Justia Commercial Law Opinion Summaries

Petitioners were defrauded by a now-defunct corporation that sold them long-term health care and estate planning services they never received. Unable to obtain compensation directly from the corporation, petitioners secured a federal bankruptcy court judgment against the corporation and applied for restitution from the Victims of Corporate Fraud Compensation Fund. The Secretary of State, who administers the Fund, denied their applications, leading petitioners to file a verified petition in the superior court for an order directing payment from the Fund. The superior court granted the petition, and the Secretary appealed.The superior court found that the bankruptcy court judgment was a qualifying judgment for compensation under the Fund. The court noted that the complaint contained allegations of fraud and requested a judgment finding the elements of fraud under California law were satisfied. The superior court also found that the administrative record contained ample evidence supporting the bankruptcy court’s default judgment against the corporation for fraud.The California Court of Appeal, Second Appellate District, reviewed the case. The court concluded that the bankruptcy court’s final judgment, which expressly adjudged petitioners as victims of intentional misrepresentation, met the Fund’s requirement for a judgment based on fraud. The court affirmed the superior court’s judgment regarding petitioners' entitlement to payment from the Fund. However, it reversed and remanded the case for the superior court to specify the amount the Secretary shall pay each petitioner, as the original order did not account for the statutory limit of $50,000 per claimant and the need to consider spouses as a single claimant. View "Alves v. Weber" on Justia Law

InfoDeli, LLC and Breht C. Burri (collectively, InfoDeli) brought a lawsuit against Western Robidoux, Inc. (WRI), Engage Mobile Solutions, LLC, and other defendants, including members of the Burri family and several companies. InfoDeli alleged copyright infringement, tortious interference, and violations of the Missouri Computer Tampering Act (MCTA). The dispute arose from a joint venture between InfoDeli and WRI, where InfoDeli created webstores for clients, and WRI provided printing and fulfillment services. The relationship deteriorated when WRI hired Engage to replace InfoDeli's webstores, leading to the lawsuit.The United States District Court for the Western District of Missouri granted summary judgment to the defendants on the copyright infringement claim, dismissed or tried the remaining claims before a jury, which found in favor of the defendants. The district court also granted in part and denied in part InfoDeli's sanctions motion and awarded attorney’s fees and costs to the defendants. InfoDeli appealed these decisions.The United States Court of Appeals for the Eighth Circuit reviewed the case. The court affirmed the district court's grant of summary judgment on the copyright infringement claim, finding that InfoDeli failed to show that the nonliteral elements of its webstores were protected by copyright. The court also upheld the district court's denial of InfoDeli's motion for summary judgment on CEVA's conversion counterclaim, finding it was timely under Missouri law. Additionally, the court affirmed the district court's denial of InfoDeli's posttrial motions for judgment as a matter of law and a new trial as untimely.The Eighth Circuit also reviewed the sanctions imposed by the district court and found no abuse of discretion in the amount awarded or the decision not to impose additional sanctions under Rule 37(e). Finally, the court upheld the award of attorney’s fees and costs to the defendants, finding that the district court did not abuse its discretion in its assessment. The court affirmed the district court's decisions in all respects. View "InfoDeli, LLC v. Western Robidoux, Inc." on Justia Law

Barry and Jacklynn Graham hired Bradshaw Renovations, LLC to renovate their home. They agreed on a contract with an initial estimate of $136,168.16, which was later revised to $139,168.16. The contract included provisions for revising estimates and required written approval for changes. Throughout the project, Bradshaw sent invoices that varied from the initial estimate, leading to the Grahams' concerns about billing practices. After paying $140,098.79, the Grahams disputed a final invoice of $18,779.15, leading to a legal dispute.The Iowa District Court for Polk County held a jury trial, which found in favor of the Grahams on their breach of contract and consumer fraud claims, awarding them $16,000 and $40,000 respectively. The court denied Bradshaw's claims for unjust enrichment and quantum meruit. Bradshaw's motions for directed verdict and judgment notwithstanding the verdict were also denied. The court awarded attorney fees to the Grahams for their consumer fraud claim.The Iowa Court of Appeals affirmed the jury verdict, the district court's denial of Bradshaw's posttrial motions, and the dismissal of Bradshaw's equitable claims. It also affirmed the attorney fee award but remanded for determination of appellate attorney fees.The Iowa Supreme Court reviewed the case and found that the Grahams did not present substantial evidence of consumer fraud as defined by Iowa Code section 714H.3(1). The court reversed the district court's ruling on the consumer fraud claim and remanded for entry of judgment consistent with this opinion. The court affirmed the district court's dismissal of Bradshaw's unjust enrichment and quantum meruit claims, as these were covered by the written contract. The court also upheld the $16,000 jury award for the breach of contract claim. View "Bradshaw Renovations, LLC v. Graham" on Justia Law

Advocacy Holdings, a company that helps clients influence public policy through its online platform OneClickPolitics, sued its former CEO, Chazz Clevinger, for breaching a noncompete agreement. Clevinger, who resigned in 2023, allegedly stole Advocacy’s customer list, started competing businesses, solicited Advocacy’s customers, and created a near duplicate of Advocacy’s platform. Advocacy sought a preliminary injunction to stop Clevinger’s actions, claiming irreparable harm.The United States District Court for the District of Columbia partially denied Advocacy’s motion for a preliminary injunction, ruling that Advocacy had not demonstrated a likelihood of irreparable harm. The court did, however, enjoin Clevinger from using Advocacy’s platform design and interface but allowed him to continue operating his competing businesses and soliciting Advocacy’s customers. Advocacy appealed the partial denial of the preliminary injunction.The United States Court of Appeals for the District of Columbia Circuit reviewed the case. The court affirmed the district court’s decision, holding that Advocacy had not shown irreparable harm. The court noted that financial injuries, such as loss of customers, are typically remediable through monetary damages and do not constitute irreparable harm. Additionally, the court found that Advocacy’s claims of reputational harm were unsubstantiated and that the stipulation of irreparable harm in the noncompete agreement was forfeited because Advocacy did not raise it in its initial motion. The court also declined to consider Advocacy’s sliding-scale argument for evaluating preliminary injunction factors, as it was raised too late. The court concluded that without a showing of irreparable harm, a preliminary injunction was not warranted. View "Clevinger v. Advocacy Holdings, Inc." on Justia Law

Tina McPherson purchased a car from Suburban Ann Arbor, a Michigan car dealership, in July 2020. She was misled into believing she had been approved for financing, paid a $2,000 down payment, and drove the car home. Later, she was informed that the financing had fallen through and was given the option to sign a new contract with worse terms or return the car. McPherson refused the new terms, and Suburban repossessed the car and kept her down payment and fees. McPherson sued Suburban, alleging violations of state and federal consumer protection laws.A federal jury found Suburban liable for statutory conversion under Michigan law and violations of the Michigan Regulation of Collection Practices Act, among other claims. The jury awarded McPherson $15,000 in actual damages, $23,000 for the value of the converted property, and $350,000 in punitive damages. The district court denied McPherson's request for treble damages but awarded her $418,995 in attorney’s fees, $11,212.61 in costs, and $6,433.65 in prejudgment interest, totaling $824,641.26. McPherson appealed the denial of treble damages and the amount of attorney’s fees awarded, while Suburban cross-appealed the fee award as excessive.The United States Court of Appeals for the Sixth Circuit reviewed the case. The court held that the district court did not abuse its discretion in denying treble damages, as the $350,000 punitive damages already served to punish and deter Suburban's conduct. The court also found that the district court properly calculated the attorney’s fees, considering the market rates and the skill of McPherson’s attorneys. The court affirmed the district court’s judgment in all respects. View "McPherson v. Suburban Ann Arbor, LLC" on Justia Law

Plaintiffs alleged that an automobile manufacturer designed, manufactured, and sold defective vehicles, specifically Dodge "muscle" cars with defective rear differentials. They filed a complaint asserting state and federal causes of action based on fraud and breach of warranty. The District Court dismissed the fraud counts and some warranty counts, allowing plaintiffs to amend their complaint. After amending, the District Court dismissed the fraud counts again and some warranty counts, but allowed two warranty counts to proceed.The United States District Court for the District of Delaware initially dismissed the complaint without prejudice, allowing plaintiffs to amend it. After the plaintiffs amended their complaint, the District Court dismissed the fraud counts and some warranty counts with prejudice, but allowed two warranty counts to proceed. The plaintiffs then moved to certify the dismissal of their fraud counts for appeal under 28 U.S.C. § 1292(b) or for final judgment under Rule 54(b). The District Court denied the request for certification under § 1292(b) but granted the request for final judgment under Rule 54(b) for the fraud counts.The United States Court of Appeals for the Third Circuit reviewed the case and determined that the District Court's Rule 54(b) judgment was not final. The Court of Appeals held that the fraud and warranty counts constituted a single claim for purposes of Rule 54(b) because they were alternative theories of recovery based on the same factual situation. As a result, the judgment did not dispose of all the rights or liabilities of one or more of the parties. Consequently, the Court of Appeals dismissed the appeal for lack of jurisdiction and instructed the District Court to vacate its order directing the entry of a partial final judgment. View "Diaz v. FCA US LLC" on Justia Law

Overhead Door Company of Indianapolis contracted with Blue Giant Equipment Corporation, a Canadian company, for the purchase of multiple dock levelers. After installation, Overhead experienced issues with the levelers and sued Blue Giant in federal court under diversity jurisdiction for breach of contract and warranty. Blue Giant moved to dismiss, citing a provision in its standard terms requiring arbitration in Ontario, Canada. The district court denied the motion, concluding that the standard terms were not incorporated into the parties' contract.The United States District Court for the Southern District of Indiana reviewed the case and denied Blue Giant's motion to dismiss. The court found that the mere reference to standard terms on a website was insufficient to incorporate those terms into the contract between Overhead and Blue Giant. Blue Giant appealed the decision.The United States Court of Appeals for the Seventh Circuit reviewed the case and reversed the district court's decision. The appellate court held that Blue Giant's reference to its Terms and Conditions on its website was sufficient to incorporate those terms into the contract. The court noted that the reference was conspicuous and provided Overhead with reasonable opportunity to take notice of the terms. The court concluded that the parties were obligated to resolve their dispute through arbitration in Ontario, Canada, as specified in the incorporated terms. The case was reversed and remanded for further proceedings consistent with this opinion. View "Garage Door Systems, LLC v Blue Giant Equipment Corp." on Justia Law

Zyla Life Sciences, LLC (Zyla) sells FDA-approved indomethacin suppositories, while Wells Pharma of Houston, LLC (Wells Pharma) sells compounded indomethacin suppositories that are not FDA-approved but are produced in a registered compounding facility. Zyla filed suit against Wells Pharma under the unfair-competition laws of six states, arguing that Wells Pharma's sales violated state laws that mirror the Federal Food, Drug, and Cosmetic Act (FDCA) by requiring FDA approval for new drugs.The United States District Court for the Southern District of Texas granted Wells Pharma's motion to dismiss, holding that the state laws were preempted by federal law. Zyla appealed the decision.The United States Court of Appeals for the Fifth Circuit reviewed the case and reversed the district court's decision. The Fifth Circuit held that state laws mirroring federal requirements are not preempted by the FDCA. The court relied on the Supreme Court's decision in California v. Zook, which established that state laws incorporating federal law do not create a conflict and are not preempted. The court also distinguished this case from Buckman Co. v. Plaintiffs’ Legal Committee, noting that Buckman involved state-law claims of fraud on a federal agency, which is a uniquely federal concern, unlike the parallel state regulations at issue here.The Fifth Circuit concluded that the state laws in question do not conflict with the FDCA and do not interfere with federal enforcement discretion. Therefore, the district court's order granting Wells Pharma's motion to dismiss was reversed, Wells Pharma's cross-appeal for attorney's fees was dismissed as moot, and the district court's order denying Zyla's motion for leave to amend was vacated. The case was remanded for further proceedings. View "Zyla Life Sciences v. Wells Pharma" on Justia Law

Kenneth Tilley sought financing from Malvern National Bank (MNB) for a real estate development project in 2009 and 2010, totaling $350,000. Tilley claimed MNB engaged in unfair dealings and sued for breach of contract, promissory estoppel, violations of the Arkansas Deceptive Trade Practices Act (ADTPA), tortious interference, negligence, and fraud. The case has been appealed multiple times, with the Arkansas Supreme Court previously reversing decisions related to Tilley's right to a jury trial.Initially, the Garland County Circuit Court struck Tilley's jury demand, which was reversed by the Arkansas Supreme Court. After remand, the circuit court reinstated a bench trial verdict, citing Act 13 of 2018, which was again reversed by the Supreme Court. On the third remand, MNB moved for summary judgment on all claims. The circuit court granted summary judgment, citing Tilley's reduction of collateral as a material alteration of the agreement, a rationale not argued by MNB. Tilley appealed this decision.The Arkansas Supreme Court reviewed the case and held that the circuit court did not violate the mandate by considering summary judgment. However, it was reversible error for the circuit court to grant summary judgment based on an unargued rationale. The Supreme Court affirmed summary judgment on Tilley's ADTPA, tortious interference, and negligence claims, finding no genuine issues of material fact. However, it reversed and remanded the summary judgment on Tilley's breach of contract, promissory estoppel, and fraud claims, determining that there were disputed material facts that required a jury trial. The case was remanded for further proceedings consistent with this opinion. View "Tilley v. Malvern National Bank" on Justia Law

Badlia Brothers, LLC, a check-cashing business, cashed 15 checks issued by the State of Maryland. These checks had already been paid by the State before Badlia presented them for payment. Some checks were deposited using a mobile app, creating "substitute checks," and were then fraudulently or negligently presented to Badlia. Others were reported lost or stolen, leading the State to issue stop payment orders and replacement checks, which were also cashed by Badlia. Badlia accepted the checks without knowledge of prior payments and sought payment from the State, which refused.Badlia filed complaints in the District Court of Maryland, claiming the right to enforce the checks as a holder in due course. The court consolidated the cases, ruled that the State enjoyed qualified immunity, and dismissed the cases. The Circuit Court for Baltimore City reversed, holding that a check is a contract, and thus, the State had waived sovereign immunity. On remand, the District Court found that Badlia was a holder in due course entitled to enforce the checks. The Circuit Court affirmed, and the State petitioned for certiorari.The Supreme Court of Maryland reviewed the case and held that a check is a contract for purposes of the State’s waiver of sovereign immunity under § 12-201(a) of the State Government Article. The court affirmed the Circuit Court's decision, concluding that the State has waived sovereign immunity for claims by a holder in due course seeking payment on an authorized State-issued check. View "Comptroller v. Badlia Brothers, LLC" on Justia Law