Justia Business Law Opinion Summaries

This case centered on a contract dispute between Clean Energy Collective LLC (CEC) and two defendants, Borrego Solar Systems, Inc. (Borrego) and 1115 Solar Development, LLC (1115 Solar). CEC was a Colorado limited liability company; Borrego was a California corporation headquartered in San Diego, and 1115 Solar was a Delaware limited liability company with its principal place of business in California. Borrego was 1115 Solar’s parent company and owned the latter in its entirety. CEC’s claims against Borrego and 1115 Solar arose from an asset purchase agreement (“APA”) to construct several solar photovoltaic projects. The APA specified that CEC would pay defendants to construct three power-generation projects in Massachusetts and allowed for additional projects pursuant to separate contracts governed by the APA’s terms. After the parties were unable to resolve disagreements regarding pricing and payments for projects subject to the APA (all of which were to be completed outside Colorado) CEC sued the defendants in Colorado, asserting claims for breach of contract and breach of warranty. The issue presented for the Supreme Court's review was whether the trial court erred in concluding Borrego was subject to general personal jurisdiction in Colorado. Because the trial court did not assess whether Borrego was essentially at home in Colorado, the Court concluded it did not fully apply the test announced in "Magill v. Ford Motor Co.," (379 P.3d 1033), and therefore erred in exercising general personal jurisdiction over Borrego. Applying the complete test itself, the Court concluded Borrego was not subject to general jurisdiction in Colorado. View "In re Clean Energy Collective LLC v. Borrego Solar Sys., Inc." on Justia Law

This case concerned the relative priority of competing charging orders filed by 15 multiple judgment creditors against a foreign judgment debtor’s membership interests 16 in several Colorado limited liability companies. In July 2013, Chase Bank obtained an Arizona judgment of over $20 million against several defendants, including Reginald Fowler, an Arizona resident. As part of its postjudgment collection efforts, Chase obtained Arizona orders charging Fowler’s membership interests in three Colorado limited liability companies. In March 2014, respondents Douglas McClure, Nancy McClure, and Spiral Broadcasting, L.L.C. (collectively, “the McClures”), obtained a stipulated judgment for $1.5 million against Fowler, among others, in the Arizona Superior Court. In April 2014, the McClures domesticated their Arizona judgment in Colorado, and between May and July 2014, they obtained and served Colorado orders charging Fowler’s membership interests in the LLCs. Now confronted with facially competing charging orders, the LLCs paid Fowler’s then-due distributions into the Colorado District Court registry. That same day, the McClures moved for release of the distribution funds to them, and several days later, Chase sought and obtained leave to intervene and opposed the McClures’ motion. The district court ultimately ordered the distribution funds released to the McClures. Chase then domesticated its Arizona charging orders with a different Colorado District Court, and moved for reconsideration of the release order, arguing that its newly-domesticated charging orders should be deemed effective as of the date they were issued in Arizona and entitled to priority over the McClures’ charging orders. The Colorado Supreme Court concluded first that for purposes of determining the enforceability of a charging order, a membership interest of a non-Colorado citizen in a Colorado limited liability company is located in Colorado. We further conclude that when, as here, a judgment creditor obtains a foreign charging order that compels certain action by a Colorado limited liability company, the charging order is ineffective as against the limited liability company until the creditor has taken sufficient steps to obligate the company to comply with that order. Although the authorities are not uniform as to the steps to be taken, under any of the applicable scenarios, the charging orders obtained by Chase did not become effective until after the respondents had obtained and served competing charging orders. The Court thus concluded that the McClures’ charging orders were entitled to priority over Chase’s competing charging orders. View "JPMorgan Chase Bank N.A. v. McClure" on Justia Law

Plaintiff Jessica Ferrer and her companion, Kathryn Winslow, were injured when a taxicab driven by Tesfamariam Okbamicael struck them as they crossed a street in Denver. Okbamicael worked for Colorado Cab Company (“Yellow Cab”), which owned the taxicab. Ferrer brought this suit against Okbamicael and Yellow Cab (collectively, “Defendants”), alleging that Okbamicael was negligent and that Yellow Cab was vicariously liable for his negligence under the doctrine of respondeat superior. Ferrer also alleged that Yellow Cab was liable for her injuries suffered in the collision under theories of direct negligence (negligence as a common carrier) and negligent entrustment, hiring, supervision, and training. In an amended answer to the complaint, Yellow Cab admitted that Okbamicael was an employee acting within the course and scope of his employment with Yellow Cab at the time of the accident. Defendants then moved for partial judgment on the pleadings, seeking to dismiss Ferrer’s direct negligence claims against Yellow Cab. The trial court granted Defendants’ motion, applying the rule from “McHaffie v. Bunch,” (891 S.W.2d 822 (Mo. 1995)), that an employer’s admission of vicarious liability for an employee’s negligence bars a plaintiff’s direct negligence claims against the employer. Agreeing with the trial court’s application of the “McHaffie” rule, the Supreme Court affirmed. View "In re Ferrer" on Justia Law

This case started out of a business dispute between respondent-cross-petitioner Just In Case Business Lighthouse, LLC (JIC) and petitioner-cross-respondent Patrick Murray. To prepare for the litigation, JIC hired Preston Sumner, a businessman with knowledge of business sales and valuation, as an advisor. Sumner agreed to help with the case in exchange for a ten-percent interest in the case's outcome. Murray objected to Sumner's involvement in the case, arguing: (1) Sumner's interest in the case outcome was an improper payment violating Colorado Rule of Professional Conduce (RPC) 3.4(b); (2) Sumner lacked the requisite personal knowledge of the case's underlying events as required by Colorado Rule of Evidence (CRE) 602; and (3) the summary charts Sumner prepared were inadmissible under CRE 1006. The trial court ruled that Sumner could testify as a summary witness, but not as an expert or fact witness. Sumner testified and laid foundation for two of the summary exhibits, which the trial court admitted into evidence. The jury returned a verdict in favor of JIC. Murray renewed his arguments on appeal, and the Court of Appeals rejected them in part, and remanded for the trial court to determine whether Sumner's testimony should have been excluded as a sanction for JIC's violation of RPC 3.4(b). After review, the Colorado Supreme Court held that violation of the ethical rule did not displace the rules of evidence, and that trial courts retained discretion under CRE 403 to exclude testimony of improperly compensated witnesses. The trial court here did not abuse its discretion in declining to exclude Sumner's testimony. Further, the Court held that trial courts could allow summary witness testimony if they determine that the evidence was sufficiently complex and voluminous that the witness would assist the trier of fact. The Court held that the trial court did not abuse its discretion with respect to the summaries. Finding no reversible errors with the trial court's judgment, the Supreme Court reversed the appellate court's judgment remanding the case for consideration of whether Sumner's testimony should have been excluded. View "Murray v. Just In Case Bus. Lighthouse, LLC" on Justia Law

Petitioner John Van Rees, Sr. contracted with respondent Unleaded Software, Inc. to perform web-related services and to design additional websites. After Unleaded missed deadlines and failed to deliver the promised services, Van Rees sued, asserting multiple tort claims, a civil theft claim, three breach of contract claims, and a claim for violations of the Colorado Consumer Protection Act (CCPA). The trial court granted Unleaded's 12(b)(5) motion, dismissing all but Van Rees' contract claims, on which a jury found in Van Rees' favor. Van Rees appealed, and the court of appeals affirmed. After its review, the Colorado Supreme Court affirmed in part and reversed in part. The appellate court had determined that the tort and civil theft claims were barred by the "economic loss rule" because they were related to promises memorialized in the contracts, and the CCPA claim failed to allege a significant public impact. The Supreme Court found the issue pertaining to the economic loss rule was not whether the tort claims related to a contract, but whether they stemmed from a duty independent of the contact. The Court found pre-contractural misrepresentations in this case distinct from the contract itself, and could have formed the basis of an independent tort claim. Accordingly, the Court reversed as to Van Rees' tort claims. With respect to civil theft, the court affirmed the court of appeals on the ground that the claim failed to adequately allege the "knowing deprivation of a thing of value." View "Van Rees v. Unleaded Software, Inc." on Justia Law

Petitioners Scot Hutchins and John Casper petitioned for review of a court of appeals’ judgment affirming the district court’s ruling in favor of La Plata Mountain Resources, Inc. (La Plata) in an action brought by La Plata to collect on certain debentures issued by Leadville Mining and foreclose on a deed of trust securing the debts. Although Leadville’s authorized agent had signed documents acknowledging its obligations for the amounts owed on other similar debentures held by Hutchins and Gasper, the applicable statute of limitations had run on any action by Hutchins and Gasper to collect on the debts or foreclose on the deed of trust, leaving La Plata as the sole secured creditor. Because the documents in question were in writing, were signed by Leadville, and contained a clear and unqualified acknowledgement of the debt owed to Hutchins and Gasper, the Supreme Court concluded they constituted a new promise to pay, establishing a new accrual date and effectively extending the limitations period on collection of the debt, according to the statutes and case law of this jurisdiction, whether or not the documents in question also successfully modified the terms of the debentures. The judgment of the court of appeals in this case was reversed and the matter remanded for further proceedings. View "Hutchins v. La Plata MountaIn re ., Inc." on Justia Law

Just in Case Business Lighthouse (JIC) , owned and operated by Joseph Mahoney, entered into an agreement with Pearl Development Company, whereby Pearl agreed to pay JIC a specified commission if it found a buyer for Pearl. Without JIC's knowledge, Pearl's agents, including its president, Patrick Murray, signed a letter of intent to sell Pearl with Epic Energy Resources, Inc. Before the sale was completed, Murray contacted Mahoney and convinced him to sign a termination agreement, ending their previous business arrangement. Five months later, Epic bought Pearl. Upon learning of the sale, JIC sued Pearl's officers and owners (including Murray) alleging they fraudulently misrepresented their intentions and failed to disclose that Epic was planning to purchase Pearl. The misrepresentation was used to induce Mahoney to sign the termination agreement and deprive him of his commission. In its preparation for trial, JIC hired businessman Preston Sumner as an advisor, and granted him a ten-percent interest in the case contingent on the outcome. Sumner did a variety of work related to the suit. JIC disclosed Sumner as a witness and indicated that it intended to use Sumner as an expert in the case. Murray moved to preclude Sumner from testifying, arguing that RPC 3.4(b) prohibiting compensating witnesses on a contingency fee basis. The trial court granted the motion in part and denied in part, finding that RPC 3.4(b) only prohibited Sumner from testifying as a non-expert witness. The court allowed him to testify as a law witness. Sumner testified; the jury returned its verdict in favor of JIC. Murray appealed, renewing arguments he made at the trial court challenging Sumner's testimony. The Supreme Court reversed the court of appeals' judgment to the extent that it remanded the case back to the trial court to determine whether Sumner's testimony should have been excluded. The Court affirmed the trial court in all other respects. View "Murray v. Just In Case Bus. Lighthouse, LLC" on Justia Law

Petitioner Branch Banking and Trust Company (BB&T) petitioned the Colorado Supreme Court for review of whether a deed of trust securing a promissory note was a negotiable instrument under Colorado's Uniform Commercial Code (UCC). The court of appeals held that deeds of trust were not negotiable instruments within the meaning of Article 3 of the UCC, therefore BB&T was not a holder in due course with respect to the deed at issue here. The Supreme Court affirmed, but on different grounds: in this case, the deed and other documents were forged. "[E]ven assuming a deed of trust qualifies as a negotiable instrument, holder-in-due-course status does not preclude a purported maker from asserting a forgery defense." Here, the purported maker possessed a valid forgery defense, his negligence didn't contribute to the forgery, and he did not ratify the forged documents. As such, the Court did not reach the issue of negotiability under Article 3 of the UCC. View "Liberty Mortg. Corp. v. Fiscus" on Justia Law

Harman-Bergstedt, Inc. appealed the appellate court's decision to reverse an Industrial Claim Appeals Office decision disallowing respondent Elaine Loofbourrow's award of temporary disability benefits. The ICAO concluded that once respondent's treating physician placed her at maximum medical improvement, temporary total disability benefits could not be awarded for the injury for which she was initially treated. The appellate court concluded that under the circumstances of this case, such an independent medical exam was not a prerequisite to temporary total disability benefits. After its review of this case, the Supreme Court concluded the appellate court was correct in its decision: because a determination of maximum medical improvement has no statutory significance with regard to injuries resulting in loss of no more than three days (or shifts) of work time, respondent's award of temporary total disability benefits was not barred by her failure to first seek a division-sponsored independent medical examination. View "Harman-Bergstedt, Inc. v. Loofbourrow" on Justia Law

The Supreme Court affirmed the court of appeals’ ruling in favor of the Colorado Department of Local Affairs’ interpretation of CRS 39-4-102. The Court held that Qwest Corporation as a public utility, is valued centrally and therefore was not entitled to the intangible property exemption or the cost cap valuation method found elsewhere in Colorado’s tax statutes. The Court also held that this valuation method did not violate Qwest’s constitutional guarantee under the Equal Protection Clause nor did it violate Qwest’s rights under the Uniform Taxation Clause of the Colorado Constitution. View "Qwest v. Colorado Division of Property Taxation" on Justia Law