The Supreme Court reversed the decision of the court of appeals that applied the doctrine of forfeiture as the basis for its reversal of the circuit court's vacatur of Loren Imhoff Homebuilder, Inc.'s arbitral award under Wis. Stat. 788.10(1), holding that remand was required.This case arose from a construction contract that Imhoff entered into with Homeowners for a remodeling project on Homeowners' home. Homeowners later asserted that Imhoff breach the construction contract. The parties proceeded to arbitration. Imhoff brought a motion to confirm the arbitral award. Homeowners moved to vacate the award based partly on the arbitrator's sleeping during arbitration, which Homeowners alleged was both misbehavior that resulted in prejudice and indicative of a flawed process. The Supreme Court reversed, holding (1) Homeowners did not forfeit their objection to the arbitrator's sleeping; and (2) because this Court is divided on whether the arbitration award should be vacated pursuant to Wis. Stat. 788.10, remand was required for consideration of section 788.10 issues. View "Loren Imhoff Homebuilder, Inc. v. Taylor" on Justia Law

The Supreme Court answered a question certified to the Supreme Court by the United States District Court for the District of Connecticut in this declaratory judgment action by holding that Defendant's plea of nolo contendere could not be used to trigger a criminal acts exclusion in a homeowners insurance policy governed by Connecticut law.At issue was whether Plaintiff, Allstate Insurance Company, could use Defendant's plea of nolo contendere to the charge of assault in the first degree to trigger a criminal acts exclusion that would bar Plaintiff's coverage of Defendant in a civil action involving the same underlying incident. The district court certified the question to the Supreme Court. The Supreme Court answered that Defendant's plea of nolo contendere could not be used by Plaintiff to establish the applicability of the criminal acts exclusion of the relevant policy. View "Allstate Insurance Co. v. Tenn" on Justia Law

The Supreme Court reversed the judgment of the district court ruling that Charlene Hassler had breached a court-modified agreement and granting summary judgment for Circle C Resources on its breach of a noncompete agreement claim, holding that the blue pencil rule is no longer permitted to make noncompete agreements reasonable.When she was hired by Circle C as a nursing assistant Hassler signed a noncompetition agreement prohibiting Hassler from soliciting Circle C's clients for twenty-four months after their employment relationship ended. After Hassler was hired by a new provider Circle C brought this action seeking damages for breach of the noncompete agreement. The district court granted summary judgment for Circle C, concluding that the noncompete agreement was reasonable enforceable if the geographical area subject to restriction were narrowed. The court then narrowed the restrictions accordingly. The Supreme Court reversed, holding (1) this Court no longer permits use of the blue pencil rule to make noncompete agreements reasonable; and (2) because the duration and geographical terms of the noncompete agreement were unreasonable the entire agreement was void in violation of public policy. View "Hassler v. Circle C Resources" on Justia Law

Sacks is a law firm with a 20-year history of working with the International Monetary Fund (IMF). In 2011, IMF hired Sacks to negotiate disputed claims of various contractors that worked on the renovation of its headquarters. The parties’ contract asserts IMF’s immunity from suit and provides that any disputes not settled by mutual agreement shall be resolved by arbitration. In a subsequent fee dispute between Sacks and IMF, Sacks filed a demand for arbitration with the AAA. The arbitration panel awarded Sacks $39,918.82 plus interest but denied Sacks’ claim of underpayment in connection with earlier work.Sacks sued the Fund, claiming that the award should be vacated pursuant to the D.C. Code as “the result of misconduct by the arbitrators.” IMF removed the case to federal court and moved to dismiss it on immunity grounds pursuant to its Articles of Agreement, given effect in the U.S. by the Bretton Woods Act, 22 U.S.C. 286h. Sacks asserted the contract waived immunity by expressly providing for arbitration pursuant to the AAA Rules, which contemplate courts’ entry of judgment on arbitral awards. The D.C. Circuit affirmed the dismissal of the suit. The AAA Rules and D.C. law contemplate judicial involvement in the enforcement of arbitral awards, so arguably the contract also does so but an international organization's waiver of the immunity must be explicit. The parties' contract expressly retains the IMF’s immunity, reiterating it even within the arbitration clause. View "Leonard A. Sacks & Associates P.C. v. International Monetary Fund" on Justia Law

The Supreme Court reversed the judgment of the district court concluding that an arbitration provision was void under Nev. Rev. Stat. 597.995 for failure to include a specific authorization, holding that the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq., preempted section 597.955, and therefore, the district court's decision was erroneous.Nev. Rev. Stat. 597.995 requires any agreement that includes an arbitration provision to include a specific authorization for that provision. The district court concluded that the arbitration provision at issue in this case was void for failure to include a specific authorization, as required by section 597.995. The Supreme Court reversed, holding (1) because section 597.995 singles out and disfavors arbitration provisions by imposing stricter requirements on them than on other contract provisions, the FAA preempts the statute in cases involving interstate commerce; and (2) the district court erred by concluding that section 597.995 voided the parties' arbitration agreement. View "Maide, LLC v. Dileo" on Justia Law

The Supreme Court reversed the circuit court's order reflecting a jury verdict awarding almost $6 million in compensatory damages, jointly and severally, against KBX, Inc. and three KBX individuals (collectively, Appellants) and other defendants and reversed the court's award of attorney's fees, holding that the court erred in part.In this case involving certain farmers' dispute with KBX, a grain exporter and merchandiser, and the KBX individuals over a series of written contracts for the purchase of rice, the circuit court entered a judgment reflecting the jury's award of compensatory damages against Appellants and other defendants. The court assessed attorney's fees and costs against Appellants as a sanction for alleged spoliation of evidence. The Supreme Court reversed in part, holding (1) without any evidence of deceit in the form of a false representation by KBX or the KBX individuals to the farmers, substantial evidence did not support the jury's verdict on deceit; (2) substantial evidence did not support the jury's verdict on constructive fraud or the farmers' conspiracy claim; (3) the circuit court erred as a matter of law in denying Appellants' motion for directed verdict on the farmers' unjust enrichment claim; and (4) remand was required on the issue of attorney's fees for recalculation of an award consistent with this opinion. View "KBX, Inc. v. Zero Grade Farms" on Justia Law

The Supreme Court reversed the decision of the court of appeals reversing order of the circuit court denying the motion of Legacy Health Services, Inc. Cambridge Place Group, LLC, and Cambridge Place Properties, LLC (collectively, Defendants) to dismiss or stay this lawsuit and compel arbitration of the medical malpractice claims brought by Christopher Jackson, as guardian for Christine Jackson, his mother, holding the court of appeals erred.At issue was whether Christopher possessed the authority, as his mother's guardian, to enter a voluntary arbitration agreement that was not a prerequisite to the provision of care or services to his ward. The circuit court concluded that Christopher did not have that authority. The court of appeals reversed, holding that a guardian's authority to enter into contracts generally is within the ambit of what is reasonably inferable from the relevant statutes. The Supreme Court reversed, holding (1) guardians have the authority to bind their wards to contracts that limit or deprive the civil rights of their wards only to the extent necessary to provide needed care and services to the ward; and (2) because the arbitration agreement was not necessary to provide care or services to Christine, Christopher lacked the authority to enter into the arbitration agreement. View "Jackson v. Legacy Health Services, Inc." on Justia Law

In 2012, the Moores sued, claiming that Equitrans breached the parties’ right-of-way agreement and trespassed on the Moores’ land by laying two pipeline segments outside of the area specified in their agreement. A jury found that Equitrans either trespassed on the Moores’ West Virginia property or violated the right-of-way agreement but made no findings as to the proper remedy. While the Moores initially sought equitable relief (ejectment), a subsequent condemnation judgment in favor of Equitrans ultimately precluded such relief. Following several appeals, the district court allowed the Moores to pursue damages for breach-of-contract and trespass but denied leave to add a claim for intentional trespass. Later, the district court barred any claim for breach-of-contract damages. After excluding much of the Moores’ evidence of trespass damages, the court sua sponte entered judgment in favor of Equitrans.The Fourth Circuit vacated in part. The district court did not abuse its discretion in denying leave to amend, in making its motion in limine rulings, or in entering judgment in favor of Equitrans on contract damages. The court rejected a contention that the proper measure of trespass damages includes a portion of Equitrans’s profits. Because the Moores lacked sufficient notice that they needed to come forward with all evidence of trespass damages, the court vacated the portion of the judgment concerning trespass damages for procedural error and remanded. View "Moore v. Equitrans, L.P." on Justia Law

Labor unions and the West Virginia Pipe Trades Health and Welfare Fund, sued Nitro Construction under the Labor Management Relations Act (LMRA), 29 U.S.C. 185, after Nitro made several tardy payments to the Fund. Nitro had paid its required contribution before the suit was filed; the suit sought $77,373.95 in liquidated damages, plus interest and attorneys’ fees, as provided for by the collection procedures.The district court granted Nitro summary judgment, holding that the liquidated damages constituted penalties and were therefore unrecoverable. The Fourth Circuit affirmed. Although ERISA allows punitive liquidated damages, federal common law prohibits punitive damages for breach of contract. The federal common law to be applied in LMRA Section 301 cases is ordinarily the general law of contracts. The court noted that the Fund sought almost $80,000 in liquidated damages, even though its actual damages (lost interest) are readily ascertainable and were only $3,952. Nitro’s late payments did not result in any claim being denied. Nitro never agreed to the liquidated damages provisions; the Fund unilaterally created its delinquent employer procedures under its governing document. The district court did not err by finding these liquidated damages provisions to be punitive and declining to enforce them. View "Plumbers & Pipefitters Local 625 v. Nitro Construction Services, Inc." on Justia Law

Boor and Edson owned Brava, which had intellectual property and technical knowledge related to composite roofing. Wildhawk inquired about purchasing Brava. Boor proposed “an exclusive license for manufacturing current roofing products” with “a right of first refusal on all new product [d]evelopments.” The parties executed asset purchase and license agreements. Wildhawk paid $4 million and obtained an automatic license to “any Improvements” to the technology, whether patentable or not. Before executing the agreement, the parties removed a “New Product” section as required by Wildhawk’s lender but entered into an oral agreement for a right of first refusal. Wildhawk retained Boor and Edson as paid consultants, with non-compete agreements.Boor notified Wildhawk: “As per our handshake agreement” we offer you first right of refusal “on the below products.” The parties entered into a confidentiality and nondisclosure agreement regarding “possible R&D ‘new or enhanced product’ agreements.” They negotiated but failed to reach an agreement. Boor and Edson formed Paragon while Boor was still employed by Wildhawk. Paragon began producing the new products.Wildhawk sued. The district court granted Wildhawk a preliminary injunction, prohibiting Paragon from manufacturing or selling composite roofing. The Eighth Circuit vacated. Wildhawk had a fair chance of proving the defendants violated the agreement but the district court erred in rejecting an equitable estoppel defense. Wildhawk waited until Paragon had been producing the products for 10 months before making its claim, failing to show either reasonable diligence or harm that cannot be compensated by damages. View "Wildhawk Investments, LLC v. Brava I.P., LLC" on Justia Law