Taylor Armstrong Loses Round in Court

BHCourier.com:

Taylor Armstrong lost a round in court today in a lawsuit brought against the "Real Housewives of Beverly Hills" co-star and her late husband by an online provider of health records. 

Los Angeles Superior Court Judge Frederick Shaller denied a motion by Armstrong's attorney to throw out part of a settlement agreement between the Armstrongs and MyMedicalRecords.com that called for payment of $1.5 million to either party if one side breached the agreement -- called a liquidated damages clause. 

"There is no evidence of the circumstances existing at the time the contract was made to enable the court to find that the liquidated damage clause is unreasonable," Shaller wrote in his four-page decision. 

MyMedicalRecords.com filed suit against Armstrong and her husband, Russell, last July 29. The couple were in the process of a divorce when he was found hanged in a bedroom of his Mulholland Drive home on Aug. 15, but the lawsuit continued against his estranged wife. 

Russell Armstrong had been the largest shareholder of the company, which provides secure personal health records and electronic safe deposit box storage solutions. 

After company officials found he allegedly misappropriated investor money and diverted shares of the company, he was removed from the board and settled with the firm for $250,000. Under the terms of his original settlement, Armstrong was required to identify anyone to whom he had sold shares of MMRGlobal, parent company of MyMedicalRecords.com. 

When he failed to do so, he and his wife were sued for breach of contract. 

In his court papers, defense lawyer Michael Gless stated that the company already knew the name of one of the persons sold shares and that there was no proof the couple should have disclosed the names of the other two buyers. 

Gless also stated that even if the Armstrongs failed to disclose the names according to the agreement, the firm's damages were "in the range of hundreds of dollars, not millions." 

But Shaller found the argument unpersuasive. 

"The motion must be denied since even if (Taylor Armstrong) is correct that the liquidated damages clause is unenforceable, this alleged unenforceability does not bar plaintiff's claim and would not entitle defendant to a judgment in her favor," he wrote.

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