Justia Contracts Opinion Summaries

Plaintiff offered to sell 3 million pounds of scrap copper to the defendant. The defendant negotiated the core terms of the sale but did not object to a fee-shifting provision: “In the event purchaser shall default in his obligations hereunder, purchaser shall be liable for [the plaintiff]’s costs of collection, including attorney’s fees.” The contract was negotiated between two experienced and sophisticated commercial entities. There was no duress. In a suit between the two, the otherwise victorious plaintiff appealed the district court’s ruling that the unilateral fee-shifting clause for attorney’s fees was unenforceable under Ohio law as a matter of public policy. The district court relied on Sixth Circuit precedent, holding that the Ohio Supreme Court would not enforce similar fee-shifting clauses. The Sixth Circuit reversed, noting that the Ohio Supreme Court has since clarified that it would enforce such unilateral or one-sided fee-shifting contract provisions. View "Allied Indus. Scrap, Inc. v. OmniSource Corp." on Justia Law

The parties in this case, two corporations, were parties to a Development Agreement. Defendant claimed Plaintiff owed it approximately $60 million under the Development Agreement. Plaintiff sought a declaration that it did not owe Defendant any money, and Defendant sought reformation of the Development Agreement. After two years of discovery, and as the trial approached, the parties filed a Joint Pretrial Stipulation and Proposed Order (the Proposed Order) identifying fifteen facts as admitted and not requiring proof at trial (the Admitted Facts). Plaintiff moved to have the Court of Chancery declare that certain facts were Admitted Facts and to require Defendant to meet and confer in good faith about additional Admitted Facts. The Court granted the motion, holding (1) facts Defendant admitted in its answer, in its responses to requests for admissions, and drawn from its sworn interrogatory responses constituted Admitted Facts, and Defendant should not have objected to their inclusion in the Proposed Order; and (2) Defendant did not confer in good faith regarding Admitted Facts as required by Ch. Ct. R. 16. View "Itron, Inc. v. Consert, Inc." on Justia Law

Sarun, uninsured when he received emergency services from a hospital owned by Dignity Health, signed an agreement to pay the "full charges, unless other discounts apply.” The agreement explained uninsured patients might qualify for government aid or financial assistance from Dignity. After receiving an invoice for $23,487.90, which reflected a $7,871 “uninsured discount,” and without applying for any other discount or financial assistance, Sarun filed a putative class action, asserting unfair or deceptive business practices (Business and Professions Code 17200) and violation of the Consumers Legal Remedies Act (Civ. Code, 1750). The complaint alleged that: Dignity failed to disclose uninsured patients would be required to pay several times more than others receiving the same services, the charges on the invoice were not readily discernable from the agreement, and the charges exceeded the reasonable value of the services. The trial court dismissed, finding that Sarun had not adequately alleged “actual injury.” The court of appeal reversed. Dignity’s argument Sarun was required to apply for financial assistance to allege injury in fact would be akin to requiring Sarun to mitigate damages as a precondition to suit. Mitigation might diminish recovery, butt does not diminish the party’s interest in proving entitlement to recovery. View "Sarun v. Dignity Health" on Justia Law

Plaintiff Kathryn Kipling sued State Farm Automobile Insurance Company in Colorado federal district court for breach of contract because it did not pay her benefits under four insurance policies issued in Minnesota. The court determined that she would be entitled to benefits under Colorado law but not under Minnesota law. It then applied tort conflict-of-laws principles to rule that Colorado law governed. After its review, the Tenth Circuit held that the court erred by not applying contract conflict-of-laws principles. The district court was reversed and the matter remanded for further consideration. View "Kipling v. State Farm Mutual Automobile" on Justia Law

When Richmont Holdings, Inc. bought the assets of Superior Recharge Systems, LLC the parties signed an asset Purchase Agreement that contained an arbitration provision. Superior Discharge’s part-owner, Jon Blake, signed an employment contract to continue as general manager of the business. The contract contained a covenant not to compete but not an arbitration provision. After Blake’s employment was terminated, Superior Recharge and Blake (together, Blake) sued Richmont in Denton County for fraud and breach of contract. Richmont then sued Blake individually in Dallas County to enforce the covenant not to compete. The Dallas County suit was subsequently abated. Nineteen months after being sued, Richmont moved to compel arbitration, asserting that Blake’s claims arose out of the Asset Purchase Agreement. The trial court denied the motion, and the court of appeals affirmed. The Supreme Court reversed. On remand, the court of appeals concluded that Richmont had waived arbitration by substantially invoking the judicial process. The Supreme Court reversed, holding that the circumstances of this case did not approach a substantial invocation of the judicial process. Remanded. View "Richmont Holdings, Inc. v. Superior Recharge Sys., LLC" on Justia Law

Plaintiff, a construction company, filed a five-count complaint in superior court against Defendants, alleging breach of contract, quantum meruit, unjust enrichment, and violation of the Prompt Payment Act. In the fifth count of the complaint, Plaintiff sought enforcement of a mechanic’s lien it recorded against Defendants’ property. Plaintiff then moved for summary judgment on its claims for breach of contract, violation of the Prompt Payment Act, and enforcement of the mechanic’s lien. The superior court granted summary judgment for Plaintiff on those three counts but made no mention of Plaintiff’s quantum meruit or unjust enrichment claims. Defendants appealed. The Supreme Court dismissed the appeal as interlocutory, as there was no final judgment on any of Plaintiff’s causes of action where two of Plaintiff’s claims were still pending. View "Warren Constr. Group, LLC v. Reis" on Justia Law

Danko practiced law with the firm of O’Reilly & Collins, until, in 2009, Danko sued O’Reilly, as an individual, and O’Reilly & Collins, for unpaid wages. Before trial, O’Reilly, as an individual, obtained directed verdict. In 2012, judgment was entered in favor of Danko for more than $2,000,000. Danko filed moved to amend the judgment and the costs and fee order “to include Terry O’Reilly as a judgment debtor for all amounts owed to Michael Danko” on the ground that O’Reilly knew that the firm owed Danko more than $2 million, but drew out all the firm’s available funds without reserving any amounts to satisfy the debt he knew was owed to Danko, telling Danko “you will not be able to execute on any judgment.” The court of appeal affirmed the trial court’s amendment of the judgment, citing Code Civ. Proc., 187. The court rejected arguments that the amendment was entered in violation of a stay in the bankruptcy of the firm; the amendment was precluded by the doctrine of res judicata; and the amendment was contrary to the principles governing collateral estoppel. View "Danko v. O'Reilly" on Justia Law

Pacific Corporate Group Holdings, LLC (PCGH) sued one of its former employees, Thomas Keck, seeking to collect on a promissory note. Keck defended against the action by claiming that any money that he owed PCGH was offset by monies that PCGH owed him. Keck also filed a cross-complaint against PCGH seeking damages for unpaid bonus and severance payments that he claimed were due to him pursuant to two employment agreements. In a special verdict, the jury found that PCGH owed Keck $270,547.95 under the terms of a 2006 employment agreement. PCGH filed a motion for judgment notwithstanding the verdict (JNOV) or for new trial on the ground that there was no substantial evidence to support the jury's finding that the parties entered into the 2006 Agreement. The trial court denied PCGH's motion. Keck filed a motion for additur, or in the alternative, for a new trial on damages, on the ground that the jury had awarded inadequate damages in light of the bonus and severance provisions in the 2006 Agreement. The trial court granted Keck's motion, and issued an additur and conditional order granting a new trial on damages. PCGH refused to consent to the additur, and thus, the trial court's order directing a new trial on damages became effective. Both parties filed motions for attorney fees, which the court denied. PCGH filed two appeals seeking reversal of the judgment: the trial court's order denying its motion for new trial and JNOV; and the trial court's order granting Keck's motion for additur, or, in the alternative, a new trial on damages; and the trial court's order denying its motion for attorney fees. Keck appealed the trial court's order denying his motion for attorney fees. The Court of Appeal concluded that the trial court's order granting a new trial on damages resulted in a vacatur of the underlying judgment, and therefore, the Court lacked appellate jurisdiction to consider PCGH's appeals, the trial court's order denying its motion for new trial, and the trial court's order denying attorney fees. Furthermore, the Court concluded that it lacked appellate jurisdiction to consider Keck's appeal of the trial court's order denying attorney fees. The Court affirmed both the trial court's order denying PCGH's motion for JNOV and the trial court's order granting Keck's motion for additur, or in the alternative, a new trial on damages. The case was remanded back to the trial court with directions to conduct a new trial on damages and any other necessary proceedings. View "Pacific Corporate Group Holdings v. Keck" on Justia Law

Clint Bowyer, a North Carolina resident, was a professional race car driver for NASCAR. Appellant was also a motorcycle enthusiast who often attended the motorcycle rallies in Sturgis, South Dakota. Kustom Cycles, Inc., a South Dakota corporation, agreed to customize a motorcycle for Bowyer. After Kustom Cycles delivered the motorcycle to Bowyer, it sent Bowyer a bill for the work in the amount of $30,788. Bowyer refused to pay the bill, insisting that the owner of the corporation proposed, and Bowyer performed, compensation in the form of promotions, endorsements, and special access to NASCAR events. Kustom Cycles filed a complaint against Bowyer for payment of the bill. Bowyer moved to dismiss for lack of personal jurisdiction. The circuit court denied the motion. The Supreme Court reversed, holding that Bowyer’s minimal contacts with South Dakota did not meet the “minimum contacts” required to satisfy the Due Process Clause, and Kustom Cycles did not meet its burden of establishing a prima facie case of personal jurisdiction over Bowyer. View "Kustom Cycles, Inc. v. Bowyer" on Justia Law

Universal, a leather wholesaler located in North Carolina, filed suit against Koro, a leather company in Argentina, in North Carolina state court, alleging breach of contract. Koro removed to federal court and the district court granted its motion to dismiss for lack of personal jurisdiction. The court concluded that Universal met its initial burden of demonstrating that Koro purposefully availed itself of the privilege of conducting business in the forum state by submitting affidavits stating that Koro contacted Universal in the forum state, conducted repeated in-person solicitations and meetings concerning the parties' business relationship there, and engaged in numerous business transactions over a two-year period. Accordingly, the court vacated and remanded. View "Universal Leather v. KORO AR" on Justia Law