Justia Contracts Opinion Summaries

Plaintiffs filed a class action against Riceland, requesting the district court compel Riceland to contribute a portion of its recoveries in various cases to the common benefit fund established by the district court to compensate plaintiffs for their legal work. The district court dismissed Riceland's counterclaims of breach of contract and tortious interference and certified the dismissal as a final judgment under FRCP 54(b). The court agreed with its sister circuits and held that a res judicata effect can properly be considered as a “miscellaneous factor” under the Hayden factor analysis. In this case, the district court did not err in considering the res judicata ramification in the Arkansas state court case. The district court found that plaintiffs and the district court itself would suffer injustice if entry of final judgment was delayed. On the merits, the court concluded that the claims regarding genetically-modified rice were released by the Settlement Agreement and Release, but the Release does not govern plaintiffs’ unjust enrichment and quantum meruit claims against Riceland for its failure to contribute to the fund. Accordingly, the court affirmed the district court's judgment. View "Riceland Foods v. Downing" on Justia Law

In 2012, plaintiff Heidi Kroeber was shot outside the Bad Monkey Bar in Kent, Washington by Matthew Atkinson, who was driving an uninsured truck belonging to a friend at the time he opened fire. Plaintiff and her boyfriend had antagonized Atkinson earlier that evening. After pleading guilty to the crime of "Drive-By Shooting," Atkinson claimed that he had not intended to injure anyone and later claimed that he did not know that he was shooting where people were standing. There were factual disputes concerning whether Atkinson's truck was stopped or in motion at the time that he opened fire, and whether he accelerated rapidly away from the scene after the shooting. Plaintiff filed a claim with defendant, GEICO Insurance Company, to recover damages under the UIM coverage provision of her own automobile insurance policy. Under the relevant parts of this policy, GEICO was liable for "damages an insured is legally entitled to recover from the owner or operator of an underinsured motor vehicle due to: 1. bodily injury sustained by that insured and caused by an accident; and 2. the liability of the owner or operator for these damages must arise out of the ownership, maintenance or use of the underinsured motor vehicle." GEICO denied plaintiffs claim, asserting that her injuries did not arise out of the use of Atkinson's truck. Plaintiff sued GEICO, claiming that she was entitled to UIM coverage. The case was removed to the United States District Court for the Western District of Washington, and that court certified two questions to the Washington Supreme Court: (1) whether an injury to an insured pedestrian "arose out of" the intentional firing of a gun from an uninsured pickup truck; and (2) whether it is material if the shooter intended to harm anyone when firing the gun. The Washington Supreme Court answered the first question by holding that an injury "arises out of' vehicle use so long as some causal connection is present between a condition of, an attachment to, or some aspect of a vehicle and the resulting injury. "The converse is also true-·-an injury does not 'arise out of' vehicle use under circumstances where no such causal connection exists, making the vehicle the mere situs of the accident." The Court answered the second question in the negative. View "Kroeber v. Geico Ins. Co." on Justia Law

Scott Harvard was a former senior executive officer of Shore Bank and Hampton Roads Bankshares (HRB). During the 2008 financial crisis, HRB elected to participate in the federal Troubled Assets Relief Program (TARP). The TARP agreement required HRB to comply with the limits on executive compensation set forth in the Emergency Economic Stabilization Act (EESA) and its implementing regulations. In 2009, Harvard terminated his employment. Thereafter, Harvard filed a breach of contract action against Shore Bank and HRB alleging that HRB breached the parties’ employment agreement by refusing to make a “golden parachute payment” pursuant to the agreement. HRB filed a plea in bar, arguing that the prohibition on golden parachute payments in EESA section 111, as implemented by the June Rule, barred it from paying Harvard pursuant to the employment agreement. The circuit court rejected HRB’s argument and awarded Harvard $655,495 plus interest. The Supreme Court reversed and vacated the award of damages in favor of Harvard, holding that EESA section 111, as implemented by the June Rule, prohibited the golden parachute payment under the circumstances of this case. View "Hampton Roads Bankshares, Inc. v. Harvard" on Justia Law

Plaintiff, a construction company, perfected a mechanic’s lien on Defendants’ property and filed a five-count complaint alleging that Defendants breached a contract with Plaintiff to renovate their house by failing to make any payments. The superior court granted summary judgment for Plaintiff on its breach of contract, Prompt Payment Act, and mechanic’s lien claims. Defendants filed a motion to alter or amend judgment pursuant to Me. R. Civ. P. 59, arguing that there existed a genuine issue of material fact as to the time and manner of payment. The court denied the motion and later dismissed the remaining counts of Plaintiff’s complaint. Defendants appealed, arguing that Plaintiff could not succeed on any of its claims because the parties’ oral contract was unenforceable pursuant to the Home Construction Contracts Act. The Supreme Judicial Court affirmed, holding that Defendants failed to preserve this issue for appellate review. View "Warren Constr. Group, LLC v. Reis" on Justia Law

Copia Communications, LLC, a Massachusetts company, brought this action in federal district court in Massachusetts against Seawind Key Investments, Limited, a Jamaican resort operator, and Seawind’s alleged alter-ego, AMResorts, LP, a Pennsylvania limited partnership, alleging breach of contract. The subject contract was proposed and executed in Jamaica, performance on the contract occurred almost exclusively in Jamaica, and the contract was governed by the laws of Jamaica. Both defendants, neither of which operated any business or had any corporate presence in Massachusetts, moved to dismiss, arguing lack of personal jurisdiction and forum non conveniens. The district court dismissed the case without prejudice, finding that it lacked personal jurisdiction over the defendants. The First Circuit affirmed, holding that the exercise of personal jurisdiction over the defendants was barred by the due process clause of the Fifth Amendment. View "Copia Commc’ns, LLC v. AMResorts, LP" on Justia Law

Keller Transport, Inc. leased a tanker truck from Wagner Enterprises, LLC to transport gasoline. The truck’s trailer overturned and spilled 6,380 gallons of gasoline, which flooded several homeowners’ properties. Keller and Wagner were both insured under a commercial transportation policy. Westchester Surplus Lines Insurance Company insured both Keller and Wagner under an excess liability policy. Homeowners initiated suit against Keller and Wagner. Westchester undertook defense of the suit on behalf of Kohler and Wagner pursuant to a reservation of rights and defended Keller and Wagner until the limit of its excess coverage had allegedly been exhausted. Westchester sought a declaration that the limit under its excess policy was $4 million in total and that the limit had been exhausted. As relevant to this appeal, the district court granted summary judgment against Westchester. The Supreme Court affirmed in part and reversed in part, holding that the district court (1) did not err by determining that Westchester’s policy was ambiguous and that it provided an additional $4 million in coverage under the “general aggregate” limit; but (2) erred by holding that Westchester breached its duty to defend the insureds under its policy. View "Westchester Surplus Lines Ins. Co. v. Keller Transport, Inc." on Justia Law

Plaintiff filed suit alleging that HRFC violated the Maryland Credit Grantor Closed End Credit Provisions (CLEC), Md. Code Ann., Com. Law 12-1001 et seq., breached a retail installment sales contract, and violated the Maryland Consumer Debt Collection Act (MCDCA), Md. Code. Ann., Com. Law 14-201 et seq. The district court granted summary judgment to HRFC. The court held that HRFC’s mere failure to disclose an interest rate below CLEC’s statutory maximum is not a distinct violation of section 12-1003(a) for which liability may be imposed; HRFC complied with section 12-1020’s notice requirement and HRFC did not fail to properly cure its error; and the court rejected plaintiff's contention that because the contract incorporates CLEC’s provisions, HRFC is liable for breach of contract for any deviation from CLEC, “regardless of whether HRFC properly cured the failure to comply” with the statute. The court held, however, that a jury could find that HRFC's conduct, at least in the aggregate, could reasonably be expected to abuse or harass plaintiff. Accordingly, the court reversed the district court's order in regard to the MCDCA claim. The court affirmed as to the CLEC and breach of contract claims. View "Askew v. HRFC, LLC" on Justia Law

Plaintiffs, current and former Chicago taxi drivers, paid a “shift fee,” a lease payment that allows the driver to operate one of the defendants’ taxis and earn income. Weekly fees range from $500 to $800 or more. Drivers also pay operating expenses, including fuel, airport taxes, upkeep, and sometimes insurance payments. The drivers do not earn traditional wages or overtime pay. Their only source of income is what they make in fares and tips from passengers. The drivers contend that they often receive less than minimum wage and for some shifts, pay more for fees and expenses than they receive from fares and tips. The Seventh Circuit affirmed dismissal of their class action suit under the Illinois Wage Payment and Collection Act, 820 ILCS 115 and asserting unjust enrichment. The Act defines “wages” as compensation owed by the employer pursuant to an employment agreement between the parties. Even if the drivers were employees under an employment agreement, that agreement did not obligate defendants to compensate the drivers. The Act provides no substantive relief beyond what the underlying employment contract requires. View "Enger v. Chicago Carriage Cab Corp." on Justia Law

Ray Fischer transferred his business assets to CTMI, LLC pursuant to a written asset-purchase agreement. CTMI later filed a second amended petition alleging that portions of the asset-purchase agreement were unenforceable “agreements to agree.” The trial court entered judgment in favor of Fischer. The court of appeals reversed and rendered judgment that the disputed portion of CTMI’s payment obligations was an unenforceable agreement to agree. The Supreme Court reversed, holding that the payment provision at issue was enforceable because its material terms were sufficiently definite to enable a court to determine CTMI’s obligation and provide a remedy for its breach. View "Fischer v. CTMI, LLC" on Justia Law

A fire severely damaged a restaurant that was owned by Plaintiffs. Plaintiffs made a claim to Defendant, the insurer of the restaurant, but Defendant denied the majority of the claim. Plaintiffs filed a breach-of-contract action against Defendant to recover under the insurance policy. A jury returned a verdict for Plaintiffs in the amount of $236,902. Defendant paid this amount plus interest and costs. Three months after judgment was entered, Plaintiffs filed this action against Defendant for “bad faith,” alleging that Defendant lacked an objectively reasonable basis for denying the claim. The district court granted Defendant’s motion for summary judgment, finding that the bad-faith action was barred by claim preclusion. The court of appeals reversed. The Supreme Court vacated the judgment of the court of appeals and affirmed the district court’s grant of summary judgment to Defendant, holding that, under the circumstances of this case, the final judgment in the breach-of-contract suit barred the later tort action for bad faith. View "Villarreal v. United Fire & Cas. Co." on Justia Law