Justia Contracts Opinion Summaries

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In this case, the Supreme Court of the State of Nevada considered a dispute between LaMont’s Wild West Buffalo, LLC and Nathanial Terry. LaMont’s had acted as an order-buyer to procure 517 bison for Terry’s Montana ranch under an oral agreement. After the bison were delivered, Terry ceased communication and did not pay LaMont’s finder’s fee. LaMont’s sued Terry for breach of contract and related claims. In response, Terry filed frivolous counterclaims, which were later dismissed.After winning the case, LaMont’s sought attorney fees as sanctions under Nevada Rules of Civil Procedure (NRCP) 11 and Nevada Revised Statutes (NRS) 18.010(2)(b) and 7.085. However, the district court denied these motions, finding that LaMont’s had not complied with NRCP 11's safe harbor provision, a procedural requirement for seeking sanctions.On appeal, the Supreme Court of Nevada affirmed in part and reversed in part the lower court's decision. The Court agreed that LaMont’s had not complied with NRCP 11's procedural requirements, and thus was not entitled to attorney fees under this rule. However, the Court held that these procedural requirements did not apply to NRS 18.010(2)(b) and 7.085. The Court concluded that these statutes provided independent mechanisms for sanctions, and as such, the district court had erred in applying NRCP 11's procedural requirements to them. The case was remanded with instructions for the district court to determine whether LaMont’s was entitled to attorney fees under these statutes. View "LaMont's Wild W. Buffalo, LLC v. Terry" on Justia Law

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In a case before the Supreme Court of the State of Oregon, the plaintiffs, Certain Underwriters at Lloyd’s London, sued TNA NA Manufacturing, Inc. and Food Design, Inc., claiming negligence and product liability for a listeria outbreak that resulted from using the defendants' food processing equipment. The outbreak cost the plaintiffs around $20 million. The trial court and Court of Appeals upheld that the plaintiffs had waived any action in tort through their purchase contract with the defendants, as the contract contained a waiver of tort liability. The Supreme Court of Oregon, however, disagreed.The court ruled that, under Oregon law, a contract will not be construed to provide immunity from consequences of a party’s own negligence unless that intention is clearly and unequivocally expressed. The court found that the language in the contract between the plaintiffs and defendants did not meet this standard. The court held that to waive tort liability, contract language must be clear and explicit, stating that the waiver will not be deduced from inference or implication. The text of the contract must unambiguously show that the parties intended to disclaim actions outside of contract, i.e., actions in tort.Consequently, the court reversed the judgment of the circuit court and remanded the case back to the circuit court for further proceedings. The court confirmed that, while no magic words are required for a waiver of tort liability to be effective, the use of terms such as "negligence" or "tort" may be helpful in demonstrating an explicit intent to waive such liability. View "Certain Underwriters v. TNA NA Manufacturing" on Justia Law

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Two individuals, Ronald and Karen White, bought a used car from Real Deal Auto Sales & Service Center, LLC. After experiencing issues with the car, the Whites asked Real Deal to either replace the car's catalytic converters or give them a refund, which Real Deal refused. Subsequently, the Whites repaired the car themselves and sued Real Deal in a small claims action. The District Court ordered Real Deal to pay the Whites $6,000 for the repairs, plus costs. Real Deal appealed this decision to the Superior Court, which reversed the District Court's decision. The Whites appealed this reversal to the Maine Supreme Judicial Court.The Maine Supreme Judicial Court ruled in favor of the Whites, agreeing that the Superior Court erred in reversing the original judgement. The case was therefore remanded for reinstatement of the small claims judgement in favor of the Whites.This decision was based on a Maine law which states that a dealer warrants that a vehicle has been inspected according to rules laid down by the state. Evidence presented by the Whites suggested that parts of the car's exhaust system were inadequate, which could have led the District Court to infer that the car did not meet state inspection standards at the time of sale. As such, the Maine Supreme Judicial Court concluded that the evidence could support a determination that Real Deal breached the warranty of inspectability, thereby violating the Unfair Trade Practices Act. The Court remanded the matter to the Superior Court to enter a judgment affirming the District Court’s small claims judgement in favor of the Whites. View "White v. Real Deal Auto Sales & Service Center, LLC" on Justia Law

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In California, VFLA Eventco, LLC (VFLA), a music festival organizer, sued Starry US Touring, Inc., Kali Uchis Touring, Inc., Big Grrrl Big Touring, Inc., and William Morris Endeavor Entertainment, LLC (WME) over the return of deposits paid to secure the performances of Ellie Goulding, Kali Uchis, and Lizzo at VFLA’s music festival scheduled for June 2020. Due to the COVID-19 pandemic and government restrictions, VFLA cancelled the festival and demanded the return of the deposits from WME, who negotiated the performance contracts and held the deposits as the artists’ agent. VFLA claimed its right to the deposits under the force majeure provision in the parties’ performance contracts. The artists refused VFLA’s demand, claiming VFLA bore the risk of a cancellation due to the pandemic. The trial court granted summary judgment in favor of the artists and WME.The Court of Appeal of the State of California Second Appellate District affirmed the judgment, holding that the trial court properly granted summary judgment in favor of the artists and WME. The court interpreted the force majeure provision as not reasonably susceptible to VFLA’s interpretation, and favoring the artists. The court also held that the artists’ interpretation did not work an invalid forfeiture or make the performance contracts unlawful. View "VFLA Eventco, LLC v. William Morris Endeavor Entertainment, LLC" on Justia Law

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The plaintiff, Yarnell, filed a wrongful death action against Clinton No. 1, Inc., a healthcare and rehabilitation center, alleging that Clinton's negligence led to her mother's death from COVID-19. The Missouri Supreme Court addressed whether Clinton's proposed theories of immunity barred Yarnell's claims, which were based on the Public Readiness and Emergency Preparedness (PREP) Act and two Missouri acts.Yarnell's mother had contracted with Clinton for a private room, but Clinton placed her with a roommate, which Yarnell claimed exposed her mother to COVID-19, violated their agreement, and ultimately led to her mother's death. Clinton argued that Yarnell's claims were barred by the PREP Act, which provides immunity for healthcare providers administering or using covered countermeasures during a public health emergency, and Missouri laws granting immunity to healthcare providers during an emergency declared by the governor and in COVID-19 exposure actions.The court found that Yarnell's petition did not implicate a covered countermeasure under the PREP Act, as it made no reference to the administration or use of a diagnostic test or any other covered countermeasure. The court also found that Clinton failed to demonstrate it agreed to be deployed during the emergency or that the governor or any state agency acted on such agreement and deployed Clinton, which would have entitled it to immunity under Missouri law. Lastly, the court noted that Yarnell had adequately alleged her harm was caused by Clinton's recklessness, and the two COVID-19 statutes would not foreclose relief if Yarnell were able to prove such recklessness. Therefore, the court quashed its preliminary writ of mandamus, allowing Yarnell's case to proceed. View "State ex rel. Clinton No. 1 vs. Baker" on Justia Law

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This case involves Avue Technologies Corporation ("Avue") and the Secretary of Health and Human Services and the Administrator of the General Services Administration. Avue is a software development company that sells its software to private and government entities, which helps them automate administrative tasks while complying with statutory, regulatory, and policy requirements. Avue does not sell its software licenses directly to federal agencies. Instead, it sells annual subscriptions through third party Carahsoft Technology Corporation (“Carahsoft”), an authorized reseller that has a Federal Supply Schedule (“FSS”) contract with the General Services Administration (“GSA”).Avue tried to govern its relationship with end users of its software through an end-user licensing agreement ("EULA"), which is incorporated into the FSS contract between Carahsoft and the GSA. In 2015, the Food and Drug Administration ("FDA") placed a task order for a subscription to Avue's software under the FSS contract. However, in 2016, the FDA chose not to renew its subscription, leading Avue to claim that the FDA had violated its EULA.The Civilian Board of Contract Appeals ("Board") dismissed Avue's appeal for lack of jurisdiction, stating that even if the EULA established a contract between Avue and the U.S. Government, the Board lacked jurisdiction because the EULA was not a procurement contract within the meaning of the Contract Disputes Act ("CDA"). Avue appealed this decision to the United States Court of Appeals for the Federal Circuit.The court disagreed with the Board's decision, stating that Avue only needed to allege non-frivolously that it had a contract with the U.S. Government to establish the Board's jurisdiction, and it didn't need to prove the existence of such a contract. The court held that Avue's allegation that it was part of a procurement contract was non-frivolous and sufficient to establish the Board's jurisdiction. Therefore, the court vacated the Board's dismissal and remanded the case for further proceedings on the merits. View "AVUE TECHNOLOGIES CORPORATION v. HHS " on Justia Law

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This case is focused on a business dispute regarding the formation and ownership of a limited liability company. The plaintiff contends that he had an agreement with the defendant to have equal ownership in the business. However, the company was allegedly improperly formed with the defendant as the sole owner. The plaintiff alleges that this resulted in a breach of contract. The district court ruled in favor of the defendant, citing the statute of limitations and the statute of frauds as grounds for dismissal.The dispute originated from the formation of Helping Hands Capital, LLC, a Texas-based company that provided pre-settlement medical advancement loans. The plaintiff claimed that he was supposed to be an equal owner in the business, but the defendant was the only one listed as the managing member in the company's formation documents. The plaintiff claimed that after a third partner transferred his interests back to the company, the defendant told him that they were now 50/50 partners. However, in 2018, the defendant clarified that the plaintiff only had an "economic benefit" in the company and did not have "legal ownership". The plaintiff claimed that this was when he was excluded from the business, leading to his breach of contract claim.The United States Court of Appeals for the Fifth Circuit affirmed the lower court's decision. The appeals court only addressed the applicability of the statute of frauds, which requires certain contracts to be in writing. The court held that the agreement fell within the statute of frauds because the agreement's performance required more than a year, and the evidence does not unequivocally support the existence of a profit-sharing contract. View "Chase v. Hodge" on Justia Law

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In the case before the United States Court of Appeals for the Sixth Circuit, State Farm Mutual Automobile Insurance Company ("State Farm") brought a lawsuit against Michael Angelo, alleging violations of the Racketeer Influenced and Corrupt Organizations Act ("RICO"). The lawsuit claimed that Angelo submitted fraudulent bills to the insurance company. Angelo later filed a separate action against State Farm under the False Claims Act ("FCA"), alleging that the insurance company wrongfully avoided paying medical benefits. This action was unknown to State Farm at the time because FCA complaints are required to be filed under seal.The two parties entered into a settlement agreement in February 2021, resolving the RICO action. As part of the agreement, Angelo agreed to take all necessary steps to dismiss certain claims against State Farm. After the settlement agreement was signed, the FCA complaint was unsealed and served on State Farm. State Farm then sought to enforce the settlement agreement, arguing that it required Angelo to dismiss the FCA action as well.Angelo argued that the settlement agreement did not apply to the FCA action because the FCA claims were unrelated to the settled RICO claims. However, the district court disagreed and ordered Angelo to seek the government's consent to dismiss his FCA claims against State Farm. Angelo appealed this decision, claiming it violated his First Amendment rights and the FCA.The Court of Appeals affirmed the district court's decision, stating that the settlement agreement clearly encompassed the FCA action. The court also held that the district court had not erred in requiring Angelo to seek the government's consent to dismiss his FCA claims. Angelo's First Amendment claim was deemed forfeited as it was raised for the first time in a motion for reconsideration and was thus untimely. View "State Farm Mutual Automobile Insurance Co. v. Angelo" on Justia Law

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The United States Court of Appeals for the Tenth Circuit affirmed convictions against Whitney McBride and her company, Odyssey International Inc., for fraudulent conduct in obtaining a government contract. McBride was convicted of five offenses, including wire fraud, major fraud, and making a false declaration. She appealed the convictions, arguing that they should be vacated based on a Supreme Court case decided after her conviction, Ciminelli v. United States, which dealt with the interpretation of federal fraud statutes. She also contended that her conviction for making a false declaration should be vacated due to errors in the jury instructions.The court rejected her arguments, finding that she had waived her challenges to the convictions for conspiracy, wire fraud, and major fraud because she invited error by proffering the jury instruction she now disputed. The court also found that she waived her challenges due to her numerous procedural errors, including failing to argue for plain error on appeal and failing to meet the requirements of the Federal Rules of Appellate Procedure. The court concluded that she had waived her arguments and affirmed her convictions. View "United States v. McBride" on Justia Law

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The Eleventh Circuit Court of Appeals ruled on a class action lawsuit that involved a life insurance policy dispute between plaintiff Worth Johnson and defendant Protective Life Insurance Company. Johnson alleged that Protective breached its contract by not reassessing and adjusting its cost of insurance (COI) rates based exclusively on expectations of future mortality experience. The district court granted Protective’s motion for judgment on the pleadings, concluding that Protective did not breach its insurance contract.On appeal, the Eleventh Circuit affirmed the district court's decision in part, agreeing that the policy did not require Protective to reassess and redetermine its COI rates based exclusively on its expectations as to future mortality experience. However, the court reversed the district court's dismissal of Johnson's alternative claim that Protective did reassess and redetermine its COI rates, but ignored its expectations as to future mortality experience when doing so. The court remanded the case for further proceedings consistent with its ruling. View "Johnson v. Protective Life Insurance Company" on Justia Law