Justia Contracts Opinion Summaries

The Court of Chancery dismissed Plaintiff's complaint for declaratory relief and injunctive relief against the City Library of Wilmington for failure to state a claim, holding that the complaint failed to state a claim for breach of contract.After Plaintiff was banned from various sections of the Library, he filed this complaint seeking to enjoin the Library from banning him and from suspending his privileges. Plaintiff further sought to induce the Library to enforce Library regulations and asked that the Court "rewrite the organizational chart of the Library." The Library filed a motion to dismiss the complaint. The Court of Chancery granted the motion, holding that Plaintiff's count for breach of contract did not state a claim on which relief could be granted. View "Brown v. City Library of Wilmington" on Justia Law

Travelex filed suit against defendant to enforce an alleged agreement restricting her ability to compete with Travelex by soliciting business from certain customers. The district court granted partial summary judgment in favor of defendant, determining that the purported agreement was unenforceable.The Eighth Circuit reversed and remanded, holding that summary judgment was not warranted. In this case, the district court concluded that the agreement was unenforceable because the 2008 agreement became a nullity when Travelex was acquired by Cover-More and defendant refused to sign a new agreement as a condition of continued employment and was terminated. The court held that defendant's refusal to sign the new agreement nullified the prior agreement. The court also held that defendant's alternative argument, that under New York law restrictive covenants may not be enforced when an employee is dismissed without cause, does not apply because the non-solicitation agreement is not unreasonable as a matter of law. View "Travelex Insurance Services, Inc. v. Barty" on Justia Law

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

In 1998, Bay and Oxbow entered into a limestone supply contract, agreeing to resolve any disputes according to specified “Dispute Resolution Procedures.” Oxbow began to provide lower quality limestone that posed a danger to Bay’s equipment. Bay agreed to pay—under protest—a price in excess of that permitted by the contract for adequate limestone. Negotiations and mediation failed. Bay filed a demand for arbitration. An arbitration panel unanimously held that Oxbow had breached the contract and awarded nearly $5 million in damages, costs, and interest. The panel did not award attorneys’ fees, concluding that the Dispute Procedures expressly deny it the jurisdiction to do so. The district court confirmed the award, agreeing that the contract did not permit the prevailing party to recover its attorneys’ fees.The Sixth Circuit reversed. The Procedure authorizing the allocation of costs states,“(but excluding attorneys’ fees which shall be borne by each party individually). The provision immediately following that grants the prevailing party a right to attorneys’ fees and another provision refers to attorneys’ fees. Those provisions can either be read together to permit the recovery of attorneys’ fees in court but not before an arbitration panel, or they are hopelessly contradictory and unenforceable. Bay presents a reasonable construction of the terms to harmonize them. View "Bay Shore Power Co. v. Oxbow Energy Solutions, LLC" on Justia Law

The First Circuit vacated the decision of the district court dismissing Plaintiff's breach of contract claim, holding that the court erred in concluding that Plaintiff did not assert a breach of contract claim and abused its discretion when it employed the Fed. R. Civ. P. 12(b)(6) standard in dismissing the breach of contract claim instead of the summary judgment standard.Plaintiff filed a breach of contract action and asserted a secondary theory of liability related to deceit or "dolo." Defendant moved for summary judgment. The district court granted summary judgment for Defendant but dismissed the breach of contract claim under Fed. R. Civ. P. 12(b)(6) for failure to state a claim to relief that was "plausible on its fact." Applying the test for deceit in the formation of the contract, the court found that Plaintiff was not entitled to relief. The First Circuit vacated the judgment in part, holding that the district court (1) erred in concluding that Plaintiff did not assert a breach of contract claim and abused its discretion when it evaluated Defendant's motion for summary judgment with respect to the claim as if were a Rule 12(b)(6) motion to dismiss; and (2) did not err in granting summary judgment as to Plaintiff's fallback theory of dolo. View "Feliciano-Munoz v. Rebarber-Ocasio" on Justia Law

Coinbase is an online digital currency platform that allows customers to send, receive, and store certain digital currencies. Archer opened a Coinbase account to purchase, trade, and store cryptocurrency. On October 23, 2017, a third party launched a new cryptocurrency, “Bitcoin Gold,” Coinbase monitored and evaluated Bitcoin Gold’s network and informed its customers via its website: “ ‘At this time, Coinbase cannot support Bitcoin Gold because its developers have not made the code available to the public to review. This is a major security risk.’ ” In 2018, the Bitcoin Gold network was attacked by hackers who stole millions of dollars of funds from trading platforms and individuals on its network.Archer sued Coinbase, based on Coinbase’s failure and refusal to allow him to receive his Bitcoin Gold currency and Coinbase’s retention of control over his Bitcoin Gold. The trial court rejected his claims of negligence, conversion, and breach of contract on summary judgment. The court of appeal affirmed. Archer failed to establish the existence of an agreement by Coinbase to provide the Bitcoin Gold to him and failed to demonstrate Coinbase acted in any way to deprive him of his Bitcoin Gold currency. View "Archer v. Coinbase, Inc." on Justia Law

JDC sought a preliminary injunction against its former employee for breach of a non-compete agreement. The district court denied the motion for a preliminary injunction in all its parts and with no concessions.The Fifth Circuit held that the district court, after acknowledging the agreement to be overbroad, erred in declining to adjudicate reformation of the agreement. In this case, the district court should have considered reformation of the agreement in the process of deciding the preliminary injunction motion. Accordingly, the court vacated and remanded to the district court to allow relevant evidence and argument from the parties concerning reformation. Furthermore, the court noted that the district court should then decide what reformation, if any, would be reasonable under Texas law, and proceed to adjudicate the preliminary injunction motion in the light of its findings on reformation. View "Calhoun v. Jack Doheny Companies, Inc." on Justia Law

Plaintiffs Rafi Ghazarian and Edna Betgovargez had a son, A.G., with autism. A.G. received applied behavior analysis (ABA) therapy for his autism under a health insurance policy (the policy) plaintiffs had with defendant California Physicians’ Service dba Blue Shield of California (Blue Shield). Mental health benefits under this policy are administered by defendants Magellan Health, Inc. and Human Affairs International of California (collectively Magellan). By law, the policy had to provide A.G. with all medically necessary ABA therapy. Before A.G. turned seven years old, defendants Blue Shield and Magellan approved him for 157 hours of medically necessary ABA therapy per month. But shortly after he turned seven, defendants denied plaintiffs’ request for 157 hours of therapy on grounds only 81 hours per month were medically necessary. Plaintiffs requested the Department of Managed Health Care conduct an independent review of the denial. Two of the three independent physician reviewers disagreed with the denial, while the other agreed. As a result, the Department ordered Blue Shield to reverse the denial and authorize the requested care. Plaintiffs then filed this lawsuit against defendants, asserting breach of the implied covenant of good faith and fair dealing against Blue Shield, and claims for intentional interference with contract and violations of Business and Professions Code section 17200 (the UCL) against defendants. Defendants each successfully moved for summary judgment. As to the bad faith claim, the trial court found that since one of the independent physicians agreed with the denial, Blue Shield acted reasonably as a matter of law. As to the intentional interference with contract claim, the court found no contract existed between plaintiffs and A.G.’s treatment provider with which defendants could interfere. Finally, the court found the UCL claim was based on the same allegations as the other claims and thus also failed. After its review, the Court of Appeal concluded summary judgment was improperly granted as to the bad faith and UCL claims. "[I]t is well established that an insurer may be liable for bad faith if it unfairly evaluates a claim. Here, there are factual disputes as to the fairness of defendants’ evaluation. . . .There are questions of fact as to the reasonability of these standards. If defendants used unfair criteria to evaluate plaintiffs’ claim, they did not fairly evaluate it and may be liable for bad faith." Conversely, the Court found summary judgment proper as to the intentional interference with contract claim because plaintiffs failed to show any contract with which defendants interfered. View "Ghazarian v. Magellan Health" on Justia Law