LAWRENCEVILLE, Ga. — A significant legal ruling has emerged from Gwinnett County, where a judge has reversed a $3.8 million verdict originally awarded to Champion Instruments LLC, against co-owner Huiming Song. The initial verdict, which had also included $300,000 in punitive damages, was set aside due to the plaintiff’s failure to demonstrate damages with sufficient certainty.
This legal turnaround occurred after Senior Judge John Doran granted Song’s motion for judgment notwithstanding the verdict. Doran’s 30-page ruling highlighted the lack of evidence presented by Champion Instruments to substantiate their claimed losses, impacting both compensatory and punitive damages.
Huiming Song was originally accused by Champion Instruments, an importer of electronic surveying equipment from China, of breaching his fiduciary duty. It was alleged that Song diverted business from Champion to Shanghai HowayGIS Infotech Co. Ltd., a competitor where he also held an ownership interest.
Song, who jointly owned Champion with majority shareholders Travis Pruitt and Lonnie Sears, had his role at Champion come under scrutiny during the trial. Lawyers representing Champion Instruments contended that Song leveraged his insider access to reroute business, impacting Champion’s bottom line.
Robert J. Kaufman and Kevin T. Kucharz of Chalmers, Adams, Backer & Kaufman represented Song in the defense, challenging the claims. However, despite their efforts, the original jury in the Gwinnett County State Court sided with the plaintiff in March 2023, ordering the multi-million dollar compensation.
Following this verdict, Song also filed a separate suit against Pruitt concerning a breach of contract and requested the dissolution of Champion Instruments. This led to the formation of a special litigation committee by Champion, which further investigated internal financial dealings, particularly around the issues of pricing and discounts managed by Pruitt.
While the intermediate appellate stage upheld Judge Doran’s decision, the legal circles involved remain active. Gary S. Freed of Freed Grant and Thomas T. Tate of Andersen, Tate & Carr were among the legal minds challenging numerous points of the dismissal on Song’s behalf.
Despite Doran’s decision removing the burden of the monetary award from Song, his legal team, led by Freed, viewed the overturning as a substantial victory. Freed emphasized the meticulously reviewed facts which highlighted the speculative nature of the damage claims initially awarded.
On the flip side, counsel for Champion Instruments, including Laurie Webb Daniel and Harold T. Daniel Jr., expressed their disagreement with the ruling’s implications on the damages claim and remained optimistic about a different outcome upon retrial. Asserting confidence in the strength of their case, they anticipate the possibility of a more substantial award in a new jury trial.
This case underscores the complexities of proving damages in business disputes, especially when intertwined with allegations of fiduciary breaches and contractual disagreements. As both sides prepare for the next phases of legal battles, the business community watches closely, recognizing the potential implications of this case on partnership and shareholder agreements.