Even though the Eagles checked out of a partnership with their guitarist, they're finding they can never leave.

After a legal fight with former guitarist Don Felder stretching back nearly four years, the band lost a critical court ruling and will now have to go to trial.

Felder claims that Don Henley and Glenn Frey conspired with longtime manager Irving Azoff to oust him from the band when the reunited band signed a new rights agreement in 2000. Felder, who was the guitarist from 1974 to 1980, says he was forced into signing new agreements unfairly benefiting Henley, Frey and Azoff.

Felder sued Henley and Frey in 2001 for breach of contract and wrongful termination and sought to dissolve the corporation, Eagles Ltd. He sued Azoff three years later, but dismissed an earlier demand to dissolve the company after the suits were consolidated.

In August 2004, Azoff, later joined by Henley and Frey, tried to arbitrate the matter rather than go to trial. A Los Angeles Superior Court judge granted the request, but Felder petitioned the appellate court to review the order.

Last month, a three-judge appellate panel in the 2nd Appellate District ruled the defendants waived their right to arbitrate by requesting thousands of pages of discovery. A trial date was scheduled for Jan. 31.

Larry Feldman, counsel at Kaye Scholer LLP representing Azoff, said he planned to petition the California Supreme Court, which would put the trial on hold.

Thomas Jirgal, counsel at O'Melveny & Myers LLP representing Henley, Frey and the Eagles corporations, declined to comment. Felder's lawyer, Joel Klevens, a partner at Christensen Miller Fink Jacobs Glaser Weil & Shapiro LLP, said he expects a trial to begin this spring.

Dealer Deals

The namesake of what was once the state's largest Chevrolet dealership won a court ruling last month in a breach of contract case against a company whose employees allegedly tarnished his name by defrauding customers.

Scott Gunderson was a shareholder in a company that operated an El Monte auto dealership called Gunderson Chevrolet. In 1998, the dealership and the Gunderson trade name were sold to Republic Industries as one of 31 new-car franchises bought for $230 million in cash.

Gunderson had signed a trade name agreement for himself as an individual allowing Republic to temporarily use his name. He claims that Republic, now AutoNation Inc., breached the letter agreement by committing crimes.

In 2002, four former Gunderson Chevrolet employees, including the general manager, pleaded no contest to charges they cheated customers out of thousands of dollars each by selling products and services without their knowledge. Under a 2001 settlement, Gunderson Chevrolet agreed to pay $900,000 plus legal costs to the state's Department of Motor Vehicles and the Los Angeles County District Attorney's Office, and $1 million to consumers. The dealership is now Power Chevrolet El Monte.

On Dec. 27, a three-judge panel in the 2nd Appellate District reinstated Gunderson's suit after a Los Angeles Superior Court judge threw it out.

The appellate panel ruled Republic "was not expressly authorized to engage in criminal activity under the 'Gunderson' name pursuant to the letter agreement."

As the on-site manager and founding shareholder of the company that ran Gunderson Chevrolet, Gunderson believed he owned the Gunderson trade name when he negotiated the letter agreement in 1998, according to D. Wayne Leech, an El Monte attorney representing him.

Daniel Katz, a partner at Williams & Connolly LLP representing Republic, said he plans to petition the 2nd Appellate District for a re-hearing or, alternatively, petition the California Supreme Court.

"No fact finding of any sort whatsoever has been made in his favor," he said of Gunderson.

Staff reporter Amanda Bronstad can be reached at (323) 549-5225, ext. 225, or at abronstad@labusinessjournal.com .

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