Justia Business Law Opinion Summaries

In this case, Robert Sproat was convicted on ten counts of securities fraud. On appeal, Sproat argued that the district court improperly coerced the jurors into reaching a unanimous guilty verdict by instructing them to return the next day after they had reported an impasse in their deliberations.The United States Court of Appeals for the Ninth Circuit affirmed the conviction, rejecting Sproat's argument. The court held that merely instructing a jury that reported an impasse to return the next day is not unconstitutionally coercive. The court found that the district court's instruction to return did not amount to an Allen charge, an instruction encouraging jurors to reach a unanimous verdict. The court explained that no such encouragement was explicit or implicit in the district court's instruction.The court also observed that the district court had not asked the jury to identify the nature of its impasse or the vote count before excusing them for the evening, and that any theoretical risk of coercion was cured by the partial Allen instruction the district court gave the following day, emphasizing the jurors' freedom to maintain their honest beliefs and their ability to be excused if they could not overcome their impasse. The court concluded that the district court's instruction to return the next day and the partial Allen instruction the following day did not coerce the jurors into reaching a unanimous guilty verdict. View "USA V. SPROAT" on Justia Law

The case involved a dispute between Winn-Dixie Stores and the Eastern Mushroom Marketing Cooperative, Inc. (EMMC), its individual mushroom farmer members, and certain downstream distributors. Winn-Dixie accused the defendants of violating antitrust laws by engaging in a price-fixing agreement. The U.S. Court of Appeals for the Third Circuit held that the District Court was correct in applying the rule of reason, rather than a "quick-look" review, in assessing the legality of the defendants' pricing policy under the Sherman Act. The court found that the complex and variable nature of the arrangements within the cooperative, involving both horizontal and vertical components, necessitated a careful analysis to determine anticompetitive effects. The court also held that the jury's verdict, which found that the defendants' pricing policy did not harm competition, was not against the weight of the evidence and did not warrant a new trial. The court affirmed the District Court’s judgment in favor of the defendants. View "Winn Dixie Stores v. Eastern Mushroom Marketing Cooperative Inc" on Justia Law

In a putative securities-fraud class action, Union Asset Management Holding AG and Teamsters Local 710 Pension Fund (the “Investors”), co-lead plaintiffs, alleged that Philip Morris International Inc. (“PMI”) and several of its current and former executives (the “Defendants”) made false and misleading statements about PMI’s “IQOS” smoke-free tobacco products. The United States Court of Appeals for the Second Circuit affirmed the district court's dismissal of the Investors' complaints. The court found that PMI's statements about its scientific studies complied with a methodological standard and were properly analyzed as statements of opinion, rather than fact. The court also determined that the Defendants' interpretation of scientific data, which was ultimately endorsed by the Food and Drug Administration (FDA), was per se reasonable as a matter of law. Further, the court held that the Investors had either failed to plead material falsity or abandoned their challenges on appeal regarding PMI’s statements about its projections for IQOS’s performance in Japanese markets. Finally, the court concluded that the Investors' claim for control-person liability under section 20(a) of the Exchange Act also failed because they had not established a primary violation by the controlled person. View "In re Philip Morris Int'l Inc. Sec. Litig." on Justia Law

In this case, a group of California wholesale businesses, the plaintiffs, brought a lawsuit against Innovation Ventures, LLC, and Living Essentials, LLC, the defendants, under the Robinson-Patman Price Discrimination Act. The plaintiffs accused the defendants of offering less favorable pricing, discounts, and reimbursements to them than to the Costco Wholesale Corporation for the sale of 5-hour Energy drink. The United States Court of Appeals for the Ninth Circuit affirmed in part and reversed in part the district court’s judgment.The court held that the district court did not abuse its discretion in instructing the jury that the plaintiffs needed to show that Living Essentials made “reasonably contemporaneous” sales to them and to Costco at different prices and that the price discrimination was not justified by functional discounts compensating Costco for marketing or promotional functions. The court concluded that the functional discount doctrine was available to the defendants, regardless of whether the plaintiffs and Living Essentials were on the same level in the distribution chain.However, the court vacated the district court's ruling on the plaintiffs' claim for injunctive relief under section 2(d) of the Robinson-Patman Act. This section prohibits a seller from providing anything of value to one customer unless it is available on proportionally equal terms to all other competing customers. The court found that the district court committed legal and factual errors in determining that Costco and the plaintiffs operated at different functional levels and therefore competed for different customers of 5-hour Energy. The case was remanded for the district court to reconsider whether Costco and the plaintiffs purchased 5-hour Energy from Living Essentials within approximately the same period of time, or if the plaintiffs were otherwise able to prove competition. View "U.S. WHOLESALE OUTLET & DISTR. V. INNOVATION VENTURES, LLC" on Justia Law

The case before the United States Court of Appeals for the Eighth Circuit involved Allen Thomas Bloodworth, II, a business owner who operated two towing businesses in Kansas City. Bloodworth alleged that the Kansas City Board of Police Commissioners and fourteen officers of the Kansas City Police Department conspired to stop him from running his businesses and shut down his ability to conduct business in Kansas City. He brought 17 state and federal claims, including defamation, tortious interference with contract and business expectancy, intentional infliction of emotional distress, and negligent hiring, training, supervision, or retention. He also alleged Fourth Amendment violations for an unlawful warrant search and seizure of his residence and business, the shooting of his dog during the search, and the seizure of business records.The district court granted summary judgment in favor of the defendants. On appeal, the Eighth Circuit affirmed the ruling. The appellate court concluded that Bloodworth failed to link the specific conduct of individual defendants to the alleged constitutional violations, and his claims were based on general assertions mostly. It also ruled that Bloodworth failed to establish that the defendants' conduct was extreme and outrageous to support his claim for intentional infliction of emotional distress. The court further found that Bloodworth failed to establish a constitutional violation resulting from the official policy, unlawful practice, custom, or failure to properly train, retain, supervise, or discipline the police officers. Therefore, there was no basis for municipal liability against the Kansas City Board of Police Commissioners. View "Bloodworth v. Kansas City Board of Police Commissioners" on Justia Law

In this case before the Supreme Court of Alabama, the plaintiffs were the children of Robert Crum Jr., who was killed when the concrete truck he was driving overturned due to a tire failure. The tire was a 10-year-old Hankook AH10 tire, and the plaintiffs sued the companies that allegedly designed, manufactured, and distributed the tire, Hankook Tire America Corporation and Hankook Tire & Technology Co., Ltd. ("Hankook"). The plaintiffs alleged that the tire was defective and caused the accident. They sought to depose Hankook's designated corporate representative, Won Yong Choi, and claimed that he provided evasive answers or did not answer at all. They also alleged that Hankook's attorney consistently interrupted the deposition, objected to questions, and instructed Choi not to answer. As a result, the plaintiffs moved the trial court to impose sanctions against Hankook.The trial court granted the motion and imposed sanctions that included prohibiting Hankook from having any corporate representative give testimony at trial that went beyond Choi's deposition testimony, barring Hankook from disputing at trial that the failed tire was defective, and striking 10 of Hankook's affirmative defenses. The trial court also ordered the plaintiffs to submit evidence of the attorneys' fees and costs they had incurred in preparing for and taking Choi's deposition. After they did so, the trial court entered an order awarding the plaintiffs $66,550 in attorneys' fees.Hankook petitioned the Supreme Court of Alabama for a writ of mandamus, asking the court to direct the trial court to vacate the sanctions order and the fee order. The Supreme Court of Alabama granted the petition, holding that the sanctions imposed by the trial court were not authorized by Rule 37(d) because Choi did not fail to appear for the Rule 30(b)(6) deposition. Therefore, the court directed the trial court to vacate both its initial order sanctioning Hankook and its later order imposing a monetary sanction. View "Ex parte Hankook Tire America Corporation PETITION FOR WRIT OF MANDAMUS" on Justia Law

The Supreme Court of Missouri reversed the circuit court's ruling and held that the Truly Agreed and Finally Passed House Bill 1606 (2022) (“TAFP HB 1606”) violated the single subject requirement of article III, section 23 of the Missouri Constitution. The bill was initially proposed to reduce the amount of information certain counties had to publish in their financial statements. However, the bill underwent several modifications, including the addition of section 67.2300, which imposed restrictions on the expenditure of state funds for combating homelessness and made unauthorized sleeping and camping on state-owned lands a class C misdemeanor. The appellants, including a group of individuals and a non-profit organization, argued that the addition of section 67.2300 altered the bill's original purpose, introduced a second subject to the bill, and rendered the bill's title unclear, thereby violating the single subject, clear title, and original purpose requirements of the Missouri Constitution. The court agreed, finding that the provisions of section 67.2300 did not fairly relate to or have a natural connection with the bill's general subject of "political subdivisions," but rather related to the completely different subject of homelessness. Consequently, the court declared TAFP HB 1606 invalid in its entirety. View "Byrd v. State of Missouri" on Justia Law

In a wrongful death action brought by Laura Milus on behalf of herself and her minor child against Sun Valley Company, the Supreme Court of the State of Idaho reversed the district court's grant of summary judgment to the defendant, Sun Valley. Ms. Milus' husband died after colliding with snowmaking equipment while skiing at Sun Valley Ski Resort. Ms. Milus alleged that Sun Valley breached its duties under Idaho Code section 6-1103(2) and (6), which require ski area operators to mark snowmaking equipment with visible signs or warning implements and place a conspicuous notice at or near the top of a trail or slope when snowmaking operations are being undertaken. The district court granted Sun Valley's summary judgment motion, concluding that Sun Valley had fulfilled its duty under section 6-1103(2) by marking the snowmaking equipment with yellow padding and did not have a duty under section 6-1103(6) because the snowmaking equipment was not actively discharging snow. However, the Supreme Court of the State of Idaho reversed the district court's decision, finding that the question of whether the yellow padding constitutes a warning implement under section 6-1103(2) is a question of fact for the jury. The court also held that section 6-1103(6) imposes a duty on ski area operators to place a conspicuous notice at or near the top of the trail or slope when snowmaking equipment is placed on the ski run or slope, regardless of whether the equipment is actively discharging snow. The case was remanded for further proceedings consistent with the court's opinion. View "Milus v. Sun Valley Company" on Justia Law

The Supreme Court of Idaho affirmed the lower court's decision that A.C. & C.E. Investments, Inc. (AC&CE) did not properly plead a derivative action and lacked standing to bring a direct claim in a lawsuit against Eagle Creek Irrigation Company (Eagle Creek). AC&CE, a shareholder of Eagle Creek, a nonprofit mutual irrigation corporation, challenged amendments made to Eagle Creek's bylaws and articles of incorporation that increased the number of capital shares the corporation was authorized to issue and removed a provision that Eagle Creek would hold all the water rights it acquired “in trust” for the benefit of its shareholders. AC&CE claimed Eagle Creek breached its fiduciary duty and requested that the district court declare the proposed amendments void. However, the district court concluded that AC&CE's complaint did not properly plead a derivative action, that AC&CE lacked standing to bring a direct claim, and that the amendments were validly adopted by a majority shareholder vote. The Supreme Court of Idaho affirmed these conclusions. The court also found that AC&CE's claim regarding the increase in the number of authorized capital shares was not ripe for adjudication because no additional shares had been issued. Finally, the court affirmed the lower court's denial of Eagle Creek's request for attorney fees. View "A.C. & C.E. Investments, Inc. v. Eagle Creek Irrigation Company" on Justia Law

In this case, the United States Court of Appeals for the Eighth Circuit affirmed the decision of the United States District Court for the Southern District of Iowa to dismiss the lawsuit of Iowa-based livestock feed seller Hawkeye Gold, LLC against China National Materials Industry Import and Export Corporation, also known as Sinoma, for lack of personal jurisdiction. Hawkeye Gold sued Sinoma to recover an unpaid default judgment it obtained against Sinoma's now-defunct wholly owned United States subsidiary, Non-Metals, Inc., for breach of a contract to purchase livestock feed. After six years of litigation, the District Court dismissed the case because it did not have personal jurisdiction over Sinoma, a decision which Hawkeye Gold appealed. The Appeals Court, after reviewing the evidence, agreed with the District Court's conclusion that Sinoma had insufficient minimum contacts with Iowa to support personal jurisdiction. The Court also rejected Hawkeye Gold's argument that Sinoma was a party to the contract or that Non-Metals was the alter-ego of Sinoma. Furthermore, the Court affirmed the District Court's denial of Hawkeye Gold's request for sanctions against Sinoma for alleged discovery violations. View "Hawkeye Gold, LLC v. China National Materials" on Justia Law