Justia Contracts Opinion Summaries

Plaintiffs, E&I Global Energy Services, Inc. and E&C Global, LLC, sued Liberty Mutual Insurance Company for breach of contract and tort claims related to a construction project. The United States, through the Western Area Power Administration (WAPA), contracted with Isolux to build a substation, and Liberty issued performance and payment bonds for Isolux. After Isolux was terminated, Liberty hired E&C as the completion contractor, but E&I performed the work. Plaintiffs claimed Liberty failed to pay for the work completed.The United States District Court for the District of South Dakota granted summary judgment for Liberty on the unjust enrichment claim and ruled in Liberty's favor on all other claims after a bench trial. The court denied Plaintiffs' untimely request for a jury trial, excluded an expert witness report filed after the deadline, found no evidence of an assignment of rights between E&C and E&I, and ruled against Plaintiffs on their fraud, deceit, and negligent misrepresentation claims.The United States Court of Appeals for the Eighth Circuit reviewed the case. The court held that the district court did not abuse its discretion in denying the jury trial request, as Plaintiffs failed to timely file the motion and did not justify the delay. The exclusion of the expert report was also upheld, as the district court properly applied the relevant factors and found the late report was neither substantially justified nor harmless. The court affirmed the district court's finding that there was no valid assignment of rights from E&C to E&I, meaning Liberty's promise to pay was to E&C, not E&I. The court also upheld the findings that Liberty did not have the intent to deceive or induce reliance, and that Bruce did not reasonably rely on Mattingly's statements. Finally, the court declined to address the unjust enrichment claim as Plaintiffs did not raise the argument below. The Eighth Circuit affirmed the district court's rulings in their entirety. View "E&I Global Energy Services v. Liberty Mutual Insurance Co." on Justia Law

Cedar Hills Investment Co., L.L.C. leased part of the ground under the Battlefield Mall in Springfield, Missouri, to Battlefield Mall LLC. Cedar Hills suspected that Battlefield was improperly deducting certain costs from revenue-sharing payments owed under the lease. Cedar Hills sued Battlefield, and the district court found that Battlefield had improperly deducted capital expenditures and some administrative costs from shared revenue. The court approved the deduction of security costs and other administrative costs but held that Battlefield failed to state charges to subtenants for deducted costs separately as required by the lease. Cedar Hills was awarded approximately $3.5 million in damages.The United States District Court for the Western District of Missouri held a bench trial and ruled in favor of Cedar Hills on several points, including the improper deduction of capital expenditures and the failure to separately state charges. However, the court also found that Battlefield's deduction of security costs was permissible.The United States Court of Appeals for the Eighth Circuit reviewed the case and affirmed the district court's findings regarding the improper deduction of capital expenditures and the failure to separately state charges. However, the appellate court found that the district court misidentified which administrative costs were deductible and miscalculated Cedar Hills's damages. The Eighth Circuit held that Battlefield's deduction of capital expenditures breached the lease, and the failure to separately state charges also breached the lease. The court affirmed the district court's finding that security costs were common area maintenance costs. The case was remanded for further proceedings to correctly identify deductible administrative costs and recalculate damages. The appellate court granted the parties' joint motion to supplement the record. View "Cedar Hills Investment Co. v. Battlefield Mall, LLC" on Justia Law

Barton Hankins was hired by Crain Automotive Holdings, LLC in 2019 as Chief Operating Officer and was offered a deferred compensation plan (DCP). After four years, Hankins resigned and sought compensation under the DCP, which Crain denied. Hankins then filed a lawsuit under the Employee Income Retirement Security Act of 1974 (ERISA) to claim his benefits. The DCP stipulated that Hankins could earn a percentage of Crain’s fair market value upon his exit, with full vesting at five years. Having served four years, Hankins was entitled to 80% of the benefits.The United States District Court for the Eastern District of Arkansas granted judgment in favor of Hankins, concluding that the DCP did not require the creation of an Employment Agreement or a Confidentiality, Noncompete, and Nonsolicitation Agreement for enforceability. The court found that Crain’s claims of misconduct by Hankins were unsubstantiated and awarded Hankins attorney’s fees, determining that Crain’s conduct was sufficiently culpable.The United States Court of Appeals for the Eighth Circuit reviewed the case. The court affirmed the district court’s judgment, holding that Crain’s interpretation of the DCP was unreasonable. The court found that the DCP’s Article 4, which mentioned the Employment and Confidentiality Agreements, did not create a condition precedent but rather a condition subsequent. The court also upheld the award of attorney’s fees, noting that Crain’s actions lacked merit and were raised only after Hankins sought his vested compensation. The appellate court concluded that the district court did not abuse its discretion in its rulings. View "Hankins v. Crain Automotive Holdings, LLC" on Justia Law

First Baptist Church, located in Fort Smith, Arkansas, had property insurance policies with Zurich American Insurance Company. The church experienced leaks over the years and hired roofing companies to repair portions of its roofing system in 2016, 2017, and 2018. In 2022, a roofing company representative determined the roofing system had hail damage, and First Baptist filed a claim with Zurich, alleging the damage occurred on April 28, 2017. Zurich denied the claim, citing no damage from the alleged hail event and evidence of excluded causes such as wear and tear. First Baptist sued Zurich for breach of contract and insurance bad faith.The United States District Court for the Western District of Arkansas granted summary judgment in favor of Zurich, concluding that First Baptist failed to comply with the prompt notice provision in the insurance policy. The court based its decision on evidence first discussed in Zurich’s reply brief, which indicated that First Baptist knew of past loss or damage to its property as early as 2016. The court held that no reasonable jury could find that First Baptist promptly notified Zurich of the loss or damage nearly six years later in January 2022. First Baptist filed a motion to reconsider, which the district court denied.The United States Court of Appeals for the Eighth Circuit reviewed the case and concluded that there were potential genuine disputes of material fact not properly litigated. The court noted that First Baptist did not have a fair opportunity to counter Zurich’s evidence and arguments about past leaks and repairs. The court reversed the district court’s grant of summary judgment and remanded the case for further consideration of the issues related to past loss or damage and the effect on First Baptist’s claims. The court also reversed and remanded the grant of summary judgment on First Baptist’s bad faith claim. View "First Baptist Church v. Zurich American Insurance Co." on Justia Law

Sioux Steel Company, a South Dakota corporation, designed and manufactured a new line of hopper bins for grain storage. After selling one of these bins to a distributor in Mexico, the bin failed catastrophically, causing fatalities and property damage. Sioux Steel had an insurance policy with the Insurance Company of the State of Pennsylvania (ISOP), which included a professional services exclusion. ISOP denied coverage based on this exclusion, leading Sioux Steel to settle with the affected party without ISOP's involvement.The United States District Court for the District of South Dakota granted summary judgment in favor of ISOP, finding that the professional services exclusion in the insurance policy was unambiguous and applicable, thus precluding coverage. The court also dismissed Sioux Steel's claims for bad faith, punitive damages, and attorney's fees.The United States Court of Appeals for the Eighth Circuit reviewed the case de novo. The court affirmed the district court's decision, holding that the professional services exclusion was clear and unambiguous. The exclusion applied because the damage arose from professional engineering services provided by Sioux Steel's employee and an external engineering firm. The court also found that ISOP did not breach its duty to defend, as no civil proceeding or alternative dispute resolution process had been initiated with ISOP's consent. Consequently, Sioux Steel's claims for breach of contract and insurance bad faith were dismissed, and the district court's judgment was affirmed. View "Sioux Steel Company v. Ins. Co. of the State of PA" on Justia Law

CEZ Prior, LLC ("CEZ") entered into a purchase agreement with 755 N Prior Ave., LLC ("Prior") to buy a property for $26 million. The agreement required Prior to cooperate in obtaining tenant estoppel certificates. Errors in square footage measurements led to rent discrepancies, prompting an amendment to reduce the purchase price to $15.1 million and the cash required at closing to $3.8 million. CEZ later requested to delay closing due to financial issues, but Prior did not agree. Prior sent estoppel certificates that did not address rate increases, and CEZ proposed edits that Prior rejected. CEZ demanded satisfactory certificates on the closing date, but Prior terminated the agreement, alleging CEZ failed to tender cash.CEZ sued Prior for breach of contract in Minnesota state court and sought to enjoin the termination. Prior removed the case to federal court and counterclaimed for breach of contract. The district court stayed the matter and later denied CEZ's motion for a preliminary injunction.The United States Court of Appeals for the Eighth Circuit reviewed the district court's denial of the preliminary injunction. The court found that CEZ was unlikely to succeed on the merits of its breach of contract claim, as Prior had reasonably cooperated in obtaining the estoppel certificates. The balance of harms favored Prior, given CEZ's insufficient evidence of its ability to pay. The public interest did not favor CEZ due to its low probability of success on the merits.The court also addressed CEZ's argument under Minnesota law, finding that the district court's stay order was not an injunction and did not extend statutory deadlines. Consequently, CEZ was not entitled to additional time to close under Minnesota statutes. The Eighth Circuit affirmed the district court's judgment. View "CEZ Prior, LLC v. 755 N Prior Ave. LLC" on Justia Law

Monsanto Company, Pharmacia, LLC, and Solutia, Inc. (collectively, "Monsanto") filed a lawsuit in St. Louis County Circuit Court in Missouri against Magnetek, Inc., General Electric Co. ("GE"), Paramount Global, KYOCERA AVX Components Corporation, Cornell Dubilier Electronics, Inc., and The Gillette Company LLC (collectively, "Defendants"). Monsanto alleged that it continues to incur substantial costs to defend against PCB lawsuits that should be borne by Defendants and sought to enforce written agreements obligating Defendants to defend, indemnify, and hold Monsanto harmless in all currently pending and future PCB lawsuits.GE removed the action to federal court, asserting jurisdiction under the federal officer removal statute, 28 U.S.C. § 1442(a)(1). The United States District Court for the Eastern District of Missouri granted Monsanto’s motion to remand, finding that GE's removal was untimely. GE appealed the decision.The United States Court of Appeals for the Eighth Circuit reviewed the case. The court found that the parties had waived Missouri Supreme Court Rule 54.13(c)’s personal service provision and expressly agreed that January 31, 2023, was the effective date for service of process. The court determined that the 30-day removal period began on the agreed effective date of service, not when GE signed the acknowledgment and waiver of service of process or when Monsanto filed the document. Consequently, GE's notice of removal was filed within the 30-day period, making the removal timely.The Eighth Circuit vacated the district court’s order of remand and remanded the case for further proceedings consistent with its opinion. The court declined to address whether GE satisfies the government contractor requirement of 28 U.S.C. § 1442(a)(1), as this issue was not addressed by the district court. View "Monsanto Company v. General Electric Co." on Justia Law

Plaintiff filed suit against Scottsdale for coverage under a Business and Management Indemnity Policy. The Eighth Circuit affirmed the district court's grant of summary judgment to Scottsdale, holding that Food Market presented no evidence providing notice over seven months was "as soon as practicable." Where, as here, notice is a condition precedent to coverage, a showing of prejudice was not required. Finally, the district court properly found the policy unambiguous; Scottsdale expressly relied on the notice provision when denying coverage; and there was no waiver. View "Food Market Merchandising v. Scottsdale Indemnity" on Justia Law

Plaintiffs filed a class action against the Pegasus Pipeline's current owners and operators, Exxon, alleging that the company's operation of the pipeline was unreasonable and unsafe. The Eighth Circuit agreed with the district court's decision to decertify the class based on a lack of commonality of issues. In this case, the contract claims would require examination of how Exxon's operation of the pipeline affects plaintiffs, which varies depending on where individual class members' property was located, as well as many other factors. The Eighth Circuit also concluded that the evidence here was insufficient to raise a genuine issue of material fact as to whether there was unreasonable interference. The court explained that the question of unreasonable use of an easement was generally one of fact, dependent on the nature of the easement, the terms of the grant, and other relevant circumstances. Finally, the district court did not clearly abuse its discretion by denying plaintiffs' motion to alter or amend the judgment where the additional evidence at issue would not have produced a different result. Accordingly, the Eighth Circuit affirmed the judgment. View "Webb v. Exxon Mobil" on Justia Law

Hanzada, an Egyptian company that imports and exports beef, appealed the jury verdict and judgment against it on plaintiff's breach of contract claim. The district court relied on the Seventh Circuit's widely adopted Sadat v. Mertes rule that only the American nationality of the dual citizen should be recognized for purposes of 28 U.S.C. 1332(a). The court concluded that the district court properly found diversity jurisdiction because plaintiff was a U.S. citizen and his Egyptian citizenship did not defeat jurisdiction. The court also concluded that the district court properly exercised personal jurisdiction over Hanzada where there was sufficient minimum contacts with Missouri for the Missouri long-arm statute to authorize personal jurisdiction. Finally, the district court properly found the statute of frauds inapplicable in this case where, under Missouri law, an oral contract for an indefinite period of time does not violate the statute of frauds. Accordingly, the court affirmed the judgment. View "Aly v. Hanzada for Import & Export Co." on Justia Law