Justia Contracts Opinion Summaries

Sweeney owned a transmission shop and referred customers to Tradewell, who owned a nearby car rental business. Sweeney would sometimes simply refer customers to Tradewell or drive them to Tradewell’s business. If employees were available, Tradewell would have them take a car to Sweeney’s shop. Sweeney would sometimes pick up a car from Tradewell and deliver it to the customer and would occasionally use the car for personal errands. This was encouraged by Tradewell, who asked Sweeney to make sure the cars were running properly. In 2004 Sweeney, returning from a personal errand, was injured in an accident while driving a car owned by Tradewell that was intended for delivery to a customer the following morning. Sweeney sought underinsured motorist benefits pursuant to his policy with Liberty. Liberty sought a declaration that Sweeney was not entitled to coverage. On remand, the district court granted Liberty summary judgment, finding that “intended use” and “regular use” provisions did not bar coverage, but Liberty could deny coverage based on the “auto business” provision. The Third Circuit reversed, in favor of Sweeney, noting that Sweeney was on a personal errand, not engaged in “auto business” and did not have unfettered use of the cars. View "Liberty Mut. Ins. Co. v. Sweeney" on Justia Law

The Supreme Court granted leave in two cases to address the question whether a person injured while driving a motor vehicle that the person had taken contrary to the express prohibition of the owner may avail himself or herself of personal protection insurance benefits (PIP benefits) under the no-fault act, notwithstanding the fact that MCL 500.3113(a) bars a person from receiving PIP benefits for injuries suffered while using a vehicle that he or she "had taken unlawfully, unless the person reasonably believed that he or she was entitled to take and use the vehicle." Upon review, the Supreme Court held that any person who takes a vehicle contrary to a provision of the Michigan Penal Code (including MCL 750.413 and MCL 750.414, the "joyriding" statutes) has taken the vehicle unlawfully for purposes of MCL 500.3113(a). Furthermore, the Court held that the use of the phrase "a person" in MCL 500.3113(a) "clearly and plainly" includes a family member who has taken a vehicle unlawfully, thereby precludes that person from receiving PIP benefits. View "Spectrum Health Hospitals v. Farm Bureau Mutual Ins. Co. of Michigan" on Justia Law

Milliken & Company sued Brian Morin after he resigned from the company and started a new venture using Milliken's proprietary information. The primary basis of the suit was that Morin breached the confidentiality and invention assignment agreements he signed when he started working for Milliken. A jury found for Milliken, and the court of appeals affirmed. The Supreme Court granted certiorari to review the narrow issue of whether these agreements are overbroad as a matter of law. Upon review, the Court held that they were not and affirmed as modified. View "Milliken & Company v. Morin" on Justia Law

This insurance coverage dispute arose from a policy designed to protect financial institutions from losses caused by dishonest employees. Trying to recover nearly one million dollars stolen by an employee from client brokerage accounts, three financial institutions sued the insurance company that issued the policy. The district court held that the policy covered the losses and granted summary judgment to the financial institutions. The Sixth Circuit Court of Appeals affirmed the court's liability judgment and all but one of its damages calculations, holding (1) the stolen money was covered property; (2) the employee's theft caused a direct loss to the bank; (3) the employee committed his dishonest acts with the manifest intent to cause the loss; and (4) the district court's decision to subtract another insurance company's $50,000 pay-out to the banks based on another employee-dishonesty policy from the damages award was error. Remanded. View "First Defiance Fin. Corp. v. Progressive Cas. Ins." on Justia Law

The City of New Orleans filed suit against BellSouth Telecommunications, LLC, claiming that the company owed it additional compensation for the use of its public rights-of-way. The district court rejected the City's claims for additional compensation pursuant to the various contracts between the parties. The court, however, awarded the City $1.5 million in unjust enrichment damages to compensate the City for benefits the company had received from its use of the City's rights-of-way. Both parties appealed. The City then enacted an ordinance to force BellSouth to continue compensating the City in future years for the unjust enrichment identified by the district court. BellSouth moved for a preliminary injunction to enjoin the City from enforcing the ordinance, which the district court denied. The Fifth Circuit Court of Appeals (1) affirmed the district court's findings of fact and conclusions of law, in part, to the extent the court rejected the City's claims for damages; and (2) reversed and vacated the district court's judgment awarding unjust enrichment damages to the City, holding that BellSouth had justification in contract for any enrichment it was enjoying from its use of the City's rights-of-way. Remanded with instructions to permanently enjoin enforcement of the City's ordinance. View "City of New Orleans v. BellSouth Telecomm., Inc." on Justia Law

Following a jury trial, Chevron USA, Inc. was awarded damages from Aker Maritime, Inc. and its subsidiaries, and from Oceaneering International, Inc. for the failure of small and inexpensive bolts used on an oil production and drilling facility. A bench trial was held on remand to consider remaining contractual claims. The district court ordered Oceaneering to pay indemnity and attorneys' fees to Aker. On appeal, Oceaneering sought to reverse those awards. The Fifth Circuit Court of Appeals affirmed, holding (1) Aker was an agent of Chevron under the parties' contract, and therefore, pursuant to the contract, Aker was entitled to indemnity; and (2) the district court did not abuse its discretion in awarding attorneys' fees to Aker. View "Chevron USA, Inc. v. Aker Maritime, Inc." on Justia Law

The City of New Orleans filed suit against BellSouth Telecommunications, LLC, claiming that the company owed it additional compensation for the use of its public rights-of-way. The district court rejected the City's claims for additional compensation pursuant to the various contracts between the parties. The court, however, awarded the City $1.5 million in unjust enrichment damages to compensate the City for benefits the company had received from its use of the City's rights-of-way. Both parties appealed. The City then enacted an ordinance to force BellSouth to continue compensating the City in future years for the unjust enrichment identified by the district court. BellSouth moved for a preliminary injunction to enjoin the City from enforcing the ordinance, which the district court denied. The Fifth Circuit Court of Appeals (1) affirmed the district court's findings of fact and conclusions of law, in part, to the extent the court rejected the City's claims for damages; and (2) reversed and vacated the district court's judgment awarding unjust enrichment damages to the City, holding that BellSouth had justification in contract for any enrichment it was enjoying from its use of the City's rights-of-way. Remanded with instructions to permanently enjoin enforcement of the City's ordinance. View "BellSouth Telecomm., LLC v. City of New Orleans" on Justia Law

This insurance coverage dispute arose from a policy designed to protect financial institutions from losses caused by dishonest employees. Trying to recover nearly one million dollars stolen by an employee from client brokerage accounts, three financial institutions sued the insurance company that issued the policy. The district court held that the policy covered the losses and granted summary judgment to the financial institutions. The Sixth Circuit Court of Appeals affirmed the court's liability judgment and all but one of its damages calculations, holding (1) the stolen money was covered property; (2) the employee's theft caused a direct loss to the bank; (3) the employee committed his dishonest acts with the manifest intent to cause the loss; and (4) the district court's decision to subtract another insurance company's $50,000 pay-out to the banks based on another employee-dishonesty policy from the damages award was error. Remanded. View "First Defiance Fin. Corp. v. Progressive Cas. Ins." on Justia Law

In 2004-2005, Costa & Son Construction performed site work for the general contractor (Braitt) on such a project in Bridgewater. After Braitt terminated the relationship Costa sued, alleging breach of contract and violations of G.L. c. 93A. Costa sought to recover damages under a payment bond obtained by Brait from Arch Insurance, G.L. c. 149, 29. Brait asserted similar counterclaims against Costa. Arch argued that Costa had relinquished any right to claim against the bond pursuant to a provision of his subcontract with Brait. The trial court granted Brait and Arch directed verdict with respect to claims under the bond. A jury returned a verdict for Costa, against Brait. The Massachusetts Supreme Court vacated the directed verdict. A subcontractor on a public construction project for which a payment bond has been obtained by the general contractor pursuant to G.L. c. 149, 29, may not by private agreement forgo its right to pursue payment under the bond. The court also vacated the portion of the amended judgment granting consequential damages to Costa; consequential damages were precluded by the contract. View "Costa v. Brait Builders Corp." on Justia Law

Defense contractor Raytheon, specializes in infrared imaging. Indigo, also specializing in infrared imaging, was founded by former Raytheon employees including Woolaway, who promised not to recruit Raytheon employees. Indigo began consulting for Raytheon, governed by Confidential Disclosure Agreements. In 1997, Raytheon became concerned that Indigo was recruiting Raytheon personnel to gain access to trade secrets. The companies settled the matter by agreement. The relationship between Raytheon and Indigo terminated in 2000. In 2000, Indigo won a military contract; in 2003, Indigo was selected over competitors, including Raytheon, to receive another subcontract. In 2004, Raytheon acquired and disassembled an Indigo infrared camera and found what it believed was evidence of patent infringement and trade secret misappropriation. In 2007, Raytheon found a correlation with the expertise of former employees who had departed for Indigo. The district court dismissed claims of trade secret misappropriation as time barred. The Federal Circuit reversed. The district court erred by resolving genuine factual disputes in favor of Indigo, the moving party, and concluding that Raytheon should have discovered its claims before March 2, 2004. View "Raytheon Co. v. Indigo Sys. Inc." on Justia Law