Justia Contracts Opinion Summaries

Articles Posted in Transportation Law
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In this case, a woman was severely injured while moving an inoperable airplane owned by her husband. She sought recovery from her husband's homeowner's insurance policy. The insurance policy, however, excluded injuries "arising out of" the ownership, maintenance, use, loading or unloading of an aircraft. The woman argued that the policy should cover her injury because, in her view, the aircraft had become mere "parts" after her husband removed the wings, elevators, and tail rudder. The lower court disagreed and concluded that her injuries were not covered by the policy. The woman appealed this decision.The Supreme Court of the State of Alaska agreed with the lower court’s interpretation of the homeowner's insurance policy exclusion. The court maintained that regardless of whether the airplane was considered an aircraft or a collection of airplane “parts” when it injured the woman, the injury arose out of the husband’s ownership of the airplane. This interpretation was supported by the clear language of the policy which excluded coverage for bodily injury arising out of ownership or maintenance of an aircraft. As a result, the court affirmed the lower court’s decision. View "Thompson v. United Services Automobile Association" on Justia Law

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CSX Transportation, Inc. is a freight railroad company. General Mills, Inc. operates a cereal processing plant in Georgia near one of CSX’s rail lines. A small connecting railroad connects CSX’s main rail line to General Mills’s plant. A contract between CSX and General Mills governs the use of the sidetrack.A General Mills employee suffered severe injuries while working on the sidetrack and then sued CSX for negligence. A jury found CSX liable, and CSX sought indemnification from General Mills, citing a contractual provision providing General Mills was required to indemnify CSX—regardless of whether CSX alone was responsible. The district court dismissed one of CSX’s breach-of-contract claims and granted General Mills summary judgment on the other.The Eleventh Circuit found that, under the parties’ agreement, General Mills was not required to indemnify CSX if CSX was solely negligent. However, the court disagreed with the district court that Georgia's vouchment doctrine barred CSX from litigating the issue of General Mills’s negligence. Thus, the Eleventh Circuit remanded for the district court to determine if General Mills was at least partially at fault for the injury. If so, then General Mills must indemnify CSX for at least a portion of the settlement and related expenses. View "CSX Transportation, Inc. v. General Mills, Inc." on Justia Law

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The First Circuit affirmed the judgment of the district court in favor of the Puerto Rico Highways and Transportation Authority (PRHTA) and its executive directors (collectively, Appellees) and dismissing this complaint brought by sixty-nine current and former employees of the PRHTA (collectively, Appellants), holding that the district court did not err or abuse its discretion.Appellants brought this action challenging the PRHTA's decision no longer to give effect to a regulation providing Appellants with additional compensation. Specifically, Appellants claimed that the decision was contrary to P.R. Act No. 66-2014, giving rise to violations of the Contracts Clause and Due Process Clause. The district court granted summary judgment for the PRHTA on the federal constitutional claims and declined to exercise supplemental jurisdiction over Appellants' claims under Puerto Rico law. The First Circuit affirmed, holding that the district court (1) did not err in concluding that Appellants could not establish their federal constitutional claims; and (2) did not abuse its discretion in declining to exercise jurisdiction over Appellants' remaining Puerto Rico law claims. View "Vazquez-Velazquez v. P.R. Highway & Transportation Authority" on Justia Law

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Norfolk Southern Railway Company (Norfolk Southern) petitioned for review of a decision of the Surface Transportation Board (STB or Board), the successor agency to the Interstate Commerce Commission (ICC) charged with authorizing certain rail carrier transactions under the Interstate Commerce Act. Norfolk Southern is a rail carrier that owns a 57.14 percent share of the Norfolk & Portsmouth Belt Line Railroad Company (Belt Line), the operator of a major switching terminal in Norfolk, Virginia. Norfolk Southern’s majority interest goes back to 1982, when its corporate family acquired and consolidated various rail carriers with smaller ownership interests in the Belt Line. Norfolk Southern’s competitor, CSX Transportation, Inc. (CSX), owns the remainder of the Belt Line’s shares (42.86 percent). This case involves a different question raised before the Board for the first time:  whether the ICC/Board approvals of Norfolk Southern’s subsequent corporate-family consolidations in 1991 and 1998 authorized Norfolk Southern to control the Belt Line. The Board again answered no. Norfolk Southern petitioned for review.   The DC Circuit affirmed. The court concluded that the Board’s decision regarding the 1991 and 1998 transactions is neither arbitrary nor capricious. The Board reasonably sought to avoid an absurd interpretation of 49 C.F.R. Section 1180.2(d)(3)’s corporate-family exemption that would allow a carrier to gain control of a new entity without following the Board’s review requirements and then “cure that unauthorized acquisition by reorganizing the corporate family.” The Board reasonably rejected Norfolk Southern’s claim that, by reshuffling the pieces of its corporate family, it acquired control authority of the Belt Line sub silentio. View "Norfolk Southern Railway Company v. STB" on Justia Law

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The Court of Appeals affirmed the judgment of the Appellate Division dismissing Plaintiffs' claims that Taxi and Limousine Commission and New York City breached the implied covenant of good faith and fair dealing and engaged in deceptive business practices under N.Y. Gen. Bus. Law 349, holding that Plaintiffs failed to state a claim.Plaintiffs, entities that purchased government licenses to operate taxis at an auction, brought this action alleging that Defendants (1) breached the implied covenant of good faith and fair dealing by failing to enforce certain licensing requirements against smartphone applicate-based competitors such as Uber Technologies, Inc. and Lyft, Inc.; and (2) engaged in deceptive business practices in their promotion of the auction. Supreme Court granted in part Defendants' motion to dismiss. The Appellate Division reversed in part and concluded that both claims should be dismissed. The Court of Appeals affirmed, holding (1) Plaintiffs did not adequately plead a claim for breach of the implied covenant of good faith and fair dealing; and (2) Plaintiffs failed to plead the type of conduct covered by N.Y. Gen. Bus. Law 349. View "Singh v. City of New York" on Justia Law

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Plaintiff, an African American woman, worked as a conductor for Amtrak National Railroad Passenger Corporation (Amtrak). During her employment, she belonged to a division of the Sheet Metal, Air, Rail and Transportation Workers (SMART) union, which maintained a collective bargaining agreement (CBA) with Amtrak. Plaintiff brought the instant lawsuit pro se. She named Amtrak and the company’s director of employee relations as Defendants, along with three other Amtrak colleagues. Plaintiff asserted state-law claims of breach of contract and tort, as well as a federal claim of racial discrimination in violation of Title VII. Defendants moved to dismiss, and Plaintiff moved for summary judgment as well as for leave to amend her complaint. The district court granted Defendants’ motion and denied Plaintiff’s two motions. The district court held that Plaintiff’s claims were subject to arbitration under the Railway Labor Act (RLA).   The Fourth Circuit affirmed. The court explained that it declines to unwind a statutory scheme without a clear congressional directive to do so. Plaintiff argued that at least her particular claim is not a minor dispute. The mere fact that Plaintiff’s claim arises under Title VII does not disqualify that claim from being a minor dispute within the RLA’s ambit. The thrust of Plaintiff’s Title VII claim is that Amtrak deviated from its policies when dealing with her. While Plaintiff’s allegations as to her own treatment are factual, those concerning Amtrak’s policies directly implicate the relevant CBA between Plaintiff’s union, SMART, and Amtrak. That some of Plaintiff’s interpretive disagreements concern the Drug-Free Program does not alter the character of her claim. View "Dawn Polk v. Amtrak National Railroad Passenger Corporation" on Justia Law

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Plaintiff sued Uber under the Private Attorneys General Act of 2004 (PAGA), claiming Uber willfully misclassified him as an independent contractor rather than an employee, which led to numerous other Labor Code violations. In response, Uber moved to compel arbitration under the “Arbitration Provision” in the “Technology Services Agreement” (TSA).The trial court denied Uber's motion and the Second Appellate District affirmed. However, in June 2022, the U.S. Supreme Court vacated the decision when it granted Uber's petition for certiorari in light of Viking River Cruises, Inc. v. Moriana (2022) ___ U.S. ___ [142 S.Ct. 1906, 213 L.Ed.2d 179] (Viking River).Following this posture, the Second Appellate District held 1.) the TSA’s PAGA Waiver is invalid and must be severed from the Arbitration Provision; 2.) under the Arbitration Provision’s remaining terms, Plaintiff must resolve his claim for civil penalties based on Labor Code violations he allegedly suffered in arbitration, and his claims for penalties based on violations allegedly suffered by other current and former employees must be litigated in court; and 3.) under California law, Plaintiff is not stripped of standing to pursue his non-individual claims in court simply because his individual claim must be arbitrated. View "Gregg v. Uber Technologies, Inc." on Justia Law

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The Professional Airline Flight Control Association complained that Spirit is attempting to change its agreement. Spirit responded that its unilateral decision to open a second operations control center is permitted by the parties’ agreement. The district court agreed with Spirit that this dispute is minor and dismissed the action for lack of subject-matter jurisdiction.   The Eleventh Circuit affirmed. The court explained that the Railway Labor Act, 45 U.S.C. Section 151 et seq., divides labor disputes into two categories: disputes over the interpretation of an existing agreement are “minor” and resolved exclusively through binding arbitration, and disputes over proposed changes to an agreement or over a new agreement are “major” and addressed through bargaining and mediation. During a major dispute, district courts have subject-matter jurisdiction to enjoin violations of the status quo. But district courts ordinarily lack jurisdiction over minor disputes. Accordingly, the court affirmed the district court’s dismissal. View "Professional Airline Flight Control Association v. Spirit Airlines, Inc." on Justia Law

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The City of Carthage sued Union Pacific Railroad Co. for breach of contract, claiming UP failed to maintain several bridges. On summary judgment, the district court ruled that the City’s breach-of-contract claim was barred by the five-year statute of limitations. The City argues that the ten-year statute of limitations applies here because its claim seeks an equitable remedy.   The Eighth Circuit affirmed. The court explained that the City’s claim accrued in February 2013, at the latest. On February 15, 2013, the City wrote UP demanding the repair of the bridges—establishing that the City was on notice of a potentially actionable injury. The City waited until 2019—over five years later—to sue UP. The City’s claim is barred by the five-year statute of limitations. Further, here, UP did not engage in any affirmative act during the limitations period. Without more, a failure to act does not justify the continuing wrong rule. View "City of Carthage, Missouri v. Union Pacific Railroad Co." on Justia Law

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Union Pacific Railroad Company (“Union Pacific”) sought to end its operations in Palestine, Texas but has been unable to do so because of a 1954 Agreement between its predecessor and Defendants City of Palestine (“Palestine”) and Anderson County, Texas (“Anderson County”) has prevented it from leaving.   Union Pacific filed a motion for summary judgment, which the district court granted, holding that the 1954 Agreement was expressly and impliedly preempted. After the district court entered judgment, Palestine and Anderson County filed suit in Texas state court seeking to enforce the 1955 Judgment which had approved the 1954 Agreement.   Defendants appealed the district court’s grant of summary judgment for Union Pacific and the denials of their motion to dismiss for failure to join a necessary party, motion for judgment on the pleadings, and cross-motion for summary judgment.   The Fifth Circuit affirmed the district court’s ruling granting summary judgment for Union Pacific after determining that federal law preempts the statutorily mandated contractual agreements between the parties, both expressly and as applied. The court explained that there is no requirement for contemporaneous movement of property related to the rails for the regulation to be preempted. If the facilities or services—in any non-incidental way—relate to the movement of property by rail, they are preempted by the ICCTA.  Further, the court held that the district court properly determined that the Anti-Injunction Act does not bar Union Pacific from seeking declaratory relief. View "Union Pac. RR v. City of Palestine" on Justia Law