Executive Summary: Key Legal and Evidentiary Issues

• Eric Goldberg unilaterally entered into a settlement disposing of company assets without consulting the other shareholder.

• The Tribunal found that he violated his fiduciary duties under Quebec corporate law.

• Imreco knowingly participated in this breach, constituting tortious interference with LGJ’s internal governance.

• Imreco’s counterclaim was rejected for lack of proof regarding the alleged resale of jointly owned jewels.

• The value of the disputed jewels was assessed based on a prior written offer, not on speculative retail margins.

• Judgment was rendered against both Eric Goldberg and Imreco for jointly causing financial loss to LGJ.

Facts of the case

Lou Goldberg Jeweller Canada Inc. (LGJ), a family-run jewelry business, had longstanding dealings with Imreco Imports Inc., a gemstone supplier. Brothers Joel and Eric Goldberg, co-owners and administrators of LGJ, were embroiled in growing tensions that ultimately led to the company's liquidation in 2016. Prior to the company’s closure, LGJ and Imreco had jointly purchased two valuable sets of stones—one in 2012 (a diamond ring) and another in 2015 (a lot of loose stones), which became the focal point of the dispute.

After Joel’s death in 2019, his widow, Diane Soroka, inherited his shares. In August of that year, while LGJ was inactive and without Soroka’s knowledge or consent, Eric Goldberg accepted a deal with Imreco that extinguished LGJ’s debt of roughly $5,000 in exchange for surrendering its share in the jointly purchased jewels—assets worth over $30,000. This agreement, referred to as the “2019 agreement,” lacked transparency, internal consultation, and any evidence of equitable consideration for LGJ.

When Soroka later took over LGJ’s administration, she discovered that no proceeds from the jewels had been received. LGJ initiated legal action against Eric Goldberg and Imreco, claiming breach of fiduciary duty and tortious interference, respectively. Imreco responded with a counterclaim alleging that LGJ had previously sold the jointly owned jewels in 2014 without remitting Imreco’s share.

Outcome of the decision

The Court found in favor of LGJ. It concluded that Eric Goldberg had acted imprudently and in breach of his duty of loyalty by finalizing the 2019 agreement unilaterally, knowing Soroka was a shareholder and deliberately excluding her from the decision-making process. The Court determined that the agreement disadvantaged LGJ by exchanging high-value assets for the mere cancellation of a minor debt, without any documentation of proper valuation or authorization.

Imreco was also held liable for its role in facilitating and benefiting from the improper deal. The Court found that Imreco was well aware of the family conflict, Goldberg’s limited authority, and the refusal of a similar offer by Joel Goldberg in 2018. It ruled that Imreco had intentionally disregarded its duty to verify internal consent and had acted in bad faith.

Imreco’s counterclaim—alleging that LGJ had wrongfully sold the 2012 diamond ring in 2014—was rejected due to lack of reliable evidence. The Court found that the ring remained in Imreco’s possession and that any internal invoice adjustments by Eric Goldberg were unreliable, given prior manipulation of accounting records.

Ultimately, the Court awarded LGJ $30,840.17 in damages, holding Eric Goldberg and Imreco in solidum (jointly and severally) liable. The judgment reinforces corporate governance principles under Quebec civil law, emphasizing diligence, honesty, and the avoidance of conflicts of interest by directors.