Justia Civil Procedure Opinion Summaries

A trading company and a base oil manufacturer entered into a sales agreement in 2016, under which the manufacturer would serve as the exclusive North American sales representative for a high-quality base oil product distributed by the trading company. The agreement included noncompete provisions and was set to expire at the end of 2021. In late 2020, suspicions arose between the parties regarding potential breaches of the agreement, leading to a series of letters in which the trading company accused the manufacturer of selling a competing product and threatened termination if the alleged breach was not cured. The manufacturer responded by denying any breach and, after further correspondence, declared the agreement terminated. The trading company agreed that the agreement was terminated, and both parties ceased their business relationship.The trading company then filed suit in the United States District Court for the Southern District of Texas, alleging antitrust violations, breach of contract, business disparagement, and misappropriation of trade secrets. The manufacturer counterclaimed for breach of contract and tortious interference. After a bench trial, the district court found in favor of the manufacturer on the breach of contract and trade secret claims, awarding over $1.3 million in damages. However, the court determined that the agreement was mutually terminated, not due to anticipatory repudiation by the trading company, and denied the manufacturer’s request for attorneys’ fees and prevailing party costs.On appeal, the United States Court of Appeals for the Fifth Circuit affirmed the district court’s finding that the trading company did not commit anticipatory repudiation and that the agreement was mutually terminated. The Fifth Circuit also affirmed the denial of prevailing party costs under Rule 54(d) of the Federal Rules of Civil Procedure. However, the appellate court vacated the denial of attorneys’ fees under the agreement’s fee-shifting provision and remanded for further proceedings on that issue. View "Penthol v. Vertex Energy" on Justia Law

A group of institutional investors brought a class action lawsuit against a pharmaceutical company and several of its officers, alleging violations of federal securities laws after the company’s share price dropped significantly following the rejection of a takeover bid and subsequent negative financial disclosures. One large investor, Sculptor, intended to pursue its own individual lawsuit rather than participate in the class action. The District Court certified the class and issued a notice specifying the procedure and deadline for class members to opt out. Although Sculptor intended to opt out, its counsel failed to submit the required exclusion request by the deadline. Both Sculptor and the company proceeded for years as if Sculptor had opted out, litigating the individual action and treating Sculptor as an opt-out plaintiff.The United States District Court for the District of New Jersey later approved a class settlement, which prompted the discovery that Sculptor had never formally opted out. Sculptor then sought to be excluded from the class after the deadline, arguing that its conduct showed a reasonable intent to opt out, that its failure was due to excusable neglect, and that the class notice was inadequate. The District Court rejected these arguments, finding that only compliance with the court’s specified opt-out procedure sufficed, that Sculptor’s neglect was not excusable under the relevant legal standard, and that the notice met due process requirements.The United States Court of Appeals for the Third Circuit affirmed the District Court’s judgment. The Third Circuit held that a class member must follow the opt-out procedures established by the district court under Rule 23; a mere “reasonable indication” of intent to opt out is insufficient. The court also found no abuse of discretion in denying Sculptor’s late opt-out request and concluded that the class notice satisfied due process. View "Perrigo Institutional Investor Group v. Papa" on Justia Law

A Luxembourg-based investment fund and its former General Partner became embroiled in a complex dispute following a contentious split among the fund’s founders. The fund, originally managed by Novalpina Capital Partners I GP S.À.R.L. (Novalpina), saw its General Partner position transferred to Treo NOAL GP S.à.r.l. (Treo) after a vote by limited partners, including the Oregon Public Employees Retirement Fund (OPERF). The fund’s structure involved multiple entities and significant investments, with allegations of improper conduct and maneuvers by both sides during the transition. Novalpina and Treo subsequently initiated several lawsuits in Luxembourg, including actions over control of the fund and claims for financial entitlements.Novalpina filed an ex parte petition in the United States District Court for the District of Oregon under 28 U.S.C. § 1782, seeking discovery from Oregon officials for use in foreign proceedings, specifically the Veto Right Litigation and a contemplated fraud claim. Treo, Langdon, and Read intervened, and the district court granted the petition, finding statutory and discretionary factors favored Novalpina. The parties negotiated a protective order, which allowed use of the documents in litigation related to the events described in the petition. After Novalpina used the documents in additional foreign proceedings, Treo moved for reconsideration of the discovery grant and to modify the protective order, arguing misuse and misrepresentation.The United States Court of Appeals for the Ninth Circuit reviewed the district court’s denial of Treo’s motions. The Ninth Circuit held that documents produced under § 1782 for use in specified foreign proceedings may be used in other proceedings unless the district court orders otherwise. The court found no abuse of discretion in the district court’s denial of Treo’s motion for reconsideration or its request to modify the protective order, affirming the district court’s rulings. View "NOVALPINA CAPITAL PARTNERS I GP S.A.R.L V. READ" on Justia Law

P&J Beverage Corporation filed a lawsuit against the City of Columbus, seeking to prevent the city from issuing an alcoholic beverage license to The Bottle Shop, LLC, and later sought to revoke the license after it was issued. P&J argued that The Bottle Shop’s location was too close to a daycare, which it claimed qualified as a “school” under city ordinances. The trial court granted summary judgment to P&J, invalidating The Bottle Shop’s license and enjoining its operation. The Bottle Shop’s attorney then emailed P&J’s attorney, referencing a potential claim for wrongful injunction if the appellate court reversed the trial court’s order, and requested a stay of the injunction pending appeal. P&J declined, and The Bottle Shop’s motion for a stay was denied by the trial court but later granted by the Court of Appeals, which ultimately reversed the trial court’s decision on the merits.Subsequently, The Bottle Shop sued P&J for both abusive litigation and wrongful injunction, seeking damages, attorney fees, and punitive damages. At trial, The Bottle Shop presented evidence of lost revenue, overhead costs, and attorney fees incurred during the period it was closed. The jury awarded substantial damages, attorney fees, and punitive damages. The trial court entered judgment accordingly. P&J moved for a directed verdict and for judgment notwithstanding the verdict, arguing, among other things, that The Bottle Shop failed to provide the statutory notice required for an abusive litigation claim. The trial court denied these motions, and the Court of Appeals affirmed, holding that the email satisfied the statutory notice requirement.The Supreme Court of Georgia reviewed the case and held that the email sent by The Bottle Shop did not satisfy the statutory notice requirement under OCGA § 51-7-84 (a) for an abusive litigation claim, as it failed to identify the civil proceeding as abusive litigation. The Court vacated the trial court’s judgment and remanded the case for further proceedings to determine what portion of the damages, if any, remain valid. View "P& J BEVERAGE CORPORATION v. THE BOTTLE SHOP, LLC" on Justia Law

Plaintiffs filed a class action lawsuit in state court against Defendants, alleging violations of state securities laws. Defendants removed the case to federal court under the Securities Litigation Uniform Standards Act (SLUSA), arguing that the case involved covered securities. Plaintiffs amended their complaint to exclude any claims related to covered securities, leading the district court to remand the case to state court. After three years of state court litigation, Defendants removed the case again, citing an expert report that allegedly identified covered securities. The district court remanded the case again and awarded Plaintiffs $63,007.50 in attorneys' fees.The United States District Court for the District of South Carolina initially denied Plaintiffs' motion to remand but later granted it after Plaintiffs amended their complaint. The court found that the amended complaint excluded any claims related to covered securities, thus SLUSA did not apply, and no federal question remained. After Defendants removed the case a second time, the district court remanded it again and awarded attorneys' fees, finding the second removal lacked a reasonable basis.The United States Court of Appeals for the Fourth Circuit reviewed the case and affirmed the district court's award of attorneys' fees. The court held that the second removal was improper because the amended complaint explicitly excluded claims related to covered securities, and thus SLUSA did not apply. Additionally, the court found that the removal was objectively unreasonable, as the district court had already addressed the issues in its first remand order. The Fourth Circuit also denied Plaintiffs' request for additional attorneys' fees for defending the appeal, stating that 28 U.S.C. § 1447(c) does not authorize fee awards on appeal. View "Black v. Mantei & Associates, Ltd." on Justia Law

The New Jersey Coalition of Automotive Retailers (NJCAR), a trade association representing franchised new car and truck retailers in New Jersey, sued Ford Motor Company. NJCAR alleged that Ford's Lincoln Commitment Program (LCP) violated the Franchise Practices Act (FPA) by creating price differentials among franchisees. NJCAR is not a franchisee itself but represents franchisee members, including Lincoln dealerships.The trial court granted summary judgment in favor of Ford, ruling that NJCAR lacked statutory standing to sue under the FPA because the statute limits the right to sue to franchisees. NJCAR appealed, arguing that it had associational standing to represent its members. The Appellate Division reversed the trial court's decision, holding that NJCAR had associational standing and that New Jersey's liberal standing doctrine did not preclude NJCAR from bringing the suit.The Supreme Court of New Jersey reviewed the case and reversed the Appellate Division's decision. The Court held that the FPA explicitly limits the right to bring a lawsuit to franchisees, as indicated by the statute's language stating that "any franchisee may bring an action against its franchisor." The Court emphasized that the Legislature's intent was clear in restricting the right to sue to franchisees only, and NJCAR, not being a franchisee, lacked statutory standing to bring the suit under the FPA. The Court did not address whether NJCAR would have associational standing under a different cause of action, limiting its holding solely to the FPA. View "New Jersey Coalition of Automotive Retailers, Inc. v. Ford Motor Company" on Justia Law

A stockholder of Amazon.com, Inc. sent a letter to the company demanding to inspect its books and records under Section 220 of the Delaware General Corporation Law. The stockholder aimed to investigate potential wrongdoing and mismanagement by Amazon, believing the company engaged in anticompetitive activities in the U.S. and Europe. When the stockholder and Amazon could not agree on certain conditions for producing the records, the stockholder filed an action in the Court of Chancery.A Magistrate in Chancery conducted a one-day trial and concluded that the stockholder did not meet its burden to prove a "credible basis" for inferring possible wrongdoing by Amazon. The stockholder took exceptions to the final report. A Vice Chancellor adopted the final report's conclusion but did not reach its credible basis analysis, instead finding the scope of the stockholder's stated purpose to be "facially improper" and not "lucid."On appeal, the Supreme Court of the State of Delaware found that the Vice Chancellor erred in interpreting the scope of the stockholder's purpose and was required to engage with the evidence presented. The court determined that the evidence, including a complaint filed by the Federal Trade Commission against Amazon for alleged antitrust violations that largely survived a motion to dismiss, established a credible basis from which a court could infer possible wrongdoing by Amazon. The Supreme Court reversed the judgment of the Court of Chancery and remanded for further proceedings to determine the scope and conditions of production consistent with its decision. View "Roberta Ann K.W. Wong Leung Revocable Trust v. Amazon.com, Inc." on Justia Law

Kevin Rowe filed a lawsuit against his ex-wife, Dione Rowe, alleging tortious interference with a business relationship. Dione, with the help of her daughters, sent a letter to the Tribal Land Enterprise (TLE) making disparaging allegations against Kevin, who leased Tribal-owned land from the TLE. The letter requested the TLE to cancel Kevin’s leases and lease the land to her daughters instead. The TLE rescinded Kevin’s leases at their next board meeting, leading Kevin to file the lawsuit.The Circuit Court of the Sixth Judicial Circuit in Tripp County, South Dakota, denied Dione’s motion for summary judgment, which argued that her letter was an absolutely privileged communication under SDCL 20-11-5(2). The court concluded that the TLE meeting was a quasi-judicial proceeding but held that the privilege did not apply because the TLE did not follow its own procedures, including providing notice to Kevin.The Supreme Court of the State of South Dakota reviewed the case and reversed the circuit court’s decision. The Supreme Court held that the absolute privilege under SDCL 20-11-5(2) applies to claims of tortious interference with a business relationship. The court found that the TLE board meeting was an official proceeding authorized by law and that Dione’s letter had a logical relation to the TLE’s proceedings. The court also determined that the lack of notice to Kevin did not negate the privilege. Additionally, the court concluded that Dione did not waive the privilege by failing to plead it in her answer, as the issue was tried by implied consent during the summary judgment proceedings. The Supreme Court directed the lower court to enter summary judgment in favor of Dione. View "Rowe v. Rowe" on Justia Law

Golden View Ready-Mix, LLC (Golden View) supplied concrete to Grangaard Construction, Inc. (Grangaard) for a bridge project. Golden View alleged that Grangaard failed to pay for the concrete, breached the implied obligation of good faith and fair dealing, and committed fraud. A jury found in favor of Golden View on the breach of contract and good faith claims, awarding damages and punitive damages, but found no liability for fraud. Grangaard appealed the punitive damages award and the decision to submit the fraud issue to the jury.The Circuit Court of the First Judicial Circuit, McCook County, South Dakota, presided over the case. Grangaard moved for partial summary judgment on the fraud claim, arguing there was no independent tort duty outside the contract. The court denied this motion, allowing the fraud claim to proceed. During the trial, the court permitted the jury to consider punitive damages based on the breach of the implied obligation of good faith, despite Grangaard's objections.The Supreme Court of the State of South Dakota reviewed the case. The court determined that punitive damages are only recoverable for breaches of obligations not arising from a contract, as per SDCL 21-3-2. The court found that the implied obligation of good faith arises from the contract itself and does not constitute an independent tort that could support punitive damages. Consequently, the court vacated the punitive damages award. However, the court affirmed the lower court's judgment in all other respects, concluding that the error regarding punitive damages did not affect the jury's decision on the breach of contract and good faith claims. View "Goldenview Ready-Mix, LLC v. Grangaard Construction, Inc." on Justia Law

The Nelson Estate claimed an interest in a coin shop and alleged conversion of its property. Dr. Earl Nelson had provided funds for the business, resulting in a 50% ownership interest, which was confirmed by William Tinkcom. After Dr. Nelson's death in 2013, Tinkcom continued to operate the business and assured Nelson's heirs of their 50% interest. Tinkcom died in 2022, and the business was sold to Eddie Welch without including the Nelson Estate in the final agreement. The Nelson Estate sued the Tinkcom Estate, Welch, and Mere Coin Company, LLC, for breach of contract, unjust enrichment, and other claims, including conversion of valuable coins and collectibles.The Circuit Court of the Second Judicial Circuit in Minnehaha County, South Dakota, granted the defendants' motion for judgment on the pleadings, concluding that the statute of limitations barred all claims. The Nelson Estate argued that the statute of limitations had not expired and that equitable estoppel or fraudulent concealment should prevent the statute of limitations defense.The Supreme Court of South Dakota reviewed the case and affirmed the circuit court's determination that the first six business interest claims accrued upon Dr. Nelson's death in 2013. However, the court reversed the dismissal of these claims because the circuit court did not address the Nelson Estate's defenses of equitable estoppel and fraudulent concealment. The court also reversed the dismissal of the tortious interference and civil conspiracy claims, as these claims arose from the 2022 sale of the business. Lastly, the court reversed the dismissal of the conversion claim, noting that the record did not establish when the conversion occurred or when the Nelson Estate became aware of it. The case was remanded for further proceedings. View "Nelson v. Tinkcom" on Justia Law