Source: http://openjurist.org/656/f2d/103
Timestamp: 2013-12-11 15:44:38
Document Index: 327151641

Matched Legal Cases: ['§ 10', '§ 78', '§ 12', '§ 77', '§ 3', '§ 97', '§ 105', '§ 105']

656 F2d 103 Jones v. J Miles D W H | OpenJurist
656 F. 2d 103 - Jones v. J Miles D W H	Home656 f2d 103 jones v. j miles d w h
656 F2d 103 Jones v. J Miles D W H 656 F.2d 103
Blue Sky L. Rep. P 71,655, Fed. Sec. L. Rep. P 98,276Robert P. JONES, Plaintiff-Appellee,v.J. Merrell MILES, D. Herschell Miles, Jewel Miles, FranklinEarl Miles, Larry W. Miles and H. Frank Tanner,Defendants-Appellants.
No. 80-7544.
Before KRAVITCH and HENDERSON, Circuit Judges, and DANIEL H. THOMAS*, District Judge.
The plaintiff-appellee, Robert P. Jones, filed this action in the district court charging the defendants-appellants, J. Merrell Miles, Franklin Earl Miles and H. Frank Tanner, and others, with state and federal securities violations and common law fraud. He essentially complains that the appellants knowingly made false representations and omissions to him concerning the financial condition of a company owned and controlled by the Miles in order to induce him to enter into a merger with his business. The five-count petition is premised on § 10(b) of the Securities Exchange Act of 1934 (15 U.S.C.A. § 78j (1971)), §§ 12(2) and 17(a) of the Securities Act of 1933 (15 U.S.C.A. §§ 77l, 77q (1971)), §§ 3, 5, and 12 of the Georgia Securities Act of 1973 (Ga.Code Ann. §§ 97-103, 105, 112 and 114 (1973)), fraud under Ga.Code Ann. § 105-301 (1968), and exemplary damages pursuant to Ga.Code Ann. § 105-2002 (1968).
Negotiations to combine the two companies began in the summer of 1976, when Jones, doing business as American Machine Products Company, Inc. (American), was engaged in machine work for the appellant J. Merrell Miles. Eventually, a decision was reached to merge American with Burke County Industrial (Burke), the firm owned by the Miles. Prior to the actual merger of the companies on or about October 16, 1976, each party was permitted to examine the financial records and facilities of the other's business. Jones also consulted the appellant H. Frank Tanner, a certified public accountant to whom Jones was introduced by the Miles, for financial information comparing the value, assets and liabilities of the two firms.
During the trial, Jones identified three specific misrepresentations purportedly made to induce him to enter into the agreement. He claimed that 1) the value of the assets in the appellants' company was not equal to or more than the value of the assets of his own enterprise as had been represented to him; 2) the appellants did not provide sufficient capital to operate the new business as originally promised; and 3) the appellants misrepresented to him that they had or could obtain the business of the Georgia Power Company. The evidence indicates that Jones became aware of the supposed inaccuracies of these statements as early as January, 1977. In defense, the Miles maintain that the misrepresentations, if any, were not actionable, because no specific promises or claims were made.
Before these alleged falsities came to light, though, Jones' company purchased the assets and liabilities of Burke. Jones retained 42% of the stock in the merged corporation and the Miles received the remaining 58% of the equity interest. Later, when the operational difficulties and the economic inequalities of the original agreement became manifest, the parties reached a new understanding. On February 27, 1977, they agreed to cancel all stock previously issued and to reissue the shares, 50% to Jones and 50% to the Miles. When the business continued to fail, the parties reached a third agreement on June 20, 1977, to sell the assets of the corporation and apply the proceeds to its business debts.
At the conclusion of the trial, the jury returned a general verdict of $60,000.00 actual damages and $65,000.00 punitive damages in favor of Jones and against the appellants. The appellants made no motion for directed verdict or for judgment notwithstanding the verdict. The three appellants did file a motion for a new trial, which was denied by the district court. They appeal from the judgment entered by the district court as well as the denial of the motion for new trial, and ask that all or part of the verdict be set aside and that a new trial be granted on grounds of insufficient evidence of actionable misrepresentation,1 waiver of punitive damages under the common law count because of the conduct of the appellee, and failure of the trial court to instruct the jury on waiver.
Because only a general verdict was returned, our review of the judgment and the denial of a new trial is hampered.2 In this posture, it is impossible to tell which theory of liability was adopted by the jury and the sufficiency of the evidence in support thereof.3 A nonspecific, general verdict is acceptable, even in a case alleging multiple theories of liability, if each of the several theories is sustained by the evidence and legally sound.4 Such a determination cannot be made here, though, because an error objected to by the appellants at the trial and asserted in their motion for new trial compels a remand of the entire case to the