[Download] "Fore Way Express v. Gordon Bast" by Court of Appeals of Wisconsin # eBook PDF Kindle ePub Free
eBook details
- Title: Fore Way Express v. Gordon Bast
- Author : Court of Appeals of Wisconsin
- Release Date : January 03, 1993
- Genre: Law,Books,Professional & Technical,
- Pages : * pages
- Size : 68 KB
Description
Fore Way Express, Inc., and several of its officers (collectively, Fore Way) appeal a summary judgment declaring that the
Fore Way Express Profit Sharing Plan (the Plan) is a security required to be registered under sec. 551.21, Stats., and awarding
the respondents $138,873.46 in damages and prejudgment interest and $180,553.82 in costs and attorney fees. Fore Way contends
that the trial court erred by refusing to grant summary judgment in its favor because the undisputed facts demonstrate that
the Plan is neither a profit sharing agreement nor an investment contract within the meaning of sec. 551.02(13)(a). Fore Way
argues that the trial court misapplied the "economic realities" test to determine whether the substance of an instrument constitutes
a profit sharing agreement or an investment contract. In the alternative, Fore Way argues that disputed issues of material
fact precluded summary judgment. Fore Way also contends that the Labor-Management Relations Act (LMRA), 29 U.S.C. §
185 (1978), preempts the respondents' state law claims and LMRA, 29 U.S.C. § 173 (1978), requires the respondents
to submit their claims to arbitration before seeking judicial relief. Fore Way argues that the Plan was a valid amendment
to its Collective Bargaining Agreement (CBA) with the Teamsters Union and therefore was subject to CBA's arbitration provisions
and the LMRA. We conclude that there are no disputed facts precluding summary judgment. We further conclude that the proper test for determining
whether the Plan is either a certificate of participation in a profit sharing agreement or an investment contract is to examine
the facts underlying the Plan to determine if it is consistent with the economic realities commonly underlying those two types
of security. Because the Plan involves no underlying securities, no pooling of assets and does not constitute a certificate
of participation in a profit sharing agreement independent of the employment relationship, we conclude that the facts are
inconsistent with the economic reality underlying a certificate of participation in a profit sharing agreement. Because the
respondents' interest in the Plan is not an independent financial interest that has the substantial characteristics of a
security and because the respondents failed to demonstrate a reasonable expectation of a benefit over and above the value
of their conceded wages, we conclude that the facts are inconsistent with the economic reality underlying an investment contract.
Because Fore Way has prevailed on this basis, we need not address Fore Way's preemption and necessity of arbitration claims.
The judgment is reversed.