Justia Contracts Opinion Summaries

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

Saw worked for Avago’s Malaysian subsidiary and could acquire ordinary shares and stock options of Avago stock under a management shareholders' agreement governed by the laws of Singapore. The agreement allowed Avago to repurchase shares and options at fair market value should an employee be terminated “for any reason whatsoever” within five years from the date of purchase. After Saw’s position was eliminated in 2009, Avago repurchased his equitable interest. Saw sued Avago’s subsidiary for wrongful termination and obtained a favorable judgment in Malaysia. Saw separately sued Avago in San Mateo County, asserting that Avago breached the shareholders' agreement by relying on an unlawful termination to repurchase his shares.The court of appeal affirmed summary judgment in favor of Avago. Saw is not entitled to any relief under Singapore law. The shareholders' agreement's choice of law provision requires the application of the substantive law of Singapore. Whether his termination was lawful or unlawful under Malaysian law has no bearing on Avago’s contractual right to repurchase shares acquired by a former employee. Saw’s breach of contract claim fails as a matter of law under the express terms of the shareholders' agreement. Saw has no viable cause of action under an implied duty of good faith. View "Saw v. Avago Technologies, Ltd." on Justia Law

The lack of initials next to a jury waiver contained in an arbitration agreement, even though the drafter included lines for the initials, is of no legal consequence in this case.After plaintiff filed an employment-related suit against BaronHR, BaronHR moved to compel arbitration. The Court of Appeal held that the trial court erred in denying the motion to compel arbitration because the language of the agreement between the parties establishes their mutual assent to submit employment-related disputes to arbitration and to waive the right to a jury trial. Furthermore, plaintiff does not dispute that he signed the agreement and thus he is deemed to have assented to its terms. The court stated that the fact that plaintiff did not also initial the subject paragraph does not provide a basis for concluding the parties did not mutually assent to the arbitration agreement. View "Martinez v. BaronHR, Inc." on Justia Law

In this action challenging an ordinance passed in 2011 requiring retirees from the City's police and fire departments to enroll in the federal Medicare program upon reaching the age of eligibility instead of continuing to have the City pay for their private health insurance for life the Supreme Court affirmed in part and vacated in part the final judgment of the superior court in favor of the City, holding that the trial judge misconceived the evidence with respect to the health care benefits that Plaintiffs were receiving from the City.Most police or firefighter retirees filed suit challenging the ordinance, and many settled. Some retirees opted out of the settlement and pursued their claims through a bench trial. The trial justice found in favor of the City. The Supreme Court held (1) with respect to Plaintiffs' claims for breach of contract, violation of the Takings Clause, and promissory estoppel, the superior court's judgment was proper; and (2) as to Plaintiffs' Contract Clause claims, the trial justice overlooked or misconceived evidence in several crucial respects. The Court remanded the case with instructions to enter judgment consistent with the provisions pertaining to the Medicare Ordinance as set forth in the final and consent judgment in the lawsuit from which Plaintiffs opted out. View "Andrews v. Lombardi" on Justia Law

The Private Attorney General Act (Labor Code 2698) allows an employee, as a proxy for state enforcement agencies, to sue an employer on behalf of herself and other aggrieved employees for Labor Code violations. When the parties have an arbitration agreement, California law blocks the employer from enforcing that agreement with respect to representative PAGA claims for civil penalties; the agreement may be enforceable with respect to other claims, including claims for victim-specific relief (like unpaid wages). Lime rents electric scooters. Olabi entered into an agreement to locate, recharge, and redeploy Lime's scooters. The agreement required the parties to arbitrate “any and all disputes,” including Olabi’s classification as an independent contractor but contained an exception for PAGA representative actions.Olabi sued, alleging Lime intentionally misclassified him and others as independent contractors, resulting in Labor Code violations; he included claims under the Unfair Competition Law and PAGA. Lime petitioned to compel arbitration, arguing Olabi was required to arbitrate independent contractor classification disputes and that the PAGA exception did not cover the unfair competition claim or the PAGA claim to the extent that Olabi sought victim-specific relief. Olabi voluntarily dismissed his unfair competition claim and disavowed any claim for victim-specific relief. The trial court denied Lime’s petition and granted Olabi leave to amend. The court of appeal affirmed. The language of the arbitration agreement broadly excludes PAGA actions View "Olabi v. Neutron Holdings, Inc." on Justia Law