Justia Business Law Opinion Summaries

Bruce, Phillip, and Judith are siblings and co-equal general partners of the Guttman Family Limited Partnership, which owns Los Angeles County real estate. Bruce sued to dissolve the partnership, Corporations Code 15908.02(a). Phillip and Judith initiated a statutory procedure to buy out Bruce’s interest in the partnership. Court-appointed appraisers submitted valuations of the partnership’s properties. One appraiser concluded that the value of the partnership properties was $37,180,000, another appraiser established the value at $38,300,000, and the third at $39,037,000. The court agreed with Bruce that the buyout procedure did not require a consensus among the appraisers, or among two of them.Bruce, believing the appraisals undervalued the properties, dismissed his complaint without prejudice. The court then granted Phillip and Judith’s motion to vacate the dismissal. The court of appeal dismissed Bruce’s petition for review. In addition to the commencement of trial limitation on a plaintiff’s right to dismiss, a plaintiff may not dismiss an action when a defendant seeks affirmative relief in the case. Because Phillip and Judith were pursuing the affirmative relief available under the buyout provision at the time Bruce filed his request to dismiss the action, the entry of dismissal was improper. View "Guttman v. Guttman" on Justia Law

The Supreme Court affirmed in part and reversed in part the special master's determination in the district court that resolved a dispute between PF2 Leasing, LLC and Jim Galipeau, the receiver for Black Gold Enterprises, LLC, holding that the special master exceeded the scope of his authority when he granted Galipeau immunity for actions Galipeau took regarding PF2's personal property.Specifically, the Supreme Court held that the special master (1) correctly concluded that a court-appointed receiver is protected by judicial immunity from liability; (2) properly determined that it was not necessary for Galipeau to require a release or indemnification agreement to return PF2's personal property; but (3) exceeded the scope of his authority in further granting Galipeau immunity for the actions Galipeau took regarding PF2's personal property. View "PF2 Leasing, LLC v. Galipeau" on Justia Law

Blizzard invested in a tire pyrolysis project in Kansas and subsequently sued Schaefers. A Kansas jury returned a $3.825 million fraud judgment, which was entered in California. The California court added a judgment debtor (BKS) pursuant to the “outside reverse veil piercing” doctrine, which arises when the request for piercing comes from a third party outside the targeted business entity. The targeted entity was BKS. Schaefers owns a 50 percent interest in that LLC. Schaefers’ wife, Karin, owns the other 50 percent. Neither Karin nor BKS was a defendant in the Kansas action. The California court found that BKS is Schaefers’ alter ego.The court of appeal affirmed in part. The evidence is sufficient to support the finding that BKS is Schaefers’ alter ego. The court remanded for further proceedings so that the trial court may weigh competing equities that bear on the veil-piercing issue. Blizzard is entitled to recover the damages awarded by the Kansas judgment, but Karin may be an innocent third party who would suffer substantial harm if recovery is accomplished through the reverse veil piercing; there is no indication that she was involved in the fraud committed by Schaefers. Karin may not be responsible for debts incurred by Schaefers after their separation in 1996. View "Blizzard Energy, Inc. v. Schaefers" on Justia Law

Eric Christiansen filed a nine-count complaint against respondents, Michael Moser and Potlatch #1 Financial Credit Union (“P1FCU”), following a decision by the Lewiston Roundup Association (“LRA”) to discontinue contracting with Christiansen to produce motorsport events at the LRA’s facility. The complaint alleged that Moser, a P1FCU employee and LRA member, improperly accessed information from Christiansen’s P1FCU account and shared it with the LRA so that it could recreate his business model and produce motorsport events without him. The district court granted summary judgment in the Respondents’ favor on each of Christiansen’s claims. Christiansen appealed, arguing that the district court erred in granting summary judgment because it failed to rule on Christiansen’s motion to compel discovery, failed to grant Christiansen more time to complete discovery, and failed to conclude that genuine issues of material fact precluded dismissal of four of Christiansen’s claims. The Idaho Supreme Court concluded after review that the district court abused its discretion by failing to decide Christiansen’s motion to compel discovery before considering the Respondents’ motions for summary judgment. Accordingly, judgment was reversed and the matter remanded for further proceedings. View "Christiansen v. Potlatch #1 FCU" on Justia Law

This appeal presented an issue of first impression for the Court of Appeals: does a commercial property insurance policy provide coverage for a business’s lost income due to the COVID-19 pandemic? After review of the specific insurance policy that California Mutual Insurance Company (California Mutual) issued to The Inns by the Sea (Inns) for its five lodging facilities, the Court determined Inns could not recover from California Mutual for its lost business income resulting from the COVID-19 pandemic. Further, Inns did not identify any manner in which it could amend its complaint to state a claim for coverage. Accordingly, the Court affirmed the trial court’s order sustaining California Mutual’s demurrer without leave to amend. View "The Inns by the Sea v. Cal. Mutual Ins. Co." on Justia Law

The appellants were two of a group of plaintiffs who sued eBay and PayPal, challenging provisions in their respective user agreements. Plaintiffs’ second amended complaint alleged 23 causes of action, 13 against eBay, seven against PayPal, and three against both defendants. The trial court dismissed, without leave to amend, 20 of the causes of action, including 14 claims against eBay. Three causes of action proceeded: breach of contract against both defendants and violation of the covenant of good faith and fair dealing against eBay. More than three years later, the appellants opted out of the case against eBay, and voluntarily dismissed the two claims against it. Judgment of dismissal was entered against them.The appellants appealed, contending the trial court got it wrong as to 11 of the dismissed causes of action. The court of appeal affirmed, noting that this was the third appeal of the case. The trial court properly dismissed the claims and did not abuse its discretion in doing so without leave to amend. All of the alleged causes of action failed to state a claim. The court stated that “counsel for appellants has apparently been urging the same contentions for some nine years, all without success. This is enough.” View "George v. eBay, Inc." on Justia Law

One beverage distributorship sued another and ultimately narrowed its lawsuit to a single tort claim for intentional interference with prospective economic advantage premised solely on the theory that the defendant had engaged in independently wrongful conduct by breaching a nondisclosure and non-circumvention agreement. This is an invalid theory as a matter of law under California Supreme Court precedent; an actor’s breach of contract, without more, is not “wrongful conduct” capable of supporting a tort, including the tort of intentional interference with prospective economic advantage. No one caught the error until the jury returned a special verdict in the plaintiff’s favor that was premised solely on the breach of the agreement.The court of appeal reversed. A jury’s special verdict for the plaintiff, based on conduct that does not constitute an actionable tort, cannot stand. Just as a trial court lacks subject matter jurisdiction to enter judgment for conduct that does not violate a criminal or civil statute, a trial court also lacks subject matter jurisdiction to enter judgment for allegedly tortious conduct, fashioned by common law, that the state’s highest court has determined is not tortious. A party’s conduct cannot confer subject matter jurisdiction upon a court, so the defendant’s delay in objecting is irrelevant. View "Drink Tank Ventures LLC v. Real Soda in Real Bottles, Ltd." on Justia Law

Prevent, a group of European companies that specializes in turning around distressed automotive parts suppliers, organized an effort to halt supplies of their parts to obtain better terms from Volkswagen, based in Germany. Volkswagen responded by not doing business with the affiliated companies. Begun in 2016, this litigation initially involved claims of unfair business practices and anticompetitive behavior under German and European law and was handled by German courts. Volkswagen prevailed in most of the suits.In 2019 two members of Prevent, Eastern, based in the Netherlands, and Prevent's American subsidiary sued Volkswagen and its American subsidiary in Michigan, alleging that the carmaker unfairly prevented them from acquiring distressed automotive-parts manufacturers. The district court dismissed the complaint, citing forum non conveniens. The Sixth Circuit affirmed. Germany is an adequate forum to hear this case. It appears that a Germany-based antitrust lawsuit would reach more conduct and more injuries than an American suit. German and Portuguese are the languages of the relevant documents. Local interest in the dispute, the location of the injury, the fullness of the court’s docket, preference for trying cases in the place of the governing law, hesitance to apply foreign law, and desire to avoid conflict-of-law problems, predict an American court’s potential “administrative and legal problems” with trying the case. View "Prevent USA Corp. v. Volkswagen AG" on Justia Law

To combat the spread of COVID-19, the Ohio government ordered child-care programs to shut down for around two months beginning in March 2020. As a result, Dakota Girls and the other plaintiffs could not use their facilities for their intended purpose—as private preschools. They sued their insurer, the Philadelphia Indemnity, citing policy provisions concerning business and personal property, business income, civil-authority orders, and (communicable disease and water-borne pathogens. The suit sought damages for breach of contract and the insurer’s alleged bad faith.The Sixth Circuit affirmed the dismissal of the suit, citing the plain language of the policies. A loss of use is not the same as a physical loss. Reading the communicable-disease coverage to not require an actual illness at the premises, therefore, would engender serious inconsistency within the policy. The court declined to consider the policy’s “virus exception.” Dakota Girls has never shown that it had coverage, much less that Philadelphia’s agents knew it had coverage or that coverage was so obvious it could not have been reasonably denied. View "Dakota Girls, LLC v. Philadelphia Indemnity Insurance Co." on Justia Law

Plaintiffs alleged that they own an apartment complex and that their tenant purchased a washing machine from Best Buy, which was negligently installed. A resulting water leak resulted in significant damage to the property, rendering several units uninhabitable.Best Buy argued that its subsidiary had a contract with Penn Ridge, under which Penn Ridge “shall provide services . . . as a duly licensed broker of property by the U.S. Federal Motor Carrier Safety Administration … utilizing the services of independent motor carriers to effectuate the pick-up, delivery, and in-home installation of Merchandise” from Best Buy. Carriers are defined under the Agreement as “any independently owned and operated motor carrier under contract with [Penn Ridge] who may also provide Installation Services.” The carriers’ trucks did not display the Best Buy name or logo. Delivery teams did not wear any Best Buy branded clothing. The equipment used by the delivery teams varied among carriers. Penn Ridge alone determined if the carriers were qualified to provide necessary delivery and installation services. The contracts stated the carriers were providing services as independent contractors, Best Buy gave Penn Ridge access to its routing system and required that contractors comply with certain Best Buy policies and procedures.The court of appeal affirmed summary judgment in favor of Best Buy. There is no material dispute that the washing machine was installed by an independent contractor. View "Bacoka v. Best Buy Stores, L.P." on Justia Law