Justia Contracts Opinion Summaries

This appeal arose out of a breach-of-contract action between Marc Daniels, Sandra Daniels, Crocker & Associates, Inc., and Maxx Investments, LLC (collectively, “the Danielses”) and Dennis Crocker, Gail Crocker and Crocker, Ltd. (collectively, “the Crockers”). The Danielses entered into an Asset Purchase Agreement (the “Agreement”) with the Crockers to acquire Crocker & Associates, Inc. (“C&A”). Within eighteen months of the sale, C&A lost a number of important contracts and its employees resigned. The Danielses sued the Crockers for failing to disclose all material information about C&A as required by the Agreement. The Crockers answered the suit and brought counterclaims. After extensive discovery, the trial court granted the Crockers’ motion for summary judgment on the Danielses’ claims against them. The Danielses now appeal the trial court’s grant of summary judgment. Because the record contained a genuine issue as to material fact concerning the Danielses’ contract claims and negligent and fraudulent misrepresentation claims, the Mississippi Supreme Court concluded the trial court erred in granting summary judgment on these claims. Further, because the Court remanded these claims for a jury to determine if the Danielses were entitled to compensation, the Court reversed the trial court’s grant of summary judgment on the punitive damages claim. The Court affirmed in all other respects, and remanded the case for further proceedings. View "Daniels v. Crocker" on Justia Law

Corey worked as a machine operator in Eaton’s Ohio factory. Corey has long suffered from cluster headaches— extremely painful attacks that strike several times per day for weeks on end. In 2014, Corey applied for short-term disability benefits under Eaton’s disability plan after a bout of headaches forced him to miss work. After granting a period of disability, the third party administering Eaton’s disability plan discontinued benefits because Corey failed to provide objective findings of disability. Under the plan, “[o]bjective findings include . . . [m]edications and/or treatment plan.” Corey’s physicians treated his headaches by prescribing prednisone, injecting Imitrex (a headache medication), administering oxygen therapy, and performing an occipital nerve block. The district court upheld the denial. The Sixth Circuit reversed, citing the Employee Retirement Income Security Act, 29 U.S.C. 1132(a)(1)(B). Corey’s medication and treatment plan satisfy the plan’s objective findings requirement. View "Corey v. Sedgwick Claims Management Services, Inc." on Justia Law

Defendant was charged with larceny in the third degree as an accessory and conspiracy to commit larceny in the third degree. Defendant moved to dismiss the charges on the basis of the State’s prior entry of a nolle prosequi on the same charges. The trial court denied the motion to dismiss. The appellate court reversed on the ground that the entry of a nolle on those charges and nolles on charges in three other cases was part of an agreement between the State and Defendant contemplating a global disposition supported by consideration. Therefore, the appellate court concluded that Defendant’s prosecution in the present proceeding was barred. The Supreme Court affirmed, holding that the agreement was ambiguous as to the parties’ intent and therefore must be construed in Defendant’s favor as a global disposition. View "State v. Kallberg" on Justia Law

The Federal Arbitration Act does not preempt all state arbitration law. A party alleging an arbitration agreement is unconscionable must demonstrate some quantum of both procedural and substantive unconscionability. A party's failure to clearly object to a defect in arbitration proceedings prior to or during arbitration may constitute a waiver of the objection. Lynne Thompson appealed a district court order compelling arbitration, a judgment confirming the arbitration award, and an order denying her motion to vacate the judgment or for a new trial. Thompson sued Lithia ND Acquisition Corp. #1, seeking to rescind a contract to purchase a vehicle and for damages for unjust enrichment and unlawful sales practices. Lithia moved to dismiss Thompson's complaint and to compel arbitration, arguing there was an enforceable agreement to arbitrate. Thompson responded to the motion, arguing the arbitration agreement was unenforceable and unconscionable and claiming she was entitled to a jury trial on the issue of the enforceability. The North Dakota Supreme Court affirmed, concluding the district court did not err in compelling arbitration or confirming the arbitrator's award. View "Thompson v. Lithia ND Acquisition Corp. #1" on Justia Law

An indemnification agreement need not be in writing, and an agent's authority to enter into an indemnification agreement need not be in writing. Jim Leach (“Leach”) and Elizabeth Leach appealed a district court judgment awarding money damages to SNAPS Holding Company after ruling they breached a stock purchase agreement with SNAPS. SNAPS cross-appealed the dismissal of its breach of contract claims against Leach. Leach was the chief operating officer and majority shareholder of IDA of Moorhead Inc. Leach negotiated with Sanjay Patel, president and CEO of SNAPS, to sell IDA to SNAPS. During negotiations the parties discussed the effect of an employee lawsuit on the potential sale. The parties agreed SNAPS would be responsible for the first $100,000 of expenses associated with the lawsuit, and Jim Leach and IDA would be responsible for that portion exceeding $100,000. At a shareholders and board of directors meeting, the IDA shareholders and board of directors authorized the sale of IDA's stock to SNAPS for $1,180,000. A district court ruled IDA wrongfully terminated the employee and Leach breached a fiduciary duty. Leach and the selling shareholders of IDA refused to pay the employee lawsuit judgment. The employee filed the judgment against Leach in Arizona, and subsequently assigned the judgment to SNAPS and IDA. Leach objected to the filing of the judgment against him in Arizona. An Arizona court ruled SNAPS and IDA could not enforce the judgment against Leach in Arizona. The court concluded SNAPS exercised total control over the management and activities of IDA and was the alter ego of IDA. The Arizona court concluded both Arizona and North Dakota law prohibited contribution between intentional joint tortfeasors; therefore, allowing IDA to obtain contribution from Leach, its co-intentional joint tortfeasor, was prohibited in Arizona. SNAPS sued Leach and the other former IDA shareholders after they failed to pay the employee judgment. The North Dakota Supreme Court concluded the proceeding in Arizona relating to the filing of the employee judgment and SNAPS' lawsuit in North Dakota relating to the stock purchase agreement were based on different factual circumstances, and as such, not barred by res judicata. The Court reversed and remanded that part of the district court's order granting summary judgment in favor of Jim Leach that found otherwise. The Court also reversed and remanded that part of the judgment dismissing SNAPS' claims against Jim Leach. The Court affirmed in all other respects. View "SNAPS Holding Company v. Leach" on Justia Law

Dos Lagos, LLC and Mellon Valley, LLC defaulted on a loan in which Utah First Federal Credit Union owned a fifty-two percent interest and RADC/CADC Venture, LLC (RADC) owned a forty-eight percent interest. Utah First filed a deficiency action against Dog Lagos, Mellon Valley, and several guarantors (collectively, Dos Lagos). After the statute of limitations had expired, Utah First filed an emended complaint adding RADC as a party plaintiff. The district court awarded RADC the full amount of the loan, concluding that the amended complaint related back to the date of the original complaint under Utah R. Civ. P. 15(c). The court of appeals affirmed. The Supreme Court affirmed, holding that the court of appeals did not err when it found that RADC’s claim was not time barred and awarded RADC the full deficiency amount. View "2010-1 RADC/CADC Venture, LLC v. Dos Lagos, LLC" on Justia Law

The Colorado Supreme Court concluded here that nothing in the language of the Colorado uninsured/underinsured motorist statute, 10-4-609 C.R.S. (2016) precluded an agent from exercising either apparent or implied authority to reject UM/UIM coverage on behalf of a principal. In line with this reasoning, the agent’s rejection of UM/UIM coverage was indeed binding on the principal. Respondent Brian Johnson tasked a friend with purchasing automobile insurance for the new car that he and the friend had purchased together. The friend did so, and in the course of that transaction, she chose to reject uninsured/underinsured motorist (UM/UIM) coverage on the new car. After an accident in that car with an underinsured motorist, Johnson contended that his friend’s rejection of UM/UIM coverage was not binding on him. View "State Farm v. Johnson" on Justia Law

In 2009, RNB and GAF entered into an agreement under which GAF would promote RNB’s “Roof N Box” product, a three-dimensional roofing model, to building construction contractors affiliated with GAF. The agreement required the parties to submit disputes “arising under” the agreement to arbitration. GAF terminated the agreement after about a year. In 2016, RNB, together with its founder and president, Evans, brought suit against GAF based on GAF’s activities in marketing its own product that competes with the Roof N Box. The complaint alleged design patent infringement, trade dress infringement, and unfair competition. GAF moved to dismiss or stay the action pending arbitration. The district court denied that motion. The Federal Circuit affirmed, stating that GAF’s assertion that the arbitration provision covers the claims stated in the complaint is “wholly groundless.” The complaint challenges actions whose wrongfulness is independent of the 2009 agreement’s existence. View "Evans v. Building Materials Corp." on Justia Law

This dispute between two businesses led to Plaintiff filing suit in federal court alleging various claims under Massachusetts law, two of which remained at issue on appeal. Those two claims were for breach of implied contract and violation of the Massachusetts catch-all consumer protection statute, Mass. Gen. Laws ch. 93A. The district court denied Defendant’s motion for judgment as a matter of law on Plaintiff’s implied contract claims and on its chapter 93A claims. The jury found Defendant liable for breach of implied contract and for knowing and willful violation of chapter 93A. The First Circuit affirmed, holding (1) the evidence in the record was sufficient to sustain the jury’s verdict; and (2) Defendant offered no meritorious argument for why the district court erred in submitting Plaintiff’s chapter 93A claim for damages to a jury in federal court. View "Full Spectrum Software, Inc. v. Forte Automation Systems, Inc." on Justia Law

Defendant Extreme Contracting, LLC appealed a trial court’s order granting a default judgment to plaintiff Hermitage Inn Real Estate Holding Co., LLC in a contract dispute. The court held defendant responsible for enforcing a mandatory arbitration clause in the parties’ contract and ordered defendant to “initiate” arbitration by a certain date. When defendant failed to do so, the court considered this a failure to obey a “scheduling order” under Vermont Rule of Civil Procedure 16.2, and as a sanction, it granted a default judgment to plaintiff under Rule 37(b)(2)(C). Defendant argued, among other things, that a default judgment was inappropriate here. It contended that the court should have granted its motion to dismiss plaintiff’s suit given the mandatory arbitration provision, and that as the defendant, it should not have been required to “initiate” arbitration. It also argued that the court erred in denying its motion to vacate the default judgment. After review, the Vermont Supreme Court agreed the court erred, and based on that order ultimately granted a sanction unsupported by the facts and the law. The Court reversed the trial court’s decision and remanded for entry of an order requiring plaintiff to initiate arbitration or face dismissal of its suit. View "Hermitage Inn Real Estate Holding Co., LLC v. Extreme Contracting, LLC" on Justia Law