Justia Commercial Law Opinion Summaries

The LLC was organized in 1999 to own and operate 100 fast-food restaurants. Khan owned 40% of the common units. Remaining common units, and all preferred units, were owned by Sentinel. Plaintiffs, restaurant managers, claim that they accepted lower salaries because Khan told them that he would acquire full ownership and would reward top managers with equity. In 2005, Khan became the sole equity owner, but did not distribute common units to any managers. Plaintiffs calculated that the price paid for Sentinel's interest implied that the business was worth about $48 million; in 2005, 20 managers qualified for units, so each lost about $1.2 million. The district court held that plaintiffs had not adequately estimated damages. The Seventh Circuit reversed, stating that value is what people will pay. The judiciary should not reject actual transactions prices when they are available.View "Malik v. Falcon Holdings, LLC" on Justia Law

Plaintiffs are among the world’s largest purchasers of air conditioning and refrigeration copper tubing. Defendants imported ACR copper into the U.S. In 2003 the Commission of the European Communities found that defendants and other conspired on prices targets and other terms for industrial tubes and allocated customers and market shares in violation of European law. The findings did not identify any conspiratorial agreements with respect to U.S. markets. In 2004, another EC decision found violation in the market for plumbing tubes. Plaintiff claimed that the European conspiracy was also directed at the U.S. market for ACR industrial tubes, violating the Sherman Act and the Tennessee Trade Practices Act. Two similar cases, involving different plaintiffs, had been dismissed. The district court dismissed for lack of subject matter jurisdiction and failure to state a claim. The Sixth Circuit reversed, finding that the complaint adequately stated a claim under the Sherman Act and was not barred by the Act's limitations period, 15 U.S.C. 15b and that the court had personal jurisdiction. The fact that the complaint borrows its substance from the EC decision and then builds on the EC’s findings does not render its allegations any less valid.View "Carrier Corp. v. Outokumpu Oyj" on Justia Law

Plaintiff rented a car, drove 64 miles in one day, refilled the fuel tank, and returned the car to the same location from which he rented the car. In addition to rental and other fees that he does not dispute, he was charged a $13.99 fuel service fee that he challenged by filing a putative class action, claiming breach of contract, fraud, and unjust enrichment. Defendant claimed that, because plaintiff drove fewer than 75 miles during the rental period, to avoid the charge he was required to return the car with a full fuel tank and to submit a receipt. The district court dismissed, finding that the contract was not ambiguous. The Sixth Circuit affirmed, citing the voluntary payment doctrine.View "Salling v. Budget Rent A Car Sys., Inc." on Justia Law

In 2009 the fire protection district adopted an ordinance requiring commercial buildings and multi-family residences to have fire alarms equipped with wireless radio technology to send alarm signals directly to the district's central monitoring board. The ordinance provided that the district would contract with one private alarm company to provide and service signaling equipment, displacing several private fire alarm companies that have competed for these customers. The alarm companies sued on claims under the U.S. Constitution, federal antitrust law, and state law. The district court granted summary judgment for the alarm companies on the basis of state law and enjoined the district from implementing the ordinance. The Seventh Circuit affirmed in part, holding that the district has statutory authority to require that commercial and multi-family buildings connect directly to its monitoring board through wireless radio technology. The district does not, however, have authority to displace the entire private market by requiring all customers to buy services and equipment from itself or just one private company. View "ADT Sec. Servs., Inc. v. Lisle-Woodridge Fire Prot. Dist." on Justia Law

A 1998 settlement (MSA), between states and large tobacco companies (OPMs) included incentives for non-parties to join, but OPMs retained the most favorable payment terms. The MSA permitted states to enact statutes requiring nonparticipants to make deposits into escrows to be held for 25 years, in case a state obtained a future judgment against that nonparticipant. The MSA ensured that OPMs retained favored treatment over other participants. Plaintiff entered the market in 2000, as a nonparticipant, paying into state escrow accounts. As escrow payments became more burdensome, Plaintiff joined the MSA after negotiating a back-payment and future payments. During negotiations, defendants denied Plaintiff information about payment reductions granted to grandfathered companies. Plaintiff, unhappy with the disparate treatment and unable to meet its obligations, was unable to negotiate better terms because of an MSA provision that would entitle other participants to more favorable terms if such terms were granted to a late-joiner. Plaintiff sued tobacco manufacturers and attorneys general, alleging antitrust (15 U.S.C. 1, 3 (a)) and constitutional violations. The district court dismissed. The Sixth Circuit affirmed. Manufacturer defendants were immunized under the Noerr-Pennington and state-action doctrines. Plaintiff's waivers were knowing, intelligent, and voluntary, regardless of representations made during negotiations. View "VIBO Corp., Inc. v. Conway" on Justia Law

In 2001, U.S. Customs classified Aromont's imported flavorings, derived from veal, chicken, duck, lamb, beef, fish, lobster, mushroom, or vegetable stock, under Harmonized Tariff Schedule subheading 2104.10.00 covering "[s]oups and broths and preparations therefor ... Other." Aromont argued that the flavorings should have been classified under subheading 2106.90.99 covering "[f]ood preparations not elsewhere specified or included," which carries a lower ad valorem tax. Customs denied the protest and liquidated the merchandise. The Trade Court found that the products are not covered by 2104 because they are not principally used as soups or broths, but in a variety of end uses. The Federal Circuit affirmed. Aromont made a strong showing with respect to actual use, physical characteristics, and cost. The government did not show that any other factors required a contrary result, or that there is an issue of material fact on any of the relevant factors.View "Aromont USA, Inc. v. United States" on Justia Law

Triumph publishes books and software to prepare teachers and students for standardized tests. In 2004, Triumph filed use-based applications for the COACH word mark, a stylized COACH mark, and a COACH mark and design. CSI sells handbags, luggage, clothing, watches, eye glasses, and wallets and has used the COACH mark since at least 1961. CSI owns 16 incontestable registrations for the COACH mark: all but one issued before Triumph's application. CSI filed Notice of Opposition on grounds of likelihood of confusion (15 U.S.C. 1052(d)) and dilution (15 U.S.C. 1125(c)). The Trademark Trial and Appeal Board dismissed. The Federal Circuit affirmed findings that there was no likelihood of confusion between the marks and that CSI failed to prove likelihood of dilution. Because of evidentiary errors, the court vacated and remanded a finding that, although Triumph's marks are merely descriptive, they have acquired secondary meaning, and were entitled to registration. View "Coach Serv., Inc. v. Triumph Learning, LLC" on Justia Law

A class representing purchasers of securities sued the company and two high-ranking officers, alleging that the company issued false or misleading public statements about demand for its products in violation of the Securities Exchange Act of 1934, 15 U.S.C. 78j(b), and related regulations. The district court granted summary judgment to the company. The First Circuit affirmed. Once a downward trend became clear, the company explicitly acknowledged that its forecasts had been undermined. Whether it was negligent to have remained too sanguine earlier, there was no evidence of anything close to fraud. View "OK Firefighters Pension v. Smith & Wesson Holding Corp." on Justia Law

In 2006, BP began converting company-operated gas and convenience stores into franchisee-operated stores. From 2006 to 2008, plaintiffs purchased gas station sites and entered into long-term contracts with BP for fuel and use of BP's brand name and marks. In 2009 plaintiffs sued under the Illinois Franchise Disclosure Act. Consolidated cases were removed to federal court when plaintiffs added claims under the federal Petroleum Marketing Practices Act. They later added price discrimination claims under the Robinson-Patman Act. Before trial, all federal claims were withdrawn. The district judge relinquished supplemental jurisdiction and remanded to Illinois state court. The Seventh Circuit affirmed. A district court has broad discretion and the general presumption in favor of relinquishment was particularly strong because the state-law claims are complex and raise unsettled legal issues. View "RWJ Mgmt. Co., Inc. v. BP Prod. N. Am., Inc." on Justia Law

In an action under the Tariff Act, 19 U.S.C. 1337, the International Trade Commission found unfair trade practices based on infringement of Epson's U.S. patents by importation and sale of ink printer cartridges produced in China by Ninestar and imported into and sold in the U.S. by entities including Ninestar's subsidiaries, The Commission issued a general exclusion order, limited exclusion orders, and cease and desist orders. The Federal Circuit affirmed. Final Orders prohibited importation and sale of infringing cartridges, including cartridges in the inventory of U.S. subsidiaries. Subsidiaries continued to import and sell cartridges that were subject to the orders. An Administrative Law Judge determined that Ninestar was in violation and levied a penalty under 19 U.S.C. 1337(f)(2). The Commission reduced the penalty. The Federal Circuit affirmed, finding Ninestar China jointly and severally liable for the penalty ($55,000 per day, a total of $11,110,000) along with the U.S. subsidiaries. Ninestar was aware that refurbishing and reselling spent cartridges, not first sold in the U.S., would be patent infringement View "Ninestar Tech. Co., Ltd. v. Int'l Trade Comm'n" on Justia Law