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STATE OF MICHIGAN COURT OF APPEALS

DOUGLAS DAWSON, Plaintiff-Appellee, v LEROY DELISLE, RON ALLMAN, PTI PAINT SATELLITE, L.L.C., PTI MANAGEMENT GROUP, INC., PTI QUALITY CONTAINMENT SOLUTIONS, INC., PTI MANAGEMENT STAFFING, INC., and PTI LOGISTICS NA, L.L.C., Defendants-Appellants, and FRANCIS LEO and WOCO U.S.A., INC., Defendants.

UNPUBLISHED July 21, 2009

No. 283195 Wayne Circuit Court LC No. 07-731127-CK

Before: Davis, P.J., and Murphy and Fort Hood, JJ. PER CURIAM. Defendant-appellants appeal by leave granted from the trial court's order denying their motion for summary disposition. We reverse the trial court's denial of summary disposition as to plaintiff's fraud and breach of fiduciary contract claims, but we decline to consider the remaining claims alleged in plaintiff's original complaint because plaintiff's amended complaint omits those claims, thereby abandoning them and rendering our consideration of them moot. Plaintiff alleges that he has been a member of IIG-DSS Technologies, LLC ("IIG-DSS") since its formation in 2004, and that he was the vice president of sales and finance for IIG-DSS. Defendant Leroy DeLisle was named in the complaint as the chief executive officer of IIG-DSS and, commencing in 2006, a shareholder of the company. Defendant Ron Allman was the alleged vice president of all operations for IIG-DSS. Defendant Francis Leo was IIG-DSS's president. He also allegedly served as president of an entity, International Industrial Group, Inc. (IIG Inc.), which was a member of IIG-DSS. This action arises out of plaintiff's claim that the various defendants breached fiduciary duties and otherwise caused financial harm to IIG-DSS by failing to seek out new business or new investors and by actively attempting to usurp IIG-DSS's -1-

contracts with defendant Woco U.S.A., Inc., and another company, Hi-Lex. complaint sought recovery under various tort theories and for breach of contract.

Plaintiff's

In lieu of an answer, defendants-appellants moved for summary disposition pursuant to a number of court rules. They argued that, pursuant to MCR 2.116(C)(4), the trial court lacked subject-matter jurisdiction because of IIG-DSS's pending bankruptcy proceeding; that pursuant to MCR 2.116(C)(7), plaintiff's claims were barred because plaintiff failed to comply with federal bankruptcy rules; and that pursuant to MCR 2.116(C)(5) and (8) plaintiff lacked standing to assert the claims in his individual capacity and failed to satisfy the criteria for filing suit on behalf of IIG-DSS. The trial court determined that plaintiff should have an opportunity to factually develop his claims to show that he was asserting individual rather than derivative claims and, therefore, denied defendants-appellants' motion. This Court's grant of leave to appeal was limited to the issues raised in the application; however, we have the authority in extraordinary circumstances to consider issues not raised in the application and supporting brief. See MCR 7.216(A); United Parcel Service, Inc v Bureau of Safety & Regulation, 277 Mich App 192, 204; 745 NW2d 125 (2007). Because mootness presents a jurisdictional question that may be raised at any time, we initially consider plaintiff's claim that defendants-appellants' arguments concerning the breach of contract, tortious interference, and conspiracy claims that were alleged in the original complaint are now moot. Michigan Chiropractic Council v Ins Comm'r of the Office of Financial & Ins Services, 475 Mich 363, 370-374; 716 NW2d 561 (2006) (opinion by Young, J.). "Mootness precludes the adjudication of a claim where there is no longer an actual controversy." Id. at 371 n 15. Mootness will also be found where "an event occurs that renders it impossible for the reviewing court to fashion a remedy to the controversy." People v Cathey, 261 Mich App 506, 510; 681 NW2d 661 (2004); but see Mead v Batchlor, 435 Mich 480, 486; 460 NW2d 493 (1990) (an issue will not be deemed moot if a trial court's adverse order or judgment may have collateral legal consequences for a defendant). A court does not reach moot issues or declare principles of law that have no practical effect in a case, unless the issue involves a matter of public significance that is likely to recur and evade judicial review. Federated Publications, Inc v City of Lansing, 467 Mich 98, 112; 649 NW2d 383 (2002), clarified in part in Herald Co, Inc v Eastern Michigan Univ Bd of Regents, 475 Mich 463, 470-472; 719 NW2d 19 (2006). The record shows that after the trial court denied defendants-appellants' summary disposition motion, plaintiff filed an amended complaint that omitted the previously alleged breach of contract, tortious interference, and conspiracy claims. We agree with plaintiff that these claims are now moot. Plaintiff has abandoned the claims by filing an amended complaint that excludes the claims. Cf. People v Riley, 88 Mich App 727, 731; 279 NW2d 303 (1979). Therefore, we limit our review to the breach of fiduciary duty and fraud claims upon which plaintiff seeks an award of monetary damages from defendants DeLisle and Allman. We review a trial court's summary disposition decision de novo to determine if the moving party was entitled to judgment as a matter of law. Maiden v Rozwood, 461 Mich 109, 118; 597 NW2d 817 (1999). Our review is limited to the record before the trial court at the time of its decision. Spiek v Dep't of Transportation, 456 Mich 331, 338; 572 NW2d 201 (1998); Amorello v Monsanto Corp, 186 Mich App 324, 330; 463 NW2d 487 (1990). The trial court did -2-

not specify which subrule it relied on in denying the motion for summary disposition, but it appears that the trial court relied solely on the pleadings; we therefore review its decision under MCR 2.116(C)(8). Spiek, supra at 338; Michigan Chiropractic Council, supra at 374 n 25; Leite v Dow Chem Co, 439 Mich 920; 478 NW2d 892 (1992) (issue of standing is properly considered under MCR 2.116(C)(8) or MCR 2.116(C)(10), depending on the pleadings and the circumstances of the case). Under MCR 2.116(C)(8), the pleadings alone are considered and viewed in the light most favorable to the non-moving party; summary disposition is appropriate where a claim is so clearly unenforceable as a matter of law that no factual development could possibly justify the plaintiff's recovery. Maiden, supra at 119-120. The pleaded allegations must be sufficient to reasonably inform an adverse party of the nature of the claims the adverse party is called on to defend. MCR 2.111(B)(1); Kloian v Schwartz, 272 Mich App 232, 240; 725 NW2d 671 (2006); see also MCR 2.112(B) (circumstances constituting fraud must be stated with particularity). "A mere statement of a pleader's conclusions, unsupported by allegations of fact, will not suffice to state a cause of action." Kloian, supra at 241, quoting Lawsuit Financial, LLC v Curry, 261 Mich App 579, 592; 683 NW2d 233 (2004). The doctrine of standing generally requires that the party's interest in the outcome of the litigation ensure sincere and vigorous advocacy. Michigan Chiropractic Council, supra at 371 n 13. A plaintiff must prove (1) a concrete injury in fact, (2) a causal connection between the injury and conduct complained of that it fairly traceable to the defendant's action, and (3) that the injury will likely be redressed by a favorable decision. Id. at 371 n 13. Under MCR 2.201(B), subject to certain provisions, an action must be prosecuted in the name of the real party in interest. Leite, supra at 920. "A real party in interest is one who is vested with the right of action on a given claim, although the beneficial interest may be in another." Blue Cross & Blue Shield of Michigan v Eaton Rapids Community Hosp, 221 Mich App 301, 311; 561 NW2d 488 (1997). In cases involving corporations, the "[t]he doctrine of standing provides that a suit to enforce corporate rights or to redress or prevent injury to a corporation, whether arising from contract or tort, ordinarily must be brought in the name of the corporation, and not that of a stockholder, officer, or employee." Belle Isle Grill Corp v Detroit, 256 Mich App 463, 474; 666 NW2d 271 (2003). An exception exists if the shareholder, officer, or employee is owed a duty independent of the corporation. Id.; Michigan Nat'l Bank v Mudgett, 178 Mich App 677, 679; 444 NW2d 534 (1989). Another exception applicable to shareholders allows for an individual lawsuit if the injury sustained is separate and distinct from other stockholders generally. Christner v Anderson, Nietzke & Co, PC, 433 Mich 1, 9; 444 NW2d 779 (1989). Although the instant case involves a limited liability company instead of a corporation, we shall consider corporate principles by analogy, to the extent that the situation supports them. Cf. Energy Investors Fund, LP v Metric Constructors, Inc, 351 NC 331; 525 SE2d 441 (2000). A limited liability company is a form of "hybrid business entity that offers all of its members limited liability as if they were shareholders of a corporation but treats the entity and its

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members as a partnership for tax purposes." Am Jur 2d, Limited Liability Companies,

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