Justia Contracts Opinion Summaries

FEI, Crop Venture's successor-in-interest, filed suit alleging that the individual defendants took proprietary information they developed at Crop Ventures after they left the company and co-founded Farmobile (the corporate defendant). Specifically, FEI alleges that the individual defendants' behavior constituted a breach of explicit or implicit contracts with the company; defendants were obligated to assign to their employer the ownership rights of products they worked to develop; the individual defendants breached their duty of loyalty to their employer; and the individual defendants misappropriated trade secrets. The district court denied in full FEI's motion, and granted in part and denied in part Farmobile's motion.The Eighth Circuit affirmed and held that because no contract bound the parties during Defendant Nuss' term of employment, Nuss was not in breach of an explicit contract; FEI has not shown that any of the individual defendants was similarly "specifically directed" during their product-development process, so no implied contracts were created under the hired-to-invent doctrine; FEI failed to show the individual defendants breached their duty of loyalty to their employer; FEI cannot maintain a trade secret claim under the Nebraska Trade Secrets Act (NTSA) or the federal Defend Trade Secrets Act (DTSA); and the remaining claims are unpersuasive. View "Farmers Edge Inc. v. Farmobile, LLC" on Justia Law

The Supreme Court modified and affirmed the decision of the Business Court dismissing Defendant's crossclaims against a co-defendant, holding that the Business Court correctly dismissed the crossclaims.This appeal arose from litigation between Kenneth Nelson, Alliance Hospitality Management, LLC, and Orlando Residence, Ltd. Orlando filed this lawsuit against Alliance and Nelson seeking recovery of funds that Alliance allegedly wrongfully transferred. Nelson, appearing pro se, filed a document in which he asserted eighteen crossclaims against Alliance seeking damages and various forms of equitable relief. The Business Court dismissed the claims asserted by Orlando and all of Nelson's crossclaims. Nelson appealed, arguing that the Business Court incorrectly ruled that a crossclaim asserted by one defendant against a co-defendant automatically ceases to be viable once the plaintiff's original claims against the defendants are dismissed. The Supreme Court agreed, holding (1) with the exception of certain crossclaims, the dismissal of the original action does not, by itself, mandate the dismissal of a crossclaim so long as the crossclaim meets the Rule 13(g) prerequisites for bringing such a claim; and (2) because res judicata barred Nelson's "qualifying claims," the dismissal of Nelson's remaining fifteen crossclaims was proper. View "Orlando Residence, Ltd. v. Alliance Hospitality Management, LLC" on Justia Law

The Supreme Court affirmed the order of the district court granting summary judgment against a real estate agency on its complaint against the seller and buyers of certain property for breach of an exclusive listing agreement and tortious interference with a contract, business relationship, or expectation, holding that summary judgment was properly granted.The sale of the property occurred after the listing period and after the protection period of the agreement, and no commission was paid. The negotiations for the sale were conducted directly between the seller and buyers, with the real estate agent's knowledge. The district court granted Defendants' motions for summary judgment. On appeal, the real estate agency argued that summary judgment was inappropriate because the district court held the summary judgment hearing before the real estate company had conducted depositions. The Supreme Court affirmed, holding (1) the district court did not prematurely address Defendants' motions for summary judgment; and (2) the district court erred in awarding attorney fees. View "George Clift Enterprises, Inc. v. Oshkosh Feedyard Corp." on Justia Law

Six Dimensions filed suit against a former employee and a competitor, Perficient, alleging claims for breach of contracts, unfair competition, and misappropriation of trade secrets.The Fifth Circuit reversed the part of the judgment holding that the employee breached an employment contract and owed damages to Six Dimensions. The court held that the district court abused its discretion in denying the employee an opportunity to extend the arguments she had already made about the 2014 Agreement and have them apply to the 2015 Agreement. However, the court held that the district court did not reversibly err in interpreting California law and concluding that California's strict antipathy towards restraint of trade of any kind in California Business and Professions Code section 16600 voids the nonsolicitation provision here. The court also found no error in the district court's refusal to apply California's Unfair Competition Law, and held that the district court did not abuse its discretion in refusing to find the jury's verdict contrary to the weight of the great evidence as to the misappropriation claim. Therefore, the court otherwise affirmed the district court's judgment. View "Six Dimensions, Inc. v. Perficient, Inc." on Justia Law

Defendants-tenants John and Rosa Castro (the tenants) leased a residential property from plaintiff-landlord Fred Graylee. The landlord brought an unlawful detainer action against the tenants, alleging they owed him $27,100 in unpaid rent. The day of trial, the parties entered into a stipulated judgment in which the tenants agreed to vacate the property by a certain date and time. If they failed to do so, the landlord would be entitled to enter a $28,970 judgment against them. The tenants missed their move-out deadline by a few hours and the landlord filed a motion seeking entry of judgment. The trial court granted the motion and entered a $28,970 judgment against the tenants under the terms of the stipulation. The tenants appealed, arguing the judgment constituted an unenforceable penalty because it bore no reasonable relationship to the range of actual damages the parties could have anticipated would flow from a breach of the stipulation. To this, the Court of Appeal agreed, and reversed and remanded this matter for further proceedings. View "Graylee v. Castro" on Justia Law

The Supreme Judicial Court affirmed the judgment of the superior court in favor of Tucker Cianchette and CBF Associates, LLC (collectively, Tucker) and against Peggy Cianchette, Eric Cianchette, PET, LLC and Cianchette Family, LLC (collectively, Peggy and Eric) on Tucker's claims against Peggy and Eric and on Peggy and Eric's counterclaim against Tucker, holding that the superior court did not err in clarifying that post-judgment interest began to run on March 15, 2018.In this second appeal before the Supreme Court, the parties sought resolution of two legal issues regarding post-judgment interest: (1) whether the trial court had jurisdiction to issue an order on post-judgment interest, and (2) on what date prejudgment interest ceased and post-judgment interest began to accrue. The Supreme Judicial Court held (1) the trial court had authority to act and did not abuse its discretion in clarifying its judgments to resolve the parties' uncertainty surrounding post-judgment interest; and (2) post-judgment interest did not begin to run until the court entered the final judgment on March 15, 2018. View "Cianchette v. Cianchette" on Justia Law

The Supreme Court held that tortious interference with at-will contracts requires independent wrongfulness and that a rule of reason applies to determine the validity of a settlement provision requiring Forward Pharma to terminate its agreement with Ixchel Pharma, LLC under Cal. Bus. & Prof. Code 16600.Ixchel, a biotechnology company, entered into an agreement with Forward jointly to develop a drug for the treatment of Friedreich's ataxia. Forward later withdrew from the agreement, which was allowed by the agreement's terms. Pursuant to a settlement with Biogen, Inc., another biotechnology company, Forward agreed to terminate its contract with Ixchel. Ixchel sued Biogen in federal court for tortiously interfering with Ixchel's contractual and prospective economic relationship with Forward in violation of section 16600. On appeal, the federal appeals court certified two questions to the Supreme Court. The Supreme Court held (1) tortious interference with at-will contracts requires independent wrongfulness, and therefore, Ixchel must allege that Biogen interfered with its at-will contract through wrongful means; and (2) the validity of the settlement provision at issue must be evaluated based on a rule of reason. View "Ixchel Pharma, LLC v. Biogen, Inc." on Justia Law

The Court of Chancery granted in part and denied in part the motion for partial summary judgment filed by Applied Energetics, Inc. (the Company) on its claims against George Farley, the Company's former director and principal executive officer, and AnneMarieCo, LLC, holding that Farley lacked authority to issue himself twenty-five million shares and grant himself an annual salary of $150,000 per year but that the Company was not entitled to summary judgment on Farley's counterclaims.The Company asserted several claims based on Farley's actions. Farley filed counterclaims against the Company for breach of contract, for unjust enrichment, and to validate his actions under section 205 of the Delaware General Corporation Law. The Company moved for partial summary judgment. The Court of Chancery granted the motion in part and denied it in part, holding (1) because Farley was the Company's sole remaining director when he issued himself stock and granted himself compensation, Farley's actions were invalid; (2) because the Company had the corporate power to issue shares and compensate its officers and directors Farley's acts could be validated under section 205; (3) the Court had the power to validate Farley's decision to grant himself a salary; and (4) evidence could support Farley's claim for compensation under a theory of quantum merit. View "Applied Energetics, Inc. v. Farley" on Justia Law

The Supreme Court reversed the determination of the district court that a contract entered into by a dissolved partnership was void, holding that the contract was voidable.Two years after the Muir Second Family Limited Partnership was administratively dissolved, the former general partner of the partnership - Nicholas Muir - obtained a loan from the TNE Limited Partnership through a trust deed. Wittingham, LLC, a successor-in-interest to the Partnership, brought suit to declare the trust deed void and recover damages. The district court concluded that the trust deed was void because the Partnership was dissolved prior to the time Muir signed the trust deed. The Supreme Court reversed, holding that the trust deed was voidable because the relevant statutes failed to provide a clear and well-defined public policy indicating that the type of transaction here should be void and because the transaction deed did not harm the public as a whole. View "Wittingham v. TNE Limited Partnership" on Justia Law

Victor Bliss appealed the grant of summary judgment in favor of the Minidoka Irrigation District (“MID”). Bliss filed a complaint against MID in April 2017, alleging: (1) breach of contract; (2) breach of fiduciary duty; (3) trespass; (4) declaratory relief; and (5) wrongful prosecution/infliction of extreme emotional distress. The complaint encompassed multiple events stemming from his decades-long relationship with MID. The district court granted MID’s motion for summary judgment on all claims, dismissing Bliss’s complaint for lack of notice under the Idaho Tort Claims Act, lack of standing, and failure to produce evidence. Bliss timely appealed, but finding no reversible error, the Idaho Supreme Court affirmed summary judgment. View "Bliss v. Minidoka Irrigation District" on Justia Law