Justia Contracts Opinion Summaries

The Army solicited proposals for aerial target flight operations and maintenance services. Kratos provided these services under a predecessor contract. The solicitation listed three evaluation factors: Technical/Management; Past Performance; and Price/Cost to be rated as “outstanding,” “satisfactory,” “marginal,” or “unsatisfactory.” The contract was subject to the Service Contract Act of 1965, under which the Federal Acquisition Regulation requires that “successor contractors … in the same locality must pay wages and fringe benefits … at least equal to those contained in any bona fide collective bargaining agreement … under the predecessor contract.” The Army received three proposals, including the offers from SA-TECH and Kratos. After review, the Technical Evaluation Committee announced a Final Evaluation Report, noting potential difficulties for SA-TECH under the Labor sub-factor, but rating SA-TECH as “outstanding” for all factors. Kratos also received “outstanding” ratings. The Source Selection Authority concluded that SA-TECH offered the best value for the government. Kratos filed a protest with the Government Accountability Office. SA-TECH subsequently protested the Army’s decision to engage in corrective action instead of allowing SA-TECH’s award to stand. The Claims Court denied the Army’s motion to dismiss and found the Army’s actions unreasonable and contrary to law. The Federal Circuit affirmed. View "Sys. Application & Tech., Inc. v. United States" on Justia Law

After the corporate office of Steak N Shake restaurants tried to require one of its franchisees to adopt a new policy for menu pricing and promotions, the franchisee sued Steak N Shake in a declaratory judgment action and later filed a motion for a preliminary injunction in order to stop the implementation of the new policy. The franchise, in operation since 1939, is the oldest in the country and previously had the ability to set its own prices. The district court found that in the absence of an injunction, the franchisee would have its franchises terminated and would suffer irreparable harm and granted a preliminary injunction. The Seventh Circuit affirmed. There was sufficient evidence to find, as a threshold matter, that the franchise would suffer irreparable harm if it was forced to implement Steak N Shake’s pricing policy. View "Stuller, Inc. v. Steak N Shake Enter., Inc." on Justia Law

Appellants James Baldwin and Ronda Reynolds allegedly sustained injuries in separate highway incidents after objects came loose from unidentified vehicles and collided with their vehicles. Both Appellants sought uninsured motorist (UM) coverage for hit-and-run accidents through their automobile insurance policies. Baldwin's State Farm policy provided coverage when an uninsured motor vehicle "strikes" the insured vehicle, and Reynolds's Safeco policy covered damages when an uninsured motor vehicle "hits" the insured vehicle. The Supreme Court accepted review in these consolidated cases to focus on whether Appellants' accidents satisfied the impact requirements contained in the UM clauses of their insurance policies. The Supreme Court held that the impact requirements of the UM clauses of Baldwin's and Reynolds's insurance policies were not met, and therefore, UM coverage was not applicable to Appellants' hit-and-run accidents. View "State Farm Mut. Auto. Ins. Co. v. Baldwin" on Justia Law

Appellants, individually and on behalf of all others similarly situated, filed a class action complaint against their Internet service providers (Providers). Providers' Internet service agreement contained an arbitration clause that required customers to submit damage claims against Insight to arbitration, and it barred class action litigation against Providers by their customers. The circuit court determined the class action ban was enforceable and dismissed Appellants' complaint. The court of appeals affirmed. The Supreme Court affirmed in part and reversed in part, holding (1) the contractual provision under which Appellants waived their right to participate in class action litigation was enforceable under federal law; (2) the service agreement's choice of law provision was not enforceable; (3) the service agreement's general arbitration provision was enforceable; and (4) the provision imposing a confidentiality requirement upon the litigants to arbitration proceedings was void and severable from the remaining portions of the agreement. Remanded for entry of a final judgment. View "Schnuerle v. Insight Commc'ns Co., LP" on Justia Law

At issue in this appeal was the question of an agent's authority to bind his or her principal to an arbitration agreement presented with other documents upon the principal's admission to a long-term care facility. Agent in this case was the daughter and executrix of the deceased Principal. Agent brought a claim for negligence against the long-term care facility where Principal spent the last years of her life. Invoking an arbitration agreement executed in conjunction with Principal's admission to the nursing home, Defendants moved the trial court to dismiss the complaint. The trial court denied the motion, holding that Agent, who executed the admissions agreement on behalf of Principal, had no authority to agree to arbitration. The court of appeals reversed, holding that the agreement was enforceable. The Supreme Court reversed, holding that the optional arbitration agreement Agent purported to execute on Principal's behalf was beyond the scope of Agent's authority and was therefore unenforceable. View "Ping v. Beverly Enters., Inc." on Justia Law

This appeal concerned the construction of a single word, "sudden," within a pollution exclusion clause in a series of liability insurance policies barring coverage for certain damages unless the events causing those damages were "sudden and accidental" (an issue of first impression in New Mexico). Concluding that "sudden" lacks a single clear meaning, the Supreme Court reversed the Court of Appeals' holding that the word unambiguously signifies "quick, abrupt, or a temporarily short period of time. . . .Under well-established principles of insurance law," the Court construed this ambiguity in favor of the insured, Petitioner United Nuclear Corporation, and interpreted the term "sudden" in the insurance policies at issue in this dispute to mean "unexpected." the case was remanded to the district court for further proceedings. View "United Nuclear Corp. v. Allstate Ins. Co." on Justia Law

Missouri Bank sued OneBeacon for breach of contract and vexatious refusal to pay. The court held that the district court did not err by granting summary judgment for Missouri Bank on its breach-of-contract claim and rejected OneBeacon's claim that it did not breach Insuring Agreement (D) by denying Missouri Bank's claim because Insuring Agreement (D) did not cover losses resulting from fraudulent faxes. The court also held that the district court's finding that OneBeacon had reasonable cause to deny Missouri Bank's vexatious refusal to pay claim was not clearly erroneous. View "Missouri Bank and Trust Co. v. OneBeacon Ins. Co." on Justia Law

Plaintiffs, provider of automated licensing services to state fish and wildlife agencies, sued GreatLodge for fraudulent inducement, among other things, arising out of an acquisition agreement. GreatLodge subsequently appealed the district court's finding for plaintiffs, rescinding the acquisition. The court held that the district court did not err in its credibility determinations or in its findings; in finding that plaintiffs' reliance was justified; and in awarding restitution and avoidance of plaintiffs' scheduled yearly payments to GreatLodge. View "Outdoor Central, Inc., et al. v. GreatLodge.com, Inc." on Justia Law

Jerry and Martha Garrison witnessed their son's injuries after he was struck by a car. The son died afterwards. The Garrisons filed a claim for negligent infliction of emotional distress against the owner and driver of the car. The Garrisons also served a copy of the complaint upon their insurance company, State Farm, pursuant to the uninsured motorist provisions of their policy. The policy covered damages for "bodily injury," and "bodily injury" was defined in the policy as "bodily injury to a person and sickness, disease, or death that results from it." The trial court determined that the "bodily injury" provision of the uninsured motorist statute covered mental injuries, and therefore, the policy provided, by operation of law, coverage for the Garrisons' emotional distress claim. The court of appeals reversed. The Supreme Court affirmed, holding (1) as applied to this case, "bodily injury" did not include damages for emotional harm alone; and (2) the definition of "bodily injury" in the policy did not conflict with the uninsured motorist statute. View "Garrison v. Bickford " on Justia Law

A home remodeling contractor (Contractor) received a demand for arbitration regarding allegedly defective work it performed on a remodeling project. Contractor's insurer (Insurer) accepted defense of the claim under a reservation of rights. The arbitrator issued an arbitration award in favor of the homeowners. When Insurer refused to pay the award, Contractor paid the homeowners and sued Insurer for indemnification under the policy. The district court granted Contractor's motion for summary judgment, concluding that a vague arbitration award made it impossible to determine whether the insurance policy covered any of the homeonwers' successful claims and was directly attributable to the inaction of the attorney appointed by Insurer to represent Contractor. The court of appeals reversed. The Supreme Court reversed, holding (1) a portion of the homeowners' claim may be covered under the policy; (2) Insurer was not vicariously liable of the absence of an explanation of the arbitration award; and (3) Insurer was directly liable to Contractor for the failure of the attorney to request an explanation of the arbitration award to determine what portion of the award, if any, was for the covered claim. Remanded. View "Remodeling Dimensions, Inc., v. Integrity Mut. Ins. Co." on Justia Law