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

Farmer owned Arkat Nutrition, which owned the Plant One feed mill in Arkansas. Arkat Land owned Plant Two, which was leased to Arkat Nutrition, which produced animal feed. In 2007, a tornado damaged Plant One. Arkat decided not to repair the plant because its equipment had little useful life remaining. Debris from the tornado was removed, leaving scrap with potential value. Friedman made an oral contract with Farmer to act as a broker for the remaining Plant One equipment. Arkat Nutrition says that it was understood that it could also continue to attempt to find a buyer on its own. Friedman disagrees. Friedman sold some equipment and received a commission of $25,000. In 2010, Arkat Nutrition and Arkat Land transferred assets to a new company, Animal Nutrition, the equity interests of which were sold to Dad’s Products, which was not to be responsible for any investor or third-party claims against Animal Nutrition. Farmer claims that sale was planned since 2002. Dad’s later changed its name to Ainsworth and hired a third-party to remove remaining Plant One scrap. Friedman sued. The Eighth Circuit affirmed summary judgment in favor of the defendants, rejecting alter-ego claims and claims of unjust enrichment and promissory estoppel, and noting the limitations period. View "Friedman v. Farmer" on Justia Law

LoRoad, based in Oregon, negotiated to have GXV, based in Missouri, build a custom expedition vehicle. While the parties were exchanging drafts of an Agreement, LoRoad wired GVX $120,000, but subsequently expressed several concerns and requested revisions. GVX promised a final set of documents “incorporating everything we’ve come to agreement on” “for final review and then signatures, so we can get this thing moving.” After several disagreements, LoRoad stated “We do want you guys to create this vehicle however we are no where near having the documents done . . . and while you have our commitment in the form of a $120k deposit, that in no way means that you have an agreement with us until the final documents are signed, sealed and delivered properly.” The relationship further deteriorated and, with the project underway, LoRoad filed suit to compel arbitration, invoking the arbitration provision in the Agreement. GXV denied a valid, enforceable agreement to arbitrate. The district court held that LoRoad failed to accept the Agreement signed by GXV so that it could not enforce the arbitration provision in that Agreement. The Eighth Circuit affirmed. View "LoRoad, LLC v. Global Expedition Vehicles LLC" on Justia Law

Union Electric is a power company, and EIM is a trade-association-owned excess carrier for power companies. Union, as an association member, is a partial owner of EIM and is the named insured in a $100 million excess liability policy issued by EIM. Union and other power companies drafted the general form policy; Union negotiated the present policy with EIM. The policy requires that coverage disputes go through a mini-trial and arbitration. An exclusive forum-selection clause and a choice-of-law clause named New York. After failure of a Missouri reservoir caused extensive damage, Union paid to settle claims; EIM paid $68 million of the policy's $100 million limit. Union filed suit in Missouri seeking the remaining $32 million plus damages for breach of contract and vexatious refusal to pay. The district court dismissed, based on the forum-selection clause, The Eighth Circuit reversed and remanded for consideration of the relationship between the mini-trial requirement, the arbitration provision, and a public policy argument. On remand, the court denied the motion to dismiss, noting that arbitration agreements in insurance contracts are unenforceable under Missouri law and that contractual choice-of-law provisions have been held unenforceable if they would allow enforcement of such an agreement. The Supreme Court, in a different case, subsequently supported enforcement of contractual forum-selection clauses "[i]n all but the most unusual cases." Relying on that case, EIM moved for a transfer stating that it would not seek enforcement of the arbitration provision. The court held that the motion was not untimely and that the forum-selection clause was enforceable. The Eighth Circuit denied a writ of prohibition or mandamus to prevent the transfer, stating that Union did not establish entitlement to extraordinary relief. View "Union Elec. Co. v. Energy Mut. Ins. Ltd." on Justia Law

Unison, a South Korean company, manufactures, sells, delivers, and services Wind Turbine Generators (WTGs). JEDI is incorporated and located in Minnesota. In a Turbine Supply Agreement (TSA), Unison agreed to design, manufacture, and sell two WTGs to JEDI for installation in Minnesota for $2,574,900. In a Financing Agreement (FA), Unison agreed to lend to JEDI the TSA contract price. Unison sued JEDI in federal court in Minnesota, asserting 17 claims for relief under the FA. JEDI moved to compel arbitration, based on an arbitration clause in the TSA. The district court denied the motion. The Eighth Circuit reversed, concluding that the arbitration clause in the TSA covers the dispute. The court noted multiple cross-references, and the interdependent nature of the parties’ obligations under both the TSA and the FA, and concluded that they are “two parts of one overarching business plan between the same parties.” View "Unison Co., Ltd. v. Juhl Energy Dev., Inc." on Justia Law

Weitz contracted with Hyatt to build an Aventura, Florida assisted-living facility, which was completed in 2003. Hyatt obtained post-construction insurance from defendants. Weitz was neither a party nor a third-party-beneficiary. The policies exclude faulty workmanship and mold, except to the extent that covered loss results from the faulty workmanship, such as business interruption losses. The construction was defective. Hyatt notified defendants of a $11 million loss involving moisture and mold at the care center, settled that claim for $750,000, and released defendants from claims relating to the care center. Hyatt next discovered moisture, mold, and cracked stucco at the residential towers. Hyatt gave defendants notice, but bypassed inevitable defenses based upon policy exclusions, and sued Weitz. Weitz sued its subcontractors and its own construction contract liability insurers. Weitz settled with Hyatt for $53 million and was indemnified by its insurers for $55,799,684.69. Weitz sued, claiming coverage under defendants’ policies, based on equitable subrogation or unjust enrichment. The Eighth Circuit affirmed dismissal, recognizing that Weitz, as subrogee, was subject to any defense Hyatt would have faced, and that Hyatt had discharged defendants from liability; that suit was barred by the contractual period of limitations; that Weitz was barred from suing for damage to the plaza because Hyatt did not give defendants notice of that damage; and that Weitz had already collected several million more than it paid. View "Weitz Co. v. Lexington Ins. Co." on Justia Law

United operates a nationwide household goods moving network with more than 400 independently owned and operated agents. Since 1993, Chavis has been a full-service United agent. The parties' relationship is governed by a 2007 Agency Agreement. Chavis filed suit for breach of contract, alleging that United breached the Agency Agreement by unilaterally changing the roles that United agents play in servicing shipments by not assigning Chavis to certain roles in the chain of interstate shipments. According to Chavis, it should have been assigned the roles of origin agent and destination agent, based on its status as the "local" or "authorized" agent in the case of non-military shipments, i.e., its status as the agent closest to the original or destination address, and based on its designation as the United agent "authorized" to service Shaw Air Force Base in South Carolina for military shipments. The district court entered summary judgment for United, finding the Agreement unambiguous. The Eighth Circuit affirmed. None of the documents that Chavis identified supported its argument that it is the only "authorized" agent for its home market for non-military shipments or the exclusive agent for military shipments to and from Shaw AFB. View "Chavis Van & Storage of Myrtle Beach, Inc. v. United Van Lines, LLC" on Justia Law

Expander Global conducts no business and is merely a holding company for its wholly owned subsidiary, Expander SystemSweden, another Swedish corporation. Expander Sweden wholly owns Expander Americas. Those companies manufacture industrial pins used in heavy machinery. In 2010, Eagle entered into an Independent Contractor Agreement with Expander Americas to provide consulting services. The Agreement led to a relationship between Global and Bakker, Eagle’s sole owner, who acted as a project manager and as secretary of the Global Board of Directors. In 2011, Global terminated Bakker from his positions and its agreement with Eagle. Eagle sued Expander Americas, alleging breach of contract and promissory estoppel; Bakker sued Global for quantum meruit. The district court dismissed the quantum meruit action for lack of personal jurisdiction, finding that Global did not have the requisite minimum contacts with Missouri to be subject to its Long-Arm Statute or to satisfy due process. It was not licensed to do business in the state; it did not advertise within the state; it did not send employees to the state; and no money was received or sent to the state. The court granted Expander Americas summary judgment on the remaining claims, based on the statute of frauds. The Eighth Circuit affirmed. View "Eagle Tech. v. Expander Americas, Inc." on Justia Law

Robl and Homoly formed the Company to develop real estate. Robl held a 60% share and Homoly held 40%. Steve Robl was the tax matters partner; his wife, accountant Vera Robl, assisted with financial records; Homoly was a project manager. From 2006-2011, the Company operated at a loss. Robl periodically advanced money. The operating agreement required the consent of both members before “creation of any obligation or commitment of the Company, including the borrowing of funds, in excess of $10,000; [and] . . . . Any act which would cause a Member, absent such Member’s written consent, to become personally liable for any debt or obligation of the Company.” Vera notified Homoly that the Company needed “to make a capital call or increase loans on existing inventory,” that Robl had “put in $71,500 so if you go the route of capital call, your share to get caught up would be $47,666.” Homoly responded, “I would prefer the money from Robl to be considered a loan ... If Steve would rather me put in a capital call, however, I will … write the check.” In 2011, Robl sued for breach of contract, seeking $172,617.61. The district court entered summary judgment, finding that Homoly did not personally guarantee any loan. The Eighth Circuit reversed. The record showed that the parties genuinely dispute whether Homoly authorized Robl’s loan and personally guaranteed repayment. View "Robl Constr., Inc. v. Homoly" on Justia Law

In 2004, Streambend signed agreements to purchase two units in a Minneapolis residential condominium development, Ivy Hotel + Residences. Completion of the units was delayed, two additional floors were added without proper disclosure, and earnest moneys were removed from the trust account to pay construction costs without Streambend’s permission. Mechanics liens were filed in 2008 and not removed. Streambend requested return of its earnest moneys in 2009, but, defendants claimed the deposits were non-refundable. Streambend sued, alleging state law contract, fraud, and statutory claims and violations of the Interstate Land Sales Full Disclosure Act (ILSA), 15 U.S.C. 1703(a)(2). The initial defendants were the developers, their real estate agent, and the title company, as escrow and disbursing agent. The district court dismissed ILSA claims against the developers for failure to plead fraud with the required specificity; granted summary judgment dismissing the ILSA claims against the title company on the merits; and declined supplemental jurisdiction over the state law claims. The Eighth Circuit affirmed, upholding refusals to permit Streambed to re-add a party whose prior dismissal on the merits was not challenged in an earlier appeal and to permit further amendment of the complaint. View "Streambend Props. II, LLC v. Ivy Tower Minneapolis, LLC" on Justia Law

Menard operated a store in a building subleased from Wal-Mart. In 2006, Menard entered into a Purchase Agreement (PA) with Dial; Clauff signed as a managing member of Dial. Menard planned to build a store and wanted to be relieved of its obligations under the sublease. Menard and Dial agreed that Dial would assume responsibility for the sublease after Menard opened its new store. With Wal-Mart’s consent, DKC (Chauff's other LLC) and Menard executed an Assignment. Clauff purported to sign as a member of DKC. DKC did not file Articles of Organization until later. Clauff and Menard claim, but neither provided evidence, that DKC adopted the Assignment after the company formed. Menard remained secondarily liable. Menard opened its new store in 2008. When the Sublease expired in 2011, Wal-Mart was owed more than $700,000. Menard paid $350,000 and sued Dial, DKC, and Clauff. The district court granted summary judgment, finding Clauff liable under Nebraska Revised Statute 21-2635: "[a]ll persons who assume to act as a limited liability company without authority to do so shall be jointly and severally liable for all debts and liabilities of the company." The Eighth Circuit reversed for determination of whether common law or section 21-2635 preclude Clauff's argument that his liability may be avoided because DKC adopted the contract and commenced performance. View "Menard, Inc. v. Clauff" on Justia Law