Holmes v. Lerner
California Court of Appeals
88 Cal. Rptr. 2d 130 (1999)
Patricia Holmes (plaintiff) and Sandra Kruger Lerner (defendant) orally agreed to start a cosmetics business called Urban Decay. David Soward (defendant) was the general partner of “& Capital,” a venture capital partnership comprised of Soward, Lerner, and Lerner’s husband. Soward agreed that & Capital would provide $500,000. Lerner and Holmes did not contribute. Holmes regularly attended informal board meetings, participated in the creation of products, and worked in the warehouse. In interviews and press releases, Lerner said the business was Holmes’ idea. Holmes asked for “something in writing,” but no allocation of share had been agreed upon. When Holmes requested a copy of the articles of incorporation, she received only the first two pages. Holmes was left off an organizational chart but told she was a “director.” Soward offered Holmes a one percent share of the limited liability company that had been formed. The situation worsened until Holmes was barred from Urban Decay. Holmes sued Lerner for breach of the oral partnership agreement and Soward for interference with the contract. At trial, experts valued the company between $2 million and more than $6 million, and one expert projected sales of $52 million by 2003. Lerner then denied that Holmes created or had any official role with the company. The jury awarded Holmes compensatory and punitive damages above $1 million. After a motion for judgment notwithstanding the verdict was denied, Lerner and Soward appealed to the California Court of Appeals.
Rule of Law
Holding and Reasoning (Marchiano, J.)
What to do next…
Unlock this case brief with a free (no-commitment) trial membership of Quimbee.
You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 97,000 law students since 2011. Some law schools—such as Yale, Vanderbilt, Berkeley, and the University of Illinois—even subscribe directly to Quimbee for all their law students. Read our student testimonials.
Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.
Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students. Read more about Quimbee.
Here's why 153,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 13,500 briefs, keyed to 184 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.