Justia Contracts Opinion Summaries

Jarboe was hired by DKD. Shortly after he began working, Jarboe was transferred to Leehan. Following his termination at Leehan, Jarboe brought this wage and hour action individually and on behalf of a putative class against the Hanlees Auto Group, its 12 affiliated dealerships (each us a separate corporate entity), including DKD and Leehan, and three individuals. The defendants moved to compel arbitration based on an employment agreement between Jarboe and DKD. The trial court granted the motion as to 11 of the 12 causes of action against DKD but denied the motion as to the other defendants. The trial court allowed Jarboe’s claim under the Private Attorneys General Act of 2004 (PAGA), Labor Code section 2698, to proceed in court against all defendants. The trial court refused to stay the litigation pending arbitration of Jarboe’s claims against DKD. The court of appeal affirmed, rejecting an argument that the other defendants are entitled to enforce the arbitration agreement between Jarboe and DKD as third party beneficiaries of Jarboe’s employment agreement or under the doctrine of equitable estoppel. View "Jarboe v. Hanlees Auto Group" on Justia Law

Travelex filed suit against defendant to enforce an alleged agreement restricting her ability to compete with Travelex by soliciting business from certain customers. The district court granted partial summary judgment in favor of defendant, determining that the purported agreement was unenforceable.The Eighth Circuit reversed and remanded, holding that summary judgment was not warranted. In this case, the district court concluded that the agreement was unenforceable because the 2008 agreement became a nullity when Travelex was acquired by Cover-More and defendant refused to sign a new agreement as a condition of continued employment and was terminated. The court held that defendant's refusal to sign the new agreement nullified the prior agreement. The court also held that defendant's alternative argument, that under New York law restrictive covenants may not be enforced when an employee is dismissed without cause, does not apply because the non-solicitation agreement is not unreasonable as a matter of law. View "Travelex Insurance Services, Inc. v. Barty" on Justia Law

FEI, Crop Venture's successor-in-interest, filed suit alleging that the individual defendants took proprietary information they developed at Crop Ventures after they left the company and co-founded Farmobile (the corporate defendant). Specifically, FEI alleges that the individual defendants' behavior constituted a breach of explicit or implicit contracts with the company; defendants were obligated to assign to their employer the ownership rights of products they worked to develop; the individual defendants breached their duty of loyalty to their employer; and the individual defendants misappropriated trade secrets. The district court denied in full FEI's motion, and granted in part and denied in part Farmobile's motion.The Eighth Circuit affirmed and held that because no contract bound the parties during Defendant Nuss' term of employment, Nuss was not in breach of an explicit contract; FEI has not shown that any of the individual defendants was similarly "specifically directed" during their product-development process, so no implied contracts were created under the hired-to-invent doctrine; FEI failed to show the individual defendants breached their duty of loyalty to their employer; FEI cannot maintain a trade secret claim under the Nebraska Trade Secrets Act (NTSA) or the federal Defend Trade Secrets Act (DTSA); and the remaining claims are unpersuasive. View "Farmers Edge Inc. v. Farmobile, LLC" on Justia Law

JDC sought a preliminary injunction against its former employee for breach of a non-compete agreement. The district court denied the motion for a preliminary injunction in all its parts and with no concessions.The Fifth Circuit held that the district court, after acknowledging the agreement to be overbroad, erred in declining to adjudicate reformation of the agreement. In this case, the district court should have considered reformation of the agreement in the process of deciding the preliminary injunction motion. Accordingly, the court vacated and remanded to the district court to allow relevant evidence and argument from the parties concerning reformation. Furthermore, the court noted that the district court should then decide what reformation, if any, would be reasonable under Texas law, and proceed to adjudicate the preliminary injunction motion in the light of its findings on reformation. View "Calhoun v. Jack Doheny Companies, Inc." on Justia Law

Six Dimensions filed suit against a former employee and a competitor, Perficient, alleging claims for breach of contracts, unfair competition, and misappropriation of trade secrets.The Fifth Circuit reversed the part of the judgment holding that the employee breached an employment contract and owed damages to Six Dimensions. The court held that the district court abused its discretion in denying the employee an opportunity to extend the arguments she had already made about the 2014 Agreement and have them apply to the 2015 Agreement. However, the court held that the district court did not reversibly err in interpreting California law and concluding that California's strict antipathy towards restraint of trade of any kind in California Business and Professions Code section 16600 voids the nonsolicitation provision here. The court also found no error in the district court's refusal to apply California's Unfair Competition Law, and held that the district court did not abuse its discretion in refusing to find the jury's verdict contrary to the weight of the great evidence as to the misappropriation claim. Therefore, the court otherwise affirmed the district court's judgment. View "Six Dimensions, Inc. v. Perficient, Inc." on Justia Law

Grubhub, an online and mobile food-ordering and delivery marketplace, considers its delivery drivers to be independent contractors rather than employees. The plaintiffs alleged, in separate suits, that Grubhub violated the Fair Labor Standards Act by failing to pay them overtime but each plaintiff had signed a “Delivery Service Provider Agreement” that required them to submit to arbitration for “any and all claims” arising out of their relationship with Grubhub. Grubhub moved to compel arbitration. The plaintiffs responded that their Grubhub contracts were exempt from the Federal Arbitration Act (FAA). Section 1 of the FAA provides that “nothing herein contained shall apply to contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce,” 9 U.S.C. 1. Both district courts compelled arbitration.The Seventh Circuit affirmed. The FAA carves out a narrow exception to the obligation of federal courts to enforce arbitration agreements. To show that they fall within this exception, the plaintiffs had to demonstrate that the interstate movement of goods was a central part of the job description of the class of workers to which they belong. They did not even try to do that. View "Wallace v. Grubhub Holdings, Inc." on Justia Law

Plaintiff-appellant Aaron Jensen sued defendant-appellees West Jordan City and Robert Shober for Title VII retaliation, First Amendment retaliation, malicious prosecution, and breach of contract. At trial, the jury returned a verdict in favor of Jensen on all his claims and awarded $2.77 million in damages. The trial court discovered the jury did not properly fill out the verdict form, so the court instructed the jury to correct its error. When the jury returned the corrected verdict, it had apportioned most of the damages to Jensen’s Title VII claim. Because the district court concluded that Title VII’s statutory damages cap applied, the court reduced the total amount of the award to $344,000. Both parties appealed. They raised nine issues on appeal, but the Tenth Circuit concluded none of them warranted reversal and affirmed. View "Jensen v. West Jordan City" on Justia Law

The Supreme Court held that the California Public Employees' Pension Reform Act's (PEPRA), Stats. 2012, ch. 296, 1, amendment of the County Employees Retirement Law (CERL), Cal. Gov. Code 31450 et seq., did not violate the contract clause under a proper application of the California Rule and declined to reexamine and revise the California Rule.At issue was whether a provision of PEPRA amending CERL's definition of "compensation earnable," which affected the pensions of persons who were first employed by a county prior to the effective date of PEPRA, violated the contract clause. The Supreme Court held (1) county employees have no express contractual right to the calculation of their pension benefits in a manner inconsistent with the terms of the PEPRA amendment; (2) the challenged provisions added by PEPRA met contract clause requirements; and (3) the test announced in Allen v. City of Long Beach, 45 Cal.2d 128 (1955), as explained and applied in this case, remains the law of California. View "Alameda County Deputy Sheriff's Ass'n v. Alameda County Employees' Retirement Ass'n" on Justia Law

The First Circuit affirmed the district court's denial of Appellants' motion to compel arbitration in this putative class action, holding that the Federal Arbitration Act's (FAA) exemption for "contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce" encompasses the contracts of transportation workers who transport goods or people within the flow of interstate commerce.Plaintiff was a delivery driver for Amazon.com, Inc. and its subsidiary, Amazon Logistics, Inc. (collectively, Amazon) who collected packages for delivery in Massachusetts and did not cross state lines during the course of his deliveries. Plaintiff filed this putative class action asserting misclassification of Amazon's drivers contracted with through its smartphone application as independent contractors and violations of Massachusetts labor laws. Amazon moved to compel arbitration pursuant to the mandatory arbitration provision of Plaintiff's employment agreement with Amazon. The district court denied the motion in part, concluding that Plaintiff's agreement was exempt from the FAA and that the provision was unenforceable based on Massachusetts public policy. The First Circuit affirmed, holding (1) the FAA does not govern the enforceability of the dispute resolution section of the agreement; and (2) the district court rightly refused to compel arbitration pursuant to state law. View "Waithaka v. Amazon.com, Inc." on Justia Law

The Supreme Court affirmed in part and reversed in part the judgment of the district court awarding $2,353,463 in damages to Junkermier, Clark, Campanella, Stevens, P.C. (JCCS), a Montana accounting firm, after a bench trial on remand, holding that the district court did not err by awarding prejudgment interest but erred with regards to the date interest began accruing.Appellants, five of six shareholders in JCCS' Bozeman office, were employed under the terms of an Employment Agreement that contained a covenant restricting competition (Covenant). Appellants later began working at a newly formed accounting firm and solicited clients from JCCS' Bozeman client list. JCCS filed a complaint against Appellants to declare the Covenant enforceable and to recover damages. On remand, the district court determined that the Covenant was reasonable, Appellants were jointly and severally liable for damages arising out of the Covenant's breach, and JCCS was entitled to prejudgment interest. The Supreme Court largely affirmed, holding that the district court did not err by (1) concluding that Appellants were jointly and severally liable for JCCS' damages; (2) concluding that the Covenant was reasonable; (3) awarding prejudgment interest but erred with regards to the date interest began accruing; and (4) by denying Appellants' motion for discovery sanctions. View "Junkermier, Clark, Campanella, Stevens, P.C. v. Alborn" on Justia Law