Justia Business Law Opinion Summaries

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In 2010, after decades of cooperation in selling their hardware and software, HP and Oracle had a disagreement over Oracle’s decision to hire HP’s former CEO. The companies negotiated a confidential settlement agreement, including a “reaffirmation clause,” stating each company’s commitment to their strategic relationship and support of their shared customer base. Six months later, Oracle announced it would discontinue software development on one of HP’s server platforms.The trial judge held that the reaffirmation clause requires Oracle to continue to offer its product suite on certain HP server platforms until HP discontinues their sale. A jury subsequently found that Oracle had breached both the express terms of the settlement agreement and the implied covenant of good faith and fair dealing; it awarded HP $3.014 billion in damages. The court denied HP’s request for prejudgment interest. The court of appeal affirmed. The reaffirmation clause requires Oracle to continue to offer its product suite on certain HP server platforms. The trial court did not err in submitting to the jury the breach of contract and implied covenant claims. The court rejected Oracle’s argument that the judgment must be reversed based on violations of its constitutional right to petition and because HP’s expert’s testimony on damages was impermissibly speculative under California law and should have been excluded. View "Hewlett-Packard Co. v. Oracle Corp." on Justia Law

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The Supreme Court affirmed the judgment of the district court granting summary judgment against an investor on grounds that he failed to exercise his appraisal rights in a merger, holding that the investor failed validly to exercise his appraisal rights that had been extinguished.The investor, the beneficial owner of 1.1 million shares, received $39.6 million when the merger transaction closed. The investor objected to the merger and sought to exercise his appraisal rights, but he never obtained the written consent of the record shareholder. The corporation brought this declaratory judgment action. The district court granted summary judgment for the corporation. The Supreme Court affirmed, holding (1) lacking the record shareholder's consent, the investor lost his right to an appraisal; and (2) the investor's waiver and estoppel arguments failed. View "EMC Insurance Group, Inc. v. Shepard" on Justia Law

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Over the course of a few years, an employee of Severin Mobile Towing Inc. (Severin) took about $157,000 in checks made payable to Severin’s d/b/a, endorsed them with what appears to be his own name or initials, and deposited them into his personal account at JPMorgan Chase Bank N.A. (Chase). Because the employee deposited all the checks at automated teller machines (ATM’s), and because each check was under $1,500, Chase accepted each check without “human review.” When Severin eventually discovered the embezzlement, it sued Chase for negligence and conversion under California’s version of the Uniform Commercial Code (UCC), and for violating the unfair competition law. Severin moved for summary judgment on its conversion cause of action, and Chase moved for summary judgment of all of Severin’s claims, asserting affirmative defenses under the UCC, and that claims as to 34 of the 211 stolen checks were time- barred. The trial court granted Chase’s motion on statute of limitations and California Uniform Commercial Law section 3405 grounds; the court did not reach UCL section 3406. The court denied Severin’s motion as moot, and entered judgment for Chase. On appeal, Severin argued only that the court erred in granting summary judgment to Chase on Severin’s conversion cause of action (and, by extension, the derivative UCL cause of action). Specifically, Severin argued the court erroneously granted summary judgment under section 3405 because Chase failed to meet its burden of establishing that Severin’s employee fraudulently indorsed the stolen checks in a manner “purporting to be that of [his] employer.” Severin further argued factual disputes about its reasonableness in supervising its employee precluded summary judgment under section 3406. The Court of Appeal agreed with Severin in both respects, and therefore did not reach the merits of Chase’s claim that its automated deposit procedures satisfied the applicable ordinary care standard. Accordingly, judgment was reversed and the matter remanded for further proceedings. View "Severin Mobile Towing, Inc. v. JPMorgan Chase etc." on Justia Law

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Soliman entered a California Subway sandwich shop. An employee showed her an in-store, hard-copy advertisement, on which Subway offered to send special offers if she texted a keyword. Soliman sent a text message to Subway. Subway began sending her, via text message, hyperlinks to electronic coupons. Soliman alleges that she later requested by text that Subway stop sending her messages, but her request was ignored. She filed suit under the Telephone Consumer Protection Act. Subway moved to compel arbitration, arguing that a contract was formed because the in-store advertisement, from which Soliman got the keyword and shortcode, included a reference to terms and conditions, including an arbitration requirement, located on Subway’s website and provided the URL.The Second Circuit affirmed the denial of the motion to compel arbitration. Under California law, Soliman was not bound by the arbitration provision because Subway did not provide reasonably conspicuous notice that she was agreeing to the terms on the website. Because of barriers relating to the design and content of the print advertisement, and the accessibility and language of the website itself, the terms and conditions were not reasonably conspicuous under the totality of the circumstances; a reasonable consumer would not realize she was being bound to such terms by sending a text message to Subway in order to receive promotional offers. View "Soliman v. Subway Franchisee Advert. Fund Trust, Ltd." on Justia Law

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Beginning in the 1980s and 1990s, two Idaho businesses did roofing work under substantially similar names: one, Gem State Roofing, Inc., performed work primarily in Blaine County (Gem State-Blaine); the other was a corporation operating under the name Gem State Roofing and Asphalt Maintenance, which also did business as Gem State Roofing. The latter was based in Boise, Idaho, and performed work in a significantly larger area. In 2011, Gem State Roofing and Asphalt Maintenance was succeeded in interest by United Components, Inc. (UCI.) Notwithstanding its change of name, it continued to do business as Gem State Roofing. In 2005, prior to UCI’s name change, the two businesses with similar names entered into a Trademark Settlement Agreement (TSA), prohibiting UCI from advertising, soliciting, or performing business in Blaine County, with exceptions for certain services (i.e., warranty, maintenance work, or work performed for previous customers). In addition, UCI agreed that if it received a request for work it was contractually unable to fulfil because of the TSA, it would refer the work to Gem State-Blaine. In 2018, Gem State-Blaine sued UCI, alleging it had breached the TSA when it advertised, solicited, bid on, and performed roofing work in Blaine County, and had failed to refer requests for work as required under the TSA. After a bench trial, the district court concluded that, despite UCI’s breach of the TSA and the implied covenant of good faith and fair dealing, Gem State-Blaine had failed to prove damages or that it was entitled to a permanent injunction. The district court further found that Gem State-Blaine had no protectable common-law trademark. Finally, the district court concluded that there was no prevailing party and declined to award attorney fees and costs. Gem State-Blaine timely appealed. UCI timely cross-appealed the district court’s denial of its request for attorney fees and costs. After review, the Idaho Supreme Court reversed in part, affirmed in part, vacated in part, and remanded for further proceedings. The district court’s refusal to enter a permanent injunction was reversed, and the court directed to enter a permanent injunction to enjoin UCI from any further breach of the TSA. The district court’s refusal to award attorney fees and costs as a sanction for UCI’s discovery violations, and the district court’s conclusion that Gem State-Blaine did not have a protectable common-law trademark against UCI were also reversed. The Supreme Court vacated the district court’s determination that neither party prevailed. The matter was remanded for the district court to determine whether there was a prevailing party, and to determine if attorney fees and costs should be awarded. The district court’s decision denying damages was affirmed. View "Gem State Roofing, Incorp. v. United Components, Inc." on Justia Law

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Evergreen manufactured RVs and sold 21 RVs to several affiliated Boat-N-RV dealers. After delivering those RVs, Evergreen went out of business. The invoices for the 21 RVs totaled $808,663. The dealers resold at least 20 of them to retail customers but did not pay Evergreen or its secured creditor. Evergreen’s lender, with a first-priority blanket security interest in all Evergreen assets, including accounts receivable, filed suit. The lender assigned its rights to Evergreen’s owner.The district court found that the lender’s successor had standing as a secured party and had proven that the dealers had breached the contracts. The court granted the dealers certain setoffs for warranty and rebate claims, and denied prejudgment interest on the net amounts the dealers owed. The Seventh Circuit affirmed. The parties did not intend to erase the security interest at the heart of the transaction and the assignment transferred a priority security interest in the RVs, making the successor the proper plaintiff. Holding the dealers liable for the purchase prices of the RVs but to allowing them setoffs for the rebates and warranty payments that Evergreen ow was the right solution for Evergreen’s failures to pay rebates and warranty obligations; the dealers were not entitled to setoffs for diminished value. View "KR Enterprises, Inc. v. Zerteck Inc" on Justia Law

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AgCountry Farm Credit Services, PCA appealed a district court judgment granting Michael and Bonita McDougall’s unjust enrichment claim and ordering AgCountry to pay $170,397.76. Kent and Erica McDougall were farmers and ranchers who began raising cattle in 2007. Michael and Bonita (collectively, “the McDougalls”) were Kent’s parents. In 2013, Kent and Erica began financing their operations through AgCountry.On various dates Kent and Erica obtained eight loans from AgCountry and signed promissory notes secured by real estate mortgages and security agreements. From fall of 2015 through March 2016, Kent and Erica repeatedly requested AgCountry restructure their loans and assist them in obtaining operating funds. Although Kent and Erica were in default on their loans with AgCountry, they signed a mortgage on the home quarter to AgCountry. When Kent and Erica were informed their request for restructuring was denied, they filed for bankruptcy. As part of the bankruptcy proceedings, Kent and Erica initiated an adversary action against AgCountry and the McDougalls. The complaint in the adversary action asserted a count for avoidance of transfer, for avoidance of the mortgage on the basis of fraud, and to determine the transfer of the home quarter back to the McDougalls from Kent and Erica was appropriate and nonavoidable. Then in 2018, the McDougalls sued AgCountry seeking a declaration that the mortgage on the home quarter was void and asserting claims of deceit, conversion, estoppel and unjust enrichment. AgCountry moved for summary judgment, arguing the McDougalls’ claims failed as a matter of law based on undisputed facts. AgCountry also argued the claims were barred by the prior judgment in Kent and Erica’s bankruptcy proceedings. Summary judgment was granted in favor of AgCountry dismissing the McDougalls’ claims of conversion, promissory estoppel, unjust enrichment and deceit and granting a declaration of superiority in AgCountry’s mortgage on the home quarter. The McDougalls appealed, and a trial ordered on their claims of deceit and unjust enrichment. The jury found in favor of AgCountry on the deceit claim, but in favor of the McDougalls on unjust enrichment. After review, the North Dakota Supreme Court directed the district court to modify the cost judgment, and affirmed as modified. View "McDougall, et al. v. AgCountry Farm Credit Services, et al." on Justia Law

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The Court of Appeals affirmed the order of the Appellate Division affirming the decision of Supreme Court dismissing Plaintiffs' complaint alleging that Defendant engaged in deceptive business practices in violation of N.Y. Gen. Bus. Law (GBL) 349, holding that Plaintiffs' GBL 349 cause of action was properly dismissed.In its motion to dismiss, Defendant argued that Plaintiffs failed to plead the necessary elements of a GBL 349 cause of action. Supreme Court granted Defendant's motion and dismissed the complaint in its entirety. The Appellate Division affirmed. The Court of Appeals affirmed, holding (1) Supreme Court erred in determining that Plaintiffs failed to demonstrate that the allegedly deceptive conduct was consumer oriented; but (2) the complaint was properly dismissed because Plaintiffs did not adequately plead the element of the cause of action that Defendant's act or practice was deceptive or misleading in a material way. View "Himmelstein, McConnell, Gribben, Donoghue & Joseph, LLP v Matthew Bender & Co., Inc." on Justia Law

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Plaintiff filed suit against HealthEast and others, alleging multiple causes of action related to peer review determinations stemming from his practice of neurosurgery. After the district court granted defendants' motion for judgment on the pleadings, three claims remained against appellees: defamation, tortious interference with prospective economic relationship, and tortious interference with contract. Appellees moved for summary judgment on the remaining claims and the district court granted their motion.As to the defamation claims, the Eighth Circuit concluded that only three statements are before the court on appeal because plaintiff did not amend his complaint to incorporate the additional allegedly defamatory statements identified during discovery and, given the requirement that defamation claims be pleaded with specificity, only the statements included in the amended complaint can form the basis of plaintiff's claim. As to the first remaining statement, the court concluded that it was waived. In regard to the two remaining statements, the court concluded that Minnesota peer review immunity applies.As to the tortious interference claims, the court concluded that to the extent these alleged interferences occurred solely through the peer review process itself, appellees are entitled to peer review immunity. In the event peer review immunity does not fully shield appellees, these claims failed on the merits. Accordingly, the district court properly concluded that appellees were entitled to summary judgment on all of plaintiff's claims, and the court affirmed its judgment. View "Sherr v. HealthEast Care System" on Justia Law

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D.C. was employed by Applied, 1996-2008, and claimed three industrial injuries: a specific injury to her neck and right upper extremity in 2001, a specific injury to her neck and both upper extremities in 2005, and a cumulative trauma injury to her neck, both upper extremities, and psyche ending on her last day working. D.C. claimed her injuries were due to the constant use of a computer keyboard. In 2006, she developed a pain disorder, anxiety, and depression, which she claimed were compensable consequences of her physical injuries. She later claimed that she was sexually exploited by Dr. Massey, the physician primarily responsible for the treatment of her industrial injuries. D.C. was diagnosed with PTSD. Applied's workers’ compensation carriers disputed liability for her psychiatric injuries.A workers’ compensation judge found that all of D.C.’s injury claims were industrial; awarded D.C. 100 percent permanent disability (PD) based on her PTSD alone; found no apportionment; and concluded that the insurers were jointly and severally liable for that award since Dr. Massey treated all three of her industrial injuries. The Workers’ Compensation Appeals Board generally affirmed.The court of appeal concluded there was substantial evidence of repeated exposure to injury-causing events and new injuries after 2005 that supported the finding of cumulative trauma ending in 2008. D.C. met her burden of proving that her PTSD was a compensable consequence injury that resulted from the treatment for her industrial injuries and that her employment was a contributing cause; as a matter of law, a patient cannot consent to sexual contact with her physician. The court rejected several challenges to the sufficiency of the evidence. The 100 percent PD award must be annulled as based on an incorrect legal theory, the alternative path theory. View "Applied Materials v. Workers' Compensation Appeals Board" on Justia Law