Justia Business Law Opinion Summaries

In 2003, jury found E*Trade liable for trade secret misappropriation and for breach of a mutual nondisclosure agreement with Ajaxo. The jury awarded damages only for the breach of contract after the court granted a nonsuit on the issue of damages for trade secret misappropriation. On remand, in 2008, a jury found no net damages for unjust enrichment and awarded nothing. The court denied Ajaxo’s request to seek a reasonable royalty under the California Uniform Trade Secret Act (Civ. Code 3426-3426.11). On second remand, the court held a bench trial, declined to award any royalty, and awarded E*Trade its costs as the prevailing party.The court of appeal affirmed. The trial court did not abuse its discretion by declining to award any reasonable royalty despite the available evidence from which a reasonable royalty theoretically might have been derived, considering its findings on the evidence, application of apportionment principles from patent law, exclusion of expert testimony and analysis of Ajaxo’s royalty model, and treatment of the “Georgia-Pacific factors” for determining a royalty rate in intellectual property disputes. The trial court did not err in its prevailing party determination and costs award despite the practical effect of Ajaxo having already obtained full satisfaction of what became a separate, final judgment in its favor following the 2006 remittitur from the first appeal, including costs. View "Ajaxo, Inc. v. E*Trade Financial Corp." on Justia Law

BBX filed suit challenging the FDIC's determination that the severance payments BBX sought to make to five former executives of the Bank were golden parachute payments and that it would approve payments of only twelve months of salary to each executive. The FDIC also concluded that BBT was required to seek and receive approval before making the reimbursement payments to BBX. The FRB subsequently approved the same payment amounts but took no action with respect to approving any payments over 12 months of salary because the FDIC had already prohibited any additional payments.The Fifth Circuit affirmed the district court's dismissal of BBX's action against FRB for lack of standing because BBX has not shown any injury it has sustained is fairly traceable to an FRB action or inaction. The court also held that the FDIC's decision to classify the proposed payments as golden parachute payments was not arbitrary or capricious, because the golden parachute statute, 12 U.S.C. 1828(k), covers the stock purchase agreement (SPA) and the proposed payments included therein. Furthermore, earlier agreements, such as severance contracts, are irrelevant because the proposed payments are being made under the SPA. The court held that the FDIC's denial of any payments in excess of 12 months' salary for each executive was not arbitrary and capricious where the explanations the FDIC offered for denying additional payments were reasonable and did not run counter to the evidence. Finally, the court rejected BBX's argument that the FDIC's requirement that BBT seek approval before reimbursing BBX was arbitrary and capricious. View "BBX Capital v. Federal Deposit Insurance Corp." on Justia Law

A Special Touch (Salon) was a sole proprietorship owned by Colleen Dorsey (Owner) offering nail, skin, massage, and permanent cosmetic services. After a 2014 audit, the Pennsylvania Department of Labor and Industry (Department), Office of Unemployment Compensation Tax Services (OUCTS) issued a Notice of Assessment to the Salon indicating that it owed unemployment compensation (UC) contributions and interest in the amount of $10,647.93 for the period of 2010 through the second quarter of 2014. This assessment was based on OUCTS’s determination that ten individuals providing work for the Salon had been misclassified as independent contractors rather than employees of the Salon, thus subjecting it to the UC taxes. This discretionary appeal to the Pennsylvania Supreme Court required a determination of what “customarily engaged” meant, as that term was used in Subsection 4(l)(2)(B) of the Unemployment Compensation Law (Law), 43 P.S. section 753(l)(2)(B). In particular, the Supreme Court had to determine whether the phrase required an individual to be involved in an independently established trade, occupation, profession, or business in actuality, as opposed to having the mere ability to be so involved. The Court concluded the phrase “customarily engaged” as used in Subsection 4(l)(2)(B) mandated that an individual actually be involved in an independently established trade, occupation, profession, or business. Because the Commonwealth Court reached a contrary conclusion, the Court reversed. View "A Special Touch v. UC Tax Services" on Justia Law

Skyrise bid $950,000 to supply “stick building” rough frame carpentry for building housing units near the University of Wisconsin-Oshkosh. Upon receiving a letter of intent from Annex, the general contractor, to enter into a contract, Skyrise blocked the project on its calendar and declined other work. Skyrise delayed returning the actual proposed contract for two months. Amex rejected Skyrise’s subsequent proposals for a broader scope of work and a different payment plan and awarded the carpentry contract to another firm. Skyrise sued for breach of contract, promissory estoppel, negligent misrepresentation, violation of the Illinois Consumer Fraud and Deceptive Business Practices Act, and violation of the Wisconsin Deceptive Trade Practices Act.The Seventh Circuit affirmed summary judgment in favor of the defendants. Although the parties signed various proposals during their negotiations, no contract formed. The undisputed, objective evidence demonstrates that both parties intended for their relationship to be governed by a detailed contract that remained under review until Skyrise ultimately rejected that contract by making material alterations. Skyrise knew or should have known, that the negotiations could fall apart before the parties entered into a binding agreement. Annex never represented to Skyrise that it had the framing subcontract. View "Skyrise Construction Group LLC v. Annex Construction LLC" on Justia Law

Michael Montgomery, an employee of Taylor Construction working as a truck dispatcher, called Superior Mat Company to rent mats for Taylor Construction’s use. From June 9, 2017, to June 27, 2017, Taylor employees drove to Superior’s location in Covington County and picked up more than seven hundred mats. When Taylor returned the mats, Superior alleged that many were in varying degrees of dirtiness, or in some cases, damaged beyond repair. Taylor paid Superior for the mats until Superior additionally billed Taylor for the mats Taylor did not return. Taylor later stopped payment on all invoices from Superior. Superior filed suit against Taylor in Covington County Circuit Court, alleging breach of contract, open account, quantum meruit, and bad-faith breach of contract. Taylor filed its answer along with a motion to transfer venue under Rule 82(d). After hearing arguments, the circuit court denied Taylor's motion. Taylor appealed. The Mississippi Supreme Court affirmed, finding the record demonstrated credible evidence that substantial events or acts occurred in Covington County. View "Taylor Construction Company, Inc. v. Superior Mat Company, Inc." on Justia Law

This case involved a dispute over the return of earnest money following termination of an agreement to purchase a storage facility between River Range, LLC, (River Range), the buyer, and Citadel Storage, LLC, (Citadel), the seller. Following River Range’s termination of the agreement, River Range demanded the return of its earnest money. Citadel refused, arguing that the deadline for the return of the earnest money had passed. The district court granted summary judgment in favor of Citadel. River Range appealed, arguing that the district court erred in holding that: (1) the agreement was unambiguous and an addendum eliminated River Range’s right to have the earnest money refunded after a certain date; (2) River Range waived its right to terminate the agreement when it did not exercise the right to terminate the agreement by the due diligence deadline; and (3) Citadel did not breach the duty of good faith and fair dealing. Finding no reversible error, the Idaho Supreme Court affirmed. View "River Range v. Citadel Storage" on Justia Law

At issue in this appeal before the Idaho Supreme Court was the doctrine of successor liability and its applicability to a business known as “Fatty’s Bar” (“Fatty’s”). Tons of Fun, LLC opened Fatty’s in October 2010 and a short time later its manager, Clay Roman, signed a textile services agreement with Alsco, Inc. The Agreement contained an automatic renewal clause, by which the Agreement would renew automatically for a period of 60 months if neither party terminated it in writing at least 90 days before its initial expiration. Fatty’s fell on difficult financial times, and closed for a period in January 2013. Soon after, Steven and Jennifer Masonheimer created a limited liability company called Fatty’s Bar, LLC, and re-opened Fatty’s in mid-February, 2013, continuing to receive textiles from Alsco. The Agreement automatically renewed in March 2016. In March 2017, Fatty’s Bar, LLC terminated the Agreement, well before the 60-month term was set to expire. Alsco then sued Fatty’s Bar, LLC and Clay Roman, seeking damages based on a liquidated damages provision in the Agreement. After a court trial, the district court held that both Fatty’s Bar, LLC and Roman, were jointly and severally liable to Alsco for damages under a liquidated damages clause that was also in the Agreement. Fatty’s Bar, LLC appealed. Finding no reversible error, the Idaho Supreme Court affirmed. View "Alsco v. Fatty's Bar" on Justia Law

The issue raised on appeal to the Delaware Supreme Court centered on the validity of a provision in several Delaware corporations’ charters requiring actions arising under the federal Securities Act of 1933 (the “Securities Act” or “1933 Act”) to be filed in a federal court. Blue Apron Holdings, Inc., Roku, Inc., and Stitch Fix, Inc. were all Delaware corporations that launched initial public offerings in 2017. Before filing their registration statements with the United States Securities and Exchange Commission (the “SEC”), each company adopted a federal-forum provision. Appellee Matthew Sciabacucchi bought shares of each company in its initial public offering or a short time later. He then sought a declaratory judgment in the Court of Chancery that the FFPs were invalid under Delaware law. The Court of Chancery held that the FFPs were indeed invalid because the “constitutive documents of a Delaware corporation cannot bind a plaintiff to a particular forum when the claim does not involve rights or relationships that were established by or under Delaware’s corporate law.” The Supreme Court disagreed and reversed, finding that such a provision could survive a facial challenge under Delaware law. View "Salzberg v. Sciabacucchi" on Justia Law

Plaintiff Alexander Walker, Jr. appealed a superior court order dismissing his claim of conspiracy to defame on res judicata grounds after finding privity between defendant Aaron Day, and other defendants in a separate defamation action. While plaintiff’s defamation action was pending, he filed a lawsuit against defendant, alleging a claim of conspiracy to commit defamation and seeking enhanced compensatory damages. The complaint described the defamation, which provided the basis for the conspiracy claim, in much the same terms as the complaint in the separate defamation action, but also alleged facts to support the conspiracy claim. Defendant moved to dismiss the conspiracy action on the grounds of, inter alia, res judicata, arguing, in part, that he was in privity with the defamation defendants for res judicata purposes. On appeal, plaintiff argued the trial court erred by: (1) deciding the privity issue at the motion to dismiss stage; and (2) applying the First Circuit Court of Appeals’ privity standard, rather than New Hampshire precedent, to determine privity. The New Hampshire Supreme Court agreed that the trial court erred by applying the privity standard used by the First Circuit, and, therefore, vacated the trial court’s ruling and remanded. View "Walker v. Day" on Justia Law

Petitioners were four Pennsylvania businesses and one individual who sought extraordinary relief from Governor Wolf’s March 19, 2020 order compelling the closure of the physical operations of all non-life-sustaining business to reduce the spread of the novel coronavirus disease (“COVID-19”). The businesses of the Petitioners were classified as non-life-sustaining. In an Emergency Application for Extraordinary Relief, Petitioners raised a series of statutory and constitutional challenges to the Governor's order, contending the Governor lacked any authority to issue it and that, even if he did have such statutory authority, it violates various of their constitutional rights. Petitioners asserted the exercise of the Pennsylvania Supreme Court’s King’s Bench jurisdiction was not only warranted but essential given the unprecedented scope and consequence of the Executive Order on businesses in the Commonwealth. Exercising King's Bench jurisdiction, the Supreme Court concluded Petitioners could not establish any constitutional bases for their challenges. The claim for relief was therefore denied. View "Friends of Danny DeVito, et al v. Wolf" on Justia Law