Justia Commercial Law Opinion Summaries

The Department of Commerce conducted new shipper review, at Sea-line’s request, on an outstanding 1994 antidumping order on fresh garlic imports from China. New shipper review covers an importer or producer that was not subject to an initial antidumping duty investigation and thinks it is entitled to an individual anti-dumping duty margin, 19 U.S.C. 1675(a)(2), and covers imports after the review period for the initial investigation. Commerce conducted Sea-line’s review for the period of November 1, 2008 through April 30, 2009. Because China is a non-market economy, Commerce used surrogate values from a comparable market economy (India), relying on price data from the APMC Bulletin, which reports daily prices in India for garlic bulbs of various “grades.” Sea-line reported bulbs in the grade Super A category. The APMC Bulletin did not report any prices for grade Super A bulbs for the period of review. Commerce averaged the closest available data points for grade Super A garlic, which was for November 2007 through April 2008 and applied the Wholesale Price Index for India published by the International Monetary Fund. Commerce calculated a “surrogate financial ratio” for general expenses, overhead, and profit by averaging financial statements of two Indian tea producers, reasoning that "tea, rice, and vegetable processing is similar to garlic because each is not highly processed or preserved prior to sale.” The Court of International Trade affirmed the final results and assignment of an antidumping duty. The Federal Circuit affirmed, finding that the results were based on substantial evidence.View "Qingdao Sea-line Trading Co. v. United States" on Justia Law

Between 2009 and 2012, Sunshine and Purdy, a Kentucky dairy farmer, entered into “Dairy Cow Leases.” Purdy received 435 cows to milk, and, in exchange, paid monthly rent to Sunshine. Purdy’s business faltered in 2012, and he sought bankruptcy protection. Sunshine moved to retake possession of the cattle. Citizens First Bank had a perfected purchase money security interest in Purdy’s equipment, farm products, and livestock, and claimed that its perfected security interest gave Citizens First priority over Sunshine with regard to the cattle. Citizens argued that the “leases” were disguised security agreements, that Purdy actually owned the cattle, and that the subsequently-acquired livestock were covered by the bank’s security interest. The bankruptcy court ruled in favor of Citizens, finding that the leases were per se security agreements. The Sixth Circuit reversed, noting that the terms of the agreements expressly preserve Sunshine’s ability to recover the cattle. Whether the parties strictly adhered to the terms of these leases is irrelevant to determining whether the agreements were true leases or disguised security agreements. Neither the bankruptcy court nor the parties sufficiently explained the legal import of Purdy’s culling practices or put forward any evidence that the parties altered the terms of the leases making them anything but leases. View "In re: Purdy" on Justia Law

Plaintiff is the marketer, distributor, and seller of 5-hour ENERGY (FHE), an “energy shot,” which is an energy drink sold and consumed in small portions. Plaintiff began selling FHE in 2004. FHE was not the first energy shot on the market, but was the first to achieve widespread success and was unique in being marketed FHE to adults as a replacement for an afternoon cup of coffee or a caffeinated soda. Plaintiff submitted “5-hour ENERGY” for trademark registration with the Patent and Trademark Office, which rejected the application in January 2005, deeming the mark too descriptive to be eligible for protection. Plaintiff placed FHE on the Supplemental Register in September 2005 and secured a trademark for “5-hour ENERGY” in August 2011. Plaintiff also protected its mark and market position through litigation. Defendants have marketed dietary supplements since the mid-1990s. In 2008, defendants began to market and sell “6 Hour Energy Shot,” in a bottle resembling the FHE bottle. In a suit under the Lanham Act, 15 U.S.C. 1051, the district court found infringement of plaintiff’s trademark and trade dress, then entered an order of contempt after the defendants violated a permanent injunction entered. The Sixth Circuit affirmed.View "Innovation Ventures, LLC v. N2G Distrib., Inc." on Justia Law

GRK’s R4 Screws, RT Composite Trim Head Screws, and Fin/Trim Head Screws are made with corrosion-resistant case-hardened steel and are marketed for use as building material fasteners. R4 screws have a flat self- countersinking head designed to cut away at the top layer of the material as the screw is driven into place. RT and Fin/Trim screws are recommended for fine carpentry and trim applications, and have much smaller heads, designed to prevent cracking and splitting of the target material. GRK imported the subject screws between January and August 2008. U.S. Customs and Border Protection classified the screws at liquidation under the Harmonized Tariff Schedule of the U.S. (HTSUS) subheading 7318.12.00, “other wood screws,” which carries a 12.5% ad valorem duty. GRK protested, claiming that the screws should instead have been classified under subheading 7318.14.10, “self-tapping screws,” subject to a 6.2% ad valorem duty. Customs denied GRK’s protests. The Court of International Trade noted that HTSUS does not specifically define either subheading and agreed with GRK that the items were properly classified as “self-tapping screws.” The Federal Circuit vacated and remanded, reasoning that the Trade Court refused to consider the use of the screws at any step of determining the classification. View "GRK Canada, Ltd. v. United States" on Justia Law

Plaintiff-school opened a bank account for its operating fund with Defendant-bank. One of Plaintiff’s employees later opened a bank account with Defendant that Plaintiff had not authorized and deposited into that account several hundred checks originating from, or intended to be deposited into, Plaintiff’s bank account with Defendant. Over the course of approximately four years, the employee deposited $832,776 into this bank account and withdrew funds just short of that amount. Defendant refused Plaintiff’s demand to return the funds that the employee had funneled through this account to himself. Thereafter, Plaintiff commenced this action, alleging breach of contract, violations of the Uniform Commercial Code (UCC), negligence, and common law conversion. The trial court rendered judgment in favor of Plaintiff on each of the counts and awarded $832,776 in total compensatory damages. The Supreme Court affirmed in all respects with the exception of the damages award, holding that some of Plaintiff’s claims under the UCC were time barred and that the trial court did not otherwise err in its judgment. Remanded with direction to reduce the award by $5,156 and to proportionately reduce prejudgment interest, . View "Saint Bernard Sch. of Montville, Inc. v. Bank of Am. " on Justia Law

Coastal filed suit against Chase Bank, asserting claims of conversion and negligence under the Texas Uniform Commercial Code (UCC) and money had and received under the common law. At issue on interlocutory appeal was whether section 3.405 of the UCC can serve as an affirmative defense to a common law "money and received" claim and whether settlement credits in Texas reduce the nonsettling defendant's liability rather than the plaintiff's total loss. The court concluded that the money had and received claim as applied in this situation must simply incorporate the affirmative defense provided by section 3.405. Therefore, the district court did not err in its determination that section 3.405 could so be applied. Further, the district court was correct in holding that the settlement credit should be applied to reduce the nonsettling defendant's liability, not the plaintiff's total loss. On remand, however, the district court must give Coastal an opportunity to demonstrate that allocation of the settlement amount is appropriate. Accordingly, the court affirmed and remanded for further proceedings. View "Coastal Agricultural Supply v. JP Morgan Chase Bank, N.A." on Justia Law

SB1 Waukesha County, LLC and Decade Properties, Inc. were two judgment creditors of defendant Jack Collier. SB1 purchased from Associated Bank, N.A. a portion of a default judgment against Collier. Subsequently, Decade obtained a judgment against Collier personally. Each party claimed that they were entitled to collect on Collier’s personal property. The Supreme Court held (1) because SB1 was the first judgment creditor with a docketed money judgment to levy specific, non-exempt personal property of Collier, SB1 had priority over Decade in regard to specific personal property that SB1 identified and levied; but (2) there was no blanket lien in favor of SB1 or Decade that prevented other creditors from pursuing collection from Collier’s personal property. View "Associated Bank N.A. v. Collier" on Justia Law

Defendants, Heartland Wisconsin Corp. and Town Bank, were creditors of a Milwaukee real estate investor and landlord (Debtor). The issue in this case was which defendant had priority over proceeds of the Debtor’s legal malpractice claim that was held in escrow pending resolution of their dispute. Heartland claimed that the Debtor validly assigned the proceeds of his legal malpractice claim, which gave Heartland a security interest in those proceeds that was superior to Town Bank’s interest. Town Bank claimed that it obtained a superior interest in the proceeds by levy and that proceeds from legal malpractice claims are not assignable. The Supreme Court concluded (1) the debtor lawfully assigned the potential proceeds from his legal malpractice claim as collateral for a debt to Heartland; and (2) Heartland perfected a security interest in the proceeds before Town Bank obtained a superior interest in the proceeds, and therefore, Heartland was entitled to the proceeds. View "Attorney's Title Guar. Fund, Inc. v. Town Bank" on Justia Law

Bill Head, doing business as Bill Head Enterprises (Head), hired Petroleum Solutions, Inc. to manufacture and install an underground fuel system at the truck stop Head owned and operated. After a major diesel-fuel leak occurred, Respondents sued Petroleum Solutions for its damages. The trial rendered judgment in favor of Head and in favor of third-party defendant Titeflex, Inc., the alleged manufacturer of a component part incorporated into the fuel system, on Titeflex’s counterclaim against Petroleum Solutions for statutory indemnity. The court of appeals affirmed. The Supreme Court (1) reversed the judgment as to Head, holding that the trial court abused its discretion in imposing the sanctions of charging the jury with a spoliation instruction and striking Petroleum Solutions’ statute-of-limitations defense, and the trial court’s abuse of discretion was harmful; and (2) affirmed the judgment as to Titeflex’s indemnity claim, holding that Titeflex was entitled to statutory indemnity from Petroleum Solutions. Remanded for further proceedings between Respondents and Petroleum Solutions. View "Petroleum Solutions, Inc. v. Head" on Justia Law

Burzlaff bought a “Stallion” motorized tricycle from Thoroughbred Motorsports in 2009 for $35,000. When Burzlaff reported the first problems to Thoroughbred, the company instructed him to take his vehicle to a Ford dealer for warranty repairs. Burzlaff did so repeatedly. After the vehicle had been out of service for repairs for 71 days during the first year, Burzlaff demanded, under the Wisconsin Lemon Law, that Thoroughbred replace the vehicle or refund his purchase price. Thoroughbred refused. Further efforts to repair the vehicle at the Thoroughbred factory in Texas failed to correct the defects. Burzlaff sued Thoroughbred under the federal Magnuson-Moss Warranty Act, 15 U.S.C. 2301, and the Wisconsin Lemon Law, Wis. Stat. 218.0171. The district court awarded double damages plus costs and attorney fees for a total judgment of $95,000 under the more generous provisions of the state law. The Seventh Circuit affirmed, rejecting challenges to the jury instructions on the Lemon Law claim, the sufficiency of the evidence on that claim, and the submission of the Magnuson-Moss claim to the jury. View "Burzlaff v. Thoroughbred Motorsports Inc." on Justia Law