Justia Contracts Opinion Summaries

BLB, an aviation company, brought contract claims against Jet Linx and others, and Jet Linx counterclaimed. The court concluded that Jet Linx's tender of a check and BLB's act of depositing the check did not amount to an accord and satisfaction; the district court did not clearly err by finding that BLB did not agree to the terms of the August 2008 letter at issue and, as a result, the district court did not err by rejecting Jet Linx's defense of accord and satisfaction; the court affirmed the district court's judgment for BLB with respect to its claim for unpaid lease payments under the dry lease agreement (DLA) and the award of $141,400 to BLB; the court affirmed the district court's judgment for BLB on its claim that Jet Linx breached the management services agreement (MSA) by "marking up" the cost of maintenance; the court reversed and remanded the district court's judgment with regard to Jet Linx's failure to maintain the maintenance records and part tags where it was error to choose diminution in values as the appropriate measure of BLB's damages; and the court affirmed the district court's judgment in favor of Jet Linx on its counterclaim for breach of the MSA and the award of damages to Jet Linx. View "BLB Aviation South Carolina v. Jet Linx Aviation, LLC, et al." on Justia Law

Minnesota-based Everest breeds and races thoroughbreds. Crestwood is a thoroughbred farm in Kentucky. The businesses began working together in 1993. The parties entered a more definite arrangement in 2008, for sale of Everest’s horses. Everest would transfer ownership of more than 100 horses to Crestwood, which would pay the horses’ day-to-day costs and would sell the horses at a public auction or a private sale. The agreement prohibited Crestwood from setting a “reserve” on any horse, a price floor below which the sale would not go. Crestwood was to keep 25-50 percent of the proceeds from each sale. The agreement provided that Island Fashion and its unnamed filly would be sold at auction, but remained Everest’s property. Crestwood tried to sell several horses, including the Island Fashion filly. There were bids of $850,000 and $875,000 for the filly. Everest had planted a separate agent at the auction without Crestwood’s knowledge, who tried to drive the selling price higher by placing a $900,000 bid. The sale failed. After learning what Everest had done, Crestwood kept $219,513.89, 25 from selling other horses based on the failed high bid for the filly (plus auction fees). Everest sued and Crestwood counterclaimed. The district court granted summary judgment to Crestwood and awarded $272,486.30 in attorney’s fees. The Sixth Circuit affirmed. View "Nielsen v. McLean" on Justia Law

Monsanto developed a genetic modification in soybean seeds (Roundup Ready® (RR)), known as the 40-3-2 event (RR trait), which enables soybean plants to tolerate application of glyphosate herbicide to kill weeds. Monsanto owns the patent for the RR trait and granted Pioneer a license to produce and sell seeds containing the traits. After Pioneer became a subsidiary of DuPont, Monsanto and Pioneer entered into an amended license, under which DuPont produced and sold RR trait seed. In 2006, DuPont announced that it had developed a glyphosate-tolerant trait, OGAT, expected to confer tolerance to both glyphosate and acetolactate synthase inhibitor herbicide. Testing indicated that OGAT alone did not provide sufficient glyphosate-tolerance for commercial use. DuPont then combined OGAT with the RR trait; the OGAT/RR stack provided increased yields in field trials. DuPont did not sell any OGAT/RR product, however, and discontinued development. Monsanto sued DuPont for breach of the license and patent infringement. The district court granted partial judgment to Monsanto, holding that the license was unambiguous and did not grant the right to stack non-RR technologies with the licensed” trait, but allowed DuPont to amend its answer to assert reformation counterclaims and defenses. The court ultimately told DuPont to “either voluntarily dismiss these reformation claims or produce … all documents … previously withheld.” DuPont continued litigating its reformation counterclaims and produced previously withheld internal e-mails that showed its awareness that it did not have the right to commercialize the OGAT/RR stack. The court found that DuPont’s position was not rooted in fact, that DuPont made misrepresentations and had perpetrated a fraud on the court, struck DuPont’s reformation defense and counterclaims, and awarded limited attorney fees to Monsanto. The Federal Circuit affirmed. View "Monsanto Co. v. E.I. du Pont de Nemours & Co." on Justia Law

In consolidated cases, thirty-two plaintiffs who signed delayed-deposit check agreements with Zippy Check Advance agreed that Zippy Check could pursue judicial remedies against them to collect the debt, while any and all of their claims would be relegated to arbitration. The circuit courts found the arbitration agreements to be unconscionable and denied Zippy Check’s motions to compel arbitration. The Court of Appeals affirmed as to one version of the agreement and reversed as to the other. Upon review, the Supreme Court found that both versions of the arbitration agreement were so one-sided that they were substantively unconscionable and unenforceable. The Court affirmed in part and reversed in part the judgment of the Court of Appeals and affirmed the judgments of the Circuit Court of Clarke County and the Circuit Court of Newton County. View "Caplin Enterprises, Inc. v. Arrington" on Justia Law

ATP Tour, Inc. (ATP) operates a global professional men’s tennis tour. Its members include professional men’s tennis players and entities that own and operate professional men’s tennis tournaments. Two of those entities are Deutscher Tennis Bund (DTB) and Qatar Tennis Federation. ATP is governed by a seven-member board of directors, of which three are elected by the tournament owners, three are elected by the player members, and the seventh directorship is held by ATP’s chairman and president. In 2007, ATP’s board voted to change the Tour schedule and format. Under the board’s “Brave New World” plan, the Hamburg tournament, which the Federations owned and operated, was downgraded from the highest tier of tournaments to the second highest tier, and was moved from the spring season to the summer season. Displeased by these changes, the Federations sued ATP and six of its board members in the United States District Court for the District of Delaware, alleging both federal antitrust claims and Delaware fiduciary duty claims. After a ten-day jury trial, the District Court granted ATP’s and the director defendants’ motion for judgment as a matter of law on all of the fiduciary duty claims, and also on the antitrust claims brought against the director defendants. The jury then found in favor of ATP on the remaining antitrust claims. Four questions of Delaware law were certified to the Supreme Court from the U.S. District Court for the District of Delaware when the Federations appealed. The questions centered on the validity of a fee-shifting provision in a Delaware non-stock corporation’s bylaws. The provision, which the directors adopted pursuant to their charter-delegated power to unilaterally amend the bylaws, shifts attorneys’ fees and costs to unsuccessful plaintiffs in intra-corporate litigation. The federal court found that the bylaw provision’s validity was an open question under Delaware law and asked under what circumstances such a provision was valid and enforceable. Although the Delaware Supreme Court could not directly address the bylaw at issue, it held that fee-shifting provisions in a non-stock corporation’s bylaws could be valid and enforceable under Delaware law. In addition, bylaws normally apply to all members of a non-stock corporation regardless of whether the bylaw was adopted before or after the member in question became a member. View "ATP Tour, Inc., et al. v. Deutscher Tennis Bund, et al." on Justia Law

This case involved a pirated shipment of disk drives, two logistics contracts, and application of the Carmack Amendment, 49 U.S.C. 14706, a federal law regulating the interstate transportation of goods. The court concluded that Megatrux failed to show that the shipper was given a reasonable opportunity to choose between two or more levels of liability or that it had obtained agreement to any level below the Carmack Amendment's default measure of full liability. Therefore, the court affirmed the district court's finding of full liability. The court found no clear error in the district court's determination that the customs invoices, photographs, and recovered disk drives provided sufficient evidence of the condition and contents of the stolen shipment. The district court erred in finding UPS's claim for indemnification of attorney's fees to be preempted by the Carmack Amendment. Accordingly, the court affirmed the district court's ruling that Megatrux bears full liability for Seagate's actual loss and its finding that UPS sufficiently proved the contents of the subject shipments. The court reversed the determination that UPS's claim for attorney's fees under the indemnification clause of the Master Transportation Services Agreement was preempted and remanded for further proceedings. View "UPS Supply Chain Solutions v. Megatrux Transp., Inc." on Justia Law

A Bank and Re/Max Realty One signed a listing agreement granting Re/Max the exclusive right to sell a certain property. A buyer signed a purchase-and-sale agreement with the Bank and paid $86,900 in earnest money, which Re/Max held in escrow. The buyer later defaulted under the terms of the agreement. Re/Max subsequently procured a second buyer to purchase the property. After participating in mediation, the Bank and the first buyer agreed the divide the earnest money between themselves, with $49,500 going to the Bank and $37,400 to the buyer. Re/Max sent a $37,400 check to the buyer and a check for $24,750 to the Bank, retaining the remaining $24,750. The Bank sued Re/Max for breach of the listing agreement stemming from Re/Max’s retention of $24,750 of the earnest money. The superior court granted summary judgment to the Bank. The Supreme Court vacated the judgment of the superior court, holding that Re/Max was entitled to summary judgment on the Bank’s breach of contract claim because the unambiguous language of the listing agreement obligated the Bank to divide any forfeited earnest money with Re/Max, including money the Bank received pursuant to its mediated agreement with the first buyer. View "Bank of New York Mellon, N.A. v. Re/Max Realty One" on Justia Law

Northern, operated by VanDuinen, was a general contractor on public construction projects, legally required to obtain surety bonds. Hanover was Northern’s bonding agent and required Northern to enter into an Indemnity Agreement, which VanDuinen signed in his individual capacity and as Northern’s President. The Midway Airport Project was financed by the FAA and managed by Parsons. In 2008 Northern won the bid and began subcontracting. in 2009 subcontractors complained that Northern failed to pay them in accordance with the bonds and contracts. Work was halted, resulting in a separate complaint, by Parsons, for failure to complete the Project as required. The FAA opted to retain possession of remaining contract funds, $127,086.00, pending resolution of the disputes and completion of the work. Hanover received claims from subcontractors McDaniel ($127,452.78) and Rex Electric ($78,495.00) and a claim for performance from Parsons. Hanover demanded collateral under the Agreement. Northern refused to post collateral or to indemnify Hanover. In 2009 McDaniel filed for bankruptcy; the bankruptcy trustee sued Hanover seeking payment for work performed. In 2012, Hanover paid the trustee $127,452.78 to resolve both McDaniels’s and Rex Electric’s claims. Hanover resolved Parson’s claim by stepping in as general contractor and arranging for completion of the Project. Parsons paid Hanover the $127,086.00 of contract funds the FAA had withheld. Hanover sued Northern and VanDuinen. The district court granted summary judgment in Hanover’s favor. The Seventh Circuit affirmed. The Agreement is unambiguous. Northern breached it, and Hanover is entitled to contractual damages. View "Hanover Ins. Co. v. Northern Bldg. Co." on Justia Law

Abraham and Betty Jean Morrow filed a request for a modification of their home loan, serviced by Bank of America, through the federal Home Affordable Modification Program. Bank of America denied the modification and scheduled a trustee’s sale of the property. The Morrows subsequently filed a complaint against Bank of America based on the bank’s alleged breach of an oral contract for modification of their loan. The district court granted summary judgment to Bank of America, concluding (1) the Morrows’ claims for breach of contract, fraud, and violation of the Montana Consumer Protection Act (MCPA) were barred by the Statute of Frauds; and (2) the Morrows could not succeed on their claims of negligence, negligent misrepresentation, and tortious breach of the covenant of good faith and fair dealing because Bank of America owed no duty to the Morrows. The Supreme Court reversed as to the negligence, negligent misrepresentation, fraud, and violations of MCPA claims, holding that Bank of America owed a duty to the Morrows, genuine issues of material fact existed as to some claims, and the Statute of Frauds did not preclude the remainder of the Morrows’ claims. View "Morrow v. Bank of Am., N.A." on Justia Law

Plaintiffs entered into a contract for professional services with CTA, Inc., a firm offering architectural, engineering, and construction management services. Plaintiffs filed a complaint against CTA and others, alleging that Defendants negligently designed and constructed Plaintiffs’ home and that CTA breached its contract with Plaintiffs. CTA filed a motion to dismiss, which the district court treated as a motion for summary judgment, on grounds that the contract was subject to mandatory arbitration. Plaintiffs filed a cross-motion for partial summary judgment, alleging that the arbitration clause in the contract was unenforceable. The district court granted partial summary judgment for Plaintiffs. The Supreme Court reversed, holding that the arbitration clause was enforceable because it was within Plaintiffs’ reasonable expectations and was not oppressive, unconscionable, or against public policy. View "Day v. CTA, Inc." on Justia Law