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

Plaintiff and his wife (the Kaplans) filed suit against Mayo Clinic Rochester, Inc., other Mayo entities (collectively, Mayo), and Mayo doctors David Nagorney and Lawrence Burgart, making a number of claims arising out of plaintiff's erroneous diagnosis of pancreatic cancer and plaintiff's surgery based on that diagnosis. The Kaplans subsequently appealed the judgments in favor of Mayo and Dr. Burgart on their negligent-failure-to-diagnose and contract claims. The court held that the error, if any, in admitting a certain medical file, which included insurance documents, into evidence did not affect the Kaplans' substantial rights and the Kaplans were not prejudiced by the district court's decision not to give a limiting instruction. The court agreed with the district court that the Kaplans' assertion that the biopsy slides might have been tampered with was based on rank speculation where they failed to present evidence that the slides had been changed in any way. The court also held that the Kaplans have shown no basis for granting them a new trial on their claim for negligent failure to diagnose. The court held, however, that the district court erred in granting judgment as a matter of law where the Kaplans have offered sufficient evidence in their case-in-chief to support a breach-of-contract claim. Accordingly, the court affirmed in part, reversed in part, and remanded for further proceedings.

The owners of Landmark Towers appealed the district court's grant of summary judgment in favor of Green Tree Servicing, LLC (Green Tree), permitting Green Tree to vacate office space it subleased from the owners' tenant (DBSI). The lease agreements at issue in this case arose from a complex real estate transaction that DBSI and its affiliates commonly structured in order to generate revenue. DBSI, a tenant in common syndicator, or an affiliate - here DBSI Landmark, LLC - acquired commercial property and leased it to another affiliate - here DBSI Leaseco. The court found that, irrespective of 11 U.S.C. 365(h), principles of contract law dictated that DBSI Leaseco and Green Tree were no longer required to perform their obligations to each under the sublease. The court also found that the sublease contained promises between the tenants in common (TIC) and Green Tree via the attornment provision and therefore, the parties were in privity of contract regardless of their status as master landlord and sublessee. The court further found that the only surviving contractual interest in the sublease was the TIC's right to attornment, which was triggered only when the TIC succeeded to the interest of DBSI Leaseco. Therefore, the sublease did not require Green Tree to attorn to the TIC here.

This case concerned the bankruptcy estate of Qualia Clinical Service, Inc. The estate's Chapter 7 Trustee sought to avoid as a preferential transfer a security interest recorded by one of Qualia's creditors shortly before the bankruptcy petition. The bankruptcy court and the Bankruptcy Appellate Panel (BAP) held the security interest voidable. The court held that the bankruptcy court and the BAP properly applied 11 U.S.C. 547(c)(5)(A) to conclude that the preferential transfer in this case, though it concerned an interest in accounts receivable, improved Inova Capital Funding, LLC's position as against Qualia's other creditors and so was not exempt from avoidance under that subsection. The court found Inova's remaining arguments unpersuasive.

Plaintiff appealed the district court's grant of summary judgment to defendant on his claim of malicious prosecution under Arkansas law. The district court held that plaintiff failed to present evidence sufficient to withstand summary judgment on two of the five elements necessary to sustain his claim. The court held that the district court erred in holding that the evidence was insufficient as a matter of law to sustain plaintiff's claim that defendant brought suit against him on the guaranty without probable cause. The court also held that a jury must decide what was defendant's motive or purpose in suing plaintiff if it in fact understood it had no reasonable chance of prevailing on the merits of its claim against plaintiff.

Appellant appealed the district court's orders granting summary judgment in favor of the City of Lake Lotawana, and its mayor, and the subsequent dismissal of her wrongful termination and retaliation claims. On appeal, appellant contended that the city breached her employment contract and that she established triable issues of fact as to her retaliation claims. The court held that the city was entitled to summary judgment on appellant's wrongful termination claim where she did not have an enforceable contract or viable tort claim. The court also held that appellant was terminated because of her inappropriate activities and therefore, the dismissal of appellant's retaliation claims was affirmed because nothing in the record indicated that her opposition to unlawful discrimination was a contributing factor to her termination. The court further held, for the same reasons, that appellant could not succeed under the more stringent standard applied in the Title VII and Age Discrimination in Employment Act (ADEA), 29 U.S.C. 621 et seq., claims. Accordingly, the court affirmed the judgement of the district court.

Appellant appealed the bankruptcy court's approval of a multi-million dollar, global settlement in one of the largest Ponzi scheme bankruptcies in American history. The settlement had been substantially consummated and the appeal had been rendered largely moot. The court held that the bankruptcy court did not abuse its discretion in approving the settlement where the record upon which the bankruptcy court based its approval of the settlement was sufficient and where the settlement satisfied the Flight Transportation/Drexel factors. Accordingly, the order of the bankruptcy court approving the settlement was affirmed.

Liberty Mutual sued Pella in the district court for declaratory judgment where the suit was sought to determine the scope of Liberty Mutual's obligation, under general commercial liability (GCL) policies issued to Pella, to reimburse Pella's defense costs in two underlying lawsuits. Both parties appealed the judgment of the district court. The court held that the district court did not err in concluding that Liberty Mutual's duty to reimburse Pella's defense costs should be determined by looking at the allegations in the complaint to determine if they stated a covered claim where Liberty Mutual would still have no duty to defend even if it had to reimburse defense costs in a suit where an "occurrence" was alleged but not yet an established fact. The court also held that because the underlying suits did not allege an "occurrence," Liberty Mutual did not owe Pella a duty to reimburse its costs in defending either action. Therefore, the court need not address Liberty Mutual's alternative argument. The court further held that the district court did not commit reversible error in granting summary judgment to Liberty Mutual. The court finally held that, in light of its conclusion that Liberty Mutual had no duty to reimburse Pella's defense costs in the underlying suits, the court need not address the issue of defense costs. Accordingly, the court affirmed the district court's grant of summary judgment to Liberty Mutual on Pella's bad-faith counterclaim. The court reversed the district court's order granting summary judgment to Pella on Liberty Mutual's claim for declaratory judgment and remanded with instructions to enter declaratory judgment in favor of Liberty Mutual.

Plaintiffs filed this diversity action to foreclose a contractor's lien and an architect's and engineer's lien against Phoenix Land & Acquisition, LLC (Phoenix Land) and Phoenix Health, LLC (Phoenix Health), as owners of the property in dispute, and three financial institutions with recorded security interests in the property. Phoenix Land filed a counterclaim, asserting breach of contract, negligence, breach of implied warranty, breach of fiduciary relationship, and deceptive trade practices by plaintiffs. Plaintiffs appealed the district court's order denying their motion to compel arbitration of Phoenix Land's counterclaim. The court held that the district court did not err in finding plaintiffs' motion to compel arbitration on the ground that they had waived their right to arbitrate the dispute; they knew of the right and acted inconsistently with that right; and Phoenix Land suffered prejudice by plaintiffs' inconsistent actions. Accordingly, the court affirmed the judgment of the court.

The Andersons appealed the grant of summary judgment by the district court in favor of Hess Corporation (Hess), the successor in interest to and lessee of mineral rights on the Andersons' land. The Andersons contended that the district court erred in construing the five leases at issue as requiring Hess to engage in "drilling operations" rather than actual "drilling" in order to extend the primary terms of the leases and granting Hess's motion for summary judgment. The court held that the district court did not abuse its discretion in declining to certify the Andersons' question regarding the meaning of the phrase "engaged in drilling or reworking operations." The court also held that this disputed lease language was not ambiguous and meant "engaged in drilling operations or reworking operations." Therefore, the district court correctly interpreted the disputed lease language and properly granted summary judgment in favor of Hess on the Andersons' quiet title claim.

Auto Owners Insurance Company (Auto Owners) appealed an order granting summary judgment in favor of appellee and awarding her $124,500, the face value of the insurance policy sold to her by Auto Owners. Because Schubert owned a one-half interest in the dwelling covered by the policy, which was completely destroyed by fire, Auto Owners offered to pay her half of the policy value. Auto Owners cited a provision within the policy which limited recovery to "[no] more than the insurable interest the insured had in the covered property at the time of the loss." The district court declared this provision void as contrary to the public policy expressed in the Missouri valued policy statute, Mo. Rev. Stat. 379.140, and alternatively found its language ambiguous so as to allow appellee to recover the face value of the insurance policy. The court agreed with the district court's conclusions as to both points and affirmed the judgment. The court also held that, after initially questioning its jurisdiction over the matter, the case satisfied the $75,000 amount-in-controversy requirement and jurisdiction was proper.