Justia Contracts Opinion Summaries

The Michigan office of Alix, an international company, administers payroll and benefits for U.S. employees and is directly involved in U.S. hiring. In 2013, Alix hired Brewington, a Texas resident, for its Dallas Corporate Services team. The employment agreement provides that it “will be construed and interpreted in accordance with the laws of the State of Michigan” and states, “any dispute arising out of or in connection with any aspect of this Agreement and/or any termination of employment . . ., shall be exclusively subject to binding arbitration under the . . . American Arbitration Association . . . decision of the arbitrator shall be final and binding as to both parties.” In 2014, Brewington was terminated. He filed a demand for arbitration, asserting claims under Title VII, 42 U.S.C. 2000e, on behalf of himself and a purported nationwide class of current, former, and potential Alix employees. The Michigan district court ruled that Brewington was precluded from pursuing arbitration claims on behalf of any purported class. The Sixth Circuit affirmed that court’s refusal to dismiss, finding that Brewington had sufficient contacts with Michigan to establish personal jurisdiction, and upheld summary judgment in favor of Alix. An agreement must expressly include the possibility of classwide arbitration to indicate that the parties agreed to it. This clause is silent on the issue and is limited to claims concerning “this Agreement,” as opposed to other agreements. It refers to “both parties.” View "AlixPartners, LLP v. Brewington" on Justia Law

The principal issue in this appeal is whether the district court correctly determined the measure of compensation due to Noteholders, represented by BNY Melon, arising from the underpayment to the Noteholders by Chesapeake in connection with Chesapeake's early redemption of the Notes. The court concluded, substantially for the reasons set forth in the district court's thorough opinion, that the district court correctly determined the measure of compensation due to the Noteholders in the circumstances presented. In this case, applying New York law, Section 1.7 of the Supplemental Indenture - a contract Chesapeake does not contend was invalid or unenforceable - dictates the Noteholders’ recovery arising from Chesapeake’s underpayment for its May 13, 2013 redemption. Because Chesapeake completed its redemption on May 13, 2013, it owed the Noteholders the Make‐Whole Price for that redemption, pursuant to Section 1.7(c), and it breached the Supplemental Indenture by paying only the At‐Par Price. The court agreed with the district court that the correct damages award was the difference between the At‐Par Price and the Make‐Whole Price, plus prejudgment interest. To hold otherwise would frustrate the Noteholders’ legitimate expectations regarding their rights under the Supplemental Indenture. Furthermore, Chesapeake was similarly on notice at all relevant times that the district court could require it to pay the Make‐Whole Price for its May 13, 2013 redemption. Finally, the court rejected Chesapeake’s contention that, even if the district court properly awarded breach‐of‐contract damages, it erred by awarding compensation that allowed the Noteholders to recoup in excess of the value of the Notes before the redemption. Accordingly, the court affirmed the judgment. View "Chesapeake Energy v. Bank of New York Mellon Trust" on Justia Law

The district court found third-party plaintiff Qwest failed to prove its claims for intentional interference with a business relationship, unfair competition, and unjust enrichment against third-party defendant FC. The court agreed with the district court that FC did not act with an improper purpose when it contracted with Sancom, a local exchange carrier (LEC), because FC was simply attempting to take advantage of the uncertain regulatory scheme at the time; FC had a legitimate argument that it could be considered an “end user,” and thus Sancom could bill Qwest under its tariff for calls delivered to FC’s call bridges; and thus the district court did not err in finding for FC on Qwest's claim for intentional interference with a business relationship. The court predicted that the South Dakota Supreme Court would not recognize a tort of unfair competition under these circumstances, and found that the district court properly rejected this new tort. The court concluded, however, that the district court incorrectly found FC’s conduct was “neither illegal nor inequitable” because it was simply taking advantage of a loophole until the loophole closed, and the district court improperly considered Sancom’s settlement payments to Qwest when it found FC was not unjustly enriched. Therefore, the court reversed and remanded for reconsideration of whether FC was unjustly enriched. View "Qwest v. Free Conferencing Corp." on Justia Law

The State and the City of Pass Christian’s entered into a forty-year lease. Under the terms of the lease, the City would use a portion of the Harrison County shoreline as a harbor and pursue related commercial development. Russell RP Services, LLC, filed its complaint against the State and the City on November 21, 2013. Russell RP asserted that it held an undivided one-half interest in a parcel of land lying between U.S. 90 and the Gulf of Mexico shoreline, and that the City and State, by executing the aforementioned lease, had effectuated a taking upon its property which required just due compensation. On August 18, 2015, the Harrison County Circuit Court granted the State and City's motions for summary judgment. Concluding that Russell Real Property lacked standing to pursue its claim of inverse condemnation, the circuit court dismissed without prejudice its claim of inverse condemnation. Russell RP appealed, but finding no reversible error, the Supreme Court affirmed. View "Russell Real Property Services, LLC v. Mississippi" on Justia Law

Jason Thornock requested that PacifiCorp provide electric service to an irrigation pivot on his property using a particular easement. PacifiCorp did not utilize the easement that Thornock suggested but did provide electric service to the pivot using a different route under the terms of a second contract the parties entered into after the original contract. When PacifiCorp did not provide power under the easement provided for in the first contract, Thornock filed a complaint against PacifiCorp based on the alleged breach of the first contract. The district court granted summary judgment in favor of PacifiCorp. The Supreme Court affirmed, holding that the first contract between the parties had been superseded and that PacifiCorp was not required to perform under the provisions of that agreement. View "Thornock v. PacifiCorp" on Justia Law

Eaton manufactures truck transmissions for sale to Original Equipment Manufacturers (OEMs), which offer “data books,” listing the options for truck parts. Customer choose among the options; the OEM sources the parts from the manufacturers and uses them to build custom trucks then sold to that customer. Eaton was a near-monopolist in supplying Class 8 truck transmissions. In 1989, ZF emerged as a competitor. Eaton allegedly sought to retain its market share by entering agreements with the OEMs, with increasingly large rebates on Eaton transmissions based on the percentage of transmissions a given OEM purchased from Eaton as opposed to ZF. ZF closed in 2003. In 2006, ZF successfully sued Eaton for antitrust violations. Separately, indirect purchasers who bought trucks from OEMs’ immediate customers brought a class action; that case was dismissed. In this case, Tauro attempt to represent direct purchasers in an antitrust suit was rejected because Tauro never directly purchased a Class 8 truck from the OEMs, but rather purchased trucks from R&R, a direct customer that expressly assigned Tauro its direct purchaser antitrust claims. The Third Circuit reversed. An antitrust claim assignment need not be supported by bargained-for consideration in order to confer direct purchaser standing on an indirect purchaser; it need only be express. That requirement was met. The presumption that a motion to intervene by a proposed class representative is timely if filed before the class opt-out date applies in this pre-certification context. View "Wallach v. Eaton Corp" on Justia Law

Plaintiffs are trust funds and employee benefit plans for construction industry employees. MRS constructs commercial buildings. In 1997, MRS signed “me-too agreements” binding it to collective bargaining agreements (CBAs) bestowing rights on Plaintiffs. Under the agreement, MRS agreed to be bound by the 1997-2001 CBA in force between a multiemployer association and the union. According to Plaintiffs, MRS also agreed to be bound by later CBAs because the 1997 agreement contains an “evergreen clause” and MRS never gave the notice required to terminate the clause. MRS conceded that it never gave notice, but denied that the letter continuously granted bargaining rights. Under each CBA, employers had to make specified contributions to various Plaintiff funds and permit audits of records relevant to those obligations. Plaintiffs sent MRS requests for audits, believing that MRS had failed to make contributions required by the 2012-2015 CBA. When MRS did not comply, Plaintiffs sought post-audit relief under 29 U.S.C. 1145 for unpaid ERISA contributions and injunctive relief compelling MRS to comply with the 2012-2015 and subsequent CBAs. The Third Circuit reversed dismissal, rejecting an argument that all me-too agreements must satisfy two criteria in order to bind non-signatories to future CBAs. Absent that requirement, the plausibility of the complaint should be assessed under contract law principles and states a plausible claim for relief. View "Carpenters Health & Welfare Fund v. Mgmt. Res. Sys., Inc." on Justia Law

Kenneth and Sally Eyer and Idaho Forest Group, LLC (IFG) entered into a Log Purchase Agreement in which IFG agreed to purchase timber harvested from the Eyers’ land. Before logging, IFG sent an agent to the Eyers’ property to assist them in locating property lines. When the logging occurred, the loggers mistakenly cut timber located on neighboring land. The neighbors sued the Eyers for timber trespass and the Eyers brought a third-party action against IFG for breach of an assumed duty to properly mark the property lines. A jury found in favor of IFG, finding that IFG had not assumed a duty to the Eyers. The district court then awarded IFG $95,608 in attorney fees. On appeal, the Eyers argued the district court erred in awarding fees under Idaho Code section 12-120(3), contending: (1) the gravamen of the Eyers’ complaint was not a commercial transaction; and (2) the Eyers did not sell timber for a “commercial purpose” since they used the proceeds of the sale to pay medical bills. Finding no reversible error, the Supreme Court affirmed. View "Eyer v. Idaho Forest Group" on Justia Law

Viking Pump, Inc. and Warren Pumps, LLC sought to recover under insurance policies issued to a third company, Houdaille Industries, Inc. In the 1980's, Viking and Warren acquired pump manufacturing businesses from Houdaille. As a result, Viking and Warren were confronted with potential liability flowing from personal injury claims made by plaintiffs alleging damages in connection with asbestos exposure claims dating back to when the pump manufacturing businesses were owned by Houdaille. Houdaille had purchased occurrence-based primary and umbrella insurance from Liberty Mutual Insurance Company. Above the Liberty umbrella layer, Houdaille purchased layers of excess insurance. In total, Houdaille purchased 35 excess policies through 20 different carriers (the "Excess Policies"). Viking and Warren sought to fund the liabilities arising from the Houdaille-Era Claims using the comprehensive insurance program originally purchased by Houdaille. The insurance companies that issued the Excess Policies (the "Excess Insurers") contended that Viking and Warren were not entitled to use the Excess Policies to respond to the claims. The Excess Insurers also disputed the extent of any coverage available, particularly with respect to defense costs. The Supreme Court held, after careful consideration of the policies at issue: (1) the Superior Court correctly held that the 1980-1985 Liberty Primary Policies were exhausted; (2) the Superior Court held that 33 of the Excess Policies at issue in this appeal provided coverage to Viking and Warren for their defense costs, with many payments contingent on insurer consent; (3) the Court of Chancery correctly held that there were valid assignments of insurance rights to Warren and Viking under the Excess Policies; (4) the Superior Court was affirmed in part and reversed in part with respect to its determination of the Excess Policies' coverage for defense costs; and (5) the Superior Court erred with respect to the trigger of coverage under the Excess Policies. View "In Re Viking Pump, Inc. and Warren Pumps, LLC Insurance Appeals" on Justia Law

Nutt was hit and killed by a U.S. Army soldier driving an Army truck in 1983. His family filed a claim under 28 U.S.C. 2674, the Federal Tort Claims Act. A 1985 Agreement provided that the government “agrees to purchase annuities which will pay:” $60,000 per year to Cynthia; lump-sum payments on specified anniversaries to Cynthia; lump-sum payments on specified anniversaries to James; plus $240,000 to Cynthia and a payment to the Nutts’ attorneys. The Agreement provided that “[t]he payments by the United States set forth above shall operate as full and complete discharge of all payments to be made to and of all claims which might be asserted.” The government purchased a structured annuity ELNY. ELNY went into receivership in 1991. In 2011, the New York State Liquidation Bureau informed the Nutts that their benefit payments would be reduced. In 2013, they began receiving payments reduced to approximately 45% of their expected benefits. They were informed that, as of 2015, they would not be receiving the anniversary payments. The Nutts alleged breach of the agreement. The Federal Circuit affirmed dismissal, finding that the government “was not obligated to guarantee or insure that annuity; its obligation ended at the initial purchase of the ELNY annuity.” View "Nutt v. United States" on Justia Law