TIMOTHY M. McCANN and THOMAS M. McCANN, Plaintiffs,
SHEILA McCANN and PAUL J. McCANN, JR., individually and in their capacities as Director(s) and/or Officer(s) in the corporate defendants; PAUL J. McCANN, JR., individually and in his capacity as co-conservator of ANNE MARIE McCANN, and DOUGLAS WOLD, individually and in his capacity as counsel and co-conservator of ANNE MARIE McCANN; JEFFERSON MANAGEMENT COMPANY, a Montana Corporation; GNI, INC., a Delaware Corporation; DDI, INC., a Montana Corporation; FDC-MT, INC., a Montana Corporation M Corp, a Montana Corporation; TSI, INC., a Montana Corporation; DRI, INC., a Montana Corporation; FIRST MONTANA TITLE COMPANY, a Montana Corporation; LANDCO, Corporation; WESTERN LAND CORP., a Delaware Corporation; WESTERN SECURITIES COMPANY, a South Dakota Corporation; WESTERN SECURITIES, a Minnesota Corporation; UAC INC., a Montana Corporation; MERRITT PROPERTIES INC., a Montana Corporation, EMPIRE TITLE INC., a Montana Corporation; MIRAMAR INC., a Montana Corporation; LAKE PLACE, INC., a Montana Corporation; FDC INC, a Delaware Corporation; and CONSULTING ASSOCIATES INC., a Montana Corporation, Defendants and Appellees. GENET McCANN, Plaintiff and Appellant,
Submitted on Briefs: July 25, 2018
District Court of the Thirteenth Judicial District, In and
For the County of Yellowstone, Cause No. DV 14-1273 Honorable
Russell C. Fagg, Presiding Judge
Appellant: Genet McCann, self-represented, Big Sky, Montana
Appellees: Mark D. Parker, Parker, Heitz & Cosgrove,
PLLC, Billings, Montana (for McCanns), Guy W. Rogers, Jon
Wilson, Brown Law Firm, P.C., Billings, Montana (for Douglas
Genet McCann (Genet) appeals from the District Court's
entry of judgment as a matter of law in favor of the
Defendants, including individuals and corporate entities, at
the close of her case-in-chief in the bench trial held on her
claims. We affirm and remand for a determination of attorney
fees, addressing the following issues:
1. Did the District Court err by granting the motion for
judgment in favor of the McCann and corporate
2. Did the District Court err by granting the motion for
judgment in favor of Defendant Douglas Wold?
3. Did the District Court err in granting Wold attorney
4. Was Genet denied a fair trial?
5. Should Genet be declared a vexatious litigant?
AND PROCEDURAL BACKGROUND
Paul McCann, Sr. (Paul Sr.) passed away in 2013, and his
estate included considerable assets, including ownership
interests in a number of corporations. After Paul Sr.'s
death, a guardianship and conservatorship of his wife,
A.M.M., and her interests were established due to her
diminished capacity. Paul Sr. and A.M.M. have eight adult
children, including five who were involved in related legal
proceedings: Thomas McCann, Paul McCann Jr. (Paul Jr.),
Genet, Timothy McCann, and Sheila McCann (Sheila).
The District Court appointed Paul Jr. and attorney Douglas
Wold to serve as co-conservators of A.M.M.'s estate.
Genet, either personally, or as counsel for Timothy, has been
involved in unsuccessful litigation challenging the
guardianship and conservatorship, including three appeals to
this Court. In re Guardianship & Conservatorship of
A.M.M., 2015 MT 250, 380 Mont. 451, 356 P.3d 474 (In
re A.M.M. I); In re Guardianship &
Conservatorship of A.M.M., 2016 MT 213, 384 Mont. 413,
380 P.3d 736 (In re A.M.M. II); and In re
Guardianship & Conservatorship of A.M.M., No. DA
16-0729, 2017 MT 227N, 2017 Mont. LEXIS 566 (In re A.M.M.
III). Genet was licensed to practice law in Montana, but
since the trial in this matter, has been disbarred due to
professional misconduct in the guardianship proceedings.
In re McCann, 2018 MT 140, 391 Mont. 443, 421 P.3d
265 (In re McCann I); In re McCann, No. PR
16-0635, Or. (Mont. June 6, 2018) (In re McCann II).
Genet has attempted to challenge her disbarment several times
in U.S. District Court, so far unsuccessfully. In re
McCann, No. CV 18-02-H-SEH (D. Mont. Jan. 11, 2018)
(In re McCann III), mandamus denied, No.
18-71154, 2018 U.S. App. Lexis 10532 (9th Cir. Apr. 25,
2018); In re McCann, No. CV 18-03-H-SEH (D. Mont.
Jan. 11, 2018) (In re McCann IV); McCann v.
Supreme Court of Montana, No. CV 18-42-H-SEH (D. Mont.
June 11, 2018) (McCann v. Supreme Court I);
McCann v. Supreme Court of Montana, No. CV
18-57-H-SEH (D. Mont. June 11, 2018) (McCann v. Supreme
In September 2014, Genet, Thomas, and Timothy brought this
action against the named corporate Defendants, which are
affiliated with the estate; against Sheila and Paul Jr.,
individually and in their role as directors or officers of
the corporate Defendants; and against Paul Jr. and Wold,
individually and in their capacity as co-conservators of the
estate. Subsequently, Thomas and Timothy withdrew and
settled, respectively. Although naming Wold, Genet did not
serve him until January 2017, over two years after she filed
the complaint and seventeen days before trial. Wold
nonetheless appeared ready to defend.
On the scheduled day for trial, Genet arrived several hours
late. The District Court introductorily noted that
Genet's claims were "not entirely clear," but
understood them to constitute a derivative action seeking
forced dissolution of the corporations based upon allegations
of corporate oppression under § 35-1-938(2)(b), MCA.
Genet proceeded to offer evidence in support of her case,
which focused primarily on allegations of corporate records
mismanagement. Genet called several witnesses, including
court-appointed auditor Natalya Abdrasilova, CPA, who
testified that she found missing or incomplete stock records,
and court-appointed signature analyst Brent Lund, who
identified possible forgeries on several stock certificates.
Genet also offered testimony, including by a priest, who
testified about the wishes of A.M.M., an issue that had
previously been litigated in the guardianship and
During cross-examination of these witnesses, the defense
attempted to demonstrate that any failure to properly
maintain records had occurred long ago, and that the
Defendants, particularly Paul Jr. and Wold, had worked
diligently to correct and bring current the corporate
shareholder list and financial records. Testimony indicated
that the legal standing of the corporations had been
neglected or mismanaged in Paul Sr.'s later years, but
this had substantially improved due to the efforts of Paul
Jr. and Wold. The District Court, Hon. James Manley
presiding, had approved annual conservatorship accountings
and granted permission for Wold to serve as counsel to
resolve legal issues related to the corporations, including
wage claims, record requests, an issue with the State
Auditor, and unpaid taxes. The original twenty corporations
had been structurally reorganized and reduced to eleven
corporate entities. Numerous board of director and
shareholding meetings had been conducted and, for the first
time in a long time, the corporations paid stockholder
dividends, which totaled four million dollars during 2016.
The reorganization included a process of gifting shares from
one of the corporations to the heirs of the estate, including
At the close of Genet's case-in-chief, the McCann and
corporate Defendants moved for judgment as a matter of law,
arguing Genet had failed to prove her oppression claim.
Specifically, they argued they had already corrected past
shortcomings in the management of corporate records, and
these matters were insufficient to establish oppression. The
District Court granted the motion, reasoning that Genet
"wholly failed" to establish an oppression claim.
Likewise, the District Court granted Wold's motion for
judgment as a matter of law, concluding an oppression claim
could not be maintained against Wold because he was not a
director and that the only control he had asserted over the
corporations was in his role as a co-conservator of
A.M.M.'s estate-an issue Genet was collaterally estopped
from relitigating in this proceeding. Further, the District
Court held Genet had presented no evidence that Wold had
engaged in any false reporting or other misconduct, stating
Wold's actions "both as co-conservator and as legal
counsel were of high quality and in conformance with his
ethical and fiduciary duties . . . ."
Following trial, the District Court granted Wold attorney
fees pursuant to the equity exception to the American Rule,
reasoning that "since there is no basis for the claims
against Mr. Wold, [Genet] never should have named him as a
party and had no reason to sue him . . . . Such an award is
necessary to make Mr. Wold whole and is supported by justice,
equity, and good conscience." Alternatively, the
District Court held that Wold was entitled to fees under
§ 35-1-547(2), MCA, to the extent the case was a
derivative action, acknowledging again that Genet's
claims against Wold were not entirely clear. The District
Court granted Wold both his pro se fees for
preparing to defend the case, attorney fees for counsel he
hired to defend him at trial following service of process,
and costs. In total, the District Court awarded Wold $56,
055.50 in fees and costs.
Genet appealed the District Court's entry of judgment
against her claims and the imposition of attorney fees and
costs. The McCann and corporate Defendants filed a combined
response brief on appeal, and Wold filed a separate response
brief. All of the Defendants requested, in their briefing,
that Genet be declared a vexatious litigant by this Court.