Nolte v. Pearson
| Decision Date | 19 July 1993 |
| Docket Number | No. 92-2913,92-2913 |
| Citation | 994 F.2d 1311 |
| Parties | RICO Bus.Disp.Guide 8308 Harlan NOLTE; Sharon Nolte; Ramon Nolte; Dorothy Nolte; Michael Dolphens; Dorothy Dolphens; Orville Stocker; Norma Jean Stocker, Plaintiffs, Richard L. Spencer, Plaintiff-Appellant, Ed Klanecky, Personal Representative; Plaintiff, v. Stanley PEARSON; Jerry Denby; Christopher Kulawik; Barbara E. Productions; Barbara Gelasno, formerly known as Barbara Goldman; Tim Lane; Eugene Weiss; Joseph Keaney; Polo Communications, Ltd., Defendants. Dennis L. MOEN; Patricia A. Moen, Plaintiffs-Appellants, v. Stanley PEARSON; Jerry Denby; Christopher Kulawik; Barbara E. Productions, Inc.; Barbara Gelasno, formerly known as Barbara E. Goldman, Defendants, Rosenbaum, Wise, Lerman, Katz & Weiss, a Partnership; Arthur R. Rosenbaum; Defendants-Appellees. Aaron N. Wise, Defendant, Marvin S. Lerman; Elliott L. Katz; Stephen A. Weiss, Defendants-Appellees, Tim Lane; Eugene Weiss; Joseph Keaney, Defendants. Carl M. ROSENBAUGH; A. Dean Wallant, Plaintiffs-Appellants, v. Stanley PEARSON; Jerry Denby; Christopher Kulawik; Barbara E. Productions, Inc.; Barbara Gelasno, formerly known as Barbara E. Goldman; Tim Lane, Defendants, Rosenbaum, Wise, Lerman, Katz & Weiss, a Partnership; Arthur R. Rosenbaum, Defendants-Appellees, Aaron N. Wise; Defendant, Marvin S. Lerman; Elliot L. Katz; Stephen A. Weiss; Defendants-Appellees, Eugene Weiss; Joseph Keaney; Polo Communications, Ltd., Defendants. Ted TROMLER; Laressa Tromler; Leslie Vaughn; Donna Vaughn; Robert Zabawa; Therese Zabawa, Plaintiffs-Appellants, v. Stanley PEARSON; Jerry Denby; Christopher Kulawik; Barbara E. Productions, Inc.; Barbara Gelasno, formerly known as Barbara E. Goldman; Tim Lane, Defendants, Rosenbaum, Wise, Lerman, Katz & Weiss; Arthur R. Rosenbaum, Defendants-Appellees, Aaron N. Wise, Defendant, Marvin S. Lerman; Elliott L. Katz; Stephen A. Weiss, Defendants-Appellees, Eugene Weiss; Joseph Keaney; Polo Communications, Inc., Defendants. William F. DUCHESNE; Karoline G. Duchesne, Plaintiffs-Appellants, v. |
| Court | U.S. Court of Appeals — Eighth Circuit |
George T. Qualley, Omaha, NE, argued for appellants.
Patrick Shawn McCann, Omaha, NE, argued (Craig W. Feil, on the brief), for appellees.
Before FAGG, and MAGILL, Circuit Judges, and STUART, * Senior District Judge.
This is an appeal from an order of the district court 1 granting a directed verdict against the plaintiffs on their claims for fraud, negligent misrepresentation, and RICO violations. For the reasons discussed below, we affirm.
The plaintiffs, investors in a master music recording leasing program, brought this action against the Rosenbaum law firm and its members (the law firm) who represented Music Leasing Company. Music Leasing Company is a corporation engaged in the business of acquiring and leasing master music recordings. Jerry Denby, the executive vice president of Music Leasing Company contacted Stephen Weiss, an attorney with the defendant law firm. Denby provided Weiss documents pertaining to the leasing program and explained the program's structure and operation. The law firm prepared various documents for Music Leasing Company so the company could provide prospective investors information about the leasing program. Four documents prepared by the law firm are relevant in this appeal: an attorney opinion letter and accompanying information memorandum dated August 31, 1980 advising investors of federal income tax consequences; a defense letter agreeing to render legal assistance to investors; and two documents explaining whether changes in federal tax laws would have a material effect on an investor's income tax consequences.
The investors formed general partnerships that separately leased master music recording rights from Music Leasing Company. In return for their investments, they were to receive investment tax credits. The investors became dissatisfied when they learned the Internal Revenue Service was disallowing the tax credits. This suit followed.
At the close of plaintiffs' evidence the district court granted a directed verdict in favor of the law firm on each of plaintiffs' theories of recovery. The investors appeal arguing there was sufficient evidence to create a jury question on each claim.
In reviewing the propriety of granting a motion for a directed verdict, we use the same standard as the district court. Hauser v. Equifax, Inc., 602 F.2d 811, 814 (8th Cir.1979).
The motion is to be granted only when the nonmoving party has presented insufficient evidence to support a jury verdict in his favor. In deciding this question, the evidence must be viewed in the light most favorable to the nonmoving party, without assessing credibility. In addition, the nonmoving party is entitled to the benefit of all reasonable inferences, that is, inferences which may be drawn from the evidence without resort to speculation.
With these principles in mind, we proceed to examine the theories of recovery and evidence advanced by the plaintiffs to determine if the district court properly granted the defendants' motion for directed verdict.
The trial court found that the plaintiffs had been victims of a massive fraud which seriously damaged them. The question here is whether the Rosenbaum law firm or some of its members were involved in the fraud.
To sustain a cause of action for fraudulent misrepresentation, a plaintiff must prove:
that a representation was made; that the representation was false; that the representation was known to be false when...
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... ... lawyers provided legal advice and services, even where the intentionally assisted a fraudulent scheme by the clients to defraud); see also Nolte v. Pearson, 994 F.2d 1311 (8th Cir.1993) (affirming district court's directed verdict for defendant lawyers because no evidence suggested that the ... ...
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... ... See also Nolte v. Pearson, 994 F.2d 1311, 1317 (8th Cir.1993) (attorneys who prepared allegedly false opinion letters and informational memoranda regarding a music ... ...
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... ... Nabors, 45 F.3d 238, 239 (8th Cir. 1995) (quoting Sedima for the elements of the violation in a criminal RICO prosecution); Nolte v. Pearson, 994 F.2d 1311, 1316-17 (8th Cir. 1993); Bowman, 985 F.2d at 385 (quoting Sedima); Terry A. Lambert Plumbing, Inc. v. Western Sec. Bank, ... ...
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... ... because one provides goods or services that ultimately benefit the enterprise does not mean that one becomes liable under RICO as a result"); Nolte v. Pearson, 994 F.2d 1311, 1317 (8th Cir.1993) (preparer of opinion letters and informational memoranda for RICO enterprise did not participate in ... ...