Justia Contracts Opinion Summaries

Plaintiffs (the Friedmans) purchased a professional archery retail sporting goods business owned by Aaron and Constance Lasco. The Lascos entered a covenant not to compete with the Friedmans that was incorporated into the purchase and sale agreement. After the sale was final, Aaron Lasco went to work at Sportsman & Ski Haus (Sportsman). Sportsman subsequently expended its business to include a new archery department. Thereafter, the Friedmans filed several breach of contract claims against the Lascos, including breach of the covenant not to compete. The Friedmans also requested a preliminary injunction to stop Aaron Lasco from further employment at Sportsman until their claims were resolved. The district court found the covenant not to compete was valid and granted the Friedmans’ preliminary injunction request. The Supreme Court affirmed the district court’s decision to grant a preliminary injunction to the Friedmans, holding that the Friedmans demonstrated that they were likely to succeed on the merits of their claims against the Lascos. View "Friedman v. Lasco" on Justia Law

Pacific Steel & Recycling entered into a contract with Emineth Custom Homes to build four duplex apartment units. The contract specified that Pacific would advance a $474,625 down payment to Emineth upon execution of the contract. After canceling the contract for the duplexes Pacific brought an action against Emineth seeking recovery of the down payment made to Emineth under the contract. Emineth counterclaimed, alleging breach of contract and other claims. A jury determined that Emineth did not breach the contract with Pacific but that Pacific breached the contract with Emineth. The jury awarded $238,241 in Emineth’s favor. The district court entered judgment on the verdict in favor of Emineth but ordered that Emineth’s jury award in its favor become a judgment against Emineth and in favor of Pacific for $236,189. The Supreme Court affirmed in part and reversed in part, holding (1) the jury’s verdict with regard to the finding that Pacific breached the contract with Emineth stands; but (2) the district court in rendering the judgment made a factual determination contrary to the verdict returned by the jury. Remanded for entry of a judgment of $238,241 against Pacific and in favor of Emineth. View "Pacific Hide & Fur Depot v. Emineth Custom Homes, Inc." on Justia Law

GSS appealed the district court’s dismissal of its second attempt to confirm a $44 million arbitral award entered against the Port Authority for breach of a construction contract. GSS first tried to confirm the award, but the district court found that it had no personal jurisdiction over the Port Authority. Then GSS filed its second petition, also naming the Republic of Liberia, which owns the Port Authority, as respondents. The district court again dismissed GSS’s petition, finding that issue preclusion barred relitigating its personal jurisdiction over the Port Authority and that GSS failed to demonstrate that Liberia was liable for the Port Authority’s alleged breach. The court affirmed the district court's dismissal of the claims against Liberia for lack of subject matter jurisdiction under the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. 1330 et seq.; affirmed the district court's dismissal of GSS's petition against the Port Authority on sovereign immunities grounds; and concluded that the district court did not abuse its discretion by dismissing GSS's petition before allowing jurisdictional discovery. View "GSS Group Ltd. v. Republic of Liberia" on Justia Law

This legal battle began in 2006 when American Biomedical Group, Inc. (ABGI) and ABG Cattletraq, LLC (Cattletraq) filed a petition in the district court against Techtrol, Inc. and William Ardrey (Defendants); Defendants then filed a counterclaim. ABGI and Cattletraq dismissed their claims and causes of action against Defendants (without prejudice), leaving Defendants' counterclaim pending. Two years later, Defendants filed a petition in the same court against ABGI, Cattletraq, and James Burgess, their sole shareholder and CEO (Plaintiffs). In 2009, Plaintiffs filed another petition alleging that Defendants "wrongfully exercised dominion and control over plaintiffs' personal and intellectual property" and "willfully, deliberately and maliciously converted plaintiffs' personal and intellectual property" for their own benefit. Plaintiffs sought damages based on Defendants' unjust enrichment from the conversion. The district court consolidated the three cases. When the cases were consolidated, Defendants' counterclaim, Defendants' petition alleging abuse of process, and Plaintiffs' petition alleging causes of action for conversion and unjust enrichment remained pending before the district court. In 2014, Defendants moved for summary judgment on Plaintiffs' claim for conversion, asserting that Oklahoma did not recognize a tort for conversion of intangible property, and for unjust enrichment, asserting Plaintiffs' claim was precluded because they had an adequate remedy at law for breach of contract. The question this appeal presented for the Supreme Court's review was whether Defendants supported their motion for summary judgment with undisputed, material facts sufficient to warrant the district court granting partial summary adjudication in their favor. After that review, the Court answered in the negative. "Defendants failed to show that they were entitled to summary judgment. Throughout their arguments before the district court and this Court, Defendants rely on allegations which they have failed to allege as undisputed in their motion for summary judgment, which have no supporting evidentiary materials, and which Plaintiffs contest or which Plaintiffs have not admitted." View "American Biomedical Group, Inc. v. Techtrol, Inc." on Justia Law

Jeff Lokey and Mike Irwin were business partners in two Wyoming businesses. After the parties dissolved their shared business interests, Irwin filed suit against Lokey, alleging that Lokey had materially breached the terms of the agreement. When Lokey did not timely file an answer the district court entered a default judgment against Lokey that included a provision allowing the parties ten days to file objections to the judgment. Lokey filed an objection, which the district court denied. Lokey appealed, challenging the court’s denial of his objections. The Supreme Court dismissed the appeal, holding (1) the Court lacked jurisdiction to entertain the appeal because Lokey did not timely appeal an appealable order; but (2) the Court had jurisdiction to award, and Irwin was entitled to recover, reasonable attorney fees incurred as a result of this appeal. View "Lokey v. Irwin" on Justia Law

USA Power, LLC developed a power plant project in Mona, Utah called the “Spring Canyon vision.” Meanwhile, PacifiCorp entered into negotiations to purchase USA Power’s Spring Canyon assets, and USA Power provided PacifiCorp with details on the entire project. PacifiCorp terminated the negotiations, however, and began construction on a power plant project in Mona that was very similar to the Spring Canyon project. PacifiCorp also retained Jody Williams, USA Power’s former attorney, to help it obtain water rights for its project, called the Currant Creek project. USA Power brought suit against Williams, asserting malpractice claims for Williams’s alleged breach of her fiduciary duties of confidentiality and loyalty, and against PacifiCorp, alleging misappropriation of USA Power’s trade secrets. The trial court granted summary judgment for Defendants. The Supreme Court reversed. On remand, the jury returned a special verdict against PacifiCorp and Williams. The trial court reduced the unjust enrichment award against PacifiCorp, granted Williams’s judgment notwithstanding the verdict motion for lack of evidence related to causation, and determined that USA was entitled to attorney fees. Both parties appealed. The Supreme Court affirmed the trial court’s rulings as to each issue presented on appeal, holding that the court did not err in its judgment. View "USA Power, LLC v. PacifiCorp" on Justia Law

In 2003, a closely held corporation purchased a United life insurance policy on Clark, then its President. Buck, its COO, was the beneficiary. Clark thought that the $1 million death benefit would enable Buck to buy out his stock from Clark’s family. The policy was amended so that the benefit would go to the corporation. In 2005 Clark retired and sold his interest to Holtz, the firm’s new President. Buck remained as COO. Holtz owned 61% of the stock and Buck the rest. Holtz received a copy of the policy, including the amendment naming the corporation as the beneficiary. Another copy was in corporate files. Clark died in 2011. Buck told Holtz that the company was the beneficiary, but United paid the money to Buck. When Buck tried to use the proceeds to buy Holtz’s stock, he was removed from the board and quit as COO. The corporation sued. United conceded that the corporation was the beneficiary, but argued that the corporation knew the truth and allowed Buck to claim the money, carrying out the plan devised by Clark and Buck. During discovery,the corporation then admitted finding the amendment earlier. The judge entered summary judgment in favor of United. The Seventh Circuit affirmed, rejecting an argument that Holtz was misled by United’s error and had no reason to think that the corporation was the beneficiary. The corporation’s knowledge, not Holtz’s, is dispositive. View "Samaron Corp. v. United of Omaha Life Ins. Co." on Justia Law

In 2010, Bail Bonds and Hamza jointly and severally secured a $75,000 appearance bond on behalf of Mohammed-Ali, an Ethiopian national (Hamza’s cousin), charged with smuggling a controlled substance, (khat), into the U.S., 18 U.S.C. 545. One condition of the sureties’ obligation was that Mohammed-Ali “comply with all conditions of release imposed by this court,” which included that he wear a GPS ankle bracelet. But 15 months later—at Mohammed-Ali’s request and without objection from the government—the court entered an order allowing him to remove the ankle bracelet. Neither counsel nor the court provided the sureties with notice of the motion or of the order. Mohammed-Ali fled to Ethiopia. The government sought judgment against the sureties. The district court granted the government summary judgment, reasoning that Bonds had constructive notice of the motion because it could have accessed the docket for Mohammed-Ali’s case, using the court’s electronic-filing system. The Sixth Circuit reversed. The risk the sureties agreed to accept was that Mohammed-Ali might flee notwithstanding his conditions of release, which included the ankle bracelet. That risk included the possibility that Mohammed-Ali might saw off bracelet and then flee. What the sureties did not accept was that the court would remove the bracelet for him. The purported “notice” was inadequate. View "United States v. Mohammed-Ali" on Justia Law

Between 2002-2006, Lucht purchased treated lumber for a deck on his vacation home in the Virgin Islands. The lumber allegedly decayed prematurely and he began replacing boards in 2010; he claims he did not discover the severity of the problem until the fall of 2011. Lucht sued the retailer, wholesaler, and treatment company of the lumber in February 2013, alleging a Uniform Commercial Code contract claim; a common law contract claim; a breach of warranty claim; a negligence claim; a strict liability claim; and a deceptive trade practices claim under the Virgin Islands Deceptive Trade Practices Act. The district court rejected the claims as time-barred. The Third Circuit affirmed, citing the “‘gist of the action doctrine,” which bars plaintiffs from bringing a tort claim that merely replicates a claim for breach of an underlying contract. View "MRL Dev. I, LLC v. Whitecap Inv. Corp" on Justia Law

Attorney Fleisher worked for two affiliated law firms. In 2013 Fleisher filed a written demand with the firms, claiming that when he retired, in 2011, he had accrued more than 90 weeks of unused vacation time and more than 322 days of unused sick leave, and that the firms were required by contract and by the Illinois Wage Payment and Collection Act, to pay him for those accruals. He estimated that he was owed about $950,000. The defendants sent a copy of Fleisher’s complaint to Hartford, seeking coverage under the “Employee Benefits Liability Provision” of their Business Owners Policy. It took five months for Hartford to reply that the matter was under consideration. Two months later Hartford denied coverage and sought a declaration that the insurance policy did not cover Fleisher’s claim, alleging that the failure to pay Fleisher was not the result of any negligent act, error, or omission in the administration of the employee benefits program, which was all that the policy covered. The district judge ruled that Hartford had no duty to defend under Illinois law and granted summary judgment. The Seventh Circuit affirmed, holding that delay was not a valid ground for estopping Hartford to deny coverage or a duty to defend. View "Hartford Cas. Ins. Co v. Karlin, Fleisher & Falkenberg" on Justia Law