Justia Business Law Opinion Summaries

HYC Logistics, a Tennessee-based logistics provider, entered into a contract with OJCommerce (OJC), a Florida-based importer, to transport consumer goods from the Port of Los Angeles to OJC’s California warehouse. While the contract included provisions regarding liens, attorney’s fees, and Tennessee law, payment terms were negotiated separately by email. HYC Logistics billed OJC for various services, but OJC contested the charges, claiming they were inflated, and left a substantial balance unpaid despite making a partial payment. When OJC attempted to cancel a shipment, HYC Logistics exercised its lien rights over nine shipping containers and withheld delivery pending payment.The United States District Court for the Western District of Tennessee presided over the case, which involved both parties asserting multiple claims. A jury found OJC liable for breach of contract and validated HYC Logistics’ exercise of its lien, awarding damages to HYC Logistics. The jury also found HYC Logistics liable for violating the Tennessee Consumer Protection Act (TCPA) and for intentional or reckless misrepresentation, awarding damages to OJC on these claims. Post-trial motions resulted in the district court vacating the TCPA verdict against HYC Logistics but upholding the misrepresentation verdict. The court granted HYC Logistics attorney’s fees and denied OJC’s request for fees, and it rejected a motion for Rule 11 sanctions brought by Weiss, OJC’s owner.The United States Court of Appeals for the Sixth Circuit reviewed the consolidated appeal. It affirmed the district court’s rulings, upholding the jury’s verdicts on breach of contract and lien rights, finding no error in the jury instructions or damages awards, and agreeing with the district court’s grant of attorney’s fees to HYC Logistics. The Sixth Circuit also affirmed the denial of prejudgment interest and Rule 11 sanctions, concluding there was no abuse of discretion or objective unreasonableness in the district court’s decisions. View "HYC Logistics, Inc. v. OJCommerce, LLC" on Justia Law

Two cousins established a custom T-shirt company in 2012, entering into agreements governing equal ownership and joint authorization of disbursements. One founder took medical leave in 2017, allegedly delegating management duties and compensation to the other. During his absence, he claims he was denied access to company financial records and excluded from payment decisions, contrary to the agreements. The business declined, and in 2023, the founder sold his share for $550,000, releasing all related claims. He later discovered purportedly suspicious financial payments and asserts he would not have agreed to the buyout had he known about them. The company was acquired and dissolved in 2024. The founder then brought federal RICO and state law claims, individually and on behalf of the company, against various related parties, alleging financial misconduct.The United States District Court for the District of South Dakota dismissed the action without prejudice, denied leave to amend the complaint as futile, and awarded attorney fees to two defendants based on an indemnification provision in the buyout agreement. The court found the plaintiff lacked capacity to bring derivative claims because he was no longer a company member, and that his individual claims failed because his injuries were not distinct from those suffered by all shareholders. The plaintiff’s motion for reconsideration was also denied.On appeal, the United States Court of Appeals for the Eighth Circuit reviewed the dismissal de novo. The court affirmed the district court’s rulings, holding that the plaintiff lacked legal capacity to bring derivative RICO claims and failed to allege a distinct individual injury sufficient for direct RICO claims. The denial of leave to amend was upheld because the proposed amendments would not cure these deficiencies. The court also concluded it had jurisdiction to review the attorney fees award and affirmed that award, finding no reversible error in the district court’s application of the indemnification provision. View "Stewart v. Plains Commerce Bank" on Justia Law

A church organization sued its pastor after he withdrew $223,000 from a parish bank account and deposited the funds into his personal account. The pastor asserted that the money was a personal gift from a church member, who had written three $300,000 checks during a church event. One check was made payable to the church, while the other two had blank payee lines and were delivered in sealed envelopes to two pastors. The recipient pastor initially gave his check to the church president, who filled in the church’s name as payee and deposited the check in the parish account. Later, the church member allegedly told the pastor that the check was intended for him personally, prompting the pastor to transfer the funds to his own account.The Circuit Court of the First Judicial Circuit, Davison County, South Dakota, granted summary judgment in favor of the church on its claims for conversion and breach of fiduciary duty and against the pastor on his counterclaims for conversion and fraud. The court found that all money in the parish account belonged to the church or its parish and concluded that a blank check was not sufficient delivery of a gift. The court also awarded prejudgment interest to the church.The Supreme Court of the State of South Dakota reviewed the case de novo. It held that the check delivered to the pastor was not a completed gift under South Dakota law, but this finding alone did not entitle the church to summary judgment. The court determined that genuine disputes of material fact existed regarding the pastor’s fraud claim, specifically whether the church obtained the funds through misrepresentation of the donor’s intent. The Supreme Court reversed the circuit court’s grant of summary judgment on all claims and remanded for further proceedings. It also reversed the award of prejudgment interest. View "Iglesia Pentecostal V. Torres" on Justia Law

A group of student-athletes who had completed four seasons of Division I competition at member schools of the National Collegiate Athletic Association (NCAA) challenged the NCAA’s refusal to retroactively apply a new eligibility rule. The NCAA had previously permitted only four seasons of competition within a five-year period, but in June 2026 adopted a new rule allowing athletes to compete for up to five seasons in five years. The NCAA did not apply the new rule retroactively, excluding athletes who had already exhausted four seasons. Several plaintiffs, most of whom had earned money through name, image, and likeness (NIL) deals, sought to play a fifth season and argued that the NCAA’s decision unlawfully restrained trade in violation of § 1 of the Sherman Act.The United States District Court for the District of Colorado reviewed the case and granted a preliminary injunction, ordering the NCAA to allow plaintiffs a fifth season of eligibility. The court accepted the plaintiffs’ expert’s definition of the relevant labor market as encompassing all NCAA Division I athletics in the United States, finding that this market was plausibly monopsonistic and controlled by the NCAA. The court concluded that plaintiffs were likely to succeed on the merits and satisfied the other requirements for preliminary injunctive relief.On appeal, the United States Court of Appeals for the Tenth Circuit reviewed the district court’s factual findings for clear error. The appellate court held that the plaintiffs’ proposed market definition—all Division I athletics in the United States—lacked evidentiary support and was not plausible, as athletes do not view all Division I programs across sports as reasonable substitutes. The Tenth Circuit found that the district court clearly erred in accepting this market definition. Accordingly, the court reversed the district court’s order granting the preliminary injunction and vacated the injunction. View "Wisne v. NCAA" on Justia Law

A group of DirecTV subscribers, both residential and commercial, brought a class action lawsuit alleging that the National Football League (NFL) and its member teams engaged in anticompetitive conduct. The subscribers claimed that the NFL’s interlocking agreements—including pooling telecast rights, exclusive distribution through DirecTV, and arrangements with networks—suppressed competition for out-of-market NFL games. These agreements allegedly forced subscribers to pay inflated prices for the “Sunday Ticket” package, which bundled NFL games not otherwise available in their local markets.The United States District Court for the Central District of California initially allowed the case to proceed, certifying classes and admitting expert testimony by the plaintiffs’ economists. After trial, a jury found the NFL liable on antitrust grounds and awarded substantial damages to the subscribers. However, the district court later excluded the plaintiffs’ expert testimony, finding it unreliable under Federal Rule of Evidence 702, and granted judgment as a matter of law in favor of the NFL. In the alternative, the district court conditionally ordered a new trial on damages, concluding the jury’s damages calculation was not supported by the evidence and was improperly derived.The United States Court of Appeals for the Ninth Circuit reviewed the case. It held that the district court abused its discretion by excluding the plaintiffs’ expert testimony, ruling that while experts’ methods and opinions may be impeachable, such disputes are for the jury to resolve unless the methods are fundamentally unreliable or speculative. However, the appellate court agreed that a new trial on damages was warranted because the jury’s award was based on an improper calculation method. The Ninth Circuit reversed the district court’s judgment as a matter of law, affirmed the order granting a new trial on damages, remanded with instructions to reinstate the jury’s liability verdict, and directed a new trial limited to the issue of damages. View "NINTH INNING INC. V. NATIONAL FOOTBALL LEAGUE, INC." on Justia Law

Two condominium unit owners challenged actions taken by their association, a nonprofit corporation, after it recorded an amended declaration in 2020 that changed allocations of common-area interests and imposed new rental and moorage rules. The owners alleged that the association unlawfully altered their property and rental rights, failed to properly address encroachments, and breached its governing documents. They also sought to compel the association to remeasure unit square footage and reallocate ownership interests under Idaho law.The District Court of the Fourth Judicial District granted summary judgment to the association on the owners’ claims for declaratory relief, slander of title, quiet title, encroachment, and breach of contract, concluding that these were derivative claims barred by the Idaho Nonprofit Corporation Act because the owners lacked sufficient voting power. The court found these claims challenged corporate actions as ultra vires and could only be brought derivatively. The court also determined the owners' demand for remeasurement and reallocation under Idaho Code section 55-1505(1)(c) was a direct claim, but ruled against them because the association’s actions were not shown to be in bad faith.On appeal, the Supreme Court of the State of Idaho affirmed the district court’s summary judgment on the first five claims, holding that the association’s actions could only be challenged derivatively under the Nonprofit Corporation Act, and the owners lacked standing and did not meet statutory requirements. However, the Supreme Court reversed the summary judgment on the claim for remeasurement and reallocation of ownership interests, finding a genuine dispute of material fact as to whether the association acted in bad faith during the 2020 reallocation. The case was remanded for trial on that claim. No costs were awarded on appeal. View "K & L CRYSTAL BEACH, LLC v. THE CRYSTAL BEACH CONDOMINIUM ASSOCIATION" on Justia Law

Maurice Voce, a self-taught investor, traded stock options with Morgan Stanley & Co., LLC for decades, amassing a substantial fortune. His children and nephew, as co-trustees of his trusts and personal representative of his estate, alleged that Morgan Stanley and advisor John Privitelli continued facilitating risky trading and collecting commissions even as Maurice’s cognitive health declined in his later years. They claimed this conduct constituted breach of fiduciary duty and financial elder abuse. The plaintiffs also asserted that Privitelli’s advice extended to tax and estate planning, resulting in costly insurance policies and tax penalties.Previously, the plaintiffs initiated arbitration with the Financial Industry Regulatory Authority (FINRA), which dismissed their claims without prejudice, permitting them to pursue litigation. They then filed suit in the Superior Court of Los Angeles County. The trial court found the claims timely under the discovery rule but imposed a damages cutoff based on a backward projection of the remaining statute of limitations period. The court also granted defendants’ motion for nonsuit, dismissing both causes of action. It ruled there was insufficient evidence of harm for elder abuse and concluded defendants’ fiduciary duty did not cover tax and estate planning advice, as they were not formally hired or paid for such services. Additionally, it determined plaintiffs failed to provide expert testimony on excessive trading for the breach of fiduciary duty claim.The Court of Appeal of the State of California, Second Appellate District, Division Three, reviewed the case. It held that the trial court misapplied the statute of limitations by limiting damages to a narrow period, rather than considering the full course of wrongful conduct for timely claims. The appellate court found plaintiffs’ evidence sufficient to survive nonsuit on both the elder abuse claim and the breach of fiduciary duty claim, to the extent that the latter involved issues beyond excessive trading. However, it affirmed nonsuit regarding the excessive trading theory due to lack of expert evidence. The judgment was reversed in part, affirmed in part, and remanded for further proceedings. View "DeVone v. Morgan Stanley & Co. LLC" on Justia Law

Ashley Energy, an energy company in Missouri, experienced flooding at its plant and leased a boiler and water treatment trailer from Indeck Power Equipment to maintain operations. The lease required Indeck to provide a “like-new” boiler and new trailer, and Ashley to operate and maintain the equipment according to industry standards, specifically ABMA guidelines, and pay for repairs beyond ordinary wear and tear. After the boiler was returned, Indeck discovered scale and debris, attempted to clean it, and ultimately sued Ashley, alleging breach of contract and seeking over $3 million in damages. Ashley had previously sued Indeck in Missouri state court, but that case was dismissed due to a forum selection clause.The United States District Court for the Northern District of Illinois conducted a jury trial. The jury found that Indeck had performed its contractual obligations and that Ashley had breached the contract. However, the jury concluded that Indeck failed to prove it had sustained damages as a result of Ashley’s breach, finding insufficient evidence that Ashley’s actions directly caused damage beyond normal wear and tear. Indeck’s post-trial motions for a new trial and for attorneys’ and experts’ fees were denied, with the district court explaining that the verdict could be rationally explained by evidence that Indeck’s own actions or equipment contributed to any damage or that no damage beyond ordinary wear and tear occurred.On appeal, the United States Court of Appeals for the Seventh Circuit affirmed the district court’s judgment. The appellate court held that the jury’s verdict was not irreconcilably inconsistent and was supported by plausible explanations from the record, and that Indeck was not entitled to attorneys’ fees as a non-prevailing party under the lease’s provisions. View "Indeck Power Equipment Co. v Ashley Energy LLC" on Justia Law

In 2016, Venezuela’s state-owned oil company, PDVSA, initiated a bond exchange offer allowing holders of unsecured notes due in 2017 to swap them for new, secured notes due in 2020. As collateral, PDVSA pledged a controlling interest in CITGO Holding, Inc., a major U.S.-based subsidiary. About 39% of the 2017 noteholders participated. PDVSA defaulted on the 2020 notes in October 2019, raising the risk that creditors could seize the CITGO collateral. This took place during significant political upheaval in Venezuela, including disputes over the country’s legitimate government and control of PDVSA.The PDV Entities filed suit in the United States District Court for the Southern District of New York, seeking to declare the bond exchange and related agreements void and unenforceable. They argued that Venezuelan law, specifically Article 150 of the Venezuelan Constitution, required National Assembly approval for such a transaction, which was not obtained. They also asserted that resolutions from the Venezuelan National Assembly in 2016 and 2019 invalidated the transaction as acts of state. The district court initially ruled for Defendants, holding that New York law applied and that the act-of-state doctrine did not bar enforcement. On appeal, the United States Court of Appeals for the Second Circuit certified questions to the New York Court of Appeals, which held that Venezuelan law governs the validity of the notes.Upon remand, the district court concluded that the bond exchange did not violate Venezuelan law because only contracts executed by the Republic or its organs—not state-owned enterprises like PDVSA—are subject to the National Assembly approval requirement under Article 150. The district court also reaffirmed that the act-of-state doctrine did not apply due to the extraterritorial nature of the transaction. On further appeal, the United States Court of Appeals for the Second Circuit affirmed. The court held that National Assembly approval was not required, the governing documents were valid under Venezuelan law, and the act-of-state doctrine did not bar enforcement. View "leos v. MUFG" on Justia Law

The plaintiff was employed as a restaurant hostess by two corporate entities. She alleged that her supervisor engaged in sexual harassment and retaliation, resulting in her constructive discharge. She brought claims under California’s Fair Employment and Housing Act (FEHA) for gender discrimination, sexual harassment, retaliation, and failure to prevent discrimination, harassment, and retaliation. The plaintiff sought to hold the sole owner of the corporate entities personally liable, arguing he was their alter ego.A jury trial was held in the Superior Court of Los Angeles County on liability, which resulted in verdicts against the two corporate defendants and awarded the plaintiff compensatory and punitive damages. The alter ego claim against the owner was tried separately to the court. The trial court applied the common law presumption of corporate separateness, requiring the plaintiff to prove that the corporations’ distinct identities should be disregarded. The court found the plaintiff failed to meet her burden and issued judgment in favor of the owner. The plaintiff appealed, contending that FEHA should alter the presumption and favor alter ego liability.The Court of Appeal of the State of California, Second Appellate District, Division One, reviewed the legal question de novo. The court held that FEHA does not modify or abrogate the common law presumption of corporate separateness. It found no statutory language, legislative history, or case law that clearly or unequivocally indicated a legislative intent to alter the presumption. The court concluded that public policy and FEHA’s purpose do not require a contrary presumption favoring alter ego liability. The judgment for the owner was affirmed, and the parties were directed to bear their own costs on appeal. View "Villasenor v. Schneiter" on Justia Law