Justia Business Law Opinion Summaries

Plaintiffs sell products as third-party merchants through Amazon’s “Fulfilled by Amazon” (“FBA”) program. Prior to October 2019, California required FBA merchants to collect and pay sales tax on sales to California residents. California’s Marketplace Facilitator Act altered that requirement. However, the Marketplace Facilitator Act is not retroactive and the Department continued to seek sales tax remittances from third-party FBA merchants for pre-October 2019 sales.Plaintiffs claimed that the California Department of Tax and Fee Administration’s tax collection efforts against Guild members violated the Due Process, Equal Protection, Privileges and Immunities, and Commerce Clauses of the United States Constitution, as well as the Internet Tax Freedom Act, 47 U.S.C. Sec. 151. The district court granted the Department’s motion to dismiss, holding that the Guild’s claims were barred by the Tax Injunction Act (“TIA”), 28 U.S.C. Sec. 1341.The Ninth Circuit affirmed, finding that the district cour properly dismissed the action pursuant to the TIA, which bars federal jurisdiction over the Guild’s claims because the Guild seeks an injunction that would to some degree stop the assessment or collection of a state tax and an adequate state law remedy exists. View "ONLINE MERCHANTS GUILD V. NICOLAS MADUROS" on Justia Law

The Supreme Court held that the Due Process Clause allows North Carolina courts to exercise personal jurisdiction over companies that received millions of dollars in assets by E.I. DuPont de Nemours and Company (Old DuPont) when the company, facing liability for releasing harmful chemicals into the North Carolina environment over a period of decades, underwent a significant corporate reorganization.North Carolina brought an action against Old DuPont and its corporate successors, asserting negligence, trespass, public nuisance, fraud, and fraudulent transfer related to Old DuPont's use of harmful chemicals at its Fayetteville Works plant and its subsequent reorganization to avoid liability. At issue was whether the Due Process Clause permits jurisdiction to be exercised over a corporate successor when the predecessor is subject to jurisdiction in the forum and state law subjects the successor to liability. The Supreme Court affirmed the business court's denial of Defendants' motion to dismiss, holding that personal jurisdiction could be established through the imputation analysis for all of the State's claims arising out of or related to Old DuPont's activities in North Carolina. View "State ex rel. Stein v. E.I. DuPont de Nemours & Co" on Justia Law

The Department of Alcoholic Beverage Control (Department) revoked a nightclub’s liquor license after the club’s owner, GC Brothers Entertainment LLC dba The Palms (Petitioner), failed to respond to an accusation alleging several violations of California statutes and regulations. Petitioner appealed the Department’s decision to the Alcoholic Beverage Control Appeals Board (Appeals Board), which affirmed it, and now seeks a writ of mandate directing the Department to vacate its decision.   The Second Appellate District granted the writ. The court held that the licensing scheme and strong state policy in favor of resolving cases on the merits grant an ALJ discretion to issue an OSC when he or she receives even an arguably deficient motion for relief from default. It thus runs contrary to the spirit of the licensing scheme to insist that a licensee present its complete and best case for relief within seven days of service of a notice of default. Here, the ALJ not only apparently believed he had no discretion to liberally construe Respondent’s motion for relief, but also found that Respondent’s failure to establish an irrelevant issue—proper service—constituted a failure to show good cause for relief. The ALJ’s failure to appreciate the scope of his discretion and application of an improper standard requires that we remand the matter to afford the ALJ an opportunity to exercise his discretion in the first instance and, applying the proper standard, determine whether Petitioner has shown good cause for relief from default. View "GC Brothers Entertainment v. Alcoholic Beverage Control etc." on Justia Law

Byram Cafe Group, LLC (BCG), moved for summary judgment against Eddie and Teresa Tucker in a premises-liability action arising from Eddie’s slip-and-fall accident. BCG sought judgment as a matter of law based on a lack of evidence supporting any of the elements of a slip-and-fall case. In response, the Tuckers argued that genuine issues of material fact existed as to dangerous conditions that may have caused Eddie’s fall. The circuit court denied BCG’s summary-judgment motion, ruling that genuine issues of material fact were present. BCG sought interlocutory appeal of the circuit court’s denial of summary judgment. The Mississippi Supreme Court found that as a matter of law, the circuit court erred by denying BCG’s motion for summary judgment. The Supreme Court reversed the trial court's order and remanded for further proceedings. View "Byram Cafe Group, LLC v. Tucker" on Justia Law

Plaintiff alleges that Schwab Charitable, its board of directors, and its Investment Oversight Committee breached their fiduciary duties under California law by partnering with Schwab & Co.—a legally separate but closely related company—for brokerage, custodial, and administrative services. Plaintiff filed suit in the United States District Court for the Northern District of California. After Defendants moved to dismiss, the district court held that Plaintiff lacked standing under Article III and statutory standing under California law. The district court allowed Plaintiff to amend his complaint, but he notified the district court that he did not intend to do so, and instead wished to appeal. The district court then entered judgment for the defendants. Plaintiff timely appealed.   The Ninth Circuit affirmed the district court’s judgment, holding that Plaintiff did not have Article III standing to sue Schwab Charitable Fund for allegedly breaching its fiduciary duties by, among other things, deducting excessive fees from Plaintiff’s donor-advised fund. The panel held that it need not decide whether Plaintiff’s arguments, regarding his purported need to contribute more to the DAF and related impact on his reputation and expressive rights, were cognizable in general because Plaintiff did not allege that he had experienced or will experience any of these purported injuries. The panel concluded that Plaintiff had not adequately alleged standing based on these theories of injury. View "PHILIP PINKERT V. SCHWAB CHARITABLE FUND, ET AL" on Justia Law

Plaintiffs alleged that ViSalus, Inc., sent them automated telephone calls featuring an artificial or prerecorded voice message without prior express consent. The jury returned a verdict against ViSalus, finding that it sent 1,850,440 prerecorded calls in violation of the TCPA. Because the TCPA sets the minimum statutory damages at$500 per call, the total damages award against ViSalus was $925,220,000. Nearly two months later, the FCC granted ViSalus a retroactive waiver of the heightened written consent and disclosure requirements. ViSalus then filed post-trial motions to decertify the class, grant judgment as a matter of law, or grant a new trial on the ground that the FCC’s waiver necessarily meant ViSalus had consent for the calls made. Alternatively, ViSalus filed a post-trial motion challenging the statutory damages award as being unconstitutionally excessive. The district court denied these motions.Affirming in part, the panel held that members of the plaintiff class had Article III standing to sue because the receipt of unsolicited telemarketing phone calls in alleged violation of the TCPA is a concrete injury.The panel held that, when ruling on ViSalus’s motions to decertify the class, grant judgment as a matter of law, or grant a new trial, the district court properly refused to consider the FCC’s retroactive waiver. The panel explained that ViSalus waived a consent defense, and no intervening change in law excused this waiver of an affirmative defense.The panel vacated the district court’s denial of ViSalus’s post-trial motion challenging the constitutionality of the statutory damages award under the Due Process Clause of the Fifth Amendment. View "LORI WAKEFIELD V. VISALUS, INC." on Justia Law

The Supreme Court dismissed in part and reversed in part Appellant's appeal of the district court's rulings finding that Jerald Schreiber was unjustly enriched and ordering him to pay an additional $400,184 to a limited liability company (LLC) he owned in equal shares with his brother, Steven Schreiber, holding that the district court erred in part.Steven brought a complaint seeking the dissolution of the LLC at issue. The district court ordered dissolution and directed a receiver to liquidate the LLC's assets, including two buildings owned by the company but located on property owned by Jerald. Because Jerald made the sole offer to purchase the buildings, the parties agreed that the district court should order the receiver to accept the offer but that Steven and the LLC could continue to pursue a claim of unjust enrichment. The district court concluded that Jerald had been unjustly enriched and denied Jerald's motion asking the district court to provide further directions to the receiver. The Supreme Court (1) dismissed the order denying Jerald's motion for further directions for lack of jurisdiction; and (2) reversed the district court's order finding that Jerald was unjustly enriched, holding that the district court erred. View "Schreiber Brothers Hog Co. v. Schreiber" on Justia Law

Plaintiff, as a receiver for debtor FutureNet Group, Inc., sued FutureNet’s judgment creditors – GTR Source, LLC (“GTR”) and Capital Merchant Services, LLC (“CMS”) – and the New York City Marshal for allegedly violating New York’s procedural rules when they executed state-court judgments against FutureNet. In the action against GTR and the Marshal, the district court dismissed Plaintiff’s claims, concluding principally that FutureNet would not suffer any injury even if the executions and levies were procedurally defective, since the seized property was used to satisfy valid underlying judgments. In a similar action against CMS, the district court dismissed the suit based on issue preclusion, finding that Plaintiff’s claims hinged on the same question of law at the heart of the GTR case. The district court also held that, absent preclusion, dismissal was appropriate because FutureNet suffered no damages. Plaintiff was subsequently replaced by two of FutureNet’s senior creditors, Plymouth Venture Partners, II, L.P. and Plymouth Management Company, which now challenge both district-court decisions.   Now guided by the New York Court of Appeals’s decision that Article 52 of the CPLR is a judgment debtor’s exclusive avenue for relief from a procedurally defective execution and levy, the Second Circuit affirmed the district courts’ judgments dismissing Plaintiffs’ actions. The court explained that the New York Court of Appeals unequivocally held that a judgment debtor must “bring an appropriate action pursuant to CPLR 12 Article 52” for relief from a procedurally defective execution and levy. Here, FutureNet has not done so. Thus, the court affirmed the district court’s dismissal. View "Plymouth Venture Partners, II, L.P. v. GTR Source, LLC; Cap. Merch. Servs.," on Justia Law

Stackpole (Purchaser) makes car parts. Precision (Seller) makes automotive subcomponents. In 2014, Seller gave Purchaser quotes on pumps, making “[a]cceptance of order” subject to APQP [Advanced Product Quality Planning Review]. Purchaser issued a “Letter of Intent” to buy 1.1 million 10R/10L shafts and 306,000 Nano shafts. Seller's employee signed the letter, which provided that Purchaser would issue purchase orders for actual shipments. The purchase orders contained six pages of supplemental terms, allowing Purchaer to “terminate . . . this contract, at any time and for any reason, by giving written notice,” and providing that purchase orders would “not become binding” until the additional provisions were “signed and returned.” Seller did not sign the purchase orders but shipped parts to Purchaser for two years. In 2017, Seller stated that it needed a price increase or it would have to halt production. Purchaser agreed to price increases “under duress and protest,” then sued for breach of contract. Seller counterclaimed, alleging that Purchaser had impermissibly withheld its approval to make the parts by an automatic rather than manual process.The district court awarded Purchaser summary judgment, finding the parties had formed a contract “for successive performances.” “indefinite in duration.” Michigan law makes such contracts presumptively terminable upon “reasonable notification” A jury awarded $1 million. The Sixth Circuit affirmed. The Letter of Intent constituted a contract, notwithstanding the failure to engage in APQP. No contextual factor suggests a right to terminate the Letter of Intent without notice. View "Stackpole International Engineered Products, Ltd.. v. Angstrom Automotive Group, LLC" on Justia Law

LAD-T, LLC, dba Toyota of Downtown Los Angeles (LAD-T), and its parent company Lithia Motors Inc. (Lithia; collectively, Defendants) appeal from an order denying their motion to compel arbitration of Plaintiff’s claims brought under the California Fair Employment and Housing Act (FEHA). Defendants contend the trial court erred in finding Business and Professions Code section 17918 barred them from enforcing an arbitration agreement made in the name of an unregistered fictitious business, DT Los Angeles Toyota.   The Second Appellate District vacated the order denying Defendants’ motion to compel arbitration remanded for the trial court to address whether Defendants have waived their right to compel arbitration. The court ruled that if the trial court finds waiver, it should again deny the motion to compel arbitration; if it finds no waiver, it should grant the motion. The court explained that it agrees with Plaintiff that Defendants failed to act diligently in filing their fictitious business name statement. Accordingly, in the interests of justice the court vacated the court’s order denying the motion to compel arbitration and direct the court to again consider the motion to compel arbitration limited to the narrow issue of whether Defendants have waived their right to compel arbitration by their delay in filing the fictitious business name statement. View "Villareal v. LAD-T, LLC" on Justia Law