Justia Contracts Opinion Summaries

In the case brought before the Court of Chancery of the State of Delaware, Texas Pacific Land Corporation (the "Company") sued Horizon Kinetics LLC, Horizon Kinetics Asset Management LLC, SoftVest Advisors, LLC, and SoftVest, L.P. (collectively, the "Investor Group") over a dispute related to a stockholder vote. The Company alleged that the Investor Group breached a contractual obligation under a stockholders agreement to vote their shares in accordance with the board of directors' recommendation. The recommendation was for a charter amendment to increase the Company’s authorized shares. The Investor Group voted against the amendment, arguing they were not bound to follow the board’s recommendation due to exceptions in the agreement. They also claimed the doctrine of unclean hands barred the Company from enforcing the voting commitment, arguing the Company had disclosed inaccurate information when soliciting stockholder approval. The court found the Investor Group breached the voting commitment and their shares should be deemed to have voted in favor of the amendment. Consequently, the amendment was declared to have been approved. The court dismissed the Investor Group's unclean hands argument, citing their own misconduct in violating the agreement. View "Texas Pacific Land Corporation v. Horizon Kinetics LLC, et al." on Justia Law

In this case, Eli Global, LLC, and Greg Lindberg appealed a summary judgment entered against them by the Mobile Circuit Court in Alabama. The dispute involved Eli Global's alleged failure to fulfill its obligations on a promissory note and Lindberg's alleged failure to fulfill his obligations on a guaranty of that promissory note. The promissory note and guaranty were part of an agreement to purchase a healthcare company. Eli Global and Lindberg also challenged the circuit court's award of attorney fees and expenses to the plaintiffs.The Supreme Court of Alabama affirmed the lower court's judgment finding Eli Global and Lindberg liable based on the promissory note and the guaranty, and its award of the principal amount plus interest due based on that liability. The court found that the promissory note was not a negotiable instrument under New York law, and even if it was, the plaintiffs were not required to prove who possessed the promissory note because Eli Global and Lindberg waived that argument in the lower court. In addition, the court found that one of the plaintiffs did not release his claims against Lindberg that were based on the guaranty.However, the court remanded the case back to the lower court to provide a more detailed explanation for the award of attorney fees and expenses. The court found that the lower court's order did not provide sufficient explanation on how it determined the award of attorney fees and expenses. The lower court was instructed to return its explanation to the Supreme Court within 42 days. View "Eli Global, LLC v. Cieutat" on Justia Law

In the underlying breach of contract action the Supreme Court affirmed the orders of the district court denying Appellants relief under Nev. R. Civ. P. 60(b)(1), Nev. R. Civ. P. 60(b)(5) and Nev. R. Civ. P. 60(b)(6) after the district court granted Respondents' motion for sanctions and dismissed the case with prejudice, holding that there was no error.Appellants sued Respondents on claims sounding in breach of contract. After three years of Appellants failed to comply with various discovery requirements and court orders Respondents moved for sanctions seeking dismissal with prejudice. The district court granted the motion. Appellants moved to set aside the sanctions order, and the district court denied relief. The Supreme Court affirmed, holding (1) as to the denial of Appellants' Nev. R. Civ. P. 60(b)(1) motion, the district court's decision was supported by substantial evidence; (2) as to the denial of Appellants' Nev. R. Civ. P. 60(b)(5) motion, this rule was not an appropriate vehicle by which Appellants could obtain relief; and (3) as to the denial of Appellants' Nev. R. Civ. P. 60(b)(6) motion, the district court did not abuse its discretion. View "Willard v. Berry-Hinckley Industries" on Justia Law

In 2016 Watchous Enterprises, LLC contracted with one of the five individual defendant companies, Pacific National Capital, paying it a $7,600 nonrefundable deposit to secure help finding a lender or a joint-venture partner. Pacific introduced Watchous to companies affiliated with Waterfall Mountain LLC (collectively referred to as "Waterfall"). Watchous and Waterfall eventually executed a letter of intent to enter into a joint venture to which Waterfall would contribute more than $80 million. As part of the arrangement, Watchous paid Waterfall a $175,000 refundable deposit. Waterfall said that it would fund the venture through proceeds of loans backed by billions of dollars in Venezuelan sovereign bonds in the name of Waterfall or its lender (RPB Company). But Waterfall never funded Watchous, and Watchous was never refunded the $175,000. Watchous then filed suit under the federal Racketeer Influenced and Corrupt Organizations Act (RICO) and common-law claims under Kansas law against Pacific and Waterfall as well as against the five Appellants sued individually. The district court granted partial summary judgment in favor of Watchous on its fraud claims (leaving damages for the jury to decide), essentially on the ground that Appellants misrepresented and failed to disclose “the historic and contemporary facts about Waterfall’s dubious finances, loan defaults, and consistent lack of success in funding similar projects.” Watchous’s remaining claims proceeded to trial, where a jury found that Appellants engaged in a civil conspiracy to defraud Watchous, and had violated RICO. Appellants appealed, but finding no reversible error, the Tenth Circuit affirmed. View "Watchous Enterprises v. Mournes, et al." on Justia Law

Plaintiff Team Industrial Services, Inc. (Team) suffered a $222 million judgment against it in a wrongful-death lawsuit arising out of a steam-turbine failure in June 2018 at a Westar Energy, Inc. (Westar) power plant. Team sought liability coverage from Westar, Zurich American Insurance Company (Zurich), and two other insurance companies, arguing that it was, or should have been, provided protection by Westar’s Owner-Controlled Insurance Program (OCIP) through insurance policies issued by Zurich and the two other insurers. Team’s claims derived from the fact that its liability for the failure at the Westar power plant arose from work that had previously been performed by Furmanite America, Inc. (Furmanite), which had coverage under Westar’s OCIP. The district court granted summary judgment to Defendants, and Team appealed. Not persuaded by Team's arguments for reversal, the Tenth Circuit affirmed the district court. View "Team Industrial Services v. Zurich American Insurance Company, et al." on Justia Law

At a coffee shop in Calabasas, David Delrahim made Edwart Der Rostamian a business proposal. Rostamian got his notebook, asked a server for a pen, and worked with Delrahim to compose two pages of text. When they were done, each man signed the paper. Rostamian later sued Delrahim on contract claims. The trial court granted Delrahim’s motion for summary judgment, ruling the Calabasas writing was too indefinite to be a contract.   The Second Appellate District affirmed the order dismissing the tortious interference causes of action. The court reversed as to the breach of contract, specific performance, and unfair business practices causes of action. The court explained that before Rostamian and Delrahim wrote and signed the Writing, their discussions were freewheeling and wide-ranging. Rostamian was “under contract” and in escrow with Mekhail, so one possible form of the deal would be to complete the escrow and thus to make Rostamian the intermediate buyer, who then would sell to Delrahim, who would become the ultimate buyer. Another possibility was for Delrahim to “replace” Rostamian in the escrow, thus again making Delrahim the ultimate buyer. Or Delrahim could become Rostamian’s partner, or he could become an investor in the deal. The two men were canvassing possibilities before they reached an agreement and drafted the Writing. In the portion of the declaration the trial court cited, Rostamian explained that the Writing set out Delrahim’s promise to allow Rostamian to own the four dealer sites. Rostamian’s deposition answer did not contradict Rostamian’s declaration. View "Tiffany Builders, LLC v. Delrahim" on Justia Law

Ann Hon and Herman Yee worked together in Hon’s company, but they sued each other when their relationship ended. Their litigation turned up a lien on one of their homes—a lien in favor of a long-suspended corporation called Panrox International (USA), Inc. A third-party attorney heard about the lien, revived Panrox, and entered the litigation between Hon and Yee, claiming Hon and Yee owed Panrox $141,000 from a 1995 debt. Hon and Yee said their debt to Panrox was resolved in 1999. In 2022, the trial court ruled for Hon and Yee. Panrox appealed.   The Second Appellate District affirmed. The court explained that Panrox’s first claim of error is that the trial court erroneously shifted the burden of proof to Panrox by ordering it to file a motion demonstrating the validity of its Los Angeles deed of trust. Panrox forfeited this objection by failing to raise it in the trial court. Had Panrox made this objection, the trial court could have addressed the issue and, if need be, rectified the problem on the spot. It is detrimental for parties to store up secret objections they deploy only if they lose and, after much cost and delay, appeal. Similarly, Panrox, in a footnote, complained the trial court never afforded it the opportunity “to present a summary judgment motion or some other procedural vehicle that would have properly shifted the burden of proof to Respondents Hon and Yee after Panrox made its initial showing.” The court explained that Panrox forfeited this argument by failing to present it to the trial court. View "Yee v. Panrox Internat. (USA), Inc." on Justia Law

The First Circuit affirmed the judgment of the district court dismissing all breach of contract claims brought by Universal Trade-in & Investment Company (UTICo) against Ukraine, the Ukrainian Prosecutor General's Office (UPGO), and the Bureau for Representing Ukrainian Interests in International and Foreign Courts, and denying UTICo's motions to amend the complaint and several of its discovery-related requests, holding that there was no error.UTICo, which was instrumental in helping the defendants investigate and freeze millions of dollars of worldwide assets that had been expatriated from Ukraine, alleged, among other things, that the defendants breached their contractual duties. The district court dismissed the breach of contract claims and entered judgment in favor of the Ukrainian defendants. The First Circuit affirmed, holding that the district court (1) did not err in granting summary judgment on the portion of the breach of contract claim related to Swiss assets that were transferred to the Ukrainian treasury; and (2) did not err in denying UTICo's three motions to amend. View "Universal Trading & Investment Co. v. Bureau for Representing Ukrainian Interests" on Justia Law

The Court of Chancery denied Sunder Pros LLC's application for a preliminary injunction against Tyler Jackson because Sunder could not establish a reasonable likelihood of success on the merits and further denied Sunder's application for a preliminary injunction against the remaining defendants for lack of an underlying breach of contract.Jackson, the former head of Sunder's sales who lived in Texas, joined Solar Pros, LLC and resigned from Sunder. Sunder, whose headquarters were in Utah but was a Delaware LLC, brought this suit arguing that Jackson was bound by restrictive covenants (the covenants). The Court of Chancery denied relief, holding (1) the covenants, which were facially unreasonable in their own right, were part of an agreement that could not be enforced against Jackson because the agreement originated in an egregious breach of fiduciary duty; and (2) as to the remaining Defendants, there was no underlying breach of contract, and Defendants did not engage in conduct that could support a claim for tortiously interfering with the covenants as required by Utah law. View "Sunder Energy, LLC v. Jackson" on Justia Law

Jeffrey Weikum appealed a district court order and judgment denying his motion to compel arbitration, and granting Rodney Pagel and Scott Hager's motion for summary judgment. The parties agreed to dissolve their law firm, Pagel Weikum, PLLP, and entered into a Release and Settlement Agreement. The Agreement included an arbitration clause. Pagel and Hager filed suit against Weikum for breach of contract and conversion. Weikum moved to dismiss and compel arbitration. The North Dakota Supreme Court reversed, finding the arbitration clause at issue in the Agreement was broad, and not limited by any exceptions. The Court concluded the district court misinterpreted the Agreement by finding the claims raised were not arbitrable, and by denying the motion to compel arbitration of those claims. View "Pagel, et al. v. Weikum" on Justia Law