Trial begins in lawsuit over sale of company

Partners at two of Missouri’s largest law firms are going up against each other in a case involving an ousted company president who lost out on a cut of a $48 million merger.

Jurors in Jackson County Circuit Court heard opening statements Wednesday in the case Patricia Aspenleiter filed against ViraCor Laboratories, located in Lee’s Summit.

Plaintiff attorneys from Bryan Cave in Kansas City contend that when company founder and owner Phillip Short fired her in 2007, she should’ve retained her 15 percent ownership interest.

“Short and ViraCor promised ownership to Patti,” said Robert Hoffman, of Bryan Cave. “Patti relied on that promise. She did the work. Short and ViraCor did not honor their end of the deal.”

But defense attorneys from Husch Blackwell Sanders in Kansas City argue Short is the company’s only legal member, or owner, and that she forfeited her ownership interest when she was terminated for cause. Short fired Aspenleiter after a string of events involving her relationship with an employee whom she later married, said James Griffin, of Husch. Short claims her ownership interest only existed for the purposes of the company’s eventual sale, which took place roughly two years after her termination.

“Aspenleiter knew of the upside of the ownership,” Griffin said. “And she knew those who were terminated for cause … got back basically what they’d put in.”

Aspenleiter, of Overland Park, Kan., joined the then-startup diagnostic laboratory in 2000. ViraCor was taking in roughly $300,000 in annual revenue at the time, but Aspenleiter testified Wednesday that she helped build up the company to multi-million-dollar status by identifying and marketing its current niche.

The laboratory specializes in virus detection, particularly in organ transplant patients.

Griffin said ViraCor uses a special technological process that allows the company to offer a 24-hour turnaround on specimens. Griffin said the company was the first commercial lab in the United States to use the Real Time PCR technology and remains the only lab in the country that guarantees test results within 24 hours.

The company’s growth exploded for the next eight years. ViraCor in July 2009 merged with IBT Laboratories, bringing its worth up to $48 million.

Hoffman presented to jurors letters from Short to Aspenleiter in which he sang her praises for the company’s boom. He also showed other documents that outlined her 15 percent ownership interest.

Aspenleiter claims that when she was hired, Short verbally offered her a 2 percent ownership interest in the company and that her ownership gradually increased.

When Robert Thompson, Bryan Cave’s managing partner in Kansas City, asked if Short told her she would lose the ownership if she was terminated for cause, Aspenleiter answered no.

Aspenleiter isn’t alleging wrongful termination, instead focusing on counts of fraudulent misrepresentation and breach of contract.

“We don’t think it’s about employment or termination,” Hoffman said of the case.

The defense focused most of his opening statements on the cause for termination, however.

Griffin said her “loss of credibility” and “ruptured relationship” with Short prompted the termination, ending her ownership interest.

Hoffman explained his client did have a romantic relationship with a subordinate employee, Kent Klepper, but that Short knew about the relationship – a much disputed point. Aspenleiter was promoted from vice president to president in May 2006 and she promoted Klepper that June. Klepper voluntarily left the company in February 2007, when company leaders learned about the relationship for the first time, Griffin said.

Several days after a March 6, 2007, confrontation between Short and Aspenleiter, she was placed on administrative leave. She was officially terminated on May 30, 2007, with three months’ severance pay.

Griffin said the jurors would have to decide “if her ownership interest would survive termination for cause,” laying out examples of prior fired employees who lost their “end of the rainbow” ownership interest at termination.

Griffin said Aspenleiter never invested money in to the company, wasn’t responsible for the guaranty of loans, didn’t assume any risk of losses and had no tax liability for profits, while Short could answer in the affirmative on all of those points.

Aspenleiter said Wednesday she originally negotiated for ownership in the company because she knew she would put “sweat equity” into it.

The case is Aspenleiter v. ViraCor et al., 0716-CV19207.