Justia Commercial Law Opinion Summaries

Plaintiffs Mark and Karla Gibbs brought claims in the federal district court against, among other defendants, Corinthian Title, Jeffrey Brown, Shelley Hickson, and Christine Tueckes, for civil conspiracy. The above defendants argued that the federal district court did not have in personam jurisdiction over them because Arkansas's long-arm statute does not allow application of conspiracy jurisdiction. The federal district court certified to the Supreme Court the question of whether the use of the conspiracy theory of in personam jurisdiction violates the state's long-arm statute. The Court answered in the negative. Arkansas's long-arm statute does not limit the exercise of personal jurisdiction to certain enumerated circumstances and is therefore limited only by federal constitutional law. Because jurisdiction based on the conspiracy theory does not violate due process, the conspiracy theory of in personam jurisdiction does not violate Arkansas's long-arm statute.

Gary Hoff filed a complaint alleging contract and negligence claims against Countrywide Home Loans, Inc. and Lake County Abstract & Title Company. Countrywide failed to appear or answer within the 20 days permitted by Mont. R. Civ. P. 12(a), after which Hoff moved for entry of default against Countrywide. Countrywide later attempted to reverse the default proceedings with a motion to set aside the default pursuant to Mont. R. Civ. P. 55(c) and then a Mont. R. Civ. P. 60(b) motion to set aside the entry of default for mistake or excusable neglect. The court denied the motions and entered a default judgment against Countrywide. Countrywide appealed and Hoff cross-appealed. The Supreme Court affirmed, holding (1) the district court did not err in its judgment against Countrywide because pursuant to Cribb v. Matlock Commc'n, Inc., good cause did not exist to set aside the entry of default, and (2) the district court did not err as Countrywide's 60(b) motion was procedurally defective. Lastly, the Court concluded the district court correctly denied Hoff's request for attorneys fees because the contract did not entitle either party to attorneys fees under the circumstances.

The imported back-mounted packs, used for outdoor activities and athletics, allow the user to drink without interrupting activity. U.S. Customs and Border Protection liquidated and classified the merchandise under subheading 4202.92.30, HTSUS, as "Trunks, . . . traveling bags, insulated food or beverage bags, . . . knapsacks and backpacks, . . . sports bags . . . and similar containers . . . of textile materials: . . . With outer surface of sheeting of plastic or of textile materials: . . . travel, sports and similar bags" at a rate of duty of 17.8%. The company argued that the insulated beverage bag established essential character and that the items were properly classified as either "insulated food and beverage bags . . . whose interior incorporates only a flexible plastic container of a kind for storing and dispensing potable beverages through attached flexible tubing" (4202.92.04) or "insulated food and beverage bags . . . other" (4202.92.08), dutiable at 7%. The Court of International Trade affirmed. The Federal Circuit reversed and remanded. The item is a composite product that includes features substantially in excess of those within the common meaning of "backpack." The essential character of the item is a disputed question of fact.

Dennis Deschamps purchased a mobile home park from the estate of Larry Rasmussen. Deschamps financed part of the purchase price through the estate in the form of an indenture note. In the previous case, Deschamps sued the estate, and a jury found the estate was not liable for negligent non-disclosure. In 2007 the estate began the proceedings for a nonjudicial foreclosure on the park after Deschamps stopped making payments on the note. In the instant case, Deschamps again sued the estate, seeking a temporary injunction barring the estate's sale of the property. The district court granted the estate's motion for summary judgment. Deschamps appealed, arguing (1) that the estate is barred from conducting a nonjudicial foreclosure on the property because the nonjudicial foreclosure must have been pleaded as a compulsory counterclaim in the first case; and (2) Deschamps was entitled to raise the affirmative defense of fraud to defeat the estate's nonjudicial foreclosure. The Supreme Court affirmed, holding (1) the district court did not err in ruling that the estate was not required to assert nonjudicial foreclosure as a mandatory counterclaim in the first action; and (2) as a plaintiff, Deschamps cannot assert affirmative defenses.

During the dissolution of the marriage of Karen and Rodney Stevens in 2008, the district court entered a temporary economic restraining order prohibiting any transfer by the parties of their assets during the pendency of the proceedings. The district court awarded Rodney all right and title in a truck titled in Karen's name and ordered Karen to transfer title to Rodney. Karen later transferred the title to her mother. In 2010 the district court issued a written order declining to hold Karen in contempt for her violation of the economic restraining order. Instead, the court ordered Karen to remove any liens on the truck and to secure a new certificate of title and ruled if Karen refused to do so, a judgment would be entered against her in the amount of $21,000. Later, Karen retook possession of the vehicle. Rodney appealed. The Supreme Court determined that the court acted within its discretion in refusing to issue a contempt order but did not have authority to modify the distribution of property under its prior decree without notice to both parties and an opportunity to be heard. However, because Rodney was not prejudiced by the district court's ruling, the judgment was affirmed.

Grizzly Security Armored Express, which provides security and armored services in Montana, filed suit against The Armored Group (TAG), which sells armored vehicles statewide and internationally, to recover damages from a sale of an allegedly defective vehicle. TAG failed to file a timely answer, and Grizzly moved for entry of default. The district court entered a default judgment against TAG, and the Supreme Court reversed. On remand, the district court granted TAG's motion to dismiss for lack of personal jurisdiction. Grizzly appealed. On appeal, the Supreme Court held that the district court had personal jurisdiction over TAG because (1) TAG transacted sufficient business in Montana to support the extension of long-arm jurisdiction over TAG under Mont. R. Civ. P. 4B(1)(a), and (2) the Montana court's exercise of personal jurisdiction over TAG through long-arm provisions does not offend traditional notions of fair play and substantial justice. Reversed and remanded.

Plaintiffs William and Connie Huston sought to enforce the terms of a global class action settlement agreement in the circuit court when defendants Mercedes-Benz and Smith Motor Cars allegedly refused to repair the plaintiffs' sports utility vehicle in accordance with the settlement agreement. The defendants moved to dismiss, claiming that the circuit court did not have jurisdiction to adjudicate the Hustons' claims. The circuit court certified to the Supreme Court the question of the circuit court's authority to adjudicate the plaintiffs' lawsuit against the defendants. The Supreme Court concluded that the circuit court did not have jurisdiction to consider the plaintiffs' lawsuit because continuing jurisdiction over the settlement agreement had been retained by the federal district court where the global class action settlement agreement was originally reached. As such, the plaintiffs could not properly maintain their suit against the defendants in the circuit court.

In 2010, a professional debt collector began aggressively attempting to collect a deficiency balance Linda Barr allegedly owed to a bank on a motorcycle loan. According to Barr, the debt collector, among other tactics, misrepresented facts to her and improperly accessed and used information from Barr's and her husband's credit report. Barr filed a complaint against the bank and the debt collector, alleging violations of the West Virginia Consumer Credit and Protection Act. The debt collector moved to dismiss. The district court certified the question of whether a consumer has a private cause of action against a professional debt collector who has engaged in debt collection practices that are prohibited under the Act to the Supreme Court. The Supreme Court held that the Act does provide a consumer with such a cause of action.

In 2000, Dick Anderson Construction (DAC) entered into a contract with Monroe Construction to do construction work on Paws Up Ranch, which was owned by Monroe Property. When each phase of the construction was completed, Monroe Construction sold that phase to Monroe Property. When DAC was not paid for the last $800,000 of its billings, it filed a construction lien to secure its claim. In 2001, DAC sued Monroe Property to foreclose the lien. On remand to the district court, Monroe Property argued since it was not a party to the construction contract with DAC, it was not a contracting owner against whom the lien could be foreclosed under the construction lien statutes. The district court granted Monroe Property's motion for summary judgment, and DAC appealed. The Supreme Court reversed, holding the facts of the case demonstrated that Monroe Construction was the actual agent of Monroe Property for the purpose of engaging DAC to complete construction work on the ranch. Therefore, under the statutes, Monroe Property, acting through its agent Monroe Construction, was a contracting owner with regard to the construction contract with DAC.

Plaintiff, an Illinois corporation, filed suit for conversion against a corporation based in South Korea and individuals. Although the defendants were served, there was no formal response. The individual defendants sent a letter asserting that they had no connection to the corporation and requesting dismissal. Several months later the court entered default judgment in the amount of $2,916,332. About a year later the defendants filed appearances and a motion to vacate for lack of personal jurisdiction. The district court denied the motion. The Seventh Circuit reversed and remanded. After noting that jurisdiction can be contested in the original proceeding or in a collateral action, the court concluded that the motion was not untimely. The letter did not constitute an appearance by the individuals and the corporation was not capable of making a pro se appearance. The defendants have submitted affidavits concerning whether they had "minimum contacts" with Illinois that must be considered by the court.