Justia Contracts Opinion Summaries

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Plaintiffs, writers and producers who entered into a profit participation agreement with Walt Disney Pictures regarding their work on the television series, Home Improvement, filed suit alleging that Disney failed to properly account for and pay them the amounts owed under the parties' agreement. The trial court granted Disney's motion for summary adjudication, finding that the claims were time-barred by the contractual limitations period in the incontestability clause. The court concluded that plaintiffs' claims were within the scope of the incontestability clause in the parties' profit participation agreement; Disney met its burden of showing that the 24-month limitations period in the parties' agreement expired prior to the producers objecting to the participation statements; plaintiffs waived the discovery rule by agreeing to the incontestability clause; and, based on the totality of the evidence about Disney's alleged conduct, there were triable issues of fact as to whether Disney waived or was estopped from asserting a contractual limitations defense. Accordingly, the court reversed the judgment. View "Wind Dancer Production Group v. Walt Disney Pictures" on Justia Law

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Plaintiff Muhammad Iqbal appealed the grant of summary judgment entered against his complaint for personal injuries. In 2011, plaintiff sued Yosemite Auto Sales, Inc. (Yosemite Auto), its owner Eyad Kaid, and Alla Abuziadeh, individually and doing business as Jimmy’s Tow (collectively, the former defendants), for personal injuries. He alleged Yosemite Auto retained him to determine why a vehicle it owned would not start. Unknown to plaintiff, Abuziadeh earlier towed the vehicle to Yosemite Auto and disconnected the transmission shift linkage to do so. He allegedly did not reconnect the shift linkage after towing the car. The trial court ruled the complaint was barred by a general release plaintiff had previously executed that immunized “affiliates” of the defendants in the former case, and defendant Imran Ziadeh was such an affiliate. The Court of Appeal concluded as a matter of law defendant was not a protected “affiliate,” as that term was commonly understood, and reversed. View "Iqbal v. Ziadeh" on Justia Law

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Hanzada, an Egyptian company that imports and exports beef, appealed the jury verdict and judgment against it on plaintiff's breach of contract claim. The district court relied on the Seventh Circuit's widely adopted Sadat v. Mertes rule that only the American nationality of the dual citizen should be recognized for purposes of 28 U.S.C. 1332(a). The court concluded that the district court properly found diversity jurisdiction because plaintiff was a U.S. citizen and his Egyptian citizenship did not defeat jurisdiction. The court also concluded that the district court properly exercised personal jurisdiction over Hanzada where there was sufficient minimum contacts with Missouri for the Missouri long-arm statute to authorize personal jurisdiction. Finally, the district court properly found the statute of frauds inapplicable in this case where, under Missouri law, an oral contract for an indefinite period of time does not violate the statute of frauds. Accordingly, the court affirmed the judgment. View "Aly v. Hanzada for Import & Export Co." on Justia Law

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Farrar was hired by Direct Commerce as its vice-president of business development and negotiated an employment agreement set forth in a six-page offer letter detailing her compensation, additional bonus structure, and stock options. The agreement also included an arbitration provision, set off by the same kind of underlined heading and spacing as the other enumerated paragraphs of the agreement. When Farrar sued Direct, alleging breach of contract, conversion, wrongful termination, breach of the covenant of good faith and fair dealing, and failure to pay wages owed and waiting time penalties, the employer unsuccessfully sought to compel arbitration. The trial court found the arbitration provision procedurally and substantively unconscionable. The court of appeals reversed. While the arbitration provision is one-sided, as it excludes any claims arising from the confidentiality agreement Farrar also signed, that offending exception is readily severable and, on this record, should have been severed. View "Farrar v. Direct Commerce, Inc." on Justia Law

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Contractor and Homeowner entered into an agreement whereby Contractor agreed to furnish materials and supply labor in connection with renovations to Homeowner’s residence. After the renovation project was largely complete, the parties began to dispute the amounts that Homeowner owed Contractor. Contractor then brought this action claiming, inter alia, breach of contract and unjust enrichment. Homeowner raised the special defense that Contractor’s claims were barred because the agreement did not comply with the Home Improvement Act. In response, Contractor argued that Homeowner was precluded from relying on the Act because his refusal to pay Contractor was in bad faith. The trial court agreed with Contractor and rendered judgment for Contractor. The Appellate Court affirmed. The Supreme Court reversed, holding that Homeowner did not act in bad faith, and therefore, the trial court improperly found that Homeowner was barred from invoking the protection of the Act. Remanded with direction to render judgment for Homeowner. View "Burns v. Adler" on Justia Law

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Ariz. Rev. Stat. 12-341.01(A) provides that if a party makes a written settlement offer that is rejected, and the final judgment is more favorable to the offering party, that party “is deemed to be the successful party from the date of the offer.” American Power Products (American) and CSK Auto (CSK) entered into a contract that provided that, in the event of an action arising out of the contract, “the prevailing party shall be entitled to recover…reasonable attorneys’ fees.” American later sued CSK for breach of contract. Before trial, CSK served American with an offer of judgment in the amount of $1,000,001. American did not accept the offer and obtained a jury verdict in the amount of $10,733. The trial court concluded that American was the “prevailing party” at trial and awarded American attorney fees. The court of appeals affirmed the fee award. The Supreme Court reversed, holding (1) because the contract did not define “prevailing party” but did incorporate Arizona law to determine the parties’ rights and remedies, the statute applied for the purpose of determining the successful party; and (2) the trial court correctly determined that American was the prevailing party before CSK’s offer of judgment but erred in ruling that American was the prevailing party after CSK’s settlement offer. View "American Power Products Inc. v. CSK Auto, Inc." on Justia Law

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Peachtree filed suit against Rapid for tortious interference with its contracts. Peachtree and Rapid are two companies in the business of identifying individuals who are the beneficiaries of structured settlements, which provide a stream of payments, much like an annuity, usually over an extended period of years; once an annuitant is identified, the companies offer to purchase the stream of payments in return for a lump sum. The district court dismissed the claims and both parties appealed. The court held that plaintiffs failed to meet their burden of establishing either federal question or federal diversity jurisdiction. Therefore, federal courts have no subject matter jurisdiction over this case. The court vacated and remanded with directions to remand the case to state court. View "Settlement Funding, LLC v. Rapid Settlements" on Justia Law

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Plaintiffs, a class of retirees and their union, filed suit against Constellium after the company unilaterally altered its retiree health benefits program. The district court granted summary judgment to Constellium. The court interpreted Article 15 of the collective bargaining agreement (CBA) using ordinary contract principles and concluded that the plain language of the CBA and summary plan description (SPD) clearly indicated that the retiree health benefits did not vest. The court rejected plaintiffs' assertion that the Cap Letters and other provisions of the CBA evince an intent to vest the retiree health benefits. The court also rejected plaintiffs' remaining claims and affirmed the judgment. View "Barton v. Constellium Rolled Products-Ravenwood, LLC" on Justia Law

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In August 2012, Aliments, a Canadian snack purveyor, contacted its American broker, Sterling, to purchase thousands of pounds of raw pistachios. Sterling contacted Pacific, another broker, which called Nichols, a California pistachio grower, who agreed to the proposed quantity and price. In September, Sterling contacted Pacific with another order from Aliments. Pacific contracted with Nichols again. Sterling sent sales confirmations to Aliments and Pacific. Pacific did not forward the Sterling sales confirmations to Nichols but issued its own confirmations to Nichols and Sterling. Neither Aliments nor Nichols was aware that two confirmations existed, with the same terms, including a 30-day credit term. However, while Sterling’s confirmations contained arbitration clauses, not all of the confirmations generated by Pacific contained arbitration clauses. Aliments believed that the Sterling confirmations, though unsigned by either party, represented binding contracts to purchase pistachios from Nichols, with payment due 30 days from delivery, “as usual.” Nichols thought that the 30-day term was but a placeholder. The parties were unable to agree to payment terms. Despite being notified of an arbitration, Nichols did not attend. Aliments was awarded $222,100 in damages. Nichols refused to pay. The district court denied Aliments’ petition to enforce the award and granted Nichols’s cross-petition to vacate because no genuine issue of material fact existed as to whether the parties failed to enter into “an express unequivocal agreement” to arbitrate. The Third Circuit vacated, finding multiple issues of fact. View "Aliments Krispy Kernels Inc v. Nichols Farms" on Justia Law

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Omega filed suit against Mayo, alleging claims of fraud, negligent misrepresentation, breach of contract, and breach of the implied covenant of good faith and fair dealing. The parties had entered into an Exclusive Patent License Agreement in which Omega, a start-up company, agreed to, among other things, pursue Mayo's pending patent application. After the patent application was abandoned when the U.S. Patent and Trademark Office denied an elected group of claims as anticipated by prior art, Omega alleged damages because it relied on Mayo's pre-Agreement false representations. The court concluded that the Agreement and the patent application file squarely contradict Omega's general, conclusory allegation of reasonable reliance. Therefore, the district court properly dismissed these claims grounded in fraud for failure to state plausible claims of reasonable reliance. Accordingly, the court affirmed the judgment. View "OmegaGenesis Corp. v. Mayo Foundation" on Justia Law