Klinicki v. Lundgren

F. R. Klinicki (plaintiff) and Kim Lundgren (defendant) were pilots and coworkers stationed in West Germany. After both men were furloughed, Klinicki discussed the possibility of starting an air-transportation business in Berlin with Lundgren. Lundgren expressed interest, and in April 1997 the men formed Berlinair, Inc., a closely held Oregon corporation. Klinicki owned 33 percent of Berlinair’s stock. At the time of formation, Klinicki and Lundgren contemplated pursuing a contract with Berliner Flug Ring (BFR), a prominent association of Berlin travel agents that frequently hired pilots to fly German tourists around. In November 1997, Klinicki and Lundgren had an initial meeting with BFR. Thereafter, either Lundgren or Lundgren’s subordinates exclusively spoke with BFR’s representatives because Lundgren handled Berlinair’s operations. At first, Lundgren thought a contract was unobtainable because BFR indicated satisfaction with its current carrier. However, in June 1978, Lundgren learned that the contract might be available. Lundgren kept this information to himself, formed a new company of his own, Air Berlin Charter Company (ABC) (defendant), and obtained the BFR contract for ABC. Klinicki, as a minority shareholder in Berlinair, filed a derivative claim against ABC for usurpation of a corporate opportunity, as well as an individual claim against Lundgren for breach of his fiduciary duty to Berlinair. The trial court ruled in Klinicki’s favor. ABC appealed and argued that it did not usurp a corporate opportunity from Berlinair because Berlinair did not have the financial ability to undertake the BFR contract. The appellate court affirmed. ABC appealed.