Justia Contracts Opinion Summaries

A bank holding company sued two guarantors for breach of their personal guaranties on a $1.5 million loan extended to an entity they were involved with. The guarantors argued that the bank holding company lacked standing to sue because there was no written assignment of the loan documents from the original lender, a bank, to the holding company. The district court admitted the written assignment into evidence and found that the holding company had standing. The court also granted summary judgment in favor of the holding company, finding the guarantors liable under the terms of their guaranties.The guarantors had counterclaimed against the holding company and other parties, alleging fraudulent concealment, fraudulent misrepresentation, civil conspiracy, and breach of the implied covenant of good faith and fair dealing. They argued that the bank and its president conspired with a now-deceased individual to conceal the financial instability of the individual’s entities, which led to the guarantors entering into the guaranties. The district court found no genuine issue of material fact regarding these counterclaims and granted summary judgment for the holding company.The guarantors also attempted to file a document in which the personal representative of the deceased individual’s estate confessed judgment against the estate. The district court ruled this filing a nullity, as the personal representative’s appointment had been terminated before the filing, and he was not authorized to act on behalf of the estate.The Nebraska Supreme Court affirmed the district court’s rulings, holding that the holding company had standing, the guarantors were liable under the guaranties, and the counterclaims were unsupported by evidence. The court also upheld the ruling that the purported confession of judgment was a nullity. View "Henderson State Co. v. Garrelts" on Justia Law

Clinton Mahoney, the sole member and manager of Mahoney & Associates, LLC, signed an agreement obligating the company to contribute to the Railroad Maintenance and Industrial Health and Welfare Fund, an employee benefit fund. When the Fund could not collect delinquent contributions from Mahoney & Associates, it sued Mahoney personally, citing a personal liability clause in the agreement. The district court granted summary judgment to the Fund, concluding that Mahoney was personally liable based on the clause.The United States District Court for the Central District of Illinois initially entered judgment on July 31, but it did not comply with Federal Rule of Civil Procedure 58. Mahoney filed a notice of appeal on September 26, and the district court later entered a corrected judgment on October 11. Mahoney filed a second notice of appeal the same day. The district court had awarded the Fund attorneys’ fees based on the trust agreement.The United States Court of Appeals for the Seventh Circuit reviewed the case de novo. The court found that there was a genuine dispute of material fact regarding Mahoney’s intent to be personally bound by the trust agreement, as he signed the memorandum in a representative capacity, which conflicted with the personal liability clause. The court concluded that this issue could not be resolved at summary judgment. The court also addressed Mahoney’s laches defense but found it waived due to his failure to address relevant complications. Consequently, the Seventh Circuit reversed the district court’s grant of summary judgment and vacated the award of attorneys’ fees, remanding the case for further proceedings. View "Railroad Maintenance and Industrial Health & Welfare Fund v. Mahoney" on Justia Law

The case involves a dispute between Peter Lowes and Amy Thompson, formerly Amy Lowes, regarding a nondisparagement clause in their stipulated divorce judgment. Lowes alleged that Thompson breached this clause by describing him as her "abuser" during a political campaign interview. Thompson filed a special motion to strike the breach of contract claim under Oregon’s anti-SLAPP statute, which aims to quickly dismiss nonmeritorious claims arising from protected speech. The trial court granted Thompson’s motion, but the Court of Appeals reversed, concluding that the nondisparagement clause waived Thompson’s right to the anti-SLAPP statute’s protections.The Deschutes County Circuit Court initially granted Thompson’s special motion to strike, finding that her statements were protected under the anti-SLAPP statute and that Lowes failed to show a probability of prevailing on his claim. The Court of Appeals reversed this decision, holding that the nondisparagement clause constituted a waiver of Thompson’s anti-SLAPP protections, thus making it unnecessary to evaluate whether Lowes could prevail on his claim.The Oregon Supreme Court reviewed the case and disagreed with the Court of Appeals. The Supreme Court held that the nondisparagement clause did not clearly indicate an intention to waive the procedural protections of the anti-SLAPP statute. Therefore, the clause alone could not defeat Thompson’s special motion to strike. The Supreme Court reversed the Court of Appeals' decision in part and remanded the case back to the Court of Appeals to determine whether Lowes met his burden of establishing a probability of prevailing on his breach of contract claim. View "Lowes v. Thompson" on Justia Law

E.H. Turf Supply Company, Inc. filed a small-claims action against Roger Tavares, alleging that Tavares stopped payment on a check for services performed on his tractor. Tavares denied the allegations and counterclaimed for $2,500, asserting that the services were not rendered. The District Court ruled in favor of E.H. Turf Supply, awarding $1,500 plus costs. Tavares appealed to the Superior Court, arguing procedural errors and bias.The Superior Court held a de novo bench trial. E.H. Turf Supply presented testimony from its president, Erik Hagenstein, who detailed the company's repair process and confirmed that Tavares had approved and paid for the services before stopping payment. Tavares cross-examined Hagenstein and attempted to introduce invoices from other repair shops to show that the repairs were not properly done. The trial justice excluded these invoices as hearsay but allowed Tavares to testify about his experience.The Superior Court found in favor of E.H. Turf Supply, awarding $1,703.71. Tavares appealed to the Rhode Island Supreme Court, arguing that the Superior Court erred in allowing E.H. Turf Supply to present its case first, excluding his evidence, and not considering his status as a self-represented litigant.The Rhode Island Supreme Court reviewed the case and found no merit in Tavares's arguments. The Court held that E.H. Turf Supply, as the plaintiff, was correctly allowed to present its case first. The exclusion of the invoices was proper as they were hearsay, and the trial justice provided Tavares with ample opportunity to present his case. The Court affirmed the judgment of the Superior Court. View "E.H. Turf Supply Co. v. Tavares" on Justia Law

Claudia Horn worked for Insure Idaho, LLC for over six years and signed a non-solicitation agreement prohibiting her from soliciting Insure Idaho customers. After leaving Insure Idaho to work for Henry Insurance Agency, LLC, several Insure Idaho customers followed her. Insure Idaho sought a preliminary injunction to prevent Horn and Henry Insurance from soliciting its customers, which the district court granted. The district court later found Horn in contempt for violating the preliminary injunction when another former Insure Idaho customer moved its business to Henry Insurance.The district court granted the preliminary injunction and found Horn in contempt, but did not impose any sanctions. Henry Insurance was dismissed from the contempt proceedings and awarded attorney fees. Horn appealed the contempt judgment, and both Henry Insurance and Insure Idaho cross-appealed.The Supreme Court of Idaho reviewed the case and determined that the district court erred in finding Horn in contempt, as it lacked the ability to impose any sanction. The court also found that the district court misinterpreted the term "solicitation" and that Horn's actions did not constitute solicitation under the plain meaning of the term. The court held that the district court abused its discretion by granting the preliminary injunction without adequately addressing whether Insure Idaho was likely to succeed on the merits of its claims.The Supreme Court of Idaho reversed the judgment of contempt, vacated the preliminary injunction, and remanded the case for further proceedings. The court affirmed the district court's dismissal of Henry Insurance from the contempt proceedings and awarded attorney fees to Henry Insurance. The court also awarded Horn attorney fees for the contempt trial and appellate attorney fees for both Horn and Henry Insurance. View "Insure Idaho v. Horn" on Justia Law

During the COVID-19 pandemic, K7 Design Group, Inc. (K7) offered to sell hand sanitizer to Walmart, Inc., doing business as Sam’s Club (Sam’s Club). K7 and Sam’s Club discussed and agreed upon the product, price, quantity, and delivery terms for various hand sanitizer products through email communications. K7 delivered over 1,000,000 units of hand sanitizer to Sam’s Club, which paid approximately $17.5 million. However, Sam’s Club did not collect or pay for the remaining hand sanitizer, leading to storage issues for K7.The United States District Court for the Western District of Arkansas held a jury trial, where the jury found in favor of K7 on its breach of contract claim and awarded $7,157,426.14 in damages. Sam’s Club’s motions for judgment as a matter of law and for a new trial were denied by the district court.The United States Court of Appeals for the Eighth Circuit reviewed the case. Sam’s Club argued that K7 failed to present sufficient evidence of an obligation to pay for the products, the jury’s verdict was against the weight of the evidence, and the district court abused its discretion in instructing the jury. The Eighth Circuit affirmed the district court’s decision, holding that the communications between K7 and Sam’s Club constituted binding orders under Arkansas’s Uniform Commercial Code (UCC). The court found that the evidence supported the jury’s verdict and that the district court did not abuse its discretion in its jury instructions or in denying Sam’s Club’s motions. The court also affirmed the district court’s award of prejudgment interest and attorney fees and costs. View "K7 Design Group, Inc. v. Walmart, Inc." on Justia Law

Hexagon US Federal, Inc. ("HexFed") leased a portion of a building, which was later sold to CBS Holdings, LLC. A dispute arose regarding the lease's renewal, leading HexFed to file a lawsuit against CBS Holdings for breach of lease. CBS Holdings counterclaimed. The Madison Circuit Court ruled in favor of HexFed on all claims and awarded costs and attorney fees to be determined later. CBS Holdings appealed, and the Supreme Court of Alabama affirmed the trial court's judgment, including the award of costs and attorney fees.After an evidentiary hearing, the Madison Circuit Court awarded HexFed $174,987.45 in costs and attorney fees. CBS Holdings appealed, arguing that HexFed's application for attorney fees was inadequately supported due to redacted descriptions of legal work and that the trial court's order lacked sufficient detail for meaningful appellate review.The Supreme Court of Alabama reviewed the case and agreed with CBS Holdings. The court found that HexFed's heavily redacted invoices did not provide enough information to determine the reasonableness and necessity of the attorney fees. The court emphasized that a trial court's order must allow for meaningful appellate review by articulating the decisions made, the reasons supporting those decisions, and how the attorney fee was calculated, considering all the Peebles factors.The Supreme Court of Alabama reversed the trial court's order and remanded the case for HexFed to provide adequate support for its application for costs and attorney fees. The trial court was instructed to accept any necessary information or evidence to confirm the requested attorney fees and to enter a detailed order showing how it calculated the amount awarded and how it considered the Peebles factors. View "CBS Holdings, LLC v. Hexagon US Federal, Inc." on Justia Law

AST & Science LLC, a company in the satellite technology and communications business, hired Delclaux Partners SA to introduce it to registered broker-dealers for investment purposes. Delclaux introduced AST to LionTree Advisors LLC, which handled AST's Series A financing. Two contracts were involved: a Finder’s Fee Agreement between AST and Delclaux, and a separate agreement between AST and LionTree. After the Series B financing, Delclaux claimed it was owed fees from four transactions, which AST refused to pay, leading to AST suing Delclaux for breach of contract, alleging Delclaux acted as an unregistered broker-dealer.The United States District Court for the Southern District of Florida denied summary judgment on AST’s complaint and granted summary judgment to AST on Delclaux’s counterclaim. Delclaux appealed, but the appeal was voluntarily dismissed due to jurisdictional questions. The district court later held that it lacked diversity jurisdiction but claimed federal-question jurisdiction, asserting that the case involved a federal issue regarding the Securities Exchange Act.The United States Court of Appeals for the Eleventh Circuit reviewed the case and disagreed with the district court’s assertion of federal-question jurisdiction. The appellate court held that the breach-of-contract claim was governed by state law and did not meet the criteria for federal-question jurisdiction under the Grable & Sons Metal Products, Inc. v. Darue Engineering & Manufacturing test. The court found that the federal issue was not substantial enough to warrant federal jurisdiction. Consequently, the Eleventh Circuit vacated the district court’s judgment and remanded the case with instructions to dismiss it for lack of subject-matter jurisdiction. View "AST & Science LLC v. Delclaux Partners SA" on Justia Law

Darian McKinney, a health and physical education teacher, was employed by the District of Columbia Public Schools (DCPS) for four years. During his tenure, he was investigated for sexual harassment, leading to a grievance he filed against DCPS. Both disputes were resolved through a Settlement Agreement, under which McKinney resigned but was allowed to reapply for teaching positions. However, when he reapplied, DCPS blocked his return, citing a failed background check.McKinney sued the District of Columbia, alleging that DCPS breached the Settlement Agreement by not fairly considering his employment applications and deprived him of property and liberty without due process. The United States District Court for the District of Columbia dismissed his complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6).The United States Court of Appeals for the District of Columbia Circuit reviewed the case. The court held that the Settlement Agreement did not obligate DCPS to fairly consider McKinney’s applications, only to allow him to apply. The court found no basis in the contract’s language or law for McKinney’s demand for fair consideration. Additionally, the court ruled that McKinney did not have a constitutionally protected property interest in his original job, the contingent job offers, or his eligibility for DCPS positions. The court also found that McKinney’s claim of deprivation of liberty without due process was forfeited as it was not raised in the lower court.The court affirmed the district court’s dismissal of McKinney’s complaint. View "Darian McKinney v. DC" on Justia Law

In 2008, the former Attorney General of Mississippi entered into a retention agreement with the Kilborn Firm to sue Entergy Corporation over electricity rates. The Kilborn Firm then agreed to split any compensation with Roedel Parsons, a Louisiana law firm. After years of litigation, the trial judge granted Entergy’s motion for summary judgment, dismissing the case with prejudice. The State did not appeal. Roedel Parsons then sued the State, claiming it was entitled to $34,625,000 as a third-party beneficiary under the retention agreement or, alternatively, for unjust enrichment and quantum meruit recovery.The Hinds County Circuit Court granted the State’s motion to dismiss under Mississippi Rule of Civil Procedure 12(b)(6) for failure to state a claim. The court found that Roedel Parsons was not a third-party beneficiary under the retention agreement, as the agreement specified that any associated attorneys would be at the Kilborn Firm’s expense and at no cost to the State. The court also found that Roedel Parsons failed to state a claim for unjust enrichment and quantum meruit recovery, as the State had no obligation to compensate Roedel Parsons under the terms of the agreement.The Supreme Court of Mississippi reviewed the case and affirmed the lower court’s decision. The court held that Roedel Parsons was not a third-party beneficiary under the retention agreement and had no standing to sue the State for breach of contract. The court also held that Roedel Parsons failed to state a claim for unjust enrichment and quantum meruit recovery, as the State had no reasonable expectation to compensate Roedel Parsons. The court further found that the common-fund doctrine did not apply, as Roedel Parsons failed to identify a specific fund or class of beneficiaries. View "Roedel Parsons Blache Fontana Piontek & Pisano v. State of Mississippi" on Justia Law