Alsco v. Fatty's BarAnnotate this Case
At issue in this appeal before the Idaho Supreme Court was the doctrine of successor liability and its applicability to a business known as “Fatty’s Bar” (“Fatty’s”). Tons of Fun, LLC opened Fatty’s in October 2010 and a short time later its manager, Clay Roman, signed a textile services agreement with Alsco, Inc. The Agreement contained an automatic renewal clause, by which the Agreement would renew automatically for a period of 60 months if neither party terminated it in writing at least 90 days before its initial expiration. Fatty’s fell on difficult financial times, and closed for a period in January 2013. Soon after, Steven and Jennifer Masonheimer created a limited liability company called Fatty’s Bar, LLC, and re-opened Fatty’s in mid-February, 2013, continuing to receive textiles from Alsco. The Agreement automatically renewed in March 2016. In March 2017, Fatty’s Bar, LLC terminated the Agreement, well before the 60-month term was set to expire. Alsco then sued Fatty’s Bar, LLC and Clay Roman, seeking damages based on a liquidated damages provision in the Agreement. After a court trial, the district court held that both Fatty’s Bar, LLC and Roman, were jointly and severally liable to Alsco for damages under a liquidated damages clause that was also in the Agreement. Fatty’s Bar, LLC appealed. Finding no reversible error, the Idaho Supreme Court affirmed.