Indiana Court of Appelas and Joint Ventures

The Indiana Lawyer reports that the Indiana Court of Appeals has a new decision regarding joint ventures: COA sides with Lauth in casino suit

Lauth filed a motion for summary judgment in June 2006 claiming that the agreement formed a joint venture at most and that it was terminated when the Gaming Commission chose Trump over Lost River's proposal. At the trial level, Judge Nation dismissed that motion, finding that it didn't contemplate a second bid proposal and that federal caselaw says that a formed joint venture agreement generally "remains in force until its purpose is accomplished or that purpose becomes impracticable."

The Court of Appeals disagreed, and its ruling gives guidance as to when a joint venture agreement ends if nothing is written or specifically detailed about how it ends.

"In conclusion, we hold that if a joint venture is formed for the purpose of submitting a proposal or similar bid, and the joint venture agreement is silent as to when or under what circumstances that venture will end, then the joint venture ends when the proposal or bid is rejected," the court wrote.

In this case, the Lost River joint venture ended as a matter of law when the IGC chose Trump Indiana. As a result, Lauth didn't breach the agreement and the trial judge erred in denying Lauth's motion for summary judgment, the appellate court said.