Justia Contracts Opinion Summaries

Articles Posted in US Court of Appeals for the First Circuit
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The First Circuit affirmed the district court's dismissal of Appellant's claims in three putative class action lawsuits against Defendants - Nestle USA, Inc., Mars, Inc., and The Hersey Company - holding that Appellant did not plausibly state a claim for relief under Mass. Gen. Laws ch. 93A and that Appellant's unjust enrichment claim was foreclosed by the availability of a remedy at law. Appellant alleged that Defendant's failure to disclose on the packaging of their chocolate products that upstream labor abuses existing in their cocoa supply chains violated Chapter 93A and that Defendants had been unjustly enriched by this packaging omission. The district court dismissed the claims. The First Circuit affirmed, holding (1) Appellant did not plausibly state a Chapter 93A unfairness claim; and (2) Appellant's unjust enrichment claims must be dismissed because an adequate remedy at law was available to her through Chapter 93A. View "Tomasella v. Nestle USA, Inc." on Justia Law

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In this qui tam action, the First Circuit affirmed the decision of the district court denying the request of Concilio De Salud Integral De Loiza, Inc. (CSILO), on the eve of trial, to amend the pretrial order to include a discussion of damages CSILO claimed it was due under the False Claims Act, holding that the district court did not abuse its discretion when it denied CSILO's request to amend the pretrial order. CSILO, a non-profit organization in Puerto Rico, brought this action under the FCA against JC Remodeling, Inc. (JCR). Three years into litigation and after the close of discovery, CSILO moved the court for leave to amend the pretrial order to include a discussion of damages. The district court denied the request. After a trial, the jury found that JCR had violated the False Claims Act and entered judgment against JCR and imposed on it a $5,500 civil penalty. CSILO appealed, challenging the denial of its request to amend the pretrial order. The First Circuit affirmed, holding that the district court did not abuse its discretion when it decided that CSILO's request to amend the pretrial order would not have cause it "manifest injustice" and would have instead caused prejudice and hardship to JCR. View "Concilio De Salud Integral De Loiza, Inc. v. JC Remodeling, Inc." on Justia Law

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The First Circuit reversed the order of the district court denying arbitration in this negligence case, holding that an arbitration clause in a residency agreement between an assisted living facility and its resident remained in effect and bound Plaintiffs to arbitrate their claims. Plaintiffs, Joan McKenna and her daughter, Kara Biller, brought this lawsuit against Defendant, McKenna's former assisted live-in facility, alleging several claims for Defendant's alleged failure to administer thyroid medication to McKenna while she was a resident. Defendant sought to have the case sent to arbitration, relying on an arbitration clause in McKenna's residency agreement. The district court denied the motion to compel arbitration, concluding that the arbitration agreement had expired. The First Circuit reversed, holding (1) to successfully argue that the arbitration agreement terminated and no longer governed their claims, Plaintiffs had to mount an independent challenge to the arbitration agreement itself, which they failed to do; (2) Plaintiffs' other arguments backing their reasons to affirm the denial of the motion to compel arbitration were unavailing; and (3) therefore, the Federal Arbitration Act required the district court to send this case to arbitration. View "Biller v. S-H OPCO Greenwich Bay Manor" on Justia Law

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The First Circuit affirmed the district court's denial of Novo Nordisk Inc.'s motion for a temporary restraining order and preliminary injunction against Thomas Russomano, one of its former employees, and BioMarin Pharmaceutical, Inc., Russomano's current employer, holding that the district court did not abuse its discretion in finding that Novo Nordisk could not show a likelihood of success on the merits. Novo Nordisk sought to enforce the terms of a confidentiality and non-compete agreement that Russomano signed when he was employed at Novo Nordisk. The agreement prohibited Russomano from working for a competitor for one year after the end of his employment at Novo Nordisk and from disclosing confidential information. The district found that Novo Nordisk was not likely to succeed on the merits. The First Circuit affirmed, holding that the district court did not err in concluding that Novo Nordisk's termination letter was unambiguous that Russomano's employment ended on August 2, 2018. View "Russomano v. Novo Nordisk Inc." on Justia Law

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In this case concerning arbitration agreements, nursing homes, and wrongful death claims under Massachusetts law, the First Circuit affirmed the judgment of the district court compelling arbitration after first certifying two questions to the Massachusetts Supreme Judicial Court (SJC), holding that the SJC's decision compelled the First Circuit to affirmed the judgment compelling arbitration. The personal representative of a deceased former nursing home resident brought a state wrongful death action against a set of organizations that oversaw the nursing home (collectively, nursing home). The nursing home sued to compel arbitration. The federal court compelled arbitration. On appeal, the personal representative argued that she was not bound by the decedent’s agreement to arbitrate with the nursing home because her wrongful death right of recovery was independent of the decedent’s wrongful death claim. The First Circuit certified questions of law to the SJC. After the SJC answered that claims of statutory beneficiaries under the state's wrongful death statute are derivative of the decedent's own cause of action, the First Circuit affirmed the district court's judgment, holding that the SJC's decision required this Court to affirm the judgment compelling arbitration. View "GGNSC Chestnut Hill LLC v. Schrader" on Justia Law

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The First Circuit affirmed the district court's dismissal of the complaint in this case for want of jurisdiction, holding that personal jurisdiction could not constitutionally be exercised over Defendant in Massachusetts. Defendant was an education institution incorporated in Alabama having its principal place of business there. Plaintiff, who had enrolled in Defendant's doctoral program in sports management, sued Defendant in a Massachusetts state court alleging breach of contract, unfair and deceptive business practices, unjust enrichment, and fraudulent inducement. Defendant removed the case to the federal district court then moved to dismiss the complaint for want of personal jurisdiction. The district court granted the motion, concluding that the court lacked general and specific jurisdiction over Defendant. The First Circuit affirmed, holding that the district court appropriately determined that neither general jurisdiction nor specific jurisdiction may constitutionally be exercised over Defendant in Massachusetts. View "Chen v. United States Sports Academy, Inc." on Justia Law

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The First Circuit affirmed the judgment of the district court dismissing Plaintiffs' breach of contract action against Defendant, their insurer, holding that the district court properly dismissed for failure to state a claim Plaintiffs' claim that Defendant failed to defend and indemnify them in a state court action. Newton Covenant Church (NCC) was comprised of members of the Newton Presbyterian Church (NPC) who withdrew from the Presbyterian Church (USA) and affiliated with a non-Presbyterian organization. NPC and the Presbytery of Boston sued the NCC in the state superior court seeking, among other things, a declaratory judgment that NPC owned church property at 75 Vernon Street in Newton, Massachusetts. NCC submitted a notice to the Great American Insurance Company (GAIC) requesting a defense in the state court action under a Director and Officers insurance policy. GAIC denied coverage on the grounds that the named insured under the policy was NPC, not NCC. After the parties reached a settlement NCC and its individual officers (collectively, Plaintiffs) brought this action against GAIC for breach of contract. The district court dismissed the complaint. The First Circuit affirmed, holding that Plaintiffs' allegations were not reasonably susceptible of an interpretation that would state a claim covered under the policy. View "Newton Covenant Church v. Great American Insurance Co." on Justia Law

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The First Circuit affirmed the judgment of the district court granting a preliminary junction to Defendant's former employer (Plaintiff), a healthcare company incorporated in Delaware, that enforced a nonsolicitation clause in the employment contract between the parties, holding that the district court did not err in applying Delaware law to assess whether Plaintiff had satisfied the "likelihood of success" requirement. The injunction sought by Plaintiff enforced a nonsolicitation clause in the parties' contract barring Defendant from engaging in certain work for his new employer, one of Plaintiff's competitors. The choice-of-law provision set forth in the employment contract explicitly stated that the agreement should be interpreted and enforced in accordance with Delaware law, without giving effect to its laws pertaining to conflict of las. The district court held that Massachusetts' choice-of-law rules permitted it to enforce the choice-of-law provision, thus premising its issuance of the preliminary injunction on its application of Delaware law. Defendant appealed, arguing that Massachusetts and not Delaware law applied to Plaintiff's breach of contract claims, and therefore, Plaintiff could not satisfy the likelihood-of-success requirement in seeking a preliminary injunction based on those claims. The First Circuit affirmed, holding that there was no merit in Defendant's challenge to the issuance of the preliminary injunction against him. View "NuVasive, Inc. v. Day" on Justia Law

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The First Circuit affirmed the judgment of the district court granting Defendants' motion to dismiss Plaintiffs' complaint alleging that Defendants knew that Mount Ida College was on the brink of insolvency but concealed this information, holding that Plaintiffs' claims were properly dismissed. Mount Ida, a higher education institution in Massachusetts, permanently closed after providing its students six weeks' notice that it was closing. Plaintiffs, current and prospective students, brought a putative class action against Mount Ida, its board of trustees, and five Mount Ida administrators (collectively, Defendants), alleging seven Massachusetts state law claims. The district court dismissed the complaint. The First Circuit affirmed, holding (1) Plaintiffs' breach of fiduciary duty claim failed; (2) the district court did not err in dismissing Plaintiffs' violation of privacy claim; (3) no claims were stated for fraud, negligent misrepresentation, or fraud in the inducement; (4) Plaintiffs' allegations did not plausibly allege a breach of implied contract; and (5) the district court properly dismissed Plaintiffs' Mass. Gen. Laws ch. 93A claim. View "Squeri v. Mount Ida College" on Justia Law

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In this dispute over the handling of brokerage accounts the First Circuit affirmed the judgment of the federal district court dismissing Plaintiffs' complaint against the Financial Industry Regulatory Authority (FINRA) for failure to state a claim, holding that Plaintiffs' complaint failed to state a plausible claim for breach of the covenant of good faith and fair dealing implied under Massachusetts law. Plaintiffs, a married couple, submitted their dispute with their quondam stockbroker over the handling of their brokerage accounts to FINRA for arbitration. A panel of arbitrators summarily dismissed Plaintiffs' claims. Plaintiffs then brought this action claiming that the arbitrators' failure to state an explained decision breached the implied covenant of good faith and fair dealing. The First Circuit affirmed, holding that the district court appropriately dismissed Plaintiffs' complaint because Plaintiffs did not plausibly allege a breach of the implied covenant. View "Lanza v. Financial Industry Regulatory Authority" on Justia Law