Justia Contracts Opinion Summaries

DynCorp contracted with the U.S. Department of State to assist in the development of a civilian police force in Iraq and subcontracted with PMC for operations and maintenance support. PMC filed suit against DynCorp alleging that DynCorp breached its contract with PMC by making payments to one account instead of another. The court affirmed the district court's dismissal of PMC's case against DynCorp as a sanction for its discovery malfeasance. The court rejected PMC's arguments on appeal because they did not support reversal of the district court's orders. View "Projects Mgmt. Co. v. DynCorp Int'l LLC" on Justia Law

Crockett’s former law firm subscribed to a LexisNexis legal research plan that allowed unlimited access to certain databases for a flat fee. Subscribers could access other databases for an additional fee. According to Crockett, LexisNexis indicated that a warning sign would display before a subscriber used a database outside the plan. Years after subscribing, Crockett complained that his firm was being charged additional fees without any warning that it was using a database outside the Plan. LexisNexis insisted on payment of the additional fees. The firm dissolved. Crockett’s new firm entered into a LexisNexis subscription agreement, materially identical to the earlier plan; it contains an arbitration clause. Crockett filed an arbitration demand against LexisNexis on behalf of two putative classes. One class comprised law firms that were charged additional fees. The other comprised clients onto whom such fees were passed. The demand sought damages of more than $500 million. LexisNexis sought a federal court declaration that the agreement did not authorize class arbitration. The district court granted LexisNexis summary judgment. The Sixth Circuit affirmed. “The idea that the arbitration agreement … reflects the intent of anyone but LexisNexis is the purest legal fiction,” but the one-sided adhesive nature of the clause and the absence of a class-action right do not render it unenforceable. The court observed that Westlaw’s contract lacks any arbitration clause.View "Reed Elsevier, Inc. v. Crockett" on Justia Law

Sasafrasnet, an authorized distributor of BP products, provided Joseph with notice of its intent to terminate his franchise based on three occasions when Sasafrasnet attempted to debit Joseph’s bank account to pay for fuel deliveries but payment was denied for insufficient funds. The district court denied Joseph a preliminary injunction, finding that Joseph failed to meet his burden for a preliminary injunction under the Petroleum Marketing Practices Act 15 U.S.C. 2805(b)(2)(A)(ii). After a remand, the district court found that two of Joseph’s NSFs should count as “failures” under the PMPA justifying termination, at least for purposes of showing that he was not entitled to preliminary injunctive relief. The Seventh Circuit affirmed. Joseph’s bank account was not adequately funded for the debit on two occasions because Joseph had decided to change banks, circumstances entirely within Joseph’s control. Given Joseph’s history of making late payments in substantial amounts because of insufficient funds (each was more than $22,000), the delinquent payments were not “technical” or “unimportant.” View "Joseph v. Sasafrasnet, LLC" on Justia Law

Bruce Martin filed suit against CTB for negligent misrepresentation and breach of express warranty after the power sweeps it purchased from CTB did not work. The court concluded that it's decision in Dannix Painting, LLC v. Sherwin-Williams foreclosed Bruce Martin's argument that the district court erred in concluding that Missouri's economic loss doctrine precluded its negligent misrepresentation claim. Further, the court concluded that the district court did not err in granting summary judgment to CTB on Bruce Martin's breach of express warranty claim. Under Indiana law, the court agreed with the district court that Bruce Martin had alleged a defect in the design of the sweeps that was not covered by CTB's warranty against "defects in material and workmanship." Accordingly, the court affirmed the judgment of the district court. View "Bruce Martin Construction, Inc. v. CTB, Inc." on Justia Law

The issue before the Supreme Court in this case centered on whether Delaware’s personal injury protection (PIP) statute requires insurers to reserve PIP benefits for lost wages when requested. The plaintiff suffered severe injuries as a passenger in a car accident. While he was in a coma, his mother signed an assignment of insurance benefits in favor of the hospital. Plaintiff did not challenge the validity of the assignment. The hospital was promptly paid by the insurance company. When plaintiff later requested the insurers to reserve his PIP benefits for his past and future lost wages, he was informed that the benefits had been exhausted by the payment to the hospital. The Superior Court held sua sponte that the unchallenged assignment to the healthcare provider was invalid. Upon review of the facts of this case, the Supreme Court concluded the Superior Court erred as a matter of law in deciding that uncontested issue. Because the assignment on behalf of the plaintiff resulted in the exhaustion of his PIP benefits before the plaintiff requested the reservation of PIP benefits for his lost wages, the legal issue of whether the insurer was required to reserve PIP benefits for lost wages is moot. View "State Farm Mutual Automobile Insurance Co. v. Davis" on Justia Law

John Hardy leased part of land to Littlebrook Airport Development Co. (LADC). John Hardy died, leaving his wife Jean as the sole surviving owner of the leased property. In 2005, Jean sold the leased property to and assigned her interest in the lease to Littlebrook Ventures (LV), which executed a mortgage in Hardy's favor. Pursuant to the mortgage LV agreed not to modify the lease without Hardy's prior consent. LADC then assigned its interest in the lease to Windmill USA. Windmill and LV purported to amend the lease in accordance with a previously executed declaration amendment. LV later conveyed the property back to Hardy by a deed in lieu of foreclosure. Hardy purchased the property at a foreclosure sale and conveyed it to Sweet Peas, LLC. Littlebrook Airport Condominium Association then brought this action seeking a declaratory judgment clarifying the rights of the parties pursuant to the lease. At issue was the effectiveness of the unrecorded amendment to the lease that violated the recorded mortgage covenant. The superior court concluded that the lease amendment was effective. The matter came before the Supreme Court on report. The Court discharged the report, concluding that acceptance of the report would improperly place the Court in the role of an advisory board. View "Littlebrook Airpark Condo. Ass'n v. Sweet Peas, LLC " on Justia Law

Sweet Valley Missionary Baptist Church filed a complaint against its insurance carrier, Alfa Insurance Corporation. Based on Sweet Valley’s failure to cooperate in discovery, the trial court entered an order of dismissal. Sweet Valley then filed a motion to set aside judgment, or, in the alternative, a motion for new trial. The trial court denied the motion, and, in response, Sweet Valley filed a second complaint against Alfa the same day. The trial court dismissed the second claim based on the expiration of the statute of limitations. Sweet Valley appealed. On rehearing, the Court of Appeals reversed the trial court’s judgment and remanded for further proceedings. Alfa filed a petition for writ of certiorari, and the Supreme Court granted it. Upon review, the Supreme Court held that a motion filed pursuant to Mississippi Rule of Civil Procedure 59(e) tolls the applicable statute of limitations, and it reversed the decision of the trial court. View "Sweet Valley Missionary Baptist Church v. Alfa Insurance Corporation" on Justia Law

This case involved an uninsured motorist benefits claim filed in connection with injuries allegedly sustained by the appellant in a 2001 motor vehicle accident. Appellant was driving a truck insured by Harleysville Insurance Company when he rear-ended another vehicle. The police report contained no mention of a phantom vehicle being involved in the accident. Appellant later reported the accident to his employer, explaining he momentarily took his eyes off the road, and when he looked again, a vehicle was stopped in front of him; he was unable to stop and rear-ended the vehicle. Twenty days later, appellant completed a written Workers’ Compensation Employee’s Statement in which he reported the accident occurred due to the other vehicle stopping suddenly in front of him. But again, no phantom vehicle was reported. Over eight months later, appellant filed a claim for uninsured motorist benefits, alleging the accident was caused by a phantom vehicle pulling out in front of the other vehicle, causing appellant to stop suddenly. Harleysville denied appellant’s claim and sought a declaratory judgment that he was not entitled to uninsured motorist benefits. The Superior Court reversed the order of the Court of Common Pleas of Luzerne County, which held appellee Harleysville Insurance Company did not suffer prejudice as a result of appellant’s failure to report the phantom vehicle within a 30-day time requirement established by the Motor Vehicle Financial Responsibility Law (MVFRL). Upon review, the Supreme Court affirmed the Superior Court decision. View "Vanderhoff v. Harleysville Ins. Co." on Justia Law

James Leach, IDA Marketing Corporation, and IDA of Moorhead Corporation appealed a judgment holding them jointly and severally liable to Reed Danuser for claims involving Danuser's termination as president and chief executive officer of the corporations and Leach's breach of a fiduciary duty to Danuser and requiring IDA Moorhead to pay Danuser for loans he made to IDA Moorhead. Upon careful analysis of the inter-company agreements and facts presented at the district court, the Supreme Court affirmed, finding: (1) James Leach was responsible for freezing out Danuser's interests in the corporations, which, as found by the court, involved more than just the wrongful termination of Danuser's employment; (2) Leach was not a party to a stock buy-sell agreement, and under the circumstances of this case as found by the district court involving the freeze out of Danuser's interests in the intertwined corporations, the court's determination of damages was not a misapplication of the law and was not arbitrary, unreasonable, or unconscionable; (3) both James Leach and IDA Moorhead gained from James Leach's actions, which were attributable to the corporation. The district court decided James Leach had control of the corporations when he breached his fiduciary duties to Danuser. Therefore, the district court did not misapply the law in deciding James Leach and the corporations were jointly and severally liable for Danuser's damages and the court's decision was not arbitrary, unreasonable, or unconscionable. View "Danuser v. IDA Marketing Corp." on Justia Law

Motor Carriers filed suit against defendants under 49 U.S.C. 13706(b) of the Interstate Commerce Commission Termination Act. At issue was whether, absent a federal tariff, federal courts have subject matter jurisdiction over a motor carrier's breach of contract claim against a shipper for unpaid freight charges. The court concluded that it lacked jurisdiction over the appeal under the Act, finding that the district court lacked jurisdiction to adjudicate the dispute. Accordingly, the court vacated the judgment of the district court and remanded with instructions to dismiss. View "Gaines Motor Lines, Inc. v. Klaussner Furniture Ind." on Justia Law