Justia Business Law Opinion Summaries

The Washington Supreme Court was presented an issue of first impression: whether Washington should adopt the "apparent manufacturer" doctrine for common law product liability claims predating the 1981 product liability and tort reform act (WPLA). By this opinion, the Court joined the clear majority of states that formally adopted the apparent manufacturer doctrine. Applying that doctrine to the particular facts of this case, the Court held genuine issues of material fact existed as to whether a reasonable consumer could have believed Pfizer was a manufacturer of asbestos products that caused Vernon Rublee's illness and death. The Court reversed the court of appeals and remanded this case for further proceedings. View "Rublee v. Carrier Corp." on Justia Law

This appeal stemmed from RPD's purchase of a patent license from multiple debtors in bankruptcy sales of their estates. Tech Pharm alleged that RPD did not have rights under the license to Tech Pharm's patented invention. The bankruptcy court held that RPD did not have rights and the district court agreed.The Fifth Circuit affirmed the district court's judgment and held that the patent license was a rejected executory contract and could not have been transferred by the bankruptcy sales in question. In this case, because the license agreement was an executory contract deemed rejected by operation of law, RPD could not and did not acquire the license from any of the Grapevine, Western Pennsylvania, and Waco estates—and no bankruptcy court order held otherwise. Finally, the court held that the bankruptcy court did not exceed its authority in addressing RPD's rights through purchase of the OnSite machines, and did not err in reading the license agreement to require that third parties operate OnSite machines in the same locations where they were placed at the time of sale. View "RPD Holdings, LLC v. Tech Pharmacy Services" on Justia Law

In 2007, OFTI sold a mill to TAK. During the financial crunch, Goldman Sachs cut $19 million from the financing. OFTI had promised clean title, but with the reduced financing, was unable to pay off all security interests. TAK agreed to issue negotiable notes, aggregating about $16 million, to OFTI, which would offer them as substitute security. The creditors accepted the notes. The transaction closed. OFTI promised to pay the notes. The lenders who released their security had the credit of both companies behind the notes. TAK was to hire an OFTI construction firm to build new mills; if TAK did not arrange for this construction and did not pay the notes, OFTI could cancel the notes and acquire a 27% interest in TAK. Neither paid the notes. The new mills did not materialize. OFTI demanded a 27% equity interest in TAK. Some formerly secured creditors have not been paid and retain promissory notes; OFTI does not possess any of the notes. The Seventh Circuit affirmed the denial of relief. A hold-harmless agreement effectively prevents OFTI from enforcing the notes against TAK; whatever TAK gave to OFTI would be returned in indemnification. The notes were designed as security for third parties, not as compensation for OFTI. Additionally, under Wisconsin’s UCC applicable to negotiable instruments, OFTI is not entitled to enforce the notes because it is not their holder, is not in possession of them, and is not entitled to enforce them under specified sections. If OFTI could use nonpayment as a reason to cancel the notes, they would be worthless to the creditors. View "Tissue Technology LLC v. TAK Investments LLC" on Justia Law

IberiaBank filed suit against defendant in state court under the Computer Fraud and Abuse Act (CFAA), seeking a declaratory judgment that IberiaBank was not required to pay defendant, a former employee, his success bonus. After the parties agreed to close arbitration and pursue claims in federal court, the district court granted summary judgment on some claims and, at a bench trial, a magistrate judge resolved the remaining claims. Both parties appealed.The Fifth Circuit held that the trial court did not clearly err by concluding that defendant breached the Change-in-Control Severance Agreement; that IberiaBank did not breach its employment agreement with defendant; and that defendant violated the CFAA because there was sufficient evidence to support the trial court's finding that defendant lacked authorization to delete IberiaBank files. The court declined to resolve whether there was a Louisiana Unfair Trade Practices Act violation in this case and remanded for the trial court to consider the claim. The court held that the district court correctly held that IberiaBank's litigation behavior did not demonstrate actual malice. Finally, the court affirmed the rulings on attorneys' fees. View "IberiaBank v. Broussard" on Justia Law

The First Circuit affirmed the judgment of the district court dismissing this contract action for lack of personal jurisdiction over the defendants in Maine, holding that the district court did not err in concluding that the exercise of jurisdiction over Defendants would not comport with due process.The underlying dispute involved agreements about Defendants’ interests in an Illinois limited partnership, Elm Street Plaz Venture, LLLP. LP Solutions LLC (LPS), a Maine company, offered to buy limited interests owned by Defendants, who mostly resided in Illinois. Defendants accepted the offer and made distribution payments. When Defendants later refused to deliver partnership distributions that LPS said were assigned to it, LPS sued Defendants in Maine. The case was removed to federal district court, which determined that there was no personal jurisdiction because Defendants' contacts with Maine did not make the exercise of personal jurisdiction foreseeable. The First Circuit affirmed, holding that Defendants could not foresee the exercise of jurisdiction. View "LP Solutions LLC v. Duchossois" on Justia Law

Plaintiff MCI Communications Services, Inc. (MCI) appealed the dismissal of its action for a state tax refund after the trial court sustained California Department of Tax and Fee Administration's (CDTFA) demurrer to MCI's first amended complaint without leave to amend. Certain categories of property are excluded from the definition of tangible personal property and therefore are not subject to sales and use taxation. This appeal required the Court of Appeal to decide whether the tax exclusion in Rev. & Tax. Code section 6016.5 extended to the pre-installation component parts that may one day be incorporated into completed telephone and telegraph systems. The Court held that section 6016.5 excluded only fully installed and completed telephone and telegraph lines from sales and use taxation, not the pre-installation component parts of such lines. Accordingly, the Court affirmed the judgment. View "MCI Communications etc. v. Cal. Dept. of Tax and Fee Admin." on Justia Law

The Court of Appeals answered a certified question from the United States Court of Appeals for the Second Circuit concerning the meaning of N.Y. Gen. Bus. Law 518 in the affirmative, holding that a merchant complies with the statute so long as the merchant posts the total dollars and cents price charged to credit card users.Section 518 states that no seller in any sales transaction may impose a surcharge on a holder who uses a credit card to pay rather than cash, check, or similar means. The parties in this case agreed that the statute allows for differential pricing, in which a merchant offers discounts to customers who pay by cash so that customers buying the same item pay a higher price if they use a credit card than if they paid cash. The Court of Appeals concluded that a merchant may describe the difference between the credit card price and the cash price as a “surcharge, “additional fee,” or “extra costs” so long as the merchant posts the total dollars-and-cents price charged to credit card users rather than requiring consumers to engage in an arithmetical calculation. View "Expressions Hair Design v. Schneiderman" on Justia Law

Plaintiff Atronix, Inc. filed suit against defendant Kenneth Morris for, among other things, breach of contract, and sued defendant Scott Electronics, Inc. for tortious interference with contractual relations. Atronix appealed a superior court’s order dismissing its action for lack of standing. Morris started working at Atronix Sales, Inc. (Old Atronix) in 1982. He was promoted several times over the course of his employment, eventually becoming program manager in the sales department. That position entailed responsibility for the largest and most important of Old Atronix’s accounts. Accordingly, in 1997, Morris was required to sign a non-compete and non-solicitation agreement (the non-compete agreement), and a non-disclosure agreement. In 2011, Old Atronix merged with Atronix, Inc. (the Company). In 2016, Morris left his job with plaintiff and was hired as a general manager by Scott, one of the Company’s competitors. The New Hampshire Supreme Court concluded the terms of Morris’ non-compete agreement was conveyed to the Company according to the terms of its asset purchase agreement, it was still pertinent to the success of the merger. The Company, therefore, had standing to enforce it against Morris. View "Atronix, Inc. v. Morris" on Justia Law

Linda Unger, as personal representative of the estate of Marshall Unger ("Unger") deceased, appealed the grant of summary judgment in favor of Wal-Mart Stores East, L.P., and its employees, Naomi Phillips (the store greeter) and Billy Odom (the store manager, collectively referred to as "the Wal-Mart defendants" or “defendants”). On May 20, 2014, Unger, who was 77 years old, and his wife, Linda, visited a Wal-Mart discount store in Mobile. In an attempt to dislodge a stuck shopping cart from the front of the store, Unger lost his balance and fell to the floor, allegedly suffering two fractured vertebrae in his thoracic spine. Several Wal-Mart employees went to Unger's assistance and offered to call an ambulance, but Unger told the employees that he did not require an ambulance. In January 2015, Unger sued Wal-Mart Stores East, L.P., Billy Odom, and fictitiously named defendants alleging that, on the day he was injured, Phillips, the store greeter, had been negligent and/or wanton in failing to "stage a clean [shopping] cart for easy access in violation of Wal-Mart's policies"; that "the Wal-Mart employee collecting carts from outside the store overloaded the machine used for collecting carts creating an unsafe condition that consumers would have no knowledge of"; and that Wal-Mart had been negligent and/or wanton in failing to train and/or supervise its employees. Unger died in April 2016, while his action was pending. The Alabama Supreme Court concluded plaintiff failed to establish by substantial evidence that Wal-Mart had a legal duty to provide Unger, a business invitee, with a staged shopping cart when he entered the store on May 20, 2014. Accordingly, the summary judgment in favor of the Wal-Mart defendants was affirmed. View "Unger v. Wal-Mart Stores East, L.P." on Justia Law

Brand Services appealed the district court's grant of summary judgment for Irex on Brand Services's Louisiana Uniform Trade Secrets Act (LUTSA) claim and its common law conversion claim. The Fifth Circuit affirmed as to the common law conversion claim based on trade secrets.The court held that LUTSA preempts a common-law claim for conversion of trade secrets, but does not preempt a common-law conversion claim for confidential information that is not a trade secret. In this case, the court reversed as to the LUTSA claim and Brand Services's common law claim for conversion of allegedly non-trade secret information outside the definition of a trade secret without reaching the merits of that claim. The court remanded for further proceedings. View "Brand Services, LLC. v. Irex Corp." on Justia Law