A lawsuit filed by Milwaukee-based Mortenson Kim Inc. against a former company executive is headed to arbitration following a ruling by U.S. Magistrate Judge William Duffin.
In the lawsuit, filed in September, Mortenson Kim accused Shannon Safar, the company’s former president, of allegedly using a business opportunity with the Indiana lottery to secure an ownership interest in the company.
In response to the lawsuit, Safar asked Duffin to require the parties to take the dispute to an arbitrator, arguing the agreements that gave her a stake in the company’s ownership required disputes to be handled that way.
Mortenson Kim, which provides integrated marketing services including public relations and advertising, argued those agreements were made under “economic duress” and should be considered void. Duffin determined Mortenson Kim was not alleging that economic duress caused the company to agree to the arbitration provisions.
“It challenges the contracts in their entirety. That challenge must go to the arbitrator,” Duffin wrote in a Nov. 30 order.
Safar had also asked Duffin to dismiss the case entirely, but he sided with Mortenson Kim and stayed proceedings “because there might be ground to later reinstate it.”
The parties are to report back with the results of arbitration once one is reached and will then have 30 days from the final decision to have the case reinstated.
“We have every confidence in our justice system, but since this is a pending legal matter, we have been advised not to discuss it. Mortenson Kim has had tremendous success over the last five years, and 2017 will be our strongest year in over a decade,” said Chris Mortenson, Mortenson Kim chief executive officer, in a statement.
Attorneys for Safar did not immediately respond to requests for comment.