Kirzhner v. Silverstein, 870 F. Supp. 2d 1145

Contract for stock sale of 5,000,000 shares (50% of BMGI) by Kirzhner to Silverstein, secured by the stock via a note; Silverstein defaulted on payments; dispute over plaintiff’s remedies under the contract; court had previously dismissed/denied various motions on express vs implied claims; multiple restructurings and transfers of BMGI assets occurred, including insolvency, foreclosures, and a merger between BMGI and Delaware BMGI; plaintiff asserted nine claims including breach of 2.03, implied covenant, fraud, fiduciary duties, fraudulent transfer, conspiracy and accounting; several motions to dismiss and to compel discovery were decided prior to the current order; procedural posture includes several pending magistrate judge motions and consolidation-related proceedings

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether replacement collateral/valuation satisfies 2.02–2.03 without independent audit	Valuation of BMGI plus replacement collateral must meet unpaid price	No independent valuation; potential substitution may suffice	First claim dismissed for lack of independent valuation
Whether there is an actionable implied covenant claim against BMGI despite express good-faith clause	Implied covenant survives regardless of express terms	Express clause precludes implied remedy	Second claim against BMGI survives summary judgment; implied covenant recognized
Whether fraud claim against all defendants can be resolved on summary judgment	Fraud evidenced by concealment and misrepresentations	Insufficient pleading under standard or lack of material facts	Fraud claim denied as to BMGI at summary judgment stage (denied); remains actionable
Whether the Colorado Uniform Fraudulent Transfer Act claim can be dismissed on summary judgment	Transfers were fraudulent to impair collateral	No actionable transfer or lack of creditor status; successor entities complicate	Fraudulent transfer claim denied as to summary disposition; issues remain
Effect of sole remedy clause on damages claim against Silverstein for implied covenant	Damages recoverable under implied covenant despite sole remedy	Sole remedy clause bars damages against Silverstein	Second Claim dismissed against Mr. Silverstein; sole remedy clause applies to damages

Shelton v. American Motors Corp., 805 F.2d 1323 (8th Cir. 1986) (discovery of opposing counsel files limited; protectiveness applies)
Thiessen v. General Electric Capital Corp., 267 F.3d 1095 (10th Cir. 2001) (limits on discovery of privilege documents; in camera review not always required)
Boughton v. Cotter Corp., 65 F.3d 823 (10th Cir. 1995) (discovery and privilege considerations in complex litigation)
Amoco Oil Co. v. Ervin, 908 P.2d 493 (Colo. 1995) (implied covenant exists in contracts; cannot contradict express terms)
Alpine Bank v. Hubbell, 555 F.3d 1097 (10th Cir. 2009) (implied covenant cannot rewrite express terms; governs discretionary actions)
Miller v. Kaiser, 164 Colo. 206, 433 P.2d 772 (Colo. 1967) (fraudulent transfer remedies; restoration principle)