Justia Civil Procedure Opinion Summaries

When Goplin began working at WeConnect, he signed the “AEI Alternative Entertainment Inc. Open Door Policy and Arbitration Program,” which referred to AEI throughout; it never mentioned WeConnect. Goplin brought a collective action under the Fair Labor Standards Act. WeConnect moved to compel arbitration, Fed.R.Civ.P. 12(b)(3), attaching an affidavit from its Director of Human Resources stating, “I am employed by WeConnect, Inc.—formerly known as Alternative Entertainment, Inc. or AEI.” Goplin claimed that WeConnect was not a party to the agreement and could not enforce it. He cited language on WeConnect’s website: WeConnect formed when two privately held companies, Alternative Entertainment, Inc. (AEI) and WeConnect Enterprise Solutions, combined in September 2016… we officially became one company. WeConnect asserted that WeConnect and AEI were two names for the same legal entity, stating: This was a name change, not a merger. The court held that WeConnect did not establish that it was a party to the agreement or otherwise entitled to enforce it. The court rejected subsequently-submitted corporate-form documents and affidavits, stating that new evidence cannot be introduced in a motion for reconsideration unless the movant shows “not only that [the] evidence was newly discovered or unknown to it until after the hearing, but also that it could not with reasonable diligence have discovered and produced such evidence.” The Seventh Circuit affirmed. View "Goplin v. WeConnect, Inc." on Justia Law

Appellant Maxim Cabaret, Inc. d/b/a Maxim Cabaret was a strip club in Sandy Springs, Georgia, and appellant Theo Lambros was the club’s operator, sole shareholder, and president (collectively “Maxim”). Maxim appealed the superior court's order granting summary judgment to the City of Sandy Springs on Maxim’s legal challenges to city ordinances. The Georgia Supreme Court held that Maxim’s challenges to prior versions of the City’s ordinances that have since been replaced or amended were moot; current adult business ordinances prohibiting the sale of alcohol at businesses that offer live nude entertainment constitutionally regulate negative secondary effects of strip clubs without unduly inhibiting free speech or expression; and because the City may constitutionally prohibit Maxim from obtaining a license to sell liquor on its premises under the City’s adult business licensing ordinances, Maxim lacked standing to challenge the City’s alcohol licensing regulations. View "Maxim Cabaret v. City of Sandy Springs" on Justia Law

This case arose from a series of transactions in which petitioners Rocky Mountain Exploration, Inc. and RMEI Bakken Joint Venture Group (collectively, “RMEI”) sold oil and gas assets to Lario Oil and Gas Company (“Lario”). In the transaction, Lario was acting as an agent for Tracker Resource Exploration ND, LLC and its affiliated entities (collectively, “Tracker”), which were represented by respondents Davis Graham & Stubbs LLP and Gregory Danielson (collectively, “DG&S”). Prior to RMEI’s sale to Lario, RMEI and Tracker had a business relationship related to the oil and gas assets that were ultimately the subject of the RMEI-Lario transaction. The RMEI-Tracker relationship ultimately soured; Tracker and Lario reached an understanding by which Lario would seek to purchase RMEI’s interests and then assign a majority of those interests to Tracker. Recognizing the history between Tracker and RMEI, however, Tracker and Lario agreed not to disclose Tracker’s involvement in the deal. DG&S represented Tracker throughout RMEI’s sale to Lario. In that capacity, DG&S drafted the final agreement between RMEI and Lario, worked with the escrow agent, and hosted the closing at its offices. No party disclosed to RMEI, however, that DG&S was representing Tracker, not Lario. After the sale from RMEI to Lario was finalized, Lario assigned a portion of the assets acquired to Tracker, and Tracker subsequently re-sold its purchased interests for a substantial profit. RMEI then learned of Tracker’s involvement in its sale to Lario and sued Tracker, Lario, and DG&S for breach of fiduciary duty, fraud, and civil conspiracy, among other claims. As pertinent here, the fiduciary breach claims were based on RMEI’s prior relationship with Tracker. The remaining claims were based on allegations that Tracker, Lario, and DG&S misrepresented Tracker’s involvement in the Lario deal, knowing that RMEI would not have dealt with Tracker because of the parties’ strained relationship. Based on these claims, RMEI sought to avoid its contract with Lario. Lario and Tracker eventually settled their claims with RMEI, and DG&S moved for summary judgment as to all of RMEI’s claims against it. The district court granted DG&S’s motion. The Colorado Supreme Court granted certiorari to consider whether: (1) Lario and DG&S created the false impression that Lario was not acting for an undisclosed principal (i.e., Tracker) with whom Lario and DG&S knew RMEI would not deal; (2) an assignment clause in the RMEI-Lario transaction agreements sufficiently notified RMEI that Lario acted on behalf of an undisclosed principal; (3) prior agreements between RMEI and Tracker negated all previous joint ventures and any fiduciary obligations between them; (4) RMEI stated a viable claim against DG&S for fraud; and (5) RMEI could avoid the Lario sale based on statements allegedly made after RMEI and Lario signed the sales agreement but prior to closing. The Supreme Court found no reversible error and affirmed. View "Rocky Mountain Exploration, Inc. and RMEI Bakken Joint Venture" on Justia Law

Defendants, Nikolaos Pappas and Ascend Medical, Inc. (Ascend), appealed multiple orders of the Superior Court ruling that they misappropriated trade secrets of plaintiff Vention Medical Advanced Components, Inc. d/b/a Advanced Polymers, a Vention Medical Company (Vention), in violation of the New Hampshire Uniform Trade Secrets Act, RSA chapter 350-B (2009) (UTSA). Vention cross-appealed the trial court’s denial of its request for attorney’s fees. Vention is a medical components manufacturer in the medical device industry. Vention makes medical balloons, medical tubing, and heat shrink tubing (HST). Pappas began working at Vention after he graduated from the University of Massachusetts Lowell with a bachelor of science degree in plastics engineering and a master’s degree in innovative and technological entrepreneurship. Prior to working at Vention, Pappas had neither specifically studied HST nor had any experience working with HST. In December 2013, after working for Vention for about ten years, Pappas resigned from the company. During his employment, Pappas was exposed to Vention’s confidential HST technology and information. He also had knowledge of Vention’s business and marketing information and strategies, including the sales volumes for Vention’s various products. At the time he resigned, he was serving as the engineering manager of the HST department. At some point before Pappas resigned, he consulted with an attorney about his obligations under the confidentiality agreement. Almost immediately after leaving Vention, Pappas established Ascend. In late December 2013 and January 2014, the defendants began working with a website developer, communicated with one equipment vendor, and provided an initial machine design to a second equipment vendor. This design included extensive detail and critical specifications of the equipment they wanted built. By August 2014, the defendants began actively marketing HST. After the defendants launched their HST line, Vention requested information about the products. The defendants sent Vention samples of their HST in August and September 2014. After review, the New Hampshire Supreme Court found the trial court determined that the defendants neither willfully and maliciously misappropriated Vention’s trade secrets nor made a bad-faith claim of misappropriation, and there was support in the record for these determinations. Based upon its review of Vention’s arguments and the record, the Supreme Court could not say it was “clearly untenable” or “clearly unreasonable” for the trial court to decline to award fees for bad faith litigation. Accordingly, the Court found no reversible error and affirmed the Superior Court. View "Vention Medical Advanced Components, Inc. v. Pappas" on Justia Law

Following the Court of Appeals’ decision in RL BB ACQ I-GA CVL, LLC v. Workman, 798 SE2d 677 (2017), the Georgia Supreme Court granted certiorari to consider two questions: (1) whether attorney fees and costs are available under OCGA 9-15-14 for conduct that occurs during the course of post-judgment discovery; and (2) whether an entity is barred from seeking sanctions under OCGA 9-11-37 by failing to request sanctions at the time it sought and obtained a protective order under OCGA 9-11-26. The Court of Appeals reversed that portion of the order awarding fees pursuant to OCGA 9-15-14, concluding that the statute spoke only to conduct occurring during the course of a “lawsuit,” which concludes at judgment, and, thus, did not apply to post-judgment discovery proceedings. The appellate court also noted, without discussion, that OCGA 9-15-14 did not apply to non-parties. With respect to the fee award made pursuant to OCGA 9-11-37(a)(4)(A), the Court of Appeals questioned whether Appellants’ “failure to request their expenses at the time they sought the protective order barred them from seeking those expenses by way of a separate motion, filed more than 40 days after the protective order was entered,” and remanded the case to the trial court to consider the waiver issue. The Supreme Court answered the first question in the affirmative, the second in the negative, and, in so doing, affirmed in part and reversed in part the decision of the Court of Appeals. View "Workman et al. v. RL BB ACQ I-GA CVL, LLC et al." on Justia Law

Plaintiff and cross-defendant Duncan Prince obtained a judgment of $647,706.48 against defendant and cross-complainant Invensure Insurance Brokers, Inc. (Invensure). Invensure took nothing on its cross-complaint against Prince and his related business entity, cross-defendant ERM Insurance Brokers, Inc. (ERM). Invensure appealed, arguing the trial court wrongly decided issues related to the statute of limitations and numerous issues with respect to substantial evidence to support the judgment. It also claimed the court abused its discretion when admitting certain evidence. Prince and ERM also appealed two postjudgment orders, arguing the court erroneously granted a motion to tax costs and to deny them attorney fees. In the published portion of its opinion, the Court of Appeal found the trial court erred with respect to the validity of Prince’s offer to compromise under Code of Civil Procedure section 998, and remanded that issue for further consideration. In the unpublished portion of its opinion with respect to attorney fees, Prince argued he was entitled to attorney fees under Penal Code section 502. Invensure asserted a cause of action against him for violating this section, which included an attorney fee provision. The court denied the motion, deciding the attorney fees under the Penal Code section 502 cause of action and the cross-complaint’s remaining claims could not be apportioned. The Court of Appeal disagreed, concluding the causes of action in the cross-complaint all related to a common core of facts. Accordingly, the Court reversed the order denying attorney fees. View "Prince v. Invensure Ins. Brokers" on Justia Law

The district court dismissed Marc Schenkel's claims against Xyngular Corporation and various third parties as a sanction for abuse of what he claims was pre-litigation discovery. The Tenth Circuit had not previously decided whether pre-litigation conduct that did not give rise to the substantive claims in a case was sanctionable by dismissal of a party’s claims. After review of Schenkel's arguments on appeal, the Tenth Circuit concluded termination sanctions were permissible when pre-litigation conduct was aimed at manipulating the judicial process and was unrelated to the conduct that gave rise to the substantive claims in a case. Because the district court did not abuse its discretion in concluding that these conditions were met in the present case, its judgment was affirmed. View "Xyngular v. Schenkel" on Justia Law

The trial court granted summary judgment in favor of George McKee and Brownsville Station, LLC, dismissing Monty Brown’s claims against them. Brown and McKee were former business partners. At one time they each owned a fifty percent interest in Brownsville Station, which owned and operated an apartment complex in Starkville, Mississippi. But beginning in 2003, Brown began selling his interest to McKee. From July 2003 to January 2006, through a series of four agreements, Brown transferred all his interest units to McKee in exchange for money and title to the company tractor. As part of the final agreement, both parties agreed to a full and final release of any and all claims against each other. For six years, Brown had no dealings with McKee or Brownsville Station. Then, in September 2012, Brown received notice from the Secretary of State that McKee had filed articles of reinstatement for Brownsville Station and its subsidiary, BrownE, LLC. According to Brown, the September 2012 notice prompted him to tell his boss about his former business relationship with McKee. And his boss, who was also an attorney, suggested McKee had engaged in wrongdoing. Almost ten years after the first transfer and seven years after the final transfer, Brown sued McKee and Brownsville Station, alleging McKee formed the new LLC “solely to provide a vehicle to take secret or uniformed [sic] advantage of [Brown] by enabling [McKee], among other things, to change provisions of Brownsville LLC’s Operating Agreement without [Brown’s] informed consent.” Brown further alleged that, during the 2003-2006 transactions, McKee hid important financial information and documentation about Brownsville Station and its true value, violating the fiduciary duties McKee owed as both Brown’s attorney and fellow LLC member. Brown appealed, arguing the judge wrongly granted summary judgment without first allowing discovery. The Mississippi Supreme Court disagreed, finding that had summary judgment been granted based on the clear running of the statute of limitations. “And, as the trial judge rightly found, none of Brown’s discovery requests were aimed at establishing his claims were timely. Instead, they were zeroed in on proving his untimely claims.” Therefore, the trial judge did not abuse his discretion by denying Brown’s Rule 56(f) motion for a continuance. View "Brown v. McKee" on Justia Law

Charles Erwin appeals from an amended judgment entered in favor of Alerus Financial, N.A., for $5,265,653.09. Starting in 2012 Alerus made a series of loans totaling more than $15 million to Diverse Energy Systems, LLC. The loan agreement specified "Events of Default," including the failure to pay the indebtedness, the insolvency of the borrower or guarantor or the commencement of bankruptcy proceedings. Erwin was Diverse's chief executive officer, and he signed multiple personal guaranties, promising to be personally responsible for payment of up to $4 million of Diverse's debt owed to Alerus. In September 2015 Diverse filed for bankruptcy. In May 2016 Alerus sued Erwin for breach of contract and unjust enrichment, alleging Diverse was in default under the loan agreement and Erwin failed to make payment on the amount due under the guaranties. Alerus alleged Diverse's indebtedness exceeded $12 million and under the guaranties Erwin was liable for at least $4 million in principal and interest. On September 6, 2016, Erwin filed an answer to Alerus' complaint. Alerus moved for summary judgment, arguing Diverse defaulted on its loan obligations and Erwin breached the guaranty contracts by failing to pay the amounts due under the guaranties. Alerus also filed an affidavit in support of its motion from an Alerus employee, which it claimed showed the total outstanding principal and interest on the loans to Diverse. Erwin argued on appeal to the North Dakota Supreme Court the district court abused its discretion by failing to rule on his motion to amend his answer and entering judgment without allowing him to conduct discovery on Alerus' damage claims. Finding no reversible error, the Supreme Court affirmed the amended judgment. View "Alerus Financial, N.A. v. Erwin" on Justia Law

Karen Savage appealed the dismissal of her Idaho Wage Claim Act (“IWCA”) action by the district court. Savage brought this action against her employer Scandit Inc. (“Scandit”) in November 2016 after Scandit failed to pay her over $400,000 in commissions and bonuses she claims were due by the end of October. The district court granted Scandit’s motion to dismiss finding that Savage had failed to allege that she had earned the commissions as defined in the 2016 Commission Compensation Plan (“CCP”) between Savage and Scandit. The district court also denied Savage’s motion to amend, holding that the amendment would be futile. After review, the Idaho Supreme Court determined Savage alleged sufficient facts in her complaint to preclude dismissal, and that her motion to amend the complaint was not futile. Therefore, the Supreme Court reversed the district court’s decision granting the motion to dismiss the complaint, and denial of the motion to amend were reversed. The matter was remanded for further proceedings. View "Savage v. Scandit, Inc." on Justia Law