Filed: 3/31/2015 12:10:46 PM
David R. Lloyd, District Clerk
Johnson County, Texas
By: Kristine Bock, Deputy
NO. DC-C201500023
THE WEEKEND CUTTER, LLC,
WORLD CUTTING HORSE
ASSOCIATION, LLC, KENNITH L.
EMIGH AND ANNA EMIGH
Plaintiffs,
v.
RAY WHITMIRE AND LAINIE
WHITMIRE
Defendants.
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IN THE DISTRICT COUJlT
413th JUDICIAL DISTRICT
OF JOHNSON COUNTY, TEXAS
COUNTER-PLAINTIFFS' APPLICATION
FOR TEMPORARY INJUNCTION
TO THE HONORABLE JUDGE OF SAID COURT:
NOW COMES Ray Whitmire and Lainie Whitmire, Defendants and Counter-
Plaintiffs, as well :;is Counter-Plaintiffs on behalf of The Weekend Cutter, LLC and World
Cutting Horse Association, LLC by a derivative lawsuit, and file this Counter-Plaintiffs'
Application for Temporary Injunction against Kennith Emigh and Anna Emigh, Plaintiffs,
and in support thereof, shows the Honorable Court the following:
FACTS
1.
Counter-Plaintiffs Ray Whitmire and Lainie Whitmire ("the Whitmires") and
Plaintiffs Kennith Emigh and Anna Emigh ("the Emighs") are 50%-50% owners of interest
in The Weekend Cutter, LLC and World Cutting Horse Association, LLC. The Whitmires
purchased 50% interest in The Weekend Cutter, LLC from the Emighs for $200,000.00 in
cash, with another $50,000.00 to be paid the Emighs from the Whitmire's share of profits
of World Cutting Horse Association, LLC, which the parties started together with each side
investing $50,000.00. The Whitmires have invested an additional $60,000.00 in World
Counter-Plaintiffs' Application for Temporary Injunction - Page 1 of 16
Cutting Horse Association, LLC because it did not have the money to pay its obligations
after its first major event.
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2.
The Emighs have intentionally and willfully misappropriated funds of The
Weekend Cutter, LLC and World Cutting Horse Association, LLC for personal expenses.
and personal benefit in an amountbelieved to exceed $58,000.00 as outlined below.
3.
The Emighs have received bartered product from advertisers with a value
exceeding $7,000.00 in exchange for advertising on The Weekend Cutter, LLC's television
show without compensating The Weekend Cutter, LLC.
4.
The Emighs have received horse training with a value of approximately
$37,000.00 fortheir personal horses from horse trainers featured on The Weekend Cutter,
LLC's television show without compensating The Weekend Cutter, LLC.
5.
The Emighs have engaged in wrongful conduct and defrauded The Weekend
Cutter, LLC by using company funds totaling at least $10,300.00 for personal expenses,
including, but not limited to, personal meals, fuel, a vet bill, personal credit card expenses,
cell phones, and vehicle and equipment repair without reimbursing the company.
6.
The Emighs have engaged in wrongful conduct and defrauded World Cutting
Horse Association, LLC by using company funds totaling at least $3,200.00 for personal
expenses, including, but not limited to, personal meals, fuel, and vehicle and equipment
repair without reimbursing the company, and have attempted to double charge the
company for personal expenses incurred and paid by World Cutting Horse Association,
LLC's funds by crediting their capital account for the use of the equipment the company
paid to repair or service. Additionally, the Emighs have also defrauded the company and
the Whitmires by crediting their capital account with an exorbitant charge for cattle hay.
Counter-Plaintiffs' Application for Temporary Injunction - Page 2of16
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7.
The Emighs have failed to advertise upcoming events on the World Cutting
Horse Association, LLC's website and have prevented the Whitmires from being able to
do so by claiming individual ownership of the web domain and instructing the website
manager not to place anything on the website without Kennith Emigh's permission.
8.
The Emighs have failed to attend and film some events sanctioned by the
World Cutting Horse Association, LLC for production on The Weekend Cutter, LLC's
television show even though representations were made to producers of and participants
in the World Cutting Horse Association, LLC's sanctioned events that the events would be
filmed to obtain footage to be aired on the television show.
9.
Kennith Emigh told Lainie Whitmire that he personally designed the image
of a globe used by World Cutting Horse Association, LLC on its website. World Cutting
Horse Association, LLC has now been threatened with a lawsuit for copyright infringement
for the use of the image of the globe.
10.
By the actions alleged above, the Emighs have breached the following
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fiduciary duties owed to The Weekend Cutter, LLC and World Cutting Horse Association,
LLC: the duty not to usurp company opportunities for personal gain; the duty of utmost
good faith; the duty of loyalty; the duty to refrain from self-dealing; the duty to act with
integrity of the strictest kind; and the duty of fair and honest dealing.
11.
The Whitmires seek to preserve the status quo in this matter until a final
trial on the merits of the Whitmires' claims. Unless the Emighs are temporarily restrained
during the pendency of this litigation, they will continue to mismanage the companies'
funds, and the relationship of World Cutting Horse Association, LLC with its membership
and affiliates will be damaged, and as more set forth below, will cause the Whitmires
Counter-Plaintiffs' Application for Temporary Injunction - Page 3of16
irreparable injury for which there is no adequate remedy at law.
ELEMENTS
12.
In light of the above described facts, the Whitmires, seek recovery from the
Emighs. The nature of the lawsuit is fraud, breach of fiduciary duty, and declaratory
,judgment.
13.
The Whitmires are likely to succeed on the merits of their lawsuit because
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the Emighs have admitted to personally receiving bartered product from The Weekend
Cutter, LLC's advertisers and horse training from featured horse trainers, as well as the
use of the companies' funds for personal use.
14.
Unless this Honorable Court temporarily restrains the Emighs until a final trial
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on the merits of the Whitmires' case, the Whitmires will suffer irreparable injury, for which
there is no adequate remedy at law to give the Whitmires complete, final and equal relief.
More specifically, the Whitmires will show the court the following:
A.
The harm to the Whitmires is imminent because the companies' funds
which are currently under the control of the Emighs are being misappropriated and
the value of the Whitmire's interests in the companies continues to be lessened by
the Emighs' actions.
B.
This imminent harm will cause the Whitmires irreparable injury in that
funds needed to keep the companies running will continue to be used personally by
the Emighs, the full value of advertising and the featuring of horse trainers on the
television show withheld from The. Weekend Cutter, LLC, and the public relations
with World Cutting Horse Association, LLC's membership and affiliates will continue
to be harmed by the Emighs' failure to advertise and film upcoming events.
Counter-Plaintiffs' Application for Temporary Injunction - Page 4of16
C.
There is no adequate remedy at law which will give the Whitmires
complete, final and equal relief because if the companies do not remain liquid
during the pendency of this lawsuit, or if World Cutting Horse Association, LLC's
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membership and affiliates become so dissatisfied with the company's lack of
interest in their shows that they lose interest in holding or participating in sanctioned
events, there will be nothing to gain in the end.
15.
Furthermore, the Whitmires should be granted a temporary injunction
because:
A.
The Whitmires are entitled to the relief demanded above, and all or
part of the relief requires the restraint of the acts described above which are
prejudicial to the Whitmires ..
B.
The above described acts of the Emighs relate to the subject of the
pending litigation, in complete violation of the rights of the Whitmires, and those
acts, if allowed to continue, would render a judgment in this litigation against the
Emighs ineffectual.
BOND
16.
The Whitmires are willing to post a reasonable temporary restraining order
bond and requests the court to set such bond.
REMEDY
17.
The Whitmires have met their burden by establishing each element which
must be present before injunctive relief can be granted by this court, therefore the
Whitmires are entitled to the requested temporary injunction order.
Counter-Plaintiffs' Application for Temporary Injunction - Page 5of16
18.
The Whitmires request the court to enjoin the Emighs from managing or
controlling The Weekend Cutter, LLC and World Cutting Horse Association, LLC, as well
as the companies' records, passwords, websites and accounts (financial or otherwise),
order the Emighs to turn over all of the companies' records, passwords, websites and
accounts (financial or otherwise) to the Whitmires for their control and management of the
companies, and order the Emighs to instruct the website managers that the Whitmires
have authority to make changes or additions to the websites.
19.
It is essential that the Court temporarily enjoin the Emighs from these acts
until final trial on the merits of the Whitmires' case. In order to preserve the status quo
during the pendency of this action, the Emighs should be cited to appear and show cause
why they should not be temporarily enjoined from managing or controlling The Weekend
Cutter, LLC and World Cutting Horse Association, LLC, as well as the companies' records,
passwords, websites and accounts (financial or otherwise).
PRAYER
WHEREFORE, PREMISES CONSIDERED, Counter-Plaintiffs Ray Whitmire and
Lainie Whitmire, individually and on behalf of The Weekend Cutter, LLC and World Cutting
Horse Association, LLC, respectfully pray that:
A.
After notice and hearing, a temporary injunction will issue enjoining and
restraining Kennith Emigh and Anna Emigh, Plaintiffs, Plaintiffs' agents, servants,
employees, successors and assigns, and attorneys from directly or indirectly
managing or acting on behalf of The Weekend Cutter, LLC and World Cutting Horse
Association, LLC, and from managing the companies' records, passwords, websites
and accounts (financial or otherwise);
Counter-Plaintiffs' Application for Temporary Injunction - Page 6of16
B.
Order Kennith Emigh. and Anna Emigh to turn over all of the companies'
records, passwords, websites and accounts (financial or otherwise) to Ray and
Lainie Whitmire for their control and management of the companies, and order
Kennith Emigh and Anna Emigh to instruct the website managers that Ray and
Lainie Whitmire have authority to make changes or additions to the websites.
C.
The court set a reasonable bond for the temporary injunction;
D.
For such other and further relief, in law or in equity, to which Counter-
Plaintiffs may be justly entitled.
Respectfully submitted,
By:_--".'--f-"fLL6n...(~~~=======----
Mark E. H ·den
Texas Bar No. 00798239
Email: [email protected]
105-A South Main Street
Weatherford, Texas 76086
Tel. (817) 613.8295
Fax. (817) 599.8418
Attorney for Counter-Plaintiffs
Ray Whitmire and Lainie Whitmire, both
Individually and on Behalf of The Weekend
Cutter, LLC and World Cutting Horse
Association, LLC
Counter-Plaintiffs' Application for Temporary Injunction - Page 7of16
CERTIFICATE OF CONFERENCE
I certify that on March 31, 2015, I contacted the office of Keith Bradley regarding
t this motion.
this Application for Temporary Injunction and Mr. Bradl
CERTIFICATE OF SERVICE
I certify that on March 31, 2015 a true and correct copy of Counter-Plaintiff's
Application for Temporary Injunction was served on Keith Bradley electronically through
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the electronic filing manager.
Counter-Plaintiffs' Application for Temporary Injunction - Page 10of16
NO. DC-C201500023
THE WEEKEND CUTTER, LLC,
WORLD CUTTING HORSE
ASSOCIATION, LLC, KENNITH L.
EMIGH AND ANNA EMIGH
Plaintiffs,
v.
RAY WHITMIRE AND LAINIE
WHITMIRE
Defendants.
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IN THE DISTRICT COURT
413th JUDICIAL DISTRICT
OF JOHNSON COUNTY, TEXAS
AFFIDAVIT IN SUPPORT OF
COUNTER-PLAINTIFFS' APPLICATION FOR TEMPORARY INJUNCTION
BEFORE ME, the undersigned authority, personally appeared Ray Whitmire, who
being duly sworn, deposed as follows:
"My name is Ray Whitmire. I am at least 18 years of age and of sound mind. I am
personally acquainted with the facts alleged herein.
"Lainie Whitmire and myself, along with Kennith Emigh and Anna Emigh, are 50%50% owners of interest in The Weekend Cutter, LLC and World Cutting Horse Association,
LLC. Lainie and I purchased 50% interest in The Weekend Cutter, LLC from the Emighs
for $200,000.00 in cash, with another $50,000.00 to be paid to them from our share of
profits of World Cutting Horse Association, LLC, a company we started together with each
side investing $50,000.00. Lainie and I have invested an additional $60,000.00 in World
Cutting Horse Association, LLC because it did not have the money to pay its obligations
after its first major event.
Counter-Plaintiffs' Application for Temporary Injunction - Page 11 of 16
"Kennith Emigh and Anna Emigh have personally received bartered product from
advertisers with a value exceeding $7 ,000. 00 in exchange for advertising on The Weekend
Cutter, LLC's television show without compensating The Weekend Cutter, LLC.
"Kennith Emigh and Anna .Emigh have received horse. training with a value of
approximately $37,000.00 for their personal horses from horse trainers featured on The
Weekend Cutter, LLC's television show without compensating The Weekend Cutter, LLC.
"Kennith Emigh and Anna Emigh have used company funds belonging to The
Weekend Cutter, LLC totaling at least $10,300.00 for personal expenses, including, but not
limited to, personal meals, fuel, a vet bill, personal credit card expenses, cell phones, and
vehicle and equipment repair without reimbursing the company.
"Kennith Emigh and Anna Emigh have used company funds belonging to World
Cutting Horse Association, LLC totaling at least $3,200.00 for personal expenses,
including, but not limited to, personal meals, fuel, and vehicle and equipment repair without
reimbursing the company, and have attempted to double charge the company for personal .
expenses incurred and paid by World Cutting Horse Association, LLC's funds by crediting
their capital account for the use of the equipment the company paid to repair or service.
The Emighs have also credited their capital account with an exorbitant charge for cattle
hay.
"Kennith Emigh and Anna Emigh have failed to advertise upcoming events on the
World Cutting Horse Association, LLC's website and have prevented Lainie Whitmire from
being able to do so by claiming individual ownership of the web domain and instructing the
website manager not to place anything on the website without Kennith Emigh's permission.
Counter-Plaintiffs' Application for Temporary Injunction - Page 12of16
NO. DC-C201500023
THE WEEKEND CUTTER, LLC,
WORLD CUTTING HORSE
ASSOCIATION, LLC, KENNITH L.
EMIGH AND ANNA EMIGH
Plaintiffs,
v.
RAY WHITMIRE AND LAINIE
WHITMIRE
Defendants.
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IN THE DISTRICT COURT
413th JUDICIAL DISTRICT
OF JOHNSON COUNTY, TEXAS
AFFIDAVIT IN SUPPORT OF
COUNTER-PLAINTIFFS' APPLICATION FOR TEMPORARY INJUNCTION
BEFORE ME, the undersigned authority, personally appeared Lainie Whitmire, who
being duly sworn, deposed as follows:
"My name is Lainie Whitmire. I am at least 18 years of age and of sound mind.
am personally acquainted with the facts alleged herein.
"Ray Whitmire and myself, along with Kennith Emigh and Anna Emigh, are 50%50% owners of interest in The Weekend Cutter, LLC and World Cutting Horse Association,
LLC. Ray and I purchased 50% interest in The Weekend Cutter, LLC from the Emighs for
$200,000.00 in cash, with another $50,000.00 to be paid to them from our share of profits
of World Cutting Horse Association, LLC, a company we started together with each side
investing $50,000.00. Ray and I have invested an additional $60,000.00 in World Cutting
Horse Association, LLC because it did not have the money to pay its obligations after its
first major event.
Counter-Plaintiffs' Application for Temporary Injunction - Page 14of16
"Kennith Emigh and Anna Emigh have personally received bartered product from
advertisers with a value exceeding $7 ,000.00 in exchange for advertising on The Weekend
Cutter, LLC's television show without compensating The Weekend Cutter, LLC.
"Kennith Emigh and Anna Emigh have received horse training with a value of
approximately $37,000.00 for their personal horses from horse trainers featured on The
Weekend Cutter, LLC's television show without compensating The Weekend Cutter, LLC.
"Kennith Emigh and Anna Emigh have used company funds belonging to The
Weekend Cutter, LLC totaling at least $10,300.00 for personal expenses, including, but not
limited to, personal meals, fuel, a vet bill, personal credit card expenses, cell phones, and
vehicle and equipment repair without reimbursing the company.
"Kennith Emigh and Anna Emigh have used company funds belonging to World
Gutting Horse Association, LLC totaling at least $3,200.00 for personal expenses,
including, but not limited to, personal meals, fuel, and vehicle and equipment repair without
reimbursing the company, and have attempted to double charge the company for personal
expenses incurred and paid by World Cutting Horse Association, LLC's funds by crediting
their capital account for the use of the equipment the company paid to repair or service.
The Emighs have also credited their capital account with an exorbitant charge for cattle
hay.
"Kennith Emigh and Anna Emigh have failed to advertise upcoming events on the
World Cutting Horse Association, LL C's website and have prevented Lainie Whitmire from
being able to do so by claiming individual ownership of the web domain and instructing the
website manager not to place anything on the website without Kennith Emigh's permission.
Counter"Plaintiffs' Application for Temporary Injunction - Page 15of16