Justia Contracts Opinion Summaries

Maryville College leased a building to Ruby Tuesday, which used it for corporate retreats. In financial trouble years later, Ruby Tuesday decided to sell its interest in the lease. BNA, a real estate developer, and Ruby Tuesday signed an agreement. Ruby Tuesday had previously secured a loan from Goldman Sachs that prevented Ruby Tuesday from selling its interest in the lease without Goldman’s consent. The agreement with BNA stated that Ruby Tuesday “must obtain approval from [Goldman] for the transaction.” Goldman refused to approve. Goldman later acquired the lease, after Ruby Tuesday’s bankruptcy.BNA sued Goldman under Tennessee law for intentional interference with business relations (IIBR). The Sixth Circuit affirmed the dismissal of the suit. To establish a viable IIBR claim, BNA had to adequately plead an existing business relationship with Ruby Tuesday, Goldman’s knowledge of that relationship, Goldman’s intent to cause a breach or termination of the relationship, Goldman’s improper motive or improper means, and damages from the tortious interference. BNA’s pleading did not satisfy the tort’s fourth prong: improper motive or means. The court also noted the lack of an existing business relationship between BNA and Ruby Tuesday. View "BNA Associates LLC v. Goldman Sachs Specialty Lending Group, L.P." on Justia Law

In 2018, Appellant Nationwide Affinity Insurance Company of America (Nationwide) issued a personal automobile insurance policy to Shameika Clark, Respondent Andrew Green's mother. The policy included $25,000 in UIM property damage coverage for Clark and her family members. The general definition section broadly defined "property damage" as "physical injury to, destruction of[,] or loss of use of tangible property." The UIM endorsement, however, more narrowly defined "property damage" as "injury to or destruction of 'your covered auto.'" In October 2018, Green was hit by a vehicle while walking home from school. Green pursued a claim against Nationwide for UIM bodily injury, but Nationwide refused to pay because the accident did not result in “damage to a “covered auto.” Nationwide filed this declaratory judgment action and requested a declaration that Green was not entitled to UIM property damage. The circuit court reformed Nationwide’s policy rider issued to Clark, finding that under South Carolina case law, insurers could not limit that coverage to vehicles defined in policy as “covered autos.” The South Carolina Supreme Court affirmed the circuit court’s judgment. View "Nationwide v. Green" on Justia Law

The federal district court for the District of South Carolina certified a question of law to the South Carolina Supreme Court. In 2019, USAA issued a personal automobile policy to Megan Jenkins. The policy defined "your covered auto" as any vehicle shown on the policy's declaration, any newly acquired vehicle, and any trailer owned by the insured. While riding her bicycle, Jenkins was struck and killed by an underinsured motorist. Defendant Vincent Rafferty—Jenkins' personal representative—made a claim under Jenkins' policy for UIM property damage arising from damage to the bicycle. USAA Casualty Insurance Company (USAA) denied the claim and commenced this action in federal court, asserting Jenkins' bicycle did not fall within the definition of "your covered auto." Whether USAA prevailed depended upon whether automobile insurers were required to offer UIM property damage coverage at all. If insurers were not required to offer UIM property damage coverage, they were free to restrict such coverage to an insured's "covered auto." The federal court asked the Supreme Court whether, under South Carolina Law, an auto insurer could validly limit underinsured motorist property damage coverage to property damage to vehicles defined in the policy as a “covered auto.” In their briefs and during oral argument, the parties did not directly address the question as framed by the district court. Instead, the parties briefed and argued the broader question of whether an automobile insurer's offer of underinsured motorist (UIM) coverage had to include property damage coverage. Because the answer to the broader question yielded the answer to the certified question, the Supreme Court addressed the parties’ question. USAA rightly conceded that if the Supreme Court held an insurer was required to offer UIM property damage coverage, the Court had to answer the certified question "no." The Court indeed held insurers were required to offer UIM property damage coverage, and therefore answered the certified question "no." View "USAA Casualty v. Rafferty" on Justia Law

At the outset of the COVID-19 pandemic in March 2020, IIT, a nonprofit higher education institution, suspended all in-person instruction, moved all classes online, and restricted access to campus facilities. IIT did not refund tuition or mandatory fees to its students. Before the pandemic, IIT undergraduates were not permitted to register for an online class without special approval and were required to live on campus. Hernandez, a student who paid tuition and fees for the Spring 2020 semester, filed a purported class action, alleging that an express or implied contract was formed under which the university promised to provide in-person instruction, services, and resources, in exchange for tuition and compulsory fees, citing Activity Fees, Student Services Fees, Professional Co-Curricular Fees, and Studio Fees. He also raised an unjust enrichment theory, based on IIT’s retention of students’ full tuition and fees.The district court dismissed, finding that Hernandez failed to identify any specific promise to provide in-person, on-campus instruction to support a breach-of-contract claim and that Hernandez failed to state a claim for unjust enrichment. While his appeal was pending, the Seventh Circuit decided "Gociman," finding that Loyola University students adequately stated claims for breach of an implied contract under Illinois law. The Seventh Circuit reversed the dismissal of Hernandez’s case, finding no meaningful distinctions between his case and Gociman. View "Hernandez v. Illinois Institute of Technology" on Justia Law

This matter arose out of disputes between Antero Resources Corporation (“Antero”) and Airport Land Partners, Ltd (“Airport Land”) and other royalty owners (collectively, “Royalty Owners”) over whether Antero could deduct certain post-production costs from royalty payments under the applicable leases’ royalty clauses. Royalty Owners alleged that Antero has underpaid royalties in violation of their respective lease contracts. Royalty Owners filed individual breach-of-contract suits against Antero for dates between December 2016 and April 2017. Antero moved to dismiss the suits, arguing that the claims should have been brought before the Colorado Oil and Gas Conservation Commission (“COGCC” or “the Commission”) in the first instance. Statutorily, COGCC lacked jurisdiction under section 34-60-118.5(5), C.R.S. (2022), to engage in contract interpretation to resolve a bona fide dispute between parties under an oil and gas lease. But in 2017, without any intervening change to explain the shift, two district courts changed course, asserting that COGCC had responsibility for resolving contract disputes on the theory either that the contract terms were unambiguous or that settled law compelled a certain interpretation. The Colorado Supreme Court returned to the longstanding statutory mandate that COGCC lacked jurisdiction to resolve bona fide disputes of contract interpretation and held that such a dispute exists where the parties disagree in good faith about the meaning or application of a relevant contract term. View "Antero Resources v. Airport Land Partners" on Justia Law

In 2017, KP Engineering entered into a contract with Appellee to engineer and build a natural gas processing plant. KP Engineering hired Appellant as a subcontractor. Midway through the project, KP Engineering stopped paying its subcontractors, including Appellant, resulting in $2,329,830.86 in outstanding invoices. Appellee then ended its contract with KP Engineering but asked Appellant to stay on and complete the project. In exchange, Appellee promised that it would pay Appellant any unpaid invoices. Appellee paid nine of eleven outstanding invoices. Several weeks later, and after Appellant had substantially completed work on the project, Appellee informed Appellant that it would not pay the final two invoices.KP Engineering then filed for bankruptcy in 2019. Appellant filed an adversary proceeding against Appellee in KP Engineering’s bankruptcy proceeding, seeking to recover amounts for the unpaid invoices. The bankruptcy court dismissed Appellant's claim.On appeal, the Fifth Circuit affirmed, rejecting Appellant's quantum meruit claim, finding that it was barred by the existence of an express contract that covered the services at issue. The Fifth Circuit also rejected Appelant's unjust enrichment and breach of contract claims. View "Credos Industrial v. Targa Pipeline" on Justia Law

Plaintiff sued Uber under the Private Attorneys General Act of 2004 (PAGA), claiming Uber willfully misclassified him as an independent contractor rather than an employee, which led to numerous other Labor Code violations. In response, Uber moved to compel arbitration under the “Arbitration Provision” in the “Technology Services Agreement” (TSA).The trial court denied Uber's motion and the Second Appellate District affirmed. However, in June 2022, the U.S. Supreme Court vacated the decision when it granted Uber's petition for certiorari in light of Viking River Cruises, Inc. v. Moriana (2022) ___ U.S. ___ [142 S.Ct. 1906, 213 L.Ed.2d 179] (Viking River).Following this posture, the Second Appellate District held 1.) the TSA’s PAGA Waiver is invalid and must be severed from the Arbitration Provision; 2.) under the Arbitration Provision’s remaining terms, Plaintiff must resolve his claim for civil penalties based on Labor Code violations he allegedly suffered in arbitration, and his claims for penalties based on violations allegedly suffered by other current and former employees must be litigated in court; and 3.) under California law, Plaintiff is not stripped of standing to pursue his non-individual claims in court simply because his individual claim must be arbitrated. View "Gregg v. Uber Technologies, Inc." on Justia Law

Plaintiff filed suit against Homolka, Homolka P.A., Watts Guerra, and Watts, alleging he is owed (1) $10,000 per month as leasing payments from October 2015, the first month he stopped receiving payments, until the September 2017 settlement; (2) a promised $50,000 truck reimbursement; and (3) a $3.4 million bonus. The jury returned a unanimous verdict for Plaintiff, finding that Homolka breached the oral contract, acting as an agent of Homolka P.A. and Watts Guerra. The jury awarded $175,000 in compensatory damages with no prejudgment interest. The district court denied Watts Guerra’s renewed motion for judgment as a matter of law and Plaintiff’s motion for a new trial. Watts Guerra and Plaintiff cross-appealed these rulings.   The Eighth Circuit affirmed. The court held that it agreed with the district court that the jury reasonably found Watts Guerra liable on an ostensible agency theory for Homolka’s breaches of the contract underlying the jury’s award of $175,000 in compensatory damages. The court reasoned that in considering these issues, “we start with the assumption jurors fulfilled their obligation to decide the case correctly,” and “we defer second to the trial court, which has a far better sense of what the jury likely was thinking and also whether there is any injustice in allowing the verdict to stand.” Applying these deferential standards, the court wrote that it has no difficulty concluding the district court did not abuse its discretion in denying Plaintiff’s motion for a new trial. The jury verdict awarding $175,000 compensatory damages was neither inadequate nor the product of an inappropriate compromise. View "Lowell Lundstrom, Jr. v. Watts Guerra LLP" on Justia Law

Argonaut Insurance Company (“Argonaut”) appealed from an order of the district court remanding this breach-of-bond action, brought by LeChase Construction Services, LLC (“LeChase”), to New York state court after Argonaut removed it on the basis of diversity jurisdiction. The district court purported to issue its remand order pursuant to 28 U.S.C. Section 1447(e), which authorizes remand if, after removal, a plaintiff joins defendants whose inclusion would destroy diversity jurisdiction. The district court expressly acknowledged that section 1447(e) is facially inapplicable here, as LeChase was not seeking to join a non-diverse defendant or otherwise contesting the existence of diversity jurisdiction. Nevertheless, the district court reasoned that, since remand would facilitate this case’s consolidation with two related actions then pending in New York state court, thus conserving judicial resources and avoiding the risk of inconsistent outcomes, it was appropriate under the “rubric” of section 1447(e). At issue was: (1) whether the Second Circuit has appellate jurisdiction over the district court’s remand order notwithstanding Section 1447(d; and (2) if the court does, whether the district court issued such order in excess of its statutory authority under section 1447(e).   The Second Circuit vacated the district court’s order and remanded. The court concluded, as a matter of first impression, that “[section] 1447(d) permits appellate review of a district-court remand order that dresses in [section 1447(e)’s] jurisdictional clothing a patently non-jurisdictional ground,” such as the prudential considerations invoked by the district court here. The court concluded – for essentially the reasons acknowledged by the district court itself – that its remand order here was unauthorized under section 1447(e). View "LeChase Constr. Servs. LLC v. Argonaut Ins. Co." on Justia Law

Plaintiff appealed the district court’s decision dismissing her claims against New York University (NYU) and declining to allow her to amend her complaint to add another plaintiff. Plaintiff s a parent of an adult student who attended New York University (NYU) (Defendant-Appellee) during the Spring 2020 semester—a semester during which NYU suspended its in-person operations and transitioned to remote instruction. Alleging breach of contract, unjust enrichment, and other claims, Plaintiff brought a putative class action suit against NYU to partially recover the tuition and fees she paid for her daughter’s Spring 2020 semester. The district court granted NYU’s motion to dismiss on the basis that Plaintiff lacked standing and denied Plaintiff’s motion to amend her complaint to add a current NYU student as an additional plaintiff because it concluded that amendment would be futile.   The Second Circuit affirmed the judgment of the district court in part, vacated in part, and remanded for further proceedings. The court concluded that the district court correctly determined that Plaintiff lacks standing to bring her breach of contract and unjust enrichment claims because she has not alleged an injury-in-fact to herself, rather than to her daughter. The court held that Plaintiff fails to plausibly allege a claim for conversion. The court wrote that for these reasons, the district court properly dismissed her claims. However, the court concluded that amending the complaint to add a current student as plaintiff would not be futile. The student plaintiff plausibly alleged claims for breach of contract, unjust enrichment, and money had and received that would survive a motion to dismiss. View "Christina Rynasko v. New York University" on Justia Law