Justia Commercial Law Opinion Summaries

NewSpin's “SwingSmart” product is a sensor module that attaches to sports equipment and analyzes the user’s swing technique, speed, and angle. Arrow representatives met with NewSpin several times in 2010-2011; NewSpin believed that Arrow knew how SwingSmart would function and understood its specifications. Arrow represented that Arrow had “successfully manufactured and provided substantially similar components for other customers.” NewSpin signed a contract with Arrow in August 2011. Arrow shipped some components to NewSpin in mid-2012. NewSpin alleges that those components were defective and did not conform to specifications. NewSpin used Arrow’s defective components to build 7,500 units; only 3,219 could be shipped to customers and, of those units, 697 were wholly inoperable. NewSpin paid Arrow $598,488 for these defective components and spent $200,000 for customer support efforts, testing, and repair, and that the defective components damaged its brand equity, reputation, and vendor relationships. The district court dismissed NewSpin’s January 2017 complaint as untimely, reasoning the Agreement was predominantly a contract for the sale of goods subject to the UCC’s four-year statute of limitations. The Seventh Circuit affirmed with respect to the contract-based claims and the unjust enrichment and negligent misrepresentation claims, which are duplicative of the contract claims. The court reversed the dismissal of fraud claims, applying Illinois’s five-year limitations period. As to procedural matters, the law of the forum controls over the contract's choice of law provision. View "NewSpin Sports, LLC v. Arrow Electronics, Inc." on Justia Law

Sleepyʹs purchased beds from the Select Comfort for resale in Sleepyʹs stores and suspected that Select Comfort was disparaging Sleepyʹs stores and the particular line of Select Comfort beds it sold. Sleepy’s sued, alleging slander per se, breach of contract, unfair competition, breach of the implied covenant of good faith and fair dealing, and the Lanham Act. After a bench trial, the district court dismissed. On remand, a different district judge entered a judgment for Select Comfort on the merits and concluded that attorneyʹs fees were warranted because the case was ʺexceptionalʺ under the Lanham Act. The Second Circuit vacated the dismissal of Sleepyʹs slander claims. That dismissal had been on the ground that the publication element cannot be met under New York law when the statement in question is only made to the plaintiffʹs representatives--”secret shoppers” sent into Select Comfort stores by Sleepy’s. The Second Circuit remanded for a determination of whether the plaintiff consented to the slanderous statements by engaging the secret shoppers. The district court was directed to apply the “Octane Fitness” standard for evaluating whether a Lanham Act claim is ʺexceptional.ʺ The district court erred by not sufficiently explaining or justifying the amount of the defendantsʹ attorneyʹs fees. View "Sleepy's LLC v. Select Comfort Wholesale Corp." on Justia Law

The Supreme Court vacated the judgment of the intermediate court of appeals (ICA) affirming the circuit court’s order and granting summary judgment for Defendant in this case arising out of the uncompleted sale of one business to another, holding that the plaintiff raised genuine issues of material fact as to its unfair method of competition (UMOC) claim.Specifically, the Court held (1) to raise an issue of material fact as to the nature of the competition requirement of a UMOC claim following the close of discovery, a plaintiff must demonstrate that the defendant’s alleged anticompetitive conduct could negatively affect competition, but the plaintiff need not prove that the defendant in fact harmed competition; (2) to survive summary judgment, a plaintiff may generally describe the relevant market without resort to expert testimony and need not be a competitor of or in competition with the defendant; and (3) the plaintiff in this case raised genuine issues of material fact as to the first and second elements of a UMOC claim, and the circuit court erred erred in holding that the plaintiff was estopped from asserting the UMOC claim based on waiver, judicial estoppel and collateral estoppel. View "Field v. National Collegiate Athletic Ass’n" on Justia Law

In 2007, OFTI sold a mill to TAK. During the financial crunch, Goldman Sachs cut $19 million from the financing. OFTI had promised clean title, but with the reduced financing, was unable to pay off all security interests. TAK agreed to issue negotiable notes, aggregating about $16 million, to OFTI, which would offer them as substitute security. The creditors accepted the notes. The transaction closed. OFTI promised to pay the notes. The lenders who released their security had the credit of both companies behind the notes. TAK was to hire an OFTI construction firm to build new mills; if TAK did not arrange for this construction and did not pay the notes, OFTI could cancel the notes and acquire a 27% interest in TAK. Neither paid the notes. The new mills did not materialize. OFTI demanded a 27% equity interest in TAK. Some formerly secured creditors have not been paid and retain promissory notes; OFTI does not possess any of the notes. The Seventh Circuit affirmed the denial of relief. A hold-harmless agreement effectively prevents OFTI from enforcing the notes against TAK; whatever TAK gave to OFTI would be returned in indemnification. The notes were designed as security for third parties, not as compensation for OFTI. Additionally, under Wisconsin’s UCC applicable to negotiable instruments, OFTI is not entitled to enforce the notes because it is not their holder, is not in possession of them, and is not entitled to enforce them under specified sections. If OFTI could use nonpayment as a reason to cancel the notes, they would be worthless to the creditors. View "Tissue Technology LLC v. TAK Investments LLC" on Justia Law

The Supreme Court affirmed the order of the postconviction court dismissing the postconviction proceedings brought by Appellant, a prisoner under sentence of death, but not discharging counsel, holding that the postconviction court’s order was not erroneous.Appellant was convicted by a jury of first-degree murder, kidnapping, and sexual battery. The jury recommended sentence of death by a vote of seven to five, and the trial court imposed a sentence of death. The Supreme Court affirmed. Thereafter, Appellant filed a motion to vacate judgments of conviction and sentence of death pursuant to Fla. R. Crim. P. 3.851. After concluding that Appellant sought to waive the postcondition proceedings, the postconviction court dismissed the postconviction motion. The Supreme Court affirmed, holding that the postconviction court did not abuse its discretion in determining that Appellant’s waiver was knowing, voluntary, and intelligent, and therefore, valid, and the postconviction court properly allowed Appellant to waive the instant proceedings while maintaining counsel. View "Davis v. State" on Justia Law

The First Circuit affirmed in part, reversed in part, and vacated in part the district court’s entry of summary judgment in favor of American Honda Finance Corporation (Honda) on Plaintiff’s putative class action alleging that Honda violated Massachusetts consumer protection laws, holding that summary judgment was improper on some of Plaintiff’s claims.Plaintiff claimed that Honda afforded her inadequate loan-deficiency notifications after she fell behind on her automobile-loan payments. Because Plaintiff’s claims hinged entirely on questions of Massachusetts law, the First Circuit certified three questions to the Massachusetts Supreme Judicial Court (SJC). After the SJC issued an opinion responding to these questions and the parties filed supplemental briefs, the First Circuit issued this opinion. The Court held (1) Plaintiff’s challenge to the district court’s ruling that Honda sold her car for fair market value was waived; (2) the district court erred in finding that the post-repossession and post-sale notices Honda sent to Plaintiff complied with the requirements of Massachusetts law; and (3) therefore, entry of summary judgment on Plaintiff’s Mass. Gen. Laws ch. 106, 9-614 and 9-616 notice and Mass. Gen. Laws ch. 93A, 2(A) claims was improper. View "Williams v. American Honda Finance Corp." on Justia Law

The Supreme Court accepted a certified question from the United States Court of Appeals for the Seventh Circuit and answered that online fantasy sports operators that condition entry to contests on payment and distribute cash prizes do not violate the Indiana right of publicity statute when those organizations use the names, pictures, and statistics of players without their consent.At issue was Indiana’s right of publicity statute, Ind. Code 32-36-1-8(a), which provides that “a person may not use an aspect of a personality’s right of publicity for a commercial purpose…without having obtained previous written consent.” Plaintiffs, collegiate student althetes, filed this class action complaint alleging that Defendants, DraftKings, Inc. and FanDuel, Inc., used their names and likenesses in operating online fantasy sports contest without their consent, in violation of their right of publicity. The district court dismissed the suit. Plaintiffs appealed, and the Seventh Circuit Court of Appeals certified a question of Indiana law to the Supreme Court. The Court answered that Indiana’s right of publicity statute contains an exception for “material that has newsworthy value” that includes online fantasy sports operators’ use of college players’ names, pictures, and statistics for online fantasy sports. View "Daniels v. FanDuel, Inc." on Justia Law

Connecticut imposed liability for breaches of contract when attended by deception. Unhappy with flanges purchased under a contract with PM Engineered Solutions, Inc. (“Powdered Metal”), Bosal Industries-Georgia, Inc. (“Bosal”) decided to switch suppliers and terminate the contract. After a five-day bench trial, the district court found that the termination was not only wrongful in breach of the contract, but that it was deceptive in violation of the Connecticut Unfair Trade Practices Act. Because Connecticut law applied and the district court’s findings rested on a permissible view of the evidence, the Sixth Circuit affirmed except as to the calculation of postjudgment interest on damages. View "Premium Freight Mgmt. v. PM Engineered Solutions" on Justia Law

Exel, a shipping broker, sued SRT, an interstate motor carrier, after SRT lost a load of pharmaceuticals owned by Exel’s customer, Sandoz, that was being transported from Pennsylvania to Tennessee. After nearly seven years of litigation, including a prior appeal, the district court entered judgment for Exel and awarded it the replacement cost of the lost pharmaceuticals, approximately $5.9 million. SRT argued that the district court erred in discounting bills of lading that ostensibly limited SRT’s liability to a small fraction of the shipment’s value. Exel argued that the court erred in measuring damages by the replacement cost of the pharmaceuticals rather than by their higher market value. The Sixth Circuit affirmed. Exel and SRT had a Master Transportation Services Agreement (MTSA), which stated that any bill of lading “shall be subject to and subordinate to” the MTSA; that SRT “shall be liable” to Exel for any “loss” to commodities shipped pursuant to the agreement; and that the “measurement of the loss . . . shall be the Shipper’s replacement value.” The Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. 14706 “puts the burden on the carrier to demonstrate that the parties had a written agreement to limit the carrier’s liability, irrespective [of] whether the shipper drafted the bill of lading.” SRT did not carry its burden to show that it effectively limited its liability. View "Exel, Inc. v. Southern Refrigerated Transport, Inc." on Justia Law

JTE, distributed products for Bimbo around Chicago under an agreement with no fixed duration that could be terminated in the event of a non-curable or untimely-cured breach. New York law governed all disputes. According to JTE, Bimbo began fabricating curable breaches in 2008 in a scheme to force JTE out as its distributor and install a less-costly distributor. Bimbo employees filed false reports of poor service and out-of-stock products in JTE’s distribution area and would sometimes remove products from store shelves, photograph the empty shelves as “proof” of a breach, and then return the products to their shelves. Once, a distributor caught a Bimbo manager in the act of fabricating a photograph. Bimbo assured JTE that this would never happen again. In 2011, Bimbo unilaterally terminated JTE’s agreement, citing the fabricated breaches, and forced JTE to sell its rights to new distributors. JTE claims that it did not learn about the scheme until 2013-2014. The district court dismissed JTE’s suit for breach of contract and tortious interference. The Seventh Circuit affirmed. Under the primary-purpose test, the agreement qualifies as a contract for the sale of goods, governed by the UCC’s four-year statute of limitations, not by the 10-year period for other written contracts. With respect to tortious interference, the court reasoned that JTE knew about the shelving incidents and should not have “slumber[ed] on [its] rights” until it determined the exact way in which it was harmed. View "Heiman v. Bimbo Foods Bakeries Distribution Co." on Justia Law