Justia Contracts Opinion Summaries

Plaintiff entered into a "Stipulation Agreement Regarding Damages," approved by the EEOC, to resolve her Title VII pregnancy discrimination claim against the U.S. Postal Service. She later filed suit in the Court of Federal Claims, alleging breached of that Agreement. The court held that it did not have jurisdiction because the Agreement was a consent decree, not a contract. In the federal system, when the United States is the defendant, whether the issue is enforcement of a court decree by the issuing forum or enforcement of a settlement contract in a separate suit determines which court can hear the case. The Federal Circuit reversed, stating that the "dispute is yet another example of the wastefulness of litigation over where to litigate." Consent decrees and settlement agreements are not necessarily mutually exclusive; a settlement agreement, even one embodied in a decree, is a contract within the meaning of the Tucker Act.

Stephan Odders and Gerald Kerber were former employees of Loparex, a corporation in the release liner industry. Both employees were subject to a one-year noncompetition agreement upon termination of employment. After ceasing employment at Loparex, both employees began employment with MPI Release Technologies, a competitor in the release liner industry. Loparex sued Kerber and Odders (Defendants) in the U.S. district court, seeking injunctive relief under the Illinois Trade Secrets Act and damages resulting from Defendants' breach of the noncompetition agreement. Defendants filed amended answers and counterclaims accusing Loparex of blacklisting in violation of Indiana law. The Supreme Court accepted certification to answer questions of state law and held (1) Wabash Railroad Co. v. Young, which held that Indiana's Blacklisting Statute did not provide a cause of action to individuals who voluntarily leave their employment, is no longer good law and individuals who voluntarily leave employment are not barred from making a claim under the Blacklisting Statute; (2) attorney fees are not an element of compensatory damages under the Blacklisting Statute; and (3) an employer's suit against a former employee to protect trade secrets is not a basis for recovery under the Blacklisting Statute.

The collective bargaining agreement was scheduled to expire. During negotiations, the union disclaimed representation of the company's employees and terminated the collective bargaining process. The company then withdrew from the multiemployer pension plan. The pension fund imposed withdrawal liability and assessed $57,291.50, 29 U.S.C. 1399. The company demanded indemnification from the union pursuant to the collective bargaining agreement, which stated: "The Union shall indemnify the Company for any contingent liability which may be imposed under the Multiemployer Pension Plan Amendments Act of 1980." The district court concluded that an arbitration provision was enforceable. The arbitrator ordered the union to pay. The district court upheld the award. The Sixth Circuit affirmed, rejecting an argument that it would violate public policy for a union to indemnify an employer for any contingent liability to a pension plan established under the Employee Retirement Income Security Act of 1974, 29 U.S.C. 1381-1461.

Richard and Elaine Benson, Bill and Mary Bliven, Don and Annette Feist, Pat Lynch, and Lloyd and Donna Tribitt ("Bensons") appealed the grant of summary judgment that dismissed their claim that SRT Communications, Inc.,was contractually obligated to provide them post-retirement health and medical benefits. The Bensons are four retired employees of the Minot telephone business, their spouses, and Pat Lynch, the widow of a deceased retiree, Thomas Lynch. Richard Benson, Bill Blevin, Don Feist, Lloyd Tribitt, and Thomas Lynch worked for NSP before it sold its telephone business to Minot Telephone in 1991, and they all retired from Minot Telephone between 1991 and 1994, before Souris River purchased Minot Telephone from Rochester. With the exception of Don Feist, the retired employees belonged to Local Union No. 949 of the International Brotherhood of Electrical Workers when the labor union and NSP entered into a collective bargaining agreement in 1991. Feist previously had been a member of the labor union, but did not belong to the union when it entered into the 1991 collective bargaining agreement with NSP. The district court concluded the 1991 collective bargaining agreement expired on December 31, 1993, and although SRT Communications continued to provide post-retirement health benefits to the Bensons for over fourteen years after the expiration of the collective bargaining agreement, it did so as a matter of business discretion and not because of a contractual obligation. The district court dismissed the Bensons' claims against SRT Communications. Upon review, the Supreme Court affirmed the judgment, concluding the Bensons' action was governed by federal law and they failed to raise a disputed issue of material fact.

Dr. Carroll Meador filed a complaint against Mississippi Baptist Health Systems, Inc. (MBHS), Trustmark National Bank (Trustmark), and Doe Defendants 1 through 10, for breach of fiduciary duties, interference with fiduciary duties, interference with contract rights, interference with prospective business advantage, intentional infliction of emotional distress, deceit, fraud, and retaliatory discharge. The complaint stemmed from the doctor's employment with MBHS and a large line of credit he obtained from Trustmark. A dispute between the parties ended with the bank suing the doctor for defaulting on the loan, and the doctor declaring bankruptcy. Several defendants sought to remove the case to the federal district court. The district court granted remand of the case, finding the federal bankruptcy proceedings in the case had been concluded and only state claims remained. Then Defendants Trustmark, MBHS and several codefendants filed a motion for summary judgment and motion to dismiss. The doctor appealed the ultimate outcome of the trial court's decision in favor of Defendants. Upon review, the Supreme Court found that the trial court abused its discretion in refusing to strike portions of the doctor's affidavit, and in denying Trustmark and MBHS' motions for summary judgment. The Court reversed the trial court's decision and remanded the case for further proceedings.

San Juan Coal Company and the International Union of Operating Engineers Local 953 entered into binding arbitration to determine whether union members on a certain schedule were entitled to holdover pay. The arbitrator concluded that the union members were entitled to the extra pay, but on review, the district court overturned the arbitral award. Because the arbitrator’s interpretation was colorable, the Tenth Circuit held that the district court improperly substituted its interpretation of the agreement: "[a]n arbitrator's interpretation of an agreement, even one that is flawed or based on questionable findings of fact, is due the utmost judicial deference. It matters not that a reviewing court might offer a more cogent reading of the agreement; the arbitrator's interpretation must be upheld wholly unless it is without any textual basis."

During the course of his employment as a police officer for the Town of Abingdon, Kevin Christy suffered injuries from an automobile accident. Christy was insured under an automobile liability insurance policy issued by Mercury Casualty Company (Mercury). Christy submitted a claim to Mercury for payment of the portion of his medical expenses not paid by the Town's workers' compensation carrier. Mercury denied the claim, asserting that an exclusion in the policy barred Christy from receiving any payment for medical expenses because a portion of those expenses had been paid by workers' compensation benefits. Christy filed a warrant in debt against Mercury seeking contract damages. The district court entered judgment in favor of Christy. The circuit court reversed, concluding that, based on the unambiguous language of the exclusion, payment of workers' compensation triggered the exclusion and precluded payment by Mercury. The Supreme Court affirmed, holding that the language of the exclusion was clear and that the exclusion permitted Mercury to deny coverage for any expenses that would have been subject to workers' compensation coverage without regard to whether all of those expenses were actually paid by the workers' compensation carrier.

Plaintiff-Counterdefendant-Appellant David Oakes, M.D. was employed as a cardiologist by Defendant-Counterclaimant-Respondent Boise Heart Clinic Physicians, PLLC (BHC) from January 2000 until the end of July 2008, when he left to pursue other employment opportunities. While employed by BHC, Plaintiff had an employment agreement that entitled him to half the adjusted gross charges he generated. Because of his complicated arrangements with other service providers, Plaintiff's final payment was not calculated until after his departure. After his employment ended, Plaintiff corresponded with BHC regarding his final payment. Plaintiff never received payment. Instead, he received a series of letters that detailed the evolving computation of his final payment. BHC's last letter to Plaintiff included a demand for repayment. Plaintiff then sued claiming that BHC still owed him money under the employment agreement. In rendering its verdict, the jury was given a choice between three special verdict forms that corresponded with the three possible verdicts: one finding that neither party is entitled to recover from the other; one that finding that BHC owed money to Plaintiff; and one finding that Plaintiff owed money to BHC. The jury returned with a verdict in favor of Plaintiff, and against BHC, that awarded Plaintiff $2,043.92. Ultimately the district court entered a final judgment that awarded Plaintiff $2,043.92 and declared that neither party was the prevailing party for purposes of costs and attorney fees. Plaintiff appealed the "prevailing party" decision to the Supreme Court. e sought. The district court entered a judgment conferring to Oakes the amount awarded by the jury, but found that neither party was the prevailing party for purposes of costs or attorney fees. Upon review, the Supreme Court held that the district court abused its discretion by not finding Plaintiff to be the prevailing party. The case was remanded for a determination of costs and fees.

When Employee left his employment, Employee and Employer entered into a consulting agreement containing restrictive covenants prohibiting Employee from disclosing Employer's confidential information. After Employee purchased another competing company, Employer filed a motion alleging breach of the agreement and seeking a preliminary injunction to enforce the Agreement's covenants. The district court granted Employer's request, concluding that Employee had likely violated several provisions of the agreement and had misappropriated trade secrets in violation of Nevada's Uniform Trade Secrets Act. Employee then filed a motion to dissolve the preliminary injunction upon termination of the agreement, which the district court denied. The Supreme Court (1) affirmed the court's order granting preliminary injunctive relief; and (2) reversed the court's order denying Employee's motion to dissolve the injunctive provisions, finding that the court improperly relied on the terminated agreement in declining to dissolve the injunction and failed to make findings as to the continued existence of a trade secret and for what constitutes a "reasonable period of time" for maintaining an injunction under the Act.

The employer sought an early withdrawal from its obligation to make pension contributions to a multiemployer pension fund; it entered into a new collective bargaining agreement, six weeks before expiration of the existing agreement, that abrogated its obligation to make payments to the fund. The fund sued under the Employee Retirement Income Security Act of 1974, 29 U.S.C. 1145. The district court entered summary judgment in favor of the fund. The Seventh Circuit affirmed, rejecting an argument that the agreement was ambiguous in providing that the employer could not “prospectively” change its obligation.