LIHU'E, Kaua'i — State Judge George Masuoka yesterday affirmed his January order removing prominent Honolulu attorney Daniel Case as a defendant in a lawsuit brought by a group of former Grove Farm Co. stockholders.

The stockholders are challenging the sale of the company to Case's son, Steve Case.

Attorneys John McDermott, Matthew Simmons and Richard E. Wilson, on behalf of the suing stockholders, asked Masuoka to reconsider his earlier ruling granting a motion for summary judgment, which let Dan Case out of the legal action.

After hearing arguments, Masuoka yesterday denied the motion to reconsider his summary judgment decision.

McDermott and Simmons argued that Dan Case had multiple, serious conflicts of interest in the sale of Grove Farm, since Case and his law firm represented both the buyer and seller during most of the discussions leading to the sale of Grove Farm to Dan Case's son.

Wilson said that although Grove Farm's board of directors waived the conflict of interest issue, the conflict was so significant as to be unwaiveable.

Attorney Gary Grimmer, representing Dan Case, argued that the plaintiffs were impermissibly bringing up issues that were not raised when the original motion for summary judgment was argued. Grimmer also said the plaintiffs represent a minority of Grove Farm's original stockholders, suggesting that a majority remain in support of the sale.

Steve Case made a fortune turning AOL into a major Internet company and then merging it with Time Warner.

His family had a long connection to Grove Farm, where his grandfather was a financial officer for many years. Dan Case was born while the family lived on Kaua'i at Grove Farm, then a sugar company.

The firm has 22,000 acres of Kaua'i land.

While Dan Case appears to be out of this legal action, he remains a plaintiff in a second lawsuit brought by some of the same stockholders and some different ones.

That case also argues the company was improperly sold. The essence of the complaints is that Grove Farm was sold for less than it was worth, and that company officials failed to inform stockholders about the actual value and about other suitors who were willing to pay more for Grove Farm than Steve Case was offering.

Case paid $26 million for the company and assumed roughly $60 million in debt.

Reach Jan TenBruggencate at jant@honoluluadvertiser.com.