Justia Civil Procedure Opinion Summaries

This dispute involves several insurers and one defendant insurer’s alleged duty to defend a lawsuit brought against a general contractor of a residential building project. The district court entered partial summary judgment, holding that the defendant insurer had a duty to defend the general contractor in the underlying action for construction defects. The court also issued a stay of other issues raised by the parties, and administratively closed the case. After the defendant insurer filed the present appeal, the underlying action was resolved in a settlement agreement.   The Fourth Circuit concluded that it lacks jurisdiction to consider the present interlocutory appeal challenging the defendant insurer’s duty to defend the general contractor. Therefore, the court dismissed the appeal. The court explained that while the relief granted in the district court’s order originally may have been prospective in nature, the resolution of the underlying action has eliminated from that order any forward-looking mandate. Thus, the court explained that the order before the court in this appeal currently lacks the character of an injunction and does not require the court to consider any question separate from issues that may be appealed after entry of a final judgment in the district court. View "Westfield Insurance Company v. Selective Insurance Company" on Justia Law

MSSC, Inc., sued Airboss Flexible Products Co., alleging anticipatory breach of contract and seeking to enforce a purchase order between the parties after Airboss threatened to stop filling orders unless MSSC agreed to a price increase. Airboss supplied products to MSSC, and MSSC used those products to manufacture parts for their customers. The parties’ purchase order for the Airboss products was identified as a “blanket” order that listed the parts to be supplied but did not include specific quantities. Instead, the purchase order indicated that quantities would be based on the needs of an MSSC customer. MSSC was obligated to create and send “releases” per the terms and conditions, but neither the purchase order nor the terms and conditions obligated MSSC to send any number of firm orders to Airboss—either as a raw number or as a percentage of MSSC’s total need. The trial court granted a preliminary injunction in favor of MSSC, finding that the contract was a requirements contract and was likely enforceable. Airboss moved for summary judgment, arguing that the purchase order failed to satisfy the statute of frauds of the Uniform Commercial Code, MCL 440.1101 et seq. In response, MSSC moved for summary judgment, arguing that the blanket purchase order was a requirements contract that satisfied the statute of frauds. The trial court granted MSSC’s motion, concluding that because the purchase order was identified as a “blanket” order, it contained a “quantity term” that satisfied the statute of frauds. Airboss appealed, and the Court of Appeals affirmed. Contrary to the lower courts, the Michigan Supreme Court found the parties entered into a release-by-release contract, which allowed Airboss to stop selling parts to MSSC. View "MSSC, Inc v. Airboss Flexible Products Co." on Justia Law

The United States Court of Appeals for the Ninth Circuit certified a question of law to the Oregon Supreme Court. Defendants Eddie Bauer LLC and Eddie Bauer Parent, LLC, operate the Eddie Bauer Outlet chain of stores, where they sell branded clothing. More than 90 percent of the products offered at the outlet stores are manufactured solely for sale at the outlet stores and were not sold elsewhere. Defendants advertised clothing at the Eddie Bauer Outlet stores as being sold at a substantial discount; with limited exceptions, the clothing was never sold at the “list” price. In 2017, plaintiff Susan Clark purchased two articles of clothing from one of defendants’ outlet stores in Oregon. Plaintiff filed a complaint in federal district court, alleging that defendants had violated multiple provisions of the UTPA, including, among others, ORS 646.608(1)(j) (making false or misleading representations of fact concerning the reasons for, existence of, or amounts of price reductions), and ORS 646.608(1)(ee) (advertising price comparisons without conspicuously identifying the origin of the price the seller is comparing to the current price). Plaintiff alleged she had been fraudulently induced to buy those garments by defendants’ false representation that she was buying them at a bargain price. Defendants moved to dismiss plaintiff’s complaint on the ground that it failed to allege an “ascertainable loss of money or property,” as required of a complainant pursuing a private right of action under the UTPA. The federal appellate court asked the Supreme Court whether a consumer suffered an "ascertainable loss" when the consumer purchased a product that the consumer would not have purchased at the price that the consumer paid but for a violation of [ORS] 646.608(1)(e), (i), (j), (ee), or (u), if the violation arose from a representation about the product’s price, comparative price, or price history, but not about the character or quality of the product itself. The Oregon Court answered the Ninth Circuit's question in the affirmative. View "Clark v. Eddie Bauer LLC" on Justia Law

Plaintiff-appellant Steve Ahn was a sales executive for a title insurer who claimed his sales figures were adversely affected when his employer barred him from using a particular sales pitch to solicit customers from a competitor who was also a proposed corporate merger partner. Ahn’s pitch told prospective clients that after the proposed merger was finalized, they would have no choice but to comply with his company’s higher-cost, less flexible underwriting standards. He attempted to use this pitch to convince these clients to abandon the competitor before the merger. The issue this case presented for the Court of Appeals' consideration was whether Ahn had standing under the California antitrust statute, known as the Cartwright Act, to assert a cause of action. To this, the Court found that Ahn did not claim injury from the alleged anticompetitive aspects of the proposed merging entities' agreement, but rather from conduct that emphasized their competitive differences. "A complaint that he could not lure customers with a pitch about their restricted postmerger options does not constitute an antitrust injury, meaning Ahn lacks standing to sue under the Cartwright Act." The Court's conclusion that Ahn could not demonstrate an antitrust violation affected his derivative economic relations tort claims, both of which required independently wrongful conduct. Concluding the trial court did not err in granting summary judgment, the appellate court therefore affirmed the judgment. View "Ahn v. Stewart Title Guaranty Co." on Justia Law

Penn-Star Insurance Company (Penn-Star) appealed a trial court’s denial of its motion for summary judgment. The Mississippi Supreme Court found after review of the trial court record that because the commercial general liability policy at issue did not cover the sustained losses, the trial court’s order was reversed, judgment was rendered in favor of Penn-Star, and this case was remanded to the trial court for consideration of the remaining issues. View "Penn-Star Insurance Company v. Thompson, et al." on Justia Law

The Ninth Circuit Court of Appeals certified a question of law to the Oregon Supreme Court. Under Oregon’s Unlawful Trade Practices Act (UTPA), a person who suffers an “ascertainable loss of money or property” as a result of another person’s violation of the UTPA may maintain a private action against that person. The Ninth Circuit's question required a determination of whether a consumer could suffer an “ascertainable loss” under the UTPA based on a retailer’s misrepresentation about price history or comparative prices. More specifically, the Oregon Court had to consider whether a consumer suffered a cognizable “ascertainable loss” under ORS 646.638(1) when she buys items at an outlet store that have been advertised as being sold at a substantial discount but that have never been sold at that or any other location at the “list,” or non-sale price. To this, the Oregon Court responded in the affirmative. View "Clark v. Eddie Bauer LLC" on Justia Law

Plaintiff filed a complaint alleging seven causes of action against TFMI. Plaintiff alleged he entered into two oral contracts with TFMI for which he has not been paid – one for his management of TFMI farms located in Arizona and New Mexico (out-of-state management services) and the other for consulting services he rendered in connection with the management of TFMI orchards located in California (instate consulting services). The trial court entered judgment in favor of TFMI and against Schmidt.   The Fifth Appellate District reversed the trial court’s judgment dismissing Plaintiff’s complaint alleging seven causes of action against TFMI. The court held that the trial court erred in applying California law instead of Illinois law in determining whether to enforce the forum selection provision. The court held that in the interests of justice, it is best to remand the case to the trial court for reconsideration of the issue. Moreover, the parties themselves did not apply the correct law in arguing for or against the motion to quash and, thus, may not have submitted evidence they might now consider relevant to the court’s determination. Accordingly, the court explained it believes the trial court should entertain and consider additional briefing and evidence from each of the parties concerning the application of Illinois law to the question of whether the trial court should exercise, or decline to exercise, jurisdiction over claims involving the assigned Summit Gold invoices. View "Schmidt v. Trinut Farm Management" on Justia Law

Baker Sales, Inc. (“BSI”) obtained two loans from Newtek Small Business Finance, Inc. (“Newtek”) which were secured by mortgages on BSI’s commercial property. Robert and Elsa Baker (collectively “the Bakers”) executed agreements unconditionally guaranteeing payment of all amounts owed on the loans. These agreements were secured by conventional mortgages on the Bakers’ home. BSI filed for bankruptcy approximately two years later. Newtek filed a proof of claim in the bankruptcy proceeding for the total amount of the outstanding balance of the loans. The bankruptcy court granted Newtek’s motion to lift the automatic bankruptcy stay. Newtek then filed a petition for executory process in state court against BSI and the Bakers requesting seizure and sale of BSI’s commercial property without the benefit of appraisal. Newtek purchased the seized property at a sheriff’s sale; the bankruptcy case was subsequently closed. Newtek filed the suit at issue here, seeking to foreclose on the Bakers’ home. The trial court issued a judgment preliminarily enjoining the sale of the Bakers’ home and converted the proceeding from executory to ordinary. The Bakers filed a petition seeking a declaration under the Louisiana Deficiency Judgment Act (“LDJA”) that as the underlying debt was extinguished, Newtek could no longer pursue them as sureties. The Louisiana Supreme Court granted certiorari review to determine whether a creditor’s recovery in a deficiency judgment action was barred against a surety when a creditor forecloses on property through a judicial sale without appraisal. Harmonizing the LDJA with the law of suretyship, the Supreme Court agreed with the court of appeal that such recovery was barred. View "Newtek Small Business Finance, LLC v. Baker" on Justia Law

Mallory worked as a Norfolk mechanic for 20 years in Ohio and Virginia. After leaving the company, Mallory moved to Pennsylvania, then returned to Virginia. He attributed his cancer diagnosis to his work and sued Norfolk under the Federal Employers’ Liability Act, in Pennsylvania state court. Norfolk, incorporated and headquartered in Virginia, challenged the court’s exercise of personal jurisdiction. Mallory noted that Norfolk manages over 2,000 miles of track, operates 11 rail yards, runs locomotive repair shops in Pennsylvania, and has registered to do business in Pennsylvania in light of its "regular, systematic, extensive” operations there. Pennsylvania requires out-of-state companies that register to do business to agree to appear in its courts on “any cause of action” against them. 42 Pa. Cons. Stat. 5301(a)(2)(i), (b). The Pennsylvania Supreme Court held that the Pennsylvania law violated the Due Process Clause.The Supreme Court vacated. Pennsylvania law is explicit that qualification as a foreign corporation shall permit state courts to exercise general personal jurisdiction over a registered foreign corporation. Norfolk has complied with this law since 1998 when it registered to do business in Pennsylvania. Norfolk's “Certificate of Authority” from the Commonwealth conferred both the benefits and burdens shared by domestic corporations, including amenability to suit in state court on any claim. For more than two decades, Norfolk has agreed to be found in Pennsylvania and answer any suit there. Suits premised on these grounds do not deny a defendant due process of law. Regardless of whether any other statutory scheme and set of facts would establish consent to suit, this state law and these facts fall within Supreme Court precedent. View "Mallory v. Norfolk Southern Railway Co." on Justia Law

The United States Court of Appeals for the Fourth Circuit certified a question of South Carolina Supreme Court to the South Carolina Supreme Court. Metal Recycling Services, LLC, hired an independent contractor - Norris Trucking, LLC - to transport scrap metal. A truck driver employed by Norris Trucking hit the car Lucinda Ruh was driving and injured her. Ruh sued Metal Recycling Services and its parent company, Nucor Corporation, in state court. The defendants removed the case to the federal district court, which granted the defendants' motion to dismiss, finding Ruh did not allege an employer-employee relationship between the defendants and Norris Trucking or its driver, nor did she otherwise allege any basis on which the defendants could be liable for the negligence of their independent contractor. The district court delayed entry of judgment to allow Ruh to seek leave to amend her complaint. Ruh then moved to amend her complaint to add a claim that Metal Recycling Services itself was negligent in selecting Norris Trucking to transport the scrap metal. The district court denied the motion to amend and dismissed the complaint. The federal appellate court asked the South Carolina Supreme Court whether an employer could be subject to liability for harm caused by the negligent selection of an independent contractor. The Supreme Court responded in the affirmative: an independent contractor relationship may be subject to liability for physical harm proximately caused by the principal's own negligence in selecting the independent contractor. View "Ruh v. Metal Recycling Services, LLC" on Justia Law