Justia Contracts Opinion Summaries

The adversary action comprises the claims, counterclaims, and affirmative defenses between two sides of a business scheme to buy, renovate, and operate a Days Inn. This appeal stems from the district court’s order affirming a bankruptcy court judgment rendered after trial in the adversary action. Appellant and his brother formed the plan to buy the hotel, and appellees are the investors that the brothers convinced to buy a fifty-percent stake in the scheme and the company that the three investors formed to hold their membership interest. The court concluded that appellant's res judicata argument fails where the release claim at issue was filed in the original action while summary judgment was still interlocutory. Thus, the claim was properly preserved through the severance order for later adjudication, and res judicata does not bar it. The court also concluded that the district court did not err in affirming the bankruptcy court judgment that appellant breached the settlement agreement. Further, the district court properly affirmed the bankruptcy court's dismissal of appellant's breach-of-guaranty claim against the investors, but not as to the company. The court affirmed in part and vacated in part, remanding for additional proceedings, including a determination of what percentage of the attorney’s fees were attributable to the breach-of-contract claim. View "Pirani v. Baharia" on Justia Law

DTC filed suit against JPMC and others, alleging willful patent infringement relating to electronic check-processing systems. JPMC was the first bank to reach a settlement agreement with DTC in 2005. As part of the settlement, JPMC entered into a consent judgment in which it admitted the patents were valid and enforceable and that JPMC had infringed them. It also entered into a license agreement permitting JPMC unlimited use of DTC’s patented technology going forward. At issue in this appeal is the district court’s interpretation of a most favored licensee (MFL) clause in the license agreement allowing JPMC to use DTC's patented check processing technology. JPMC invoked its rights under the MFL clause based on DTC’s granting a similar unlimited license to another entity for a lesser lump sum than JPMC paid. The court agreed with the district court that after comparing these two lump-sum license agreements, the later agreement is indeed more favorable, and JPMC therefore is entitled to a refund from DTC for the difference between the amount it paid for its license and the lesser amount bargained for in the later license agreement. Accordingly, the court affirmed the judgment. View "JP Morgan Chase Bank, N.A. v. Datatreasury Corp." on Justia Law

Plaintiff a former SMU student, filed suit against the university, alleging nineteen causes of action stemming from his dismissal as a community advisor (CA). The only claim at issue on appeal, whether SMU breached a duty of good faith and fair dealing, was dismissed by the district court for failure to state a claim. The court agreed with the district court that plaintiff had not alleged facts that, taken as true, would give rise to the type of special relationship that creates a duty of good faith and fair dealing under Texas law; even assuming arguendo that the student-university relationship could possibly give rise to a duty of good faith and fair dealing, plaintiff’s allegations are not sufficient to show that such a relationship existed; none of plaintiff's theories demonstrate that his purported special relationship with SMU administrators existed before and independently of the immediate circumstances of the course of events that led to his dismissal as a CA; and plaintiff’s claims demonstrate at most the sort of unilateral, purely subjective sense of trust that Texas courts have determined is insufficient to convert an ordinary arm’s-length relationship into a special or confidential relationship. Accordingly, the court affirmed the judgment. View "Hux v. Southern Methodist Univ." on Justia Law

Plaintiffs filed suit against 24 Hour Fitness, alleging that their membership contracts did not strictly comply with several technical provisions of the Texas Health Spa Act, Tex. Occ. Code Ann. 702.304, 702.305, 702.401, 702.402(a)(2). The district court dismissed the suit based on lack of standing. Because plaintiffs are not entitled to a full refund of their membership dues, and because 24 Hour’s alleged violations of the Act did not cause plaintiffs actual damages or any other form of economic harm, plaintiffs have sustained no economic injury. Furthermore, plaintiffs have not suffered a non-economic injury where plaintiffs have suffered no cognizable statutory injury under the Act. The Act does not authorize members to sue health clubs for technical statutory violations which cause the member no harm. Moreover, the Act does not authorize health club members to recover statutory or nominal damages for mere technical violations. Accordingly, the court affirmed the judgment because plaintiffs lack Article III standing. View "Wendt v. 24 Hour Fitness USA, Inc." on Justia Law

This appeal involves a breach of contract dispute between the parties regarding the proper configuration and installation of rooftop air handling units for passenger boarding bridges. The court concluded it was error to grant summary judgment for INET on the basis that DFW first breached the contract. The record contains disputes of material fact regarding which party prevented performance by failing to fully cooperate in arriving at a solution once the parties discovered defects. Accordingly, the court reversed the grants of summary judgment for INET and Hartford and remanded this case for the claims to proceed to a fact finder. Because the district court granted INET damages and fees based on its summary judgment rulings, the court also vacated those awards. View "Dallas/Fort Worth Int'l Airport Bd. v. Inet Airport Sys." on Justia Law

Yumilicious, a Texas frozen yogurt company, filed suit against franchisees based in South Carolina after disputes over the franchise agreement arose. Defendants filed a countercomplaint with various counterclaims. The district court granted summary judgment for Yumilicious and dismissed the remainder of the franchisees' counterclaims with prejudice for failure to state a claim under Rule 12(b)(6). The court affirmed the district court's grant of partial summary judgment and affirmed the dismissal of the franchisees' remaining counterclaims because the franchisees failed to plead the required elements of their statutory claims, failed to introduce facts suggesting non-economic injuries, failed to introduce evidence of fraudulent inducement, and contractually waived their right to punitive and consequential damages. View "Yumilicious Franchise, L.L.C. v. Barrie" on Justia Law

This appeal stems from a dispute over whether plaintiff breached the contract between the parties by failing to deliver a helicopter that met the specifications of the purchase agreement. The district court sua sponte granted summary judgment for plaintiff and dismissed North Bay's counterclaim for breach of contract. The district court then denied North Bay's motion to alter or amend its pleading under Fed. R. Civ. Pro. 59(e). North Bay alleged that plaintiff breached the contract because the airworthiness certificate specified a different type of helicopter and because the helicopter was not airworthy given that it was not in compliance with Directive 80-04-04. Because North Bay presented probative evidence in its 59(e) motion, and the district court failed to give North Bay an opportunity to respond before it sua sponte granted summary judgment for plaintiff, the court concluded that the district court abused its discretion when it denied North Bay’s motion to reconsider. Accordingly, the court reversed the denial of the motion, vacated the grant of summary judgment, and remanded. View "Luig v. North Bay Enter., Inc." on Justia Law

Malin filed suit against OSA for the balance of its unpaid invoices for work, services, materials, and supplies that it had provided to OSA at the request of Con-Dive. The court affirmed the district court's denial of OSA's motion to vacate the attachment, concluding that, under Texas law, title to the bunkers at issue passed to OSA on delivery. OSA held title to the bunkers at the time of Malin's attachment, and title to property unquestionably suffices as an attachable interest under Supplemental Admiralty Rule B. Therefore, the district court had personal jurisdiction over OSA by virtue of the attachment of the bunkers on the vessel that it had chartered. The court affirmed the district court’s determination that no material issues of fact exist as to whether OSA received and ratified the invoices, including their interest and attorneys fees provisions. Thus, the court concluded that the district court committed no error in granting summary judgment for Malin. The court affirmed the judgment. View "Malin Int'l Ship Repair v. Oceanografia, S.A. de C.V." on Justia Law

After Pauline Tillman Wagner and Ida Roberson died in Mississippi nursing homes run by Golden Living Southaven and Golding Living Center Batesville, Wagner's son (Sammy Gross) and Roberson's daughter (Shirley Cotton) filed suit against the nursing homes. After removal to federal court, the district court subsequently denied Southaven and Batesville's motion to compel arbitration based on arbitration agreements that the adult children had signed for their mothers when admitting them to the homes. The court held that the Mississippi Supreme Court would not adopt the district court’s formal device requirement and would instead permit parties to establish the existence of an agency relationship with other types of evidence. The court concluded that Gross's sworn testimony is competent evidence on the question of Gross’s agency and its scope. Because the existence and scope of an actual agency relationship is a question of fact the district court did not reach, the court could not decide the actual agency issue as a matter of law. Therefore, the court remanded for the district court for a factual finding on this issue in the first instance. Likewise, the same situation applies to Cotton, and the court remanded for the district court for a factual finding on this issue in the first instance. The court rejected defendant's estoppel argument. Finally, the court concluded that Batesville's apparent authority argument fails because it failed to put forth evidence of detrimental reliance; the district court properly rejected Batesville's ratification theory based on insufficient evidence; and the court declined to address the forum issue. Accordingly, the court vacated and remanded. View "Gross v. GGNSC Southaven, LLC" on Justia Law

Plaintiffs Shakeri and Taji filed suit against ADT, alleging a breach of contract claim and tort claims under Texas law for negligence, fraud, unconscionable conduct, and breach of the implied warranty of good and workmanlike performance. Plaintiffs were robbed at gunpoint and injured at their jewelry store. During the robbery, Shakeri pushed the button to trigger the alarm system multiple times, but the alarm system and the backup alarm failed to work. The district court ultimately dismissed plaintiffs’ tort claims and limited their contractual recovery in three separate orders. Determining that plaintiffs are bound by the terms of a 1999 Contract, the court concluded that the district court erred in dismissing plaintiffs' negligence claim where Shakeri's injury is the kind of physical harm that is not covered by the economic loss rule and is not defeated by the existence of a contract between the parties; plaintiffs failedto state adequate claims for breach of the implied warranty of good and workmanlike performance under Texas law; the district court did not err in dismissing plaintiffs’ unconscionable conduct claim; and plaintiffs' fraudulent inducement claim is barred under Texas law. Therefore, the court reversed the district court's dismissal of plaintiffs' negligence claim and remanded for further proceedings on this claim. The court affirmed the district court's dismissal of plaintiffs' remaining tort claims. View "Shakeri v. ADT Security Servs." on Justia Law