusively with either

physical imprisonment or threats of serious bodily harm,” the defense of economic

duress recognizes that a party “in economic straits” may be coerced into entering a

contract to avoid “suffering a serious business loss if accession is withheld.” Id.

(quoting Drier v. Great Am. Ins., 409 N.W.2d 357, 360 (S.D. 1987)).

[¶26.] But it is not enough to show that the contract was entered under “the

pressure of financial circumstances.” 25 Am. Jur. 2d Duress & Undue Influence

§ 19, Westlaw (database updated Nov. 2025). “[H]ard bargaining is acceptable, and

even desirable, in our economic system and [will] not be discouraged by” judicial

intervention. Id. § 20. We are, accordingly, reluctant to set aside a contract on the

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basis of economic duress “absent special, unusual or extraordinary circumstances.”

Dunes, 2001 S.D. 36, ¶ 33, 623 N.W.2d at 492.

[¶27.] In our Dunes decision, we identified three constituent elements for an

economic duress claim:

1. Involuntarily accepting “the terms of another”; 2. Circumstances which permitted no reasonable alternative; and 3. Circumstances that “were the result of a coercive wrongful act of the opposite party.”

Id. ¶ 19, 623 N.W.2d at 490.

[¶28.] These elements are by their nature interrelated. For example, the first

two elements—involuntary acceptance and no reasonable alternative—would in

many, if not all, cases contemplate overlapping considerations; if a person truly has

another alternative, the decision to accept another’s terms would be voluntary.

[¶29.] More traditional formulations of the economic duress doctrine often

feature a two-element approach under which a party must show: (1) they have

“been the victim of a wrongful or unlawful act or threat; and (2) that the act or

threat deprived [them] of free or unfettered will.” 28 Williston on Contracts § 71:17,

Westlaw (database updated May 2025). We perceive no fundamental difference

between this formulation and the three-element version of economic duress we

described in Dunes.

[¶30.] Both tests are designed to assess a party’s volition in light of another

party’s conduct. And under either formulation, economic duress exists when one

party’s wrongful act or threat causes such financial distress for another that it

deprives the latter of their free will and judgment because they are left with no

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adequate remedy or reasonable alternative but to assent to the bad actor’s terms.

See 25 Am. Jur. 2d Duress & Undue Influence § 19.

[¶31.] The principal advantage of the two-element formulation lies in its

comparative ease of application because it eliminates overlapping elements

inherent in the Dunes version and better emphasizes the essence of economic

duress—the absence of real consent. See Waara v. Kane, 269 N.W.2d 395, 397 (S.D.

1978) (“The contractual defense of duress requires that there has been such

constraint upon the complainant that the complainant was forced to act against his

own free will.” (citation omitted)).

[¶32.] Regardless of which test is used here, the plaintiffs are unable to

sustain their claim of economic duress, and the circuit court correctly granted the

defendants’ motion for summary judgment. Even when viewed in a light most

favorable to the plaintiffs, no reasonable factfinder could conclude that they entered

the Purchase Agreement involuntarily.

[¶33.] Acceptance is involuntary “when the actor lacks any real choice or

alternative” in any meaningful sense of the word. Ismert & Assocs. v. New England

Mut. Life Ins., 801 F.2d 536, 549 (1st Cir. 1986) (Breyer, J., writing for the court on

Part V). The plaintiffs have cast this test as a factual one to evaluate the

advisability of their competing options, but this is wide of the mark.6

6. The plaintiffs argue they were coerced into signing the Purchase Agreement because “[s]ubjectively, Gulf Coast and Trigger believed they had no other option.” But “[t]he mere assertion that one’s free will was subverted . . . cannot bolster a claim that is unsupported by the facts and that would otherwise not withstand a motion for summary judgment.” Freedlander Inc., The Mortg. People v. NCNB Nat. Bank, 706 F. Supp. 1211, 1212 (E.D. Va. (continued . . .) -11- #30814

[¶34.] Though the circumstances may be economic, duress is still compulsion

to an extent that a party effectively has no option but to accede to another’s terms.

In this regard, it is not the relative reasonableness of an option that lies at the

heart of the economic duress doctrine; it is the existence of even one option that

would realistically allow a party the ability to not accept the terms of another. As

then-Judge Breyer explained in somewhat earthy terms in the First Circuit’s Ismert

decision, an act of will is “unfree . . . when the actor lacks any real choice or

alternative (‘your money or your life’).” Id.

[¶35.] The undisputed facts here fall short of the compulsion necessary to

sustain the plaintiffs’ economic duress claim; the plaintiffs had reasonable

alternatives. In his deposition testimony, Keogh acknowledged that Mullen

presented him with several alternatives to selling his shares, including available

legal remedies. Mullen himself testified that he advised Keogh of the following

alternatives:

I advised my client that they could, as one of its alternatives, consider terminating Kent Stevens as the operations manager. In other words, causing Blueprint to terminate Kent’s position of employment as an individual . . . and then his termination would then, I recommended, would then give the trigger for a mandatory buy-sell under the operating agreement.

________________________ (. . . continued) 1988); see also Berardi v. Meadowbrook Mall Co., 572 S.E.2d 900, 905 (W. Va. 2002) (noting that “economic duress does not turn only upon the subjective state of mind of the plaintiffs”). It is true that the test for involuntariness features some individualized, subjective aspects, see 28 Williston on Contracts, supra, § 71:11 (discussing how the test for involuntariness accounts for a particular plaintiff’s susceptibilities), but courts “must still assess whether [a plaintiff’s] claims are sufficiently supported by objective evidence that a jury should pass upon their merits.” Freedlander, 706 F. Supp. at 1216.

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I advised them that Kent Stevens and his company would very likely resist that effort and that there would be protracted litigation regarding that and that starting a lawsuit to seek injunctive relief is different than winning a lawsuit for injunctive relief, in a timely and effective manner to preserve the company’s business opportunities. But, yes, we did cover the ability to commence litigation against Kent.

*** I also advised them that they could—the fear was that if they fired Kent, they would in fact, not lose just Kent Stevens, but they would lose all of the crews, because the reality was Kent had the relationships with the crews. And I said that you could give consideration to hiring an entire crew at a material expense and that would be perhaps the measure of their damages when they sued Kent and prevailed.

[¶36.] Although Keogh was unsatisfied with these options, they were,

nevertheless, real alternatives to accepting TCU’s $800,000 offer.7

a. The ability to sue and competent counsel during negotiations

[¶37.] Because “our legal system provides remedies which are reasonably

effective in protecting the innocent against improper pressures under ordinary

circumstances,” John Dalzell, Duress by Economic Pressure I, 20 N.C. L. Rev. 237,

240 (1942), “[t]he availability of a legal resolution is one . . . circumstance” a court

reviewing a claim of economic duress considers, Dunes, 2001 S.D. 36, ¶ 21, 623

N.W.2d at 490; Ismert, 801 F.2d at 549 (“Courts have consistently held that the

presence of an adequate legal remedy undermines claims of economic duress.”).

7. During his deposition, Keogh acknowledged that he also could have simply elected not to sell the membership interests of Gulf Coast to TCU.

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[¶38.] In fact, in Dunes, we held that the plaintiff was not the victim of

economic duress because it could have sued the defendant before executing the

settlement agreement at issue, just as it did two months after signing the contract.

2001 S.D. 36, ¶ 32, 623 N.W.2d at 492. We also noted, in this regard, the business

acumen of the plaintiff company’s investors and their representation by

“experienced, competent lawyers”—facts which also exist here.8 Id.

[¶39.] During his deposition, Keogh testified that both he and Waylon were

executive officers of their own respective companies, and he specifically

acknowledged that he was a sophisticated businessperson. The plaintiffs also had

the benefit of competent and experienced legal counsel to provide candid legal

advice about the available options, as the excerpt from Mullen’s deposition set out

above indicates.

[¶40.] But Mullen’s assistance was not confined to simply providing advice

about how to handle Stevens’s intransigence on price. Mullen also played a large

role in negotiating the terms of the LOI through the negotiation and signing of the

Purchase Agreement. During communications with his counterpart, Ridgeway,

8. In Dunes, we reversed a circuit court’s denial of a motion for judgment notwithstanding the verdict because the facts did not support the jury’s finding of economic duress. 2001 S.D. 36, ¶¶ 30–34, 623 N.W.2d at 492. There, the plaintiff tried to repudiate a settlement agreement by claiming it was procured by economic duress. Id. ¶ 5, 623 N.W.2d at 487. The undisputed facts, however, showed that the plaintiff had several alternatives to the settlement agreement, including “firing [the defendant] and replacing them with a new manager, running the [business] themselves, or filing suit.” Id. ¶ 3. But instead of exercising one of these alternatives, the plaintiff decided to settle first and then sue. Id. ¶ 32, 623 N.W.2d at 492. Because the plaintiff’s “decision to enter into th[e] settlement agreement was the result of an informed and deliberate” choice selected from reasonable alternatives, we held the economic duress claim failed as a matter of law. Id. ¶¶ 32–33.

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Mullen proposed changes to adjust the time of closing, certain tax matters, and the

indemnity provision. Ridgeway, for his part, communicated that his client had two

non-negotiable items—the membership interest price and the closing date. Mullen

understood this to be within the “give and take” of negotiation—“you give us the

rest of [what] we want, we’ll walk away from the price adjustment.” So within those

parameters, the plaintiffs “continued to negotiate” and “attempted to put the best

deal together” knowing “there would be no [true-up price] adjustments.”

[¶41.] Significant in this regard is the fact that the Purchase Agreement

contemplated more than the purchase and sale of Gulf Coast’s and Trigger’s

membership interests. Besides the sale price, Keogh’s principal concern was the

outstanding debt Blueprint owed to his affiliated company, Aladdin.9 Initially,

Aladdin had provided Blueprint with a $500,000 open line of credit, but the amount

of credit it ultimately extended grew to over $3 million. Aladdin had, itself,

borrowed the money, and Keogh was anxious to have it repaid.

[¶42.] Mullen successfully negotiated terms in both the LOI and the Purchase

Agreement that satisfied the debt to Aladdin even though, strictly speaking,

Aladdin was unconnected to the equity buyout and Blueprint was making regular

payments and reducing the debt incrementally each month. As a result, at closing,

Aladdin received $3,280,150.94, allaying Keogh’s repayment concerns and giving it,

at least in part, exactly what it wanted.10 See JPM, Inc. v. John Deere Indus.,

9. Keogh was a co-owner of both Gulf Coast and Aladdin.

10. The plaintiffs appear content to retain the benefit of this repayment to Aladdin and have asked for a very limited type of contract reformation in (continued . . .) -15- #30814

Equip. Co., 94 F.3d 270, 272 (7th Cir. 1996) (stating that when a contract is entered

with the hope or expectation of obtaining a benefit, “there is not duress” (citation

omitted)).

b. Length of negotiation period

[¶43.] Beyond this, the undisputed facts surrounding the transaction

preclude any reasonable inference that the plaintiffs’ decision to enter into the

Purchase Agreement was rushed or uncounseled, as is often the case in successful

economic duress claims. See Freedlander, 706 F. Supp. at 1217 (“[D]uress is usually

marked by immediacy.”).

[¶44.] For example, in Bakerman v. Sidney Frank Importing Company, No.

1844, 2006 WL 3927242, at *4–5, 17 (Del. Ch. Oct. 10, 2006), the Delaware Court of

Chancery determined that a plaintiff’s will was overridden when, after months of

secret negotiations, he was presented with an “eleventh hour ultimatum” that gave

him only 30 minutes to either sell his shares for “$0.475 on the dollar” or “have his

employment terminated . . . and be sued by [the defendants].” The plaintiff was

also denied the opportunity to “confer with counsel” within those 30 minutes. Id. at

*17; see also Berardi, 572 S.E.2d at 906 (“[W]here an experienced businessman

takes sufficient time, seeks the advice of counsel[,] and understands the content of

what he is signing[,] he cannot claim the execution of the release was a product of

duress.” (quoting Schmalz v. Hardy Salt, Co., 739 S.W.2d 765, 768 (Mo. Ct. App.

1987)))

________________________ (. . . continued) their complaint that would reform the Purchase Agreement to allow only a price adjustment.

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[¶45.] But here there was no immediacy. The lapse of time between when the

plaintiffs first learned of TCU’s desire to buy their shares—August 2018—and when

the Purchase Agreement was executed—July 2019—spans nearly one year. And

even the specific timeframe for negotiating and drafting the LOI was not rushed.

Stevens originally stated that TCU would provide Keogh and Waylon a draft LOI

during the first week of March, but he did not end up doing so until the last day of

May. Notably, it was the plaintiffs who proposed an accelerated closing deadline—a

proposal the defendants ultimately rejected. And the actual negotiations between

the parties’ attorneys spanned sixty days and included two separate written

agreements—the LOI and the final Purchase Agreement.

[¶46.] On these undisputed facts, the plaintiffs simply cannot “demonstrate

that no reasonable alternative existed but to accede to” TCU’s terms. Dunes, 2001

S.D. 36, ¶ 32, 623 N.W.2d at 492. After reviewing the record in a light most

favorable to the plaintiffs, the circumstances here are not “special, unusual or

extraordinary.” Id. ¶ 19, 623 N.W.2d at 489. Accordingly, the plaintiffs cannot, as a

matter of law, establish economic duress.11

The effect of section 2.03

[¶47.] Section 2.03 of the Purchase Agreement provides as follows:

11. We note parenthetically that our decision here is consistent with our general aversion to judicial intervention in private agreements, particularly those that are designed to resolve disputes. See, e.g., Parkhurst v. Burkel, 1996 S.D. 19, ¶ 12, 544 N.W.2d 210, 212 (observing that public policy “favors the compromise and settlement of disputed claims outside of court”); A. Unruh Chiropractic Clinic v. De Smet Ins., 2010 S.D. 36, ¶ 18, 782 N.W.2d 367, 373 (collecting cases stating the same).

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Legal Proceedings. There is no claim, action, suit, proceeding or governmental investigation (“Action”) of any nature pending or, to Seller’s knowledge, threatened against or by Seller (a) regarding to or affecting the Membership Interests; or (b) that challenges or seeks to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement. No event has occurred or circumstances exist that may give rise to, or serve as a basis for, any such Action.

[¶48.] The circuit court accepted the defendants’ argument that the last

sentence of Section 2.03 operates as a release that waived the plaintiffs’ remaining

claims. In the court’s view, “[t]his language clearly and unambiguously exhibits

Plaintiffs’ recognition and agreement that nothing was present at the time of

formation that would give rise or serve as a basis to sue . . . on Plaintiffs’ remaining

claims, as they all are alleged to have occurred before the or during formation of the

Purchase Agreement.”

[¶49.] We read Section 2.03 differently. It is not a release; it is a seller’s

warranty and representation. See Alexander v. Est. of Hobert, 2025 S.D. 39, ¶ 16,

24 N.W.3d 758, 764 (holding “contract interpretation is a question of law reviewed

de novo” (citation modified)).

[¶50.] A release “is a direct and immediate destruction of a claim terminated

by mutual agreement.” 29 Williston on Contracts, supra, § 73:1; see also Fenske

Media Corp. v. Banta Corp., 2004 S.D. 23, ¶ 8, 676 N.W.2d 390 (“Releases are

contractual agreements.” (citation omitted)). “Stated somewhat differently, a

release is a binding agreement between the parties under which at least one party

to the agreement relinquishes an existing claim or cause of action against another

party to the agreement.” 29 Williston on Contracts, supra, § 73:1; see also Baha v.

United States, 144 Fed. Cl. 500, 504–05 (Fed. Cl. 2019) (describing a release as a

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contractual agreement “whereby a party abandons a claim or relinquishes a right

that could be asserted against another” (quoting Holland v. United States, 621 F.3d

1366, 1377 (Fed. Cir. 2010))).

[¶51.] By contrast, representations are statements of fact. Representation as

Statement of Fact, The Wolters Kluwer Bouvier Law Dictionary (last visited Aug.

14, 2025); Representation, Ballentine’s Law Dictionary (3d ed. 1969). And

warranties are promises about the condition and quality of the thing contracted

for—in this case, the membership interests. 1 Pirsig on Minnesota Pleading § 4.584

(“An express warranty is a clear, positive affirmation or representation of the

quality or condition of a thing sold . . . .”); see also Warranty, Ballentine’s Law

Dictionary (3d ed. 1969); Adrian v. Elmer, 284 P.2d 599, 602 (Kan. 1955) (“It is the

general rule of law that a warranty . . . [occurs] when the seller makes an

affirmation with respect to the article to be sold . . . upon which it is intended that

the buyer shall rely in making the purchase.”).

[¶52.] The plain language of Article II shows that Section 2.03 was meant to

serve as an affirmative representation by Gulf Coast and Trigger that the

membership interests they were selling were not legally encumbered or subject to

actual or potential claims and that there was no pending or threatened claim that

could adversely impact or delay the transaction. None of the language within

Section 2.03 clearly evinces the Seller’s intent to give up or relinquish any and all

legal claims arising out of or resulting from the transaction.12

12. There is a strong indication in the record that the Blueprint members understood a release as distinguished from a representation or warranty. (continued . . .) -19- #30814

[¶53.] The last sentence of Section 2.03 prompts the Seller, based on their

“current actual knowledge,” to represent that “[n]o event has occurred or

circumstances exist that may give rise to, or serve as a basis for, any [claim, action,

suit, proceeding or governmental investigation].” But the issue here is not whether

the plaintiffs made misrepresentations in violation of certain warranties. We are

asked only to interpret Section 2.03 to ascertain whether the parties released their

claims against the defendants.

[¶54.] Finally, though not a substitute for faithful textual interpretation, we

note that Section 2.03’s location within the Purchase Agreement supports our view.

Section 2.03 falls under Article II, which is titled, “Representations and Warranties

of Seller.” See RSUI Indem. Co. v. The Lynd Co., 466 S.W.3d 113, 121 (Tex. 2015)

(“Generally, courts should construe contractual provisions in a manner that is

consistent with the labels the parties have given them.”).

[¶55.] We therefore reverse the circuit court’s determination that Section 2.03

served as a waiver of rights. Since section 2.03’s plain language does not support a

release, it cannot serve as “a clear, unequivocal and decisive act showing an

________________________ (. . . continued) Blueprint’s Operating Agreement contains a release that applies during a mandatory buy-sell event and uses traditional mutual release language that differs materially from the text of Section 2.03:

As additional consideration for the Transfer, purchase and sale of any Units pursuant to this Agreement . . . the Transferring Member or other Seller shall forever discharge and release the Company and its other Members, managers, officers, [and] employees . . . from any and all claims, demands, losses, costs, expenses, obligations, liabilities, damages, recoveries or right to payment arising out of or resulting from the Releasor’s . . . status as a Member, Manager or officer of the Company . . . .

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intention to relinquish [an] existing right.” See Norwest Bank S.D. v. Venners, 440

N.W.2d 774, 775 (S.D. 1989) (citation omitted). However, because the court made

alternative rulings on the merits of the plaintiffs’ remaining arguments, we

continue and review those issues below.

Breach of operating agreement

[¶56.] The plaintiffs argue that Stevens and TCU breached Blueprint’s

Operating Agreement by preventing Gulf Coast and Trigger from utilizing the

appraisal process set forth in Article 14.3(d)(1) to ascertain Blueprint’s value and, in

turn, the per unit value of the membership interests. But when Keogh was asked

about this section of the Operating Agreement during his deposition, he testified

that it did not apply to this transaction:

I would note that [14.3(d)] is in conjunction with the buy-sell – trigger events of the buy-sell agreement. That’s not what we were doing. . . . This wasn’t -- you know, we didn’t treat it – it probably – it could have been a trigger potentially, but it wasn’t treated that way. It was someone – Kent expressed interest in buying us out and we expressed interest in selling. Valuation methods don’t matter in terms of determining the price. Its what he’s willing to pay or what we’re willing to sell for or some combination thereof.

[¶57.] This testimony is fatal to the plaintiffs’ claim that Stevens and TCU

breached the Operating Agreement because Keogh specifically stated that Article

14.3(d) did not apply. Our oft-quoted rule about contrary positions like this states

that “[a] party cannot assert a better version of the facts than [his] prior testimony

and cannot claim a material issue of fact which assumes a conclusion contrary to

[his] own testimony.” St. Pierre v. State ex rel. S.D. Real Est. Comm’n, 2012 S.D. 25,

¶ 23, 813 N.W.2d 151, 158 (citation modified).

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[¶58.] The plaintiffs’ breach-of-the-operating-agreement claim is also

precluded by provisions of the parties’ Purchase Agreement, which we have

determined to be valid and enforceable. See supra ¶¶ 29–47. The Purchase

Agreement specifically states that neither the “consummation of the transaction”

nor the execution and performance of the Purchase Agreement will “result in any

violation [or] conflict with . . . the Company’s organizational documents or the

Operating Agreement of the Company.” The circuit court properly granted

summary judgment in the defendants’ favor on this claim.

Breach of fiduciary duties

[¶59.] To recover for a breach of fiduciary duties, a plaintiff must prove: (1)

that the defendant owed them a fiduciary duty; (2) that the defendant breached

their fiduciary duty; (3) that the “plaintiff incurred damages; and (4) that the

defendant’s breach of [its] fiduciary duty was a cause of [the] plaintiff’s damages.”

Langbehn v. Langbehn, 2025 S.D. 11, ¶ 30, 18 N.W.3d 634, 643 (citation omitted).

“The existence and scope of a fiduciary duty are questions of law. Whether a breach

of a fiduciary duty occurred, however, is a question of fact.” Smith Angus Ranch,

Inc. v. Hurst, 2021 S.D. 40, ¶ 14, 962 N.W.2d 626, 629 (citation omitted).

[¶60.] Ordinarily, “shareholders do not owe a fiduciary duty to either the

corporation or their fellow shareholders.” Mueller v. Cedar Shore Resort, Inc., 2002

S.D. 38, ¶ 26, 643 N.W.2d 56, 66 (citation omitted). But for close corporations, the

standard is different. Id. “A close corporation is an entity with relatively few

shareholders, whose shares are not generally traded on the securities market.”

Heaton v. Rohl, 954 N.E.2d 165, 174 (Ohio Ct. App. 2011) (citation omitted). In

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South Dakota, “a group of shareholders acting together to exercise effective control,

are held to owe a fiduciary duty to minority shareholders.” Mueller, 2002 S.D. 38,

¶ 26, 643 N.W.2d at 66 (citation omitted); see also Heaton, 954 N.E.2d at 174 (“The

shareholders in a closely held corporation owe one another a fiduciary duty to act in

good faith and refrain from self-dealing.” (citation omitted)).

[¶61.] Where it exists, “[t]his fiduciary duty is characterized by a high degree

of diligence and due care, as well as the exercise of utmost good faith and fair

dealing.” Mueller, 2002 S.D. 38, ¶ 26, 643 N.W.2d at 66 (citation omitted). That

said, “South Dakota law reflects the traditional view that fiduciary duties are not

inherent in normal arm’s-length business relationships, and arise only when one

undertakes to act primarily for another’s benefit.” Smith Angus Ranch, 2021 S.D.

40, ¶ 14, 962 N.W.2d at 629 (citation omitted).

[¶62.] Our Legislature has also enacted the Uniform Limited Liability

Company Act. SDCL 47-34A-101 to 1207. Critically, the act distinguishes the

fiduciary duties owed by members in a member-managed company from those owed

in a manager-managed company. See SDCL 47-34A-409. Members in member-

managed companies owe certain fiduciary duties to the other members, including a

duty of loyalty and certain other duties of care as set out in SDCL 47-34A-409(b) to

(c).13

13. For instance, under SDCL 47-34A-409(b), a member must hold company property in trust and account for it and refrain from specific types of self- dealing and competition with the company. Subsection (c) goes on to explain that: “A member’s duty of care to a member-managed company and its other members in the conduct of . . . the company’s business is limited to refraining (continued . . .) -23- #30814

[¶63.] In a manager-managed company, however, the duties imposed on

members are different. Generally, “[a] member who is not also a manager owes no

duties to the company or to the other members solely by reason of being a member.”

SDCL 47-34A-409(h)(1). In cases where a member exercises some, but not all, of

the rights of a manager pursuant to an operating agreement, that member is

subject to the duties for member-managed companies “to the extent that the

member exercises the managerial authority vested in a manager by this chapter.”

SDCL 47-34A-409(h)(3). And non-member managers are subject to the same duties

as member managers. SDCL 47-34A-409(h)(2).

[¶64.] Here, Blueprint’s Articles of Organization show that it is a “Manager-

Managed” company.14 See SDCL 47-34A-101(11) (defining a manager-managed

company as “a limited liability company which is so designated in its articles of

organization”). Blueprint’s Operating Agreement further provides that the

company “shall be managed by one or more Managers upon the terms and

conditions set forth in this Agreement, and, to the extent not inconsistent herewith,

________________________ (. . . continued) from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law.” SDCL 47-34A-409(c).

14. Initial Filing, Articles of Organization, Wyoming Secretary of State, https://wyobiz.wyo.gov/business/FilingDetails.aspx?eFNum=02715123923413 5191035167215078231212248115168216 (last visited Aug. 10, 2025) (noting formation date of Sept. 01, 2017). Although Blueprint’s Articles of Organization are not provided in the record, this Court has previously taken judicial notice of articles of incorporation filed with a secretary of state’s office. See Nelson v. WEB Water Dev. Ass’n, 507 N.W.2d 691, 693 (S.D. 1993) (taking judicial notice of “articles of incorporation filed with the Secretary of State for the State of South Dakota”).

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the Act.”15 The Operating Agreement appointed Aladdin—a non-member—as the

sole manager “until such time as all debt or money owed by [Blueprint] to Aladdin

Capital, Inc., has been paid in full.”

[¶65.] As the exclusive manager, Aladdin had “full and complete discretion,

power and authority to manage, control, administer and operate the business and

affairs of the Company, and to make all decisions affecting such business and

affairs, all without a vote of any Members being necessary.” Also, in conformity

with SDCL 47-34A-409(h)(1), the Operating Agreement states that “a Member who

is not also a manager owes no duties to the Company or to the other Members solely

by reason of its, his or her, being a Member.”

[¶66.] So, although Blueprint likely meets the definition of a close

corporation, South Dakota’s Uniform Limited Liability Company Act, as well as the

terms of the parties’ Operating Agreement, control the existence and scope of the

parties’ fiduciary duties here. Because TCU was not a manager of Blueprint at the

time of the alleged wrongful conduct, it did not owe the other members any

fiduciary duties.

[¶67.] Stevens, however, was the company’s operations manager, one of the

designated “officer” positions identified in the Operating Agreement. But the

plaintiffs seem to conflate the two roles Stevens held—one as the operations

15. The Operating Agreement defines the “Act” as “the South Dakota Limited Liability Company Act, as codified at SDCL Ch. 47-34, as amended from time to time.” However, SDCL ch. 47-34 was repealed twelve years before the agreement was signed. See 2005 S.D. Sess. Law ch. 241 § 5. South Dakota laws governing limited liability companies are now found at SDCL ch. 47- 34A, which “governs all limited liability companies” after January 1, 2004. SDCL 47-34A-1205(c).

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manager and the other as TCU’s agent during the buyout negotiations. Even if

Stevens owed fiduciary duties to the other members in his role as operations

manager, that does not mean that he owed fiduciary duties to the members while

acting as TCU’s agent during negotiations because TCU itself did not owe the other

members any fiduciary duties. And to the extent that the plaintiffs’ claims relate to

any duties Stevens owed as the operations manager pursuant to SDCL 47-34A-

409(h)(2), the plaintiffs have not asserted claims of breach that would meet the

requirements for bringing a derivative action under SDCL 47-34A-1101.

[¶68.] The provisions of SDCL 47-34A-1101(a) authorize a member to

maintain a direct action against another member, manager, or the company to

enforce the member’s rights and interests. However, subsection (b) states that the

member bringing such direct action “must plead an actual or threatened injury that

is not solely the result of an injury suffered or threatened to be suffered by the

limited liability company.” The plaintiffs’ claim that Stevens breached a fiduciary

duty is based on his threats to “blow up the company” by resigning from his

position, taking his crew with him, and possibly Blueprint’s customers. Even if

such threats could be deemed a breach of the duty of loyalty or good faith and fair

dealing, any actual or threatened injury to the plaintiffs stemming from these

threats would result solely from the threatened injury to Blueprint. Thus, the

plaintiffs cannot legally sustain their breach of fiduciary duties claims on either

front.

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Tortious interference with business relations

[¶69.] The plaintiffs allege that Stevens and TCU tortiously interfered with

“a valid contractual and business relationship among Gulf Coast, Trigger, and TCU”

by “threatening to destroy Blueprint unless [the plaintiffs] agreed to” TCU’s buyout

offer. “This cause of action [recognizes] that valid business relationships and

expectancies are entitled to protection from unjustified interference.” Hayes v. N.

Hills Gen. Hosp., 1999 S.D. 28, ¶ 17, 590 N.W.2d 243, 248 (citation omitted).

Whether a plaintiff alleges tortious interference with a business relationship or an

existing contract or both, we analyze them under the same essential principles. See

Tibke v. McDougall, 479 N.W.2d 898, 908 (S.D. 1992) (noting that the tort of

intentional interference with a business relationship may also “consist of injury to

. . . an existing contractual relation”).

[¶70.] To prevail on a claim for tortious interference with business

relationships or expectancies, the plaintiffs must prove the following elements:

(1) the existence of a valid business relationship or expectancy; (2) knowledge by the interferer of the relationship or expectancy; (3) an intentional and unjustified act of interference on the part of the interferer; (4) proof that the interference cause[d] the harm sustained; and (5) damage to the party whose relationship or expectancy was disrupted.

Hayes, 1999 S.D. 28, ¶ 18, 590 N.W.2d at 248.

[¶71.] “One is liable for tortious interference with a business relationship ‘if

he interferes with business relations of another, both existing and prospective, by

inducing a third person not to enter into or continue a business relationship with

another or by preventing a third person from continuing a business relation with

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another.’” Miller v. Huron Reg’l Med. Ctr., Inc., No. 12-4138, 2014 WL 1608695, at

*2 (D.S.D. April 22, 2014) (quoting Setliff v. Akins, 2000 S.D. 124, ¶ 36, 616 N.W.2d

878, 889). “[T]o withstand a summary judgment motion, a claimant need only

demonstrate an intentional [and unjustified act of] interference with the business

relationship which results in damage to the plaintiff.” St. Onge Livestock Co. v.

Curtis, 2002 S.D. 102, ¶ 12, 650 N.W.2d 537, 541 (citation modified).

[¶72.] Here, the undisputed material facts show that the plaintiffs were in a

business relationship with Blueprint, that TCU knew of this relationship, and that

TCU brought that business relationship to a close by purchasing the plaintiffs’

membership interests. The essence of the plaintiffs’ claim is that TCU, through

Stevens, interfered with the plaintiffs’ business relationship with Blueprint by

threatening to “blow-up” Blueprint rather than negotiate the sale price of the

plaintiffs’ shares. But these negotiations took place after the plaintiffs expressed an

interest in selling their shares to TCU. As such, TCU’s negotiation tactics—even if

heavy handed—cannot qualify as an act of interference. If the law permitted such

claims, a seller of corporate equity interest could sue the buyer for interference with

business relations every time they left the bargaining table feeling like they made a

bad bargain.

[¶73.] Furthermore, to “prevail on a claim of tortious interference, there must

be a triangle—a plaintiff, an identifiable third party who wished to deal with the

plaintiff, and the defendant who interfered with the contractual relations.” Gruhlke

v. Sioux Empire Fed. Credit Union, Inc., 2008 S.D. 89, ¶ 7, 756 N.W.2d 399, 404

(emphasis added) (citation modified). “A third party is an indispensable element in

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the tort of intentional interference with contractual relations.” Id. ¶ 13, 756 N.W.2d

at 406.

[¶74.] And here, the facts do not support the presence of a third party.

Although Stevens worked for Blueprint as an operations manager, he negotiated

the membership interest buyout as an agent of TCU. As the circuit court pointed

out, TCU is not a third party that could have interfered with its own interests in

acquiring additional shares, nor is Blueprint capable of tortiously interfering with

the restructuring of its own ownership. The court properly granted summary

judgment in the defendants’ favor on the plaintiffs’ tortious interference claim.

Shareholder oppression

[¶75.] The plaintiffs also allege that Stevens’s threat to blow up the business

rather than negotiate the membership share price constitutes shareholder

oppression. Generally, shareholder oppression occurs when the “majority

shareholders breach[] their fiduciary duties by actions or conduct constituting

‘oppression’ of the minority shareholders.” 18A Am. Jur. 2d Corporations § 641,

Westlaw (database updated Nov. 2025). Whether a party’s conduct constitutes

shareholder oppression is a question of law. Mueller, 2002 S.D. 38, ¶ 11, 643

N.W.2d at 62.

[¶76.] We have previously defined a shareholder’s conduct as oppressive if it

“substantially defeats the reasonable expectations held by minority shareholders in

committing their capital to the particular enterprise.” Id. ¶ 13 (citation modified).

“Oppression will only arise where the minority shareholder’s expectations were both

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reasonable under the circumstances and were central to the decision to join the

venture.” Id. ¶ 14, 643 N.W.2d at 63 (citation modified).

[¶77.] A shareholder’s expectations “are to be analyzed in light of the entire

history of the parties’ relationship, and include expectations such as participation in

management of corporate affairs.” Id. at 62 (citation omitted). We use a balancing

test to determine “whether a [shareholder’s] expectations are reasonable.” Id. at 63.

Under this test, “[t]he court weighs the minority shareholder’s expectations against

the corporation’s ability to exercise its business judgment and run its business

efficiently.” Id. (citation modified). “There is a presumption that directors will

make decisions ‘on an informed basis, in good faith, and in the honest belief that the

action taken was in the best interests of the company.’” Id. (quoting Whalen v.

Connelly, 593 N.W.2d 147, 154 (Iowa 1999)).

[¶78.] The plaintiffs’ shareholder-oppression claim faces two apparent and

insurmountable hurdles. First, the plaintiffs are not minority shareholders. Gulf

Coast, Trigger, and TCU all owned one-third shares in Blueprint. Both Gulf Coast

and Trigger wanted to sell their interests, and they were both negotiating with TCU

to do so. As such, the plaintiffs were, in effect, negotiating together as majority

shareholders to sell their membership interests. Because the plaintiffs were not

minority shareholders, they cannot maintain a suit for minority shareholder

oppression.

[¶79.] Second, the only expectation discussed by Gulf Coast or Trigger was

the inclusion of a “true-up” price adjustment in the Purchase Agreement. But, for

the reasons expressed above in our economic duress discussion, they have not

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demonstrated how their expectation of receiving a “true-up” was “central to [their]

decision to join the venture.” Id.

[¶80.] And even if we interpreted the plaintiffs’ argument broadly to state a

more abstract claim that obtaining a return on their initial investment was central

to their decision to invest in Blueprint, the plaintiffs are not claiming that they did

not profit from their initial investment. The sole basis for this suit is that they

might have profited more had Stevens been more flexible in his negotiation

tactics.16 The undisputed facts present here, however, do not constitute

shareholder oppression.

Unjust enrichment/usurpation

[¶81.] The plaintiffs also assert an unjust enrichment claim against Stevens

and TCU based on their alleged usurpation of the plaintiffs’ “opportunity to have all

or part of their membership [interests] bought out at a market rate.” The plaintiffs

contend that Stevens “orchestrated a backroom deal with Galles, without revealing

the details, by [usurping] the benefits of the gap between buying Trigger[’s] and

Gulf Coast’s shares for $1.6 million, and reselling a portion of them to Galles for

$2.5 million, while [retaining] the remaining 16.6% of the shares.”

[¶82.] The circuit court granted summary judgment in the defendants’ favor

after concluding that “[t]he equitable remedy of unjust enrichment does not apply.”

16. The amount of the capital contributions for Gulf Coast and Trigger, if any, is unclear. The Operating Agreement states that the members’ capital contributions are listed on an attached exhibit, but that exhibit lists no contributions for either Gulf Coast or Trigger. When the topic was raised at his deposition, Keogh indicated that Gulf Coast had contributed “debt,” but, in context, this seems to be a reference to the financing role of the affiliated company, Aladdin.

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The court further determined that the plaintiffs’ usurpation claim failed as a matter

of law because the plaintiffs voluntarily entered into a contract to sell their shares

“for a different price.”

[¶83.] First, we agree that the doctrine of unjust enrichment does not apply

here. “Unjust enrichment occurs when one confers a benefit upon another who

accepts or acquiesces in that benefit, making it inequitable to retain that benefit

without paying.” Langbehn, 2025 S.D. 11, ¶ 49, 18 N.W.3d at 647 (citation

modified). “A party alleging unjust enrichment must show that the other party both

received and knew he was receiving a benefit. Additionally, it must be inequitable

to allow the enriched party to retain the benefit without paying for it.” Id. (citation

omitted). But “[u]njust enrichment contemplates an involuntary or nonconsensual

transfer, unjustly enriching one party.” Johnson v. Larson, 2010 S.D. 20, ¶ 8, 779

N.W.2d 412, 416.

[¶84.] “[T]he equitable remedy of unjust enrichment is unwarranted when

the rights of the parties are controlled by an express contract.” Id. (citation

omitted). “In the contract framework, benefits are voluntarily conferred and

transfers are consensual.” Id. ¶ 9. Thus, “[w]hen there is a valid and enforceable

contract,” as there is here, “liability for compensation or other resolution of the

breach is fixed exclusively by the contract.” Id. (collecting cases).

[¶85.] We have held above that the plaintiffs entered a valid and enforceable

contract, free of coercion and economic duress. As a part of the Purchase

Agreement, the plaintiffs voluntarily and consensually transferred their respective

shares in Blueprint to TCU in exchange for $800,000 per share. Even though the

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defendants may have turned around and sold those shares for more than they paid,

the plaintiffs cannot, on that basis alone, claim that the transfer was non-

consensual or unjust. The plaintiffs received exactly what they bargained for.

[¶86.] Second, the defendants did not usurp a business opportunity. The

plaintiffs appear to couch this claim under the rubric of the doctrine of corporate

opportunity. This “doctrine holds that one who occupies a fiduciary relationship to

a corporation may not acquire, in opposition to the corporation, property in which

the corporation has an interest or tangible expectancy.” Case v. Murdock, 488

N.W.2d 885, 890 (S.D. 1992).

If the doctrine of business opportunity is to possess any vitality, the corporation or association must be given the opportunity to decide, upon full disclosure of the pertinent facts, whether it wishes to enter into a business that is reasonably incident to its present or prospective operations. Since a director is under a duty to inform the corporation of the full circumstances of the transaction, mere disclosure of the transaction, without revealing the surrounding circumstances, is not sufficient, and it has been held that the failure to make complete disclosure constitutes constructive fraud . . . .

Id. (quoting 3 Fletcher Cyc. of Corp., § 861.1 (1986)).

[¶87.] But here, there was no business opportunity to usurp. The members

were negotiating to restructure Blueprint’s ownership, not acquiring an interest in

property in which Blueprint had a tangible expectancy.17 And as part of the LOI,

17. Section 10.5(d)(1) of the Operating Agreement also states that “[n]o opportunity shall constitute a ‘company opportunity’ for purposes of § 409(b)(1) of the Act unless it is specifically identified as a company opportunity in writing by the Manager.” And the plaintiffs have not, as part of their usurpation argument, provided any record of a “writing by the Manager” identifying the conduct of which they complain as a business or company opportunity.

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the plaintiffs assented to an “Exclusivity” clause, whereby they agreed not to

“initiate, solicit, entertain, negotiate, accept, or discuss, directly or indirectly, any

proposal or offer from any person or group of persons other than [TCU] . . . to

acquire all or any significant part of . . . [the] membership interests.” So, to the

extent there was another business opportunity, the plaintiffs voluntarily agreed not

to pursue it. The plaintiffs were also aware, at least in general terms, since

February 2019 that TCU needed outside investors to make the ownership

restructuring feasible. Thus, the circuit court properly granted summary judgment

in the defendants’ favor on the unjust enrichment/usurpation claim.

Accounting, costs and attorney fees, and injunctive relief

[¶88.] Because we affirm the circuit court’s entry of summary judgment, the

plaintiffs’ claims for accounting, costs and attorney fees, and injunctive relief are

rendered moot. See Netter v. Netter, 2019 S.D. 60, ¶ 9, 935 N.W.2d 789, 791 (“The

Court will generally not rule on an issue if a decision will have no practical legal

effect upon an existing controversy.” (citation modified)).

Conclusion

[¶89.] For the reasons explained above, we affirm the circuit court’s grant of

summary judgment in the defendants’ favor on each of the plaintiffs’ claims.

[¶90.] JENSEN, Chief Justice, and DEVANEY and MYREN, Justices, and

KERN, Retired Justice, concur.

[¶91.] GUSINSKY, Justice, not having been a member of the Court at the

time this action was considered by the Court, did not participate.

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