Castle Properties, Inc. held a right of first refusal on approximately 2.4 acres of unimproved land owned by the Wasilla Lake Church of the Nazarene (Church). The City of Wasilla offered the Church another parcel of approximately 17 acres in exchange for this property. Having learned of the City’s offer, Castle requested a copy of the purchase and sale agreement memorializing the exchange. The Church, apparently unaware of the right of first refusal, denied this request. Castle then informed the Church that it was exercising its right and submitted a cash offer, which the Church rejected. Castle filed suit, and the superior court found that Castle received adequate notice when it obtained the city ordinance approving the City’s offer and that the Church acted reasonably in rejecting Castle Properties’ competing cash offer. After review, the Supreme Court concluded that the superior court did not clearly err in finding that Castle received adequate notice, that Castle exercised its rights by making a competing offer, and that the Church’s response did not violate the covenant of good faith and fair dealing. View "Castle Properties, Inc. v. Wasilla Lake Church of the Nazarene" on Justia Law

Customers of a securities firm made claims against that firm based on real estate investments the firm’s broker-dealers recommended. An entity that had an interest in and operated each of the real estate investments filed for bankruptcy, and at least some of the real estate investments became debtors in that bankruptcy proceeding. The appointed examiner in the bankruptcy proceeding found that the entity was engaged in a fraudulent “Ponzi scheme.” When the securities firm applied for professional liability insurance, it disclosed one of the customer claims but not the facts that would support other potential customer claims arising out of investments through the same entity as that involved in the disclosed claim. The insurer refused to defend against undisclosed claims because the policy’s application included an exclusion for nondisclosure of facts that might lead to a claim. The court of appeal affirmed judgment in favor of the insurer: There was no insurance coverage because all of the undisclosed claims arose out of the same events as the disclosed claim. The securities firm was aware of facts and circumstances that might result in a claim or claims being made against it, which awareness it was required to disclose. View "Crown Capital Secs., L.P. v. Endurance Am. Specialty Ins. Co." on Justia Law

In this putative nationwide class action Plaintiffs claimed that they were deceived into purchasing Defendants’ “natural” cosmetics, which contained allegedly synthetic and artificial ingredients. Plaintiffs sought injunctive relief and damages under the federal Magnuson-Moss Warranty Act, California’s unfair competition and false advertising laws, and common law theories of fraud and quasi-contract. The district court dismissed the quasi-contract cause of action for failure to state a claim and dismissed the state law claims under the primary jurisdiction doctrine so that the parties could seek expert guidance from the Food and Drug Administration (FDA). A panel of the Ninth Circuit reversed, holding (1) the Food, Drug, and Cosmetic Act does not expressly preempt California’s state law causes of action that create consumer remedies for false or misleading cosmetics labels; (2) although the district court properly invoked the primary jurisdiction doctrine, it erred by dismissing the case rather than staying proceedings while the parties sought guidance from the FDA; and (3) the district court erred in dismissing the quasi-contract cause of action as duplicative of or superfluous to Plaintiffs’ other claims. View "Astiana v. Hain Celestial Group, Inc." on Justia Law

Tenant was the successor lessee to a thirty-year lease on a commercial property in Brattleboro. The lease was executed in 1987. The lease established a basic annual rent of $26,500 in paragraph 8, and then set forth how the rent would increase in subsequent years. Pursuant to the rent-increase provision, each year landlords calculated the annual rent increase and sent a notice to tenant. The increase was calculated as the percentage change in the CPI from the previous year to the current year multiplied by the previous year's rent. This increase was then added to the prior year's rent to arrive at the new annual rent. In March 2007, tenant assumed the lease. From 2008 to 2012, landlords sent rent-increase notices and tenant paid rent annually adjusted for increases, calculated according to this method, without objection. In 2013, landlords sent the annual rent increase notice to tenants. The notice reflected the new 2013 rent as $54,060. Tenant objected to the amount of rent and the calculation method for rental increases. The parties were unable to resolve their dispute, and tenant filed an action seeking both a declaration that its interpretation of the lease language was correct and damages for overpaid rent. Tenant appealed the court's order granting summary judgment in favor of defendant landlords on the parties' dispute concerning a rental-increase provision of the lease. Tenant argued on appeal that the court erred in using extrinsic evidence to interpret a portion of the lease tenant believed was unambiguous, and in reaching an inequitable result. Finding no reversible error, the Supreme Court affirmed. View "B&C Management Vermont, Inc. v. John, Ringey & Beck" on Justia Law

Ram’s Gate bought Sonoma County property from the Roches, intending to build a winery. The sellers agreed in the Purchase Agreement to disclose facts having a “material effect on the value of the ownership or use,” including geological hazards. After escrow closed, Ram’s Gate discovered an active fault trace on the property that substantially increased the cost of development, and sued the Roches for breach of contract. The trial court granted summary adjudication, finding the Purchase Agreement warranties merged with the recording of the deed and did not survive the closing. The court of appeal reversed. The trial court relied on the wrong legal standard in determining that merger extinguished the contractual duty to disclose geotechnical reports allegedly known by the Roches; evidence from Ram’s Gate’s representative raised a triable issue of fact as to whether the parties intended to have this duty of disclosure merge with the deed. Ram’s Gate’s claim for breach of contract accrued at the time of the breach; the Roches’ liability for breach was fixed before escrow closed, even though Ram’s Gate was unaware of its right to sue. Even if merger applied, the collateral obligations exception prevented it from extinguishing the disclosure duty. View "Ram's Gate Winery, LLC v. Roche" on Justia Law

Plaintiff, a mineral owner, sued Defendant alleging breach of contract, failure to pay royalties, and fraud. The claims centered on three oil and gas leases that Plaintiff, the lessor, executed with Defendant, the lessee. Plaintiff prevailed on the majority of his claims in the trial court. As relevant to this appeal, the jury determined that Plaintiff, in the exercise of reasonable diligence, discovered the fraud less than four years before filing suit. The trial court therefore concluded that the claims were not time barred. The court of appeals reversed, concluding that the fraud should have been discovered, as a matter of law, more than four years before Plaintiff filed suit because Plaintiff should have discovered the relevant information in the Texas Railroad Commission’s public records. The Supreme Court reversed, holding that Plaintiff’s reasonable diligence in discovering the underlying fraud was a question of fact for the jury. Remanded. View "Hooks v. Samson Lone Star, Ltd. P’ship" on Justia Law

Plaintiff, a physician, filed an employment discrimination action against the California Emergency Physicians Medical Group (CEP) in state court. CEP removed the suit to federal court. Prior to trial, the parties agreed in writing to settle the case. The settlement agreement included a provision that Plaintiff waive his rights to employment with CEP or at any facility that CEP may own or with which it may contract in the future. Plaintiff refused to execute the written agreement and attempted to have it set aside. The district court ultimately ordered that the settlement be enforced and dismissed the case, concluding that Cal. Bus. & Prof. Code 16600, which provides that a contract is void if it restrains anyone from engaging in a lawful profession, did not apply because the no-employment provision in the settlement agreement did not constitute a covenant not to compete. A panel of the Ninth Circuit reversed, holding (1) the parties’ dispute regarding whether the no-employment provision voided the settlement agreement was ripe for review under the traditional ripeness standard; and (2) the district court abused its discretion by categorically excluding the settlement agreement from the ambit of 16600 solely on the ground that it did not constitute a covenant not to compete. Remanded. View "Golden v. Cal. Emergency Physicians Med. Group" on Justia Law

A law firm (Plaintiff) filed a quantum merit claim for part of the contingent fees earned in cases that were first handled by the law firm’s attorneys, including Defendant, and later by Defendant and his law firm after he left Plaintiff’s law firm. The trial court denied quantum merit relief, finding that Defendant was not unjustly enriched. The court of appeals affirmed. The Supreme Court granted transfer and (1) reversed and remanded with instructions to determine, in accordance with Galanis v. Lyons & Truitt, what proportional contributions toward the results in the cases at issue were made by attorneys working for Plaintiff, and to enter a corresponding judgment in Plaintiff’s favor; and (2) summarily affirmed the portion of the court of appeals’ opinion addressing whether Plaintiff should have sued its former clients to recover attorney fees from them. View "Cohen & Malad, LLP v. Daly" on Justia Law

This arbitration case stemmed from disputes over Appellee Organizational Strategies, Inc.'s (OSI) captive insurance program, created with Appellants Capstone Insurance Management, Ltd., Capstone Associated Services, and Capstone Associated Services (Wyoming), LP's (collectively, "Capstone") assistance. Appellant PoolRe, managed by Capstone, provided insurance services to OSI's newly created captive insurance companies. Capstone and OSI entered into contracts requiring AAA arbitration, whereas PoolRe and the captive insurance companies entered into contracts requiring ICC arbitration. An arbitrator joined all of the parties for arbitration under AAA rules. Because the arbitrator acted contrary to the express provisions of the PoolRe arbitration agreements, the district court held that arbitrator exceeded his authority and, pursuant to 9 U.S.C. 10, vacated the award. Finding no reversible error, the Fifth Circuit affirmed. View "PoolRe Insurance Corp. v. Organizational Strategies, Inc." on Justia Law

In 1998, Glenn Johnson suffered serious work-related injuries. In separate administrative proceedings, the parties contested the details and amounts of the lifetime workers’ compensation benefits Johnson was entitled to. Johnson and his wife filed the instant suit against his employer’s workers’ compensation insurance provider and related individuals and entities (collectively, Crawford), alleging that Crawford engaged in a plan to delay and deny benefits that the Johnsons were entitled to receive. Crawford filed a plea to the jurisdiction and motion for summary judgment, arguing that the Texas Department of Insurance Division of Workers’ Compensation had exclusive jurisdiction over all of the Johnsons’ claims because they arose out of the workers’ compensation claims-handling process. The trial court dismissed the Johnsons’ claims for breach of the common law duty of good faith and fair dealing and for violations of the Texas Insurance Code but refused to dismiss any of the other claims. The Supreme Court conditionally granted mandamus relief, holding that all of the Johnsons’ claims arose out of Crawford’s investigation, handling, and settling of claims for workers’ compensation benefits, and therefore, the Division had exclusive jurisdiction over the Johnsons’ claims. View "In re Crawford & Co." on Justia Law