Justia Business Law Opinion SummariesArticles Posted in US Court of Appeals for the Eighth Circuit
Jacobson Warehouse Co., Inc. v. Schnuck Markets, Inc.
SMI, a supermarket retailer, and XPO, a logistics company, both appeal the district court's orders and judgment in a breach of contract and tort dispute arising out of the parties' business relationship.The Eighth Circuit concluded that the parties' agreement bars SMI from recovering non-direct damages from XPO; the Limitation of Liability Provision contractually limits both parties' liability to each other, but does not exonerate them, and is therefore not contrary to Missouri public policy; the Limitation of Liability Provision does not violate Missouri public policy simply because it prevents SMI from recovering its mitigation damages; there was no error in the district court's determination at summary judgment that three categories of SMI's claimed damages were consequential damages; there was no error in granting judgment as a matter of law on SMI's negligence counterclaim where SMI has not provided sufficient evidence to show that XPO breached a duty of care other than its contractual duty under the agreement; there was no error in the district court's determination that two emails SMI sought to exclude were protected by the attorney-client privilege; and there was no error in awarding statutory prejudgment interest to XPO.In regard to XPO's arguments on appeal, the court concluded that there was no error in the district court's denial of judgment as a matter of law on SMI's breach of contract counterclaim, and there was no error in the district court's determination that XPO was not entitled to attorney's fees under the agreement. View "Jacobson Warehouse Co., Inc. v. Schnuck Markets, Inc." on Justia Law
Timber Ridge Escapes, LLC v. Quality Structures of Arkansas, LLC
This appeal arose out of a construction dispute between Timber Ridge and Quality Structures. After a bench trial, the district court awarded Timber Ridge $22,500 in damages and Quality Structures an amount in excess of $5 million in damages.The Eighth Circuit affirmed, concluding that the district court did not clearly err in determining that Quality Structures substantially complied with the contractual predicates for payment for the extra excavation work. Furthermore, the district court did not clearly err in finding Quality Structures proved damages related to Timber Ridge's failure to pay for the additional excavation work. The court affirmed the district court's award of other damages to Quality Structures with one exception regarding site lighting. Finally, the court concluded that the district court did not err in awarding defendant attorneys' fees under the Missouri Prompt Payment Act. View "Timber Ridge Escapes, LLC v. Quality Structures of Arkansas, LLC" on Justia Law
Northern Bottling Co., Inc. v. PepsiCo, Inc.
The Eighth Circuit affirmed the district court's grant of summary judgment in favor of PepsiCo in an action brought by Northern, alleging that PepsiCo failed to protect Northern's interests under their exclusive bottling contracts. Applying New York common law, the court concluded that it is evident PepsiCo did not owe a duty to prevent transshipping under the express terms of the bottling contracts, and thus Northern's breach claim fails as a matter of law. The court also concluded that Northern cannot rely on an implied duty to create obligations that are not expressly included in the bottling contracts, and that duty cannot provide a basis for Northern's breach of contract claim.Furthermore, because the bottling agreement is unambiguous and fails to confer a contractual duty on PepsiCo to prevent transshipping, and given Northern's inability to establish that PepsiCo owed a duty to prevent transshipment of products into Northern's territories, there is no genuine dispute of material fact and Northern's breach of contract claim was properly disposed of on summary judgment. Finally, the court agreed with the district court that no genuine dispute of material fact exists as to Northern's tortious interference claim. View "Northern Bottling Co., Inc. v. PepsiCo, Inc." on Justia Law
White Communications, LLC v. Synergies3 Tec Services, LLC
After he sent a sexually explicit text message to a customer, the other members of Synergies expelled Jeffery White as a member of the company. White and White Communications filed suit against Synergies, claiming that the expulsion was a breach of the assumption agreement and the operating agreement between the parties. At trial, the jury found in favor of White Communications on its breach of implied contract claim, but found in favor of Synergies on all other claims.The Eighth Circuit affirmed the district court's denial of White's motion for judgment as a matter of law because the jury had a legally-sufficient basis to find that Synergies terminated him for cause. In this case, it was within the purview of the jury to determine whether White's actions led to instant or deferred irreparable harm to Synergies' reputation or its economic interests. The court also concluded that the district court did not abuse its discretion in permitting prior bad acts evidence of defendant's previously-sent texts of the same nature. Furthermore, there was no abuse of discretion in permitting alleged hearsay evidence to show its impact on the listener. The court further concluded that the district court did not err by denying White's motion for a new trial where there is more than sufficient evidence to support the finding in favor of Synergies on the breach of contract claim. Finally, the court upheld the jury's award of damages on plaintiff's breach of implied contract claim. View "White Communications, LLC v. Synergies3 Tec Services, LLC" on Justia Law
Daredevil, Inc. v. ZTE Corp.
Daredevil filed suit against ZTE for breach of contract, fraud, and unjust enrichment. After the case went to arbitration in Florida, Daredevil sought to add ZTE Corp., the parent company of ZTE USA, to its arbitration claims. The arbitrator rejected the request to add ZTE Corp., ruling that Daredevil's claims against ZTE Corp. were outside the scope of arbitration. Daredevil then filed this suit against ZTE Corp., alleging breach of contract, fraud, unjust enrichment, and tortious interference with contract. The arbitrator ultimately denied each of Daredevil's claims against ZTE USA. The arbitration award was confirmed by the United States District Court for the Middle District of Florida and affirmed by the Eleventh Circuit Court of Appeals. Daredevil subsequently reopened this case in the Eastern District of Missouri against ZTE Corp.The Eighth Circuit affirmed the district court's decision to apply Florida law, holding that Daredevil's claims met the requirements for claim preclusion and were therefore barred. The court explained that Daredevil's current and previous claims share identity of the parties and identity of the cause of action, and Daredevil does not dispute that Florida's other two requirements are satisfied. In this case, privity exists between ZTE Corp. and ZTE USA where ZTE Corp. and ZTE USA are parent and subsidiary. Furthermore, Daredevil's current claims are so closely related to its arbitration claims and thus the identity-of-cause-of-action requirement has been met. Accordingly, Daredevil's claims against ZTE Corp. are barred by the decision in its prior arbitration against ZTE USA. View "Daredevil, Inc. v. ZTE Corp." on Justia Law
Sherr v. HealthEast Care System
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
Shepard v. Employers Mutual Casualty Co.
The Eighth Circuit affirmed the district court's dismissal of a complaint brought by plaintiff against Employers Mutual and Defendant Kelley, asserting a claim for breach of fiduciary duty. Plaintiff was a minority shareholder of EMC, a spin-off from Employers Mutual. Defendant Kelley was the CEO and director of both EMCI and Employers Mutual. Plaintiff alleges that Employers Mutual structured EMCI as a shell company, preventing it from becoming a valuable company or acting independently from Employers Mutual. Plaintiff alleged in the complaint that, in the years leading up to the squeeze-out merger initiated by Employers to purchase EMCI's remaining shares, defendants breached fiduciary duties owed to him as a minority shareholder of EMCI.The court concluded that plaintiff's claim did not arise in the context of a contractual relationship; his alleged injury arose only from his status as a shareholder of EMCI; and this was insufficient under Iowa law to plausibly plead a special duty arising out of a contractual relationship. Furthermore, plaintiff did not adequately plead that his injury arose from a special duty. The court also concluded that plaintiff did not allege that his voting rights were ever affected by Employers Mutual and Kelley's alleged mismanagement. Even if this were Iowa law, plaintiff would not meet this exception.Accordingly, because plaintiff's claim is derivative in nature, he must satisfy federal and Iowa requirements for a filing a derivative action, which he has failed to do so. In this case, the complaint did not state with particularity plaintiff's efforts to enforce minority shareholder rights in the years leading up to the squeeze out. Furthermore, the complaint did not allege that he petitioned the directors or other shareholders in writing, or that 90 days have expired since delivery of the demand and EMCI rejected his request, or irreparable injury would result by waiting for the expiration of the ninety days. View "Shepard v. Employers Mutual Casualty Co." on Justia Law
Dunne v. Resource Converting, LLC
After plaintiff purchased licenses for RCI non-thermal, pulverizing, and drying system technology (PAD), he alleged that the capabilities of the PAD System were misrepresented to him. Two federal law suits were filed, one in Iowa and one in Missouri.In this consolidated appeal, the Eighth Circuit affirmed the Iowa judgment, rejecting RCI's argument that it is entitled to judgment as a matter of law because the jury awarded no compensatory damages. The court concluded that punitive damages were recoverable under Iowa law because the jury necessarily found that plaintiff suffered actual damages when it found fraudulent misrepresentation. Furthermore, the jury could award punitive damages without an award of compensatory damages, and the punitive award was not unconstitutionally excessive. The court also concluded that plaintiff is not entitled to equitable relief and the district court neither erred or abused its discretion as to plaintiff's equitable counterclaims. Finally, the court found that the method used and reasons given by the district court for the reduction in costs were well within its discretion, and the district court did not abuse its discretion in awarding attorney fees.The court remanded the Missouri judgment for further proceedings, concluding that the district court erred by applying federal law, rather than Iowa law, to determine whether plaintiff's claim was precluded. The district court also erred by determining that Missouri law on the economic loss doctrine would bar plaintiff's misrepresentation claims. The court also noted that plaintiff's conspiracy claim should be reinstated and the district court's attorneys' fee award to Resource as the prevailing party is set aside. View "Dunne v. Resource Converting, LLC" on Justia Law
Azarax, Inc. v. Syverson
Azarax filed suit against defendant and his law firm, alleging legal malpractice and breach of fiduciary duty. Azarax claimed that defendant and his firm were negligent in their representation of Convey Mexico and that Azarax had claims against defendant and his firm as a successor by merger to Convey Mexico.The Eighth Circuit affirmed the district court's dismissal of the complaint and agreed with the district court that Azarax was not a valid successor in interest to Convey Mexico. In this case, the summary judgment record established that the shareholders of Convey Mexico did not unanimously provide written consent for the merger with Azarax Holding, so the merger was not valid. Therefore, Azarax lacked standing to sue defendant and his law firm. The court modified the judgment to dismiss the complaint without prejudice. View "Azarax, Inc. v. Syverson" on Justia Law
Farmers Edge Inc. v. Farmobile, LLC
FEI, Crop Venture's successor-in-interest, filed suit alleging that the individual defendants took proprietary information they developed at Crop Ventures after they left the company and co-founded Farmobile (the corporate defendant). Specifically, FEI alleges that the individual defendants' behavior constituted a breach of explicit or implicit contracts with the company; defendants were obligated to assign to their employer the ownership rights of products they worked to develop; the individual defendants breached their duty of loyalty to their employer; and the individual defendants misappropriated trade secrets. The district court denied in full FEI's motion, and granted in part and denied in part Farmobile's motion.The Eighth Circuit affirmed and held that because no contract bound the parties during Defendant Nuss' term of employment, Nuss was not in breach of an explicit contract; FEI has not shown that any of the individual defendants was similarly "specifically directed" during their product-development process, so no implied contracts were created under the hired-to-invent doctrine; FEI failed to show the individual defendants breached their duty of loyalty to their employer; FEI cannot maintain a trade secret claim under the Nebraska Trade Secrets Act (NTSA) or the federal Defend Trade Secrets Act (DTSA); and the remaining claims are unpersuasive. View "Farmers Edge Inc. v. Farmobile, LLC" on Justia Law