Justia Contracts Opinion Summaries

After a jury found that Westcoast was liable for breaching a contract it entered with RCS, Westcoast raised claims of error regarding the finding of a bad-faith breach, the language of the verdict form, and the award of attorney fees. In this case, the jury had awarded RCS $304,189 on the bad faith breach of contract claim, $66,450 under the state Prompt Payment Act, $130,517.60 in attorney fees, and $400 in costs.The Fifth Circuit vacated and remanded the penalty amount determined under the Louisiana Prompt Payment Act, holding that the jury awarded damages exceeding those permitted under the clear language of the Act. The court also vacated and remanded the award of attorney fees for reconsideration of the amount after the statutory penalty was reconsidered. View "Alonso v. Westcoast Corp." on Justia Law

This case stemmed from a contract dispute between two oil-drilling businesses, Eni and Transocean. The district court granted judgment in favor of Transocean and rejected Eni's claims surrounding Transocean's maintenance of its equipment, found that Eni had wrongfully repudiated the contract, and awarded damages to Transocean.The Fifth Circuit vacated the damages award and held that the district court erred by simply applying the Standby Rate because Eni never issued any instructions after repudiation. In this case, the district court should have attempted to determine, in the hypothetical nonbreach world, how many days the Deepwater Pathfinder would have spent at each applicable rate. Accordingly, the court remanded with instructions to recalculate the damages using the correct methodology. The court found Eni's remaining arguments lacking in merit and affirmed as to those claims. View "ENI US Operating Company, Inc. v. Transocean Offshore Deepwater Drilling, Inc." on Justia Law

Encompass filed suit against Blue Cross for violations of the Employee Retirement Income Security Act (ERISA), breach of contract, defamation, and tortious interference with business relations. After Blue Cross largely prevailed at trial, the district court granted a new trial because of error in the jury charge. At the second trial, Encompass prevailed on all claims.The Fifth Circuit held that charging the jury with an incorrect standard of liability supported granting a new trial, and thus the district court did not abuse its discretion by granting Encompass a new trial on the breach of contract claims. The court also held that the district court did not abuse its discretion by granting a new trial on the tort claims considering the interdependence of the tort and contract issues. Finally, the court held that the application of contra non valentem was not wrong as a matter of law, and Blue Cross abused its discretion by arbitrarily denying Encompass's claims for covered services under ERISA. View "Encompass Off Solutions, Inc. v. Louisiana Health Service & Indemnity Co." on Justia Law

Mid-Continent filed a declaratory judgment action seeking a declaration that it did not owe coverage for a judgment assessed against its insured, PSI. The district court ruled that the Cooperation Clause in the policy applied to PSI's third-party claim in the underlying lawsuit and that only parts of the judgment were covered.The Fifth Circuit affirmed in part and held that, regardless of whether the Cooperation Clause applied to affirmative claims, the Cooperation-Clause jury instruction was not an abuse of discretion. The court reversed the district court's conclusion that the Professional Liability Endorsement did not cover the entire judgment and held that it did. View "Mid-Continent Casualty Co. v. Petroleum Solutions, Inc." on Justia Law

Debtor brought an adversary proceeding against Kestrel for breach of contract, alleging that Kestrel failed to pay for services owed that debtor provided Kestrel to help it collateralize a corporate debt offering with life settlements. The Fifth Circuit affirmed the district court's judgment upholding the bankruptcy court's holding that the contract was voidable because debtor failed to register as an investment adviser in violation of the Investment Advisers Act of 1940. The court held that debtor contracted with Kestrel to advise it about life settlements, and the life settlements contemplated in the origination agreement were investment contracts within the meaning of the Act. View "Living Benefits Asset Management v. Kestrel Aircraft Co." on Justia Law

In this action involving a Texas mortgage dispute, the Fifth Circuit held that there was ambiguity in the contract's escrow provisions and thus the district court erred by granting summary judgment to defendants on claims arising from that ambiguity. The court noted that, at this stage, it was premature to conclude that defendants were entitled to their foreclosure counterclaim. Therefore, the court vacated the foreclosure ruling and remanded for reconsideration. The court affirmed the district court's grant of summary judgment for defendants on the Real Estate Settlement Procedures Act claim, and the district court's judgment on the Texas Debt Collection Practices Act claim. View "Wease v. Ocwen Loan Servicing, LLC" on Justia Law

Volvo filed suit against defendant for breach of contract after he defaulted on payments under eight separate promissory notes. The Fifth Circuit affirmed the district court's grant of summary judgment for Volvo, holding that Mississippi Code 15-1-23 did not bar Volvo from bringing deficiency claims on Notes 001–004. The court held that the most reasonable interpretation of section 15-1-23, when applied to the facts of this case, was that the sale of all property securing a note must be complete to trigger the statute of limitations. The court also affirmed the district court's denial of defendant's Rule 59(e) motion to alter or amend the judgment, holding that Mississippi Code 75-9-615(d)(1) and (d)(2), section 75-9-616(a) and (c), and section 75-9-617(a) were not determinative in this case. View "Volvo Financial Services v. Williamson" on Justia Law

IberiaBank filed suit against defendant in state court under the Computer Fraud and Abuse Act (CFAA), seeking a declaratory judgment that IberiaBank was not required to pay defendant, a former employee, his success bonus. After the parties agreed to close arbitration and pursue claims in federal court, the district court granted summary judgment on some claims and, at a bench trial, a magistrate judge resolved the remaining claims. Both parties appealed.The Fifth Circuit held that the trial court did not clearly err by concluding that defendant breached the Change-in-Control Severance Agreement; that IberiaBank did not breach its employment agreement with defendant; and that defendant violated the CFAA because there was sufficient evidence to support the trial court's finding that defendant lacked authorization to delete IberiaBank files. The court declined to resolve whether there was a Louisiana Unfair Trade Practices Act violation in this case and remanded for the trial court to consider the claim. The court held that the district court correctly held that IberiaBank's litigation behavior did not demonstrate actual malice. Finally, the court affirmed the rulings on attorneys' fees. View "IberiaBank v. Broussard" on Justia Law

Conn Credit filed suit against TF Loan for breach of contract and TF Loan counterclaimed for breach. The Fifth Circuit reversed the district court's judgment in favor of Conn, holding that Conn's representations and warranties in Section 8.5 of the Sale Agreement were false because Conn's failure to refund canceled retail service agreement (RSA) accounts violated Section 1304.159(c) of the Texas Occupations Code. Therefore, Conn did not satisfy the condition precedent in Section 10.2, and its claim for breach of contract failed. The court also held that the district court erred as a matter of Texas law by imposing a prejudice requirement on TF Loan; Conn failed to show that anything in the Sale Agreement imposed a materiality requirement on the Section 10.2 condition; Conn failed to show that TF Loan waived the condition precedent in Section 10.2; and Conn's remaining claims failed. Finally, the court held that TF Loan was entitled to repurchase of accounts in the Bulk Sale and Deliveries One and Two with canceled RSAs. View "Conn Credit I, LP v. TF Loanco III, LLC" on Justia Law

IAS filed suit against defendant and his company, alleging claims of fraud, fraudulent inducement, fraud by nondisclosure, and breach of contract. Defendant filed a counter suit for breach of his employment contract with IAS. The Fifth Circuit reversed the dismissal of IAS's fraudulent inducement claim where the district court's assessment that there was no fraud did not appear to have been based on any assessment of the evidence presented at trial. The court affirmed the judgment in favor of defendants on IAS's breach of contract claim where the district court's finding that IAS did not suffer any damages as a result of any breach of the asset purchase agreement was plausible in light of the record as a whole. Finally, the court vacated the severance pay award in favor of defendant because, even assuming that defendant was terminated for reasons other than cause, he failed to satisfy the second condition precedent to his receipt of severance pay: execution of the required release and waiver. The panel remanded for further proceedings. View "IAS Service Group, LLC v. Jim Buckley & Assoc." on Justia Law