Concerning the joint-venture analysis, where two otherwise independent entities team up to pursue a business opportunity for profit, or to jointly develop a product for possible future commercial exploitation, they can readily satisfy the technical definition of a "general partnership" under the Revised Uniform Partnership (a joint venture being in essence one species of "general partnership," basically formed for a specific purpose instead of a broader collaboration). Under RUPA, the law can conclude that such a partnership has been legally formed whether or not the parties intended to form it and whether or not they sought to document it in writing.
Thus, given the critical elements - (1) a commercial teaming and (2) an intent to share profits - one can legally form a partnership or joint venture and incur the duties of a partner or joint venturer to the other party involved, quite without intending to embrace any such legal structure. This area of law can thus easily catch a party by surprise and lead to imposition of potential surprise legal liabilities. In effect, the profit-minded goals of the parties, combined with their statements and actions in teaming to further those goals, give rise to legal duties that they owe to one another even if they never intended to embrace a formal legal relationship. The greatest of these duties is that every partner (or joint venturer) owes a fiduciary duty to every other partner (or venturer) in the partnership or joint venture. A fiduciary duty is a far stricter one than is normally represented by arms-length dealing. It is, rather, a duty to act in the highest good-faith toward one's fellow partners and includes having to act in the best interests of the partnership in relating to the venture. This axiomatically means, of course, that one cannot appropriate for one's own use and profit the subject matter of the venture and at the very least cannot do so without compensating the other partners for the value of what is being taken.
Here, given the procedural context of a preliminary injunction application, the court was not required to, and did not, make any ultimate findings about whether these parties had in fact formed a joint venture. However, the court ruled that TC had made a credible showing that such a venture existed, not generally in the broader proposed business relationship that the parties had been continually negotiating and whose terms were probably wildly unclear but rather with respect to the product development itself. In other words, with TC having delivered specs for the product, as well as having contributed money and engineering resources to further its development, and with FG having gladly accepted all this and having done so while trumpeting the joint development efforts to the world, the court said that this likely amounted to a joint venture for the product development itself and, with that product constituting an asset of the joint venture, one venturer (FG) could not simply misappropriate that asset to its own use without breaching fiduciary duties owed to its fellow venturer (TC). The court said that it amounted to a breach of fiduciary duty for FG to do this without settling up with TC as its fellow venturer by compensating TC for the value of the anticipated business opportunity associated with such jointly developed product.
The rest of the TC case is theoretically far from over, even with the court's dismissal of its fraud claims and the like, but is nonetheless likely dead in practical terms. It seems clear from the court's discussion that the fraud theory is far too nebulous to be sustained.
It takes a great deal of time and money to take a legal action to a point such as this and, a motion for preliminary injunction being, in effect, like a mini-trial, TC and FG have very spent somewhere in the six-figure range already to go through this exercise. Given that it is pretty clear that TC is chasing after windmills in terms of what it hopes to get out of this core dispute over breach of fiduciary duty concerning the product itself, it would seem that any further extension of the case case at this point would be more ego-driven anything else. One would hope that the parties would simply put it to rest with some private settlement made in light of the court's ruling.