Industry News | April 6, 2006

Judge Rules in Rich Boyd's Favor in In-N-Out Lawsuit

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Fagelbaum & Heller attorneys report that Los Angeles Superior Court Judge Aurelio Munoz ruled today in favor of Rich Boyd in his lawsuit against In-N-Out Burgers Inc.

In a SLAPP motion ruling Judge Munoz threw out certain claims in the In-N-Out suit against Boyd. The judge determined that two of In-N-Out's claims are legally unsustainable. Boyd argued that the two claims, breach of contract and breach of fiduciary duty, had violated the exercise of his constitutional free-speech rights.

In-N-Out's claim that Boyd violated his employment contract and duty to the company is an illegal "SLAPP" lawsuit, Boyd had stated in papers presented to the court.

A SLAPP lawsuit -- Strategic Lawsuit Against Public Participation -- is a lawsuit to prevent or punish a person's exercise of the rights to free speech and to petition the government for redress of grievances, guaranteed by the federal and California constitutions. SLAPP lawsuits are prohibited under California law.

Philip Heller, Boyd's attorney, said: "Mr. Boyd is very pleased with today's court ruling. He is trying faithfully to execute his duties, but In-N-Out is attempting to keep him from telling the truth about what is going on in the company."

Thomas J. Nolan, co-counsel for Boyd, said: "Today's ruling is significant because this was a classic example of a SLAPP lawsuit, brought to chill the valid exercise of constitutional rights. Mr. Boyd prevailed and he will now seek redress of his grievances in court."

In-N-Out sued Boyd after he complained that 23-year-old Lynsi Martinez, the sole heir of the In-N-Out founding family, is trying to circumvent the wishes of family matriarch Esther Snyder, Martinez' late father Guy Snyder, and late uncle Richard Snyder regarding management and the future direction of the privately held company. Boyd was an In-N-Out corporate director and co-trustee of the Snyder family trusts, which hold a controlling interest in the company.

The Snyder family trusts provide that Martinez will inherit full control of In-N-Out on her 35th birthday. According to Boyd's court papers, Guy Snyder did not want his daughter to inherit the family business until she was mature enough to handle the responsibility. Boyd told the court that Martinez does not want to wait until then, and her lawsuit is an attempt to force him out so that she can take over the burger chain now.

Heller said, "As a co-trustee of the trusts, Boyd has adhered to the policies and procedures put in place by Esther Snyder, Guy and Richard Snyder."

Boyd has had a 21-year career with In-N-Out Burgers Inc. He served the privately held company as vice president, corporate director, and co-trustee of the Snyder family trusts.