Justia Commercial Law Opinion SummariesArticles Posted in US Court of Appeals for the First Circuit
Wheeling & Lake Erie Railway Co. v. Keach
In this case, a byproduct of litigation stemming from the derailment of a Montreal, Maine & Atlantic Railway, Ltd. (MMA) freight train carrying crude oil in Lac-Megantic, Quebec, the First Circuit affirmed the district court's entry of judgment in favor of Robert Keath, the estate representative of MMA, and against creditor Wheeling & Lake Erie Railway Company, holding that, giving due deference to the fact-finder's resolution of the burden of proof, the judgment must be affirmed.One month after the derailment, MMA filed a voluntary petition for protection under Chapter 11 of the Bankruptcy Code. Wheeling instituted an adversary proceeding in the bankruptcy court against MMA and the estate representative, seeking a declaratory judgment regarding the existence and priority of its security interest in certain property of the MMA estate. The case involved intricate questions concerning secured transactions, carriage of goods, and corporate reorganization. After a settlement, the bankruptcy court ruled in favor of the estate representative. The First Circuit affirmed, holding (1) ultimately, this case turned on principals relating to the allocation of the burden of proof and the deference due to the finder of fact; and (2) giving due deference to the fact-finder's resolution of the burden of proof issue, the district court's judgment must be affirmed. View "Wheeling & Lake Erie Railway Co. v. Keach" on Justia Law
AcBel Polytech, Inc. v. Fairchild Semiconductor International, Inc.
In this case involving an electronic component, a voltage regulator known as the KA7805, the First Circuit affirmed in part and vacated in part the district court's judgment dismissing Plaintiff's claims against Defendant, holding that the district court erred in dismissing three of Plaintiff's claims.Defendant's subsidiaries manufactured the KA7805. Plaintiff purchased KA7805s from Defendant's agent and then installed them into power supply units (PSU) it subsequently sold. When one of Defendant's subsidiaries began to manufacture a new "shrunk-die" version of the KA7805, problems with the PSUs arose. Plaintiff brought this suit against Defendant and its holding company, asserting several claims. The district court dismissed all claims except those involving breach of implied warranty at the summary judgment stage. After a trial, the district court dismissed the remaining claims. The First Circuit held (1) the district court erred in summarily dismissing Plaintiff's fraudulent misrepresentation claim based on its holding that Plaintiff's reliance on an uncharged part number was unreasonable as a matter of law; and (2) because the district court's basis for dismissal of Plaintiff's fraudulent omission and negligent misrepresentation claim also rested on its erroneous holding, the court erred in dismissing these two claims as well. View "AcBel Polytech, Inc. v. Fairchild Semiconductor International, Inc." on Justia Law
Starr Surplus Lines Insurance Co. v. Mountaire Farms Inc.
The First Circuit affirmed the judgment of the district court granting Defendant's motion to dismiss this suit brought by the insurer (Insurer) of a chicken products manufacturer seeking damages from the manufacturer's chicken supplier (Supplier) for claims under Maine law of breach of warranty and strict product liability, holding that the district court did not err in dismissing the claims.Insurer sought to recoup the money it paid to the manufacturer for the losses the manufacturer incurred when its products were recalled following a salmonella outbreak. Insurer's complaint against Supplier alleged that the manufacturer received raw chicken from Supplier that was contaminated with salmonella and was therefore defective under Maine law. The district court dismissed all claims, concluding that the allegations in the complaint did not plausibly allege that the raw chicken sent by Supplier to the manufacturer was defective and that the strict liability claim was independently barred by the economic loss doctrine. The First Circuit affirmed, holding (1) as to the breach of warranty claims, Insurer failed to plausibly allege that the raw chicken at issue was contaminated with a type of salmonella that would persist despite proper cooking; and (2) Insurer's strict liability claim was properly dismissed because the complaint failed to allege facts that could suffice to show that the chicken was defective. View "Starr Surplus Lines Insurance Co. v. Mountaire Farms Inc." on Justia Law
Williams v. American Honda Finance Corp.
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
Williams v. American Honda Finance Corp.
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