Justia Contracts Opinion Summaries

T-Mobile customers can participate in “T-Mobile Tuesdays,” a promotional service, offering free items and discounts. Customers who no longer wish to receive marketing communications may opt-out by contacting T-Mobile’s customer service. T-Mobile user Warciak received a text message: This T-Mobile Tuesday, score a free 6” Oven Roasted Chicken sub at SUBWAY, just for being w/ T-Mobile. Ltd supply. Get app for details. The message came from T-Mobile. Warciak was not charged for the text. Warciak sued Subway claiming Subway engaged in a common-law agency relationship with T-Mobile, and that Subway’s conduct violated the Telephone Consumer Protection Act (TCPA). T-Mobile is not included in the lawsuit. The court dismissed the complaint as lacking sufficient support for claims of actual and apparent authority: control over the timing, content, or recipients of the text message. The court also found that the wireless carrier exemption applied so that no underlying TCPA violation exists ( 47 U.S.C. 227(b)(2)(C)). Prior written consent is not required for calls to a wireless customer by his wireless carrier if the customer is not charged. The Seventh Circuit affirmed. The only alleged conduct by Subway is its contractual relationship with T-Mobile. Warciak’s complaint lacks sufficient facts showing Subway manifested to the public that T-Mobile was its agent. He relied on T-Mobile’s conduct. Statements by an agent are insufficient to create apparent authority without also tracing the statements to a principal’s manifestations or control. View "Warciak v. Subway Restaurants, Inc." on Justia Law

In this venue dispute, the Supreme Court denied a petition for mandamus relief, holding that the trial court did not abuse its discretion in transferring the case to the parties' agreed venue.This case stemmed from a lawsuit alleging wrongful disposition of a limited partnership's assets. A group of the limited partners (collectively, Fox River) sued William Carlson, who owned and controlled the partnership's general partner, claiming that Carlson fraudulently misappropriated groundwater leases, breached the limited partnership agreement, and violated fiduciary duties. Fox River filed the lawsuit in Washington County where Carlson was domiciled. Carlson moved to transfer venue to Harris County, citing a venue-selection clause in the limited partnership agreement. The trial court granted the motion, enforcing the parties' venue agreement in accordance with Tex. Civ. Prac. & Rem. Code 15.020. Fox River sought mandamus relief, arguing that Tex. Civ. Prac. & Rem. Code 65.023(a) mandates venue in a defendant's county of domicile for cases primarily seeking injunctive relief. The Supreme Court denied mandamus relief, holding that section 15.020 requires enforcement of the parties' venue-selection agreement not because it is a "super mandatory" venue provision that supersedes section 65.023(a) but because section 65.023(a) does not apply in suits like this where injunctive relief is not the primary and principal relief requested. View "In re Fox River Real Estate Holdings, Inc." on Justia Law

The Supreme Court affirmed the judgment of the court of appeals reversing the judgment of the trial court concluding that Petitioners (together, ETP) and Respondents (together, Enterprise) had created a partnership to market and pursue a pipeline project to transport crude oil from Oklahoma to the Gulf Coast, holding that Texas law permits parties to conclusively agree that, as between themselves, no partnership will exist unless certain conditions are satisfied.In three written agreements, the parties set forth their intent that neither party be bound to proceed with the project at issue until each company's board of directors had approved the execution of a formal contract and definitive agreements memorializing the terms and conditions of the transactions were executed and delivered. ETP later sued arguing the parties had formed a partnership to market and pursue a pipeline and that Enterprise breached its statutory duty of loyalty. The trial court entered judgment for ETP. The court of appeals reversed. The Supreme Court affirmed, holding (1) parties can conclusively negate the formation of a partnership through contractual conditions precedent; and (2) the parties did so as a matter of law in this case, and there was no evidence that Enterprise waived the conditions. View "Energy Transfer Partners, LP v. Enterprise Products Partners, LP" on Justia Law

Luv N’ Care, Ltd. (“LNC”), a Louisiana corporation, filed suit against Jackel International Limited (a corporation established under the laws of England and Wales, having its principal place of business in England) and others, relating to a distribution agreement for child and baby care items. Jackel would be the exclusive distributor of certain LNC products. LNC contended Jackel agreed bot to copy any of LNC's products, their design, prototypes, packaging, methods, or any other proprietary information without LNC's written permission. However, LNC alleged that, on or about October 2009, it learned that Jackel had been selling child and baby products not covered under the terms of the distribution agreement with LNC, but which closely resembled LNC products. Furthermore, in April of 2010, LNC learned that Jackel began to commercialize additional child and baby products, which allegedly incorporated LNC’s products, design, and/or packaging in violation of the contract between the parties. This case presented an issue of first impression for the Louisiana Supreme Court regarding whether La. R.S. 13:4611(1)(g) authorized an award of attorney fees to a party in a contempt proceeding, who had been found not guilty of contempt of court, or whether an award of attorney fees was only authorized in favor of a party who successfully prosecuted a contempt action. The district court awarded, and the appellate court affirmed, attorney fees to Jackel, who was found not to be in contempt, as the “prevailing party.” Having determined that La. R.S. 13:4611(1)(g) only authorized courts to award attorney fees to a party who successfully prosecuted a rule for contempt of court, the Supreme Court concluded the district court erred in awarding attorney fees in favor of Jackel, and reversed the appellate and district courts holding otherwise. Insofar as the judgment awarded attorney fees, that portion was vacated. View "Luv N' Care, Ltd. v. Jackel International Limited" on Justia Law

When Erik Knight sold KnighTek, LLC to Jive Communications, Inc., Jive allegedly agreed to pay Knight $100,000 upfront and a revenue-based payment stream capped at $4.6 million. The continuing payments would convert to a lump sum payment if Jive’s ownership changed. Years later, Jive offered to cash out KnighTek for $1.75 million, a substantial discount from the remaining cap amount. According to Knight, Jive’s representatives told him the buy-out money depended on KnighTek accepting the proposal right away. If it did not, Jive would use the funds for other buyouts. Jive’s representatives also told Knight if he turned down the offer, it would take five years for Jive to make the remaining payments. Two days after KnighTek agreed to accept $1.75 million, Jive announced publicly it was being acquired by LogMeIn for $342 million - a change of control that according to KnighTek would have netted it a $2.7 million immediate payment under their earlier agreement. Believing it had been misled and shorted about $1 million, KnighTek filed suit against Jive, alleging that Jive fraudulently induced KnighTek to take the discounted payout. According to KnighTek, Jive and its representatives knew about the imminent change of control, misrepresented the availability of buyout funds, and duped KnighTek into accepting a discount when KnighTek could have received almost $1 million more and an immediate payment after the LogMeIn transaction. A Delaware superior court dismissed the complaint, finding some of Jive’s alleged misrepresentations lacked particularity and others failed to state a claim under Utah law, the law governing their agreements. The Delaware Supreme Court disagreed, finding that, viewing the complaint in the light most favorable to KnighTek, accepting as true its well-pleaded allegations, and drawing all reasonable inferences that logically flow from those allegations, KnighTek alleged fraud with sufficient particularity and stated a claim for fraudulent misrepresentation under Utah law. Thus the Court reversed the lower court’s dismissal, and remanded for further proceedings. View "Knightek, LLC v. Jive Communications, Inc." on Justia Law

Plaintiff-appellant Germaninvestments Aktiengesellschaft (AG) (“Germaninvestments”) was a Swiss holding company formed to manage assets for the Herrling family. Defendant Allomet Corporation (“Allomet”) was a Delaware corporation that manufactured high-performance, tough-coated metal powders using a proprietary technology for coating industrial products. Defendant Yanchep LLC (“Yanchep”), was also a Delaware limited liability company with Mirta Hereth as its sole member (together, Allomet and Yanchep are referred to as “Appellees”). Allomet struggled with declining performance as early as 2002. In mid-2016, Tanja Hausfelder, an insurance professional who apparently knew or worked with the Herrlings and Hereth, advised Herrling that Hereth was looking for a joint venture partner to join Allomet. After a meeting in Switzerland, Herrling and Hereth discussed a general structure for their joint venture to raise capital for Allomet. The issue this case presented for the Delaware Supreme Court’s review centered on whether the Court of Chancery correctly determined that a provision in a Restructuring and Loan Agreement between the parties was a mandatory, as opposed to a permissive, forum selection clause. The Court of Chancery held that Austrian law governed the analysis of the forum selection provision, and determined that the provision is governed by Article 25 of the European Regulation on Jurisdiction and Recognition and Enforcement of Judgments in Civil and Commercial Matters. Based upon these conclusions, the court granted Defendants’ motion to dismiss in favor of the Austrian forum. The Delaware Supreme Court held that Appellees, who raised Austrian law as a basis for their motion to dismiss, had the burden of establishing the substance of Austrian law, and that the Court of Chancery erred in determining that Appellees had carried that burden. Accordingly, the forum selection provision analysis should have proceeded exclusively under Delaware law. Applying Delaware law, the Delaware Court determined the forum selection provision was permissive, not mandatory. “As such, the forum selection provision is no bar to the litigation proceeding in Delaware.” The Court affirmed the Court of Chancery’s holding that 8 Del. C. section 168 was not the proper mechanism for the relief Appellants sought. Therefore, this matter was affirmed in part, reversed in part, and remanded to the Court of Chancery for further proceedings. View "Germaninvestments AG v. Allomet Corporation" on Justia Law

A New York owner of a fast-food property in Illinois, which was rented by an Arizona tenant, sold the property to buyers in California (Abellan). The tenant declared bankruptcy and never paid rent to its new landlord. Abellan sued. A jury found the purchase agreement rescindable for mutual mistake and the sellers liable for fraud and breach of contract and awarded damages of more than $2 million. The Seventh Circuit affirmed. The sellers warranted to Abellan that there was “no default by Seller, or to Seller’s knowledge ... under the Lease.” A critical provision of the lease required the tenant to operate its restaurant business continuously. the jury had sufficient evidence to find a breach of the no-default warranty “to Seller’s knowledge” and Abellan reasonably relied on the no-default warranty. The court rejected claims of waiver and that the jury’s findings on damages and reliance were contrary to the weight of the evidence. View "Abellan v. Lavelo Property Management, LLC" on Justia Law

Petitioner Hensel Phelps Construction Co. (Hensel Phelps) was a defendant in construction defect litigation filed by plaintiff and real party in interest Smart Corner Owners Association (Smart Corner). Hensel Phelps moved for summary judgment contending, among other things, that Smart Corner's claims were barred by a 10-year limitations period under Civil Code section 941. Smart Corner was not a party to the contract between Hensel Phelps and the developer of a mixed-use project, to which Smart Corner was a lessee. In its motion for summary judgment, Hensel Phelps asserted that "substantial completion" under the statute had the same meaning as "substantial completion" in its construction contract with the developer. Because the parties to the construction contract agreed that "substantial completion" occurred on a certain date at the time of construction, Hensel Phelps argued that the limitations period began to run on that date. Because Smart Corner asserted its claims more than 10 years later, Hensel Phelps contended they were untimely. The trial court denied the motion, finding that the definition of substantial completion in the contract did not trigger the running of the statute. And, even if it did, Smart Corner had raised a triable issue of fact whether the definition of substantial completion under the contract had been satisfied on the date asserted by Hensel Phelps. Hensel Phelps petitioned the Court of Appeal for mandamus relief, arguing again that the date of substantial completion adopted by the parties to the contract "conclusively establishe[d]" the date of substantial completion under the statute. After review, the Court of Appeal concluded the trial court did not err by denying Hensel Phelps's motion for summary judgment. "Hensel Phelps offers no authority for the novel proposition that certain parties may, by contract, conclusively establish the date when a limitations period begins to run on another party's cause of action. ... it is clear that the statute does not simply adopt the date determined by private parties to a contract for their own purposes as the date of substantial completion." The Court therefore denied the petition. View "Hensel Phelps Construction Co. v. Super. Ct." on Justia Law

At issue in this case was whether a federal court sitting in Oklahoma had specific jurisdiction over Dr. Scott Jolly, a dentist and Arkansas resident, and his Limited Liability practice, Jolly Dental Group, LLC. Dental Dynamics, LLC argued that three isolated business transactions and an allegedly fraudulent contract were sufficient to establish federal court jurisdiction over its breach of contract and fraud claims. The Tenth Circuit disagreed, finding Jolly Dental's contacts with Oklahoma were "too random, fortuitous, and attenuated" to establish personal jurisdiction there. With respect to Denta; Dynamics' fraud claim, the Court concluded Dental Dynamics failed to show conduct sufficiently targeted to Oklahoma to establish personal jurisdiction there. View "Dental Dynamics v. Jolly Dental Group" on Justia Law

Oil Capital Ready Mix, LLC; Agape Holdings, LLP; Scott Dyk; and Samuel Dyk (collectively “Dyk”) appealed a judgment awarding Skaw ND Precast LLC (“Skaw”) $69,295 in damages for conversion of its property. In March 2013, Skaw entered into a five-year agreement with Tioga Ready Mix (“Tioga”), a company which produced ready-mix concrete product, to rent a two-acre parcel of land to conduct its business. The base rent for the site was $700 per month, subject to reductions if Skaw purchased designated quantities of ready-mix product from Tioga. The agreement provided it would remain in effect until December 31, 2018, and it did not allow either party to unilaterally cancel the agreement. In spring 2015, Skaw learned that Tioga had arranged to sell Tioga’s assets at a public auction, including the two-acre parcel of property where Skaw conducted its business. Skaw’s owners attended the auction sale in May 2015. The auction service notified all attendees that Skaw’s assets on the premises were not part of the sale, that there was a lease in place between Skaw and Tioga, and that the lease went with the land. Dyk was the successful bidder at the auction and entered into a commercial purchase agreement with the sellers which did not include Skaw’s product inventory or equipment and stated the sale was subject to “rights of tenants,” but did not list Skaw as a tenant. Once Dyk got its ready-mix plant running, Skaw began purchasing concrete ready-mix product from Dyk for its business. When presented with the contract between Skaw and Tioga, Dyk renegotiated the terms; Dyk and Skaw agreed to increase monthly rental payments to $750 per month. During a scheduled shut down of both companies' operations, Dyk built an earthen berm around Skaw’s equipment which prevented Skaw from accessing it. Dyk also transported Skaw’s concrete pad and blocked inventory off of Skaw’s two acres to an area adjacent to Dyk’s offices. Other Skaw assets were transported to undisclosed locations. When Skaw discovered the berm, Dyk informed Skaw that Skaw abandoned their temporary rental agreement in December 2015 and that law enforcement would be notified if there were “any attempts to breach the peace or trespass” on the property. Skaw replied that the 2013 lease was still valid and had not been abandoned, and that Skaw planned to return to the property and continue operations. Dyk argued on appeal of the conversion damages award that the district court erred in ruling the 2013 agreement between Skaw and Tioga was a lease rather than a license. Because the North Dakota Supreme Court concluded the district court’s findings of fact were not clearly erroneous, it affirmed the judgment. View "Skaw ND Precast, LLC v. Oil Capital Ready Mix, LLC, et al." on Justia Law