White v. Pitman

2020 Ohio 3957, 156 N.E.3d 1026
CourtOhio Court of Appeals
DecidedAugust 5, 2020
DocketC-190441
StatusPublished
Cited by24 cases

This text of 2020 Ohio 3957 (White v. Pitman) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
White v. Pitman, 2020 Ohio 3957, 156 N.E.3d 1026 (Ohio Ct. App. 2020).

Opinion

[Cite as White v. Pitman, 2020-Ohio-3957.]

IN THE COURT OF APPEALS FIRST APPELLATE DISTRICT OF OHIO HAMILTON COUNTY, OHIO

BRYAN WHITE, APPEAL NO. C-190441 : TRIAL NO. A-1901247 COOL COUNTRY CORPORATION, O P I N I O N. and :

TUPPER PLAINS INVESTMENTS, LLC, :

Plaintiffs-Appellants, : vs.

AARON PITMAN, :

API DOMAIN CAPITAL, LLC, : RA DOMAIN CAPITAL, LLC,

HP INSURANCE GROUP, INC., :

AUTOINSURANCENOW, LLC, : PERSONALINJURY.ORG, LLC,

COOL COUNTRY GROUP, LLC, :

and : RYAN GOLDSCHMIDT,

Defendants-Appellees. : OHIO FIRST DISTRICT COURT OF APPEALS

Civil Appeal From: Hamilton County Court of Common Pleas

Judgment Appealed From Is: Affirmed in Part, Reversed in Part, and Cause Remanded

Date of Judgment Entry on Appeal: August 5, 2020

Carlile Patchen & Murphy, LLP, Matthew S. Brown and Joseph M. Patchen, for Plaintiffs-Appellants,

Graydon Head & Ritchey LLP and Daniel J. Knecht, for Defendants-Appellees Aaron Pitman, API Domain Capital, LLC, HP Insurance Group, Inc., AutoinsuranceNow, LLC, Personalinjury.org, LLC, and Cool Country Group, LLC,

Murphy Landen Jones PLLC and Michael S. Jones, for Defendants-Appellees Ryan Goldschmidt and RA Domain Capital, LLC.

2 OHIO FIRST DISTRICT COURT OF APPEALS

MYERS, Presiding Judge.

{¶1} Plaintiffs-appellants Bryan White, Cool Country Corporation, and

Tupper Plains Investments, LLC, appeal from the trial court’s entry granting the

Civ.R. 12(B)(6) motion to dismiss filed by defendants-appellees Aaron Pitman, API

Domain Capital, LLC, HP Insurance Group, LLC, AutoinsuranceNow, LLC, Cool

Country Group, LLC, Personalinjury.org, LLC, Ryan Goldschmidt, and RA Domain

Capital, LLC.

{¶2} We hold that the trial court properly dismissed the plaintiffs’ asserted

claim of piercing the corporate veil. But because the trial court failed to accept all

allegations in the plaintiffs’ complaint as true when finding that previously executed

releases barred all claims in the complaint, and because it erred in determining that

the plaintiffs failed to plead their fraud claim with particularity, we hold that the trial

court erred in granting the motion to dismiss with respect to the remaining claims,

and we reverse its judgment in part.

Factual and Procedural Background

{¶3} Pitman, who is engaged in the business of acquiring, developing, and

selling internet domain names, approached White regarding White’s investment in

various internet-domain-related investments. According to the complaint, Pitman

proposed that White invest in various entities, and that Pitman utilize his experience

to acquire, develop, market, and ultimately sell the purchased domain names for a

profit. White relied on Pitman to identify the domains to purchase, with the belief

that the domain names would be purchased from disinterested third parties and that

3 OHIO FIRST DISTRICT COURT OF APPEALS

any subsequent sales of the domain names would be arms-length transactions.

White and Pitman engaged in the following transactions:

1. White invested $125,000 in AutoinsuranceNow, LLC. As set forth

in the operating agreement of AutoinsuranceNow, LLC, White’s

company, Cool Country Corporation, owned 40 percent of the

entity, while API Domain Capital, LLC, which was solely owned by

Pitman, owned 60 percent of the entity.

2. White invested $50,000 in Personalinjury.org, LLC. As set forth in

the operating agreement of Personalinjury.org, LLC, White’s

company Tupper Plains Investments, LLC, owned 40 percent of the

entity, and API Domain Capital, LLC, owned 60 percent.

3. White invested $200,000 in Digital Asset Brokerage Group, LLC.

As set forth in the parties’ joint venture agreement, White was to

personally own 10 percent of this entity, and HP Insurance Group,

LLC, was to own 90 percent.

4. White invested $750,000 in Dependent.com, LLC. The parties

formed Cool Country Group, LLC, to hold this domain name.

White’s company Cool Country Corporation owned 50 percent of

Cool Country Group, LLC, and RA Domain Capital, LLC, owned the

other 50 percent.

{¶4} The parties subsequently entered into a partial buyback1 of White’s

company Cool Country Corporation’s shares in Cool Country Group, LLC. For

1 The parties refer to this transaction as a buyback agreement. The transaction in fact involves a sale of shares, rather than a buyback, because R.A. Domain Capital, LLC, and API Domain Capital, LLC, did not own the shares prior to Cool Country Corporation’s initial purchase of them.

4 OHIO FIRST DISTRICT COURT OF APPEALS

$30,000, R.A. Domain Capital, LLC, and API Domain Capital, LLC, purchased a

portion of Cool Country Corporation’s shares in the entity. As part of the agreement,

the parties executed a mutual release of claims. This release provided in relevant

part that:

In exchange for and in consideration of the promises contained in this

Agreement, Seller [Cool Country Corporation] and Bryan White, being

the sole shareholder and director of Seller, on behalf of themselves and

on behalf of their respective, heirs, successors, representatives, agents,

assigns, next of kind, members and affiliates (the “Seller Releasing

Parties”) hereby fully, finally, and forever release, acquit, and

discharge the Company, RA Domain, Ryan Goldschmidt, being the

sole member of RA Domain, API Domain, Aaron Pitman, being the

sole member of API Domain, and their respective affiliates, officers,

directors, managers, members[,] employees, attorneys, agents,

representatives[,] heirs, next of kin, successors and assigns (“Buyer

Released Parties”) from any and all claims, causes of action, sums of

money, accounts, demands, losses, damages, liabilities, judgments and

executions of whatever kind or nature, whether known or unknown,

direct or indirect, absolute or contingent, or suspected or unsuspected,

whether the same be in administrative proceedings, in arbitration or

other, at law, in equity or mixed, which the Seller Releasing Parties

ever had, now have, or hereafter may have against any of the Buyer

Released Parties prior to the execution of this Agreement.

5 OHIO FIRST DISTRICT COURT OF APPEALS

{¶5} Pitman, through his company API Domain Capital, LLC, additionally

purchased all of White’s company Cool Country Corporation’s shares in

AutoinsuranceNow, LLC, for $62,500. This sale agreement also contained a

similarly worded mutual release of claims.2

{¶6} Approximately two years after these buyback agreements were

executed, the plaintiffs filed a complaint in Athens County, Ohio against Pitman and

the other defendants. The complaint alleged that Pitman induced White to invest in

the transactions set forth above by holding himself out as an expert in the field of

domain-name investment. Pitman solicited White to invest by representing that the

sellers of the domain names they would purchase together were bona fide,

disinterested third-parties and that subsequent sales of the domain names would be

arms-length transactions, and by promising that White would receive a high rate of

return on his investments.

{¶7} The complaint set forth the domain purchases described above and

alleged that Goldschmidt and Roderick Hammons, who were the owners of the

domain names prior to White and his companies’ purchase of them, assisted Pitman

in his efforts to defraud White.

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Bluebook (online)
2020 Ohio 3957, 156 N.E.3d 1026, Counsel Stack Legal Research, https://law.counselstack.com/opinion/white-v-pitman-ohioctapp-2020.