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April 16, 1991


James F. Holderman, United States District Judge.

The opinion of the court was delivered by: HOLDERMAN


 Defendants in this case, First Chicago Corporation, First National Bank of Chicago ("First Bank"), First Capital Corporation of Chicago, First Chicago Investment Corporation, and Richard C. Gallagher, have moved for summary judgment on the remaining counts of the amended complaint of plaintiff Shields Enterprises, Inc. ("SEI"). For the reasons stated below, defendants' motion must be granted.


 The facts of this lawsuit concern the ownership and sale of shares of a corporation called Cellular Business Systems, Inc. ("CBSI").

 In the spring of 1983, SEI, Martin Cooper, and Arlene Harris formed CBSI. CBSI was a non-public corporation which specialized in computer billing services for the growing cellular telephone business. In exchange for cash and services, SEI, Mr. Cooper and Ms. Harris each acquired one-third of the outstanding stock of CBSI.

 On June 8, 1984 the three CBSI shareholders entered into various agreements, one of which required the unanimous consent of all shareholders for any transfer or sale of CBSI stock ("Stockholders' Agreement"). The Stockholders' Agreement also gave first CBSI, and then each shareholder, a right of first refusal in the event another shareholder received an offer to buy his or her shares. *fn1"

 CBSI experienced rapid success. It soon became apparent that CBSI could, with a large capital infusion, command a large portion of the market for cellular telephone billing services. In 1984 First Bank expressed an interest in investing in CBSI. Until First Bank could proceed with plans for a larger investment, however, it provided interim financing to CBSI through a series of loans totalling $ 1.2 million.

 In exchange for contribution of their stock, SEI, Mr. Cooper, and Ms. Harris each received a one-third ownership interest in Technology Group. Pursuant to a written agreement, the three owners of Technology Group agreed that they would not sell Technology Group's CBSI stock without the unanimous consent of all three. The March 28, 1985 agreements also incorporated the parties' June 8, 1984 Stockholders' Agreement. One result of this incorporation was that first Technology Group, and then each shareholder, had a right of first refusal in the event another shareholder received an offer to buy his or her interest in the shares of CBSI held by Technology Group. *fn3"

 CBSI experienced significant growth throughout the summer and fall of 1985. According to defendants, however, despite this growth, from March of 1985 through June of 1986 CBSI encountered severe management and operational problems, as well as fiscal problems.

 In late October of 1985 defendants planned to infuse $ 2 million in capital into CBSI. According to plaintiff, in an October meeting defendants stated that they would refuse to allow Technology Group to participate in the capital infusion. *fn4" Instead, defendants insisted on purchasing all of the additional $ 2 million stock themselves at a price of $ 4 per share. According to plaintiff, because they feared dilution of their interest in CBSI, SEI, Mr. Cooper and Ms. Harris desired to share in the purchase of the new CBSI shares to be issued.

 In mid-December of 1985 defendants and Technology Group purchased the new CBSI shares together. The shares were purchased for $ 4 per share, and in amounts which would maintain the parties' proportionate interests in CBSI (approximately 54.5% for defendants and 45.5% for Technology Group). Plaintiff contends, however, that defendants "forced" Technology Group to make its almost $ 1 million capital contribution by threatening to dilute Technology Group's interest in CBSI by purchasing all new shares at the "artificially low price" of $ 4 per share. (Amended Complaint, paras. 25-26.)

 In late March of 1986, Richard Gallagher replaced a gentleman named Scott Marks as the primary First Bank representative overseeing the bank's CBSI investment. On March 26, 1986 Mr. Gallagher became a member of CBSI's board of directors.

 Ultimately, Mr. Cooper, who had been acting as the Chief Executive Officer and Chief Operating Officer of CBSI, decided he wanted to sell CBSI. According to plaintiff, Mr. Cooper wanted to sell CBSI because defendants had threatened to dilute his interest in CBSI.

 In the last quarter of 1985 Mr. Cooper met with John T. LaMacchia, president of Cincinnati Bell, about a possible sale of CBSI to Cincinnati Bell. In March of 1986 Mr. Cooper again discussed with Cincinnati Bell the possibility of selling CBSI.

 At about the same time, Mr. Cooper informed defendants of his belief that CBSI was about to lose one of its key customers, Metromedia, Inc., which accounted for 25% of CBSI's business and revenues. Around this time, defendants also learned of Mr. Cooper's negotiations with Cincinnati Bell about a possible sale of CBSI.

 On April 17, 1986, Mr. LaMacchia and other representatives of Cincinnati Bell met with Mr. Shields, Mr. Cooper, and Mr. Gallagher. They discussed the possible sale of CBSI to Cincinnati Bell.

 On April 29, 1986, SEI, Mr. Cooper, Ms. Harris, First Capital and First Investment entered into an Allocation Agreement. The Allocation Agreement structured how the payments from Cincinnati Bell would be distributed to CBSI's shareholders in the event the sale occurred. Mr. Shields signed that agreement. According to Mr. Shields, however, he believed the Allocation Agreement to be conditional only, and to not create any binding obligation to later agree to the sale of CBSI to Cincinnati Bell.

 The Allocation Agreement provided that of the $ 13 million Cincinnati Bell was to pay to CBSI shareholders at closing, First Capital/First Investment would receive $ 10 million and Technology Group would receive $ 3 million. After closing, Cincinnati Bell would make contingent cash payments of approximately $ 7 million, to be divided approximately 25% to First Capital/First Investment and 75% to Technology Group.

 According to Mr. Shields, despite his signing of the Allocation Agreement, he objected both to the price and to the sale of CBSI to Cincinnati Bell. Mr. Shields claims he signed the Allocation Agreement merely to "buy time" to convince Mr. Cooper that Metromedia would not be lost as a CBSI customer.

 On April 25, 1986 Mr. Shields allegedly telephoned Mr. Cooper to inquire about a possible purchase of Mr. Cooper and Ms. Harris' interest in Technology Group. According to plaintiff, faced with both SEI's offer to buy Mr. Cooper's and Ms. Harris' stock and Mr. Shield's objections to the sale of CBSI to Cincinnati Bell, defendants engaged in threats to prevent Mr. Cooper and Ms. Harris from selling ...

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