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Fayetteville Business & Commercial Law Blog

Farmer sues Monsanto for genetically modified crops

North Carolina farmers may be aware of a new lawsuit in which Monsanto is being sued by a Kansas farmer. The Kansas farmer has reportedly found Monsanto's genetically engineered wheat on their farm. The farmer is claiming gross negligence against the corporation. The modified wheat located on the Kansas farmer's plot of land is designed to be resistant to herbicide. The wheat is considered safe to eat by the USDA, but the USDA does not believe that the wheat was actually sold.

Genetically engineered wheat hasn't been approved in the United States for sale, which means that contamination in the Kansas farmer's field may affect his ability to sell his crops. This is because much of the wheat grown in the United States is actually exported to other parts of the world, and much of the world still does not approve of genetically engineered wheat products. Some imports have been suspended since the announcement that crops may have been contaminated with genetically engineered wheat.

NC town and wildlife sanctuary embroiled in civil suit

This story begins in 1999 when the Beech Mountain Town Council entered into a 30-year lease with Genesis Wildlife Sanctuary for the amount of $1. In March 2012, the town's attorney, Four Eggers, sent notice to the sanctuary that it had violated the lease. Two months after that, the town filed a complaint in the Watuga County Small Claims Court calling for an immediate eviction of Genesis from the property.

Genesis made a quick appeal, countering with its own claim that alleged unfair and deceptive trade practice, violation of civil and constitutional rights, breach of lease and inverse condemnation. The town responded in October 2012 with a counterclaim that denied the sanctuary's allegations. The business dispute had been going on for over a year before it reached the North Carolina Superior Court.

Government awards small-business contracts to large companies

Small businesses in North Carolina and throughout the country create most of the net new jobs in America. The expenses incurred by these job-creating small businesses, including business litigation, are significant. Despite the fact that small businesses help drive the American economy, studies have shown that the federal government is giving small-business contracts to huge corporations.

Data from the U.S. Census Bureau shows that small businesses created more than 90 percent of the net new employment positions in the United States. A study by the Kaufmann Foundation found that small businesses generated 100 percent of net new jobs in America since 1980.

Racing out of North Carolina

Accused of breach of contract to the tune of $60 million, Cabarrus County will likely soon lose one of its iconic NASCAR races, the Bank of America 500. The BoA 500 has previously been held at the Charlotte Motor Speedway in Cabarrus County and helps to contribute to the employment of over 3,000 people in the county who rely on tourism. Losing the race would mean a great loss to the local economy; and local politicians are scrambling to salvage the relationship between the race and the county.

Bruton Smith, the NASCAR mogul who is spearheading the charge to move the BoA 500 to Las Vegas, accused Cabarrus County of a material breach of contract in promising $60 million for improvements to the area immediately surrounding the Charlotte Motor Speedway. Smith owns the Charlotte Motor Speedway as well as the Las Vegas Motor Speedway, so he definitely has the ability to make the move if he so chooses. Although Smith himself denies that the decision has been made final, one source says that it is a done deal.

NC bill would ban Tesla

A new bill under consideration in the North Carolina legislature would make it illegal for Tesla, a manufacturer of electric cars, to use a direct-sales method to sell vehicles in the state. The bill would disallow Tesla's usual practice of establishing a business in the state without using a licensed dealer. The proposed law would include online sales, the primary marketing method Tesla uses to sell its vehicles. The bill has passed the Senate and will be heard in the House.

The Palo Alto, California, company created the first all-electric sports car and has now produced the first premium electric sedan. The Model S has earned near-perfect ratings from Consumer Reports. According to the North Carolina Automobile Dealers' Association, the bill conforms to current law that has prohibited the direct sales of automobiles in the state since the 1970s. The bill would simply update the definition of a dealer to include online sales models.

Fayetteville developer wins right to convert Prince Charles

The United States Bankruptcy Court gave permission for a Fayetteville developer to begin conversion of the historic Prince Charles building downtown into condominiums and "micro" offices. The developer will be required to complete a feasibility study that will explain his plans to renovate the dilapidated landmark into 450-square-foot offices and small condominium spaces that will sell for under $100,000. The plans have been delayed by business disputes between the building's current New York owner, who is in bankruptcy, and the city, which has a lien on the property.

The developer plans to turn the building into a showplace with a bar and restaurant, health club and business center as well as a ballroom on the eighth floor. He estimates the project will cost $6 million. The investor was reluctant to put in the money without having the bankruptcy court's approval of the Chapter 11 reorganization plan so that he could get clear title from the owner.

Google announces plan to invest $600 million in North Carolina

On April 19, Google announced that the company has plans to spend $600 million to expand its data center in Lenoir. The plan to establish a business expansion will double the amount of money that Google has invested in North Carolina.

Google has also announced that it plans to participate in a new, voluntary energy program that allows customers to choose to purchase renewable energy. Duke Energy is developing the program for large customers and intends to make a regulatory filing with the N.C. Utilities Commission within the next 90 days before proceeding with the program. Customers are not required to participate in the energy renewal program, and there will be no impact on customers that choose not to participate. Representatives from Google and Duke Energy attended the announcement, along with the governor and members of the legislature.

Duke Energy loses rate increase bid of 2012

Major North Carolina energy supplier Duke Energy has lost a bid to increase their rates to support a 10.5 percent return on equity. The company was originally challenged by the North Carolina attorney general after it instituted a 7.2 percent rate hike in 2012, and the business dispute arose when the attorney general disputed the rate increase. He contends that a commission did not find any evidence to support this high rate of return.

The 10.5 percent figure was actually a compromise reached by the N.C. Utilities Commission's public staff and Duke Energy. This amount reduced the original rate increase of 15 percent down to the 7.5 percent adjusted rate. While Duke believed its rate of return should be 11.25 percent, the public staff believed that it should only be 9.25 percent. However, the court stated that the 10.5 percent compromise simply fell between the two declared levels. It did not actually provide evidence to support the ROE determination, so the court reversed the Commission's order, and it asking the Commission to review it and submit an amount that has sufficient findings to support it. The decision was unanimous. 

SEC adopts updated regulations for social media use

The Securities and Exchange Commission informed companies of some new rules related to social media practices. Business owners can release information with status updates, posts, tweets and blogs as long as they let investors know what they are doing. One case in question involved a status update that a chief executive posted on his personal account as he offered congratulations for a record-high volume of business.

The case carries implications for establishing a business in North Carolina and in the rest of the U.S. as companies must comply with requirements that all investors have full information related to financial aspects of the business at the same time. In the case in question, investors who did not follow him on social media did not have access to the same information in a timely fashion.

Consulting firm assesses viability of hospital split

The administrators of a North Carolina hospital group are discussing possible plans to dissolve their business union. As they negotiate several options, they are also considering who will manage the company. Two counties decided they no longer want to be connected with the partnership, in part due to overall dissatisfaction in the medical community.

Specific reasons include cultural differences, a status that is viewed as lower than others, concerns about local health care services and a reduced overall profit margin. However, after the hard work of establishing a business, it might not be as easy to dissolve. A minimum of 75 percent of the hospital board needs to agree to dissolve the business. The business alliance did not technically qualify as a merger since the involved parties both retained financial control of their own facilities. However, the purpose of the group was to work together as a team.

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