Alaine Greenberg and William Clayton with Greenberg Traurig (Melanie Bell)
Case: ARGP v. John J. Boyle, Jack Boyle, Auto Relief Group II and Auto Relief Group
Case no: 502010CA005791XXXXMB
Description: Breach of contract
Filing Date: March 3, 2010
Judge: Palm Beach Circuit Judge Donald W. Hafele
Plaintiff attorney: James W. Beasley Jr. and Raymond Kramer III, Beasley Hauser Kramer & Galardi, West Palm Beach
Defense attorney: William R. Clayton and Alaine Greenberg, Greenberg Traurig, Fort Lauderdale
Verdict: For the defense
Details: Plaintiffs Reid Boren and J.P. Kelly, the principals in ARGP LLC created it as a holding company for Auto Relief Group II, a company formed with John Boyle, the son of famed music promoter Jack Boyle. The business concept was to broker loan modifications between lenders and financially distressed vehicle owners for a fee.
The company launched operations in the fall of 2009 and shut down by the summer of 2010.
ARPG sued John Boyle for breach of contract and breach of fiduciary duty. ARPG sued both John and Jack Boyle for conversion of the plaintiff’s interest, civil conspiracy and tortious interference. The plaintiffs sought minimum damages of $4.9 million but claimed losses valued up to $15 million.
Plaintiffs case: Lead attorney James W. Beasley Jr. declined to comment.
The amended complaint said John Boyle asked Reid Boren to manage the Auto Relief Group, which was portrayed as a prosperous company that relied on a cold-call process.
The two agreed on the conditions that Boyle would provide financing and the two would form a new company, Auto Relief Group II, as an ARGP subsidiary. Boren would have day-to-day managerial control.
Boren alleged Boyle borrowed from his father but kept the money in Auto Relief Group accounts rather than the new company and used most of the money for personal expenses.
ARPG alleged Boyle obligated the company without consent to repay Jack Boyle at 20 percent annual interest, transferred half of his interest in the company to his father, and Jack Boyle became intimately involved in the business and interfered in operational decisions.
Boren claimed violations of the operating agreement and withdrew as manager less than two months after operations began.
Accountant Richard Rampell of Rampell & Rampell in Palm Beach, who testified as an expert, said the business had a value of $10 million. The $4.9 million award claim was based on ARGP’s minority share.
Defense case: William Clayton said the key defense theory was to attack ARGP’s assertion that the company was worth $10 million to $15 million. Revenue in 2009 was about $450,000, while ARG II had more than $1 million in losses. Revenue in 2010 was $604,000, but expenses, mostly from radio advertising, totaled $1.1 million. Clayton argued ARGP was a failure.
When Boren left, John Boyle recruited Jeffrey Cohen, a successful insurance broker, as chief executive officer. He left after two months
Jack Boyle testified he had no day-to-day involvement in the company. During that period, he spent most of his time in Maine with his cancer-stricken wife, Janet. He said his only interest in the company was a $742,000 startup loan, which wasn’t repaid.
Outcome: Circuit Judge Don Hafele ruled Jack Boyle was not a member of the company under the operating agreement for Auto Relief Group II and gave that instruction to the jury. That eliminated the plaintiff’s claim that Jack Boyle breached a fiduciary duty to the plaintiff.
The jury found no breach of contract, no breach of fiduciary duty, no conversion or civil conspiracy, and no tortious interference.
Quote: “When the jury found John Boyle didn’t breach the contract, automatically the claim against Jack Boyle for tortious interference went away,” Clayton said.