Justia Contracts Opinion Summaries

The European Telecommunications Standards Institute (ETSI) established many global standards for 3G, 4G, and 5G cellular communications technology. ETSI members that own standard-essential patents must provide “an irrevocable undertaking in writing that [they are] prepared to grant irrevocable licenses on fair, reasonable and non-discriminatory (FRAND)” terms. Ericsson holds patents that are considered essential to the ETSI standards and agreed to grant licenses to other companies to use its standard-essential patents on FRAND terms. HTC produces mobile devices that implement those standards; to manufacture standard-compliant mobile devices, HTC has to obtain a license to use Ericsson’s patents. Ericsson and HTC have previously entered into three cross-license agreements for their respective patents. Negotiations to renew one of those agreements failed.HTC filed suit, alleging that Ericsson had breached its commitment to provide a license on FRAND terms and had failed to negotiate in good faith. The jury found in favor of the defendants. The district court entered a separate declaratory judgment that the defendants had affirmatively complied with their contractual obligations. The Fifth Circuit affirmed, rejecting challenges to the district court’s exclusion of HTC’s requested jury instructions, its declaratory judgment that Ericsson had complied with its obligation to provide HTC a license on FRAND terms, and the exclusion of certain expert testimonial evidence as hearsay. View "HTC Corp. v. Telefonaktiebolaget LM Ericsson" on Justia Law

Kelley wanted to publish “Hooker to Looker,” to promote her cosmetics business. Di Angelo agreed to publish and distribute Kelley’s then-unwritten Book, with Kelly receiving 50 percent of the net royalties. Kelley provided Di Angelo with a three-page manuscript, detailing her background and outlining the Book’s topics. Di Angelo claims it wrote the Book while “communicating and/or collaborating with Kelley.” The Book Di Angelo distributed lists only Kelley as the copyright holder. Di Angelo sold the initial 1,000-copy print run. Kelley asked Di Angelo for an updated version. Di Angelo alleges that it prepared the updated work, then discovered that Kelley was attempting to work directly with Di Angelo’s printer, in violation of the contract.Kelley sued, claiming that Di Angelo overcharged her and alleging that she “is the sole owner of all copyrights.” Di Angelo counterclaimed for breach of contract. That state court action is pending. Di Angelo filed a federal suit, seeking a declaration that it owns the copyrights. Kelley challenged federal jurisdiction, arguing the claim was premised solely on her alleged breach of the contract, a controversy governed by Texas law. Di Angelo claimed resolution of the authorship dispute required interpretation of federal copyright law, including the definitional and ownership provisions in 17 U.S.C. 101 & 201, which the state court lacks jurisdiction to address. The Fifth Circuit reversed the dismissal of the suit. Di Angelo’s claim necessarily implicates federal law definitions of “Initial ownership” and “Works made for hire.” View "Di Angelo Publications, Inc. v. Kelley" on Justia Law

Petrobras, the American subsidiary of a Brazilian oil and gas producer, alleges that Samsung, a Korean shipbuilder, secretly bribed Petrobras executives to finalize a contract between Petrobras and Pride. In a 2007 contract, Samsung had an option to build a deep-sea drillship if Pride secured a drilling-services contract with another company. Samsung arranged to bribe Petrobras executives to secure Pride's contract for the construction of DS-5. After Petrobras put DS-5 on permanent standby and conducted an internal audit, it informed Brazilian prosecutors. A 2014 investigation into corruption throughout Brazil, included a separate bribery scheme in which Samsung contracted with Petrobras to construct two other ships.In 2019, Petrobras sued Samsung for its role in the bribery that led to the Petrobras–Pride DS-5 contract, citing common-law fraud under Texas law and the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. 1962(c),(d). The district court took judicial notice of Petrobras’s 2014 SEC filing and Washington Post and Reuters articles, describing the bribery schemes underlying other Samsung–Petrobras contracts that did not mention the Petrobras–Pride DS-5 contract. From those, the court inferred that Petrobras was on notice by 2014 that the DS-5 contract was suspect. Holding that “the specific drillship in this case is not subject to its own limitations clock,” the district court dismissed the suit. The Fifth Circuit reversed. The pleadings do not establish as a matter of law that Petrobras had actual or constructive notice of its injury before March 2015, so dismissal at the pleading stage was improper. View "Petrobras America, Inc. v. Samsung Heavy Industries Co., Ltd." on Justia Law

The Fifth Circuit granted the motion to file out-of-time motions for panel rehearing and to recall the mandate; denied the motions; and withdrew its prior opinion, substituting the following opinion.After a federal jury found that 3 Star Properties fraudulently sold SED Holdings millions in loans and awarded SED over $14 million in damages, the Fifth Circuit affirmed the liability judgment against 3 Star but concluded that the damages award was excessive, remanding for remittitur of the award.he court concluded that res judicata does not bar SED's claims and the district court did not err by denying the Hyland Defendants' motion for JMOL on that basis. On the merits, the court concluded that the district court correctly denied the Hyland Defendants’ renewed JMOL as to the fraudulent transfer claim; the district court properly denied their new trial motion as to the conspiracy claim; and the district court did not commit reversible error in instructing the jury on the fraudulent transfer claim and did not abuse its discretion by declining to ask the jury whether subsequent transfers out of the escrow account were fraudulent, when those transfers were not at issue.The court remanded for remittitur and instructed the district court to subtract at least the following three identifiable amounts from the jury award: (1) the double-counted $2 million; (2) the $4 million in lost profits; and (3) the $551,578.17 already recovered from the Biltmore II settlement (in total, $6,551,578.17). The court concluded that no evidence supports the jury conclusion that Home Servicing breached the Servicing Agreement with SED Holdings and thus a new trial is warranted. Therefore, the court vacated the judgment as to SED’s breach of contract claim against Home Servicing and remanded for a new trial. In regard to SED's cross appeal against Nations Law firm, the court concluded that the SED has not shown a fact dispute as to Nations' "full knowledge of all material facts" and the district court did not err by granting summary judgment to Nations.The Hyland Defendants urged the court to reverse the judgment against 3 Star and Johnson, who are not parties to this appeal, but the court declined to do so. View "SED Holdings, LLC v. TM Prop Solutions, LLC" on Justia Law

Colulmbia City seeks to compel IMA to arbitrate a dispute involving unreimbursed medical fees. The parties are connected by a series of intermediary agreements within a preferred provider organization (PPO) network that allows patients in covered health plans to receive medical services from participating hospitals at discounted rates, and one of these agreements contains an arbitration clause. It is undisputed that IMA is not a party or signatory to the Hospital Agreement that contains the arbitration clause.The Fifth Circuit affirmed the district court's denial of Columbia Hospital's motion to compel arbitration. Applying Texas law, the court concluded that the district court correctly applied this circuit's precedent that knowledge of the agreement requires knowledge of the contract's basic terms. In this case, the district court did not clearly err in concluding, based on the record before it, that IMA lacked the requisite knowledge of the Hospital Agreement and its basic terms to be compelled to arbitrate under direct benefits estoppel. Alternatively, the court declined, contrary to Columbia Health's assertions, to construe the series of contracts between IMA, PPOplus, HealthSmart and Columbia Hospital as a unified contract. View "IMA, Inc. v. Columbia Hospital Medical City" on Justia Law

After a federal jury found that 3 Star Properties fraudulently sold SED Holdings millions in loans and awarded SED over $14 million in damages, the Fifth Circuit affirmed the liability judgment against 3 Star but concluded that the damages award was excessive, remanding for remittitur of the award.The court concluded that res judicata does not bar SED's claims and the district court did not err by denying the Hyland Defendants' motion for JMOL on that basis. On the merits, the court concluded that the district court correctly denied the Hyland Defendants’ renewed JMOL as to the fraudulent transfer claim; the district court properly denied their new trial motion as to the conspiracy claim; and the district court did not commit reversible error in instructing the jury on the fraudulent transfer claim and did not abuse its discretion by declining to ask the jury whether subsequent transfers out of the escrow account were fraudulent, when those transfers were not at issue.The court remanded for remittitur and instructed the district court to subtract at least the following three identifiable amounts from the jury award: (1) the double-counted $2 million; (2) the $4 million in lost profits; and (3) the $551,578.17 already recovered from the Biltmore II settlement (in total, $6,551,578.17). The court concluded that no evidence supports the jury conclusion that Home Servicing breached the Servicing Agreement with SED Holdings and thus a new trial is warranted. Therefore, the court vacated the judgment as to SED’s breach of contract claim against Home Servicing and remanded for a new trial. In regard to SED's cross appeal against Nations Law firm, the court concluded that the SED has not shown a fact dispute as to Nations' "full knowledge of all material facts" and the district court did not err by granting summary judgment to Nations. View "SED Holdings, LLC v. TM Prop Solutions, LLC" on Justia Law

In this long-running contract dispute, at issue is whether the parties are entitled to fee awards. The Fifth Circuit concluded that IWS is entitled to some fees under the Texas Theft Liability Act (TTLA) and remanded for a determination of the proper amount. The court clarified that the mandate of Transverse II did not depart from Texas law governing fee segregation, and fees incurred defending the TTLA claim do not become unrecoverable simply because they may have furthered another nonrecoverable claim as well.The court also concluded that, because the Supply Contract itself does not authorize attorneys' fees, under Iowa law, the district court lacked a basis on which to award Transverse attorney's fees for IWS's breach of this agreement. In this case, IWS has made the showing necessary to prevail under plain-error review, and thus the court reversed the fee award to Transverse on the Supply-Contract claim. Finally, the court rejected Transverse's contention that the district court erred by failing to recognize it as the prevailing party on the Non-Disclosure Agreement claim and refusing to award Transverse the related fees. The court explained that Transverse did not prevail, substantially or otherwise, on this claim and thus there was no error on the district court's part. View "Transverse, LLC v. Iowa Wireless Services, LLC" on Justia Law

Plaintiff treated children in the pediatric intensive care unit of a hospital owned by VHS under his professional services agreement with PICCS, which itself operated under a separate coverage agreement with VHS. After PICCS terminated plaintiff, he filed suit alleging claims of race discrimination under Title VII of the Civil Rights Act of 1964 and 42 U.S.C. 1981. The district court granted summary judgment dismissing plaintiff's claims against VHS.The Fifth Circuit affirmed the district court's partial final judgment, concluding that plaintiff's Title VII claim fails for lack of an employment relationship with VHS under either integrated-enterprise or joint-employment theories. The court also concluded that plaintiff's section 1981 claim fails because he cannot identify an impaired contractual right enforceable against VHS. In this case, plaintiff failed to show any contractual right enforceable against VHS under his physician agreement. View "Perry v. VHS San Antonio Partners, LLC" on Justia Law

Hall filed various contract, statutory, and common-law claims against Old Republic in federal district court for failing to indemnify Hall under its title insurance policies. The district court concluded that, although the unpaid Penta pre-policy-date work is a defect under Covered Risk 2 and an encumbrance under Covered Risk 10, coverage is precluded by Exclusions 3(a) and 3(d), which bar claims for liens and work performed after the policy date. The district court found that Hall had not raised a genuine dispute of material fact that Penta's liens were for unpaid work before the policy date, and granted Old Republic's motion for summary judgment and denied Hall's motion for partial summary judgment.The Fifth Circuit concluded that the insuring clauses do not cover Hall's Penta lien losses. The court explained that any doubt about whether Covered Risks 2 and 10 could possibly be read to cover the Penta lien losses at issue here is removed by the fact that the parties also signed standard ALTA Form 32-06. In so doing, the parties specifically contracted to eliminate one coverage provision of the standard-form insurance policy—Covered Risk 11(a). Even assuming arguendo that the 32-06 endorsements and the Covered Risks conflict or result in an ambiguity about whether the Penta lien losses are covered, the court explained that it is the more general provisions that suggest that there may be coverage (under Hall's theory), while the more specific provisions instruct that there is no such coverage. Under basic principles of contract interpretation, the specific controls the general. Therefore, the court need not review the district court's conclusions regarding Exclusions 3(a) and 3(d) to affirm the judgment.The court also affirmed the district court's grant of Old Republic's motion for summary judgment on Hall's bad-faith and Texas Insurance Code claims. The court explained that, because Hall is not entitled to indemnification for the Penta lien losses, Hall cannot show that Old Republic acted in bad faith in denying its claim. Furthermore, because Hall alleges no other harm apart from the Penta lien losses, Hall cannot demonstrate that Old Republic caused it any harm in violating the Texas Insurance Code—assuming arguendo that the Texas Insurance Code applies, and that Old Republic ran afoul of its provisions. Finally, the court affirmed the district court's grant of Old Republic's motion for summary judgment on Hall's independent-counsel (or duty-to-defend) claim. View "Hall CA-NV, LLC v. Old Republic National Title Insurance Co." on Justia Law

The Fifth Circuit affirmed the district court's judgment in favor of Exeter and Exeter's parent company, Enzo, in an action brought by plaintiff, a former employee, for breach of contract, fraud, and quantum meruit. The court concluded that the district court did not abuse its discretion in denying a continuance and plaintiff abandoned his remaining arguments challenging the exclusion of his evidence.The court also concluded that the district court correctly concluded that plaintiff's contract claim, based on the Profits Interest Units Agreement, failed as a matter of law; the district court correctly concluded that, absent evidence of a valid severance agreement, plaintiff's breach of contract claim fails as a matter of law; the district court properly adjudicated plaintiff's fraud claims as a matter of law; and the district court correctly determined that plaintiff's conduct in connection with the transactions before the district court was inequitable, precluding any equitable remedy.The court noted that three-quarters of the record in this case was sealed from the public and that the public's right of access to judicial proceedings is fundamental. The court urged litigants and the court's judicial colleagues to zealously guard the public's right of access to judicial records. View "Binh Hoa Le v. Exeter Finance Corp." on Justia Law