Justia Commercial Law Opinion Summaries

Appellant Farmers National Bank (FNB) appealed the district court's grant of declaratory judgment in favor of Green River Dairy, LLC, and four commodities dealers: Ernest Carter, Lewis Becker, Jack McCall, and Hull Farms (Sellers). FNB argued the district court misinterpreted I.C. 45-1802 (a statutory lien provision) and as a result, erred in granting Sellers a priority lien on collateral securing a loan previously made by FNB. Upon review, the Supreme Court agreed with FNB about the misinterpretation and vacated the district court's grant of declaratory judgment in favor of the Sellers. View "Farmers Nat'l Bank v. Green River Dairy" on Justia Law

Bank loaned money to Debtor to purchase a vehicle. The loan was secured by a security interest in the vehicle that was recorded in the Kansas Department of Revenue’s (KDOR) digital records and noted on an electronic certificate of title issued in Debtor’s name. Debtor later defaulted on its loan. That same year, Debtor’s former employer (Company) obtained a money judgment against Debtor in an unrelated action and obtained a court order authorizing the attachment of the vehicle. Purchaser, the sole owner of Company, subsequently purchased the vehicle at auction. Thereafter, Bank filed suit against Company and Purchaser (collectively, Defendants), seeking, among other things, a declaratory judgment that its perfected purchase money security interest was superior to any interests held by Defendants. The district court granted summary judgment for Bank and awarded Bank the proceeds of the sale of the vehicle. The court of appeals affirmed in relevant part. The Supreme Court affirmed, holding that the court of appeals correctly considered and applied perfection and priority rules under the Uniform Commercial Code to conclude that Purchaser did not take free and clear of Bank’s security interest. View "Stanley Bank v. Parish" on Justia Law

After receiving petitions from the Coalition, the U.S. Department of Commerce initiated antidumping (19 U.S.C. 1673) and countervailing duty (19 U.S.C. 1671) investigations covering utility scale wind towers from China and an antidumping investigation covering Vietnam. The U.S. International Trade Commission issued a preliminary determination that there was a reasonable indication of threat of material injury to a domestic industry by reason of the imports. Commerce issued a preliminary affirmative countervailing duty determination with respect to imports from China and preliminary affirmative antidumping duty determinations with respect to imports from China and Vietnam. Commerce instructed Customs and Border Protection to suspend liquidation of all entries of the subject merchandise and require cash deposits for the entries. Commerce then made final affirmative determinations. ITC issued a final affirmative determination in an evenly-divided vote, but of the six Commissioners on the panel, three found neither material injury nor threat of injury, two determined that the industry had suffered present material injury, and a third determined that the domestic industry was threatened with material injury, but that the domestic industry would not have suffered material injury in the absence of the provisional measures. Commerce then issued antidumping and countervailing duty orders. Commerce applied the “Special Rule,” 19 U.S.C. 1671e(b)(2) and 1673e(b)(2), making the orders effective prospectively from the publication of the ITC Determination. The orders indicated that Commerce would instruct Customs to terminate the suspension of liquidation and refund deposits made before the publication date of the ITC Determination. The Court of International Trade denied the Coalition’s motions for injunctions. The Federal Circuit affirmed. View "Wind Tower Trade Coal. v. United States" on Justia Law

New Energy operated a South Bend ethanol plant. In bankruptcy, it proposed to sell assets by auction, which was held in 2013. A joint venture, New Energy, submitted the winning bid of $2.5 million. New Energy, the trustee, and the Department of Energy, the largest creditor, asked the bankruptcy court to confirm this result. Natural Chem, which had not participated in the auction, opposed confirmation, arguing that establishment of the joint venture amounted to collusion. The Bankruptcy Court confirmed the sale. Natural Chem did not seek a stay and the sale closed. A district judge affirmed, observing that after the closing only a protest by the trustee permits a sale to be undone on grounds that “the sale price was controlled by an agreement among potential bidders,” 11 U.S.C.363(n). The Seventh Circuit affirmed, concluding that Natural Chem did not suffer an injury and that, under section 363, any injury would not be redressable. Collusion is a form of monopsony that depresses the price realized at auctions and would have made it easier for Natural Chem to secure the property. A reduction in the bid would have harmed New Energy’s creditors, not Natural Chem, which is why the trustee rather than a bidder is the right party to protest collusive sales. View "In re: New Energy Corp." on Justia Law

Contractors Cargo, engaged in heavy-haul operations, commissioned Empire Bucket to fabricate a steel deck to be used with Cargo’s specialized rail freight car for transporting oversized loads. A third party designed the deck, specifying that the deck be fabricated from T-1 high-strength steel and that welding be performed to American Welding Society specifications. The deck was designed to transport up to 800,000 pounds. Empire fabricated the deck, which passed inspection by an outside agency and all nondestructive tests, and delivered it. Cargo connected the deck to its railcar and loaded it to 820,000 pounds. The next morning, an employee observed that the deck had dropped about three inches. Cargo attempted to raise it with a hydraulic jacking system, but the deck fractured. Cargo hired a metallurgical engineer, who determined that a portion of the weld was composed of material with properties different from the properties of the material in the rest of the weld where the crack originated. Cargo refused to pay the full purchase price. Empire sued and Cargo filed counterclaims. The district court granted Empire’s motion in limine to exclude testimony concerning one test performed on the deck after it failed. The jury returned a verdict for Empire. The Seventh Circuit affirmed, stating that, given testimony admitted at trial, the excluded evidence would have added little to the implied warranty claims. View "Empire Bucket, Inc. v. Contractors Cargo Co." on Justia Law

Kentucky law prohibits businesses that sell substantial amounts of staple groceries or gasoline from applying for a license to sell wine and liquor, Ky. Rev. Stat. 243.230(7). A regulation applies the prohibition to retailers that sell those items at a rate of at least 10% of gross monthly sales. A group of grocers sued the Kentucky Department of Alcoholic Beverage Control, alleging that the law irrationally discriminated against them in violation of state and federal equal-protection rights; that it violated state separation-of-powers principles by granting the administrative board unfettered discretion to define the law; and that it violated state and federal due process rights by vaguely defining its terms. A liquor store intervened as a defendant. The district court granted summary judgment to the grocers on the federal equal-protection claim but rejected the other claims. The Sixth Circuit reversed in part, upholding the statute. Applying the rational basis test, the court reasoned that the statute conceivably seeks to reduce access to high-alcohol products, and offends neither separation of powers nor due process principles. View "Maxwell's Pic-Pac, Inc. v. Dehner" on Justia Law

Shapiro, a U.S. affiliate of Aifudi, imports laminated woven sacks manufactured and exported by Aifudi in the People’s Republic of China (PRC). In 2008, the Department of Commerce found that those sacks were being sold in the U.S. at less than fair market value (19 U.S.C. 1673) and issued an antidumping-duty order. Aifudi participated, submitted verified information, and demonstrated that it was not subject to government control. Aifudi was assigned a “separate rate” of 64.28 percent, not the default PRC-wide rate. In a later review, conducted at Aifudi’s request, of the amount of the duty for a defined period, Commerce considered Aifudi’s eligibility for a company-specific rate for that period. Commerce published preliminary results, favorable to Aifudi. Aifudi immediately withdrew from the proceeding and removed its confidential information from the record. Commerce concluded that the record no longer contained enough verifiable information to prove that Aifudi was not subject to government control and assigned Aifudi the default PRC-wide rate for the review period. Shapiro appealed. The Court of International Trade upheld the decision. The Federal Circuit affirmed, concluding that Commerce’s decision to apply the PRC-wide rate to Aifudi was supported by substantial evidence and did not violate any law.View "AMS Assocs., Inc. v. United States" on Justia Law

Newman Park, LLC was formed for the sole purpose of developing a piece of property. In 2004, it took out a loan to purchase the property at issue in this suit. In 2008, without knowledge of the other owners in Newman Park, one member went to Columbia Community Bank and requested a loan for his 95%-owned company, Trinity. Trinity had nothing to do with Newman Park, but the Bank's loan to Trinity was secured by a second deed of trust on the Newman Park property. The issue before the Supreme Court in this case was whether the Bank, who was tricked into refinancing the property that the borrower lacked authority to pledge as security, could benefit from equitable subrogation when that Bank had no preexisting interest in the property. The property-owner/debtor argued that the Bank's lack of the preexisting interest barred it from equitable subrogation because of the "volunteer rule" which would characterize it as an intermeddler. The Court rejected the volunteer rule as a bar to equitable subrogation. The Court affirmed the appellate court which held that the defrauded Bank was entitled to be equitably subrogated as first priority lienholder.View "Columbia Cmty. Bank v. Newman Park, LLC" on Justia Law

Until 2001 Dean and Suiza competed to process and sell bottled milk to retailers. Suiza was the largest U.S. processor of milk and Dean was the second largest. Both purchased raw milk from other entities. DFA, a dairy farmer cooperative, was Suiza’s primary supplier and business partner. Dean obtained its raw milk predominantly from independent farmers. Dean and Suiza merged in 2001, becoming Dean Foods, hoping to obtain “distribution efficiencies and economies of scale,” for millions of dollars in cost savings. Certain agreements were negotiated, with input from the Department of Justice, which approved the proposed merger, subject to divestment of particular milk processing plants. Retailers of processed milk sued, charging violation of 15 U.S.C. 1, the Sherman Antitrust Act, by conspiring with a raw milk supplier-milk processor and the purchaser of the divested processing facilities to divide markets and restrict output. The district court granted summary judgment in favor of Dean Foods, finding insufficient proof of injury and failure to establish the relevant antitrust geographic market, primarily because plaintiff’s expert’s testimony was excluded. The Sixth Circuit reversed and remanded, holding that the expert should not have been excluded and that the conclusions regarding injury were based on flawed propositions. View "Food Lion, LLC v. Dean Foods Co." on Justia Law

Levi Strauss has stitched the back pocket of its jeans with the “Arcuate” design since 1873 and holds multiple trademarks on the design. In 2005, Abercrombie sought to register a “mirror image stitching design” for use on clothing, stating no limitations on the goods’ nature, type, channels of trade, or class of purchasers. Levi Strauss initiated an opposition to the parent application (concerning jackets and seeking Principal Registration). Levi Strauss petitioned to cancel Supplemental Registration of the child application covering other clothing. Abercrombie began selling “Ruehl jeans” with the design. Levi Strauss sued. The PTO stayed proceedings. Abercrombie claimed that its products were sold in different channels, at different prices. A jury found no infringement; the court rejected a claim of dilution by blurring. Levi Strauss did not appeal concerning infringement. The Ninth Circuit remanded, holding that dilution by blurring does not require identity or near identity of marks. Meanwhile, Abercrombie shut down the Ruehl brand, but sought to register its mirror-image design on “clothing, namely bottoms,” disclosing use of the design on denim shorts sold as “Gilley Hicks,” at different prices, and through different channels. Levi Strauss sought to amend to include the Gilley Hicks products. The district court declined and dismissed the dilution claim. The PTO opposition and cancellation proceedings were dismissed on the ground of issue preclusion. The Federal Circuit reversed, reasoning that the registrations at issue in the PTO cover a broader range of uses than were the subject of the litigation. View "Levi Strauss & Co. v. Abercrombie & Fitch Trading Co." on Justia Law