Arla, a Denmark-based global dairy conglomerate, launched a $30 million advertising campaign aimed at expanding its U.S. cheese sales, branded “Live Unprocessed.” The ads assure consumers that Arla cheese contains no “weird stuff” or “ingredients that you can’t pronounce,” particularly, no milk from cows treated with recombinant bovine somatotropin (“rbST”), an artificial growth hormone. The flagship ad implies that milk from rbST-treated cows is unwholesome. Narrated by a seven-year-old girl, the ad depicts rbST as a cartoon monster with razor-sharp horns. Elanco makes the only FDA-approved rbST supplement. Elanco sued, alleging that the ads contain false and misleading statements in violation of the Lanham Act. Elanco provided scientific literature documenting rbST’s safety, and evidence that a major cheese producer had decreased its demand for rbST in response to the ads. The Seventh Circuit affirmed the issuance of a preliminary injunction, rejecting arguments that Elanco failed to produce consumer surveys or other reliable evidence of actual consumer confusion and did not submit adequate evidence linking the ad campaign to decreased demand for its rbST. Consumer surveys or other “hard” evidence of actual consumer confusion are unnecessary at the preliminary-injunction stage. The evidence of causation is sufficient at this stage: the harm is easily traced because Elanco manufactures the only FDA-approved rbST. The injunction is sufficiently definite and adequately supported by the record and the judge’s findings. View "Eli Lilly and Co. v. Arla Foods USA, Inc." on Justia Law

Stabilis Fund II, LLC (Stabilis) held a trust deed on an apartment complex in Indio. In 2013, Stabilis sued the owners of the property, alleging that the underlying loan was in default, seeking judicial foreclosure, and, in the interim, seeking a receiver “to make sure that the Real Property is properly maintained and that property conditions do not pose a risk of harm to tenants and third parties.” On Stabilis’s motion, the trial court appointed a receiver. In 2014, the City of Indio (City) intervened, alleging the property was a public nuisance, riddled with hazardous and substandard conditions in violation of state and local law. It moved to modify the receivership by instructing the receiver to remedy these conditions. Stabilis did not argue that the City was not entitled to the requested modification; however, it did argue that the motion was premature, that the receiver already had the necessary powers, and that it should be allowed to proceed with foreclosure. The trial court nevertheless granted the motion. The City then moved for an award of its attorney fees and expenses. The trial court granted the motion; it awarded the City $98,190.47, to be paid out of the receivership estate, if there were sufficient funds, and if not, then by Stabilis. Stabilis appealed, arguing that it was only the lender: if anyone was liable for attorney fees and expenses, it should have been the owners. More specifically, it argued that none of the three statutes cited by the City authorized the trial court’s award of attorney fees and expenses against it under the circumstances of this case. The Court of Appeal agreed, and reversed. View "Kaura v. Stabilis Fund II, LLC" on Justia Law

The Ninth Circuit affirmed the dismissal of a shareholder derivative action under Federal Rule of Civil Procedure 23.1 for failure to show demand futility. As a preliminary matter, the panel held that binding authority compelled it to apply abuse of discretion review. The panel applied Delaware law and held that the shareholders failed to show demand futility; the Aronson test did not apply in this case because it was limited to board business decisions; and under the Rales test, demand was not excused. View "Tindall v. First Solar Inc." on Justia Law

This case arose from a series of transactions in which petitioners Rocky Mountain Exploration, Inc. and RMEI Bakken Joint Venture Group (collectively, “RMEI”) sold oil and gas assets to Lario Oil and Gas Company (“Lario”). In the transaction, Lario was acting as an agent for Tracker Resource Exploration ND, LLC and its affiliated entities (collectively, “Tracker”), which were represented by respondents Davis Graham & Stubbs LLP and Gregory Danielson (collectively, “DG&S”). Prior to RMEI’s sale to Lario, RMEI and Tracker had a business relationship related to the oil and gas assets that were ultimately the subject of the RMEI-Lario transaction. The RMEI-Tracker relationship ultimately soured; Tracker and Lario reached an understanding by which Lario would seek to purchase RMEI’s interests and then assign a majority of those interests to Tracker. Recognizing the history between Tracker and RMEI, however, Tracker and Lario agreed not to disclose Tracker’s involvement in the deal. DG&S represented Tracker throughout RMEI’s sale to Lario. In that capacity, DG&S drafted the final agreement between RMEI and Lario, worked with the escrow agent, and hosted the closing at its offices. No party disclosed to RMEI, however, that DG&S was representing Tracker, not Lario. After the sale from RMEI to Lario was finalized, Lario assigned a portion of the assets acquired to Tracker, and Tracker subsequently re-sold its purchased interests for a substantial profit. RMEI then learned of Tracker’s involvement in its sale to Lario and sued Tracker, Lario, and DG&S for breach of fiduciary duty, fraud, and civil conspiracy, among other claims. As pertinent here, the fiduciary breach claims were based on RMEI’s prior relationship with Tracker. The remaining claims were based on allegations that Tracker, Lario, and DG&S misrepresented Tracker’s involvement in the Lario deal, knowing that RMEI would not have dealt with Tracker because of the parties’ strained relationship. Based on these claims, RMEI sought to avoid its contract with Lario. Lario and Tracker eventually settled their claims with RMEI, and DG&S moved for summary judgment as to all of RMEI’s claims against it. The district court granted DG&S’s motion. The Colorado Supreme Court granted certiorari to consider whether: (1) Lario and DG&S created the false impression that Lario was not acting for an undisclosed principal (i.e., Tracker) with whom Lario and DG&S knew RMEI would not deal; (2) an assignment clause in the RMEI-Lario transaction agreements sufficiently notified RMEI that Lario acted on behalf of an undisclosed principal; (3) prior agreements between RMEI and Tracker negated all previous joint ventures and any fiduciary obligations between them; (4) RMEI stated a viable claim against DG&S for fraud; and (5) RMEI could avoid the Lario sale based on statements allegedly made after RMEI and Lario signed the sales agreement but prior to closing. The Supreme Court found no reversible error and affirmed. View "Rocky Mountain Exploration, Inc. and RMEI Bakken Joint Venture" on Justia Law

This case arose from a series of transactions in which petitioners Rocky Mountain Exploration, Inc. and RMEI Bakken Joint Venture Group (collectively, “RMEI”) sold oil and gas assets to Lario Oil and Gas Company (“Lario”). In the transaction, Lario was acting as an agent for Tracker Resource Exploration ND, LLC and its affiliated entities (collectively, “Tracker”), which were represented by respondents Davis Graham & Stubbs LLP and Gregory Danielson (collectively, “DG&S”). Prior to RMEI’s sale to Lario, RMEI and Tracker had a business relationship related to the oil and gas assets that were ultimately the subject of the RMEI-Lario transaction. The RMEI-Tracker relationship ultimately soured; Tracker and Lario reached an understanding by which Lario would seek to purchase RMEI’s interests and then assign a majority of those interests to Tracker. Recognizing the history between Tracker and RMEI, however, Tracker and Lario agreed not to disclose Tracker’s involvement in the deal. DG&S represented Tracker throughout RMEI’s sale to Lario. In that capacity, DG&S drafted the final agreement between RMEI and Lario, worked with the escrow agent, and hosted the closing at its offices. No party disclosed to RMEI, however, that DG&S was representing Tracker, not Lario. After the sale from RMEI to Lario was finalized, Lario assigned a portion of the assets acquired to Tracker, and Tracker subsequently re-sold its purchased interests for a substantial profit. RMEI then learned of Tracker’s involvement in its sale to Lario and sued Tracker, Lario, and DG&S for breach of fiduciary duty, fraud, and civil conspiracy, among other claims. As pertinent here, the fiduciary breach claims were based on RMEI’s prior relationship with Tracker. The remaining claims were based on allegations that Tracker, Lario, and DG&S misrepresented Tracker’s involvement in the Lario deal, knowing that RMEI would not have dealt with Tracker because of the parties’ strained relationship. Based on these claims, RMEI sought to avoid its contract with Lario. Lario and Tracker eventually settled their claims with RMEI, and DG&S moved for summary judgment as to all of RMEI’s claims against it. The district court granted DG&S’s motion. The Colorado Supreme Court granted certiorari to consider whether: (1) Lario and DG&S created the false impression that Lario was not acting for an undisclosed principal (i.e., Tracker) with whom Lario and DG&S knew RMEI would not deal; (2) an assignment clause in the RMEI-Lario transaction agreements sufficiently notified RMEI that Lario acted on behalf of an undisclosed principal; (3) prior agreements between RMEI and Tracker negated all previous joint ventures and any fiduciary obligations between them; (4) RMEI stated a viable claim against DG&S for fraud; and (5) RMEI could avoid the Lario sale based on statements allegedly made after RMEI and Lario signed the sales agreement but prior to closing. The Supreme Court found no reversible error and affirmed. View "Rocky Mountain Exploration, Inc. and RMEI Bakken Joint Venture" on Justia Law

At issue in this dissenters’ rights case was the methods by which a trial court may determine the “fair value” of shares of a dissenting shareholder under Tennessee’s dissenters’ rights statutes, Tenn. Code Ann. 48-23-101, et seq. The Supreme Court overruled Blasingame v. American Materials, Inc., 654 S.W.2d 659 (Tenn. 1983), to the extent Blasingame implicitly mandates use of the Delaware Block method for determining the fair value of a dissenting shareholder’s stock and adopted the more open approach set forth in Weinberger v. UOP, Inc., 457 A.2d 701, 712-13 (Del. 1983), which departs from the Delaware Block method and permits fair value to be determined by using any technique or method that is generally acceptable in the financial community and admissible in court. Defendant minority shareholders were forced out of a corporation as a result of a merger. The corporation sought a determination as to the fair value of the minority shareholders’ stock. The trial court may have based its decision to discredit the testimony of the dissenting shareholders’ expert on the basis that Blasingame compelled use of the Delaware Block method to determine stock value. The Supreme Court remanded the case to the trial court to reconsider its valuation determination in light of this decision to partially overrule Blasingame. View "Athlon Sports Communications, Inc. v. Duggan" on Justia Law

Defendants, Nikolaos Pappas and Ascend Medical, Inc. (Ascend), appealed multiple orders of the Superior Court ruling that they misappropriated trade secrets of plaintiff Vention Medical Advanced Components, Inc. d/b/a Advanced Polymers, a Vention Medical Company (Vention), in violation of the New Hampshire Uniform Trade Secrets Act, RSA chapter 350-B (2009) (UTSA). Vention cross-appealed the trial court’s denial of its request for attorney’s fees. Vention is a medical components manufacturer in the medical device industry. Vention makes medical balloons, medical tubing, and heat shrink tubing (HST). Pappas began working at Vention after he graduated from the University of Massachusetts Lowell with a bachelor of science degree in plastics engineering and a master’s degree in innovative and technological entrepreneurship. Prior to working at Vention, Pappas had neither specifically studied HST nor had any experience working with HST. In December 2013, after working for Vention for about ten years, Pappas resigned from the company. During his employment, Pappas was exposed to Vention’s confidential HST technology and information. He also had knowledge of Vention’s business and marketing information and strategies, including the sales volumes for Vention’s various products. At the time he resigned, he was serving as the engineering manager of the HST department. At some point before Pappas resigned, he consulted with an attorney about his obligations under the confidentiality agreement. Almost immediately after leaving Vention, Pappas established Ascend. In late December 2013 and January 2014, the defendants began working with a website developer, communicated with one equipment vendor, and provided an initial machine design to a second equipment vendor. This design included extensive detail and critical specifications of the equipment they wanted built. By August 2014, the defendants began actively marketing HST. After the defendants launched their HST line, Vention requested information about the products. The defendants sent Vention samples of their HST in August and September 2014. After review, the New Hampshire Supreme Court found the trial court determined that the defendants neither willfully and maliciously misappropriated Vention’s trade secrets nor made a bad-faith claim of misappropriation, and there was support in the record for these determinations. Based upon its review of Vention’s arguments and the record, the Supreme Court could not say it was “clearly untenable” or “clearly unreasonable” for the trial court to decline to award fees for bad faith litigation. Accordingly, the Court found no reversible error and affirmed the Superior Court. View "Vention Medical Advanced Components, Inc. v. Pappas" on Justia Law

Defendants, Nikolaos Pappas and Ascend Medical, Inc. (Ascend), appealed multiple orders of the Superior Court ruling that they misappropriated trade secrets of plaintiff Vention Medical Advanced Components, Inc. d/b/a Advanced Polymers, a Vention Medical Company (Vention), in violation of the New Hampshire Uniform Trade Secrets Act, RSA chapter 350-B (2009) (UTSA). Vention cross-appealed the trial court’s denial of its request for attorney’s fees. Vention is a medical components manufacturer in the medical device industry. Vention makes medical balloons, medical tubing, and heat shrink tubing (HST). Pappas began working at Vention after he graduated from the University of Massachusetts Lowell with a bachelor of science degree in plastics engineering and a master’s degree in innovative and technological entrepreneurship. Prior to working at Vention, Pappas had neither specifically studied HST nor had any experience working with HST. In December 2013, after working for Vention for about ten years, Pappas resigned from the company. During his employment, Pappas was exposed to Vention’s confidential HST technology and information. He also had knowledge of Vention’s business and marketing information and strategies, including the sales volumes for Vention’s various products. At the time he resigned, he was serving as the engineering manager of the HST department. At some point before Pappas resigned, he consulted with an attorney about his obligations under the confidentiality agreement. Almost immediately after leaving Vention, Pappas established Ascend. In late December 2013 and January 2014, the defendants began working with a website developer, communicated with one equipment vendor, and provided an initial machine design to a second equipment vendor. This design included extensive detail and critical specifications of the equipment they wanted built. By August 2014, the defendants began actively marketing HST. After the defendants launched their HST line, Vention requested information about the products. The defendants sent Vention samples of their HST in August and September 2014. After review, the New Hampshire Supreme Court found the trial court determined that the defendants neither willfully and maliciously misappropriated Vention’s trade secrets nor made a bad-faith claim of misappropriation, and there was support in the record for these determinations. Based upon its review of Vention’s arguments and the record, the Supreme Court could not say it was “clearly untenable” or “clearly unreasonable” for the trial court to decline to award fees for bad faith litigation. Accordingly, the Court found no reversible error and affirmed the Superior Court. View "Vention Medical Advanced Components, Inc. v. Pappas" on Justia Law

The Ninth Circuit certified the following question to the Supreme Court of California: Does a plaintiff suffer discriminatory conduct, and thus have statutory standing to bring a claim under the Unruh Act, when the plaintiff visits a business's website with the intent of using its services, encounters terms and conditions that deny the plaintiff full and equal access to its services, and then departs without entering into an agreement with the service provider? Alternatively, does the plaintiff have to engage in some further interaction with the business and its website before the plaintiff will be deemed to have been denied full and equal treatment by the business? View "White v. Square, Inc." on Justia Law

The Supreme Court affirmed in part and reversed in part the order of the superior court granting a motion to dismiss brought by Defendants in this case alleging that Defendants, including ESS Group, Inc., violated the Rhode Island Whistleblowers’ Protection Act, R.I. Gen. Laws chapter 50 of title 28 (WPA), and the Rhode Island Business Corporation Act (BCA), R.I. Gen. Laws chapter 7-1.2. The hearing justice determined that Plaintiff’s complaint failed to state a claim upon which relief could be granted and dismissed the action. Specifically, the hearing justice found (1) Defendants’ conduct did not violate the BCA because Rhode Island has no authority to regulate the internal affairs of a foreign corporation, such as ESS, and the provisions that Defendants allegedly violated did not apply because the provisions use the term “corporation,” not “foreign corporation”; and (2) Plaintiff failed to assert a WPA claim premised on Defendants’ alleged BCA violations because ESS was not subject to the BCA. The Supreme Court held (1) Plaintiff was not entitled to relief under the BCA count; but (2) Plaintiff’s complaint sufficiently pled a WPA claim. View "Rein v. ESS Group, Inc." on Justia Law