Ninth Circuit: Abraham Bielski v. Coinbase Inc.

 As long as the challenge to the arbitration agreement mentions the delegation provision and makes arguments against it, the threshold requirement of ensuring that the challenge is within statutory limits is met. In evaluating an unconscionability claim under state law, a court must necessarily look to the entirety of the arbitration agreement.

Although the agreement is per se procedurally unconscionable to some degree as a contract of adhesion, the dispute-resolution processes are not unduly surprising. Under state law, a one-sided agreement lacking mutuality of remedy is not inherently substantively unconscionable.  In this case, not overly harsh or one-sided.

CONCURRENCE, CONCURRENCE IN JUDGMENT

The precedent cited to the contrary in other circuits, in which a court looks to the substance of the challenge in the threshold analysis, is not meaningfully distinct from considering whether arguments were made against the provision.

Abraham Bielski v. Coinbase Inc.

Third Circuit: Maria Del Rosario Hernandez v. MicroBilt Corp

 When the arbitration association designated in the consumer contract refuses to arbitrate due to the company's refusal to waive a damages limitation inconsistent with its charter, it isn't a matter of arbitrability that might have to be formally decided by an arbitrator, but a threshold requirement properly decided by the association itself.  It speaks to how the agreement operates, rather than whether it applies.

Plaintiff's court claim is not prohibited by the Exclusive Resolution term of the contract, as the plaintiff complied with all arbitration provisions, and claimants can return to court after an arbitration concludes. The return to court is without consideration of the merits of the arbitration, and further arbitration can't be compelled under the contract.

Maria Del Rosario Hernandez v. MicroBilt Corp

First Circuit: Gibson Foundation, Inc. v. Norris

 As a reasonable finder of fact could determine that the agreement to keep the piano in the warehouse was a consensual agreement that ultimately benefitted both parties, and under state law, claims regarding bailments can be subject to either the contract-claim or tort-claim statute of limitations, there exists an issue for trial as to whether the shorter limitation term applies.

Possession is sufficient for rebuttable proof of ownership at the time of the creation of the bailment; ownership, and therefore the validity of the bailment, therefore presents a genuine issue of material fact for trial.

A reasonable juror could find that the acceptance of the piano created an enforceable contract, as the owner of the piano saved storage costs, making for sufficient consideration. The term of the contract need not have been definite; possessing it until it was requested by the owner would be sufficient.

Genuine issue for trial as to ownership, given corporate succession beforehand; employee's statement that the piano would be "all yours" if picked up states a claim for transfer of ownership.

 Gibson Foundation, Inc. v. Norris

Tenth Circuit: Team Industrial Services v. Zurich American Insurance Company, et al.

 Second company that assumed the obligations of a first company by a series of agreements consolidating and retiring the earlier agreements was not covered under the insurance of the counterparty, as the new agreements set such coverage at the discretion of the counterparty.  Use of the first company's credentials by the second company to file insurance paperwork insufficient to offset.  No cause for reformation absent evidence that the counterparty had any other intent.  If there was a fiduciary duty of the counterparty, it was owed only to the first company.  Promissory estoppel unjustified.

Team Industrial Services v. Zurich American Insurance Company, et al.

Eleventh Circuit: Southern Coal Corporation, et al v. Drummond Coal Sales, Inc.

 District court properly considered industry usage in determining whether a certain term was ambiguous, ultimately basing its judgment upon finding both the specific referent and the industry benchmark to be reasonable readings.

Agreement not susceptible of reformation, since the claimed error was the mutual mistake of sophisticated parties, so there's no basis for saying that the present agreement doesn't reflect the original intentions of the agreement.

District court abused its discretion in denying fees, as the movant prevailed on their central claim.

Counter-party's refusal to proceed under an industry benchmark once the specific rate-setting mechanism ceased to exist wasn't an anticipatory repudiation, since they were still performing their unaffected obligations under the contract. Since the dispute went to pricing and not the special purpose of the contract, neither was it a material breach of the contract.

CONCURRING IN PART, CONCURRING IN THE JUDGMENT:

The question on fees isn't whether a party was a prevailing party, but whether, under the contract, a party was a defaulting party.

Southern Coal Corporation, et al v. Drummond Coal Sales, Inc.

Seventh Circuit: Indigo Old Corp., Inc. v. Thomas Guido

 Since the guarantor's obligation was part of an obligation subordinated to a second debt, the lender can't proceed against the guarantor until the second debt is retired and the subordinated obligation comes due.  Under state law, the fact that the debt was subordinated by a contemporaneous instrument means that the subordination didn't count as a modification of the guaranteed obligation that would trigger the guarantor's obligation.

Indigo Old Corp., Inc. v.   Thomas Guido

First Circuit: Puerto Rico Farm Credit, ACA v. Eco-Parque del Tanama Corp.

Statute requires that the lender attempt a restructuring of the loan obligations only where the restructuring ultimately proves less costly than foreclosure; borrower's inability to demonstrate means for a satisfactory repayment removed the requirement.

Under the statute, a lender must consider the restructuring plan's credibility and viability, and need not accept a plan that the counterparty can't perform.

Putting forward a credible plan for restructuring is a threshold requirement for challenging the lender's estimated foreclosure costs.

Puerto Rico Farm Credit, ACA v. Eco-Parque del Tanama Corp.

Seventh Circuit: K.F.C. v. Snap Inc.

 As, under state law, the voidable aspect of an infant's contract is a defense against performance, not a bar to formation, the arbitration waiver within the contract is therefore valid, and questions of whether enforcement would be against public policy is within the scope of arbitration.

 K.F.C. v.   Snap Inc.

Sixth Circuit: Laborers' Int'l Union of N.A. v. Terease Neff

 The court whose employees have joined a union is a state, not county, entity for purposes of sovereign immunity, given its constitutional and statutory designation within the state.  The fact that the state has mandated that the county fund the operations of the court and that the county has discretion in setting the salary levels of the employees supports this, as the mandate is from the state.  As the elected state judge exercises ultimate authority in discharging and retaining employees and sets salaries in the first instance, the employment functions of the court are a state matter.  

The Contracts Clause is an insufficient basis for S1983 claims.  

A Takings Clause injunction would require that there was no remedy sounding in contract; mere breach of contract doesn't state a claim for damages under the Clause.  

CBA term in preamble holding that it remains in force until union is decertified or another agreement is reached insufficient to defeat as a matter of law a specific end date in the terms.

Laborers' Int'l Union of N.A. v. Terease Neff

Second Circuit: JN Contemporary Art LLC v. Phillips Auctioneers LLC

 Force majeure clause could be invoked to cancel the contract; there was no obligation to reschedule or change the manner of performance.

The catch-all term of the force majeure clause justified the cancellation, even under strict construction; eusdem generis reading of the enumerated grounds implies that any societal disruption not due to fault or negligence and beyond the parties' control qualified.

Discretionary postponement of performance according to state advisory guidance was a de minimis breach, if at all, since by the time of scheduled performance, the state had issued compulsory guidance.

Absent explicit language of condition, courts can't look beyond integrated agreements to infer that one is conditional upon performance of the other.

Violation of the covenant of good faith and fair dealing doesn't state a claim where it is based on the same theory and facts as the breach claim.

JN Contemporary Art LLC v. Phillips Auctioneers LLC

Eighth Circuit: Ascente Business Consulting v. DR myCommerce

 

Proof that a company had certain knowledge prior to its employees' contrary statements is insufficient to state a fraud or fraud-adjacent claim under the state's heightened pleading rules.  

Evidence that work stopped after a certain meeting can't speak to the mindset of statements made at that meeting.  Evidence of a contrary financial interest is at most only a factor, as is the amount of work that it would have taken to accomplish the task.

Expert testimony on ambiguity of contract terms is inadmissible, as ambiguity is a legal conclusion.

Given testimony that the overruns were paid to preserve the business relationship, there was no question for trial on the reliance on the underlying representations. Under state law, the counterparty's expectations of the plaintiff's reliance are insufficient to establish the plaintiff's reliance.

http://media.ca8.uscourts.gov/opndir/21/08/202474P.pdf

Third Circuit: Dianoias Eatery LLC v. Motorists Mutual Insurance Co

 

The existence of unfiled potential legal claims arising from the same circumstances does not mean that a court lacks statutory jurisdiction to issue a requested declaratory judgment; under the statute, such claims aren't waived by seeking declaratory judgment as to the allocation of rights and responsibilities, and can be raised in a subsequent action.

Circuit precedent requiring the court to consider the redress from a federal court judgment doesn't implicate the effect of federal rulings on state law, but looks to the ability of a court to accord final relief to the parties.

Circuit precedent requiring the consideration of the litigation of identical issues in state court assumes identity of parties as well.

Even within the context of the pandemic, the issues raised here are generic issues of contract and policy exclusion interpretation, making a prudential remand on the ground of undetermined state law unjustified.

Since the state courts have no legislative priority in matters of public health, balancing policy exclusions against state public policy interests is not peculiarly within the jurisdiction of the state courts.

DISSENT

Factors relevant to prudential abstention aren't exhaustive; states need to fashion a comprehensive plan to recover from the pandemic; federal speculation on state law risks undue delay.

https://www2.ca3.uscourts.gov/opinarch/202954p.pdf

Third Circuit: Insurance Co of the State of Pennsylvania v. Alfred T. Giuliano

 

The suretyship for the construction contract was not discharged at tender letter, occupancy, or final completion nof the structure, but by the final payments to the completion contractor; the obligee therefore held the superior interest to the assets of the defaulting party, and could waive its claim to the defaulting party's tax refund.

Settlement order explicitly referencing the tax refund and holding that nothing in the settlement could limit any interest of the surety in the refund preserved no interest, as the suretyship had not acquired its priority interest prior to the settlement agreement.

https://www2.ca3.uscourts.gov/opinarch/203057p.pdf

Ninth Circuit: Dennis Munden v. Stewart Title Guaranty Co.

Since the roadmaps were created under a state statute and designed, at least in part, to give owners in property notice of extant interests in their property, the road map is a public record for the purposes of the title insurance contract, and the insurers had a duty to defend the landowner against the otherwise unrecorded state road easement and right of way.

Policy exclusion for claims arising from public interests in roads applies to bar the claim, since the state is asserting such an interest, and the policy owner is opposing it.

One deft to pay the plaintiff's costs, and the plaintiff to pay the prevailing deft's costs.

https://cdn.ca9.uscourts.gov/datastore/opinions/2021/08/13/20-35336.pdf

Eighth Circuit: J.B. Hunt Transport, Inc. v. BNSF Railway Company

 

Arbitration party's pre-confirmation suit sought declatory judgment as to a specific finding and specific performance as to a specific term, rather than enforcement of the award generally, and therefore wasn't untimely.

Suit wasn't moot due to the expected confirmation of the award, since it would give the plaintiff something beyond the confirmation.

The request for specific performance, however, would constitute a modification of the award contrary to the arbitration statute.

Award's definition of certain terms was exclusive, given the clear decision and the lack of language indicating otherwise in the award.

Where the terms of the Award are ambiguous as to which rates the competitor must disclose to its JSA partner, a fair resolution looks to those rates that are most relevant to the substance of the JSA.

http://media.ca8.uscourts.gov/opndir/21/08/202679P.pdf

Second Circuit: Div. 1181 Amalgamated Transit Union-New York Emps. Pension Fund v. New York Dept of Education

 

Municipality that contracts with outside corporations isn't liable under ERISA for fund contributions, as contributions aren't required in the contracts or in the Fund's governing documents.  Munciplaity's requirement that contractors hire according to municipality's seniority lists and follow municipality's wage and labor rules constituted neither an ERISA pension agreement or CBA, nor is the munipality a fiduciary or liable due to having participated in prohibited transactions.

https://www.ca2.uscourts.gov/decisions/isysquery/b3c5ec72-ddd7-427e-a6e6-2cf21cacd5eb/3/doc/20-4012_opn.pdf#xml=https://www.ca2.uscourts.gov/decisions/isysquery/b3c5ec72-ddd7-427e-a6e6-2cf21cacd5eb/3/hilite/

DC Circuit: BCP Trading and Investments, LLC v. Cmsnr. IRS

 

Investigation of accountancy firm did not create a situation of undue contractual influence on the taxpayers, as some had multiple advisors, and some were sophisticated business professionals; the accountancy firm notified the taxpayers of the investigation in a manner that allowed for outside advice on at least some of the relevant transactions.

For purposes of determining whether the partnership was a sham, while the correct business purpose test is distinct from the court's intent-based test, the two are not mutually exclusive, since intent is necessary to prove business purpose.  The transaction had no practical economic effects other than the creation of intentional artificial tax losses.

Tax court's refusal to allow intervenor is reviewed for clear abuse of discretion, given the broad FRCP rule and the court's procedural discretion.  Denial of intervention of right or denial of permissive intervention would both have been appropriate, given the existing representation of interests.

BCP Trading and Investments, LLC v. Cmsnr. IRS

First Circuit: Emmanuel v. Handy Technologies, Inc.

 

Independent contractor sufficiently manifested assent to clickwrap terms of service containing an arbitration provision, despite the fact that the button clicked to accept the agreement wasn't at the end of the document.

Claim of unconscionability arising from the terms' unilateral modification provision does not address the threshold question of scope of arbitration, and is reserved in the first instance to the  arbitration.

 Emmanuel v. Handy Technologies, Inc.

Third Circuit: In re: Orexigen Therapeutics, Inc.

 

Under the Code, sufficient mutuality for offset of pre-petition monies mutually owed cannot be created by contract in a triangular offset; the claim on the funds is a personal one, and one tied to the identity of the claimant.

The second party also can't transform the contract into a claim.

(Perhaps.  We don't know many things, but we especially don't know Patent and Bankruptcy.  Entertainment value only, folks.)

In re: Orexigen Therapeutics, Inc.

Third Circuit: Dansko Holdings Inc v. Benefit Trust Co

 

Employer's contract claim against potential trustee of employee stock benefit plan is remote from the usual ERISA concerns, and therefore not preempted by the statute.

Implied spoken promise subsequent to execution of written contract can be the basis for a promissory estoppel claim.

Integration clause refers only to the time of formation -- when subsequent parties to the contract were substituted in, the integration clause still looked back to the time of initial formation.

A lie about a side issue in the course of a contractual breach is separately actionable as fraud where the lie implicates a broader social duty owed to all individuals.

By conceding valid substitution into the contract for the purposes of the breach claim, the plaintiff is estopped from arguing that the indemnification agreement compelling the payment of legal fees doesn't apply to the defendant.  Plain meaning of indemnify encompasses first party claims.  Under state law, it wouldn't be specific enough to cover any damages award.

Dansko Holdings Inc v. Benefit Trust Co