WRIGHT v. LORUSSO, 2023 NCBC 34

STATE OF NORTH CAROLINA
MECKLENBURG COUNTY
IN THE GENERAL COURT OF JUSTICE
SUPERIOR COURT DIVISION
20 CVS 10612
NANCY WRIGHT; GREG WRIGHT;
and JODY STANSELL, individually
and as members of LORUSSO
VENTURES, LLC d/b/a
CINCH.SKIRT,
Plaintiffs,
v.
KRISTA LORUSSO, individually and
as a member-manager of LORUSSO
VENTURES, LLC d/b/a
CINCH.SKIRT,
Defendant,
v.
LORUSSO VENTURES, LLC d/b/a
CINCH.SKIRT,
Nominal
Defendant.
ORDER AND OPINION ON
PLAINTIFFS’ MOTION FOR
PARTIAL SUMMARY JUDGMENT
Law Office of Matthew I. Van Horn, PLLC, by Matthew I. Van Horn, for
Plaintiffs Nancy Wright, Greg Wright, and Jody Stansell.
Leonard G. Kornberg, P.A., by Leonard G. Kornberg, for Defendant
Krista LoRusso.
Higgins & Owens, PLLC, by Sara W. Higgins, for Nominal Defendant
LoRusso Ventures, LLC.
Conrad, Judge.
1. 	This case arises from a dispute among the members of a company called
Cinch.Skirt. 	Plaintiffs 	Nancy 	Wright, 	Greg 	Wright, 	and 	Jody 	Stansell 	are
Cinch.Skirt’s minority members. They accuse Defendant Krista LoRusso of abusing
her position as the majority member and have asserted more than a dozen direct and
Wright v. LoRusso, 2023 NCBC 34.

derivative claims against her. Before the end of discovery, the Wrights and Stansell
moved for partial summary judgment on their eleventh claim, which is a direct claim
for declaratory judgment. (See Pls.’ Mot. Partial Summ. J., ECF No. 149; see also 2d
Am. Compl. ¶¶ 202–05, ECF No. 65.) In its discretion, the Court elects to decide the
motion on the briefs and without a hearing. See BCR 7.4.
2. 	In short, the Wrights and Stansell argue that LoRusso has improperly
distributed Cinch.Skirt’s cash to herself while withholding distributions from them.
This 	misconduct, 	they 	contend, 	triggered a 	buy-sell 	event under Cinch.Skirt’s
operating agreement, either because it is a breach of the agreement or because it is
an act of fraud, theft, or embezzlement against the company. 	Determining that a
buy-sell event occurred would have far-reaching consequences, potentially requiring
LoRusso to withdraw as a member of Cinch.Skirt and to sell her membership interest
back to the company. In support, the Wrights and Stansell have tendered affidavits
from themselves, along with an unsworn letter from their expert, R. Wayne Hutchins.
(See Pls.’ Exs. A–D, ECF No. 151.)
3. 	Right from the start, this motion faces serious headwinds. 	Courts rarely
enter summary judgment before the end of discovery. A basic premise of modern civil
litigation is that all parties deserve a full and fair opportunity to pursue discovery
that is germane to the dispute. A motion for summary judgment is premature “when
discovery procedures, which might lead to the production of evidence relevant to the
motion, are still pending and the party seeking discovery has not been dilatory in
doing so.” 	Conover v. Newton, 297 N.C. 506, 512 (1979); see also Watson v. Watson,

2023 N.C. App. LEXIS 158, at *8–9 (N.C. Ct. App. Apr. 4, 2023) (vacating order that
granted motion for summary judgment filed before close of discovery).
4. 	Likewise, courts rarely “enter summary judgment in favor of the party
having the burden of proof.” Blackwell v. Massey, 69 N.C. App. 240, 243 (1984). This
is 	especially 	true 	when 	the 	party’s 	credibility 	is 	at 	issue 	because 	credibility
determinations are for a jury, not for the Court. 	Thus, entry of summary judgment
“for a party with the burden of proof” based on “his own affidavits” is permitted “when
there are only latent doubts as to the affiant’s credibility,” when the nonmoving party
has not offered any materials in opposition, and “when summary judgment is
otherwise appropriate.” Kidd v. Early, 289 N.C. 343, 370 (1976). The moving party
must satisfy not only the usual burden to show “that there are no genuine issues of
fact” but also “that there are no gaps in his proof; that no inferences inconsistent with
his recovery arise from the evidence; and that there is no standard that must be
applied to the facts by the jury.” Id. Even then, the trial court has discretion to deny
the 	motion 	“if 	the 	affidavits 	seem 	inherently 	incredible” 	or 	“if 	the 	need 	for
cross-examination appears.” Id.
5. 	These standards impose a heavy burden—one that the Wrights and Stansell
wholly ignore. 	They say nothing about the differences between offensive and
defensive motions for summary judgment. And they simply have not put forward the
kind of airtight case that could support entry of summary judgment in these
circumstances.

6. 	To start, their featured evidence—Hutchins’s expert opinion that LoRusso
received over $100,000 in excess distributions—isn’t even admissible. 	Hutchins
expressed his opinion in the form of a two-page letter, not an affidavit. The letter is
unsworn, inadmissible, and cannot be considered for summary judgment. See Rankin
v. Food Lion, 210 N.C. App. 213, 218 (2011); see also Carter v. Clement Walker PLLC,
2014 NCBC LEXIS 1, at *16–17 (N.C. Super. Ct. Jan. 10, 2014) (“All testimony,
including 	opinion 	testimony, 	must 	be 	made 	under 	oath 	or 	affirmation 	to 	be
admissible.”).
7. 	The affidavit testimony of the Wrights and Stansell, while admissible for
Rule 56 purposes, is hardly compelling. 	They say that LoRusso has taken cash
“distributions” but concede that they do not know “the amounts or dates” of those
distributions—highlighting the gaps in their proof. (Pls.’ Ex. A ¶ 13; Pls.’ Ex. B ¶ 12;
Pls.’ Ex. C ¶ 12.) 	Moreover, it is impossible to overlook the credibility issues that
naturally arise from testimony given by interested parties who stand to gain from
LoRusso’s expulsion from Cinch.Skirt. Cross-examination will be essential here. And
in any event, the facts are disputed. In opposing the motion, LoRusso offers her own
affidavit 	to 	show 	that 	she 	has 	received 	only 	legitimate 	compensation 	and
reimbursements from the company, which the Wrights and Stansell knew about and
approved. (See generally LoRusso Aff., ECF No. 169.)
8. 	These are not the motion’s only shortcomings. 	As a final example, the
Wrights and Stansell accuse LoRusso of fraud, theft, and embezzlement without

reciting the elements of those claims or making any effort to explain how LoRusso’s
actions measure up.
9. 	In an attempt to cure these defects, the Wrights and Stansell pad their reply
brief—which they called a “Supplemental Brief”—with new arguments and new
evidence learned during discovery conducted while the motion was pending. (See Pls.’
Suppl. Br., ECF No. 170.) 	These new matters, if anything, confirm that the motion
was premature. 	The Court declines to consider the reply brief and the untimely
arguments and evidence within it. See BCR 7.7 (“[T]he Court may decline to consider
issues or arguments raised by the moving party for the first time in a reply brief.”).
10. 	For all these reasons, the Court DENIES Plaintiffs’ motion for partial
summary judgment.
SO ORDERED, this the 4th day of May, 2023.
/s/ Adam M. Conrad
Adam M. Conrad
Special Superior Court Judge
for Complex Business Cases