Justia Contracts Opinion Summaries

Plaintiffs bought a townhouse condominium unit from Defendant. After the sale, repairs of leaks in the other condominium units caused by poor construction required the condominium board to collect special assessments in the amount of $65,000 from each unit holder, including Plaintiffs. Recoupment from the builder offset the sum, but Plaintiffs remained out-of-pocket over $40,000. Plaintiffs sued Defendant, alleging fraud and equitable fraud due to Defendant's allegedly insufficient disclosures made to Plaintiffs before the sale. The Court of Chancery entered judgment in favor of Defendant, holding (1) Plaintiffs failed to prove Defendant committed common-law fraud because they failed to show Defendant misrepresented or omitted some material fact before the sale of the condominium; and (2) rescission was not warranted under the facts of this case, and therefore, equitable fraud was inappropriate. View "Grzybowski v. Tracy" on Justia Law

Claimant sustained injuries in a car accident. The car was insured under a standard Massachusetts automobile insurance policy (auto policy) issued by Liberty Mutual that included optional "medical payments" coverage (MedPay). Claimant was also insured under a separate policy of health insurance issued by Blue Cross Blue Shield (Blue Cross). Liberty Mutual paid personal injury protection benefits to Claimant and Claimant's additional medical expenses. After Liberty Mutual declined to pay Claimant any MedPay benefits because Blue Cross had already submitted the expenses, Claimant commenced this action against Liberty Mutual on behalf of herself and a putative class of similarly situated individuals. On remand, the superior court granted Liberty Mutual's motion for judgment on the pleadings. The Supreme Court reversed, holding that Claimant was entitled to the MedPay benefits provided by her auto insurance policy, notwithstanding that her medical expenses were covered by and paid under a separate policy of health insurance. Remanded. View "Golchin v. Liberty Mut. Ins. Co." on Justia Law

Taurus sued DaimlerChrysler, alleging that external websites infringed its patent for “a computer system for managing product knowledge related to products offered for sale by a selling entity.” Daimler Chrysler asserted license and release defenses, asserted a breach of contract counterclaim, and filed a contract claim against third-party defendants (including Orion), which, it claimed violated a 2006 patent licensing agreement between DaimlerChrysler and Orion, to settle prior patent infringement suits. The district court entered summary judgment, finding that the accused websites did not infringe any asserted claims and that certain claims were invalid as anticipated by prior art. The district court found the DaimlerChrysler suit to be exceptional under 35 U.S.C. 285, and awarded damages of $1,644,906.12, for costs incurred in Chrysler’s defense. With respect to remaining issues, the district court: found that certain third parties were alter egos and declined to dismiss for lack of jurisdiction; held that the 2006 agreement did not provide a release to the infringement alleged in the patent suit; held that issues of fact remained as to whether certain third parties had breached a warranty in the 2006 agreement; held that Orion had breached the warranty; and imposed sanctions on Orion and another for pre-trial witness tampering (those parties were not permitted to present evidence to support their defense that Chrysler did not rely on the warranty). The Federal Circuit affirmed, except with respect to attorney fees. View "Taurus IP, LLC v. DaimlerChrysler Corp." on Justia Law

Defendants, the children of the late Jack Kirby, one of the most influential comic book artists of all time, appealed the district court's grant of summary judgment to Marvel. This case concerned the property rights in 262 works published by Marvel between 1958-1963. After defendants served various Marvel entities with Termination Notices purporting to exercise statutory termination rights under section 304(c)(2) of the Copyright Act of 1976, 17 U.S.C. 304, Marvel filed suit seeking a declaration that defendants have no termination rights under section 304(c)(2). The court concluded that the district court lacked personal jurisdiction over Lisa and Neal Kirby and, therefore, vacated the district court's judgment against them; Lisa and Neal are not indispensable parties and it was appropriate for the action against Barbara and Susan Kirby to have proceeded on its merits; the district court did not err in determining as a matter of law that the works at issue were "made for hire," made at Marvel's instance and expense, and that the parties had no agreement to the contrary; and the district court properly granted Marvel's motion for summary judgment as to Susan and Barbara, who were without termination rights under section 304(c). View "Marvel Characters, Inc. v. Kirby" on Justia Law

About thirty years ago, the Municipality of Mayaguez and Corporacion Para el Desarrollo del Oeste (CPDO), a local development corporation, executed a contract under which Mayaguez ceded parcels of land to CPDO with the understanding that the land would be used for a project to be developed in accordance with the Department of Housing and Urban Development's (HUD) Community Development Block Grant program guidelines and regulations. After the relationship between the parties soured, Mayaguez filed this complaint against CPDO, alleging that CPDO violated several HUD regulations, thus breaching its contract. The district court ruled in favor of CPDO and dismissed Mayaguez's claims without prejudice. The First Circuit Court of Appeals vacated the district court's judgment, holding that Mayaguez's commonwealth law claim did not "arise under" federal law within the meaning of 28 U.S.C. 1331. Remanded with instructions to dismiss Mayaguez's claim without prejudice for want of subject matter jurisdiction. View "Municipality of Mayaguez v. Corporacion Para El Desarrollo Del Oeste, Inc." on Justia Law

The Knowles owned rental property in Clinton, Massachusetts that was mortgaged with Fidelity Co-operative Bank (Fidelity) and insured by Nova Casualty Company (Nova). In 2008, a tropical storm brought heavy rain that caused substantial damage to the interior of the Knowles' building. The Town of Clinton ordered the building to be closed. Because the Knowles could not afford to make repairs to the building, it remained vacant. The Knowles submitted a claim for reimbursement for the water damage with Nova, which denied the claim. The building was later vandalized, causing further damage. Nova also refused coverage on this damage. The Knowles subsequently defaulted on their mortgage. In 2010, Fidelity, individually and as assignee of the Knowles, filed a complaint against Nova seeking a declaration that the physical losses suffered by the property and the loss of business income to the Knowles was covered by their all-risk insurance policy. The district court granted summary judgment for Nova. The First Circuit Court of Appeals reversed, holding that the water damage was covered under the policy because the policy's coverage extended to both damage "caused by" or "resulting from" rain as well as damage resulting from the entry of "surface water." Remanded. View "Fidelity Coop. Bank v. Nova Cas. Co." on Justia Law

Plaintiffs Michael Hirsch, Robyn Hirsch, and Hirsch, LLP, claimed that they lost money invested in securities that were part of a "Ponzi" scheme. In 2002, plaintiffs' accountant, EisnerAmper LLP, referred them to Marc Scudillo, a financial advisor employed by Amper Financial Services, LLC (AFS), for investment planning. Scudillo also served as a representative for Securities America, Inc. (SAI), a separate corporation that served as a broker-dealer handling securities transactions. Plaintiffs hired Scudillo and invested in a portfolio with a conservative investment strategy. Their relationship was not reduced to a written contract. On Scudillo's recommendation, plaintiffs purchased securitized notes from Medical Provider Financial Corporation (Med Cap) totaling $550,000. Plaintiffs signed two applications with SAI for the purchase of the Med Cap notes. Each SAI application contained an arbitration clause requiring disputes to be arbitrated by the Financial Industry Regulatory Authority (FINRA). The issue before the Supreme Court in this appeal was whether it was proper to compel arbitration between a non-signatory and a signatory to a contract containing an arbitration clause on the basis that the parties and claims were sufficiently intertwined to warrant application of equitable estoppel. The Supreme Court held that although traditional contract principles may in certain cases warrant compelling arbitration absent an arbitration clause, the relationship of the parties in this case and the claims in dispute here, viewed alone, was insufficient to warrant application of equitable estoppel to compel arbitration. View "Hirsch v. Amper Financial Services, LLC" on Justia Law

Residential filed suit against Terrace alleging breach of contract when Terrace refused to repurchase loans Residential purchased from Terrace. The court rejected, under Minnesota law, Terrace's argument that the contract provisions at issue were mere conditions precedent; Terrace identified no ambiguity in the language of the contract which would permit the court to look beyond its plain language; even if it were entitled to do so, Terrace presented no support for its claim that litigation conduct was a more revealing source of the contracting parties' intent than the language of the contract itself; the on-demand repurchase provision did not make the contract unenforceable for lack of consideration; the demand repurchase provision does not make the contract unconscionable; Residential did not act in bad faith; Terrace's waiver and prior breach arguments were rejected, as well as Terrace's arguments regarding other specified loans; and the district court did not abuse its discretion in awarding damages to Residential or in its calculation of Residential's attorneys' fees and costs. Accordingly, the court affirmed the judgment. View "Residential Funding Co. v. Terrace Mortgage Co." on Justia Law

In 2004, Sellers entered into a real estate purchase contract with Buyers. A portion of the purchase price was to be financed through a third-party purchase money mortgage by Bank. Another portion of the purchase price was to be provided through seller financing, known as vendor purchase money mortgage. Sellers executed a warranty deed conveying the property to Buyers. Buyers executed a deed of trust naming Bank as beneficiary and a trust deed evidencing Seller financing. Bank's trust deed was subsequently assigned to Wells Fargo Bank. After closing, Buyers defaulted on their obligations to both Bank and Sellers. In 2005, Wells Fargo foreclosed on the property. The property was then ultimately conveyed to Defendant. In 2009, Sellers assigned their interest in the outstanding Sellers trust deed to Plaintiff. Plaintiff recorded a notice of default, stating that it had elected to sell the property to satisfy the amount owing. The district court granted summary judgment for Defendant, concluding that Defendant had taken the property as a bona fide purchaser. The Supreme Court affirmed, holding that Plaintiff, as vendor purchase money mortgagee, may have a superior claim of right, but its claim was barred by the doctrine of laches. View "Insight Assets, Inc. v. Farias" on Justia Law

Whitney Schwan died in an automobile accident after Travis Turner, the driver, lost control of the vehicle. Whitney's parents sued Travis's estate and his parents (the Turners). The Turners had a homeowners policy with State Farm Fire and Casualty Company (State Farm). State Farm filed an action seeking a declaration that it owed no duty to defend or indemnify the Turners under the homeowners policy. Meanwhile, a mediation concluded with a settlement that included assignment of all of the Turners' rights and claims under the homeowners' policy to the Schwans, and the Schwans replaced the Turners in the declaratory action. The district court granted summary judgment to the Schwans on its counterclaim that State Farm had breached its duty to defend the Turners by not retaining separate counsel for the Turners in the underlying action. The Supreme Court reversed, holding that the district court erred by concluding that State Farm had breached its duty to defend under the policy, as State Farm did ensure a full defense was provided to the Turners even though its decisions regarding counsel did not include hiring additional counsel. View "State Farm Fire & Cas. Co. v. Schwan" on Justia Law