Justia Contracts Opinion Summaries

Hemlock and Sachsen manufacture components of solar-power products. They entered into a series of long-term supply agreements (LTAs), by which Hemlock in Michigan would supply Sachsen in Germany with set quantities of polycrystalline silicon (polysilicon) at fixed prices from 2006-2019. The market price of polysilicon was initially well above the LTA price, but the market price plummeted after the Chinese government began subsidizing its national production of polysilicon. The parties reached a temporary agreement to lower the LTA price in 2011. When that agreement expired, Hemlock demanded that Sachsen pay the original LTA price for 2012. Sachsen refused. Hemlock sued for breach of contract. The district court granted Hemlock summary judgment and awarded nearly $800 million in damages and prejudgment interest. The Sixth Circuit affirmed. The district court: properly struck Sachsen’s antitrust defense because enforcing the take-or-pay provision does not require the parties to engage in the precise conduct that is allegedly unlawful; properly struck Sachsen’s defense that the LTAs illegally tied Sachsen’s predominant demand for polysilicon to a single seller in violation of E.U. antitrust law; properly concluded that Sachsen’s affirmative defenses of commercial impracticability and frustration of purpose lack merit; and properly awarded the full amount of the remaining contract price as liquidated damages, despite Sachsen’s argument that the award was an unreasonable penalty. View "Hemlock Semiconductor Operations, LLC v. SolarWorld Industries Sachsen GMBH" on Justia Law

Gerboc used the Wish Marketplace website to buy portable speakers for $27. Sellers on Wish can include a Manufacturer’s Suggested Retail Price, which appears (crossed-out) on a product’s “detail page.” Gerboc saw “$300” next to the speakers’ purchase price. Gerboc believed the crossed-out price was a promise of a 90% markdown but the speakers allegedly never sold for $300. Gerboc decided that he never received the promised discount and filed suit on behalf of himself and a class of similarly situated buyers. Arguing that Wish’s price visuals are deceptive, he alleged breach of contract, unjust enrichment, fraud, and violations of the Ohio Consumer Sales Practices Act (OCSPA). ContextLogic removed to federal court under the Class Action Fairness Act, 28 U.S.C. 1332(d). Gerboc abandoned his contract claim; the court dismissed his unjust enrichment, fraud, and class OCSPA claims. The Sixth Circuit affirmed. Gerboc did not establish unjust enrichment; he got what he paid for. Nor did he establish the notice element of an OCSPA claim: The consumer must show either that the Ohio Attorney General had already “declared [the seller’s practice] to be deceptive or unconscionable” or that an Ohio court had already “determined [the practice] . . . violate[s] [the OCSPA]” before the seller engaged in it. View "Gerboc v. ContextLogic, Inc." on Justia Law

Plaintiff Dennis Ponte demanded defendant County of Calaveras (County) to pay him over $150,000 to reimburse him for work purportedly performed on the County’s behalf pursuant to an oral contract. The contract did not contain any fixed payment, and no bid was submitted nor approved pursuant to relevant county ordinances governing public contracts. Ponte disregarded opportunities to abandon his claims after the County provided him with pertinent legal authority demonstrating that his claims lacked merit. After multiple sustained demurrers, the trial court granted summary judgment to the County on Ponte’s third amended complaint. The court later awarded substantial attorney fees, finding Ponte’s claims, including those based on promissory estoppel, were not brought or maintained in both subjective and objective good faith. Ponte appealed. Finding no reversible error, the Court of Appeal affirmed. View "Ponte v. County of Calaveras" on Justia Law

The Eighth Circuit affirmed the district court's grant of summary judgment for CIC on the Trust's claims for breach of contract, vexatious refusal, and declaratory judgment. The court held that the district court properly afforded the appraisal provision its plain meaning in determining it was unambiguous, enforceable, and did not abridge the Trust's rights under Missouri's vexatious refusal statute; the district court properly concluded CIC did not waive the appraisal provision; the Trust's contention that there was no basis for the district court to order appraisal of all covered damages, including replacement cost, was unfounded; the district court committed no error in finding the Trust's breach of contract claim failed as a matter of law; and the district court properly granted CIC summary judgment on the Trust's vexatious refusal claim. View "Olga Despotis Trust v. Cincinnati Insurance Co." on Justia Law

Former Howmedica Sales Representatives, all California natives, signed employment agreements with confidentiality, non-compete, and forum-selection clauses, designating New Jersey (or Michigan) as the forum for any litigation arising out of the agreements. After clashes with Howmedica, the Sales Representatives resigned and became independent contractors representing Howmedica’s competitor, DePuy. Some of Howmedica’s customers, previously assigned to the Sales Representatives, followed them. Howmedica suspected that the Sales Representatives and DePuy conspired to convert those customers before the Sales Representatives’ resignations. Howmedica filed suit in New Jersey, joining DePuy’s regional distributor, Golden State as a “necessary party.” The defendants successfully moved to transfer the case to California under 28 U.S.C. 1404(a), which, for “the convenience of parties and witnesses” and “in the interest of justice,” allows transfer to a district where the case “might have been brought.” The Third Circuit directed the district court to transfer claims against only the two corporate defendants who did not agree to any forum-selection clause. Where contracting parties have specified the forum in which they will litigate disputes arising from their contract, federal courts must honor the forum-selection clause “[i]n all but the most unusual cases.” In this case, all defendants sought transfer to one district; some, but not all, defendants are parties to forum-selection clauses. View "In re: Howmedica Osteonics Corp" on Justia Law

A tree fell on Kaitlyn and Joshua. Kaitlyn died. She was pregnant. Doctors delivered the baby, but he died an hour later. Joshua survived with serious injuries. A state jury found the Somerset Housing Authority liable and awarded $3,736,278. The Authority belonged to the Kentucky Housing Authorities Self-Insurance Fund, which provided a policy with Evanston. Evanston sought a declaratory judgment limiting its liability under the Fund’s policy to $1 million. Meanwhile, through mediation of the state court case, Evanston agreed to pay the “policy limits” in return for an agreement to dismiss the state court action and release the Authority from further liability. Evanston claimed that $1 million was the coverage cap; the defendants claimed it was $2 to $4 million. The district court determined that there was complete diversity and ruled for Evanston on the merits. The Sixth Circuit affirmed. The district court properly aligned the parties given their respective interests in the primary dispute at the time of filing, so that diversity jurisdiction was not destroyed. The policy obligates Evanston to provide a maximum of $1 million of coverage per “occurrence,” with an aggregate limit of $2 million for more than one occurrence. The contract defines “occurrence” as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions.” When one tree falls at one time, that is one occurrence and one accident. View "Evanston Insurance Co. v. Housing Authority of Somerset" on Justia Law

The Eighth Circuit affirmed the district court's grant of summary judgment to JRMC in this breach of contract suit and the district court's subsequent award of $64,931.81 to JRMC. The court held that the documents executed in connection with defendant's employment at JRMC should be considered separately: the Recruitment Agreement and the Employment Agreement; defendant's obligation to pay the remaining debt under a promissory note was not excused by his allegations of fraud or breach of the duty of good faith, as well as breach of contract and personal injury; the terms of the note control and the note provided that defendant agreed to pay all costs and expenses incurred by JRMC in connection with the collection and enforcement of the note; and the district court did not abuse its discretion with respect to the award of attorney's fees. View "Johnson Regional Medical Center v. Halterman" on Justia Law

Property owners who purchased through a foreclosure sale sued the bank that sold the house, alleging that they were mislead the bank’s deed of trust was the first deed of trust, when another remained on the property, and was not extinguished by the foreclosure sale. Wells Fargo assigned any claim against the title insurer it had to David and Lina Hovannisian (the property owners), and the Hovannisians sued First American Title Insurance Company, alleging breach of contract, negligent misrepresentation and breach of the implied covenant of good faith and fair dealing. First American moved for summary judgment, arguing its title insurance coverage had terminated, and no benefits were due. The motion was granted, and the Hovannisians appealed, arguing First American failed to establish that coverage did not continue under the title policy or there were no benefits due under the policy. They also contended triable issues of fact existed regarding their bad faith claim. The Court of Appeal affirmed, finding First American showed, based on the facts Wells Fargo and the Hovannisians presented before and after the underlying action was filed, that there was no potential for coverage under the policy. The Hovannisians did not learn about the first deed of trust until after they purchased the property at the foreclosure sale without warranty. Thus, the only potential claim they had against Wells Fargo was for the alleged misrepresentations for which there was no liability or loss under the policy. View "Hovannisian v. First American Title Ins. Co." on Justia Law

Daphne Automotive, LLC, and its employee, Robin Sanders appealed a circuit court order denying their motion to compel arbitration of the claims filed against them by Eastern Shore Neurology Clinic, Inc. ("Eastern Shore"), and Rassan Tarabein. Tarabein owned Eastern Shore and another company, Infotec, Inc. Tarabein hired his nephew, Mohamad Tarbin, as an employee of Infotec. As part of the nephew's compensation, Tarabein agreed to provide him with the use of a vehicle for as long as he was employed with Infotec. Accordingly, Tarabein purchased, through Eastern Shore, a vehicle from Daphne Automotive. Tarabein, the nephew, and the dealership agreed that the dealership would arrange for the vehicle to be titled in the nephew's name, but that Eastern Shore would be listed on the title as lienholder. In conjunction with the sale, the nephew signed the sales contract, which contained an arbitration clause. Tarabein executed only the documents to establish Eastern Shore as lienholder on the title for the vehicle. In January 2014, the Department of Revenue issued an original certificate of title for the vehicle that listed no lienholders to the nephew. A few months later, the nephew was terminated from his job with Infotec, and Tarabein attempted to take back the vehicle, but the nephew refused. According to Tarabein, the dealership never informed him that it had failed to list Eastern Shore as a lienholder on the application for the certificate of title. As a result, the nephew held title to the vehicle free and clear, and Eastern Shore held a reissued certificate of title for the same vehicle, listing it as lienholder. Eastern Short attempted to repossess the vehicle; the nephew avoided being arrested by producing the free-and-clear title to the vehicle. According to Tarabein, he became aware of the existence of the second certificate of title after the attempted arrest. Tarabein thereafter sued the dealership for a variety of claims; the dealer moved to compel arbitration. The Alabama Supreme Court concluded the dealership failed to meet its burden of proving the existence of a contract calling for arbitration: the sales contract was limited in its scope with respect to disputes arising to parties to the contract and the agreements, here, between the nephew and the dealership. Accordingly, the Court found the trial court did not err in denying the dealership’s motion to compel arbitration. View "Daphne Automotive, LLC v. Eastern Shore Neurology Clinic, Inc." on Justia Law

FC Surety posted $150,000 bail to secure Ventura‘s release from custody in San Francisco. On September 15, 2014, when Ventura failed to appear, the court issued a bench warrant and declared the bond forfeited, stating FC‘s obligation to pay the bond would become absolute on April 10, 2015. On March 12, FC‘s agent discovered Ventura was in custody in Contra Costa County and tried to surrender the San Francisco warrant and have Ventura held. The Contra Costa County Sheriff found no active warrants, although the agent had verification from the San Francisco Sheriff. On April 3, the bail agent moved to vacate the forfeiture and exonerate the bond, arguing that failure to enter the warrant into the National Crime Information Center was an error that required exoneration of liability on the bond under Penal Code 980(b). The court denied the motion because the bench warrant remained outstanding. The agent then, unsuccessfully, orally requested to extend the time to secure Ventura‘s appearance. On August 19, the court issued summary judgment of bail forfeiture. The court of appeal reversed in favor of FC. FC‘s motion was timely and supported by good cause; under Penal Code 1305(c)(3) a court “shall vacate the forfeiture and exonerate the bail” if, outside the county where the case is located, the defendant is surrendered to custody by the bail or is arrested in the underlying case. View "P.eople v. Financial Casualty & Surety" on Justia Law