Justia Contracts Opinion Summaries

Employees at C.H. Robinson Worldwide, Inc. jumped ship to join Traffic Tech, Inc. C.H. Robinson then sued five of those former employees and Traffic Tech, raising various state-law claims, including tortious interference with a contractual relationship. After the case was removed to federal court, the district court granted summary judgment in favor of the former employees and Traffic Tech. The district court also awarded attorney fees to the former employees and Traffic Tech   The Eighth Circuit affirmed the district court’s dismissal of Plaintiff’s claim for tortious interference with prospective economic advantage, reversed the judgment in all other respects, and vacated the district court’s order awarding attorney fees and costs. The court held that Minnesota law applies to the interpretation and enforceability of Defendants’ employment contracts. The court remanded for the district court to consider whether C.H. Robinson’s claims or disputes against Peacock arose in California or elsewhere under Peacock’s employment contract. The court further remanded for the district court to substantively analyze whether all or part of the former employees’ contracts are unenforceable and, if not, whether the claims for breach of contract and tortious interference with a contractual relationship survive summary judgment. View "C.H. Robinson Worldwide, Inc. v. Traffic Tech, Inc." on Justia Law

Mobile Infirmary Association d/b/a Mobile Infirmary Medical Center ("Mobile Infirmary") appealed the grant of summary judgment in favor of Quest Diagnostics Clinical Laboratories, Inc. ("Quest"). Quest and Mobile Infirmary entered into a Laboratory Management Agreement ("the LMA"), in which Quest agreed to manage Mobile Infirmary's onsite clinical laboratory facilities and to provide clinical testing services used by Mobile Infirmary's medical staff to diagnose and treat patients. The LMA also contained indemnity provisions. In 2015, James Ward went to Mobile Infirmary's emergency room after suffering weakness, dizziness, loss of fluids, a mild cough, and severe body aches. Ward was eventually diagnosed with diabetic ketoacidosis. When his condition did not improve, Ward was moved into the intensive-care unit, at which point his doctor ordered him to undergo glucose finger-sticks and a basic metabolic panel every four hours to help monitor his serum glucose, kidney function, acid/base status, and electrolytes. According to Mobile Infirmary, those basic metabolic panels were supposed to be performed by Quest, but they were allegedly canceled by one of Quest's employees. At some point, he suffered an "anoxic brain injury" and later died "as a result of multisystem organ failure secondary to severe sepsis and septic shock." Ingrid Mia Ward ("Mia"), Ward's wife and the personal representative of his estate, commenced a wrongful-death action against Mobile Infirmary and other defendants responsible for Ward's treatment and care. Quest was not named as a party to Mia's action. Mobile Infirmary informed Quest of the action and, as the case progressed, apprised Quest of the status of the proceedings, including its negotiations with Mia for potential settlement of the lawsuit. Mia and Mobile Infirmary ultimately settled the wrongful-death action. Before Mia's claims against Mobile Infirmary were dismissed pursuant to a joint motion of those parties, Mobile Infirmary filed a third-party complaint against Quest in which it sought contractual and equitable indemnity related to its defense and settlement of Mia's action. Quest filed a motion to dismiss, which the trial court granted in part by dismissing Mobile Infirmary's equitable- indemnity claim. The Alabama Supreme Court found that nowhere in the LMA did the parties expressly agree or clearly provide a formula that, in the event there was a claim that arises out of partial liability or concurrent acts by both parties, indemnification will be required for a proportionate share. Accordingly, judgment was affirmed. View "Mobile Infirmary Association v. Quest Diagnostics Clinical Laboratories, Inc." on Justia Law

In 2018, Albert Mione (“Mione”) was in a collision while operating his motorcycle. Mione’s motorcycle was insured by Progressive Insurance, under a policy that did not include UM/UIM coverage. Albert and his wife Lisa jointly owned a car, which was insured by Erie Insurance on a single-vehicle policy that included UM/UIM coverage with stacking. Mione’s adult daughter Angela also lived in the couple’s home, and she too owned a car, which Erie insured on a single-vehicle policy (“Angela’s policy”). Both of the Erie policies contained household vehicle exclusions barring UM/UIM coverage for injuries sustained while operating a household vehicle not listed on the policy under which benefits are sought. The courts below held that the exclusions were valid and enforceable, citing the Pennsylvania Supreme Court’s 1998 decision in Eichelman v. Nationwide Insurance Co., 711 A.2d 1006 (Pa. 1998). The Miones, contended that the lower courts erred in applying Eichelman, arguing that the Supreme Court sub silentio overruled that decision in Gallagher v. GEICO Indemnity Co., 201 A.3d 131 (Pa. 2019). The Supreme Court rejected the Miones’ argument, and affirmed. View "Erie Insurance Exch. v. Mione, et al." on Justia Law

In this dispute over an arbitration clause within a contract, the Supreme Court held that the minor children who joined Plaintiffs, their parents, in bringing this action seeking damages for construction defects in their home may be compelled to arbitrate along with their parents on the basis of direct-benefits estoppel.Plaintiffs, Tony and Michelle Ha, signed a purchase agreement with Taylor Woodrow Communities-League City, Ltd. to build a home in Texas. The agreement included an arbitration provision. The Has sued both Taylor Woodrow Communities-League City, Ltd. and Taylor Morrison of Texas, Inc., for negligent construction and other claims, alleging the home developed significant mold problems due to construction defects. Plaintiffs' second amended petition named both Tony and Michelle and their three children. Taylor Morrison moved to compel arbitration, but the trial court denied the motion as it pertained to Michelle and the children. The court of appeals affirmed. The Supreme Court reversed, holding that when a family unit resides in a home and files suit for factually intertwined construction-defect claims concerning the home, a nonsignatory spouse and minor children have accepted direct benefits under the signatory spouse’s purchase agreement such that they may be compelled to arbitrate through direct-benefits estoppel. View "Taylor Morrison of Texas, Inc. v. Ha" on Justia Law

In this dispute over an arbitration clause within a contract, the Supreme Court held that the minor children who joined Plaintiffs, their parents, in bringing this action seeking damages for construction defects in their home may be compelled to arbitrate along with their parents on the basis of direct-benefits estoppel.Plaintiffs, Jack and Erin Skufca, signed a purchase agreement with Taylor Woodrow Communities-League City, Ltd. to build a home in Texas. The agreement included an arbitration provision. Plaintiffs sued both Taylor Woodrow Communities-League City, Ltd. and Taylor Morrison of Texas, Inc., for construction defects and fraud, alleging that less than a year after they moved in, the home developed mold issues that caused their minor children to be ill. The petition listed Jack and Erin as plaintiffs individually, as well as Erin as next friend of the couple's children. Taylor Morrison moved to compel arbitration, but the trial court denied the motion as it pertained to the children. The court of appeals affirmed. The Supreme Court reversed, holding that the minor children sued based on the contract and were subject to its terms, including the arbitration clause. View "Taylor Morrison of Texas, Inc. v. Skufca" on Justia Law

Plaintiff, an investor and venture capitalist and the CEO of InterOil Corporation (“InterOil”), developed a business relationship. Throughout that relationship, Plaintiff (and “entities controlled and beneficially owned by him”) provided loans, cash advances, and funds to the CEO and InterOil. Plaintiff and the CEO continued to have a business relationship until 2016, at which point the CEO’s actions and words made Plaintiff concerned he would not receive his shares back from the CEO. In late 2017, as part of a larger suit against the CEO, Plaintiff and Aster Panama sued the J.P. Morgan Defendants for (1) breach of trust and fiduciary duty, (2) negligence, and (3) conspiracy to commit theft. The district court granted summary judgment on all counts relating to the J.P. Morgan defendants and awarded them attorneys’ fees under the Texas Theft Liability Act (“TTLA”).   The Fifth Circuit affirmed. Under Texas law, the only question is whether the J.P. Morgan Defendants expressly accepted a duty to ensure the stocks were kept in trust for Plaintiff or Aster Panama. That could have been done by express agreement or by the bank’s acceptance of a deposit that contained writing that set forth “by clear direction what the bank is required to do.” Texas courts require a large amount of evidence to show that a bank has accepted such a duty. Here, no jury could find that the proffered statements and emails were sufficient evidence of intent from the J.P. Morgan Defendants to show an express agreement that they “owe[d] a duty to restrict the use of the funds for certain purposes.” View "Civelli v. J.P. Morgan Chase" on Justia Law

In a case involving the denial of coverage for an automobile accident, the Fifth Circuit addressed whether uninsured motorist coverage can be denied simply because the driver, who was the son of the insured, was not listed on the policy? The court answered that question “no.” The other is whether the policy can be voided because the insured committed a material misrepresentation by failing in her application for insurance to name, as required, those of driving age who lived in her household? The court answered that question, “yes.”   The Fifth Circuit affirmed the district court’s ruling granting Viking Insurance’s motion for summary judgment in Plaintiffs’ suit seeking damages for a wrongful denial of benefits. The court concluded that if an insurer declines to exercise the greater power to void a policy, it still retains the lesser power to exercise a contractual right to deny coverage. The court explained that here, a knowing misstatement in the application about the drivers in the household was material if it would have caused Viking either not to issue the policy or to increase the premium. The court accepted that materiality is not affected by the relationship between the false statement and the specific coverage being sought in litigation. It is enough that the falsity was material to the decision of the company to issue the policy at the agreed price. Consequently, Viking could have voided the policy. By not voiding, Viking’s policy remained in effect. Accordingly, Viking had the right to deny Plaintiffs’ claim. View "Bradley v. Viking Insurance" on Justia Law

The Supreme Court affirmed the judgment of the district court in favor of a group of eastern Montana farmers (Farmers) and against four affiliates of USA Biofuels, LLC (Affiliates) on Farmers' claims on a variety of contract and tort theories, holding that there was no error.In 2018, Farmers entered individual written contracts with USA Biofuels to grow 10,000 acres of hemp. Farmers brought this action alleging that they never received full payment from Defendants, including USA Biofuels and various affiliates. The district court concluded on summary judgment that USA Biofuels breached its contract and awarded damages. Farmers subsequently abandoned their contract claims and secured a tort judgment against Affiliates. The Supreme Court affirmed, holding that the district court (1) did not abuse its discretion when it entered judgment on the punitive damages award; (2) did not err in instructing the jury; and (3) did not err in ruling on summary judgment that three shareholders were alter egos of USA Biofuels. View "Romo v. USA Biofuels, LLC" on Justia Law

Appellants, who were maimed in a hot air balloon accident in southeastern Pennsylvania in 2015, pursued appellate challenges to the District of Maryland’s rulings against them and in favor of T.H.E. Insurance Company (the “Insurer”) in an insurance coverage dispute. In federal court proceedings initiated in Maryland, Appellants sued certain of the Insurer’s named insureds, and a business called New Horizon Balloon Team (collectively, the “Insureds”) — for the gruesome injuries Appellants’ sustained in the balloon accident (the “damages lawsuit”). While the damages lawsuit was pending, the Insurer initiated these insurance coverage proceedings in the Eastern District of Pennsylvania, naming as defendants the three Insureds, plus Appellants. The district court awarded summary judgment in favor of the Insurer’s contention with respect to a $100,000 coverage limit for each balloon passenger. The Memorandum Opinion also rejected both of Appellants’ bad faith claims. Appellants appealed those rulings.   The Fourth Circuit affirmed. Applying Maryland principles of res judicata in this dispute, the court was satisfied that the coverage issue presented by the Insurer in these proceedings is not barred by the settlement agreement in the damages lawsuit. As such, the court agreed with the district court that Appellants are not entitled to a summary judgment award on the coverage issue on res judicata grounds. Further, the district court thus did not err in ruling Appellants were inside the balloon’s basket at the time of their injuries. As such, Appellants were “passengers” under the Policy and Coverage B’s limit of $100,000 per passenger applies. View "T.H.E. Insurance Company v. Melyndia Davis" on Justia Law

This dispute over UM coverage arose from a motor vehicle accident wherein an uninsured motorist struck and killed Macy Lee Alvey, III, who was in the course and scope of his employment with Rony’s Towing & Recovery, LLC (“Rony’s Towing”). The Louisiana Supreme Court granted this writ to determine whether the failure to include the insurer’s name on an uninsured/underinsured motorist (“UM”) coverage selection form rendered it invalid. Because inclusion of the insurer’s name was an express requirement on the face of the UM form itself, the Supreme Court agreed with the court of appeal that the failure to include such information resulted in an invalid waiver of coverage. View "Berkeley Assurance Co. v. Willis, et al." on Justia Law