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Home My WebLink About97-05946 ."j ,I " ~ ." ~ c ~ " ~ .:I . f ~ .t ~ =- ~ H " d ,I ~ ~ ..... J ." lL iI :-- . .~ ~ " ~ ... \q ~ ~ . ~ ~ I ) . ;1 . ........... sv.... .. woo-- ATTORNCY. AT L.AW HA,"'I..U"CI. p.HHaVLVAHIA ... 0. ~ ...0 . . . ), (. . . , " . . ~ . '. \ -~. \ , I \ ~- ..-:,~~ --:::::---~ "'. '. .." . J v, : Court of Common Pleas : Cumberland County, Pennsylvania : Civil Action -Law Randal L. Fishel Plaintiff Midstate Communications Corporation Defendant : No, 97-5946 Brief In Support of Plaintiffs Motion for Preemptory Judgment I. PROCEDURAL HISTORY Plaintiff is a shareholder in Defendant Midstate Communications Corporation ('Midstate"), Answer at 113, On October 27, 1997, Piaintiff fiied a Complaint in Mandamus seeking access to Midstate's corporate records, Aiso, on that date, Plaintiff filed a separate action against Midstate and Midstate's Chief Executive Officer, Michael Schatz alkJa Michael Brandon ('Schatz") which alleged breach of contract, promissory estoppel, ....\ unjust enrichment, and violation of Pennsylvania's Wage Payment and Collection Law, 43 P,S, 9260,1 m~, This case is captioned at Court of Common Pleas, Cumberland County, 97-5947 Civil Term, On or about, March 5, 199B, Midstate and Schatz filed an answer and counter-sued Piaintiff for over $2 million dollars worth of damages, alleging, among other things, breach of fiduciary duty, conversion, and breach of contract, Plaintiff fiied on March 1B, 199B a Motion for Preemptory Judgment seeking to require Midstate to provide Plaintiff access to Midstate's books and records, Defendant filed a reply on or about April 8, 1998, Contemporaneously, with its reply and with no explanation. Defendant sent to Plaintiff its corporate bylaws, In its cover letter to counsel, Defendant admitted that additional meeting minutes existed but were 'unaccessible" to its client. This Brief is submitted in support of Plaintiff's Motion for Preemptory Judgment. II, FACTUAL 8ACKGROUND Prior to filing the Compiaint in Mandamus, Plaintiff made numerous requests to inspect the books and records of Midstate. These requests date back to November 1, 1996 when Plaintiff requested in a verified letter to inspect all of Midstate's corporate books and records.' Complaint at 114. In the letter, Plaintiff expressed his purpose for examining the records Preemptory Judgment Motion ('Motion"), Exhibit "A", Plaintiff stated that his purpose in seeking the records was to understand the business operations and financial status of Midstate as well as analyze and understand the nature and extent of his financial interest concerning Midstate. Motion, Exhibit 'A". In fact, Defenaant has not suggested any improper purpose, On Thursday, February 26, 199B, Plaintiff was allowed access to review certain records of Midstate. Motion at 118. Defendant's provision of records on February 26, 1998 was woefully inadequate. Mr tion a1119. Conspicuously absent from the records provided were, among other things, Midstate's bylaws, corporate minutes, any correspondence directed to Midstate or originating from Midstate, Plaintiff's personnel record, any corporate lThe verified leller is included as Exhibit "A" to the Motion for Preemptory Judgment, " - 2 - tax returns, and any documents reflecting the negotiation and sale of the billboard business to Whiteco, Moreover, there were [JQ agreements or contracts included in the disclosed material, On March 6, 199B, Defendant filed its Answer Together with New Matter and Counterclaim, ("Answer") Exhibi~ 'A' to the answer was an alleged indemnification agreement between Midstate shareholders and Pennsyivania ~~ational Bank, This was the first time Plaintiff received this document and to date, it is the only agreement of any kind Defendant has provided to Plaintiff, Defendant claims in his motion that plaintiff received Exhibit 'A" prior to the document inspection, Yet, it does not allege how Plaintiff could have received the document prior to the inspection and in fact, Plaintiff did not receive it until after the document inspection, Plaintiff has not been granted complete access to the Midstate's books and records, Motion at 1110, and thus brings this motion to compel the production of Midstate's corporate books and records, III, ISSUES PRESENTED Is Plaintiff entitled to preemptory judgment when it is clear that (1) Plaintiff is a shareholder of Midstate, (2) he has requested to examine Midstate's corporate books and records in a verified leiter, and (3) he has sought Midstate's books and records for a proper purpose? Suggested answer in the affirmative, - 3 - IV, ARGUMENT If Plaintiff's rights are clear, the court may enter preemptory judgment in a mandamus action at any time after the filing of the Complaint. Pa,R.C,P, 109B, The standard for granting a preemptory judgment is analogous to the standard governing the disposition of motions for summary judgment. Washowich v McKees Municioal Water Authoritv, 94 Cmwlth, Ct. 509, 503 A,2d 1084 (1986), Preemptory judgment in a mandamus action is appropriately entered only where there exists no genuine issue of materl. fact, and petitioner's entitled to judgmllnt as a matter of law, Standard Pennsvlvania Practice Second, Volume 18, Section 99: 97 at pp, 402-403, Every shareholder of a Pennsylvania corporation has the right to inspect the books and records of the corporation pursuant to the Pennsylvania Business Law of 19B5, 15 Pa,C,S,A, 9 1508, Pennsylvania Business Law of 19B8 also specifies when the court shall summarily grant a shareholder the right to examine the corporate records, It provides that the court shall sllmmarily grant this right when the shareholder establishes: "(1) [t]hat he has complied with the provisions of this section respecting the form and manner of making demand for inspection of the document[;] (2) [t]hatthe inspection he seeks is for a proper purpose." 15 Pa,C,S,A, 91508(c), In the case at hand, it has been established that Plaintiff is a shareholder of Midstate, Answer at ~ 3, Moreover, in a verified letter dated November 1, 1996, Plaintiff - 4 - requested that Midstate permit him to inspect its books and records and articulated his proper purpose in requesting the inspection, Motion, Exhibit "A", Plaintiff was not provided any access until after initiation of this suit, on February 26, 1998, Preemptory Judgment Motion ('Motion") at 8, As discussed earlier, his provision of records was woefully inadequate because it failed to include many signifiCdnt corporate documents such as Midstate's bylaws, corporate minutes, any correspondence directed to Midstate or originating from Midstate, Plaintiff's personnel record, any corporate tax returns, and any documents reflecting the negotiation and sale of the billboard business to Whiteco, Motion at 1J10, In the other case between the two parties, at Court of Common Pieas, Cumberland County, 97-5947 Civil Term, as Exhibit "A', Defendant attached to its answer as Exhibit 'A" an alleged indemnification agreement which provided operating capital to Midstate,2 Motion at1J13, This document was also not provided in the February 26, 1998 record review, Motion at1J14, Defendant alleges that Plaintiff received this document prior to the February 26, 1998 inspection, Plaintiff, however, did not receive this document until it received Defendant's Answer Together with New Matter and Counterclaims which was not filed until March 6, 199B, Plaintiff's right to inspection is clear and the facts underlying such right are not disputed, So long as the request for inspection is for 2 proper purpose and complies with the requirements of the statute, the right to inspect must be granted, 15 Pa,C,SA 9 1508; ~ ~ Friedman v Altoona Pioe and Steel Co" 460 F,2d 1212 (3d,Cir, 1972), Section 'A copy of the alleged indemnification agreement is attached to the Motion as Exhibit '8', - 5 - 1508(b) provides that '[al proper purpose shall mean a purpose reasonably related to the interest of the person as a shareholder,' Plaintiffs purpose for inspection is proper in that Plaintiff seeks to understand the business operations and financial status of Midstate as well as analyze and understand the nature and extent of his financial interest concerning Midstate, Motion, Exhibit 'A". Defendant has admitted that Plaintiff is a shareholder who has not been given access to all of Midstate's corporate books and records, Defendant in its second suggested order asks that the Court require Defendant to respond only to specific requests, In response to these specific requests, Midstate suggests that it need only inform Plaintiff of the documents location, if known, Section 150B of Pennsylvania's Business Law, 15 Pa,C,SA 9 150B, requires the corporation to produce the corporate books and records, Plaintiff is entitled to review the documents not just learn of their location, There is no reason to require Plaintiff to go forward on a 'treasure hun\", Under section 1508, disclosure of the records' location is not sufficient. While Plaintiff has been as specific as possible regarding the documents requested, Plaintiff is entitled to review 211 corporate documents irrespective of whether Plaintiff currently knows of their existence, Defendant's suggestion of requiring Plaintiff to specify the requested documents will simply facilit~te a 'cat and mouse game.' Defendant has already failed to produce to Plaintiff a document it later used as an exhibit in its Answer, In addition, the corporate bylaws only appeared after Plaintiff filed his Preemptory Judgment Motion, Defendant has not been forthcoming with documents and thus, a court order mandating the production of all corporate books and records is necassary, - 6 - V, CONCLUSION For the foregoing reasons, Plaintiff requests that the Court grant his Motion for Preemptory Judgment and enter an Order requiring Defendant to permit Plaintiff to examine all books and records of Midstale and to award Plaintiff his costs in this action, METTE, EVANS & WOODSIDE By: ~ .kj j)~f'- DAN EL L. SULLIVAN, ESQUIRE Supreme Court 1,0, /ll34548 ELIZABETH GOLDSTEIN DIXON, ESQUIRE Supreme Court 1.0, /ll73779 3401 North Front Street P,O, Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 Allorneys for Plaintiff DATED: 5 - H-q~ I' - 7 - \ ~ I j . . "'''.., .. ..' t ,... . '" , --' MAY 21 ~ \LA I here~Plfi this I b of 1~i7~lIed of .--'( ~d:::.- ",A t::.-<--- .. Anomey for CUNNINGHAM" CHERNICOFF, P,C, 2320 N, SECOND STREET HARRISBURG, PENNSYLVANIA 17110 (717) 238-6570 \ :;..''"''....''''.."..-....-.. . ... . . ,.... " ( . , 1,; t' .-" , I '. , \ , , 1 \ I , \ ,.-. \\ ~- ,;';"';:'7~.-""___ ~.-;;--,........~:.:..:....-=-""':.-!.:-?~.'f"""':"'-- , " RANDAL L. FISHEL, Plaintiff IN 'rHE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v, NO, 97-5946 CIVIL TERM MIDSTATE COMMUNICATIONS CORPORATION, JURY TRIAL DEMANDED Defendant DEFENDANT'S. MIDSTATE COMMUNICATIONS CORPORATION'S. BRIEF IN OPPOSITION OF PLAINTIFF'S MOTION FOR PREEMPTORY JUDGEMENT AND NOW, comes Defendant, Midstate communications . Corporation ("Midstate"), by and through its attorneys, cunningham & Chernicoff, P.C" and files its Brief in opposition of Plaintiff's Motion for Preemptory Judgment and in support thereof, avers as fol~ows: I I 1 I I i I I 1 i I. PROCEDURAL HISTORY The procedural history is set forth in Plaintiff's Brief is adopted herein as in more fully set forth. In addition to Plaintiff's recital of the procedural history, it should be noted that Plaintiff has had numerous opportunities to review the documents that Midstate has been ablB to locate. In fact, the Defendant has provided Plaintiff with copies of all specific documents as requested by the Plaintiff. As a result o!:i:he copy request of the Plaintiff, Defendant provided copies in excess of 270 documents, II, STATEMENT OF FACTS Despite the contentions of the Plaintiff in this matter, Defendant has provided the Plaintiff with ample opportunity to review all documents that Defendant has been able to locate and obtain. It is important for this Court to note and understand that the Defendant corporation is no longer in existence, and as such, there is no central repository for corporate recordS. Upon dissolution of the corporation, it is believed that some documents, as sought by Plaintiff, were - either taken by the individual shareholders or discarded, As of this date, it is unknown as to which documents may exist, and if any such documents exist, where such documents may be located. Furthermore, as a result of the Defendant's demise, no individual party was available to bear the burden of the cost of storage necessary to retain all documents as generated during the Defendant's corporate existence, Therefore, it is easy to see why some of the corporate documents alleged to exist by the Plaintiff simply do not exist, I 2 ii II III, ISSUE PRESENTED A. WHETHER PLAINTIFF IS ENTITLED TO PREEMPTORY JUDGMENT WITH RESPECT TO ITS COMPLAINT IN MANDAMUS, WHEN DEFENDANT, MIDSTATE COMMUNICATION CORPORATION, HAS PERMITTED PLAINTIFF ACCESS TO ALL CORPORATE DOCUMENTS THAT DEFENDANT HAS BEEN ABLE TO LOCATE? suggested Answer in the Negative, IV. ARGUMENT Pennsylvania Rule of civil Procedure 1098 provides that a court may enter preemptory judgment in an action for mandamus at any time after the filing of the Complaint. The standard by which Rule 1098 is applied is substantially similar to the standard as applied to determining motions for summary judgment, ~~ Washowich v. McKees Municioal Water Authority, 94 Cmwlth.Ct. 509, 503 A.2d. 1084 (1986), However, before preemptory judgment may be issued with respect to a an action in mandamus, it must be established that no genuine issues of material facts exist and that the moving party is entitled to judgment as a matter of law. ~ It is admitted that in certain circumstances, it a party can establish its role as a shareholder and further establish that the requested inspections are for a proper purpose, no genuine issue of material fact would exist, However, not 3 Jr every shareholder is au.:omatically entitled to preemptory judgement without further evaluation of merits underlying the alleged claim, In the instant matter. a review of the underlying alleged claim, creates a dispute of genuine issues of material fact, and as such, precludes the proper entry of preemptory judgment. While it is admitted that while the Plaintiff was a - shareholder of the Defendant corporation. It is denied that the Plaintiff's requested inspection of corporate documents is for a proper purpose, Plaintiff has stated on numerous times that the stated purpose for the inspection of the Defendant corporation's records is to "understand the business operations and financial status of Midstate." (Plaintiff's Brief in Support of Motion of Preemptory Judgment, p, 6), It is important for this Court to remember that Plaintiff was the general manager of the Defendant corporation and as i! such, exercised control over the daily operationD and the financial affairs of the corporation. Therefore, any request by the Plaintiff to review corporate documents in order to determine the financial or business operation of the Defendant 4 corporation is simply without merit. PlaintifZ has personal and first hand knowledge as to the daily operations and financial affairs of the Defendant corporation and as such, the stated purpose for the requested inspection is not proper, Notwithstanding the above, Defendant has complied with the Plaintiff I s request to inspect all corporate documents available to the Defendant. The Defendant has provided the - Plaintiff an opportunity to review documents contained in approximately in twenty (20) boxes worth of material and as a result of Plaintiff's request, Defendant had made in excess of two hundred seventy (270) copies and provided the same to the Plaintiff, Defendant, Midstate communication Corporation, is no longer in eXlstence, and as such, the whereabouts of a r, Ii II j' majority of the records pertaining to corporate business are unknown. It should be noted since the inception of this action, Defendant has been actively attempting to locate possible repositories in which corporate documents may be found. In fact, on May 15, 199B, Defendant's counsel contacted Plaintiff's counsel and indicating that additional documents had been located and had requested possible dates from Plaintiff's counsel for the inspection of such documents, i 5 Defendant understands that the request for production of documents as submitted by the Plaintitf is continuous in nature, upon discovery of any additional documente subject to Plaintiff's request, that Defendant will notify Plaintiff's counsel and will make such documents will be made available for review by Plaintiff or Plaintiff's counsel, However, the possibility of additional documents being discovered at some point in the future is not proper grounds for a preemptory . jUdgment. In addition in request to review corporate documents and records, Plaintiff has made specific request to review corporate tax returns for various tax filing years. While Defendant is in possession of these documents, Defendant believes, and therefore avers, that Plaintiff is not entitled to such documents until such time as he has paid his pro rata share for the prepa~'ation of such returns. The corporate tax returns in question were prepared at the request and paid for by the individual shareholders, plaintiff, in the instant matter, has failed to submit his pro rata share for the preparation of any tax returns and as a result, the remaining shareholders were forced to inc~r his proportionate cost of 6 the preparation of the tax returns, The cost for the preparation of the 1993, 1994 and 1995 tax returns was 1~elve Thousand Five Hundred and No/100 Dollars ($12,500.00). In light of the failing nature of the defendant corporation, this cost was exclusively absorbed by the individual shareholders, based upon their respective shareholder percentages. Plaintiff failed, and continues to fail, to submit his proportionate share for the preparation of the tax returns, and as such, was never provided with a copy of such returns. . Plaintiff I S attempt to obtain the tax returns is an unfair attempt by the Plaintiff to obtain the benefits of the information contained in the tax returns without the obligation of paying for such returns to be prepared, Any argument by Plaintiff that the tax returns are necessary to establish the financial situation and/or business operations of the Defendant corporation is simply without merit for the reasons stated earlier. The Plaintiff was the general manager of the Defendant corporation and exercised the control over the daily operations and financial affairs of the corporation itself. 7 , section l508(b) of the Pennsylvania Business Corporation Law, provides, pertinent partr "every shareholder shall, upon written verified demand stating the purpose thereof, have a right to examine, in person or by agents or attorney, during usual hours for business for any proper purpose, the share register, books and records of account, and records of proceeding of the incorporators, shareholders and directors - and to make copies or extracts therefrom." 15 Pa.C,S.Jt, ~l508(b), Conspicuously absent from the Pennsylvania Business corporation Laws statutory authority is the right to inspect corporate tax returns, Absent Plaintiff SUbmitting his proportionate share of the cost to prepare the tax returns, or some authority granting an unequivocal right to the tax returns, Defendant believes that the Plaintiff has not established a right to inspect the tax returns. I 8 CERTIFICATE OF SERVICE I, Edwin A.D, Schwartz, Esquire, do hereby certifY that a true and correct copy of the DEFENDANT'S. MIDSTATE COMMUNICATIONS CORPORATION'S. BRIEF IN OPPOSITION OF PLAINTIFF'S MOTION FOR PREEMPTORY JUDGEMENT in the above- captioned matter was placed in the United States Mail, postage prepaid in Harrisburg, Pennsylvania on May 21, 1998, on the following: Elizabeth Goldstein Dixon, Esquire METTE, EVANS & WOODSIDE 3401 North Front Street P,O. Box 5950 Harrisburg, PA 17110-0950 (Attorneys for plaintiffs) . Date: Mav 21. 1998 Respectfully submitted, CUNNINGHAM & CHERNICOFF, P.C, ~:?;::/" /~01 By: ~~- .;/ Edwin A,D. Schwartz, Es I. 0, 875902 ---.. 2320 North Second Street P,O, Box 60457 Harrisburg, PA 17106-0457 (717) 238-6570 (Attorneys for Defendant) I " jI ;i :1 10 ,- ,'J ( L '. , . U (''; , ; <.;.. , :';'. I ..., C I . l. 1 . . L' (; ~.J l.) ,-' . . . . ,., Cl. o ... - ... ~ o ... .., :l " .5 , ..'" .. " 0 A ... o l! -- .. 0 5'" u ~G '6: ... .- .. ,., .c -e 0 II u .<:-5 -- o o U ... a: r:: If ~ ih i ~IIIN wa. .... :lUl - ~ mz~ t:. !;~il ZN!!! Z II: B ! ~ .g .... ... E 9 ;;: . . .. .. '. CUNNINGHAM lit CHERNICOFF. P.C. - . APR 1 3 1998 f/J RANDAL L. FISHEL, Plaintiff IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. MIDSTATE COMMUNICATIONS CORPORATION, Defendant CIVIL ACTION - LAW NO, 97-5946 ORDER UPON CONSIDERATION of Plaintiff 's, Randal L, Fishel's, Motion for Preemptory Judgment and the Reply as filed by Defendant, Midstate communications Corporation, regarding the inspection of corporate books and records, IT IS HEREBY ORDERED, that Defendant, Midstate communications Corporation, shall respond to only to a document request if such request is specific; and Defendant, Midstate communication Corporation shall be required to reply only to the existence or location of such document, If such document is not available or its existence is unknown, Midstate Communications corporation shall not be required to produce the same, BY THE COURT, J, B RANDAL L, FISHEL, I , , Plaintiff . , v, , , MIDSTATE COMMUNICATIONS , , CORPORATION, , , Defendant . , IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW NO. 97-5946 DEFENDANT~' REPLY TO PLAINTIFF'S MOTION FOR PREEMPTORY JUDGMENT AND NOW, comes Defendant, Midstate communications Corporation, by and through their counsel, CUnningham & Chernicoff, P,C" and files this Reply to Plaintiff's Motion for Preemptory Judgment pursuant to Pennsylvania Rule of Civil Procedure 1098, 1 , Admi tted, 2, Admitted, 3, Admitted, 4, Admitted, 5, Admitted in part and denied in part, It is admitted that the letter sets forth the statements contained in Paragraph 5 of Plaintiff's Motion, It is denied that the inspection is for a proper purpose, 6. Admitted, By way of further response, the requests made by plaintiff to inspect the books and records of Defendant Hid state were received by Defendant and Defendant's counsel and any delay as to the inspection of such books and records was the result of conflicting schedules between the parti.s, 7, Denied as stated, The pleading speaks for itself, 8, Admitted, By way of further answer, originally the parties had agreed that Plaintiff would be allowed to review certain records of Hidstate on Thursday, January 29, 1998, However, despite such scheduling, Plaintiff and Plaintiff's counsel failed to appear for the review of records scheduled for Thursday, January 29, 199B at the office of Defendant's counsel without prior notification, 9, Denied as stated. Plaintiff was pernu.tted access to all records currently in possession of Defendant's counsel on February 26, 1998, By way of further answer, Defendant, Midstate communications corporation, ceased its business operations on June 3, 1997, and as a result, some records no longer exist or the location of certain records are unknown, 2 By way of further answer, on February 26, 1998, plaintiff and Plaintiff's counsel, after inspection of the records in Defendant's counsels' possession, made a request of Defendant's counsel to copy approximately two hundred seventy- eight (278) pages of the records that were made available to Plaintiff for inspection, 10, Admitted. By way of further answer, as a reeult of Defendant, Midstate Communications corporation, ceasing its business operations on June 3, 1997 it is unknown whether all of these documents exist or the location as to certain of these documents, With respect to any tax returns or tax related information, it should be noted that the individual shareholders, except for Plaintiff, have paid for the preparation of their respective portions of the tax returns and to date Plaintiff, Randal Fishel, has failed to pay his proportionate share of preparation of such returns, Defendant is willing to release any such tax information as the Plaintiff has requested upon receipt of the appropriate payment by Plaintiff for his proportionate share of the cost for the preparation of such returns, 11. Admitted, 12, Admitted, 3 13, Admitted, 14, Admitted, By way of further answer, Defendant' 8 counsel had previously provided aforementioned the indemnification agreement to Plaintiff's counsel. In light of Plaintiff's counsel having previously received, prior to the institution of the subject litigation, the indemnification agreement, such was already in Plaintiff's counsel's file and would have been superfluous to provide again. Further, because it was previously provided to Plaintiff's counsel, the agreement was in the Defendant's attorney's litigation file and was not contained in tne documents available for review. WHEREFORE, Defendant, Midstate communications Corporation, respectfully request this Honorable Court to deny Plaintiff's Motion for Preemptory Judgment and to award Defendant all such further relief as is proper and just. Respectfully submitted, Date: ADril ~ 1998 P.c. fl~\doc.\roply~ldoc.c. CUNNINGHAM & ~ By: -&_' Robert E. Chernico( , Esquire I. 0, '23380 Edwin A,D, Schwartz, Esquire I,D, , 2320 North Second Street P,O, Box 60457 Harrisburg, PA 17106-0457 (717) 238-6570 (Attorneys for Defendants) 4 CERTIFICATE OF SERVICE I, Edwin A,D, Schwartz, Esquire, do hereby certify that a true and correct copy of the Defendants' Reply to Plaintiff's Motion for Preemptory Judgment in the above- captioned matter was placed in the United state~ Mail, first class delivery on April -1C, 1998 on the following: Daniel L, sullivan, Esquire Elizabeth Goldstein Dixon, Esquire Mette, Evans & Woodside 3401 North Front Street P,O, Box ~950 Harrisburg, PA 17110-0950 (Attorneys for Plaintiff) Respectfully SUbmitted, Date: ADril ~ 1998 CUNN~~ & By: ~:.- Edwin A,D, Schwart~ Esquire I.D, II 2320 North Second Street P,O, Box 60457 Harrisburg, PA 17106-0457 (717) 238-6570 (Attorneys for Defendants) P.c. 5 \ ~ I ) ." .,,-.~",- . . . . . CUNNINGHAM. CHERNICOFF, P,C, 2320 N, SECOND STREET HARRISBURG, PENNSYLVANIA 17110 (717) 238-6570 I hereby ~~lhIS lo~al e~. d j9trecl copy of Ihe 2!;tila~ d of re or ,/.>/./ ~//, o~ A:fo~e~r- ~- /~-(AP~~~ 1958 ~ <- - . " , I . , I " , , . \ , ! . ,._. ~- \ ;,;.;;.7-....-:..- ~ :-...~ _.,~.:.:....:::.-.......-l.:...l!..:~-\ -1'.{ , RANDAL L, FISHEL, Plaint!!f :IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PENNSYLVANIA v. MIDSTATE COMMUNICATIONS CORPORATION, Defendant :CIVIL ACTION - LAW :NO, 97-5946 ORDER UPON CONSIDERATION of plaintitt's, Randal L, Fishel's, Motion for Preemptory Judgment and the Reply as filed by Defendant, Midstate Communications Corporation, reg~rding the inspection of corporate books and records, " IT IS HEREBY ORDERED, that Plaintiff's Motion for Preemptory Judgment is denied. ti BY THE COURT, . :1 , ,I I, II I I I J, . RANDAL L, FISHEL, plaintiff :IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PENNSYLVANIA : v, MIDSTATE COMMUNICATIONS CORPORATION, Defendant CIVIL ACTION - LAW NO, 97-5946 ,I 1 " ;i ORDER I UPON CONSIDERATION of Plaintiff's, Randal L, Fishel's, Motion for Preemptory Judgment and the Reply as file" by Defendant, Midstate communications corporation, regarding the inspection of corporate books and records, :: " 'I I, I IT IS HEREBY ORDERED, that Defendant, Midstate Communications corporation, shall respond to only to a document request if such request is specific: and Defendant, Midstate Communication corporation shall be required to reply only to the existence or location of such document. If such document is not available or its existence is unknown, Midstate communications Corporation shall not be required to produce the same, :1 , 'I I, )i BY THE COURT, J, 1 :1 I' i I I I 8 RANDAL L. FISHEL, Plaintiff IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v, MIDSTATE COMMUNICATIONS CORPORATION, . . CIVIL ACTION - LAW NO. 97-5946 Defendant . , I ,I DEFENDANTS' REPLY TO PLAINTIFF'S MOTION FOR PREEMPTORY JUDGMENT AND NOW, comes Defendant, Midstate communications Corporation, by and through their counsel, cunningham', Chernicoff, P.c., and files this Reply to Plaintiff's Motion for Preemptory JUdgment pursuant tl' Pennsylvania Rule of Civil " Procedure 1098, i (') ,:) , , I ~;- ':'J ,\ , 1. Admitted, ,~ . ~l -n I' t! -- , , \ .J Ii 'D , .""'"'\ 2 , Admitted, f',. .':1 !"'I .-,1 ..... I.": ". . ':...' ,')1''' " 'J1 ' . -J 'u 3, Admitted, . (,,) ~ I Ii 4, Admitted. 5, Ad~itted in part and denied in part, It is admitted that the letter sets forth the statements contained in Paraqraph 5 of Plaintiff I s Motion, It is denied that tha I !! il 1 'i I: inspection is for a proper purpose. il II II !I il I, 11 I' I II I 6, Admitted. By way ot turther response, the requests made by Plaintitt to inspect the books and records ot Defendant Midetate ware received by Defendant and Defendant's counsel and any delay as to the inspection ot such booka and records was the result ot contlicting schedule. between the partie., 7. Denied as stated, The pleading speak. tor it.elf; 8, Admitted. By way of further answer, originally the rsrties had agreed that Plaintitt would be allowed to review certain records ot Midstate on Thursday, January 29, 1998. However, despite such scheduling, Plaintiff and Plaintitt 'a counsel failed to appear tor the review ot records scheduled tor Thursday, January 29, 1998 at the ottice ot Detendant'. counael without prior notification, 9, Denied as stated. Plaintift was permitted access to all records currently in possession ot Detendant's counsel on FebrulJry 26, 1998. By way of further answer, Defendant, Midstate COllllllunicbtions Corporation, ceased its business operations on June 3, 1997, and as a result, aome recorda no longer exiAt or the location of certain records are unknown, 2 13. Admitted. 14, Admitted, By way ot further answer, Detendant's counsel had previously provided aforementioned the indemnification agreement to Plaintiff's counsel. In light of Plaintiff's counsel having previously received, prior to the institution of the subject litigation, the indemnitication agreement, such was already in Plaintitt's counsel's tile and would have been superfluous to provide again. Further, becaUlle I' i it was previously provided to Plaintiff's counsel, the agreement was in the Defendant's attorney's litigation file " 01 and was not contained in the documents available tor review. " WHEREFORE, Defendant, Midstate Communications Corporation, respectfully request this Honorable Court to deny Ii Plaintitf' s Motion tor Preemptory JudgDlent and to award Detendant all such further relief as is proper and just, Respectfully submitted, Date: ADril if: 1998 CUNNINGHAM' p.e, '/.4' By: -c!~' Robert E, Chernico( ,'Esquire I. D. '23380 Edwin A.D. Schwartz, Esquire I,D, , 2320 North Second Street P,O, Box 60457 Harrisburg, PA 17106-0457 (717) 238-6570 (Attorneys for Detendants) I' :1 " !I , , f,~\doc.\roply~ldol'l. 4 r CERTIFICATE OF SERVICE I, Edwin A,P, Schwartz, Esquire, do hereby certity that a true and correct copy ot the Detendants' Reply to Plaintitt's Motion for Preemptory Judgment in the above- captioned matter was placed in the United States Mail, tirst class delivery on April sr, 1998 on the tollowing: Daniel L, Sullivan, Esquire Elizabeth Goldstein Dixon, Esquire Mette, Evans , woodside 3401 North Front Street P,O, Box 5950 Harrisburg, PA 17110-0950 (Attorneys tor plaintitt) :i 'I :i " Respectfully submitted, !i I, I, I II ,I Date: ADdl 'T: 19lU1. CUNN~J," ' By: &'-- Edw n A, D, Schwartll..l~ Esqu re I,D, . 2320 North Second Street P.O, Box 60457 HarriSburg, PA 17106-0457 (717) 238-6570 (Attorneys tor Detendants) FF, p.e. -'" II '. ii r I 5 I. VERIFICATION I, Michael schatz, Vice President, Midstate communications Corporation, verify that the statements made in the foregoing Defendants' Reply to Plaintiff's Motion for Preemptory Judgment are true and correct to the best of my " , knowledge, information and belief. I understand that false :i statements herein are made subject to the penalties of 18 Pa, C,S,A. Section 4904, relating to unsworn falsiHcation' to authorities. ,I ;, , I " I , . )'A' " / ;' I, I Michael Schatz / vice President, Midstake communications Corp, ii I' I I I Datel II: /-,,:, . . " , II , I I II 6 .. , ~ " I ) . " ~~ ~ ._.... t- -if . . ! . .. . (7l7) 238.6570 ....- CUNNINGHAM' CHERNICOFF, P,C. 2320 N. SECOND STREET HARRISBURG, PENNSYLVANIA 17110 . . i I . .. (.' ., f , t (' \ '. ., I , , I , \ ,.... ~- - _h_.,...- '\ .'~--. ..7:._--,,-,,""'_".~''''-::~~M- II '! RANDAL L, FISHEL, plaintitt :IN THE COURT or COMMON PLEAS : CUMBERLAND COUNTY, PENNSYLVANIA v, MIDSTATE COMMUNICATIONS CORPORATION, Detendant CIVIL ACTION - LAW NO, 97-5946 :1 !I !I i! I' I: i ORDER UPON CONSIDERATION at Plaintitt 's, Randal L. Fishel's, Motion tor Preemptory Judgment and the Reply as tiled by Defendant, Midstate communications corporation, regardinq the inspection ot corporate books and records, IT IS HEREBY ORDERED, that Plaintiff's Motion for preemptory Judgment is denied. ': , I, :i " I , il , if [, :1 I i BY THE COURT, J, RANDAL L. FISHEL, PlaintHf : IN THE COURT OF COMMON PT..EAS : CUMBERLAND COUNTY, PENNSYLVANIA v, MIDSTATE COMMUNICATIONS CORPORATION, Defendant :CIVIL ACTION - LAW :NO. 97-5946 ORDER , 'I d UPON CONSIDERATION of Plaintiff'S, Randal L. Fishel's, Motion for Preemptory Judgment and the Reply as filed by Defendant, Hidstate communications corporation, regarding the inspection of corporate books and records, . ii I :i i I IT IS HEREBY ORDERED, that Defendant, Hidstate communications corporation, ~hall respond to only to a document request if such request is specific: and Defendant, Midstate communication corporation shall be required to reply only to the existence or location of such document. If such document is not available or its existence is unknown, Midstate communications corporation shall not be required to produce the same, Ii i; II II :i i! I ! BY THE COURT, J, I 'I II I' I i 8 RANDAL L, FISHEL, Plaintiff IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA I v, MIDSTATE COMHONI~7IONS CORPORATION, CIVIL ACTION - LAW : NO, 97-5946 Defendant DEFENDANTS' REPLY TO PLAINTIFF'S MOTION FOR PREEMPTORY JUDGMENT AND NOW, comes Defendant, Midstate communications ': Corporation, by and through their counsel, CUnningham & Chernicoff, P,C., and files this Reply to Plaintiff's Motion for Preemptory Judgment pursuant to Pennsylvania Rule of Civil Procedure 1098. _. :i 1. Admitted. 2, Admitted, ~ . -, 3, Admitted, q !: 4, Admitted, ..CJ " :.", 1 ., ,! "' ) \- ~ :" I ,,'J \.::'J . , ,'~ ..., , -,:'} ~-,.. '.' 1 .-.1 r-:} , I '.11 -. ~J .... .< il 5, Admitted in part and denied in part, It is admitted 'I d Ii that the letter sets forth the statements contained in I' ,I Paragraph 5 of Plaintiff' Eo Motion. It is denied that the ,. I i: inspection is tor a proper purpose, 6, Admitted, By way of further response, the requests made by Plaintiff to inspect the books and records of Defendant Midstate were received by Defendant and Defendant'. counsel and any delay as to the inspection of such books and records was the result of conflicting schedules between the parties, 7, Denied as stated. The pleading speaks for itself; 'I 8. Admitted, By way of further answer, originally the parties had agreed that Plaintiff would be allowed to review certain records of Midstate on Thursday, January 29, 1998. However, despite such scheduling, Plaintiff and Plaintiff's counsel failed to appear for the review of records scheduled tor Thursday, January 29, 1998 at the otfice of Defendant's counsel without prior notification, " 9, Denied as stated, Plaintiff was permitted access to " all records currently in possession of Defendant's counsel ~o FebruC\ry 26, 1998. By way of further answer, Defendant, Midstate Communications corporation, ceased its business operations on June 3, 1997, and as a result, some records no longer exist or the location of certain records are unknown. 2 . By way of further answer, on February 26, 1998, Plaintiff and Plaintiff's counsel, after inspection of the records in Defendant's counsels' possession, made a request of Defendant's counsel to copy approximately two hundred seventy- eight (278) pages of the records that were made available to Plaintiff for inspection. 10. Admitted, By way of further answer, as a result of Defflndant, Midstate communications corporation, ceasing its business operations on June 3, 1997 it is unknown whether all of these documents exist or the location as to certain of these documents. with respect to any tax returns or tax related information, it should be noted that the individual shareholrlers, except for Plaintiff, have paid for the preparation of their respective portions of the tax returns and to date Plaintiff, Randal Fishel, has failed to pay his proportionate share of preparation of such returns, Defendant is willing to release any such tax information as the Plaintiff has requested upon receipt of the appropriate payment by Plaintiff for his proportionate share of the cost Ii for the preparation of such returns, !i I: ll, Admitted. 12, Admitted, 3 13, Admitted. 14. Admitted, By way ot turther answer, Defendant's counsel previously provided atorementioned the had indemnitication agreement to Plaintitt's coun.el. In light ot Plaintitt'. counsel having previously received, prior to the institution ot the subject litigation, the indemnltication agreement, such was already in Plaintitf's counsel's file and would have been superfluous to provide again, Further, because it was previously provided to Plaintitf's counsel, the 1 agreement was in the Defendant's attorney's 1itigatian tile and was not contained in the documents available for review, I " WHEREFORE, Defendant, Midstate communications 11 :i Corporation, respectfully request this Honorable Court to deny Ii 1'1 Plaintiff's Motion for Preemptory Judgment and to award II Defendant all such turther reliet as is proper and just, Respecttully submitted, Date: Aoril i': 1998 CUNNINGHAM & -d P.C, , II : By: Robert E, Chernico I,D, '23380 Edwin A,D. Schwartz, Esquire I,D, . 2320 North Second street P,O, Box 60457 Harrisburg, PA 17106-0457 (717) 238-6570 (Attorneys for Defendants) f,~'doc.'rlply~ldot.t. 4 I II I , !I 'I I' 'I I! " I' d Ii ,I CERTIFICATE OF SERVICE ;i I, Edwin A,D. Schwartz, Esquire, do hereby certity that a true and correct copy ot the Oetendants' Reply to Plaintitt's Motion for Preemptory Judgment in the above- captioned matter was placed in the United States Mail, tirst class delivery on April ~, 1998 on the tollowing: 'I .i Ii ., " ,. ii I :j ;1 !j Ii ,I Daniel L, SUllivan, Esquire Elizabeth Goldstein Dixon, Esquire Mette, Evans , Woodside 3401 North Front Street P.O. Box 5950 HarriSburg, PA 17110-0950 (Attorneys tor Plaintitt) ii 11 ;1 'j i, Ii Ii II 'I I II II I! Respecttully submitted, CUNN6ENG , ~) By: A-' Edwin A,D, Schwa I,D, II 2320 North Second Street P.O, Box 60457 HarriSburg, PA 17106-0457 (717) 238-6570 (Attorneys tor Detendants) P,C, Date: ADril ~ 1998 re 5 r VERIFICATION I, Michael schatz, Vice president, Midstate communications corporation, verify that the statsments made in the foregoing Defendants' Reply to Plainti ff I s Motion for Preemptory Judgment are true and correct to the best of my I knowledge, information and belief, I understand that false statements herein are made subject to the penalties of 18 Pa. C,S,A. Section 4904, relating to unsworn falsification" to authorities. , I " I , , ; /,--1-. ',. ,r/l d Michael Schatz / Vice president, Midstate Communications corp, Ii Ii I! " Date: I_ I! : I ': I I, ij 11 ,I il I , 6 : ~ I ) . .:..,~.. , . CUNNINGHAM & CHERNICOFF, P.C, 2320 N, SECOND STREET HARRISBURG, PENNSYLVANIA 17110 (717) 238-6570 "~"",~"~-"~"'''''' ,-.--'" . . .;,,#0 '. ( . , " ',' " :t r , \ f I \ ~- ._;._":Y~ __::~__\-~ _~.. , I RANDAL L. FISHEL, Plainti ff :IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PENNSYLVANIA v. MIDSTATE COMMUNICATIONS CORPORATION, Defendant :CIVIL ACTION - LAW :NO, 97-5946 ORDER UPON CONSIDERATION of plaintiff'S, Randal L, Fishel'S, Motion for Preemptory Judgment and the Reply as filed by Defendant, Midstate communications corporation, re9arding the inspection of corporate books and records, IT IS HEREBY ORDERED, that Plaintiff's Motion for Preemptory Judgment is denied. BY THE COURT, J, i I I Ii !i II II II I. " RANDAL L. FISHEL, Plaintiff :IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PENNSYLVANIA v, MIDSTATE COMMUNICATIONS CORPORATION, Defendant :CIVIL ACTION - LAW :NO. 97-5946 ,I ORDER UPON CONSIDERATION of Plaintiff's, Randal L, Fishel's, Motion for Preemptory Jud9lllent and the Reply as filed by Defendant, Midstate Communications corporation, regarding the inspection of corporate books and records, IT IS HEREBY ORDERED, that Defendant, Midstate Communications corporation, shall respond to only to a document request if such request is specific; and Defendant, Midstate Communication corporation shall be required to reply only to the existence or location of such document, If such document is not available or its existence is unknown, Midstate Communications corporation shall not be required to produce the same, BY THE COURT, J, .1 8 [I :i !i ij Ii Ii ! " i; RANDAL L, FISHEL, Plaintitt IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v, MIDSTATE COMMUNICATIONS CORPORATION, CIVIL ACTION - LAW NO, 97-5946 I 'I d Detendant I, i! , II II :1 DEFENDANTS' REPLY TO pr~INTIFF'S MOTION FOR PREEMPTORY JUDGMENT AND NOW, comes Defendant, Midstate communications , corporation, by and through their counsel, CUnningham , Ii Ii " Ii II II " II II II Chernicotf, P.C., and files this Reply to Plaintiff's Motion tor Preemptory Judgment pursuant to Pennsylvania Rule of civil Procedure 1098, ;-, ~, . '0 (--l C.) .,. :~ ,'1 , '. ,11 J I ,'T1 ,r} It) I,~ :-! j':i\ ."1\ , ---} ~..' .(~ ~~ . .(1 ir...) "'oJ :11 ::n 'oJ -< 1. Admitted. 2, Admitted, . , -. J, Admitted, 4, Admitted, 5, Admitted in part and denied in part, It is admitted that the letter sets forth the statements contained in Paragraph 5 of Plaintiff's Motion, It is denied that the inspection is tor a proper purpose, , il 6, Admitted. By way ot turther response, the requests made by Plaintitt to inspect the books and record. ot Detendant Midstate were received by Detendant and Detendant's counsel and any delay as to the inspection ot such books and records was the result ot contlicting schedul.s betw..n the partie.. 7, Denied as stated, Tbe pleading speaks tor its.lf. :! !1 I! 8. Admitted. By way ot turther answer, originally the parties had agreed that Plaintitt would be allowed to review certain records ot Midstate on Thursday, January 2~, 1998. However, despite such scheduling, Plaintitt and Plaintitf's counsel tailed to appear tor the review ot records scheduled tor Thursday, January 29, 1998 at the ottice ot Detendant's coun~el without prior notification, 9, Denied as stated, Plaint1tt was permitted access to all r~~ords currently in possession ot Detendant'. counsel on February 26, !.998. By way ot turther answer, Detendant, Midstate Communications Corporation, ceased its business operations on June J, 1997, and as a result, some records no longer exist or the location ot certain records are unknown, 2 By way of further answer, on February 26, 1998, Plaintiff and Plaintiff's counsel, after inspection of the records in Defendant's counsels I possession, made a request of Defendant's counsel to copy approximately two hundred seventy- eight (278) pages of the records that were made available to Plaintiff for inspection, 10. Admitted. By way of further answer, as a result of Defendant, Midstate communications corporation, ceasing its business operations on June 3, 1997 it is unknown whether all of these documents exist or the location as to certain of these documents, with respect to any tax returns or tax related information, it should be noted that the individu&l shareholders, except for Plaintiff, have paid for the preparation of their respective portions of the tax returns and to date Plaintiff, Randal Fishel, has failed to pay his proportionate share of preparation of such returns, Defendant is willing to release any such tax information as the Plaintiff has requested upon receipt of the appropriate payment by Plaintiff for his proportionate share of the coat d for the preparation of such returns, Ii ;! 11. Admitted. 12, Admitted, 3 . CERTIFICATE OF SERVICE I, Edwin A.D, schwartz, Esquire, do hereby certify that a true and correct copy of the Defendants' Reply to Plaintiff I s Motion for Preemptory Judgment in the above- captioned matter was placed in the United States Mail, first class delivery on April -5(, 1998 on the following: i , Daniel L, Sullivan, Esquire Elizabeth Goldstein Dixon, Esquire Mette, Evans , Woodside 3401 North Front Street P,O, Box 5950 Harrisburg, PA 17110-0950 (Attorneys for Plaintiff) , '; i' Ii i, Ii Respectfully submitted, CUNN~," ' By: &.~ Edwin A,D. I,D, . 2320 North Second Street P,O, Box 60457 Harrisburg, PA 17106-0457 (717) 238-6570 (Attorneys for Defendants) P,C, Date: ADril '?': 1998 re II ,! i! q Ii I , II !' 5 VERIFICATION I, Michael Schatz, vice president, Midstate communications corporation, verify that the statements made in the toregoing Defendants I Reply to Plaintiff I a Motion for Preemptory Judgment are true and correct to the beat ot my knowledge, information and belief, I understand that tals. statements herein are made subject to the penalties of 18 Pa, C,S,A. Section 4904, relating to unsworn falsitication to authorities, , I I ,'I ~ ' Michael Schatz Vice president, , /. J- . .- ,r/I Midstaie communications Corp, Date: ! / : (,.;:' , 6 v, IN THg COURr OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW RANDAL L, FISHEL, Plaintiff HIDSTATE COMMUNICATIONS CORPORATION, Defendant NO, 97-5946 CIVIL TERM AND NOW, this ORDER OF COURT LCtLday of March, 1998, upon consideration of Plaintiff'e Motion for Preemptory Judgment, a Rule ie hereby issued upon the Defendant to show cause why the relief requested should not be granted, RULE RETURNABLE within 20 days of service, BY THE COURT, Daniel L. Sullivan, Esq, Elizabeth Goldstein Dixon, 3401 North Front Street P,O, Box 5950 Harrisburg, PA 17110-0950 Attorneys for Plaintiff Edwin A,D, Schwartz, Esq, 2320 North Second Street P,O, Box 60457 Harrisburg, PA 17106-0457 Attorney for Defendant Esq, e~u..... (l.",~<A 3J.l.o/9S" ..J, '6l. f:! .0 q co , -:. ~. :~ . f":,c " , .; , 'I[Y ,:~l .. "J . <::0 ;~ ., , .:). >~I" } ;>>. ,;~ :..: ,'1 j.. '~" - 'P \; - .',. . ., ~:-l ~ :..> ~ .v Ire MAR 1 9 1998 tP Randal L, Fishel Plaintiff : Court of Common Pleas : Cumberland County. Pennsylvania v, : Civil Action .Law Mldstate Communications Corporation Defendant : No, 97-5946 ORDER Ills hereby ORDERED that Defendant Midstate Communications Corporation within _ days of this Order permit Plaintiff to inspect IDl corporate books and records including but not limited to Midstate's bylaws, corporate minutes, any correspondence directed to Midstate or originating from Midstate, Plaintiff's personnel record, any corporate tax returns, and any documents reflecting the negotiation and sale of the billboard business to Whiteco, Failure to comply with this Order will result in contempt sanctions. DATE: J. 114HCl 't I . .......... sv...... Woo-- ATI'OIlNKYe, AT LAW "',.".....u.... .....N..~VANIA '7UO-O'.0 Jf. O. -.oJ& ..ao . I I '. ~ , f I \ ~- .;.;,.....;..~:.:"7'I.~ . :--...... v, : Court of Common Pleas : Cumberland County, Pennsylvania : Civil Action -Law Randal L, Fishel Plaintiff Mldstate Communications Corporation Defendant : No, 97-5946 Motion for Preemotorv Judoment AND NOW, comes the Plaintiff, Randal L. Fishel, by and through his attorneys, METTE. EVANS & WOODSIDE, P,C" and files this Motion for Preemptory Judgment pursuant to Pennsylvania Rule of Civil Procedure 1 09B, 1, Plaintiff filed a Complaint in Mandamus on October 27, 1997, 2, Defendant answered the Conlplaintin Mandamus on December 5. 1997. 3, In paragraph 3 of Defendant's Answer, Defendant admitted that Plaintiff is a shareholder of Mldstate Communications Corporation ("Midstate"), 4, Plaintiff requested In a verified leller to Inspect all of Midstate's corporate books and records, A true and correct copy of this letter is allached hereto, made a part hereof by reference, and marked as Exhibit "A", 5, As the aforementioned letter set forth, the inspection is for a proper purpose In that Plaintiff seeks to understand the business operations and financial status of Midstate as well as analyze and understand the nature and extent of his financial interest concemlng Mldstate. 6, Plaintiff has made numerous requests to Inspect the books and records of Mldstate, These requests date back to November 1, 1996, Complaint at ~ 4, 7, Defendant admiUed In its Answer that Plaintiff had not been given access to Mldstate's corporate rocords, Defendant's Answer at ~~ 4-11, 8, On Thursday, February 26, 199B, Plaintiff was allowed to review certain records of Mldstate, 9, Defendant's provision of records on February 26, 1998 was woefully Inadequate, 10, Business records of Midstate absent from the records on February 26, 199B provided included but were not limited to Midstate's bylaws, corporate minutes, any correspondence directed to Mldstate or originating from Midstate, Plaintiffs personnel record, any corporate tax returns, and any documents reflecting the negotiation and sale of the billboard business to Whileco, 11, At the same time Plaintiff filed the above-captioned case, he filed a separate action against Midstate and Midstate's Chief Executive Officer, Michael Schatz a/kla Michael Brandon ("Schatz") which alleged breach of contract, promissory estoppel, unjust enrichment, and violation of Pennsylvania's Wage Payment and Collection Law, 43 P,S. 9 260,1m sea at Court of Common Pleas, Cumberland County, 97-5947 Civil Term, 12, On or about, March 5, 199B, Midstate and Schatz filed an answer and counter-sued Plaintiff for over $2 million dollars worth of damages, alleging, among other things, breach of fiduciary duty, conversion, and breach of contract. 13, AUached to Defendant's answer In the case at Court of Common Pleas, Cumberland County, 97.5947 Civil Term, as Exhibit "A", was an alleged Indemnification agreement which provided operating capital to Midstate, A true and correct copy of the alleged Indemnification agreement Is attached hereto, made a part hereof by reference, and marked as Exhibit "B", 14, The aforementioned indemnification agreement was not provided In the February 26, 199B record review, WHEREFORE, Plaintiff requests this Court to enter Preemptory Judgment against the Defendant, commanding Defendant to permit Plaintiff to examine the books and records of Midstate forthwith and to award Plaintiff his cost in this action, METTE, EVANS & WOODSIDE By: Date: 3.\1.Ll5" 3401 North Front Street P,O, Box 5950 Harrisburg, PA 17110,0950 (717) 232-5000 Attorneys for Plaintiff VERIFICATION I, Randal L. Fishel, hereby verify and state that the facts set forth in the foregoing document are true and correct to the best of my information, knowledge and belief. I understand that false statements herein are made subject to the penalties of 18 Pa. C.S.A. ~ 4904 relating to unsworn verification to authorities, r-)" C. ~\Jl Ra dal L. Fishel -1/ I . (\ . .~L..i\--L\) ,) ~1~ c.l:... \c ,\ <,5\ ~ DATE: DATED: (] " 114146_1 . 4 - G) " exhibit A €I) (0\ l' November I, 1996 Midatate Communications Corporation Attention: James Stroehecker, Sr., President 970 West Trindle Road Mechanicsburg, PA 17055 Gentlemen: I am a shareholder of Midatate Communications Corporation, Punuant to 15 Pa. C.S. 01508, I hereby demand and assert my right to inspect and copy, in person or by my attorney and/or accountant, the corporate books and records of Midstate Communications Corporation. Specifically, please pro~de access to the following documents: (a) Annual financial statements for 1990-1995; (b) Quarterly financial statements through the third quarter of 1996; (c) Cash receipts and disbursements journals for 1990 through the present; (d) General ledgers for 1990 through the present; (e) Form 1120S U.S. Income Tax Return for an S Corporation for 1994 and 1995; (f) Corporate minute book; (g) Stock certificate book; (h) Stock ledger book; (j) All documents relating to any indebtedness of Midatate Communications Corporation to any present or former (.-:- " " . ('I James Stroehecker, Sr., President November 1, 1995 Page 2 officer. director or shareholder of Midstate Communicatiuns Corporation, from 1990 through the present; (j) All documents relating to any indebtedness of any present or former officer, director or shareholder to Midstate Communications Corporation, from 1990 through the present; (k) All documents relating to the sale of assets of Midstate Communications Corporation to Whiteco Outdoor Advertising, including but not limited to documents reflecting distribution or disbursement of the proceeds of said asset sale; and (\) All documents relating to business connections or transactions of any kind between Midstate Communications Corporation and Quaker State Broadcasting Corporation, from 1990 to the present, including but not limited to (l) loans; (2) repayments of loans; (3) provision or exchange of corporate services, goods or other assets; (4) rentals or purchases of real or pereonal property, goods or services; and (5) cOntracts of any nature. This inspection is for a proper purpose in that I seek to understand the business operations and financial status of Midstate Communications Corporation as well as analyze and understand the nature and extent of my financial interest concerning Midstate Communications Corporation. This is a verified demand. All statements made herein are subject to the penalties of 18 Pa. C.S,A H904 (relating to unsworn falsification to authorities), ,Y~l~ .YJUrs/r,: / , /_c>-'~:/ ,/' ~ j;fj.*jl-----..~_c'~ /Randal L. Fishel 111110_1 Exhibit B . '''''''', .... . -, , (i) " CERTIFICATE OF SERVICE I certify that I am this day serving a copy of the foregoing document upon the person(s) and in the manner Indicated below, which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure, by forwarding a copy via U,S, first-class mail, postage pre-paid for service as follows: Edwin A,D, Schwartz Cunningham & Chernicolf, P,C, 2320 North Second Street P.O, bOl( 60457 Harrisburg, P A 17106-0457 METTE, EVANS & WOODSIDE By: t;i;... ,tJ!/ji,1.. jQ,,~ LJ--w- Daniel L. Sullivan, Esq, Sup, Cl. 1.0, No, 34548 Elizabeth Goldstein Dil(on, Esq. Sup, Cl. I.D, No. 73779 340 I N, Front Street P. 0, BOl( 5950 Harrisburg, PA 17110-0950 (717) 232-5000 Attorneys for Plaintiff DATE: 3-tl.QY / I ~ o. f':: c:;; /' ~n c;; ;~' ~:( c' ~~;.:, ...) .~ '('" ( ", " E-u <:... (~ :~j . , @f~ ClI :;.;V~ . ~ ~.f.. u: ~:-' ('!". I ~j;'fl ~, ."J .. F :I. :;-:.'- '1. 10 ,) U U' U \'j cJ ~ a: 1:: If .. B~i I~i ~ ..8~1! ~lll - S- o CJ ... za: .... ~fili zl:l~ z YO a ~ >- -.. c~ (',; ~' " , '; , c: , : " ,. e, I ., C1 In ; 1_;.. I il'ji L) ~ .' I '-~d .. -~ "-' \t. r- CJ '" 0 ... Co 0 " tl .. .. .. /1 0 " '0 = .. :> ::: ..-d .. .8 0 " .. 0 .. -.... .. 0 :g-a .. ~2 - - II :l ,g " ,- ~,~ . ~ .Q .. I - . ~ ' .. .. 0 .. .. .. ....g -.... ;;: 0 CUNNINGHAM & CHERNICOFF, P,C. ,~ , .:~ . o~ 1 RANDAL L. FISHEL, Plaintiff IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v, NO. 97 - ~946 CIVIL TERM MIDSTATE COMMUNICATIONS CORPORATION, Defendant civil Action - Law ANSWER TO COMPLAINT IN MANDAMUS AND NOW, comes Defendant, Midstate communications corporation, (hereinafter referred to as "Defendant"), by and through its counsel, cunningham & Chernicoff, P.C., and files its Answer to the Complaint in Mandamus filed by Plaintiff, Randal Fishel, and in support thereof, avers as follows: 1. Admitted. 2. Admitted 3. Admitted, By way of further answer, Plaintiff was also the General Manager of the Defendant corporation and as such, had control over the daily operations and financial affairs of the corporation, 4, Admitted, 5, Admitted. However, by way of further answer, through no fault of Defendant or its counsel, such time was never established. ~ 6. Admitted. 7, Admitted, 8, Admi tted, 9. Admi tted. See response to Paragraph 5 above. Further, Defendant's counsel was anticipating telephone communications as to establishing a time, but none resulted. 10. Denied as stated. Defendant's counsel has had numerous communications with Plaintiff's counsel regarding a mutually convenient time by which the Plaintiff, or his representative, would be permitted to inspect the Defendant's corporate books and records at the office of Defendant's counsel. 11. Denied as stated, Plaintiff has been requested to provide Defendant's counsel with available times for review of the corporate books and records, however, to date Plaintiff's counsel has failed to provide Defendant's counsel with any mutually convenient and acceptable times for such review, 12. The averment contained in Paragraph 12 of Plaintiff's Complaint represent conclusions of law to which no response is required. If it is later judicially determined that a response is so required, the averment contained in Paragraph 12 of Plaintiff's Complaint is denied, WHEREFORE, Defendant, Midstate Communications corporation, respectfully request that judgment be entered in its favor and against Plaintiff, and that this Honorable Court dismiss the Plaintiff's Complaint with prejudice and further award Defendant all such other relief as is proper and just. Respectfully submitted, CUNNINGHAM & CHERNICOFF, P,C, Date: /J,,u: ~ /.?.9? By: ~ Edwin A.D, Schwart re I,D, #75902 2320 North Second Street P. 0, Box 60457 Harrisburg, PA 17106-0457 Telephone: (717) 238-6570 (Attorneys for Defendants) mlm\doc.\.n.wer.~ldat.te VERIPICATION :I, Hic:h..l Sc::hatz, vic8-PlI:..iden1:, IUIS.tate COIIIII\.m1c::at1ona corporation, verify that the stat_ent. made in the toregoing An.wer to Complaint in Man,1aJGWl are 1;.rull and correct 1;.0 the best of lilY Xnovlec:lge, intormzltion and beliet, I underatand that talse atateaants herein Rr. made 8ubjec::t to the penalties ot unsworn falsification to a ellt oration Oats 1 I ~(jq1 ( II ii II :1 I ! .... CERTIFICATE OF SERVICE I, Edwin A.D, Schwartz, Esquire, do hereby certify that a true and correct copy of the Answer to Plaintiff's complaint in tlandamus in the above-captioned matter was placed in the united states Mail, certified Delivery, postage pre-paid in Harrisburg, pennsylvania on December ~, 1997, on the following: Daniel L. Sullivan, Esquire Elizabeth Goldstein Dixon, Esquire Mette, Evans & Woodside 3401 North Front street P.O, Box 5950 Harrisburg, PA 17110-0950 (Attorneys for Plaintiff) Date:~..o<: ;t ./~9? . By: Respectfully submitted, CUNNINGHAM & CHERNICOFF, P.C, ;~L~qUir. 1. D, *75902 2320 North Second street p, O. Box 60457 Harrisburg, PA 17106-0457 Telephone: (717) 238-6570 (Attorneys for Defendants) . ~ , I _' in ,,, { .~ i'l ':,' i ~ , I , ~ --'I' ---.-----_# ! ,ju-".j .' 1 ,-, ~'" ";I'; " . -.' +.':: i ;llt , .. ~ .l 1l1L)~/' 1 i i r~____'_~~h.;U_.l~~~, ....1:.-4 ~ .._; ",".',' ~..,' .',' T ,- 1 \ l' . .c./\....."),~;..'!_:.. 'i' ,. .' _ _.. ~ n_~~~"4.;:..!:.-.]~..__~--'L__. .L,_' ;--i :l)!) H':';;j;': "(I ~_,~~-,.b. -.Ii _;_':.. .~-_._~,:L_~___._~.._.._.______' " " -~,l"." ~U\l" tL~.L [....Li__ :-________ l_ ... _. 'Hh ~:' "" - \_\!'It: Eh~. t\~l f. ,____.t ~ '; -I j, 1 J, t;.' ! /i ':'i~ l~J!~ ; 1~~>~ :;L-..::.":" j' t'_.:. ,H>~:'~iJ t L.:! .~ ,~11' - " I " - . . ',' . ,." __=--~~--'----_ ...:.~.:. 4_ <-I) ;. EJ...':J~~~__ --,~--,-~----------' t i Ifj,~:, J ~ r ,'~,~ .. .i tl ,_, _"1,1 ';'_'ii r.],,_," ;. Ii t ;::.i ~. .. I. I' . ~ l ~ _ ' I . / ~ t. '}l,: :Jri l'~ ~,1 ~, (,"i,~) _.'~~_~__r~~ i.. : ;l' _ -. ..... -... - . u 1 }~'. . ,,' :':'!j:-~nLTrL , ..\,t,fi .; '/ ,,' / //. /' ,h'~ ~ ~P~#!'r.~# ,{7.....m .C''--' 1- ,.i ".' -,-_t; a- .10 -. 9 ) (}, a......, ,', ~~ .~.~.,#,.. , Randal L. Fishel PlaintH f Court of Common Pleas Cumberlanrl County, Pennsylvania v. Civil Action ' Law No, 9'7-$9'9~ C'-I.J\'( ~t2-,n..l Midstate Communications Corporation De f endan t NOTICE YOU HAVE BEEN SUED IN COURT. If you wish to defend against the claims seL forth in the following pages, you must take action within twenty (20) days aftsr this Complaint and Notice are served, by entering a written appearance personally or by attorney and filing in writing with the Court your defenses or objections to the claims set forth against you. You are warned that if you fail to do so the case may proceed without you and a judqment may be entered againat you by the Court without further notice for any money claimed in the Complaint or for any other claim or relief requested by the Plaint~ffls). You may loae money or property or other rights important to you. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. Court Administrator 4th Floor Cumberland County Courthouse 1 Courthouse Square Carlisle. PA 17013 (717) 240,6200 I' NOT I C I A LE HAN DEMANDADO A USTED EN LA CORTE. Si usted quiere defenderse de estas demandas expuestaa en las paginas siguientes, usted tiene viente (20) dias de plazo al partir de la fecha de la demanda y la notificacion, Usted debe presenta~ una apariencia escrita 0 en persona 0 por abogado y archivar en la corte en forma escrita sus defensas 0 sus objeciones alas demandas en contra de su peraona. Sea avisado que si usted no se defiende. la corte tomara medidaa y puede entrar una orden contra usted sin previo aviso 0 notificacion y por c~alquier queja 0 alivio que es pedido en la peticion de demanda. Usted puede perder dinero 0 sus propiedades 0 otros derechos importantes para usted. LLEVE ESTA DEMANDA A UN ABODACO INMEDIATAMENTA. SI NO TIENE ABOGADO 0 SI NO TIENE EL DINERO SUFICIENTE DE PAGAR TAL StRVICIO. VAYA EN PERSONA 0 LLAME POR TELEFONO A LA OFICINA CUYA DIRECCION SE ENCUENTRA ESCRITA ABAJO PARA AVERIGUAR DONOE SE PUEDE CONSEGUIR ASISTENCIA LEGAL, Court AdMinistrator 4th Floor Cumberland County Courthouse 1 Courthouae Square Carlisle, PA 17013 (717) 240,6200 Randal L, Fishel Plaintiff : Court of Commc..n Pleas ; Cumberland County, Pennsylvania v, : Civil Action. Law : No, 97- S9~~ e~(( ~J>I Midstate Communications Corporation Defendant COMPLAINT IN MANDAMUS AND NOW, comes the Plaintiff, Randal L. Fishel, by and through his attomeys, METTE, EVANS & WOODSIDE, P,C" and files this Complaint and avers as follows: 1. Piaintiff Randal L. Fishel is an adult individual who resides at 7850 Avondale Terrace, Harrisburg, Pennsylvania, 17112, 2, Defendant Midstate Communications Corporation (herein"Midstate") is a Pennsylvania corporation with its principal place of business at 970 West Trindle Road, Mechanicsburg, Cumberland County, Pennsylvania, 3, At all times relevant hereto, Plaintiff has been a shareholder of Midstate Communications Corporation, 4, On or about November 1,1996, Plaintiff requested that the Defendant corporation permit him to inspect, either personally or through his duly authorized representatives, the books and records of ~he corporation, A copy of his request, which was made pursuant to the Pennsylvania Business Corporation Law, as amended, 15 P,S, 9 130B,Is attached hereto as Exhibit "A." 5. On December 27, 1996, Defendant. through Its counsel, agreed to set up a time to allow Plaintiff to Inspect the corporate records and documents, 6, On January 27,1997, Plaintiff's counsel sought io reach an agreeable date for the inspection, A copy or Plaintiff counsel's January 27, 1997 confirmatory letter is attached hereto, made part hereof by reference, and marked as Exhibit "B", 7, In early February of 1997, the parties' counsel again spoke by telephone and Defendant's counsel promised to allow Plaintiff to examine the corporate books and records, Plaintiff's counsel sent a letter confirming this telephone conversation, This letter is attached hereto, made a part hereof by reference, and marked as Exhibit "C", B, On March 7.1997, Derendant, through its counsel, again promised to respond to Plaintiff's record requests, The March 7, 1997 letter is attached hereto, made a part hereof by reference, and marked as Exhibit "0", 9, After no further response from Oerendant's counsel, Plaintiff demanded that he be given access to the corporate books and records no later than March 21, 1997, A copy of this written demand is attached hereto, made a part hereof by reference, and marked as Exhibit "E", 10, Defendant has failed to respond to Plaintiff's March 21,1997 written demand, 11, Plaintiff has never been given the opportunity to Inspect Midstate's books and records, 12, Plaintiff Is without another adequate and specific remedy at law, WHEREFORE, Plaintiff requests this Court to enter judgment against the DefendDnt, commanding Defendant to permit Plaintiff to examine the books and records or Mldstate and to award Plaintiff his costs in this action, METTE, EVANS & WOODSIDE By: E~~~OL1{~O~'~RE Supreme Court 1.0, #73779 3401 North Front Street P,O, Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 Attorneys for Plaintiff DATED: 'ol~1-I'l1- /1 1,1\... ,......,n ',,\ Exhibit A M IllTT Ill, IllVANS a WOODSIDIll " PllorUHIO!'f4L CORruUATION ATTONNEYH AT LAW HOWtu. c. MlrT'l JAWIJ .. IV"I'd ao...... r WOOIU CHAAU,J I ZWAU.T Pin. J Al.Ul.U u.ol'D a 'lA1UJrri CAA1C A STONI JAJoIU ^ UUH DAHIll. L. SUWVAN 3<601 NORTH rRoNT STRUT P.O. BOX 81850 HA..HJUtiBCRU. PA 17110-0850 DAHlI1. ... CAWraw. ANlltoHY r LUCIDO rOOD ^ fUL1.,p WlAUTH oJ COl,DJTllN TELEPHONE 11171 1131,1.5000 CollY , UN1V1WTANO WICHA!i. D riM THOMAS' WIDA 1e""'N N CONNILLY '-OITN J IAUWAN JAYSON.. WOUCAJolG IWILY LONG HO"MA'" wATntl'. A COUNlA aArMlUN DOYU TANrNlJI. UTnl.lD IOIU.TIWooo.>>DI STlvtN D INTDI.. OiWTOP'HU. C. CONNIA U,'UI I aoc.w AHOUW K OOWUNC "'ICHAlL D U10 aolU. T , HA'f'NU m MULA J LlICHT c....AY J HlI.. DAVID ^ "rz1lMONS "AX NovIM1~i~~, 1996 Midstate Communications Corporation Attn: James Stroehecker, Sr" President 970 West Trindle Road Mechanicsburg, PA 17055 CERTIFIED MAIL RETURN RECEIPT REQUESTED RE: RANDAL 1.. FISHEL Gentlemen: This office represents Randal L. Fishel, an ex-employee of Midstate Communications Corporation ("Midstate"). During his employment with Midstate, Mr. Fishel was often required to defer cashing his paychecks because of Midstate's poor cash flow and the insufficient account balances of Midstate's payroll accounts. Mr, Fishel's temporary deferral of wages due and owing to him was done with the knowledge and consent of Midstate's management and principals, Mr, Fishel deferred negotiation of paychecks as far back as November 30, 1993 and continuing at various times throughout 1994 and 1995, The total amount of wages not paid to Mr. Fishel because the checks were not negotiated is $57,500. Photocopies of these paychecks are enclosed for your reference and for reconciliation with your records, Mr. Fishel has the original checks and will return them to Midstate as part of a full resolution of wage claims, A13 you know, Mr, Fishel also agreed to a deferred salary arrangement whereby his annual salary was adjusted from the agreed-upon amount of $60,000.00 to $50,000.00 for the years 1994, 1995 and part of 1996, The deferred salary now due and owing to him for this time period is $27,500,00, Mr, Fishel is also entitled to compensation for his thirteen (13) weeks of accrued vacation time at the time his employment terminated, At his annual salary of $60,000.00, the value of Mr. Fishel's accrued vacation time is $15,000.00. Pursuant to the "Agreement to Extend Loans to Corporation" dated February 16, 1990, Mr. Fishel was entitled to additional wages of $50,000.00 as of i Corn~;I~ :lIm. 1 IndiOt :: lot &dd,l.gr'lll ''''''11:'' NOV 2 S 1 I ComO'ele 'I.m. J, and ... , b . Ptlnt '1'01.1' name .nd 'ddt... on 1"1 rIYI'" 01 ft". 101m '0 f~1 WI cin ,.curn Ii'll, cara 10 YOY ! . Anac;h Ihtl 101m to tl'l4lltonl or 11'1. m..lp.lC.. or on en. b.lcl( " 101C' doe. nol Q4!,mll. .J . Wnll' 'R.tum A,celpt Aequ..tld" on ttle m~IP+'tCI below tne Irtlcl. numlHl, . The A.f\jtn AI"'OI .....Illhow to ""horn l~ "'te'e ,u. ".klt.red .nd Ih. dlle i d.h....'.d J 3. Articl. Add'....d 10: t i I .1.0 wi.h 10 rlc.i.."., Ih. fol/owlng ..,vice. (tot .n .d,. f..l;' 1. 0 Add'....... Addl... ~ j J. j ; -j 1" IS . g .. nlv if roqu..tod ! 4.. 2. 0 Rlltrlcl.d C.Uvery Conault o.tmaar.r 'Ot f,.. Arllele Num~r Midstate Communications Cor Attn: James Stroehecker, Sr 970 West Trind1e Road Mechanicsburg, PA 17055 4b. S.,..,,/ce Typ, o R'gier'rld iQ Ctrti fltd o Expr.., MliI 7. Olr. 0' C v o InlUrld Dcoo AI rn Rlclipl tor 8416,1 5, DOMESTIC RETUHN RECEIPT 8. , December 1991 au... GPO: 111G-3Q.114 ~. 187 529 859 ~ Receipt for Certified Mail No lrsuranca Coverage Provided ~ 00 not use for International Mail lSee R,vlnel Ii! - I g- el) .., ~ en c>. r ~"","l" PA $x X 5 ',""..,,;-... ';;;"',., > .~', ..~ ".W"-'" I :~ ..... ."'.. "'~"".. "~'_.~' ,.," l , .......,:..- lo ~ .." ~..' .~'": ""i..I" ..... '..~ ~ j ; .... ,;."" fr. 1 ~; ~'.' ".. ; ".1.1'~:' X $ 'l;r~L ...,>, ;;.. -\ ....~ "':stm,I" :' ;'I"~ 11/20/96 I , -~-- ---~------ exhibit B >fETTN, EVANS.. WOODSIDIIl A PIolOFIUUnONAL. COMJ>1,IRAl'loN ATTOR~:EY!j AT LA.W HOWW. C ..um JN41.. ....."/loll ..OIU. r ..00'.1 CMAAu.s . ZWAU. '( ,.rIA J a.JJ,SUA UOYD.. PU.JlJ)ol '.."'e.... no,.,;, JAMU A UUH DA""lL L. lUWVA"" STIVIN 0. }NYDlA QtlWfO'HIJ. C. CONNQ IJ"n.l Jt.OCUJ ....l'IDlUlI' H. OOWUNC MlCKAlL I) U1D 1l01Ur, HAYWU III MUl.A J UICHT GAA'I'J HlJlI4 DAVID A ftTnUoIONS 3<Wl NORTH FRONT STRUT P.O. BOX 5U40 HARR18Sc.:RG. PA. l1U.o.OV30 TELltPIIONt: 11171 ;13&1-&000 ~l.lY , UN!V1NTANO MICHA1L D PI'A THOMAJ , lMJOA /tAUN H CONHIl.L'I' ~UN J IATZMAN J....T~N .. trOUCAJt4G IMIL Y LONG HO"WAN WA rTHlw ^ COSlNZ.", l,UHUIN DO"l'U 'tANIWIl UTllU1) aoau.r 1 WOODSlDl DANIlL .. CAMnlw.. ANTHONY r LUCiDo TODD A ruWA W.lAUTH J COLDJTIf)I ....x 171'1lll3e-lalO January 27, 1997 Robert E. Chernicoff, Esquire CUNNINGHAM & CHERNICOFF 2320 North Second Street P.O, Box 60457 Harrisburg, PA 17106-0457 RE: RANDAL FISHEL: MIDST ATE COMMUNICATIONS CORP, Dear Bob: Please find enclosed a copy of the records request sent by Randy Fishel to Midstate Communications Corporation on November 1, 1996, These are the records we wish to inspect and, potentially, copy, Please let me know when these documents can be made available for inspection, You and I apparently have received very different information concerning .control" of Midstate Communica,tions Corporation, I will have to review this issue further. I look forward to hearing from you on our records inspection, Very truly yours, DLS:sks Enclosure METTE, EVANS & WOODSIDE ~"~-' ! '-:~'\_-'-- Daniel L. Sullivan Exhibit C f~" "..,' " '.\' o HI\'TTIIl. IIlVANfj .. WOODfjlDIIl .to paorpaJOH41. CORrOIlATION' ATTOa....Cy. AT L.AW HO.ILL c:. WlTTI JAWIJ .. ,"A},IS IlOIU.T WOOIJ. CHAA,W I Z'lt'AU. T "fla, J UlJUll U.OYl) A. PU.JUt" CMlG It.. STONl JAMU A. UUH DANW. L SUWVAJrrI snVIH D SJO'DU. CHI.UTOI'HP C. CONNIA II. YSll aOGllU "HCU'" K DOW1..IHc WlCKAII. . WI> a.oau. T , HA 1')IU III 'AULA J. WCHT c.AllTJ. twW DAVID A. PlTUlMONS 3401 NORTH nON" MTR&XT PO. BOX DINlO HA.JlIU8Buau. .A l1Uo-oeDO I4ICHA1L D rI,... TOOD A IIUWA GUY , 1IN1V1WTAJoIO WZAMTH J GQl..DjTllN fJiOWAJ' t.WIOA IAAU.JY A. .,~U AQ'Y'W ""TIMAN IQWWAN JIPn.IY T aw.w.L JAY)ON a. Wot.rGANG D4lLY I.ONG HOrfMA)lI MTHWW DOnI "''''''IJolU OAWlIl. ... c.AWW.L IlITlUD Arn'HONY T LUCIDO J.OIU.t' I WOOO$lDl T'&LZPBO"'& '7171I3>>-aooo r...: 17171:130.111. ..JlnpJ_"",nl~ 1"eDruary l~, 1997 Robert E. ChernicotT, Esquire CUNNINGHAM & CHERNICOFF 2320 North Second Street P.O. Box 60457 Harrisburg, PA 17106-0457 RE: RANDAL FISHEL: MIDST ATE COMMUNICATIONS CORP. Dear Bob: Confirming our telephone call from last week, I would appreciate hearing from you as soon as possible when the Midstate corporate records can be examined, Thank you. Very truly yours, METrE, EVANS & WOODSIDE 0.-.._i r:-S'-A-' , '- - Daniel L. Sullivan DLS:sks Enclosure cc: Randal L. Fishel 92772 I " r ExhltMt 0 JORDAN D Cl:NNINGHAM ROBERT E CHERNlCOFF DEBORAH l. PACKER PAIGE MACDONALD.MATIHES MARC W. WrrZlG EDWIN A.D. SCHWARTZ CUNNINGHAM & CHERNICOFF, P.c. ATTORNEYS AT lAW 2320 NORTH SECOND STREET P.O. BOX 6lJ.137 HARRISBURG, PENNSYlVANIA 17106-lJ.I37 IRS NO. n-Wi135 FAX (711) ~ HE RSHEY TUEPHOlliE (717) 5U-2Il33 TELEPHONE (7\7) 238-6570 March 7, 1997 Daniel L. Sullivan, Esquire METTE, EVANS , WOODSIDE 3401 North Front Street P. O. Box 5950 Harrisburg, PA 17110-0950 RE: Mid-State Communioations COrD., Randal L. pi.hel [)Iaar Dan: As I previously informed you, I forwarded your request to my client. I am out of the office during the week of March 10, 1997. My client has attempted to contact me, however, we have missed each other and I would expect to have this matter resolved as to your document request shortly after I return to the office. Sincerely yours, CUNNINGHAM' CHERNICOFF, P.C. d Robert E. sjo cc: Michael Brandon, Vice President r -. ro .... f.\I',""'I-' fLNMI "{~.!.f~l ,., Exhibit E r; .tIJ!lTTJ!l. J!lVAX. oil WOOD.IUIll .. PIIOruaJoNA1. COapOIIATION ATTOIL"'UtYli AT LAW HO"IU. C. WlTTl JNI4U ... IVMn ..our.T WOO... QtAa,w I IWAU.1' ,.na J. UUUA lr.LO'fD"~ CANGA JTOtol. JAW&S A IJUH DAJoIw. l. WlUVAN :J.4C)1 NORTH rNONT MTR&.&l" P.O. BOX 8li&O H.A.IUU8SCRG. PA 17J,1().0815oO MKKA&1. D PI'.... rODD ^ l'(Ju.P COY, UN'''INTANO Wl"UTH J GoOUl.ITlI)ol fHOWAJ . U6lDA ....AQUy A . A1.UA ac.."... &ATZMAN 1OYMt\'" JVn.1'f T J.il'-II.LL .lAT300N A "~^wG UOUU' LONG HOf'MAN lATMLJIN DOTLI YANI)4l DANW. .. CAwnw. U flUO ANTHONY r l.UCIDO &CUlT I- wOOQi&DI JTlVlN 0 s,..-rou CH~roPHU Co. CONNU. IL.YUl aoc;.UJ. ....NDU.. H. DOWlfkG IollCl1AII. " ..... ..o....r' ttA'OollS W 'AULA J. I.IIC.HT c.u. Y J Hl1M DAV1D A AT lllWONS TSL&PlloNa 171" .3..&000 'AX 1717) lI38-1I18 ~tcli '"t,i'997 Robert E. Chernicoff, Esquire CUNNINGHAM & CHERNICOFF 2320 North Second Street P.O. Box 60457 Harrisburg, PA 17106-0457 RE: RANDAL "ISHEL: MIDSTATE COMMUNICATIONS CORP. Dear Bob: I acknowledge receipt of your letter dated March 11, 1997. Mr. Fishel first demanded these records directly from Midstate on November I, 1996. There was no response. My follow-up letter to you requesting these same records was dated January 27, 1997. Frankly, there is no excuse for such extraordinary dalay. This delay is further evidence of Midstate's disregard and oppression of Mr. Fishel in his status as a minority shareholder. . I understand that you will be back in the office on March 17. Please make the documents available for inspection no later than March 21, :1.997. If not, there is no alternative but litigation. Very truly yours, METrE, EVANS & WOODSIDE I ..._~ ~ _~. \ _, -------- Daniel L. Sullivan DLS:sks cc: Randal L. Fishel 94888 1 CERTIFICATE OF SERVICE I certify that I am this day serving a copy of the foregoing document upon the person(s) and In the manner Indicated below. which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure, by forwarding a copy to the Cumberland County Sheriff for service as follows: Midstate Communications Corporation 970 West Tondle Road Mechanlcsburg. PA 17055 METTE, EVANS & WOODSIDE By: Dff1!~~ ~~~ Sup. Ct. 1.0. No. 34548 Elizabeth Goldstein Dixon, Esq. Sup. Ct. 1.0. No. 73779 3401 N. Front Street P. O. Box 5950 Harrisburg, PA 17110-0950 (717) 232-5000 Attorneys for Plaintiff DATE: 1(j1~1-\'t1 (3) -+>-- ~ ~--.J l/l o;J a A: ''''? 0 o t... ~ vi ~ r-I/~ r\ t1 .... ...... ~ \:l. ~ ~ ~ ~ d r/.. (\ ';; We;,;u:.... 11'1 ssno .LSHI:I ... I ~ U t- en II: - ... ildH U a: If ~ o 1~ l!aJ'" w_j i I I a . . GlU N . -.illo ... &.... : Ul... GI 0 "''''GI I O~ lei ...u.,.,. 0 \ N.... U1 .... ',.\ i~~ ~ fiu~:;:;~ 0..111... o . ~~t\Of .cblOlf czal jjE~~ RANDAL L. FISHEL, Plaintiff, : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, PENNSYLVANIA v. : No. 97-5946 CIVIL MIDST ATE COMMUNICATIONS CORPORATION, Defendant, : CIVIL ACTION - LAW : JURY TRIAL DEMANDED IN RE: PLAINTIfF'S MOTION FOR PREEMPTORY JUDGMENT BEFORE BAYLEY. In GUIDO. J, ORDER OF COURT AND NOW, this ~1~day of JUL Y, 1998, after argument, Ihe Plaintifrs Motion for Preemptory Judgment is GRANTED. Defendant shall make available to Plaintiff, his agent or attorney, the share register, books and records of account, and records oflhe proceedings of the incorporators, shareholders and directors, The tenn "books and records of account" shall include, but not be limited to. Ihe corporation's tax returns. Plaintiff, his Bgent or attorney, may examine such documents and/or make copies or el\lracts therefrom. Edward E, Guido, 1. Elizabeth G. Dixon, Esquire Attorney for Plaintiff , /. r?/ ;J..x /9 t . .. c.,A:>H~ ~'-"-"<\.. ./0> U "b ."" /";n:r ':.):"{'J; .:':",,:~'--~~ ':';I~ Edwin AD. Schwanz, Esquire Attorney for Defendant FlLfl).{HieE OF 11'~ --"[' 'r"M'F'l'f . . ~ I" '~~', .'" ~'. , . " ., . . . . 98 JUl 21 Ptl 2: ?7 "'''Jar-c, {,',' ,','''.'lY \,.t\.iltl ,:n..- I _ .......\;14. l'lCEN".r)vl If' '.1,\ r~ 11' 1,-,,"""''; d .. In order to be entitled to relief under Section 1508 of the Business Corporation Law, the No 97-5946 CIVIL judgment as a matter of law Washowich v McKeesport Mun. Water Auth. 94 Pa.Commw, 509, 512-513,503 A,2d 1084,1086 (1986), We believe the Plaintiff has met that standard in the instant case, Plaintiff must establish the followinll: (I) He is a shareholder, (2) He has complied with the provisions of Section 1508 with regud to the fonn and manner of making demand for inspection. (3) He steks the inspection for a proper purpose. The Defendant concedes that Plaintiff is a shareholder.l Defendant further admits that it received a verified letter from Plaintiff requesting an inspection of all books and records of the Corporation,l The verified letter sets forth Plaintiff' 5 stated purpose "to understand the business operations and financial status of Midstate Communications Corporation KS well as analyze and understand the nature and extent of my financial interest concerning [the corporation].'" The Defendant's only objection to Plaintiff's motion for Preemptory Judgment is that Plaintiff's request is not for a proper purpose,' It argues that since Plaintiff has been the general manager of Defendant he should be well aware of the business operations of the COrpollltiOD. However, Defendant does not address Plaintiff' 5 stated purpose of understanding the financial lAnswer~ 3. lReply to PI. '5 Mot. for Preemptory 1. ~ 4. 'PI.'s Mot. for Preemptory 1. Ex. A. 'Reply to PI. 's Mot. for Preemptory J.' 5. 2 No 97-5946 CIVIL status of the corporation as well as the value of his financial interest therein. These are both proper purposes. Friedman v. Altoona Pipe and Steel Supply Co, 460 F.2d 1212 (3rd Cir. 1972), Therefore, we believe that Plaintiff is entitled to the relief requested. At oral argument, the parties raised an ancillary matter which we will address now in the interest of judicial economy. The P!aintiffhas requested Midstate's income tax returns, but the Defendant claims they do not fall under the category of "books and records." We believe that they do, The tax returns may shed light on the actual value of Midslate and could help make clear to the Plaintiff' the exact nature and value of his illlerest. B&iJ.lv v. Coppenech Inc., 19 D. & C. 3d 349,35 I (C.P. Lehigh 1981). Therefore, Midslate must make the requested income tax returns available to the Plaintiff The Defendant argues that the Plainliff had an obligation to pay for part of the preparation fees for the tax returns, It fun her argues that since Plaintiff has not satisfied this obligation, he should not be allowed access to the tax returns. The Defendant does not cite any authority to suppon its position, Section 1508 outlines the requirements a shareholder must satisIY in order to inspect the books and records of the corporation. These requirements do not include the satisfaction of any alleged debts owing to the corporation, Any claim Defendant might have against Plaintiff' for failing to pay a ponion of the tax preparation charges is not properly before us. ORDER AND NOW, this~ay of JUL Y, 1998, after argument, the Plaintiff's Motion for Preemptory Judgment is GRANTED. Defendant ShBII mBke available to Plaintift; his agent or 3 No, 97-5946 CIVIL attorney, the share register, books ilI.d records of account, and records of the proceedings of the incorporators, shareholders and directors, The lerm "books and records of account" shaII include, but not be limited to, the corporation's tax returns, Plaintiff, his agent or attorney, may examine such documents and/or make copies or extracts lherefrom. By the Court, 151 Edward E Guido. 1. Edward E. Guido, J. Elizabeth G. Dixon, Esquire Attorney for Plaintiff Edwin AD. Schwartz. Esquire Attorney for Defendant ,> 4