Justia Contracts Opinion Summaries

This appeal arose from the City's contract with Ambac to provide municipal bond insurance. The City filed suit against Ambac alleging that Ambac breached an agreement to provide a credit enhancement, that there was error in the principal cause, that Ambac acted in bad faith, and that the City had detrimentally relied on Ambac’s representations and assurances regarding the value of its credit enhancement product. The district court granted Ambac's motion to dismiss. The court concluded that the district court did not err in dismissing the City's breach of contract claim because the district court properly interpreted the Policy and because the City’s argument that it created a written and oral contract with Ambac for credit enhancement is not plausible based on the facts alleged. The court also concluded that any error about what the City was purchasing when it paid Ambac in excess of six million dollars was a unilateral error by the City because of the clear language of the Policy, and any unilateral error by the City about what it was purchasing from Ambac was not reasonable or excusable. Because the City’s proffered error is unreasonable, it does not vitiate consent. Because the City has failed to establish the existence of a larger credit enhancement agreement between it and Ambac, the City’s bad faith claim concerning this purported agreement necessarily fails. Finally, the court affirmed the district court's dismissal of the City's detrimental reliance claim where the City and Ambac are sophisticated parties that engaged in arm’s length negotiations with respect to this bond offering. Accordingly, the court affirmed the judgment. View "New Orleans City v. AMBAC Assurance Corp." on Justia Law

Plaintiff filed suit for breach of contract, negligence, wrongful foreclosure, and violations of the Texas Deceptive Trade Practices Act (DTPA), Tex. Bus. & Com. Code 17.50(a)(1)). On appeal, plaintiff challenged the district court's dismissal of her claims, as well as her motion to join a non-diverse defendant. The court concluded that the district court's dismissal of plaintiff's breach-of-contract claim was proper because she failed to allege any facts showing her own performance and did not refute the facts in documents referred to in her complaint, central to her claims, and attached to the motion to dismiss; the dismissal of the negligence claim was proper where any damages stemming from an alleged violation of those solely contractual duties are not redressable in tort; the wrongful-foreclosure claim was properly dismissed where plaintiff never alleged that Wells Fargo disposed of the house at a “grossly inadequate selling price,” nor does she allege that Wells Fargo fraudulently chilled the bidding at the foreclosure sale; and, where plaintiff bases her DTPA claims on Wells Fargo’s failure to make automatic withdrawals to pay the loan, such services cannot form the basis of a DTPA claim because they are incidental to the loan and would serve no purpose apart from facilitating the mortgage loan. Finally, in regard to the motion to join a non-diverse defendant, the district court applied the correct legal standard and its finding of fact were not clearly erroneous. Accordingly, the court affirmed the judgment. View "Villarreal v. Wells Fargo Bank, N.A." on Justia Law

After the American Association of Neurological Surgeons' (AANS) Professional Conduct Committee (PCC) recommended that plaintiff's membership be suspended for six months, he appealed to the AANS Board of Directors. The Board downgraded the suspension to a censure, but plaintiff subsequently resigned from the AANS and filed suit, claiming that the censure harmed his future employment opportunities as an expert witness. Plaintiff filed suit against the AANS for tortious interference with prospective business relations; breach of contract (the AANS bylaws); and impairment of an important economic interest from denial of due process. The court concluded that plaintiff received sufficient due process, including notice, a hearing, and multiple levels of appeal, before he was censured for failing to review all pertinent and available records prior to testifying. Because the district court found only one basis of the censure to be unsupported by due process, the district court was correct in setting aside only that portion of the censure. The court further concluded that no Texas court has recognized a breach of contract challenge to a private association’s disciplinary process. Therefore, plaintiff failed to state a plausible breach of contract claim on which relief could be granted, and the district court properly dismissed. Accordingly, the court affirmed the judgment. View "Barrash v. Amer. Ass'n of Neurological Surgeons" on Justia Law

Plaintiff, a technician employed by Tiger, filed suit against Triton and W&T after he was injured on board a vessel. W&T hired Triton to provide a vessel, staff, and equipment for W&T's offshore pipeline project, and also hired Tiger as a safety contractor. The district court interpreted the parties’ Master Service Contract (MSC) to place the burden of payment for plaintiff's injuries on W&T alone. The court concluded that the district court properly determined that plaintiff was W&T’s invitee; the district court's factual findings compel the conclusion that plaintiff was not Triton’s invitee; and the district court was correct to hold that W&T was liable under the MSC for Triton’s settlement and defense costs related to plaintiff's claims. Accordingly, the court affirmed the judgment. View "Grogan v. Triton Diving Services, L.L.C." on Justia Law

In this complex, multi-forum dispute over compensation between a German company (PACT) and its former CEO, the CEO appealed the district court's dismissal, without prejudice, based on forum nonconveniens (FNC). The court concluded that the forum selection clause in the contract at issue is mandatory and enforceable. Further, no overwhelming public interest requires retention in Texas. Given the Supreme Court’s strong admonitions in favor of dismissal and against retention save for extraordinary matters, the district court was well within the bounds of its considerable discretion in dismissing. Accordingly, the court affirmed the judgment. View "Weber v. Pact XPP Techs." on Justia Law

Seahawk filed suit against insurers for proceeds covering the physical damage to a drilling rig and the loss on a drilling contract. The court concluded that, because there were two occurrences, the district court properly denied Seahawk’s claim for the cost of repairs between February and December 2010. That court’s proximate-cause analysis was the correct legal standard for determining the number of occurrences, and the district court did not clearly err in finding that the February storm was not the proximate cause of the sequence of losses following the July storm. The court also concluded that the district court did not err in rejecting Seahawk’s claim under the Contract Provision. The concurrent-cause doctrine applies, and Seahawk could not recover because it failed to comply with the requirements of that doctrine. Accordingly, the court affirmed the district court's judgment for the insurers. View "Seahawk Liquidating Trust v. Certain Underwriters" on Justia Law

This lawsuit stemmed from an agreement between the ART entities and the Clapper entities to purchase several apartment complexes. The parties organized the transaction so that an intermediate entity, the Partnership, would be the nominal buyer of the properties. The court found that the ART entities waived their challenge to the district court’s general application of the 19% prejudgment interest rate, its use of a compounding interest calculation, and its calculation of prejudgment interest through and including the date of judgment. Accordingly, the court vacated and remanded with instructions for the district court to reenter the portions of its first judgment that were affirmed in Art Midwest II, and to recalculate pre- and postjudgment interest on the section 4.02(d) of the Partnership Agreement award with reference to the date of the first judgment, October 11, 2011. View "Art Midwest, Inc. v. Clapper" on Justia Law

Prosperity entered into contracts with a number of F&M bankers that included covenants not to compete, not to solicit, and not to disclose confidential information obtained while working at Prosperity. Prosperity sought to enforce the restrictive covenants under Texas law, but the district court denied Prosperity's application for injunctive relief. Texas generally allows covenants not to compete so long as they are limited both geographically and temporally, Tex. Bus. & Com. Code Ann. 15.50(a). Oklahoma generally does not, Okla. Stat. tit. 15, 217. The court concluded that, with respect to the noncompetition covenants, the choice-of-law provision is likely unenforceable,and the agreement is unlikely to fall within Oklahoma’s goodwill exception to its ban on noncompetition agreements. Therefore, the court affirmed the denial of Prosperity’s request for an injunction seeking to enforce these clauses because Prosperity cannot meet the important “substantial likelihood of success” factor. The court concluded that, with respect to the nonsolicitation covenant, the choice-of-law provision is likely enforceable. Therefore, the court remanded to the district court to permit it to decide in the first instance whether the agreement is enforceable under Texas law as is, or pursuant to a modification, and whether the other equitable factors warrant a preliminary injunction. Finally, the court affirmed the district court's conclusion that the nondisclosure agreement was likely enforceable and denied the request for a preliminary injunction on the ground that Prosperity failed to establish likelihood of success or irreparable injury. View "Cardoni v. Prosperity Bank" on Justia Law