Justia Contracts Opinion Summaries

Plaintiff and his corporate entity, Marken, Inc., filed suit alleging that FedEx breached contractual duties, engaged in fraud, and violated North Dakota's Franchise Investment Law, N.D.C.C. 51-19-02(5)(a), and Racketeer Influenced and Corrupt Organizations (RICO) Act, N.D.C.C. 12.1-06.1-05. The district court dismissed the amended complaint. Determining that Pennsylvania law governs the construction of the Standard Operating Agreement (SOA) at issue, the court concluded that dismissal as to the first breach-of-contract claim was proper because the SOA had expired and the Independent Service Provider (ISP) Agreement governed the relationship between the parties. Furthermore, the plain text of the SOA foreclosed the claim. The court also concluded that plaintiff's second breach-of-contract claim was properly dismissed and rejected plaintiff's reading of the Background Statement of the SOA because plaintiff's reading ignores context and would lead to an absurd result. The court also concluded that plaintiff's fraud claims were properly dismissed because he failed to plead fraud with the specificity required by Rule 9(b); the district court properly dismissed the Franchise Investment Law claim because the amended complaint failed to plausibly allege that plaintiff was granted the right to offer or distribute services to customers; and plaintiff's state RICO claim was also properly dismissed because he failed to sufficiently plead facts for his fraud claims and Franchise Investment Law claim. Accordingly, the court affirmed the judgment. View "Neubauer v. FedEx" on Justia Law

After a surgical procedure was performed on Elliot Kaplan as a result of a misdiagnosis, the Kaplans filed suit against Mayo for medical malpractice, breach of contract, lack of informed consent, and loss of consortium. The district court dismissed all claims against Dr. Nagorney, the surgeon who performed the medical procedure; the district court granted Mayo's motion for judgment as a matter of law on the breach-of-contract claim; and the jury returned a verdict for defendants on the malpractice claim. On appeal, the court upheld the jury verdict but vacated the judgment in favor of Mayo on the breach-of-contract claim, and held that the district court erred by requiring expert testimony to establish a contract breach and remanded the claim to trial. The district court subsequently entered judgment for Mayo. The court concluded that substantial evidence supports the district court's finding that Dr. Nagorney did not promise to do a biopsy of Elliot’s pancreas during the surgery and that no meeting of the minds occurred to form a contract. The court rejected plaintiffs' claim that this court, in Kaplan I, forbid defendants' use of expert testimony to establish a defense to the claim of a special contract in the performance of the operation. Because the district court committed no error, the court upheld the district court's factual findings. Accordingly, the court affirmed the judgment. View "Kaplan v. Mayo Clinic" on Justia Law

Plaintiffs filed a class action against TMBC, challenging TMBC's nationwide practice of charging a document fee when selling boats and trailers under form contracts governed by Missouri law. The district court approved class certification and then granted summary judgment to the class, awarding treble damages and attorney fees. The district court determined that TMBC prepared legal documents attendant to its sales and that charging a fee for those documents constituted unauthorized law business in violation of Mo. Rev. Stat. 484.010 and 484.020. Both parties appealed. The court concluded that the district court did not abuse its discretion in finding that the class as ultimately defined met the requirements of Rule 23 and certifying the case as a class action; the district court did not err in granting the class members' motion for summary judgment or in calculating damages based upon the entire document fee; and the district court did not err in applying Missouri law to sales that occurred outside Missouri. Accordingly, the court affirmed as to these issues. The court then addressed plaintiffs' contention that the district court erred when it held that the attorneys’ fees should be paid from the common fund rather than paid by TMBC pursuant to the contractual fee-shifting provision, concluding that enforcement of the fee-shifting provision honors both the contract and the principles underlying the common fund doctrine. Therefore, the court reversed and remanded for further proceedings as to the award. The court noted that if the district court, on remand, should determine that counsel for the class is entitled to additional fees from the common fund, apart from those reasonable expenses covered by the fee-shifting provision, it is not prohibited from awarding additional fees. View "McKeage v. TMBC, LLC" on Justia Law

The city entered into an agreement with Acciona, a manufacturer and installer of wind generation systems, where Acciona would expand its business in West Branch if the city would consider rebating a portion of Acciona's taxes each year for eight years. After paying rebates for three years, the city refused to pay subsequent rebates and ultimately cancelled the agreement. The district court concluded that the city breached the contract and awarded Acciona damages. The court concluded that the district court did not abuse its discretion in determining that Acciona's actions were essentially harmless because they resulted in no surprise or prejudice to the City. In this case, Acciona sought compensatory damages for multiple fiscal years from the very beginning of this lawsuit. Acciona's pretrial clarification that the company would seek compensatory damages for fiscal years 2013 and 2014 was therefore entirely consistent with the theory of damages articulated by Acciona. Accordingly, the court affirmed the judgment. View "Acciona Windpower v. City of West Branch" on Justia Law

ACI filed suit seeking a declaratory judgment that it amended and terminated a Licensing Agreement, thus ending ACI’s obligation to make royalty payments to Churchill. Churchill counterclaimed for breach of contract. The district court granted summary judgment for ACI. Although the court agreed with ACI and the district court that Amendment 4 of the Licensing Agreement did not have the effect of retroactively making Churchill a full party to the License Agreement, the court did not agree that either Amendment 4 or the receivership sale prevents Churchill from exercising the legal rights of a third-party beneficiary or assignee. The court also did not agree with ACI that the doctrine of merger prevents additional royalties from becoming due to Churchill. Therefore, the court concluded that ACI did not validly amend the Licensing Agreement to eliminate the post-termination royalties provision, and royalties are still due to Churchill for any sublicenses granted by ACI prior to July 21, 2014. Accordingly, the court reversed the entry of summary judgment for ACI on the issue of amendment of the Licensing Agreement, affirmed the entry of summary judgment in favor of ACI on the issue of termination, and remanded to the district court for further proceedings. View "ACI Worldwide Corp. v. Churchill Lane Associates, LLC" on Justia Law

Schnucks, a grocery store chain, filed suit against First Data, a credit card processor, and Citicorp, the acquiring bank for its credit transactions. Schnucks brought declaratory judgment and breach of contract claims, alleging that defendants withheld more money from Schnucks following a data breach at Schnucks than their contract allowed. Defendants counterclaimed. The district court denied defendants' motion for judgment on the pleadings and granted Schnucks's motion for judgment on the pleadings. Determining that it has jurisdiction, the court applied Missouri law and concluded that the assessments are not carved out from Schnucks’s limitation of liability as “third party fees.” Furthermore, the court concluded that the district court did not err in holding that the assessments for issuing banks’ losses do not constitute “fines or penalties.” The underlying business arrangement, which represents defendants’ choice to vouch for Schnucks’s compliance with data-security standards, is not rendered commercially unreasonable merely because the limitation on Schnucks’s liability is broader than defendants now wish it to be. The court held that the district court did not misapply the standard for judgment on the pleadings in concluding that defendants had not raised the issue of the separate $3,000,000 limitation of liability. Finally, the district court did not abuse its discretion in denying defendants’ motion for reconsideration or leave to amend, which essentially restated their assertions of error regarding judgment on the pleadings, and defendants failed to show good cause. Accordingly, the court affirmed the judgment. View "Schnuck Markets, Inc. v. First Data Merchant Services Corp." on Justia Law

ACI was the company that manufactured and supplied roofing materials used in the construction of the high school building at issue here. The District filed suit against ACI, alleging that the building’s roof was not watertight and that ACI had failed to repair or replace the roof. The district court granted ACI's motion to dismiss. The court concluded that the district court properly dismissed the false representation claims where the District did not plead any false representation. The court rejected the District's claim that it's allegations related to ACI's assurances that it would repair or replace the roof, because such assurances relate to a future event. Under Arkansas law, generally, a misrepresentation must relate to a past event or a present circumstance. The court also concluded that the district court properly dismissed the fraud and constructive fraud claims for failure to plead actual reliance by the District on ACI's alleged misrepresentations. The district court did not err in granting summary judgment for ACI on the remaining breach of warranty, breach of contract, and negligence claims because Arkansas's statute of repose bars the District's claims. Finally, the court rejected the District's argument that the statute of repose was tolled while ACI tried to repair the roof where there is no evidence that ACI fraudulently concealed the roof’s deficiencies. Accordingly, the court affirmed the judgment. View "Star City School District v. ACI Building Systems, LLC" on Justia Law

At issue in this case is a lease for a Gap store in Grand Forks, North Dakota. Gap argues that the lease does not require it to pay for heating, ventilation, and air conditioning (HVAC) expenses and a share of mall operation costs. GK, the mall's management company and owner, disagreed. The district court issued a declaratory judgment in favor of Gap. The court concluded that GK waived the argument that Gap owes it for HVAC expenses under Article 10(B) of the lease. The court also concluded that, reading the ambiguous lease language in conjunction with the extrinsic evidence, a rational factfinder can reach only one conclusion in this case: The parties intended that Gap not be obligated to pay for Center Expenses for the duration of the lease. Because GK points to no evidence that its past HVAC charges were established under Article 11(C), this modification does not affect the district court’s determination that GK breached the lease or its damages award. Accordingly, the court affirmed, modified in part, and remanded the district court's judgment. View "The Gap, Inc. v. GK Development, Inc." on Justia Law

Plaintiffs filed suit on behalf of themselves and a putative class of DISH subscribers, seeking monetary relief for Turner and FOX News services interruptions. The court concluded that, under Colorado law, the subscription agreement between DISH and its customers, which is comprised of both a Digital Home Advantage Plan Agreement and a Residential Customer Agreement (RCA), is not illusory. In this case, the district court’s interpretation of Section 1.I. and Section 7.A. of the RCA improperly converted the covenant of good faith and fair dealing into an additional contract term. It allowed plaintiffs to recover monetary relief for services interruptions, a remedy that is unambiguously precluded by the express terms of the parties’ contractual bargain. Therefore, the duty of good faith and fair dealing may not be applied to require DISH to provide any monetary relief when it deletes or changes programming for which subscribers have already paid. Because plaintiffs' claims for class-wide monetary relief failed to state a claim upon which relief can be granted, the court reversed and remanded for further proceedings. View "Stokes v. DISH Network" on Justia Law

The district court found third-party plaintiff Qwest failed to prove its claims for intentional interference with a business relationship, unfair competition, and unjust enrichment against third-party defendant FC. The court agreed with the district court that FC did not act with an improper purpose when it contracted with Sancom, a local exchange carrier (LEC), because FC was simply attempting to take advantage of the uncertain regulatory scheme at the time; FC had a legitimate argument that it could be considered an “end user,” and thus Sancom could bill Qwest under its tariff for calls delivered to FC’s call bridges; and thus the district court did not err in finding for FC on Qwest's claim for intentional interference with a business relationship. The court predicted that the South Dakota Supreme Court would not recognize a tort of unfair competition under these circumstances, and found that the district court properly rejected this new tort. The court concluded, however, that the district court incorrectly found FC’s conduct was “neither illegal nor inequitable” because it was simply taking advantage of a loophole until the loophole closed, and the district court improperly considered Sancom’s settlement payments to Qwest when it found FC was not unjustly enriched. Therefore, the court reversed and remanded for reconsideration of whether FC was unjustly enriched. View "Qwest v. Free Conferencing Corp." on Justia Law