Justia U.S. 4th Circuit Court of Appeals Opinion Summaries

Articles Posted in Contracts

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Lord & Taylor filed suit against White Flint, alleging breach of contract. Lord & Taylor operated a retail department store at the White Flint Shopping Center until White Flint closed the Mall and began demolition for a mixed use development. Lord & Taylor objected to the redevelopment, arguing that the clear terms of the parties' agreement required White Flint to maintain the Mall, and that the proposed mixed-use alternative would negatively affect its business. A jury found White Flint in breach of contract and awarded Lord & Taylor $31 million in damages. Both parties appealed. The court rejected White Flint's challenge to the damages award, concluding that the district court did not abuse its discretion by instructing the jury not to consider the potentially positive economic effects of the planned redevelopment in assessing damages for lost profits. Furthermore, the district court properly admitted a store executive's construction cost estimate as lay testimony. Finally, the court concluded that the district court committed no legal error or other abuse of discretion in applying long-established Maryland law to reject Lord & Taylor's claim to separate damages for the taking of property rights. Accordingly, the court affirmed the judgment. View "Lord & Taylor v. White Flint, L.P." on Justia Law

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Champion Pro filed suit against Impact Sports and others, principally alleging that Impact Sports engaged in deceptive and unfair practices in violation of the North Carolina Unfair and Deceptive Practices Act (UDTPA), N.C. Gen. Stat. 75–1.1, by their recruitment of a football player, Robert Quinn. The court affirmed the district court's denial in part of Champion Pro's motion for sanctions based on the alleged spoliation of evidence and grant of Impact Sports motion for summary judgment on all claims. The court agreed with the district court that Champion Pro's allegations, even when assumed to be true, are insufficient to establish a violation of the UDTPA. Likewise, Champion Pro's civil conspiracy claim fails as a matter of law. Finally, Champion Pro's claim that the district court erred in failing to award sanctions in the form of an adverse jury instruction is moot. Accordingly, the court affirmed the judgment. View "Champion Pro Consulting Group v. Impact Sports Football" on Justia Law

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Dreamstreet sold a vacant lot for home construction and MidCountry financed the lot's purchase by a third party. This case arose from the "seller holdback" agreement between Dreamstreet and MidCountry, where part of the purchase price owed to Dreamstreet instead would be retained by MidCountry, pending completion of the home and subject to certain conditions. Dreamstreet alleged that MidCountry fraudulently induced it to enter into the seller holdback agreement, in violation of North Carolina’s Unfair and Deceptive Trade Practices Act (UDTPA). Dreamstreet also alleged a claim under the common-law doctrine of constructive fraud. The district court granted summary judgment to MidCountry. With respect to the UDTPA claim, the court concluded that the district court properly granted summary judgment to MidCountry on statute of limitation grounds. The court also concluded that the undisputed facts of this case reveal an ordinary contractual relationship, with nothing that could give rise to a special fiduciary relationship. Because the existence of a fiduciary relationship is a necessary element of constructive fraud, the district court properly granted summary judgment to MidCountry on this claim. Accordingly, the court affirmed the judgment. View "Dreamstreet Investments, Inc. v. MidCountry Bank" on Justia Law
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The parties are involved in a dispute over a 12-year commercial lease of office space in Baltimore, Maryland. NCO, the lessee, claims that it properly exercised a right of early termination of the lease and that, during the course of the lease, it was overcharged for rent based on erroneous calculations of the space’s square footage. Montgomery Park, the lessor, claims that NCO failed to satisfy the lease’s specific conditions for early termination and that NCO now owes rent for the remainder of the lease term. The court reversed the district court’s ruling that NCO effectively exercised the right of early termination, and affirmed its ruling rejecting NCO’s overcharge claims. Accordingly, the court remanded for further proceedings on Montgomery Park’s claim that NCO breached the lease agreement in failing to pay rent. View "NCO Financial Systems, Inc. v. Montgomery Park, LLC" on Justia Law

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Amy Tuschen worked for RLM for six years and then joined a competitor, eScience. RLM filed suit against eScience and Tuschen, alleging principally that Tuschen breached a covenant not to compete and unlawfully took confidential information from RLM and shared it with eScience. The district court granted summary judgment to defendants. The court concluded that the covenant not to compete was not enforceable because it was overbroad, and RLM failed to present sufficient evidence that Tuschen took or shared RLM’s confidential information. The court rejected RLM's remaining claims and affirmed the judgment. View "RLM Communications v. Tuschen" on Justia Law

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As part of a joint effort to construct a Zoroastrian worship center, the parties signed a ninety-nine-year lease on a parcel of property owned by Rustam Guiv in the Vienna area of Fairfax County, Virginia. After Rustam Guiv terminated the lease, the Center filed suit seeking a declaratory judgment to reinstate the lease. After removal, the district court granted summary judgment to Rustam Guiv and awarded attorneys’ fees. The court concluded that Rustam Guiv presented sufficient evidence to show complete diversity between the parties, thereby establishing subject matter jurisdiction in federal court. The court also concluded that the undisputed material facts show that The Center breached the lease. Therefore, the court affirmed the district court's dismissal of the complaint in its entirety. The court concluded, however, that the attorneys' fee award must be vacated where the district court correctly identified Rustam Guiv as the prevailing party but made no effort to narrow the fee award to its successful claims. Under Virginia law governing contractual fee-shifting provisions, the prevailing party is entitled to recover attorneys’ fees for work performed only on its successful claims. View "Zoroastrian Center v. Rustam Guiv Found." on Justia Law

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Plaintiff filed suit against Santander, seeking damages for breach of contract and alleging a violation of the Maryland Credit Grantor Closed End Credit Provisions (CLEC), Md. Code, Comm. Law 12-1001, et seq. The dispute stemmed from plaintiff's use of a loan she obtained through a retail installment contract (RISC) to finance the purchase of a vehicle. The court concluded that the district court correctly enforced the parties' arbitration agreement because the district court properly concluded that the arbitration agreement was a term of a contract that the parties entered into, and that the arbitration agreement was enforceable under the Federal Arbitration Act, 9 U.S.C. 2. Accordingly, the court affirmed the judgment. View "Galloway v. Santander Consumer USA, Inc." on Justia Law

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Plaintiff filed suit alleging that HRFC violated the Maryland Credit Grantor Closed End Credit Provisions (CLEC), Md. Code Ann., Com. Law 12-1001 et seq., breached a retail installment sales contract, and violated the Maryland Consumer Debt Collection Act (MCDCA), Md. Code. Ann., Com. Law 14-201 et seq. The district court granted summary judgment to HRFC. The court held that HRFC’s mere failure to disclose an interest rate below CLEC’s statutory maximum is not a distinct violation of section 12-1003(a) for which liability may be imposed; HRFC complied with section 12-1020’s notice requirement and HRFC did not fail to properly cure its error; and the court rejected plaintiff's contention that because the contract incorporates CLEC’s provisions, HRFC is liable for breach of contract for any deviation from CLEC, “regardless of whether HRFC properly cured the failure to comply” with the statute. The court held, however, that a jury could find that HRFC's conduct, at least in the aggregate, could reasonably be expected to abuse or harass plaintiff. Accordingly, the court reversed the district court's order in regard to the MCDCA claim. The court affirmed as to the CLEC and breach of contract claims. View "Askew v. HRFC, LLC" on Justia Law

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Plaintiff Severn and its insurer filed suit against IFC, alleging breach of contract and negligence because IFC improperly applied a dangerous pesticide while fumigating Severn’s peanut dome, resulting in fire, an explosion, loss of approximately 20,000,000 pounds of peanuts, loss of business, and various cleanup costs. The court affirmed the district court's grant of summary judgment to IFC because the contract’s consequential damages exclusion bars Severn’s breach of contract claim, and because North Carolina does not allow Severn to veil that claim in tort law. View "Severn Peanut Co. v. Industrial Fumigant Co." on Justia Law
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Elderberry filed suit in the Western District of Virginia alleging breach of a lease for a skilled nursing facility against Living Centers, FMSC, and Continium, and breach of a guaranty contract against Mariner. Separately, in the Northern District of Georgia, Mariner filed a declaratory judgment action against Elderberry, seeking a declaration that it had no obligations under the guaranty. The two actions were consolidated in the Western District of Virginia. The district court denied the parties’ cross motions for summary judgment but held that the guaranty was enforceable against Mariner. The district court entered judgment in favor of Elderberry on all counts and found defendants jointly and severally liable for accrued and future damages, plus pre- and post-judgment interest. The court held that Elderberry lost its right to rent that accrued after it terminated the lease on August 24, 2012; Elderberry is, however, entitled to any rent that accrued prior to termination of the lease; and Elderberry is entitled to non-rent damages that accrued prior to termination of the lease. Given the Georgia Supreme Court’s most recent pronouncement on that state’s statute of frauds, combined with Georgia’s parol evidence rule, the court held that the guaranty satisfies the Georgia statue of frauds. Accordingly, the court affirmed in part, vacated in part, and remanded with instructions. View "Elderberry of Weber City, LLC v. Living Centers - Southeast" on Justia Law