Justia Business Law Opinion Summaries

JELD-WEN's customers, Steves and Sons, filed suit challenging JELD-WEN's acquisition of a competitor. After a jury found that the merger violated the Clayton Antitrust Act and that Steves and Sons was entitled to treble damages, the district court granted Steves and Sons' request to unwind the merger and plans to hold an auction for the merged assets after this appeal. The district court then held another trial before a different jury on JELD-WEN's countersuit against Steves and Sons for trade secret misappropriation, allowing three individuals to intervene in the case. The jury ruled in favor of Steves and Sons on most of JELD-WEN's claims and entered judgment for the intervenors.The Fourth Circuit concluded that the district court properly declined to grant JELD-WEN judgment as a matter of law on whether Steves and Sons demonstrated antitrust injury; the district court acted within its discretion by excluding certain evidence from the antitrust trial and by ordering JELD-WEN to unwind the merger, rejecting JELD-WEN's laches defense in the process; the district court properly found that equitable relief under the Clayton Act was appropriate because the merger created a significant threat that Steves and Sons will go out of business in 2021; and JELD-WEN has not shown that the district court's jury instructions in the trade-secrets trial were improper.However, the court vacated the jury's award of future lost profits to Steves and Sons in the antitrust trial because the issue is not ripe. The court explained that the injury on which the future lost profits award was premised cannot occur until September 2021, and the Clayton Act requires a plaintiff seeking damages—as opposed to equitable relief—to "show actual injury." The court also vacated the district court's entry of judgment for the intervenors in the trade-secrets case because JELD-WEN brought no claims against them. View "Steves and Sons, Inc. v. JELD-WEN, Inc." on Justia Law

In 2010, Appellants Meso Scale Diagnostics, LLC and Meso Scale Technologies, LLC (collectively “Meso”) filed suit in Delaware against Appellee entities Roche Diagnostics GmbH, Roche Diagnostics Corp., Roche Holding Ltd., IGEN LS LLC, Lilli Acquisition Corp., IGEN International, Inc., and Bioveris Corp. (collectively “Roche”), all of which were affiliates or subsidiaries of the F. Hoffmann -- La Roche, Ltd. family of pharmaceutical and diagnostics companies. Meso alleged two counts of breach of contract. Roche prevailed at trial, and the Delaware Supreme Court affirmed the judgment in 2014. Then in 2019, Meso brought a new action asking the court to reopen the case, vacate the judgment entered after trial, and order a new trial. Meso alleged that the Vice Chancellor who decided its case four years earlier had an undisclosed disabling conflict, namely, that Roche’s counsel had been simultaneously representing him in an unrelated federal suit challenging the constitutionality of Delaware’s law providing for confidential business arbitration in the Court of Chancery (“Section 349”). In that federal litigation, which ended in 2014, the Chancellor and Vice Chancellors of the Court of Chancery, as the parties responsible for implementing the challenged statute, were nominal defendants. The Court of Chancery denied relief and dismissed the action. Meso appealed. Finding no reversible error, the Delaware Supreme Court affirmed dismissal. View "Meso Scale Diagnostics, LLC v. Roche Diagnostics GMBH" on Justia Law

Plaintiff, who holds the RIOT ACT trademark, entered into a business agreement with defendants to open the Riot Act Comedy Club in downtown D.C. Plaintiff subsequently filed suit to recover damages from defendants' alleged breaches of fiduciary duty and of the operating agreement of the limited liability company the parties formed to start the club. Defendants counterclaimed.The DC Circuit reversed the district court's dismissal of plaintiff's breach of fiduciary duty claim, holding that plaintiff adequately alleged that he and defendants were members of a member-managed LLC and that under D.C. law that suffices to plead the existence of a fiduciary duty. In this case, the district court improperly found it "clear" that a "special confidential relationship transcending an ordinary business transaction did not take place" between the parties. The court explained that the district court failed to consider relevant District of Columbia and Maryland law, the statute's clear imposition of duties of loyalty and care typical of a fiduciary, or the nature of the parties' relationship—as partners and co-managers in a business venture, not merely arms-length parties to a standard commercial transaction. However, plaintiff failed to show that the court should reverse any of the district court's evidentiary rulings. The court affirmed the district court's decision to deny defendants judgment as a matter of law on plaintiff's breach of contract claim and to deny defendants' fee petition. The court remanded for further proceedings. View "Xereas v. Heiss" on Justia Law

In this appeal concerning the scope and reach of 28 U.S.C. 1963 - a statute permitting the registration of certain judgment in a federal district court - the First Circuit affirmed the district court's judgment concluding that the New York state court judgment proffered by Plaintiff did not come within the statutory sweep and that no other cognizable basis for federal subject-matter jurisdiction had been shown, holding that the district court did not err.Plaintiff sought recognition of a Korean judgment in New York. A New York court recognized the Korean judgment and entered a judgment in Plaintiff's favor for more than $13 million. When the New York judgment went unpaid, Plaintiff filed the judgment in the United States District Court for the District of Massachusetts. Defendants moved to quash, arguing that the district court lacked subject-matter jurisdiction because 28 U.S.C. 1963 only authorized district courts to register judgments of other federal courts and not state court judgments. The district court agreed and dismissed the matter for want of subject-matter jurisdiction. The First Circuit affirmed, holding (1) section 1963 does not authorize federal courts to register state-court judgments; and (2) there were no independent grounds for federal jurisdiction here. View "Woo v. Spackman" on Justia Law

In this appeal and cross-appeal stemming from litigation that followed the termination of an almost forty-year business relationship between a company that manufactured and supplied soup base products (Manufacturer) and a company that distributed them (Distributor), the First Circuit reversed in part and vacated in part Distributor's appeal and affirmed in Manufacturer's cross appeal, holding that the district court erred in part.Following a trial, the jury awarded Distributor $255,000 in damages for its state law breach of contract and tortious interference with business relationships claims against Manufacturer. The district court granted summary judgment to Manufacturer on Distributor's claim against it under Mass. Gen. Laws ch. 93A and to Manufacturer on its counterclaim for breach of contract, for which the court awarded Manufacturer $97,843 in damages. The First Circuit held that the district court (1) erred in granting summary judgment on the Chapter 93A claim; (2) erred in striking as duplicative the jury's damages award on Distributor's breach of contract claim; (3) erred in denying Distributor prejudgment interest on the damages award it received on the tortious interference with business relations claim; and (4) erred in denying Distributor's offset request. View "Primarque Products Co. v. Williams West & Witt's Products Co." on Justia Law

Through several corporations, members of the Boersen family have farmed in Michigan for several generations. After 2016's poor crop, their corporate entities could not cover their debts. One creditor, Helena, obtained a nearly 15-million-dollar judgment against the Boersen entities and family members who ran them. Much of the farm equipment was repossessed and, unable to obtain financing, the Boersens discontinued farming until 1999, when family members Stacy and Nick formed new entities, secured financing to lease the land and remaining equipment, and resumed farming. Because the original defendants could not pay their debt, Helena sued Stacy and Nick and their new companies.The Sixth Circuit affirmed summary judgment in favor of the defendants. The leases do not transfer the debtors’ assets; none of the involved entities owes any money to Helena. Stacy and Nick’s use of the family farm’s production history to obtain crop insurance does not constitute a “transfer of assets.” Neither Stacy nor Nick was an owner, manager, or shareholder of any of the Boersen entities covered by the judgment; no Boersen legacy owner or guarantor serves as an officer of or is otherwise employed by, either new company. No original Boersen defendant received anything of value from the new companies other than fair market value payments on leases. Nor was either new company used to commit a wrong against Helena. View "Helena Agri-Enterprises, LLC v. Great Lakes Grain, LLC" on Justia Law

Putnam purchased a service-only (satellite) Subaru facility in San Francisco. Putnam entered into a temporary “Dealer Candidate Satellite Service Facility Agreement.” Subaru and Putnam subsequently executed a Subaru Dealer Agreement for the sale and service of vehicles at a Burlingame dealership and a five-year (renewable) Satellite Service Facility Agreement, which contained an arbitration provision. In 2017, Subaru stated that it would not approve Putnam’s proposed relocation of the satellite facility and would not renew the Satellite Agreement in 2019. Putnam filed protests with the New Motor Vehicle Board. Subaru moved to compel arbitration.The trial court found that the Satellite Agreement did not come within the Motor Vehicle Franchise Contract Arbitration Fairness Act, an exception to the Federal Arbitration Act. Putnam was compelled to arbitrate claims arising from that agreement. The court denied Subaru’s request to compel Putnam to dismiss its Board protests, which were stayed pending arbitration. An arbitrator found that the Satellite Agreement was a franchise, that Subaru was required to show good cause, and that Subaru had established good cause for terminating the Satellite Agreement.The court of appeal affirmed the confirmation of the arbitration award, rejecting arguments that the arbitrator lacked jurisdiction to make a good cause determination; enforcement of the arbitration provision was illegal under the Vehicle Code; public policy underlying California’s New Motor Vehicle Board Act precluded the arbitrator from making a good cause determination; and that Putnam’s due process rights were violated when Subaru failed to provide the required notice of the reasons for termination. View "Subaru of America, Inc. v. Putnam Automotive, Inc." on Justia Law

Choice Feed, Inc. sued Ray and Susan Montierth, alleging that Ray breached an oral agreement to sell his feedlot property to Choice Feed once he arranged a 1031 tax deferred agreement. Although Ray collected money from Choice Feed that was to go toward the purchase of the feedlot property, he never arranged the 1031 exchange. Instead, without notice to Choice Feed, Ray sold the feedlot property to someone else while continuing to accept monthly payments from Choice Feed. At the conclusion of the trial, the jury found in favor of Choice Feed on one count of fraud against Ray, awarded compensatory damages, and assessed $250,000 in punitive damages. Ray moved for judgment notwithstanding the verdict, which the district court granted in part, thereby reducing the jury’s awards of both the compensatory and punitive damages. Ray appealed the jury’s verdict, including the compensatory and punitive damages that were reduced by the district court. Choice Feed cross-appealed the district court’s decision granting Ray’s motion for judgment notwithstanding the verdict and the resulting reduction in damages. After its review, the Idaho Supreme Court affirmed the district court on all issues raised in Ray’s direct appeal: (1) to deny Ray’s motion to dismiss for Choice Feed’s failure to plead fraud with particularity; (2) to give jury instructions that conformed with the evidence presented at trial; (3) to allow Choice Feed to seek improvement expenses as damages at trial; (4) to allow the jury to consider punitive damages; and, (5) to consider punitive damages in its prevailing party analysis and its conclusion that Choice Feed was the prevailing party. The Supreme Court also rejected Ray’s argument that Choice Feed did not have standing to bring suit or that it was not the real party in interest and the Court declined to add a tenth element of a transfer or sale of property to common law fraud. On Choice Feed’s cross-appeal, the Supreme Court reversed the district court’s decision to grant Ray’s JNOV motion and reduce the compensatory damage and punitive damage awards as raised in Choice Feed’s cross-appeal. However, the Court affirmed the district court on Choice Feed’s remaining issue raised in its cross-appeal concerning the award of prejudgment interest to Ray on his open account hay claim. Costs and attorney fees are awarded to Choice Feed as the overall prevailing party on appeal. View "Choice Feed Inc. v. Montierth" on Justia Law

Plaintiffs filed suit alleging that defendants unlawfully used photographs of them to advertise strip clubs owned by defendants in violation of New York Civil Rights Law sections 50 and 51. The district court granted summary judgment for defendants, holding that plaintiffs signed full releases of their rights to the photographs.The Second Circuit concluded that the terms of Plaintiff Shake and Hinton's release agreements are disputed material facts, and defendants concede that neither they nor the third-party contractors that created and published the advertisements secured legal rights to use any of the photographs at issue. The court held that the district court erred in granting summary judgment to defendants and in denying summary judgment to plaintiffs on liability. Therefore, the court vacated in part and remanded for further proceedings.The court affirmed in part and held that the district court correctly concluded that plaintiffs had not accepted the offer of judgment because the offer's settlement amount term was ambiguous, the parties disagreed over how to interpret the term, and there was accordingly no meeting of the minds. Finally, the court held that the district court correctly dismissed the Lanham Act, 15 U.S.C. 1125(a), New York General Business Law Section 349, and libel claims. View "Electra v. 59 Murray Enterprises, Inc." on Justia Law

In 2010, Appellants Meso Scale Diagnostics, LLC and Meso Scale Technologies, LLC (collectively “Meso”) filed suit in the Delaware Court of Chancery against Appellee entities Roche Diagnostics GmbH, Roche Diagnostics Corp., Roche Holding Ltd., IGEN LS LLC, Lilli Acquisition Corp., IGEN International, Inc., and Bioveris Corp. (collectively “Roche”), all of which were affiliates or subsidiaries of the F. Hoffmann -- La Roche, Ltd. family of pharmaceutical and diagnostics companies. Meso alleged two counts of breach of contract. Roche prevailed at trial, and the Delaware Supreme Court affirmed the judgment in 2014. In 2019, Meso brought a new action asking the court to reopen the case, vacate the judgment entered after trial, and order a new trial. Meso alleged that the Vice Chancellor who decided its case four years earlier had an undisclosed disabling conflict, namely, that Roche’s counsel had been simultaneously representing him in an unrelated federal suit challenging the constitutionality of Delaware’s law providing for confidential business arbitration in the Court of Chancery, 10 Del. C. 349. In that federal litigation, which ended in 2014, the Chancellor and Vice Chancellors of the Court of Chancery, as the parties responsible for implementing the challenged statute, were nominal defendants (hereinafter, the “Judicial Officers”). The Court of Chancery denied relief and dismissed the action. Meso appealed. Finding no reversible error, the Supreme Court affirmed the Court of Chancery. View "Meso Scale Diagnostics, LLC v. Roche Diagnostics GMBH" on Justia Law