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Plaintiff defaulted after Defendant loaned Plaintiff money to buy a car. Defendant repossessed the vehicle and sent Plaintiff two notices in connection with its efforts to sell the car and collect any deficiency owed on the loan - a pre-sale notice and a post-sale notice. Plaintiff filed this putative class action claiming that the two notices violated the Uniform Commercial Code and Massachusetts consumer protection laws. Even though the parties did not request it, the First Circuit certified three questions to the Massachusetts Supreme Judicial Court because the outcome of this case hinged entirely on questions of Massachusetts law that Massachusetts courts have not yet addressed. View "Williams v. American Honda Finance Corp." on Justia Law

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Businesses challenged New York General Business Law section 518, which provides that “[n]o seller in any sales transaction may impose a surcharge on a holder who elects to use a credit card in lieu of payment by cash, check, or similar means,” as violating the First Amendment by regulating how they communicate their prices, and as unconstitutionally vague. The Second Circuit vacated a judgment in favor of the businesses, reasoning that in the context of singlesticker pricing—where merchants post one price and would like to charge more to customers who pay by credit card—the law required that the sticker price be the same as the price charged to credit card users. In that context, the law regulated a relationship between two prices: conduct, not speech. The Supreme Court vacated, limiting its review to single-sticker pricing. Section 518 regulates speech. It is not a typical price regulation, which simply regulates the amount a store can collect. The law tells merchants nothing about the amount they may collect from a cash or credit card payer, but regulates how sellers may communicate their prices. Section 518 is not vague as applied to the businesses; it bans the single-sticker pricing they wish to employ, and “a plaintiff whose speech is clearly proscribed cannot raise a successful vagueness claim.” View "Expressions Hair Design v. Schneiderman" on Justia Law

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Dominion and Bransen entered into a contract wherein Bransen was paid $27 million for coal product which would satisfy rigid specifications and environmental regulations. When Bransen failed to deliver product meeting the requirements, Dominion filed suit in district court. Dominion was awarded partial summary judgment on claims related to Bransen's delivery of coke breeze, and the district court held in favor of Dominion after a bench trial on its claims related to the delivery of waste coal. The district court awarded Dominion $22 million in damages. The court affirmed the district court's ruling in favor of Dominion as to liability where Bransen was liable for delivery product that did not satisfy the contracts between the parties. The court rejected Bransen's argument that the district court awarded damages, including indirect damages, in violation of Section 8.8 of the parties' contract, and rejected Bransen's challenges to the calculation of the damages award. Because the court found no error, the court affirmed the district court's judgment. View "Virginia Electric and Power v. Bransen Energy" on Justia Law

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Growers sold their perishable agricultural products on credit to a distributor, Tanimura, which made Tanimura trustee over a Perishable Agricultural Commodities Act (PACA), 7 U.S.C. 499a-499t, trust holding the perishable products and any resulting proceeds for the Growers as PACA-trust beneficiaries. Tanimura then sold the products on credit to third parties and transferred its own resulting accounts receivable to Agricap through a Factoring Agreement or sale of accounts. In this suit against Agricap, Growers alleged that the Factoring Agreement was merely a secured lending arrangement structured to look like a sale but transferring no substantial risk of nonpayment on the accounts; the accounts receivable and proceeds remained trust property under PACA; because the accounts receivable remained trust property, Tanimura breached the PACA trust and Agricap was complicit in the breach; and PACA-trust beneficiaries such as Growers held an interest superior to Agricap, and Agricap was liable to Growers. The court agreed with the district court's conclusion that Boulder Fruit Express & Heger Organic Farm Sales v. Transportation Factoring, Inc., controls the outcome of the case. The district court noted that the Ninth Circuit in Boulder Fruit expressly addressed the commercial reasonableness of a factoring agreement but implicitly rejected a separate, transfer-of-risk test. The district court further noted that the factoring agreement in Boulder Fruit transferred even less risk than the Factoring Agreement in the present case. Accordingly, the court affirmed the judgment. View "G.W. Palmer & Co. v. Agricap Financial" on Justia Law

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Leigh Murphy d/b/a Murphy Cattle Co. appealed the bankruptcy court's orders holding that Sweetwater's lien in certain cattle was superior to Murphy's rights as an unpaid seller of the cattle. The panel concluded that the result in this case would be the same under either Colorado or Nebraska law and thus relied on cases from both states interpreting the relevant provisions of the UCC; Murphy signed a document transferring ownership of the cattle to Debtor Leonard, such that others could reasonably rely on Leonard's claim of ownership; Moffat County State Bank v. Producers Livestock Marketing Assoc. does not stand for the proposition that Article 2 is inapplicable here as to the passage of title, and the bankruptcy court did not err in turning to Article 2 of the UCC; pursuant to section 2-401, title passed to Leonard at the moment the cattle were shipped; Murphy's right to have title re-vest in him when the checks were dishonored was limited to his reclamation rights; under section 2-403, when Leonard received title from Murphy at the time of shipping, he received all the title Murphy had, as well as the power to transfer good title to a good faith purchaser for value (Sweetwater in this case); the panel denied Sweetwater's request to strike Murphy's electronic record filing; and the panel denied Sweetwater's oral request for sanctions. Accordingly, the court affirmed the judgment. View "Sweetwater Cattle Co. v. Murphy" on Justia Law

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Organik and Dow both manufacture opaque polymers, hollow spheres used as additives to increase paint’s opacity. Dow has maintained its worldwide market-leader position through a combination of patent and trade-secret protections. Dow filed a complaint with the International Trade Commission requesting an investigation into whether Organik’s opaque polymer products infringed four Dow patents. The Commission granted Dow’s request, and the parties began discovery. During the proceedings, Dow amended its complaint to add allegations of trade secret misappropriation when it discovered that Organik may have coordinated the production of its opaque polymers with the assistance of former Dow employees. As Dow attempted to obtain discovery relating to the activities of those employees, Dow discovered spoliation of evidence “on a staggering scale.” The Federal Circuit affirmed the Commission’s imposition of default judgment and entry of a limited exclusion order against Organik as sanctions for the spoliation of evidence. Organik’s “willful, bad faith misconduct” deprived Dow of its ability to pursue its trade secret misappropriation claim effectively. The record supports the limited exclusion order of 25 years with the opportunity for Organik to bypass that order at any time if it can show that it has developed its opaque polymers without using Dow’s misappropriated trade secrets. View "Organik Kimya v. International Trade Commission" on Justia Law

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This dispute arose out of contract for the shipment of used tires from Puerto Rico to Vietnam. Because it arrived late to Vietnam, the shipment accrued port storage charges, demurrage charges, and related administrative fees. The district court granted summary judgment to the carrier, Mediterranean Shipping Co., concluding that Best Tire Recycling, Inc. was the shipper, and therefore, pursuant to the bills of lading, was liable to Mediterranean for unpaid ocean freight charges, shipping container demurrage, port storage, and related administrative fees. Best Tire appealed, arguing that the parties’ course of conduct overcame the presumption that Best Tire, who was identified as “shipper” on all of the bills of lading, bore liability. The First Circuit affirmed, holding that because Best Tire was designated as the shipper on the bills of lading, there were no genuine issues of material fact as to whether Best Tire was the shipper. View "Mediterranean Shipping Co. v. Best Tire Recycling, Inc." on Justia Law

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A 16-count complaint alleged conspiracy to funnel valuable pharmaceutical interests away from an entity in which the Plaintiff, CelestialRX, LLC, is a member. The claims include allegedly improper self-dealing by two members of a three-member LLC. On motions to dismiss and for summary judgment, the Delaware Chancery Court rejected a claim that plaintiffs had contractually released certain claims and analyzed the LLC agreement to conclude that good faith—a subjective standard, applies separately to both the transaction and to the conflicted party’s analysis of whether it is “fair and reasonable,” but must be read consistently with the purpose of specific standards, which is to permit conflicted transactions in certain circumstances. The court urged the parties to mediate the dispute. View "CelestialRX Investments, LLC.v. Krivulka" on Justia Law

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Chicago's personal property lease transaction tax ordinance levies a tax on the lease or rental in the city of personal property or the privilege of using in the city personal property that is leased or rented outside the city. The lessee is obliged to pay the tax. In 2011, the department of revenue issued Ruling 11, as guidance to suburban vehicle rental agencies located within three miles of Chicago’s borders. Ruling 11 stated that, in the event of an audit, the department of revenue would hold suburban rental agencies responsible for paying the tax unless there was written proof that the lessee was exempt, based upon the use of the leased vehicle outside the city. Absent such proof, the department would assume that a customer who is a Chicago resident would use the leased vehicle primarily in the city and that a customer who is not a Chicago resident would use the vehicle primarily outside the city. Hertz and Enterprise filed suit. The circuit court enjoined enforcement of the ordinance against plaintiffs with respect to short-term vehicle rental transactions occurring outside the city’s borders. The appellate court reversed. The Illinois Supreme Court found the tax unconstitutional under the state constitution Home Rule Provision. Absent an actual connection to Chicago, Ruling 11, which imposed the tax based on only a lessee’s stated intention or a conclusive presumption of use in Chicago based solely on residency, imposed a tax on transactions that take place wholly outside Chicago borders. View "Hertz Corp. v. City of Chicago" on Justia Law

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Dana had a dealer agreement in Texas with AISCO. Unbeknownst to Dana, AISCO sold off most of its assets to newly-formed DanMar, which transferred the assets to UJoints. The name “UJoints” had been a trade name used by AISCO. Under Texas Business and Commerce Coe 57.154(a)(4), “a supplier may not terminate a dealer agreement without good cause.” Good cause exists “if there has been a sale or other closeout of a substantial part of the dealer’s assets related to the business.” Dana terminated the agreement, preventing UJoints from claiming to have been authorized to step into AISCO’s shoes and become a Dana dealer in Texas. The Seventh Circuit affirmed summary judgment in favor of Dana, finding that the transfers gave Dana good cause to terminate its dealer agreement with AISCO. The court rejected an argument that Dana entered into a “dealer agreement,” with the “new, unknown entity the identity of which the owners had concealed from Dana for a significant time.” It was natural for Dana to continue selling, for a time, to its dealer’s, AISCO’s, successor—UJoints. Those sales did not make UJoints a party to a dealer agreement. View "Texas Ujoints LLC v. Dana Holding Corp." on Justia Law