Justia Contracts Opinion Summaries

Plaintiff-Appellant Dr. John Noak was dismissed as the medical director for Prison Health Services, Inc. (PHS). He appealed the district court's grant of summary judgment in favor of the Idaho Department of Correction (IDOC) on claims of breach of an implied covenant of good faith, intentional and negligent infliction of emotional distress, defamation, and intentional interference with contract. A 2004 investigation into how Plaintiff treated a female inmate at an IDOC facility lead to IDOC demanding that PHS replace Plaintiff as medical director. Finding no error in the district court's judgment, the Supreme Court affirmed the grant of summary judgment in favor of IDOC.

Plaintiff, a former police officer, filed an action against Defendants, the Town of Portsmouth, its then chief of police, and a now retired lieutenant, alleging several causes of action arising from an investigation into Plaintiff's conduct during an officer training exercise. The superior court entered judgment in favor of Defendants. The Supreme Court affirmed in part and vacated in part, holding (1) the trial justice properly granted judgment as a matter of law in favor of Defendants on the claims of malicious prosecution and tortious interference with contractual relations; but (2) the trial justice erred by granting Plaintiff's R.I. R. Civ. P. 12(b)(6) motion to dismiss the chief of police and lieutenant's counterclaim for defamation arising from an inflammatory letter that Plaintiff submitted to the town council to notify the council of his forthcoming suit in accordance with R.I. Gen. Laws 45-15-5 where (i) absolute privilege did not apply in this instance because the notice required by section 45-15-5 was not part of a judicial or quasi-judicial proceeding, and (ii) baseless claims and allegations made by parties who must provide notice under section 45-15-5 are not protected by absolute immunity under McDonald v. Smith. Remanded.

After Hospital declined to renew the privileges of Physician due to repeated complaints about Physician, Physician sued for damages. Hospital claimed immunity under the Health Care Quality Improvement Act (HCQIA). The circuit court granted summary judgment to Hospital, and the court of special appeals affirmed. The Court of Appeals granted certiorari to answer whether in the context of a summary judgment proceeding, the presumption of HCQIA immunity is rebutted upon the showing of material facts in dispute regarding the physician's reporting of substandard medical care and attempts to improve the quality of the care in the hospital system. The Court affirmed, holding (1) evidence of retaliation will not prevent summary judgment on HCQIA immunity unless it can permit a rational trier of fact to conclude that (i) the defendant failed to comply with the standards for immunity set forth in 42 U.S.C. 11112(a), or (ii) the action was not a "professional review action" under 42 U.S.C. 11151(9); and (2) in this instance, Physician did not produce evidence sufficient to convince a rational trier of fact that Hospital failed to satisfy the standards for immunity set forth in HCQIA, and therefore, summary judgment was warranted.

In 2004, Doctor informed Employer, a medical clinic, that he planned to exercise his rights under Employer's policy that rewarded length of service by giving benefits to physicians who were sixty years old or older and had at least fifteen years of taking night calls. Doctor agreed to postpone exercising his rights under the policy until the next year. In 2005, Employer told Doctor that the policy no longer existed. Doctor later withdrew from taking night call. As a result, Employer reduced Doctor's salary. In 2009, sued Employer for breach of contract and promissory estoppel, claiming Employer breached the policy by refusing to allow him to be exempt from night call without salary reduction. The district court granted Employer's motion to dismiss, holding that the two-year statute of limitations began to run in 2005 when Employer informed Doctor it would not honor its obligations under the policy. The court of appeals reversed, concluding that a new cause of action accrued each time a payment was due but not paid. The Supreme Court reversed, holding that Doctor's cause of action accrued, and the statute of limitations began to run, in 2005, and therefore, Doctor's claim was barred by the statute of limitations.

Plaintiff sued the Union for damages caused by a work stoppage conducted by the Union in alleged violation of the collective bargaining agreement. The district court entered summary judgment without reaching the merits holding that the dispute was subject to arbitration under the contract. Plaintiff appealed. The court held that, in this case, the employee oriented grievance machinery in the parties' contract qualified and limited the universe of claims and grievances subject to arbitration, and the language negated the intention that the employer's claim for damages must be submitted to arbitration. Accordingly, the district court's grant of summary judgment was reversed and the case remanded for further proceedings.

Plaintiff sells, installs, and services fire extinguishers and fire suppression and fire alarm systems, which it designs for commercial customers. Defendant Garcia, hired as a systems technician in 1992, became a sales person. In 1997 he signed a noncompetition agreement. Defendant Arredondo, a salesperson, signed a noncompetition agreement about a week after being hired in 1998. The agreement prohibited competition during their employment and for one year after termination in Illinois, Indiana, or Wisconsin and prohibited solicitation of plaintiff's customers, referral sources, and employees. In 2004 defendants formed a competing company; Arredondo resigned, Garcia was fired. The trial court found the covenants unenforceable and a divided appellate court affirmed. The Illinois Supreme Court remanded. Assessment of a covenant includes analysis of the employer's legitimate business interest, based on the totality of the circumstances.Factors include, but are not limited to, the near-permanence of customer relationships, the employee’s acquisition of confidential information through his employment, and time and place restrictions. No factor carries any more weight than any other,

This case arose when Cat Tech sought indemnification from its insurers after Cat Tech damaged several components of a hyrotreating reactor owned by Ergon Refining, Inc. and arbitrators entered an award against Cat Tech for the damage. Insurers subsequently denied the claim, contending, inter alia, that the "your work" exclusion found in the policies precluded coverage for damage to the reactor. The district court found that insurers had no duty to indemnify Cat Tech. The court held that the information contained in the arbitration award was insufficient to properly apply the "your work" exclusion. As such, the court concluded that the district court erred when it relied on the award in granting insurer's summary judgment motion. On remand, the district court should conduct any additional fact-finding necessary to determine whether the damage suffered by Ergon's reactor was limited only to those components upon which Cat Tech worked, or instead included other components unrelated to Cat Tech's operations. Accordingly, the judgment was reversed and the case remanded for further proceedings.

The underlying dispute in this appeal revolved around the issue of who was contractually obligated to pay workers' compensation benefits to an employee of Employer. The Supreme Court found that Employer's Insurer was required to pay workers' compensation benefits for all of Employer's employees and remanded the case. The district court entered a final judgment. Instead of filing a notice of appeal within thirty days of the district court's judgment, Insurer filed an "objection to judgment." Insurer then filed its notice of appeal within thirty days of the district court's order disposing of that motion. The Supreme Court dismissed the appeal, holding that it lacked jurisdiction to address the appeal as (1) Insurer did not file its notice of appeal within thirty days of the district court's final judgment, and (2) Insurer failed to file a postjudgment motion that would toll the time for appeal or one that the Court had jurisdiction to review.

Plaintiffs commenced a diversity action against defendant, asserting claims for breach of the insurance contract and for vexatious refusal to pay. Applying Missouri law, the district court granted defendant summary judgment, concluding that the insurance policy at issue unambiguously excluded losses caused by plaintiffs' CEO, a shareholder, and by plaintiffs' COO, a non-shareholder, acting in collusion with the CEO. The court affirmed and held that the Officer-Shareholder exclusion was consistent with Missouri public policy, and in the alternative, the Officer-Shareholder exclusion was unambiguous and excluded plaintiffs' claim.

Eric Spannbauer, a police officer with the North Las Vegas Police Department, was asked to resign by the City Police Department Association. Spannbauer resigned, signing a letter of agreement prepared by the Department. Spannbauer later filed a complaint with the Employee-Management Relation Board (EMRB) against the Association, the City, and the Department, alleging multiple prohibited practices in violation of Nev. Rev. Stat. 288, including gender discrimination. The EMRB found that the City and Department had committed prohibited labor practices and that the Association had breached its duty of fair representation. The City and the Department petitioned the district court for judicial review, which the district court denied. The City, on behalf of itself and the Department, filed an appeal. The Supreme Court affirmed, holding that there was substantial evidence to support the EMRB's finding that the City and Department discriminated against Sannbauer on the basis of his gender in violation of Nev. Rev. Stat. 288.110(1)(f); and (2) the EMRB appropriately disregarded the resignation agreement, including the covenant not to sue, as there was substantial evidence that the agreement was a culmination of prohibited practices in violation of Nev. Rev. Stat. 288.270(1).