Justia Civil Procedure Opinion Summaries

Debtor-Appellant Nathan Welch appealed a district court’s order denying his motion for judgment on the pleadings and determining that a default judgment was nondischargeable in bankruptcy. This case arose from the failure of the Talisman project, a high-end real estate development project in Wasatch County, Utah. Appellee Robert Tripodi was one of these investors, eventually putting $1 million into Talisman. To secure Tripodi’s investment, Welch issued three promissory notes to Capital Concepts, which in turn, assigned the notes to Tripodi. Welch ultimately defaulted on the notes. In January 2009, Tripodi filed a complaint against Mr. Welch in federal district court, alleging violations of state and federal securities laws. For seven months, Welch did not respond. In March 2010, Tripodi filed a motion for entry of default. The court granted the motion for entry of default and issued an order to show cause as to why a default judgment should not be entered. Receiving no response, the district court entered an order granting the entry of default judgment against Welch. Welch filed a voluntary petition for Chapter 7 bankruptcy in August 2011. Nearly two years later, Tripodi sought relief from the automatic stay. In his defense, Welch opposed Tripodi's proof of damages and costs, and attempted to have the default judgment set aside. The district court denied Welch's request to set aside the judgment, ruling the judgment was nondischargable. Finding no reversible error on the district court's judgment, the Tenth Circuit affirmed. View "Tripodi v. Welch" on Justia Law

In 2004, Quality Diesel Service, Inc. obtained a judgment against Gulf South Drilling Company, LLC. Then, after learning that Tiger Drilling Company, LLC was indebted to Gulf South, Quality Diesel had multiple writs of garnishment issued and served on Tiger Drilling from 2004 to 2006. All of Tiger Drilling’s answers to the writs were almost identical, stating that Tiger Drilling was indebted to Gulf South but that the debt was not yet due. On November 29, 2006, Quality Diesel contested Tiger Drilling’s responses by filing a Petition to Controvert Answers to Garnishments, specifically contesting Tiger Drilling’s answer to a writ issued on January 18, 2006. On March 14, 2014, Tiger Drilling filed a motion to dismiss the garnishment proceeding. On October 3, 2014, the Circuit Court granted dismissal on the ground that the underlying judgment had expired while the case was pending. On appeal, Quality Diesel contended that, because the underlying judgment was valid when the writs of garnishment were issued and served (and when it filed its Petition to Controvert) it could maintain a garnishment proceeding against Tiger Drilling, despite the fact that the underlying judgment has since lapsed. This case presented an issue of first impression concerning Mississippi’s garnishment law: when a party gets a judgment, timely executes a writ of garnishment, and timely initiates a garnishment proceeding, is that party required to renew the underlying judgment to collect the “property in the hands of the garnishee belonging to the defendant” at the time the garnishment proceeding was filed, to defeat the running of the statute of limitations? The Supreme Court held that a party was not required to renew the underlying judgment to collect such property under these circumstances. In this case, the Court reversed and remanded. View "Quality Diesel Service, Inc. v. Tiger Drilling Company, LLC" on Justia Law

VTB Bank, a Ukranian bank and company, brought this lawsuit against Development Max, LLC, a Delaware limited liability company, and Navitron Projects Corp., a Panamanian corporation and managing member of Development Max, alleging fraudulent transfer, constructive fraudulent transfer, and unjust enrichment. Development Max and Navitron filed a motion to dismiss on the grounds of forum non conveniens, among other theories. The Court granted the motion with respect to VTB’s claim against Navitron but denied the motion with respect to VTB’s claim against Development Max. On reconsideration, the Court granted, without prejudice, Development Max’s motion to dismiss on grounds of forum non conveniens, holding that Ukraine, as opposed to Delaware, was the proper forum in which to litigate this dispute. View "VTB Bank v. Navitron Projects Corp." on Justia Law

TriQuint Semiconductor, Inc., and its directors were defendants in two consolidated shareholder derivative suits filed in Washington State. TriQuint moved to dismiss those suits on the ground that its corporate bylaws establish Delaware as the exclusive forum for shareholder derivative suits. The trial court denied TriQuint’s motion to dismiss, and the Supreme Court allowed TriQuint’s petition for an alternative writ of mandamus. After review, the Supreme Court concluded that, as a matter of Delaware law, TriQuint’s bylaw was a valid forum-selection clause and bound its shareholders. The Court also concluded that, as a matter of Oregon law, the bylaw was enforceable. The Court issued a peremptory writ of mandamus directing the trial court to grant TriQuint’s motion to dismiss. View "Roberts v. TriQuint Semiconductor, Inc." on Justia Law

Expro Americas, LLC ("Expro") filed a complaint seeking, inter alia, a temporary restraining order and preliminary injunction against Eddie Walters, a former Expro employee, and H&H Welding, LLC. Expro offered "oil and gas well and pipeline services," including providing "specially designed flaring products and services to pipeline transmission companies and refineries along the Gulf Coast." Expro's six-inch, trailer-mounted flare stacks were at the heart of this dispute. Eddie Walters was an Expro employee until August 5, 2013. Thereafter, Walters was employed by Clean Combustion, a competitor of Expro's that was created in 2013 by former Expro employees. Expro filed its application for a restraining order against H&H and Walters, alleging that both defendants stole the design for its flare stack. Expro specifically alleged that "[t]he information used to design and create the trailer-mounted flaring system is a ‘trade secret' of Expro's." Furthermore, it alleged breach of contract against H&H, claiming that the terms of Expro's purchase orders with H&H contained a "Proprietary Rights" section "in which H&H ‘warrants to keep all design, information, blueprints and engineering data with respect to the Goods confidential and to not make use of but to assign to Expro each invention, improvement and discovery relating thereto (whether or not patentable) conceived or reduced to practice in the performance of the Purchase Order by any person employed by or working under the directions of the Supplier Group.'" The trial court granted the restraining order, but after conducting an evidentiary hearing, the chancellor dissolved the temporary restraining order and found no facts to justify the issuance of a preliminary injunction. The chancellor awarded the defendants attorneys' fees and expenses in excess of the $5,000 injunction bond that Expro had posted. After determining that Expro's suit against H&H was meritless, the chancellor sua sponte dismissed H&H from the suit with prejudice. Expro appealed, and the Supreme Court affirmed in part and reversed in part. The Court found that the chancellor did not err by awarding the defendants attorneys' fees and expenses, because Expro's application for a preliminary injunction was frivolous and was made in bad faith. However, the Court found the chancellor misapplied Mississippi Rules of Civil Procedure Rule 4, and therefore erred by dismissing H&H from the suit with prejudice. View "Expro Americas, LLC v. Walters" on Justia Law

The members of the Pennsylvania Public Utility Commission (PPUC) and Core Communications, Inc., appealed a District Court’s grant of summary judgment in favor of AT&T Corp. Core billed AT&T for terminating phone calls from AT&T’s customers to Core’s Internet Service Provider (ISP) customers from 2004 to 2009. When AT&T refused to pay, Core filed a complaint with the PPUC, which ruled in Core’s favor. AT&T then filed suit in federal court seeking an injunction on the ground that the PPUC lacked jurisdiction over ISP-bound traffic because such traffic is the exclusive province of the Federal Communications Commission. After review of the matter, the Third Circuit found that the FCC’s jurisdiction over local ISP-bound traffic was not exclusive and the PPUC orders did not conflict with federal law. As such, the Court vacated the District Court’s order and remanded this case for entry of judgment in favor of Core and the members of the PPUC. View "AT&T Corp v. Core Communications Inc" on Justia Law

In 2012, appellant Charles D. Leone II resigned his position as a principal of Madison Street Partners, LLC (“MSP”). Pursuant to the terms of MSP’s Operating Agreement, fellow principals Steven Owsley and Drew Hayworth elected to buy Leone’s interest in MSP. The agreement required the purchase price to be set at fair market value, as determined in good faith by MSP’s managers, Owsley and Hayworth. After receiving valuations from two independent valuation firms, the Managers proposed a purchase price of $135,850, which Leone rejected. Leone then sued the Managers in federal district court, contending the proposed purchase price was far below market value and asserted claims for breach of contract and breach of the implied covenant of good faith and fair dealing. The Managers moved for summary judgment on both claims, arguing Leone’s claims were barred by their good faith reliance upon the value set by the independent valuation firms. The district court granted the motion. On appeal, Leone argued: (1) the district court misapplied the law regarding express and implied good faith obligations; (2) the district court incorrectly held that bad faith requires a tortious state of mind; and (3) he presented sufficient evidence of bad faith to survive summary judgment. After review, the Tenth Circuit concluded Leone indeed presented sufficient evidence to survive summary judgment: “three different types of ‘good faith’ were at play in this case: the express contractual provision, an implied covenant of good faith, and the statutory safe harbor for good faith reliance on experts’ opinions. Regardless of which one applies, the Managers bore the burden as movants for summary judgment to establish there were no genuine issues of material fact with respect to their defense of good faith reliance on outside valuations. Although the Managers are entitled to a rebuttable presumption of good faith in relying on the outside valuations, Mr. Leone has raised genuine issues of material fact to rebut that presumption. Without the presumption and given the existence of fact issues regarding the Managers’ good faith, we conclude the district court erred in granting summary judgment in favor of the Managers on their affirmative defense.” View "Leone v. Owsley" on Justia Law

Defendant-appellant Ramon Soto appealed an order denying his motions to: (1) vacate entry of default and default judgment; and (2) quash service of summons and dismiss. Defendant filed the motions in connection with an action brought by plaintiff-respondent Diana Buchanan to set aside a fraudulent transfer. Plaintiff claimed that defendant Maria Soto transferred certain real property to her husband Ramon as a fraudulent conveyance to prevent Buchanan from executing an anticipated judgment on the property. Plaintiff eventually obtained the underlying judgment when she sued Maria for failing to pay money owed by Maria to plaintiff in connection with Maria's purchase of plaintiff's bridal business. Defendant argued the court erred in denying his motions because, at the time of entry of default and judgment thereon, the court allegedly did not have personal jurisdiction over him and he was not properly served with process. Finding no reversible error, the Court of Appeal affirmed. View "Buchanan v. Soto" on Justia Law

Wynn Resorts filed a lawsuit against Kazuo Okada, a former member of the board of directors of Wynn Resorts. As part of the discovery process, Wynn Resorts noticed Okada’s deposition for over the course of ten days in Las Vegas even though Okada resides in Hong Kong and owns businesses in Tokyo, Japan. Okada filed a motion for a protective order, asserting that his deposition should presumptively be conducted in Hong Kong or in Tokyo and that the deposition should not exceed three days. The district court denied his motion. Okada filed this writ petition, contending that the district court ignored a common-law presumption that his deposition should take place where he resides that that the district court erred in departing from Nev. R. Civ. P. 30(d)(1)’s presumption that depositions should be limited to one day. The Supreme Court denied Okada’s request for writ relief, holding that the district court did not abuse its discretion in (1) rejecting Okada’s argument regarding the common-law presumption and in determining that Okada failed to demonstrate good cause for having his deposition moved to a location other than Las Vegas; and (2) departing from Rule 30(d)(1)’s presumptive one-day time frame and adopting Wynn Resorts’ ten-day proposal. View "Okada v. Eighth Judicial Dist. Court" on Justia Law

Plaintiff Stockbridge Energy, LLC brought suit against Jim Taylor, John Groninger, Jr., and Taylor Drilling Corp. in 2003, alleging, among other things, a breach of the parties' partnership and agreement for oil and gas lease development in Osage County. Specifically, Stockbridge alleged the defendants failed to account for the profits and losses of the partnership, failed to transfer property according to the parties' agreement, engaged in "secret transactions," and misappropriated profits due the partnership. The individuals, Jim Taylor and John Groninger, Jr., specially appeared and moved to dismiss for failure to state a claim on the grounds that the petition showed no individual liability on their part and that the theory of "piercing the corporate veil" was not viable under the facts as pled. Stockbridge did not respond to the motion of the individual defendants and, on August 17, 2004, an order was filed wherein the trial court granted the unopposed motions to dismiss. There was no discussion regarding any amendment of the petition nor did the trial court's order of dismissal set forth a time to allow any amendments. More than four years after the order granting the motions to dismiss, Stockbridge filed a motion seeking to amend its petition to add Taylor and Groninger back in as individual defendants. Over the objections of the defendants, the trial court granted leave to amend by no later than May 20, 2009. Stockbridge filed an amended petition re-naming Taylor and Groninger, and also added a new defendant, David Bomberger. Taylor and Groninger appealed the Court of Civil Appeals' judgment which agreed with the trial court in adding them back into the litigation after they had been dismissed years ago. The individual defendants argued to the Supreme Court that the time to amend the pleadings in this case, if any, should not have extended beyond the applicable statute of limitations or the one year savings clause to which a dismissed claim is otherwise subject. The Supreme Court agreed and reversed the appellate court's order. View "Stockbridge Energy, LLC v. Taylor" on Justia Law