Justia Contracts Opinion Summaries

Omega filed suit against Mayo, alleging claims of fraud, negligent misrepresentation, breach of contract, and breach of the implied covenant of good faith and fair dealing. The parties had entered into an Exclusive Patent License Agreement in which Omega, a start-up company, agreed to, among other things, pursue Mayo's pending patent application. After the patent application was abandoned when the U.S. Patent and Trademark Office denied an elected group of claims as anticipated by prior art, Omega alleged damages because it relied on Mayo's pre-Agreement false representations. The court concluded that the Agreement and the patent application file squarely contradict Omega's general, conclusory allegation of reasonable reliance. Therefore, the district court properly dismissed these claims grounded in fraud for failure to state plausible claims of reasonable reliance. Accordingly, the court affirmed the judgment. View "OmegaGenesis Corp. v. Mayo Foundation" on Justia Law

This case concerned the design and construction of a single-family residence in Pitkin County, Colorado. Heritage Builders, Inc. (“Heritage”) was retained as the general contractor by the original owners of the property, Karen and Courtney Lord. Pitkin County issued a certificate of occupancy for the home in September 2006. In November 2011, Richard Goodman purchased the property from the Lords. Then, sometime between March and June 2012, Goodman discovered the alleged construction defects in the home. Goodman gave Heritage informal notice of his construction defect claims in July 2013. In this original proceeding, the issue presented for the Colorado Supreme Court’s review was whether the statute of repose in section 13-80-104(1)(a), C.R.S. (2016), barred a general contractor’s third-party claims brought in response to a homeowner’s claim for construction defects discovered in the fifth or sixth year following substantial completion of an improvement to real property. The Court held that such claims are timely, irrespective of both the two-year statute of limitations in section 13-80-102, C.R.S. (2016), and the six-year statute of repose in section 13-80-104(1)(a), so long as they are brought at any time before the ninety-day timeframe outlined in section 13-80-104(1)(b)(II). View "In re Goodman v. Heritage Builders" on Justia Law

A tour company hired an Ronald Burton ("employee") to work the tourist season as one of its representatives at a Fairbanks hotel where he had worked seasonally in the past. During training, hotel management recalled that the employee had been difficult to work with. They told the tour company they did not want him working at their hotel and, in explaining their decision, made several unfounded statements about him. When the tour company was unable to place the employee at a different hotel because of his limited transportation, it terminated his employment. The employee sued the hotel for defamation and for tortious interference with his prospective business relationship with his employer. Following a bench trial the superior court rejected the tortious interference claim based on lack of causation but found that several of the hotel’s statements were defamatory per se, justifying an award of general damages but not special or punitive damages. The court also denied the employee’s motion to amend his complaint to add a new defamation claim based on events that arose mid-trial. The employee appealed. After its review, the Alaska Supreme Court concluded: (1) the superior court did not abuse its discretion in denying the employee’s post-trial motion to amend his complaint; (2) the court did not clearly err in its application of a conditional business privilege or in its finding that the defamation did not cause the employee’s damages; and (3) the court did not clearly err in its award of damages. View "Burton v. Fountainhead Development, Inc." on Justia Law

Plaintiff filed suit against defendants, alleging fraud and conspiracy and seeking as damages the difference between the price he paid and the actual value of the restaurants he purchased from defendants based on a multiple of the restaurants' actual sales. The district court granted summary judgment for defendants, concluding that plaintiff failed to introduce adequate evidence of damages, particularly of the actual value of the restaurants at the time of the sale. The court vacated and remanded, concluding that plaintiff presented sufficient evidence to create a dispute of material fact as to the amount of their damages. In this case, plaintiff attempted to estimate with reasonable precision the actual value of the restaurants at the time of purchase, using the widely accepted income-based approach with a capitalization multiplier that was purportedly the industry standard and that the parties allegedly used to agree on the $600,000 purchase price. View "Sharma v. USA International, LLC" on Justia Law

In 1992, Shields Brothers, Inc. sued the Engelman Irrigation District, a governmental entity, alleging that Engelman had breached a contract to deliver water to Shields. Engelman alleged in its defense that it had governmental immunity. The district court denied the immunity defense, and the case proceeded to trial. A jury found damages for lost profits. The trial court rendered judgment for Shields in the amount of $271,138.80, plus interest and attorney fees. The judgment became final in 1998. The Engelman I judgment went unpaid, however, and the case continued to be litigated. In Engelman III, brought in 2010, Engelman sought a declaratory judgment that the Engelman I judgment was void under Tooke v. City of Mexia, decided by the Supreme Court in 2006. The trial court denied declaratory relief, and the court of appeals affirmed. The Supreme Court affirmed, holding (1) Tooke applies only narrowly to judgments still being challenged on direct appeal and does not apply broadly to all prior final judgments; and (2) therefore, the long-final judgment in this case cannot be upended via collateral attack. View "Engelman Irrigation District v. Shields Brothers, Inc." on Justia Law

This action stemmed from Defendants’ financing of Plaintiffs’ real property located in Wyoming and California. Plaintiffs filed this action in Wyoming against Defendants alleging breach of contract, fraud in the inducement, and violation of a California law governing fraudulent business practices. Plaintiffs sought monetary and punitive damages, rescission and restitution, and an order declaring all encumbrances recorded against their Wyoming property void and expunged. After applying Wyoming law, the district court granted Defendants’ motions to dismiss and for judgment on the pleadings, concluding that Plaintiffs’ breach of contract claims were barred by the statute of frauds and that Plaintiffs failed to plead their fraud and fraud-based claims with the particularity required by Wyo. R. Crim. P. 9(b). View "Elworthy v. First Tennessee Bank" on Justia Law

In 2004, Deborah and Brian Blackmon executed an agreement establishing a home-equity line of credit with Renasant Bank secured by a mortgage on the Blackmons' house. In addition to making withdrawals on the home-equity line of credit, the Blackmons also made payments on the home-equity line of credit during that time. In 2013, Brian Blackmon died. Following Brian’s death, Deborah made five separate payments on the home equity line of credit. The payments made did not satisfy the entirety of the money the Blackmons owed Renasant Bank under the terms of the home-equity line of credit, and Deborah failed to make any additional payments. Deborah denied that she had executed the home-equity line of credit or the mortgage and, thus, denied liability for any outstanding balance due under the home-equity line of credit. Renasant Bank sued Deborah and the estate seeking a judgment declaring that the Blackmons had executed the agreement establishing a home-equity line of credit with Renasant Bank and a mortgage on the Blackmons' house securing the home-equity line of credit and asserting a claim of breach of contract seeking to recover the amount of money owed under the terms of the home-equity line of credit. Deborah and the estate filed an answer to Renasant Bank's complaint and asserted a counterclaim, requesting a judgment declaring that the mortgage on the Blackmons' house was not enforceable. The trial court granted partial summary judgment in favor of the bank and the Blackmons appealed. After review, the Supreme Court dismissed this appeal as the Blackmons’ appeal was of a nonfinal judgment. View "Blackmon v. Renasant Bank" on Justia Law

Thomas and Elizabeth Edgar entered into a lease agreement with Boyd and Merlyn Mills concerning land in Faulk County. Under the belief that he had an option to purchase the real estate at the conclusion of the lease term, Thomas Edgar later contacted an attorney to prepare a warranty deed so that the Millses could convey the real estate to the Edgars. After the Edgars’ attempts to execute the deed with the Millses failed, the Edgars sued the Millses for specific performance. The Millses counterclaimed, alleging that the Edgars breached the lease agreement. The trial court found the lease agreement ambiguous and considered parol evidence. The court ultimately concluded that the parties intended the lease agreement to be a lease with an option to purchase and ordered specific performance compelling the Millses to execute a warranty deed in favor of the Edgars. The Supreme Court reversed in part and remanded, holding (1) the trial court erred when it interpreted the parties’ agreement to be ambiguous and when it directed the Millses to execute a warranty deed in favor of the Edgars; and (2) under the lease, the Millses were entitled to reimbursement of their reasonable attorney’s fees incurred by reason of the Edgars’ breach of the lease agreement. View "Edgar v. Mills" on Justia Law

Turnoy sold insurance to Shiner’s in‐laws for decades. After Shiner, a Chicago lawyer, demanded that Turnoy split commissions on their new policies, Turnoy sent him a check for $149,000. Rejecting $149,000 as too little, Shiner sued for breach of contract, then brought another suit, alleging tax fraud, 26 U.S.C. 7434, by reporting to the IRS the $149,000 as income to Shiner; Shiner had not cashed the check. The judge ordered Turnoy to pay Shiner damages of $16,000 for fraud. The Seventh Circuit reversed, noting that the state court rejected Shiner’s breach of contract claim before the district court’s decision. Turnoy had placed a restrictive endorsement on the back of the check, stating that by cashing the check Shiner accepted $149,000 as full payment. U.S. Treasury regulations provide that a check received but not cashed counts as income for tax purposes only if “credited or set apart to a person without any substantial limitation or restriction as to the time or manner of payment or condition upon which payment is to be made,” but Shiner neither asked for a new check nor otherwise communicated rejection of the check. Shiner’s inaction gave Turnoy a solid basis for believing that Shiner had accepted the check, so Turnoy’s filing of Form 1099 was not “willfully … fraudulent.” View "Shiner v. Turnoy" on Justia Law

Plaintiff-Appellant Suture Express, Inc. appeals from the district court’s entry of summary judgment in favor of Cardinal Health 200, LLC (“Cardinal”) and Owens & Minor Distribution, Inc. (“O&M”) under Section 1 of the Sherman Antitrust Act, Section 3 of the Clayton Act, and the Kansas Restraint of Trade Act (“KRTA”). Suture Express, Cardinal, and O&M compete in the national broadline medical-and-surgical (“med-surg”) supply and distribution market. After Suture Express entered the "suture-endo" market and steadily grew its market share, Cardinal and O&M responded by instituting bundling packages in their contracts. Suture Express sued Cardinal and O&M, alleging that their bundling arrangements constituted an illegal tying practice in violation of federal and state antitrust laws. The court held that Suture Express’s federal claims failed as a matter of law because it could not establish that either Cardinal or O&M individually possessed sufficient market power in the other-med-surg market that would permit it to restrain trade in the suture-endo market. Even were this not the case, however, the court also held that: (1) Suture Express could not establish antitrust injury because it had not shown that competition itself had been harmed; and (2) Cardinal and O&M cited sufficient procompetitive justifications for the bundling arrangement to overcome any harm caused by any anticompetitive effects resulting from the bundle. Viewing the evidence in the light most favorable to Suture Express, the Tenth Circuit did not think the company could survive summary judgment under Section 1 of the Sherman Act, Section 3 of the Clayton Act, or the Kansas Restraint of Trade Act. "There simply is not enough probative evidence by which a reasonable jury could find that Cardinal’s and O&M’s bundling arrangement unreasonably restrained trade in violation of federal or state antitrust law." View "Suture Express v. Owens & Minor" on Justia Law