Justia Commercial Law Opinion Summaries

Court-appointed receiver Michael Polsky filed a complaint against defendants Daniel Virnich and Jack Moores, owners and officers of Communications Products, for breach of their fiduciary duties to the corporation after Communications Products defaulted on a loan to its largest creditor. The Supreme Court accepted review but split three to three. On return to the court of appeals, the judgment was reversed. Polsky filed a petition to review, which the Supreme Court granted. The Court then affirmed the court of appeals. The current action involved Polsky's motion to disqualify Justice Roggensack, asserting that because Justice Roggensack had not participated in the case when it was previously certified to the Court and when the Court's decision remanded the matter to the court of appeals, she should have been disqualified from participation in the decision to affirm the court of appeals. The Supreme Court denied Polsky's motion, holding (1) the Court does not have the power to remove a justice from participating in an individual proceeding, on a case-by-case basis, and (2) due process is provided by the decisions of the individual justices who participate in the cases presented to the court.

When Dennis Lindskov purchased Les Lindskov's interest in an automotive company, Dennis and Les signed a dissolution agreement that contained a non-disparagement clause. Les opened a competing business within months of the sale of his interest in the company. Dennis initiated a breach of contract and fraud and deceit action, alleging that the non-disparagement clause contained a covenant not to compete. The trial court granted Les's motions for summary judgment on both causes of action and dismissed Dennis's complaint. On appeal, the Supreme Court affirmed, holding the trial court properly granted Les's motions for summary judgment where (1) because the clause did not create a covenant not to compete, Les did not breach the dissolution agreement by opening a competing business, and (2) because Les did not have a fiduciary duty to disclose his intent to compete, he did not commit fraud or deceit as a matter of law.

Plaintiff's suit concerning purchase of an aircraft claimed specific performance; and, in the alternative, breach of contract; breach of the covenants of good faith and fair dealing; and breach of the Florida Deceptive and Unfair Trade Practices Act (FDUTPA), Fla. Stat. 501.2105. The district court rejected the claims; proceeded under the Arizona Consumer Fraud Act, as requested by plaintiff; ruled in favor of defendant, but refused to award attorney fees under FDUPTA. After concluding that FDUTPA and its fee award provision are applicable as substantive law of the forum state, the Eleventh Circuit certified questions to the Florida Supreme Court: Whether an offer of judgment may be viable when it purports to settle "all claims," even though it does not explicitly state whether the proposal includes attorneys' fees and whether fees are part of the legal claim; Whether the fee provision applies to a lawsuit seeking damages or, in the alternative, specific performance; Whether the fee-shifting provision applies to an action with the case's unique procedural history; and Whether the provision applies only to fees incurred during the seven months before the FDUTPA claim was defeated at summary judgment, or also to fees incurred during subsequent litigation.

Enron Creditors Recovery Corp. (Enron) sought to avoid and recover payments it made to redeem its commercial paper prior to maturity from appellees, whose notes were redeemed by Enron. On appeal, Enron challenged the district court's conclusion that 11 U.S.C. 546(e)'s safe harbor, which shielded "settlement payments" from avoidance actions in bankruptcy, protected Enron's redemption payments whether or not they were made to retire debt or were unusual. The court affirmed the district court's decision and order, holding that Enron's proposed exclusions from the reach of section 546(e) have no basis in the Bankruptcy Code where the payments at issue were made to redeem commercial paper, which the Bankruptcy Code defined as security. Therefore, the payments at issue constituted the "transfer of cash ... made to complete [a] securities transaction" and were settlement payments within the meaning of 11 U.S.C. 741(8). The court declined to address Enron's arguments regarding legislative history because the court reached its conclusion based on the statute's plain language.

An anti-dumping petition claimed that Chinese firms were exporting frontseating service valves at less than fair value. The Department of Commerce calculated normal value of the valves by using India as a surrogate market economy and identifying brass bars as a primary raw material; it valued the labor factor of production using regression analysis that included wage rates and gross national income data from sixty-one market economy countries. Commerce issued a final determination that calculated the surrogate value for brass bar without excluding the imports from Japan, France, and the UAE. The Court of International Trade upheld the determination. The Federal Circuit vacated and remanded for revaluation of labor, not using the regression approach, and reconsideration of sales at issue for calculating the relevant total dumping margin. Commerce’s reading of the evidence was reasonable in including data on imports from Japan, France, and the UAE, to calculate the surrogate value of brass bar.

In November 2001, the U.S. Department of Commerce issued an anti-dumping duty order on certain hot-rolled carbon steel flat products from Thailand, found that the company was selling the subject merchandise at less than normal value and assigned a dumping margin of 3.86%. In 2006 the order was partially revoked, as to the company, but remained in effect with respect to other exporters and producers. Commerce received a complaint that dumping had resumed and initiated changed circumstances review (CCR), despite the company's assertion that it lacked authority to so. The Court of International Trade (CIT) dismissed the company's suit for an injunction in 2009. Commerce reinstated the order with respect to the company; CIT affirmed. The Federal Circuit affirmed, holding that Commerce reasonably interpreted and acted on its revocation and CCR authority under 19 U.S.C. 1675(b, d) as permitting conditional revocation and reconsideration.

Plaintiff, an Illinois corporation, filed suit for conversion against a corporation based in South Korea and individuals. Although the defendants were served, there was no formal response. The individual defendants sent a letter asserting that they had no connection to the corporation and requesting dismissal. Several months later the court entered default judgment in the amount of $2,916,332. About a year later the defendants filed appearances and a motion to vacate for lack of personal jurisdiction. The district court denied the motion. The Seventh Circuit reversed and remanded. After noting that jurisdiction can be contested in the original proceeding or in a collateral action, the court concluded that the motion was not untimely. The letter did not constitute an appearance by the individuals and the corporation was not capable of making a pro se appearance. The defendants have submitted affidavits concerning whether they had "minimum contacts" with Illinois that must be considered by the court.

The holder of patents on an FDA-approved product that promotes eyelash growth claimed patent infringement and violation of California Business & Professions Code 17200 unfair competition provisions against companies marketing similar products. The district court dismissed the state law claims for lack of standing under an amendment to that law, enacted by the voters as Proposition 64. The Federal Circuit reversed and remanded. The complaint adequately alleged economic injury caused by defendants' unfair business practices; it is not necessary that the plaintiff had direct business dealings with the defendants.