Justia U.S. 8th Circuit Court of Appeals Opinion Summaries

Plaintiffs, 19 workers employed by Degeller, filed a class action suit on behalf of themselves and similarly situated Deggeller employees. The court concluded that the district court erred in dismissing the breach of contract claim where the workers’ allegation that Deggeller failed to pay the prevailing wage stated a valid claim for breach of their employment contracts. The court also concluded that the district court erred in dismissing the workers' claim for statutory damages under 26 U.S.C. 7434 because they alleged that Deggeller intentionally filed fraudulent tax documents on their behalf. Accordingly, the court reversed the district court’s Rule 12(b)(6) dismissals of these claims and vacate its decision under 28 U.S.C. 1367(c)(3) not to exercise supplemental jurisdiction over the Arkansas minimum wage claim. View "Cuellar-Aguilar v. Deggeller Attractions, Inc." on Justia Law

BLB filed suit against Jet Linx and Jamie Walker for damages arising from breach of contract. Jet Linx counterclaimed. The district court awarded damages to both parties and both parties appealed. The court concluded that cost-of-repair damages as argued by BLB would result in windfall and, therefore, in economic waste, a result the district court properly avoided. The court further concluded that diminution in value provides the appropriate measure of damages. Finally, the district court did not err in finding that BLB failed to prove its damages with sufficient certainty because BLB did not offer evidence of the reduced value of either airplane resulting from Jet Linx’s failure to provide a complete set of maintenance records and parts tags. Accordingly, the court affirmed the district court's judgment for Jet Linx. View "BLB Aviation South Carolina v. Jet Linx Aviation, LLC" on Justia Law

Quality Ag filed suit contending that it owns a sidetrack by means of adverse possession due to its continuous possession of the sidetrack from August 25, 2000 to August 25, 2010. BNSF has stored equipment on the sidetrack since one of its trains derailed near it on August 3, 2010. The district court granted summary judgment to BNSF, concluding that the adverse possession claim by Quality Ag was insufficiently pled, that BNSF owns the sidetrack, and that the agreement alleged by Quality Ag lacked consideration. The court concluded that Quality Ag's claim of adverse possession fails since it did not exclusively possess the sidetrack for at least ten years. Because Quality Ag has not shown that it owns the sidetrack, its breach of contract claim also fails. Accordingly, the court affirmed the judgment. View "Quality Ag. Serv. of Iowa, Inc. v. BNSF Railway" on Justia Law

Plaintiff, the executrix of her husband's estate, along with her husband's former business, Federal City, filed suit against Life Investors for conversion and tortious interference with a contract. On appeal, plaintiffs challenged the district court's dismissal of the complaint. The court concluded that this action is not barred by claim preclusion because the claims brought are not based upon the same cause of action as the prior suit. In this case, plaintiffs allege claims for conversion and tortious interference with contract against Life Investors because Life Investors removed over $400,000 from certain accounts to cover expenses above the alleged debt plaintiffs owed Life Investors. Life Investors removed these funds after the decision in the Maryland district court. The Maryland court never determined that plaintiffs lacked any interest in the assets in the accounts. Instead, it decided that plaintiffs were time-barred from bringing claims from a 2000 request for withdrawal of the assets and that the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., claims were either time-barred or failed to allege a violation of ERISA law. Similarly, the claim is not barred by issue preclusion. Accordingly, the court reversed and remanded. View "Corrado v. Life Investors Ins. Co." on Justia Law

Life Investors filed suit against defendants, alleging breach of a settlement agreement that required defendants to repay advances of monies defendants received from Life Investors. On appeal, defendants challenged the district court's grant of summary judgment to Life Investors. The court affirmed, concluding that defendants' laches defense failed because they cannot show unreasonable delay on the part of Life Investors in bringing this suit nor can defendants show that they were prejudiced; even if the alleged inconsistencies were material, defendants chose not to investigate further and thus the determination that they ratified the Settlement Agreement was correct; the district court correctly granted summary judgment on the question of ratification of the Settlement Agreement after certifying that question to the Iowa Supreme Court and receiving its answer; and defendants' attempt to argue an Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., violation as a defense in this action is barred as a matter of issue preclusion. View "Life Investors Ins. Co. v. Federal City Region" on Justia Law

In 2006, fire destroyed Calvin’s home. His insurer paid the claim, but indicated that it would not reinsure him. Calvin rebuilt on the same land and applied for a policy through the Mackey Agency. Calvin answered questions posed to him by Eleen Mackey, an employee, who entered the information into a computer. Asked if he had a fire loss within the previous three years, Calvin stated that he had a fire at the same location. Mackey printed the application. Calvin signed without reading it. The “No” box next to the question about prior fire loss was marked, but the blank within the question was not filled in. The space for Calvin's initials is also blank. Metropolitan issued a homeowner’s policy in 2007. Calvin paid the premiums regularly. In 2011, Calvin’s rebuilt home was destroyed by fire while the family was on vacation. Metropolitan’s investigation was inconclusive; no cause could be determined. Metropolitan denied Calvin’s claim and sought a declaratory judgment to void the policy, based on material misrepresentations in the application and the claims process, claiming that Calvin caused the fire to be set. Calvin counterclaimed breach of contract, slander, outrage, and bad faith. The district court determined that Calvin misrepresented his prior loss and that there was no evidence that Metropolitan acted in a dishonest, malicious, or oppressive manner. The Eighth Circuit reversed as to misrepresentation in the application and breach of contract, but affirmed with respect to bad faith and on Metropolitan’s defense of arson claim. Metropolitan can seek rescission of the contract. View "Metro. Prop. & Cas. Ins. Co. v. Calvin" on Justia Law

In 2009, Liu, a physician in a residency program, elected basic life insurance coverage from LINA through his employer’s ERISA plan and elected supplemental coverage in an amount four times his salary. Asked whether, within the last five years he had been diagnosed with “Cancer, Tumor, Leukemia, Hodgkin’s Disease, Polyps or Mole,” he answered “no.” One month after submitting his application, Liu received a cancer diagnosis. On March 1, 2010, the insurance became effective. On April 23, 2010, Liu died. LINA paid the basic benefit of $46,858.49, but reviewed Liu’s medical records, which revealed that Liu had been experiencing symptoms without a diagnosis before submitting his November 12 application. LINA then issued a denial, stating: While the form was completed accurately at the time ... a diagnosis of cancer prior to the coverage approval date was not disclosed … [the] Form states ... any changes in your health prior to the insurance effective date must be reported. His wife responded that Liu was told he would not have to provide evidence of good health, but did not identify the person who made the alleged representation. The court rejected the wife’s suit on summary judgment. The Eighth Circuit affirmed. Liu breached an application requirement by failing to notify LINA of a cancer diagnosis he received before a policy issued. View "Huang v. Life Ins. Co. of N. Am." on Justia Law

The Lapideses renewed a loan from Venture Bank secured by a third mortgage on their home. Howard subsequently filed for Chapter 7 bankruptcy. After Howard’s personal debts were discharged, the Lapideses executed two “Change in Terms Agreements,” each of which extended the maturity date of the loan for six months. When Howard ceased making payments under these agreements, Venture Bank sought a declaratory judgment that the agreements were valid and enforceable. Howard counterclaimed that Venture Bank’s efforts to obtain payments after his discharge violated the discharge injunction under 11 U.S.C. 524(a)(2). The bankruptcy court denied Venture Bank’s claim for a declaratory judgment and awarded Howard damages and attorney’s fees. The district court and Eighth Circuit affirmed, upholding a finding that Howard’s payments were not voluntary within the meaning of section 524(f) and did not comply with the requirements of a reaffirmation agreement under section 524(c). The post-discharge agreements served no purpose other than reaffirmation agreements in which Howard agreed to repay all of his discharged personal debt and lacked consideration. View "Venture Bank v. Lapides" on Justia Law

American manufactures and Southland sells iron castings. After operating under a verbal agreement for years, the companies entered into a written “Exclusive Representation Agreement” in 2010. American was aware Southland represented other foundries. The contract incorporated lists of American’s active and potential customers and identified the companies with which Southland had an existing relationship, but did not define covered “products.” Both agreed to noncompete clauses. In 2011, Southland obtained $32.5 million in new sales —80% of American’s total new sales. In 2012, American CEO Fuller began advocating for replacement of Southland with an internal sales team. Fuller later determined that Southland was providing quotes that he considered to be a breach of the contract, but did not immediately address the issue. American began to organize an internal sales force. Meanwhile, Southland continued seeking orders and obtained $24 million in new business for American. After several months, American notified Southland that American considered Southland in breach and sent a termination letter. American did not explain and discontinued paying commissions. Southland sued, alleging American breached the contract by not providing adequate notice of breach or the opportunity to cure and by not paying continuing commissions. American alleged Southland had committed an incurable breach such that notice and the opportunity to cure were not necessary. The district court denied summary judgment, finding the contract ambiguous with respect to the terms “Products” and “compete.” The Eighth CIrcuit affirmed findings that American breached the contract and owed Southland $3.8 million in damages based on the sales during the post-termination period. View "Southland Metals, Inc. v. Am. Castings LLC" on Justia Law

Creative, an Iowa corporation, designs and sells beauty products. LF, a Hong Kong corporation, with its principal place of business in Hong Kong, provides services, including product development, shipping oversight, and production planning. LF contacted Unger, President of Creative, in Iowa, seeking to manage Creative’s operations in China and e-mailed a presentation describing proposed services. Unger traveled to Hong Kong to execute the contract. LF managed Creative’s supply chain; the companies communicated extensively electronically and by telephone for two years. As required by the contract, LF shipped pre-production and production samples (made in China by third party factories) to Iowa. LF received payments from Creative’s customers on its behalf, and sent proceeds, less deductions, to Iowa. No LF agents or employees visited Iowa and LF has no connection with Iowa outside of this business relationship. Creative filed suit in Iowa, alleging that LF breached the contract by sending samples that could not be used because they were defective. The district court dismissed for lack of personal jurisdiction. The Eighth Circuit reversed, stating that a reasonable jury could find that LF had sufficient contacts with Iowa to justify the exercise of personal jurisdiction and that the exercise of jurisdiction would not offend traditional notions of fair play and substantial justice. View "Creative Calling Solutions Inc v. LF Beauty Ltd." on Justia Law