Pierce, Fenner & Smith, Inc., 562 F.2d 1040, 1049-50 (8th Cir. 1977), cert. denied, 435 U.S. 925, 55 L. Ed. 2d 519, 98 S. Ct. 1490 (1978) (finding no reliance where plaintiff was contractually obligated to sell stock). Rather, Plaintiffs maintain that they would not have signed the escrow agreement if they had known the information which their brother allegedly withheld. They claim that they would have contacted their father to discuss the matter further.
I recognize that there is a problem of causality here. Failure to sign the escrow agreement would not necessarily have prevented James Florig from receiving and exercising the purchase option. The parties can only speculate about what the now-deceased Adolph Florig would have done if his daughters had protested the terms of his gift. However, although it is somewhat speculative, prima facie a parent cares for its child's well-being. There are many exceptions to this rule, and times when children are disinherited, but the record in this case reveals no hint that the decedent wished to shortchange his daughters. Viewing the facts -- and inferences -- in the light most favorable to plaintiffs, I cannot say at this stage that there was no reliance.
5. Economic Loss
Plaintiffs jointly held almost 20 percent of the quarry corporation's outstanding shares. They sold these shares to their brother for $ 625,000. He then sold the corporation for approximately $ 5,000,000. Their alleged economic loss is the difference between the value of their shares under the option contract and the value of the corporation's shares at the time of its sale. The parties thus have presented evidence to support the allegation that the plaintiffs suffered an economic loss because of the defendant's actions.
Because there is evidence in the record to support plaintiffs' securities claims, and because there are genuine issues of material fact, I shall deny summary judgment on these claims.
B. Common Law Fraud Claims
The parties agree that claims for fraudulent misrepresentation and equitable fraud may be treated as the same cause of action. These claims require: (1) a representation, (2) which is material to the transaction at hand, (3) made falsely, with knowledge of its falsity or recklessness as to its truth or falsity, (4) with the intent of misleading another into relying upon it, (5) upon which the plaintiff justifiably relied, and (6) the resulting injury was proximately caused by the reliance. See Gibbs v. Ernst, 538 Pa. 193, 647 A.2d 882, 889 (1994). Because these elements echo those for their securities fraud claims, a similar analysis applies. Under that reasoning, I shall deny summary judgment on these claims as well.
C. Fiduciary Duty and Confidential Relationship
Finally, the defendant argues that Plaintiffs cannot prevail upon their claims that he breached his confidential relationship with them and his fiduciary duty to them. A confidential relationship requires one person to occupy a superior position over another, with the opportunity to use that superiority to the other's disadvantage. Union Trust Co. v. Cwynar, 388 Pa. 644, 131 A.2d 133, 137 (1957). Similarly, for a fiduciary relationship, the plaintiff must show that it reposed its trust and confidence in the defendant, that defendant accepted that trust and confidence, and that the defendant occupied a position of domination and influence. See City Harrisburg v. Bradford Trust Co., 621 F. Supp. 463, 473 (M.D. Pa. 1985); Lehner v. Crane Co., 448 F. Supp. 1127, 1131 (E.D. Pa. 1978). Pennsylvania courts do not presume a confidential or fiduciary relationship exists between family members. In re Scott's Estate, 455 Pa. 429, 316 A.2d 883, 885-86 (1974). Plaintiffs did not respond to Defendant's Motion for Summary Judgment on these claims. Generally, the evidence they submitted does not show that a relationship of trust and confidence existed among these siblings. Nor have Plaintiffs shown that their brother James dominated and influenced them. Because the only relationship clearly existing among these parties is a familial one, I shall grant summary judgment on the claims for breach of confidential relationship and breach of fiduciary duty.
An order follows.
AND NOW, this 10th day of June, 1997:
1. Defendant's Motion for Summary Judgment is GRANTED on Plaintiffs' claims of Common Law Breach of Fiduciary Duty to Disclose and Common Law Confidential Relationship.
2. Defendant's Motion for Summary Judgment on all other claims is DENIED.
BY THE COURT
Robert S. Gawthrop, III, J.