Justia Business Law Opinion Summaries

In this case involving a final judgment entered against a professional corporation for the fraudulent activity of one of its associates, the Supreme Judicial Court held that, in the unique circumstances of this case, Plaintiff, who was defrauded by the associate, may pursue successor liability against the sole proprietorship of Defendant, the sole shareholder and officer of the professional corporation.Plaintiff was defrauded by the corporation's associate in a mortgage scam. Defendant was the sole shareholder and officer of the corporation, RKelley-Law, P.C. (the P.C.). After the entry of final judgment against the P.C. Defendant voted to wind up the corporation and, that same day, began operating his law practice as a sole proprietorship. Thereafter, the P.C. was placed into bankruptcy proceedings. Because the P.C. had no assets, Plaintiff sought to recover from Defendant personally. The district court granted summary judgment in favor of Defendant, concluding that the doctrine of successor liability could not be applied where the successor in interest was a natural person rather than a corporate entity. The court of appeals affirmed. The Supreme Judicial Court reversed, holding that because Defendant's sole proprietorship was a mere continuation of the former professional corporation Plaintiff may pursue successor liability against the proprietorship. View "Smith v. Kelley" on Justia Law

Trustees of three employee benefit funds filed suit against Charps and others, alleging that defendants breached collective bargaining agreements by not contributing to the employee benefit funds for work performed by the affiliates, in violation of the Employee Retirement Income Security Act (ERISA). The district court granted summary judgment to defendants, awarding them attorney's fees and costs.The Eighth Circuit held that defendants did not owe contributions for the affiliates' work where the trustees have not shown a genuine issue that the defendant companies formed a relationship of alter ego, joint venture, or joint enterprise. Furthermore, the collective bargaining agreements did not require defendants to contribute for the work of Charps' affiliates. The court also held that the trustees did not meet their burden in opposing summary judgment on their claim that the district court failed to address Charps' liability for contributions based on its own employees' work, and the district court did not abuse its discretion in denying, as duplicative, the trustees' motion to compel production of the spreadsheets.Accordingly, the court affirmed the judgment in 18-3007, but reversed and remanded in 19-1206. On remand, the district court should award costs that are taxable under 28 U.S.C. 1821 and 1920. In regard to the nontaxable costs, the district court may determine whether they may be awarded as attorney's fees. View "Johnson v. Charps Welding & Fabricating, Inc." on Justia Law

Plaintiff Warner Wiggins appeals a circuit court's order compelling him to arbitrate his claims against Warren Averett, LLC. Warren Averett was an accounting firm. Eastern Shore Children's Clinic, P.C. ("Eastern Shore"), a pediatric medical practice, was a client of Warren Averett. In September 2010, while Wiggins, who was a medical doctor, was a shareholder and employee of Eastern Shore, Warren Averett and Eastern Shore entered an agreement pursuant to which Warren Averett was to provide accounting services to Eastern Shore ("the contract"). The contract contained an arbitration clause. Thereafter, Wiggins and Warren Averett became involved in a billing dispute related to the preparation of Wiggins's personal income-tax returns. In 2017, Wiggins filed a single-count complaint alleging "accounting malpractice" against Warren Averett. Warren Averett filed an answer to Wiggins's complaint, asserting, among other things, that Wiggins's claims were based on the contract and were thus subject to the arbitration clause. A majority of the Alabama Supreme Court concluded the determination of whether Wiggins' claims were covered under the terms of the arbitration clause was delegated to an arbitrator to decide. Therefore, it affirmed the trial court's order. View "Warner W. Wiggins v. Warren Averett, LLC" on Justia Law

Bentley, the owner of Trucking, rear-ended the Kolchinskys’ car while driving a tractor-trailer through Illinois. The Kolchinskys were severely injured. Bentley's deliveries had been arranged by WD, which instructed Bentley to transport milk from Indiana to its destination. His route was up to him. Trucking’s agreement with WD provided that Bentley was an independent contractor. When Trucking accepted a job from WD, it agreed to call the broker daily with a status update, protect the freight, notify the broker of any damage, and inform the broker of delivery. Tucking was responsible for determining delivery times; WD reserved the right to withhold any resulting damages. The agreement required Trucking to pay its employees and provide and maintain its own tractor, fuel, insurance, licenses, and permits. The Kolchinskys sued Bentley; citing theories of respondeat superior and vicarious liability, the Kolchinskys also sued Trucking and WDThe judge granted the defendants judgment, concluding that the driver was an independent contractor so the Kolchinskys could not hold the companies responsible for his alleged negligence. The Seventh Circuit affirmed. Courts applying Illinois law consistently have declined to find an agency relationship when a company hires an independent driver to deliver a load to designated persons at designated hours but does not reserve the right to control the manner of delivery. WD had no part in the transaction leading to Bentley’s fateful trip View "Kolchinsky v. Western Dairy Transport, LLC" on Justia Law

G4, LLC, entered into a lease in 2009 with the City of Picayune, Mississippi, for land on the grounds of the Picayune Municipal Airport. After the Pearl River County Board of Supervisors assessed ad valorem taxes on the leased land, G4 paid the taxes under protest and petitioned the Board for a refund and for a refund of taxes it had paid on lots in the Tin Hill subdivision. The Board denied G4’s petition, and G4 appealed to the Circuit Court of Pearl River County, which affirmed. G4 appealed, asserting that, according to the Mississippi Supreme Court’s decision in Rankin County Board of Supervisors v. Lakeland Income Properties, LLC, 241 So. 3d 1279 (Miss. 2018), it was automatically exempt from paying ad valorem taxes on the airport property. The Supreme Court agreed, reversed and remanded the circuit court’s decision that affirmed the Board’s refusal to refund the airport property taxes. The Court affirmed the circuit court’s decision that G4 was not entitled to a refund of taxes paid on the Tin Hill subdivision lots. View "G4, LLC v. Pearl River County Board of Supervisors" on Justia Law

The First Circuit affirmed the decision of the district court entering summary judgment against Plaintiff Jay Furtado and in favor of Defendants, attorney Amy Page Oberg and the law firm DarrowEverett LLP, and dismissing Plaintiff's claims of legal malpractice, breach of fiduciary duty, and misrepresentation, holding that summary judgment was properly granted.Plaintiff was one of three members of a limited liability company (LLC) for a gym. In 2008, Plaintiff engaged Oberg to help to establish the LLC. After the LLC stopped operations, Plaintiff brought this action. The district court entered summary judgment for Defendants. The First Circuit affirmed, holding that, even if there were any doubt that Plaintiff had waived on appeal an argument that a reasonable jury could find that a breach by Defendants proximately caused his harm, this Court would still conclude that summary judgment was proper in this case. View "Furtado v. Oberg" on Justia Law

Ambassador Press filed suit against Durst Image for fraud, alleging that the printing press that was purchased from Durst Image did not have the speed or durability Durst Image represented at the time of the purchase.The Eighth Circuit affirmed the district court's grant of Durst Image's motion to dismiss, holding that the district court correctly determined that Ambassador Press did not plausibly allege common law fraud. The court also held that the district court properly determined that reliance was not pleaded with particularity and properly granted the motion to dismiss. View "Ambassador Press, Inc. v. Durst Image Technology U.S., LLC" on Justia Law

T-Mobile customers can participate in “T-Mobile Tuesdays,” a promotional service, offering free items and discounts. Customers who no longer wish to receive marketing communications may opt-out by contacting T-Mobile’s customer service. T-Mobile user Warciak received a text message: This T-Mobile Tuesday, score a free 6” Oven Roasted Chicken sub at SUBWAY, just for being w/ T-Mobile. Ltd supply. Get app for details. The message came from T-Mobile. Warciak was not charged for the text. Warciak sued Subway claiming Subway engaged in a common-law agency relationship with T-Mobile, and that Subway’s conduct violated the Telephone Consumer Protection Act (TCPA). T-Mobile is not included in the lawsuit. The court dismissed the complaint as lacking sufficient support for claims of actual and apparent authority: control over the timing, content, or recipients of the text message. The court also found that the wireless carrier exemption applied so that no underlying TCPA violation exists ( 47 U.S.C. 227(b)(2)(C)). Prior written consent is not required for calls to a wireless customer by his wireless carrier if the customer is not charged. The Seventh Circuit affirmed. The only alleged conduct by Subway is its contractual relationship with T-Mobile. Warciak’s complaint lacks sufficient facts showing Subway manifested to the public that T-Mobile was its agent. He relied on T-Mobile’s conduct. Statements by an agent are insufficient to create apparent authority without also tracing the statements to a principal’s manifestations or control. View "Warciak v. Subway Restaurants, Inc." on Justia Law

The San Francisco Examiner sued the San Francisco Chronicle, claiming that the defendant sold a certain type of print advertising in the Chronicle at prices that violated California’s Unfair Practices Act (UPA, Bus. & Prof. Code, 17000) and Unfair Competition Law (UCL, 17200). The trial court granted the defendant summary judgment. The court of appeal affirmed. The trial court properly rejected the claim of below-cost sales under the UPA after excluding the opinion of the plaintiff’s expert on costs. The plaintiff had disclaimed reliance on specific transactions to prove the Chronicle’s alleged underpricing of its print advertising, leaving only the aggregate cost analysis prepared by that expert to establish the occurrence of alleged below-cost sales. The plaintiff’s expert lacked the foundational knowledge to conduct the requisite cost analysis and based his analysis on another individual’s non-UPA-related pricing analysis without understanding its foundations, such as some of the included cost components. Summary judgment was proper as to the claim for unlawful use or sale of loss leaders under the UPA because the plaintiff failed to identify the loss leader sales on which this claim was based. The trial court did not err in granting summary judgment on the causes of action for secret and unearned discounts under the UPA. View "San Francisco Print Media Co. v. The Hearst Corp." on Justia Law

In this class action complaint brought under the Delaware Uniform Fraudulent Transfer Act (DUFTA) alleging that Genworth Life Insurance Company (GLIC) engaged in both actual and constructive fraudulent transfers the Court of Chancery granted in part and denied in part GLIC's motion to dismiss, holding that Plaintiffs' attempts to reverse some of GLIC's dividends were time barred.Plaintiffs, a class of insureds who held long-term care insurance policies and insurance agents who alleged that they were entitled to commission payments for selling such payments, alleged that on the brink of its failure, GLIC's owners engaged in an intentional plan to syphon off GLIC's assets. In their class action complaint Plaintiffs asked the Court of Chancery to restore to GLIC the value of the assets that were syphoned away from 2012 to 2014. In response, Defendants filed a motion to dismiss. The Court of Chancery granted the motion in part and denied it in part, holding (1) any challenge to the $395 million in dividends GLIC paid from 2012 to 2014 was untimely under 6 Del. C. 1309; and (2) Plaintiffs had standing to bring this lawsuit. View "Burkhart v. Genworth Financial, Inc." on Justia Law