Justia Contracts Opinion Summaries

Muse, Nelson, and Weiss, and two others formed DGP. The five individuals were DGP’s limited partners; its general partner was MNW LLC, consisting of Muse, Nelson, and Weiss. DGP contracted to buy Gas Solutions and Prospect agreed to lend DGP 95% of the purchase price, subject to due diligence. The agreement prevented DGP from negotiating with other lenders. Prospect’s investigation raised concerns and it informed DGP that it would not make the loan. After DGP threatened to sue, Prospect agreed to pay DGP $3.295 million as reimbursement for DGP’s expenses and DGP agreed to assign Prospect its right to buy Gas Solutions. DGP assigned the purchase contract to DGP’s general partner, MNW, owned by Muse, Nelson and Weiss, who then sold Prospect their individual membership interests, transferring the contract to Prospect. Despite a mutual release, DGP sued Prospect alleging fraud, breach of fiduciary duty, and tortious interference with contract. Prospect counterclaimed alleging breach of the covenant not to sue. The district court granted summary judgment in favor of Prospect and awarded attorneys’ fees in its award. The Fifth Circuit affirmed, rejecting an argument that the covenants did not bind the individuals. Under an interpretation of the agreement giving effect to all its terms, Nelson and Muse breached the agreement by funding DGP’s lawsuits and violated the release and covenant not to sue.View "Dallas Gas Partners, L.P. v. Prospect Energy Corp" on Justia Law

Petitioners, who had a liability policy with State Farm, were involved in a motor vehicle accident. Petitioners filed an underinsured motorist claim with State Farm. Based on the absence of underinsurance coverage in Petitioners' policy, State Farm denied coverage. Petitioners filed a complaint against State Farm, asserting that a "knowing and intelligent" waiver of underinsurance coverage had not occurred. The circuit court granted Petitioners' motion for partial summary judgment, concluding (1) State Farm's underinsured motorist selection/rejection form did not precisely comply with the state Insurance Commissioner's prescribed form; and (2) State Farm's failure to use the Commissioner's prescribed forms resulted in underinsured motorists coverage being added to the policy as a matter of law. The Supreme Court answered the circuit court's certified question by holding that an insurance company's failure to use the Commissioner's prescribed forms pursuant to W. Va. Code 33-6-31(d) results in the loss of the statutory presumption that the insured provided a reasonable offer which was knowingly rejected and a reversion to the lower standards set forth in Bias v. Nationwide Mutual Insurance Co. View "Thomas v. McDermitt" on Justia Law

Spectera is a vision care insurer that provides eye care benefits coverage to Georgia residents. Appellee Steven M. Wilson is a licensed optometrist who provides eye care services in Lowndes County as Wilson Eye Center ("WEC"). Appellees Cynthia McMurray, Jodie E. Summers, and David Price are also licensed optometrists that work for WEC. Prior to 2010, Spectera had entered provider contracts ("Patriot contracts") with Wilson and McMurray and they became members of Spectera's panel of eye care providers. In 2010, Spectera decided to terminate its Patriot contracts and replace them with independent participating provider (IPP) agreements. Under the new agreement "[appellees] would no longer receive the reimbursement for materials from Spectera and would no longer be entitled to retain the materials co[-]pays from Spectera insureds." Appellees sued Spectera contending that Spectera's proposed IPP agreement violated various subsections of Georgia's Patient Access to Eye Care Act. While the case was pending, the trial court issued a temporary injunction prohibiting Spectera from forcing its panel of independent participating providers in Georgia to abide by the IPP agreement. After the trial court temporarily enjoined Spectera from enforcing its IPP agreement, Spectera sought to remove appellees Wilson, Summers, and McMurray from its approved panel of providers altogether; but the trial court enjoined Spectera from taking such action. Although appellee Price was not on Spectera's provider panel, he alleged Spectera violated the Act by denying him membership on its panel because of his refusal to sign the IPP agreement. The trial court granted the appellees' motions for summary judgment, denied Spectera's motion for summary judgment and issued a permanent injunction precluding Spectera from enforcing the restrictions contained in the IPP agreement as to "any other licensed eye care provider on [Spectera's] provider panel" or those who had applied to be on the panel. Spectera appealed the trial court's decision to the Court of Appeals which affirmed in part and reversed in part. The Court of Appeals found that the covered materials requirement in the IPP agreement violated subsections (c)(2) and (c)(5) of the Act in regard to independent optometrists. The issue before the Supreme Court was whether the Court of Appeals correctly construed OCGA 33-24-59.12 (c) of the Act. Because the IPP agreement did not create the type of impermissible discrimination between classes of licensed eye care providers contemplated by subsection (c)(5), the Court of Appeals was incorrect in its conclusion that the IPP agreement violated that subsection of the Act. Accordingly, the Court reversed that portion of the Court of Appeals' decision. The Act does not preclude insurers from terminating contracts with its existing eye care providers. "While Spectera's terminating its contracts with appellees Wilson, McMurray, and Summers may be an unpopular or ill-advised course of action, it cannot be said such action violates the Act." Therefore, that portion of the permanent injunction against Spectera was vacated. View "Spectera, Inc. v. Wilson" on Justia Law

After Petitioners and Respondent, Town of Clay, entered into a construction contract, Petitioners filed a complaint for preliminary injunctive relief based on a dispute over the contract. Petitioners paid a $25,000 injunction bond to the circuit court. Later, the court dismissed Petitioners' complaint and ordered that Petitioners' bond be forfeited and paid over to the Town to compensate it for its attorney fees and costs. The Supreme Court affirmed in part and reversed in part, holding (1) the bond was subject to forfeiture in the absence of a finding that the underlying suit was filed in bad faith; (2) Petitioners were not given a fair opportunity to contest whether the attorney fees and costs were incurred by Respondent in attempting to secure a dissolution of the bond; and (3) the circuit court erred in not holding a hearing under the standards set forth in Aetna Casualty & Surety Co. v. Petrolo to determine whether the fees and costs were reasonable. Remanded. View "Multiplex Inc. v. Town of Clay" on Justia Law

The party to an exclusive marketing, license, and distribution agreement (licensee) brought contract and tort claims in California against the other parties to that agreement and their affiliated companies (licensors). The defendants in that action, including the licensors, were the plaintiffs in this action. Plaintiff sought a declaratory judgment that the agreement was properly terminated and injunctive relief relating to the agreement's confidentiality and termination provisions. Defendant asserted counterclaims for breach of contract, among other claims. The Court of Chancery awarded the licensee damages against the licensors, their parent, and a sister company, holding (1) those plaintiffs who were parties to the agreement breached the non-compete provision of that agreement or the implied covenant of good faith and fair dealing, and those plaintiffs and a sister company were liable in tort for tortious interference with contract; (2) the additional named plaintiffs were not liable in contract or tort; (3) the agreement was properly terminated, and Defendant was required to comply with the agreement's termination and confidentiality provisions; and (4) both parties' requests for attorneys' fees were denied. View "eCommerce Indus., Inc. v. MWA Intelligence, Inc." on Justia Law

Plaintiffs Kylie and Michael D. Shuba appealed the Superior Court's denial of their cross-motion for summary judgment and its grant of summary judgment in favor of Defendant United Services Automobile Association's ("USAA") motion for summary judgment. The Shuba's sought to be covered persons for the wrongful death of their mother under an insurance policy issued by USAA and held by the Shubas' step-mother. It was undisputed that their mother was not a named insured under the policy or a resident of the stepmother's household as the Shubas were. The Shubas claimed the trial court erred in finding the Shubas could not recover uninsured motorist benefits under the USAA policy. In making their claim, the Shubas asked the Supreme Court to overrule two Superior Court cases, "Temple v. Travelers Indemnity Co" and "Adams-Baez v. General Accident Co.," the latter of which the Supreme Court affirmed based on the trial court opinion. The Supreme Court declined to overrule those cases as precedent, and affirmed the Superior Court's judgment. View "Shuba v. United Services Automobile Association" on Justia Law

George Patrick Stacey and Innovative Treasury Systems, Inc. ("I.T.S."), sued Anthony Lee Peed for breach of contract, account stated, and money lent. Peed denied he was indebted to Stacey and I.T.S., moved for dismissal and asserted various affirmative defenses. The trial court granted Peed's motion. Stacey and I.T.S. moved to alter, amend, or vacate that judgment, which was ultimately denied by operation of law. Stacey and I.T.S. then appealed the circuit court's judgment, arguing the circuit court received substantial evidence of the formation of a contract and of "open account [stated]" and because Peed had failed to present a counterargument regarding their claim for money lent. After careful review of the circuit court record, the Supreme Court affirmed in part, reversed in part, and remanded for further proceedings. The Court affirmed summary judgment with respect to Stacey and I.T.S.'s claim for open account stated and reversed as to Stacey and I.T.S.'s claims of breach of contract and money due on an open account and as to the determination that the money was a gift. View "Stacey v. Peed " on Justia Law

The Probate Court appointed Theodore Ballard's niece, Leala Bell, as Ballard's guardian. Bell signed a promissory note to a mortgage as a "borrower"; she did not expressly indicate that she was signing as Ballard's guardian or that her signature indicated only her "approval" of Ballard's action. The loan was secured by a mortgage on Ballard's real property. The mortgage deed granted and conveyed Ballard's property to CitiFinancial, including the power to sell the property. Ballard signed the mortgage deed but Bell did not. There was no showing that the probate court licensed the mortgage. CitiFinancial alleged that Ballard had failed to make the payments called for under the note and mortgage, and therefore breached these agreements. Ballard moved for summary judgment, arguing in relevant part that he lacked the legal capacity to execute a mortgage deed and promissory note while he was under guardianship. Upon review, the Supreme Court found that Ballard's argument relied on the notion that Bell participated in the transaction with CitiFinancial, subjected herself to personal liability as a cosigner of the note, signed the settlement statement as well as the promissory note, but did not actually approve Ballard's signing of the note. Although the mortgage deed purportedly executed by Ballard and the promissory note secured by that deed were executed as part of the same overall transaction, the two documents created distinct legal obligations. The Supreme Court concluded that the trial court erred in analyzing the note and mortgage as if they were one and the same, both subject to the requirement of probate court approval. Therefore the Court reversed the award of summary judgment to Ballard on CitiFinancial's claim on the promissory note and remanded the case back to the trial court for further proceedings on that claim. View "CitiFinancial, Inc. v. Balch" on Justia Law

Defendant sold home theater systems manufactured by Plaintiff, Bose Corporation, for use in the U.S. to customers abroad. Defendant, who was not an authorized reseller or distributor of Bose products, sold the systems across international markets to take advantage of high retail prices in other countries. Plaintiff filed this action against Defendant for breach of contract and trademark infringement, asserting that Defendant sold its American products in Australia without Plaintiff's consent even though he had signed a settlement agreement promising not to make such sales after he had made similar sales in Europe. The First Circuit Court of Appeals affirmed, holding (1) the settlement agreement was a valid contract; and (2) summary judgment on the trademark infringement claim was appropriate. View "Bose Corp. v. Ejaz" on Justia Law

Plaintiff, the owner of a home warranty plan from First American, filed a class action complaint alleging that First American refused to make timely repairs, used substandard contractors, and wrongfully denied claims. The district court dismissed some of plaintiff's claims under Rule 12(b)(6); First American made an offer of judgment on plaintiff's remaining claims; and, when plaintiff did not accept the offer, the district court dismissed the remaining claims for lack of subject matter jurisdiction. On appeal, plaintiff challenged the district court's dismissal of plaintiff's remaining claims. The court vacated the dismissal of the remaining individual claims, holding that an unaccepted Rule 68 offer that would fully satisfy plaintiff's claim was insufficient to render the claim moot. Therefore, plaintiff's remaining claims were not made moot by her refusal to accept First American's Rule 68 offer, even assuming that the offer would have fully satisfied her claims. View "Diaz v. First American" on Justia Law