Minority shareholder oppression; Business Corporation Act (BCA); MCL 450.1489; Statute of limitations; Estes v Idea Eng’g & Fabrications, Inc; Res judicata; Breach of fiduciary duty; Spoliation; Equitable remedy; Stock purchase at fair value; Madugula v Taub; Franks v Franks’ Attorney fees; American Rule

The court held that the trial court properly applied the six-year statute of limitations and granted plaintiff equitable relief on his minority shareholder oppression claim, but did not err by directing a verdict on his breach-of-fiduciary-duty claim or denying attorney fees. Plaintiff remained a shareholder of defendant-corporation (J & J) after prior litigation established that the parties’ redemption agreement had not been followed. The court first held that res judicata did not bar plaintiff’s BCA claims because they “arose after this Court issued the Turner II decision,” and no prior court had addressed “the merits of plaintiff’s contentions regarding defendants’ violation of the BCA.” The court next held that plaintiff sufficiently pled and supported shareholder oppression because he alleged and produced evidence that defendants refused to recognize his shareholder status, denied access to corporate records, failed to redeem his shares, and manipulated or hid J & J’s finances. It also upheld the directed verdict on breach of fiduciary duty because, even assuming a breach, the lack of financial records created a “six-year evidentiary gap,” leaving no non-speculative basis for damages. As to the shareholder-oppression remedy, noting there was no binding precedent as to the amended statute, the court held that the six-year residual limitations period applied to equitable relief under MCL 450.1489(1)(a)-(e), while the shorter limitations period in MCL 450.1489(1)(f) applied only to damages. Relying on Madugula, the court explained that a forced stock buyout is equitable because it requires the court “to compel a party to purchase shares.” The court further held that the valuation remedy was within the trial court’s discretion because defendants’ “‘massive and entirely successful campaign of spoliation’” made valuation nearly impossible, and the trial court reasonably used the only uncontroverted evidence of stock value: plaintiff’s $25,000 cash purchase price, plus 7% simple interest. Finally, the court held that attorney fees were not warranted under the American Rule because defendants’ conduct, while “less than ideal,” did not fall within the limited fraudulent-or-unlawful-conduct exception. Affirmed.

Employment discrimination; Age discrimination; MCL 37.2202(1)(a); McDonnell Douglas Corp v Green; Prima facie case; Qualification for position; Town v MI Bell Tel Co; Pretext; Bullard-Plawecki Employee Right to Know Act; Personnel file; MCL 423.503 & 423.504; Michigan Department of Insurance & Licensing Services (DIFS)

The court held that the trial court properly granted defendant-employer summary disposition on plaintiff’s age-discrimination and Bullard-Plawecki Act claims. Plaintiff, an insurance producer born in 1952, was terminated after DIFS suspended his insurance license because he failed to complete required continuing-education credits. On appeal, the court first held that plaintiff could not establish a prima facie age-discrimination claim because “there was no genuine issue of material fact that plaintiff was unqualified for his insurance producer position.” Although plaintiff could continue servicing existing policies during the statutory grace period, “he could not ‘solicit or sell’ new policies[,]” and his own testimony showed that his “main job” was to obtain new business and manage it. The court next held that even if plaintiff had met his prima facie burden, defendant offered a legitimate, nondiscriminatory reason for termination because his license was suspended, and he failed to show pretext. His handbook warned that “[f]ailure to maintain a license” could result in termination, and plaintiff offered no evidence that his age was “a motivating factor” rather than that the timing near his 70th birthday was merely coincidental. Finally, the court held that plaintiff’s Bullard-Plawecki Act claim failed because there was no evidence he first requested to review his personnel file in person before asking for a copy, or that he was unable to review it at the employer’s location. The court also rejected his claimed prejudice from delayed production because the Act allows an employee to review “their own employment record, not other employees’ employment records,” and plaintiff did not identify anything missing from his own file. Affirmed.

Limitations on the scope of voir dire; Ineffective assistance of counsel; Failure to raise a futile objection; Request for remand for an evidentiary hearing; Sentencing; OV 13 scoring; MCL 777.43(1)(c) & (2)(a); Distinction between acquitted conduct & uncharged conduct; People v Beck; People v Boukhatmi; Rational-jury analysis; People v Brown

The court held that the trial court did not err in limiting the scope of voir dire, and that defense counsel was not ineffective for failing to raise a futile objection. It also upheld the trial court’s scoring of 25 points for OV 13 in sentencing defendant for his CSC II conviction, concluding the trial court properly considered uncharged (not acquitted) conduct. He contended “the trial court limited questions to only the new potential jurors after the first peremptory challenges were made” and that it did so by surprise, without warning. The court disagreed, finding that his argument mischaracterized the record. The “trial court and the parties probed into the potential bias of the initially seated potential jurors. Defendant’s trial counsel even expressed his satisfaction with the voir dire of the initially seated potential jurors. Following a break, the trial court advised the jurors that the ‘initial round of questioning has concluded.’ After jurors were dismissed by the parties for cause or with peremptory challenges, the trial court instructed additional potential jurors to be seated. [It] requested that [they] answer the initial questions that were relevant to them.” This context showed “there was no surprise in the process for questioning jurors. Rather, the procedure was agreed upon[.]” As to defendant’s related ineffective assistance claim, the court reviewed all the information the jurors provided, all the questions they were asked, and concluded that he failed “to identify any additional information that his co-counsel should have asked that would uncover pertinent information regarding juror bias or partiality.” As to OV 13, the “trial court considered three incidents including the event” that was the basis of defendant’s conviction, “‘evidence of sexual touching of the victim’s genitalia and breasts at’” a motel in Kent County, and his “use of a ‘vibrator on the victim at’” a hotel in the county. The victim’s trial testimony supported its “conclusion that these three events were sufficient to establish a pattern. The sexual conduct cited by the trial court did not involve the alleged sexual penetration for which defendant was acquitted.” It also did not include two CSC I charges in another county that were dismissed. Thus, “the evidence the trial court considered as a pattern of three or more crimes against the victim at sentencing was consistent with defendant’s acquittal.” Affirmed.

Resentencing after remand; Mandatory Victim Restitution Act (MVRA); 18 USC § 3663A; USSG § 5E1.1; Whether the government affirmatively waived any request for restitution at the original sentencing hearing; The scope of the remand; United States v Pembrook; The “appellate forfeiture doctrine”; Procedures for imposing restitution; § 3663A(d); FedRCrimP 32; Whether the imposition of restitution was vindictive & violated due process

The court held that the government’s affirmative representation at the original sentencing that it was not seeking restitution did not preclude it from requesting restitution under the MVRA at defendant-Miclaus’s resentencing on remand. Thus, the district court did not plainly err in allowing “the government to raise and seek restitution on remand or in ordering restitution for the first time on resentencing despite the government’s prior position.” But it failed to comply with the MVRA and Rule 32 requirements in the process of imposing restitution. Miclaus was convicted of conspiracy, wire fraud, and aggravated identity theft, among other things. At sentencing, “the district court stated, ‘I don’t think anybody is asking for restitution here,’ to which the government replied ‘No, Your Honor.’” The district imposed a 216-month sentence with no restitution. In a prior appeal, the court affirmed Miclaus’s convictions and remanded for resentencing. The district court determined it was a general remand, and the government asked that Miclaus be held jointly and severally liable with a co-conspirator for $ $853,651.99 in restitution. Miclaus told the district court that he did not object to restitution. He was resentenced to 216 months and restitution of $853,651.99 ordered, for which he was jointly and severally liable with his codefendants. In this appeal, reviewing for plain error, the court noted the circuits are split as to the scope of resentencing remand. The Sixth Circuit follows the majority position—"on a general remand, the district court is free to conduct de novo resentencing and take any evidence and hear any argument that it could have considered originally, including arguments that have been waived or forfeited.” Under Pembrook, “the appellate-forfeiture doctrine applies only to appeals and appellants in a second appeal.” It does not apply to sentencing and resentencing. The court also explained that restitution is mandatory “when a Title 18 offense involves fraud or an identifiable victim suffers pecuniary loss.” Miclaus’s 12 wire fraud convictions triggered it here. But the court held that plain error occurred when no version of his “PSR included information indicating the amount of restitution to be imposed” and he “was not privy to the underlying calculations relied on by the government and the district court.” As a result, while it affirmed the imposition of restitution, it vacated and remanded “for resentencing in conformity with the MVRA and Rule 32’s procedures.” Finally, it rejected his arguments that the imposition of restitution was “presumptively vindictive” and violated due process.

Employment discrimination; Age discrimination; MCL 37.2202(1)(a); McDonnell Douglas Corp v Green; Prima facie case; Qualification for position; Town v MI Bell Tel Co; Pretext; Bullard-Plawecki Employee Right to Know Act; Personnel file; MCL 423.503 & 423.504; Michigan Department of Insurance & Licensing Services (DIFS)

The court held that the trial court properly granted defendant-employer summary disposition on plaintiff’s age-discrimination and Bullard-Plawecki Act claims. Plaintiff, an insurance producer born in 1952, was terminated after DIFS suspended his insurance license because he failed to complete required continuing-education credits. On appeal, the court first held that plaintiff could not establish a prima facie age-discrimination claim because “there was no genuine issue of material fact that plaintiff was unqualified for his insurance producer position.” Although plaintiff could continue servicing existing policies during the statutory grace period, “he could not ‘solicit or sell’ new policies[,]” and his own testimony showed that his “main job” was to obtain new business and manage it. The court next held that even if plaintiff had met his prima facie burden, defendant offered a legitimate, nondiscriminatory reason for termination because his license was suspended, and he failed to show pretext. His handbook warned that “[f]ailure to maintain a license” could result in termination, and plaintiff offered no evidence that his age was “a motivating factor” rather than that the timing near his 70th birthday was merely coincidental. Finally, the court held that plaintiff’s Bullard-Plawecki Act claim failed because there was no evidence he first requested to review his personnel file in person before asking for a copy, or that he was unable to review it at the employer’s location. The court also rejected his claimed prejudice from delayed production because the Act allows an employee to review “their own employment record, not other employees’ employment records,” and plaintiff did not identify anything missing from his own file. Affirmed.

Withholding & cancellation of removal; Whether petitioner established that his life or freedom would be in jeopardy if he was returned to Nigeria; 8 USC § 1231(b)(3)(A); Guzman-Vazquez v Barr; Whether the immigration judge (IJ) could require petitioner to offer “corroborating evidence”; Whether removal would result in “exceptional and extremely unusual hardship” for his children; § 1229b(b)(1)(D)

The court held that a “reasonable trier of fact” could have found that petitioner-Nwosu should have produced “corroborating evidence” to support his allegation that his father was kidnapped. And a “reasonable adjudicator” could determine that he “did not show that his three children would suffer the rare type of hardship that permits cancellation of removal.” Thus, the court denied his petition for review of the denial of his request for withholding of removal and cancellation of removal to Nigeria. He asserted that his father had been kidnapped in Nigeria in 2004, and that his children would suffer if he was removed. The IJ denied his application, finding that he failed to support his kidnapping claim or to show that his partner could not support the children such that they would suffer an “exceptional and extremely unusual hardship.” The Board of Immigration Appeals affirmed. The court agreed that Nwosu did not satisfy § 1231(b)(3)(A)’s requirement that he demonstrate that his life or freedom would be in jeopardy if he was returned to Nigeria. It noted that it was within the IJ’s discretion to require corroborating evidence, as long as the applicant is given an opportunity to explain the absence of the evidence. A “deferential standard” is applied when reviewing the IJ’s decision to require corroborating evidence, and it foreclosed Nwosu’s claim. “A ‘reasonable trier of fact’ could have found (as the immigration judge did) that Nwosu should have produced ‘corroborating evidence’ to support his allegation that individuals kidnapped his father.” He was also given ample opportunity to explain why he lacked that evidence. As for the denial of cancellation of removal, the court applied the “substantial-evidence standard” and held that he failed to show the required level of “hardship to a qualifying relative.” It concluded he only showed his children would suffer from “the types of ‘emotional strains’” common to any removal case, and while he claimed they “will face an ‘uncertain’ future economically[,]” uncertainty was insufficient to show that they “will face an abnormally difficult economic hardship.”

No-fault insurance; PIP benefits; Fraud evidence; Credibility; Jury instructions; Verdict form; Attorney misconduct; Fair trial; Juror dismissal; Outside influence; Mitigation of damages; Mootness; Cumulative error

The court held that plaintiff was not entitled to a new trial after the jury found no cause of action on her no-fault PIP claim. Plaintiff sought PIP benefits after a rear-end accident, but defendant-insurer denied the claim after investigating and alleging fraud related to replacement services. On appeal, the court first held that the trial court did not abuse its discretion by admitting evidence of plaintiff’s alleged fraud because “witness credibility is always relevant,” and the evidence bore directly on her credibility about “the benefits she sought and whether she sustained her injuries because of the accident.” The court also held that the fraud instruction and verdict-form question were proper because defendant maintained that plaintiff’s claims were fraudulent, presented evidence on that theory, and the verdict-form question was limited to household-replacement services at plaintiff’s request. The court further noted that any error would not warrant relief because the jury answered “NO” on the fraud question. The court next held that defense counsel’s trial conduct did not deny plaintiff a fair trial because counsel’s arguments about “track-one” and “track-two” doctors and alleged fraud were “consistent with the evidence presented” and were not merely designed to inflame the jury. The court also held that the trial court did not clearly abuse its discretion by dismissing Juror 4 because the juror disclosed prior treatment at a medical clinic connected to a witness, which was an “outside influence” that could have impeded her ability to serve. Finally, the court held that plaintiff’s mitigation-instruction argument was moot because the jury found she did not suffer an injury arising out of the accident and never reached damages, and that no cumulative-error relief was available because “there can be no cumulative effect where there are no errors.” Affirmed.

Minority shareholder oppression; Business Corporation Act (BCA); MCL 450.1489; Statute of limitations; Estes v Idea Eng’g & Fabrications, Inc; Res judicata; Breach of fiduciary duty; Spoliation; Equitable remedy; Stock purchase at fair value; Madugula v Taub; Franks v Franks’ Attorney fees; American Rule

The court held that the trial court properly applied the six-year statute of limitations and granted plaintiff equitable relief on his minority shareholder oppression claim, but did not err by directing a verdict on his breach-of-fiduciary-duty claim or denying attorney fees. Plaintiff remained a shareholder of defendant-corporation (J & J) after prior litigation established that the parties’ redemption agreement had not been followed. The court first held that res judicata did not bar plaintiff’s BCA claims because they “arose after this Court issued the Turner II decision,” and no prior court had addressed “the merits of plaintiff’s contentions regarding defendants’ violation of the BCA.” The court next held that plaintiff sufficiently pled and supported shareholder oppression because he alleged and produced evidence that defendants refused to recognize his shareholder status, denied access to corporate records, failed to redeem his shares, and manipulated or hid J & J’s finances. It also upheld the directed verdict on breach of fiduciary duty because, even assuming a breach, the lack of financial records created a “six-year evidentiary gap,” leaving no non-speculative basis for damages. As to the shareholder-oppression remedy, noting there was no binding precedent as to the amended statute, the court held that the six-year residual limitations period applied to equitable relief under MCL 450.1489(1)(a)-(e), while the shorter limitations period in MCL 450.1489(1)(f) applied only to damages. Relying on Madugula, the court explained that a forced stock buyout is equitable because it requires the court “to compel a party to purchase shares.” The court further held that the valuation remedy was within the trial court’s discretion because defendants’ “‘massive and entirely successful campaign of spoliation’” made valuation nearly impossible, and the trial court reasonably used the only uncontroverted evidence of stock value: plaintiff’s $25,000 cash purchase price, plus 7% simple interest. Finally, the court held that attorney fees were not warranted under the American Rule because defendants’ conduct, while “less than ideal,” did not fall within the limited fraudulent-or-unlawful-conduct exception. Affirmed.

No-fault insurance; PIP benefits; Fraud evidence; Credibility; Jury instructions; Verdict form; Attorney misconduct; Fair trial; Juror dismissal; Outside influence; Mitigation of damages; Mootness; Cumulative error

The court held that plaintiff was not entitled to a new trial after the jury found no cause of action on her no-fault PIP claim. Plaintiff sought PIP benefits after a rear-end accident, but defendant-insurer denied the claim after investigating and alleging fraud related to replacement services. On appeal, the court first held that the trial court did not abuse its discretion by admitting evidence of plaintiff’s alleged fraud because “witness credibility is always relevant,” and the evidence bore directly on her credibility about “the benefits she sought and whether she sustained her injuries because of the accident.” The court also held that the fraud instruction and verdict-form question were proper because defendant maintained that plaintiff’s claims were fraudulent, presented evidence on that theory, and the verdict-form question was limited to household-replacement services at plaintiff’s request. The court further noted that any error would not warrant relief because the jury answered “NO” on the fraud question. The court next held that defense counsel’s trial conduct did not deny plaintiff a fair trial because counsel’s arguments about “track-one” and “track-two” doctors and alleged fraud were “consistent with the evidence presented” and were not merely designed to inflame the jury. The court also held that the trial court did not clearly abuse its discretion by dismissing Juror 4 because the juror disclosed prior treatment at a medical clinic connected to a witness, which was an “outside influence” that could have impeded her ability to serve. Finally, the court held that plaintiff’s mitigation-instruction argument was moot because the jury found she did not suffer an injury arising out of the accident and never reached damages, and that no cumulative-error relief was available because “there can be no cumulative effect where there are no errors.” Affirmed.

Conversion or embezzlement claims; Failure to brief an issue on appeal; Failure to dispute the actual basis of the trial court’s ruling; Summary disposition without a damages award

The court concluded that defendant failed to show she was entitled to appellate relief where she failed to challenge the basis of the trial court’s ruling and adequately brief the issues. “Defendant previously represented plaintiff’s former trustee.” After hearings in a probate case, “the probate court held defendant in contempt” and plaintiff filed this action asserting claims for conversion or embezzlement. In successfully moving for summary disposition, plaintiff relied “on defendant’s answers to the complaint, defendant’s statements made at the probate court contempt hearing, and checks reflecting the distribution to defendant’s corporate entity and plaintiff’s estate.” Defendant argued on appeal that “substantively admissible evidence was not presented in the contempt hearing and the trial court did not enter a judgment amount.” The court found it did not have to decide “whether the trial court erred in relying on the” contempt hearing transcript given that defendant failed to brief the issue. And it noted plaintiff “also claimed that defendant’s answers to the complaint provided a factual basis for” summary disposition. The trial court indicated it granted plaintiff’s motion “for the reasons set forth in plaintiff’s brief. Because defendant” failed to brief or address whether the answers properly served as a basis for granting the motion, and the trial court’s reliance on this aspect of the motion, she did not show she was entitled to relief. As to the lack of a damages award, “summary disposition is appropriate under MCR 2.116(C)(10) when, except as to ‘the amount of damages,’ there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law.” The trial court did not receive any proofs on “the damage award or enter a judgment amount. Thus, defendant may still contest this issue in the trial court.” Affirmed.

Conversion or embezzlement claims; Failure to brief an issue on appeal; Failure to dispute the actual basis of the trial court’s ruling; Summary disposition without a damages award

The court concluded that defendant failed to show she was entitled to appellate relief where she failed to challenge the basis of the trial court’s ruling and adequately brief the issues. “Defendant previously represented plaintiff’s former trustee.” After hearings in a probate case, “the probate court held defendant in contempt” and plaintiff filed this action asserting claims for conversion or embezzlement. In successfully moving for summary disposition, plaintiff relied “on defendant’s answers to the complaint, defendant’s statements made at the probate court contempt hearing, and checks reflecting the distribution to defendant’s corporate entity and plaintiff’s estate.” Defendant argued on appeal that “substantively admissible evidence was not presented in the contempt hearing and the trial court did not enter a judgment amount.” The court found it did not have to decide “whether the trial court erred in relying on the” contempt hearing transcript given that defendant failed to brief the issue. And it noted plaintiff “also claimed that defendant’s answers to the complaint provided a factual basis for” summary disposition. The trial court indicated it granted plaintiff’s motion “for the reasons set forth in plaintiff’s brief. Because defendant” failed to brief or address whether the answers properly served as a basis for granting the motion, and the trial court’s reliance on this aspect of the motion, she did not show she was entitled to relief. As to the lack of a damages award, “summary disposition is appropriate under MCR 2.116(C)(10) when, except as to ‘the amount of damages,’ there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law.” The trial court did not receive any proofs on “the damage award or enter a judgment amount. Thus, defendant may still contest this issue in the trial court.” Affirmed.