Court of Appeals of Missouri, Eastern District, Third Division
JOAN L. ROBINSON, Respondent/Cross-Appellant,
JOHN F. LANGENBACH, JUDY LANFRI f/k/a JUDY LONGBROOK, and PERMA-JACK COMPANY, Appellants/Cross-Respondents.
from the Circuit Court of St. Louis County 12SL-CC02302-01
Honorable Kristine Allen Kerr
these consolidated appeals following a bifurcated civil suit
for damages and equitable relief, John F. Langenbach
("Langenbach"), Judy Lanfri f/k/a/ Judy Longbrook
("Lanfri"), and Perma-Jack Company
("PJC") (together, "Appellants") appeal
from both the trial court's entry of judgment pursuant to
a jury verdict awarding damages to Joan L. Robinson's
("Robinson") on her claim for breach of fiduciary
duty, and from the trial court's judgment after a bench
trial awarding Robinson equitable relief on her claim of
shareholder oppression. Likewise, Robinson appeals from the
trial court's judgment determining the value of her stock
in her shareholder oppression claim, and from the trial
court's judgment granting Appellants' counterclaim
for injunctive relief to remove signage bearing the PJC
trademark from her property, denying pre-judgment interest on
the stock award, and denying her request for attorneys'
fees. We affirm.
case is before this Court for the second time. We previously
summarized the factual background as follows. In 1975, George
Langenbach incorporated PJC, a franchisor of a foundation
steel-piering system. Robinson, Langenbach, and Lanfri are
George Langenbach's children. In 1988, Robinson,
Langenbach, and Lanfri were named as the company's three
directors and granted shares of the company in equal
portions. Robinson v. Lagenbach,  439 S.W.3d 853,
855 (Mo. App. E.D. 2014) ("Robinson I").
Before June 20, 2012, Robinson served as president and
treasurer of PJC, and Langenbach served as vice president and
secretary. Lanfri had no role in the day-to-day operations of
PJC. Id. Differences developed among the parties
concerning the management and direction of the company, and
Langenbach asked Robinson to resign, but she refused. At a
special meeting of the Board of Directors ("the
Board") on June 20, 2012, Langenbach and Lanfri voted to
remove Robinson as president and treasurer of PJC. Her
employment was terminated on that date. Langenbach and Lanfri
then voted to appoint Langenbach as president. The Board
later appointed Langenbach's daughter Jessica Langenbach
as secretary of PJC, and PJC later hired Langenbach's
other daughter Alexis Langenbach on a part-time basis.
Robinson I, Robinson sued the Appellants for breach
of fiduciary duty and for dissolution of the company or other
equitable relief based on shareholder oppression. The trial
court granted the defendants' motion for summary
judgment, and denied Robinson's motion for partial
summary judgment without issuing findings of fact or
conclusions of law. Id. at 855-56. On appeal, this
Court held that, as a two-thirds majority of the Board,
Langenbach and Lanfri had the authority to vote to remove
Robinson as president and treasurer of PJC, and this
authority was not impacted by the voting trust. However, we
also held the trial court erred in granting summary judgment
on the issues of shareholder oppression, breach of fiduciary
duty by Langenbach and Lanfri as directors and controlling
shareholders, and application of the business-judgment rule
because there remained disputed issues of material fact.
Id. at 858-61.
remand, Robinson filed a Third Amended Petition for Equitable
Relief and Damages against Appellants, asserting (1)
shareholder oppression and (2) breach of the fiduciary duty
owed by Langenbach and Lanfri, as Directors and shareholders
in control of PJC, to Robinson, individually, as the minority
shareholder, by terminating her employment with
PJC.With her Third Amended Petition, she filed
a motion for separate trials to bifurcate her equitable
action for shareholder oppression, which would be determined
by the trial court, from the action for damages on the claim
for breach of fiduciary duty, which would be determined by a
jury. The trial court granted the motion for separate trials.
pleaded multiple affirmative defenses, including, as relevant
on appeal, that (1) Robinson failed to allege the elements of
shareholder oppression; (2) her allegations were barred by
the business judgment rule because Langenbach and Lanfri both
acted with the honest belief that their actions were in the
best interest of PJC; (3) Langenbach and Lanfri had the
authority to terminate Robinson's employment whenever in
their judgment the best interests of PJC would be served; and
(4) she had no right to continued employment based on her
status as a shareholder, but rather, as determined in
Robinson I, Langenbach and Lanfri had the authority
to terminate her. As well, Appellants filed a counterclaim
for injunctive relief, alleging Robinson had refused to
remove a Perma-Jack sign from the former location of PJC
headquarters at 9052 Watson Road, Crestwood, Missouri
("the Watson Property"), which was owned by NANAPA,
LLC, a limited liability company owned and managed by
Robinson. Appellants asserted this refusal constituted an
infringement on PJC's trademark and false designation of
origin under 15 U.S.C. § 1051 et seq. and Section
417.010 et seq., in that Robinson's continued use of the
sign caused confusion for PJC's clients and customers and
damaged the reputation and image of PJC in the community.
the February 2017 jury trial on the breach-of-fiduciary-duty
claim, Appellants filed a motion in limine to preclude
Robinson from arguing or introducing evidence that, as
relevant to this appeal, the salaries paid to Langenbach and
his daughters, Jessica and Alexis, were too high or should be
different. The trial court denied the motion in limine on
this ground. The parties proceeded to trial on Robinson's
claim for breach of fiduciary duty by Langenbach and Lanfri
against her as a stockholder. At the close of Robinson's
evidence, Appellants moved for a Directed Verdict, which the
trial court denied.
close of trial, the jury was instructed to find in favor of
Robinson if it believed:
First, defendants John Langenbach and Judy Lanfri removed
plaintiff Joan Robinson from Perma-Jack Company; and
Second, defendants John Langenbach and Judy Lanfri did not
believe, in good faith, that their removal of plaintiff Joan
Robinson was in the best interests of the company; and
Third, plaintiff Joan Robinson was thereby damaged.
jury returned a verdict in favor of Robinson and against
Langenbach and Lanfri, and it awarded her $390, 000.00. On
February 16, 2017, the trial court entered judgment in
accordance with the jury verdict.
filed a motion to dismiss, vacate, or set aside the judgment
and a motion for judgment notwithstanding the verdict
("JNOV"), and they also moved for a new trial,
asserting that the trial court erred in admitting certain
evidence and that the jury's verdict was against the
weight of the evidence. Robinson opposed the motions, and the
trial court denied Appellants' motions.
October 26 and November 1, 2017, the trial court held a bench
trial on Robinson's equitable claim for shareholder
oppression, and on Appellants' equitable claim requesting
Robinson remove a sign bearing the PJC trademark from the
Watson property. The trial court issued a Memorandum, Order
and Judgment on February 13, 2018, concluding Appellants'
termination of Robinson constituted shareholder oppression,
and their actions were not shielded by the business judgment
rule because the actions were not conducted in good faith.
For its remedy, the trial court ordered Langenbach and Lanfri
to purchase Robinson's shares of PJC stock for $59,
000.00, plus post-judgment interest at the rate of 9% per
annum from the date of the February 13, 2018 judgment;
however, the trial court denied Robinson's request for
attorneys' fees and for equitable relief to compensate
her for PJC's indemnification of Langenbach and
Lanfri's attorneys' fees. On Appellants'
counterclaim, the trial court ordered Robinson to remove
within 30 days any signage bearing the PJC trademark.
Robinson moved to amend the judgment to include pre-judgment
interest at the rate of 9% per annum from the date of June
20, 2012, the date of Robinson's termination. The trial
court denied Robinson's request for pre-judgment
appealed, arguing the trial court erred in denying their
motion for directed verdict and their motion for JNOV after
the February 2017 jury verdict, because they were entitled to
judgment as a matter of law on their affirmative defenses
that Robinson's status as a shareholder provided no
fiduciary-rooted right to continued employment; the trial
court abused its discretion in admitting evidence of the
salaries of Langenbach, Jessica Langenbach, and Alexis
Langenbach; and the trial court erred in finding shareholder
oppression after the October/November 2017 bench
Robinson appealed, arguing the trial court erred in
determining the value of her shares of PJC stock by applying
both a marketability discount and a minority discount; the
trial court abused its discretion in using June 20, 2012, as
the valuation date for the PJC stock; the trial court erred
in failing to award her pre-judgment interest; the trial
court erred in denying Robinson equitable relief for
PJC's indemnification of Appellants' defense costs
and in denying her request for attorneys' fees; and,
finally, the trial court erred in ordering her to remove
signage bearing the PJC trademark. These appeals were
consolidated before this Court.
Appeal No. ED106781
Points I and II
Appellants' first and second points on appeal, they argue
the trial court erred in denying their motion for directed
verdict and JNOV because they were entitled to judgment as a
matter of law on their affirmative defense that
Robinson's status as a shareholder did not entitle her to
continued employment nor did her shareholding interest give
rise to a fiduciary-based right to employment. We disagree.
review here is limited to whether Robinson made a submissible
case. Delacroix v. Doncasters, Inc., 407 S.W.3d 13,
26 (Mo. App. E.D. 2013) (en banc). To make a submissible
case, each element of a plaintiff's case must be
supported by substantial evidence. Keveney v. Mo.
Military Acad., 304 S.W.3d 98, 104 (Mo. banc 2010).
Substantial evidence is evidence that, if true, would allow
the trier of fact to reasonably decide the case. Williams
v. Trans States Airlines, Inc., 281 S.W.3d 854, 866 (Mo.
App. E.D. 2009). We consider the evidence and all reasonable
inferences in the light most favorable to the plaintiff, and
we disregard all contrary evidence and inferences.
Keveney, 304 S.W.3d at 104. We will reverse a
jury's verdict only if there is a "complete absence
of probative facts to support the jury's
here alleged a breach of the fiduciary duty owed by
Langenbach and Lanfri, as Directors and shareholders in
control of PJC, to Robinson, individually, as the minority
shareholder, by terminating her employment with PJC. To
prevail on a claim of breach of fiduciary duty, a plaintiff
must show: (1) the existence of a fiduciary duty; (2) a
breach of that fiduciary duty; (3) causation; and (4) harm.
Brown v. Brown, 530 S.W.3d 35, 41 (Mo. App. E.D.
2017). Whether a fiduciary duty exists between parties is a
question of law, and whether a breach of that duty occurred
is a question for the fact-finder to decide. Western Blue
Print Co. v. Roberts, 367 S.W.3d 7, 15 (Mo. banc 2012).
Thus, here, Robinson had to produce evidence that Appellants
owed her a fiduciary duty, they breached that duty, and the
breach caused her harm.
parties agree that officers and directors of a corporation
have a fiduciary relationship with both the corporation and
with the stockholders, which requires them "to exercise
the utmost good faith in the discharge of the duties arising
out of their trust, and to act for the corporation and its
stockholders, giving all the benefit of their best
judgment." Waters v. G & B Feeds, Inc., 306
S.W.3d 138, 146 (Mo. App. S.D. 2010) (citation omitted).
Further, officers of a closely held corporation owe an even
higher degree of fiduciary duty to shareholders than do their
counterparts at public corporations. Id. at 146-47.
Thus, substantial evidence supported a finding of a fiduciary
duty by Langenbach and Lanfri to Robinson. Likewise, there is
no question that the Board's termination of Robinson as
president and treasurer of PJC caused her harm. The question
for this Court on appeal is whether Langenbach and Lanfri
breached their fiduciary duty to Robinson as a shareholder by
terminating her employment.
in Langenbach and Lanfri's fiduciary duty to PJC and its
stockholders, including Robinson, was to run PJC in
accordance with its bylaws. See Western Blue Print
Co., 367 S.W.3d at 15 (fiduciary duty of officers and
directors is to exercise good faith "when using the
powers conferred upon them"); Gieselmann v.
Stegeman, 443 S.W.2d 127, 136 (Mo. 1969) (company
vice-president and shareholder violated fiduciary duty to
other shareholders by not exercising powers conferred upon
him in good faith and by seeking to personally profit at
expense of other shareholders). Here, Article IV, Section 2
of PJC's bylaws provided that "[a]ny officer or
agent appointed by the Board of Directors may be removed by
the Board of Directors whenever in the judgment of the Board
the best interests of the corporation will be served
thereby." Accordingly, the Board has a fiduciary
duty to the corporation and the shareholders, including
Robinson, to apply the bylaws, which in turn mandate that any
removal of an officer must be predicated upon the Board's
judgment that the removal will serve the best interests of
the corporation. Whether a breach of an established fiduciary
duty occurred is a question of fact for the jury to decide.
See Western Blue Print Co., 367 S.W.3d at 15.
Therefore, there was no error in the trial court's
decision denying the motion for direct verdict and submitting
this issue to the jury.
we note that although Langenbach and Lanfri's fiduciary
duty was to all shareholders, because Robinson was uniquely
harmed by her termination, her individual suit could proceed.
Nickell v. Shanahan, 439 S.W.3d 223, 227 (Mo. banc
2014) ("[i]ndividual actions are permitted, and provide
the logical remedy, if the injury is to the shareholders
themselves directly, and not to the corporation")
(citation omitted); see also Gieselmann, 443 S.W.2d
at 131 (shareholders could maintain individual suit against
directors or officers where they asserted wrongdoers seized
control of corporation from complaining stockholders by
the trial court did not err in denying JNOV on the issue of
whether Appellants were entitled to their affirmative
defenses that Robinson's status as a shareholder did not
entitle her to continued employment or that her shareholder
interest did not give rise to a fiduciary-based right to
employment. These affirmative defenses mistake the issue.
Robinson's right to present to the jury her claim of
breach of fiduciary duty was not based in her right to
continued employment due to her status as a shareholder.
Rather, her claim is based in the Board's failure to
comply with the bylaws, which, under controlling Missouri
law, they have a fiduciary duty to the corporation and to the
shareholders, including Robinson, to follow. We need not,
therefore, address Appellants' argument whether to apply
the case law of a minority of non-Missouri jurisdictions that
a plaintiff's shareholder status does not give rise to a
fiduciary-based right to employment for shareholders who are
also at-will employees, see, e.g., Ingle v.
Glamore Motor Sales, Inc., 535 N.E.2d 1311, 1312-13
(N.Y. App. 1989); and whether to apply the case law of a
majority of non-Missouri jurisdictions that the fiduciary
duty of majority shareholders towards minority shareholders
regarding termination from employment stems from their duty
to protect the investment of the minority shareholders,
see, e.g., Hollis v. Hill, 232 F.3d 460,
470-71 (5th Cir. 2000). The outcome here is not decided by
the issues raised in the cases cited by Appellants.
Board did not have an unfettered right to terminate Robinson,
they could only terminate her in accordance with their
fiduciary duty to follow PJC's bylaws, and whether they
did so is a question of fact for the jury to decide.
See Western Blue Print Co., 367 S.W.3d at
15; see also Robinson I, 439 S.W.3d at 860
(reversing for further proceedings after holding that the
question of whether Board's action violated its fiduciary
duty to Robinson as minority shareholder required factual and
credibility determinations by fact-finder). PJC's bylaws
stated that any officer could be removed by the Board of
Directors "whenever in the judgment of the Board the
best interests of the corporation shall be served
thereby." Robinson presented evidence at trial in
support of her assertion that Langenbach and Lanfri did not
believe in good faith that the best interest of PJC would be
served by her termination, and the jury believed her
evidence, as is their right. "The jury is the sole judge
of credibility of witnesses and the weight and value of their
testimony and may believe or disbelieve any portion of that
testimony." Keveney, 304 S.W.3d at 105
(citation omitted). On review, we consider the evidence in
the light most favorable to the verdict and will not reverse
unless there is a "complete absence of probative facts
to support the jury's conclusion." Id. at
104. Under our standard of review, Robinson made a
submissible case, and thus the trial court did not err in
denying Appellants' motion for JNOV.
Points I and II are denied.
their third point on appeal, Appellants argue the trial court
abused its discretion in admitting evidence of the salaries
of Langenbach, Jessica Langenbach, and Alexis Langenbach
after Robinson's termination because they were not
relevant to Robinson's claims but served only to
prejudice and inflame the jury. We disagree.
court has broad discretion in deciding whether to admit or
deny evidence at trial, and we review merely for an abuse of
that broad discretion, giving great deference to the trial
court's evidentiary rulings. Williams, 281
S.W.3d at 872. An abuse of discretion occurs when the ruling
is so against the logic of the circumstances, and is so
arbitrary and unreasonable as to shock the sense of justice
and indicate a lack of careful consideration. Id.
Our review is for prejudice, not mere error, and we will
reverse only if the appellant demonstrates that the error was
so prejudicial as to deprive him or her of a fair trial and
there was a reasonable probability the trial court's
ruling affected the outcome of the trial. Id.;
see also State v. Anderson, 76 S.W.3d 275, 277 (Mo.
must be both logically and legally relevant to be admissible.
Wilson v. Union Pac. R.R. Co., 509 S.W.3d 862, 874
(Mo. App. E.D. 2017). "Evidence is logically relevant if
it tends to make the existence of a material fact more or
less probable than it would be without the evidence."
Id. Likewise, evidence is legally relevant when the
probative value of the evidence outweighs its costs, such as
unfair prejudice, confusion of the issues, misleading the
jury, undue delay, waste of time, or cumulativeness.
Id.; Anderson, ...