Justia Business Law Opinion Summaries

Hetronic International, Inc., a U.S. company, manufactured radio remote controls, the kind used to remotely operate heavy-duty construction equipment. Defendants, none of whom were U.S. citizens, distributed Hetronic’s products, mostly in Europe. After about a ten-year relationship, one of Defendants’ employees stumbled across an old research-and-development agreement between the parties. Embracing a “creative legal interpretation” of the agreement endorsed by Defendants’ lawyers, Defendants concluded that they owned the rights to Hetronic’s trademarks and other intellectual property. Defendants then began manufacturing their own products—identical to Hetronic’s—and selling them under the Hetronic brand, mostly in Europe. Hetronic terminated the parties’ distribution agreements, but that didn’t stop Defendants from making tens of millions of dollars selling their copycat products. Hetronic asserted numerous claims against Defendants, but the issue presented on appeal to the Tenth Circuit centered on its trademark claims under the Lanham Act. A jury awarded Hetronic over $100 million in damages, most of which related to Defendants’ trademark infringement. Then on Hetronic’s motion, the district court entered a worldwide injunction barring Defendants from selling their infringing products. Defendants ignored the injunction. In the district court and before the Tenth Circuit, Defendants focused on one defense in particular: Though they accepted that the Lanham Act could sometimes apply extraterritorially, they insisted the Act’s reach didn’t extend to their conduct, which generally involved foreign defendants making sales to foreign consumers. Reviewing this matter as one of first impression in the Tenth Circuit, and after considering the Supreme Court’s lone decision on the issue and persuasive authority from other circuits, the Tenth Circuit concluded the district court properly applied the Lanham Act to Defendants’ conduct. But the Court narrowed the district court’s expansive injunction. Affirming in part, and reversing in part, the Court remanded the case for further consideration. View "Hetronic International v. Hetronic Germany GmbH, et al." on Justia Law

The Supreme Court vacated the trial court's order granting a temporary injunction enjoining Defendants from enforcing against only the individual Plaintiffs multiple specifically enumerated executive orders, administrative regulations, and directives, holding that the trial court erred.Plaintiffs, several businesses, filed suit against the Governor, the Secretary of the Cabinet for Health and Family Services, and the Commissioner of the Kentucky Department of Public Health, seeking declaratory relief, a temporary injunctions and a permanent injunction regarding the Governor's orders related to COVID-19. The circuit court granted temporary injunctive relief. The Supreme Court vacated the order, holding that the trial court erred by refusing to allow the Governor to call witnesses and present evidence. View "Beshear v. Goodwood Brewing Co." on Justia Law

In 2012, LaTele, a Venezuelan television corporation, acting through its president, Fraiz, sued the American television network Telemundo, claiming that Telemundo infringed LaTele’s copyrighted telenovela. While the lawsuit was pending in Miami, a Venezuelan criminal court appointed a governmental board, “La Junta” to displace Fraiz and manage the affairs of LaTele. Fraiz asked the district court to determine that he was the proper representative of LaTele and that La Junta should be excluded from participating in the lawsuit. In 2018, the district court lifted its stay, removed Fraiz’s attorneys from participation in the case, and affirmed that La Junta’s attorney was counsel of record.The Eleventh Circuit dismissed an appeal after holding that it had jurisdiction to entertain the matter. Under the collateral order doctrine, the district court’s order can be treated as final for purposes of appeal. The order conclusively determined an important issue that was completely separate from the merits of the copyright claim, and would otherwise be unreviewable on appeal from a final judgment. However, La Junta and Telemundo challenged Fraiz’s standing to bring the appeal on behalf of LaTele. The district court correctly determined, based on its review of four foreign court orders, that La Junta has the lawful authority to manage the affairs of LaTele and this lawsuit. View "Latele Television, C.A. v. Telemundo Communications Group, LLC" on Justia Law

After plaintiff was run over by a barrel-racing horse at a Texas rodeo, she filed suit against Kosse Roping Club, the rodeo operator, for negligence. Ten months later, plaintiff filed suit against the club's directors.The Fifth Circuit affirmed the district court's dismissal of plaintiff's claims against the directors as untimely. The court need not decide the validity of plaintiff's tolling theory because it concluded that, under Texas law, plaintiff could not pierce the club's corporate veil based solely on evidence that the club was undercapitalized. Therefore, plaintiff's veil-piercing theory failed and, along with it, any argument that the limitations clock against the directors was tolled by her suing Kosse. View "Ledford v. Keen" on Justia Law

The Court of Chancery granted in part an anti-suit injunction sought by a buyer and a parent corporation with whom the buyer contracted to acquire a wholly owned subsidiary (the Company) to bar the seller and its subsidiary from pursuing their claims in a Texas lawsuit, holding that the forum selection provision in the stock purchase agreement applied.Under the stock purchase agreement, the buyer contracted with a Company and caused the Company to enter into a supply agreement with a wholly owned subsidiary of the seller. The stock purchase agreement contained a forum selection provision. The seller signed the stock purchase agreement and did not sign the supply agreement. The seller's subsidiary signed the supply agreement but did not sign the stock purchase agreement. The seller and its subsidiary later filed a lawsuit in Texas state court seeking rescission of the supply agreement. The buyer and the Company then brought this action asking the court to apply the forum selection provision in the stock purchase agreement to the claims implicating the supply agreement. The Court of Chancery granted the request for an anti-suit injunction against the seller and against a non-signatory signatory, holding that an injunction was warranted. View "Florida Chemical Company, LLC v. Flotek Industries, Inc." on Justia Law

On a Monday, Medicredit, a debt collection agency, received a letter from a consumer, plaintiff-appellee Elizabeth Lupia, demanding that it cease calling her about an unpaid medical debt. The next day, before Medicredit processed the letter, it called Ms. Lupia again about the debt. This call served as grounds for Ms. Lupia's suit under the Fair Debt Collection Practices Act (FDCPA). According to Medicredit, its Tuesday call was a bona fide error, thereby shielding the agency from liability. Lupia argued Medicredit’s policy allowed for more time than that: permitting up to three business days of lag time between its receipt and processing of mail (which was how long it took Medicredit to process the letter). For that, Lupia contended, Medicredit could not shield itself under the bona fide-error defense. The district court agreed and granted Lupia’s motion for summary judgment. On appeal, Medicredit challenged Lupia’s standing in federal court and claimed the district court committed several reversible errors in granting Lupia’s motion. After review, the Tenth Circuit found no merit in any of these claims, and affirmed the district court. View "Lupia v. Medicredit" on Justia Law

The Court of Chancery held that it lacked subject matter jurisdiction to dissolve or to declare the proper managers of a foreign entity.This dispute involved a company formed by two friends - a sweat equity partner and a financial partner - that was converted to a Puerto Rican limited liability company in 2018. When the financial member leveraged its majority interest to unilaterally amend the operating agreement and remove the sweat equity partner from his managerial role the sweat equity member challenged its dilution, the conversion, and the partner's removal from management. The sweat equity member further requested an order dissolving the company. The Court of Chancery held (1) the company's conversion to a Puerto Rican entity stripped the Court of Chancery of statutory jurisdiction to declare the company's present managers and to order judicial dissolution; and (2) the Court was without subject matter jurisdiction to work an equitable dissolution of a Puerto Rican entity. View "In re Coinmint, LLC" on Justia Law

The Supreme Court dismissed this appeal seeking review of four adverse pretrial decisions after the circuit court granted summary judgment on some of the parties' claims, holding that accepting appellate jurisdiction would lead to piecemeal litigation of the myriad claims among the four parties.When one of three founding members of a cooperative grazing association died, his estate invoked a provision of the bylaws of the association to withdraw real estate that was previously contributed to the association and sell it to a third party. Another member objected, leading to this litigation. The circuit court granted summary judgment to the estate as to certain claims but did not determine all of the various claims among the parties. Two parties appealed, seeking review of four adverse pretrial decisions. The Supreme Court dismissed the appeal, holding that the justification for the S.D. Codified Laws 15-6-54(b) certification was not readily apparent from the record. View "Nelson v. Campbell" on Justia Law

Healthcare revenue cycle management contractors manage billing and behind-the-scenes aspects of patient care, from pre-registering patients to reviewing and approving documentation upon release. Reid Hospital contracted with Dell, a revenue cycle management contractor. Their contract limited both sides’ damages in a breach of contract action in the absence of willful misconduct or gross negligence. Dell sold much of its portfolio to Conifer in 2012 while Dell was still losing money on the Reid contract. Conifer began reducing staff and neglecting duties; there was a slowdown throughout the revenue-management cycle and in processing patients’ discharge forms, leading to longer hospital stays that third-party payors refused to reimburse fully. After two years, Reid took its revenue operation back in-house. Reid's consultant found significant errors in Conifer’s work. Reid sued for breach of contract, claiming that Conifer’s actions caused the hospital to lose tens of millions of dollars. The court granted Conifer summary judgment, reading the contract as defining all claims for lost revenue as claims for “consequential damages,” prohibited absent “willful misconduct.”The Seventh Circuit reversed. Even if lost revenue is often considered consequential, this was a contract for revenue collection services and did not define all lost revenue as an indirect result of any breach. Lost revenue would have been the direct and expected result of Conifer’s failure to collect and process that revenue as required under the contract. The parties did not intend to insulate Conifer entirely from damages. View "Reid Hospital and Health Care, Inc. v. Conifer Revenue Cycle Solutions, LLC" on Justia Law

Petrobras, the American subsidiary of a Brazilian oil and gas producer, alleges that Samsung, a Korean shipbuilder, secretly bribed Petrobras executives to finalize a contract between Petrobras and Pride. In a 2007 contract, Samsung had an option to build a deep-sea drillship if Pride secured a drilling-services contract with another company. Samsung arranged to bribe Petrobras executives to secure Pride's contract for the construction of DS-5. After Petrobras put DS-5 on permanent standby and conducted an internal audit, it informed Brazilian prosecutors. A 2014 investigation into corruption throughout Brazil, included a separate bribery scheme in which Samsung contracted with Petrobras to construct two other ships.In 2019, Petrobras sued Samsung for its role in the bribery that led to the Petrobras–Pride DS-5 contract, citing common-law fraud under Texas law and the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. 1962(c),(d). The district court took judicial notice of Petrobras’s 2014 SEC filing and Washington Post and Reuters articles, describing the bribery schemes underlying other Samsung–Petrobras contracts that did not mention the Petrobras–Pride DS-5 contract. From those, the court inferred that Petrobras was on notice by 2014 that the DS-5 contract was suspect. Holding that “the specific drillship in this case is not subject to its own limitations clock,” the district court dismissed the suit. The Fifth Circuit reversed. The pleadings do not establish as a matter of law that Petrobras had actual or constructive notice of its injury before March 2015, so dismissal at the pleading stage was improper. View "Petrobras America, Inc. v. Samsung Heavy Industries Co., Ltd." on Justia Law