Justia Commercial Law Opinion Summaries

Amkor initiated an International Trade Commission investigation, based on the importation, sale for importation, and sale within the U.S. after importation of certain encapsulated integrated circuit devices that allegedly infringed patent claims The Commission determined that the patent was invalid under 35 U.S.C. 102(g)(2). The Federal Circuit reversed. Evidence establishing that there might have been a prior conception is not sufficient to meet the clear and convincing burden needed to invalidate a patent. View "Amkor Tech., Inc. v. Int'l Trade Comm'n" on Justia Law

Petitioner appealed from a decision of the United States tax court concluding that he owed $128,292 in income tax for the 2004 taxable year. Petitioner entered into an agreement with Optech Limited pursuant to which he transferred floating rate notes (FRNs) worth approximately $1 million to Optech in return for a nonrecourse loan of ninety percent of the FRNs' value. The agreement gave Optech the right to receive all dividends and interest on the FRNs and the right to sell the FRNs during the loan term without Petitioner's consent. Instead of holding the FRNs as collateral for the loan, Optech sold the FRNs and transferred ninety percent of the proceeds to Petitioner. Petitioner did not report that he had sold the FRNs in his 2004 federal income tax return. The Ninth Circuit Court of Appeals affirmed the decision of the tax court, holding that Petitioner's transaction with Optech constituted a sale for tax purposes despite its taking the form of a loan because the burdens and benefits of owning the FRNs were transferred to Optech. View "Sollberger v. Comm'r of Internal Revenue" on Justia Law

Plaintiffs are wholesalers of beer and wine; each acted as the exclusive distributor of Miller and/or Coors brands within a defined territory under written franchise agreements. In 2007, Miller and Coors entered a Joint Venture agreement, contemplating creation of MillerCoors, restructured their respective businesses and assets, and assigned distribution agreements to the Joint Venture. MillerCoors notified the plaintiffs that it intended to terminate their distribution rights as a successor manufacturer under Ohio Rev. Code 1333.85(D). The district court found that MillerCoors is not a “successor manufacturer” under Ohio law because it is controlled by Miller and Coors, and that the Act, therefore, prohibits MillerCoors from terminating the distributorships. The Sixth Circuit affirmed. Miller and Coors exercise control over MillerCoors through their equal voting power, veto power, the appointment of directors, all of whom are present officers or employees of the joint venture partners, and who owe their fiduciary duty only to Miller or Coors, their influence over the executive team, and their funding of MillerCoors. Even under the manufacturers’ proposed definition of “control,” the evidence shows that Miller and Coors together retain the power to “direct, superintend, restrict, govern, [and] oversee” MillerCoors. View "Beverage Distrib., Inc. v. Miller Brewing Co." on Justia Law

Shell imported petroleum products, 1993-1994, upon which custom duties, taxes, and other fees were paid. During the same period, Shell exported drawback-eligible substitute finished petroleum derivatives. In 1995-1996, substitution drawback claims were filed with the U.S. Customs and Border Protection on Shell’s behalf. Generally, Customs provides a drawback of 99% of any duty, tax, or fee imposed under federal law upon entry or importation if the merchandise (or a commercially interchangeable substitute) is subsequently exported or destroyed under Customs supervision and not used within the U.S. before exportation or destruction, 19 U.S.C. 1313(j),(p). Drawback claims must be filed within three years of exportation. During the time of Shell’s imports, drawback eligibility of Harbor Maintenance Tax and Environmental Tax payments, which Shell now seeks, were heavily disputed. Shell was found not to have included an express request for HMT and ET in the “net claim” figure. In 1997, after the three-year period for the filing of drawback claims had expired Shell filed protests with Customs, seeking drawback as to HMT and ET payments. Customs denied Shell’s protests. The Court of International Trade found the claims time-barred. The Federal Circuit affirmed, holding that 1999 and 2004 statutory amendments did not change Shell’s position. View "Shell Oil Co. v. United States" on Justia Law

The Scotts Company, an Ohio LLC, brought a diversity action against Seeds, Inc., a Washington corporation, in federal district court. Thereafter, Millhorn Farmers, Maple Leaf Farms, Mica Creek, and Tim Freeburg (Growers) sued Seeds and Scotts in Washington state court. Maple Leaf Farms and Mica Creek were Washington corporations, Millhorn Farms was an Idaho corporation, and Tim Freeburg was a citizen of Idaho. Scotts subsequently filed an amended complaint in federal court adding the Growers as defendants and seeking declaratory relief. The district court subsequently realigned the Growers and plaintiffs and Seeds and Scotts as defendants and held, alternatively, that it would stay the federal proceedings in favor of the related state court proceedings under either the Brillhart doctrine or the Colorado River doctrine. Because the parties' realignment resulted in the absence of complete diversity of citizenship between defendant Seeds and newly-aligned plaintiffs-Growers, the district court dismissed the action for lack of subject matter jurisdiction. The Ninth Circuit Court of Appeals reversed, holding that the district court should not have declined to entertain the claim for declaratory relief under the Brillhart doctrine, and instead, the claims should have been evaluated under the Colorado River doctrine. Remanded. View "Scotts Co., LLC v. Seeds, Inc." on Justia Law

In 2004 Ford owned the British car maker Jaguar. In 2004 and 2005, Ford imported Jaguar-brand cars. On the cars’ entry into the U. S., Ford deposited estimated duty payments with Customs. Ford subsequently concluded that its estimates were too high and filed reconciliation entries seeking a refund. The total refund claimed, across nine disputed entries at issue, was about $6.2 million. The general one-year time period imposed for liquidating such entries had long expired when Ford filed suit, 19 U.S.C. 1504(a). The Court of International Trade rejected the complaint’s assertion of jurisdiction under 28 U.S.C. 1581(i), the Tariff Act’s grant of residual jurisdiction over matters concerning enforcement and administration of duty assessment. The Federal Circuit reversed, finding valid invocation of the court’s residual jurisdiction, as the importer could not have asserted jurisdiction under any of the other enumerated provisions of section 1581. Post-complaint efforts by Customs to clear the importer’s accounts did not undo such jurisdiction. View "Ford Motor Co. v. United States" on Justia Law

Polar Holding was sole shareholder of PMC, a company engaged in the petroleum-additive business. PMC was in default on a loan for which it had pledged valuable intellectual property as collateral, and Polar Holding was in the midst of an internal dispute between members of its board of directors regarding business strategy for PMC. One of the directors, Socia, formed a competing company, Petroleum, for the purpose of acquiring PMC’s promissory note and collateral from the holder of PMC’s loan. Petroleum brought suit against Woodward, an escrow agent in possession of PMC’s collateral, alleging that PMC was in default on the payment of its promissory note. Polar Holding and PMC intervened and filed counterclaims against Petroleum and a third-party complaint against additional parties, including Socia. Polar Holding and PMC allleged breach of fiduciary duty, civil conspiracy, and tortious interference. After PMC filed for bankruptcy, its claims became the property of the bankruptcy trustee. Polar Holding’s claims were later dismissed. The Sixth Circuit affirmed dismissal of a tortious interference claim as addressed by the district court, but reversed dismissal of a breach-of-fiduciary-duty claim against Socia and a civil-conspiracy claim against individual third-party defendants. View "Petroleum Enhancer, L.L.C. v. Woodward" on Justia Law

EAR, a seller of manufacturing equipment, defrauded creditors by financing non-existent or grossly overvalued equipment and pledging equipment multiple times to different creditors. After the fraud was discovered, EAR filed for bankruptcy. As Chief Restructuring Officer, Brandt abandoned and auctioned some assets. Five equipment leases granted a secured interest in EAR’s equipment; by amendment, EAR agreed to pay down the leases ($4.6 million) and give Republic a blanket security interest in all its assets. Republic would forebear on its claims against EAR. The amendment had a typographical error, giving Republic a security interest in Republic’s own assets. Republic filed UCC financing statements claiming a blanket lien on EAR’s assets. After the auction, Republic claimed the largest share of the proceeds. The matter is being separately litigated. First Premier, EAR’s largest creditor, is concerned that Republic, is working with Brandt to enlarge Republic’s secured interests. After the auction, EAR filed an action against its auditors for accounting malpractice, then sought to avoid the $4.6 million transfer to Republic. The bankruptcy court approved a settlement to end the EAR-Republic adversary action, continue the other suit, divvy proceeds from those suits, and retroactively modify the Republic lien to correct the typo. First Premier objected. The district court affirmed. The Seventh Circuit affirmed. First Premier was not prejudiced by the settlement. View "First Premier Capital, LLC v. Republic Bank of Chicago" on Justia Law

In 2007, Marcus leased a 2007 BMW from a dealership in New Jersey. Marcus suffered four “flat” tires during his three-year lease. Each time, he drove his car to a BMW dealership in New York and had the tire replaced. BMW billed Marcus between $350 to $390 for parts, labor, fees, and taxes. In each instance, the run-flat tires (RFT) worked as intended. Marcus sued Bridgestone, asserting consumer fraud, breach of warranty, and breach of contract claims. He claims that Bridgestone RFTs are “defective” because they: are highly susceptible to flats, punctures and bubbles, and fail at a significantly higher rate than radial tires or other run-flat tires; cannot be repaired, only replaced, in the event of a small puncture; and are “exorbitantly priced.” He claimed RFT-equipped BMWs cannot be retrofitted to operate with conventional tires, and that they are difficult to replace. The district court certified the suit under FRCP 23(b)(3) as an opt-out class action on behalf of all purchasers and lessees of certain model-year BMWs equipped with Bridgestone RFTs sold or leased in New Jersey with tires that have gone flat and been replaced. The Third Circuit vacated. Marcus’s claims do not satisfy the numerosity and predominance requirements. View "Marcus v. BMW of N. Am., LLC" on Justia Law

In an antitrust class action alleging a conspiracy to fix prices in violation of the Sherman Act, 15 U.S.C. 1, the district court entered summary judgment in favor of defendants, manufacturers and sellers of “publication paper,” a type of paper used in preparing printed material of various types. Plaintiffs, direct purchasers of defendants’ paper products, claimed that defendants’ price hikes mirrored each other in amount and occurred in close succession and were instituted pursuant to an agreement, rather than independently. Plaintiffs also claimed that, in the same time frame, two defendants coordinated the closure of paper mills in order to reduce the supply of publication paper. The Second Circuit vacated in part. A jury could reasonably find that defendants entered into an agreement to raise the price of publication paper, and that, as implemented, this agreement damaged plaintiffs. View "In re: Publ'n Paper Antitrust Litig." on Justia Law