Justia U.S. 10th Circuit Court of Appeals Opinion Summaries

The contracts at issue in this case related to Z3 Technology's design and manufacturing of circuit board modules for use in Digital Ally, Inc.'s products. The first contract, called for Z3 to design, manufacture, and deliver to Digital 1,000 modules incorporating Texas Instruments' DM355 computer chip. The second contract involved a larger quantity of modules that would use Texas Instruments' next-generation DM365 chip. Both contracts were signed by Robert Haler, who was then Digital's Executive Vice President of Engineering and Production. The contracts were described as "Production License Agreement[s]," and they expressly provided that the modules would be licensed, not sold, to Digital. The contracts both stated they would "be governed by and interpreted in accordance with the laws of the State of Nebraska, without reference to conflict of laws principles." Upon review of the contracts at issue in this case, the Tenth Circuit reversed and remanded for the district court to award prejudgment interest to Z3 on a damages award and unpaid design fees. All other portions of the district court's judgment were affirmed. View "Digital Ally, et al v. Z3 Technology, et al" on Justia Law

Plaintiff Higby Crane Service, LLC (Higby) entered into a Contract with Defendant DCP Midstream, LP that covered crane work to be done at the gas processing plant of DCP's wholly owned subsidiary National Helium, LLC (collectively, "DCP"). A fire negligently started by DCP damaged Higby's crane. The other Plaintiff, National Interstate Insurance Co. had issued Higby a commercial inland marine (CIM) policy covering direct physical loss to certain property. National paid Higby under the policy, and Plaintiffs then sued DCP for the loss. DCP counterclaimed that Higby had breached the contract by failing to obtain a commercial general liability (CGL) policy that would have indemnified DCP for its negligence and therefore Higby should bear the loss from the damage to the crane. The United States District Court for the District of Kansas granted summary judgment to Plaintiffs, and DCP appealed. Upon review, the Tenth Circuit reversed and remanded for further proceedings to determine whether the required CGL policy would have protected DCP from liability. View "National Interstate Insurance, et al v. National Helium, et al" on Justia Law

Defendants-Appellants Chesapeake Exploration, L.L.C., and Chesapeake Investments appealed a district court judgment awarding Plaintiff-Appellee BP America Production Company $22,265,302 plus interest, and a district court order compelling Chesapeake to pay $1,403,669.38 in attorneys' fees and disbursements. BP cross-appealed the district court order confirming an arbitration award. This dispute arose out of a purchase and sale agreement ("PSA") entered into by Chesapeake as seller and BP as purchaser of oil and gas properties for $1.75 billion. The PSA contained three arbitration provisions. After closing, the parties agreed on title defects. Less the aggregate threshold, the parties agreed BP was owed $81,234,556. At the same time, disputed title defects and benefits were submitted to title arbitration. BP sought approximately $46 million for disputed title defects, and Chesapeake sought approximately $22 million for disputed title benefits and "credits." While the title arbitration was pending, BP submitted a proposed final accounting statement reflecting the agreed title defects of approximately $80 million. Chesapeake responded with an exception report changing the $80 million to $58 million. When BP asked why, Chesapeake responded that it had applied a $22 million offset based on its pending claims in the title arbitration; Chesapeake did not dispute the $80 million in agreed title defects, but temporarily withheld the $22 million because it might recover that amount in title arbitration. Though the accounting arbitration ended, the title arbitration continued. The arbitration panel issued an award finding $11,526,434 in title defects (favoring BP), and $3,727,031 in title benefits (favoring Chesapeake). The arbitration panel noted that it made no determination of whether these amounts exceeded the aggregate threshold, or whether its ruling would actually cause any money to exchange hands. If the parties could not agree on the effect of the panel's ruling on the ultimate purchase price adjustment, they could submit their positions on that issue to further arbitration. Shortly thereafter, BP requested payment from Chesapeake. Because a $3 million in title benefits awarded to Chesapeake did not exceed the aggregate threshold, Chesapeake received no price adjustment to offset the $22 million it previously withheld. The parties filed competing motions to confirm in the district court. The court ultimately entered judgment in favor of BP for $22,265,302 plus interest. Chesapeake appealed that judgment. The district court later granted in part BP's motion for attorneys' fees and costs and awarded $1,403,669.38 against Chesapeake for fees and disbursements. Chesapeake appealed that judgment too. Upon review of the matter, the Tenth Circuit affirmed both awards in Chesapeake's direct appeals and dismissed BP's cross-appeal. View "BP America Production Company v. Chesapeake Exploration, LLC, et al" on Justia Law

Mid-Continent Casualty Company brought a declaratory judgment action to settle an issue with its commercial commercial general liability (CGL) policy issued to Pennant Service Company. In 2001, True Oil Company, an owner and operator of oil and gas wells, entered into a master service contract (MSC) with Pennant for work on a well in Wyoming. The MSC included a provision whereby Pennant agreed to indemnify True Oil resulting from either Pennant or True Oil's negligence. In July 2001, Christopher Van Norman, a Pennant employee, was injured in an accident at True Oil's well. Van Norman sued True Oil in Wyoming state court for negligence. In accordance with the MSC's indemnity provision, counsel for True Oil wrote to Pennant requesting indemnification for its defense costs, attorney fees, and any award that Van Norman might recover against it. Mid-Continent refused to defend or indemnify True Oil based on Wyoming's Anti-Indemnity Statute, which invalidates agreements related to oil or gas wells that "indemnify the indemnitee against loss or liability for damages for . . . bodily injury to persons." In May 2002, True Oil brought a federal action against Mid-Continent for declaratory relief, breach of contract (CGL policy), and other related claims. In February 2005, the district court granted Mid-Continent summary judgment, determining that the MSC's indemnity provision, when invoked with respect to claims of the indemnitee's own negligence was unenforceable as a matter of public policy. The court held that Mid-Continent was not required to defend or indemnify True Oil in the underlying suit as it then existed because "where an indemnification provision in a MSC is void and unenforceable, the insurer never actually assumed any of the indemnitee's liabilities under the policy." The district court granted summary judgment to True Oil, determining Mid-Continent breached its duty to defend and indemnify True Oil. As damages, the court awarded True Oil the amount it paid to settle the underlying suit and the attorney fees and costs incurred in defending itself. Mid-Continent appealed the district court's judgment. Finding no reversible error, the Tenth Circuit affirmed. View "Mid-Continent v. True Oil Company" on Justia Law

The case involves statements made by plaintiff Vehicle Market Research, Inc. (VMR) in a breach of contract case that were allegedly inconsistent with earlier statements by its sole owner, John Tagliapietra. VMR developed and owned certain intellectual property, including a software system to calculate the value of a total loss of an automobile for the purposes of the automobile insurance industry and certain “pre-existing software tools, utilities, concepts, techniques, text, research or development” used in the development of the software. When Mr. Tagliapietra filed for personal bankruptcy, he asserted that his shares in VMR were worth nothing. A few years later, as the bankruptcy was winding down, VMR sued Mitchell International, Inc., a company which held an exclusive license to VMR's technology. That case sought $4.5 million in damages for the alleged misappropriation of that technology. The question this case presented to the Tenth Circuit was whether the statements by VMR and Mr. Tagliapietra in the litigation against Mitchell were so clearly contrary to the statements made by Mr. Tagliapietra in his bankruptcy proceeding that VMR should have been judicially estopped from proceeding with its suit against Mitchell. After review, the Court concluded that neither VMR’s litigation claim for payments nor Mr. Tagliapietra’s deposition testimony in that lawsuit was clearly inconsistent with his valuation of 0.00 for his VMR stock at the time of his bankruptcy petition in 2005, the date when the initial bankruptcy representations were made. "If there were grounds for judicial estoppel, it would have to be based on a duty by Mr. Tagliapietra to amend his bankruptcy pleadings to report a possible increased value for his VMR stock at least as of the time that VMR filed its suit against Mitchell in 2009. However, our precedent is not clear on whether a debtor has a continuing duty to amend his bankruptcy schedules when the estate’s assets change in value. Given our reluctance to invoke judicial estoppel, and keeping in mind that judicial estoppel is an affirmative defense that its proponent must prove, we conclude that in this case Mitchell has not met its burden of showing any clearly inconsistent statements that would warrant that relief." View "Vehicle Market Research v. Mitchell International" on Justia Law

Defendants–Appellants Abercrombie & Fitch Co., Abercrombie & Fitch Stores, Inc., and J.M. Hollister LLC, d/b/a Hollister Co. (collectively, Abercrombie) appealed several district court orders holding that Hollister clothing stores violated the Americans with Disabilities Act (ADA). Plaintiff–Appellee Colorado Cross-Disability Coalition (CCDC) is a disability advocacy organization in Colorado. In 2009, CCDC notified Abercrombie that Hollister stores at two malls in Colorado violated the ADA. Initial attempts to settle the matter were unsuccessful, and this litigation followed. Abercrombie took it upon itself to correct some barriers plaintiff complained of: it modified Hollister stores by lowering sales counters, rearranging merchandise to ensure an unimpeded path of travel for customers in wheelchairs, adding additional buttons to open the adjacent side doors, and ensuring that the side doors were not blocked or locked. However, one thing remained unchanged: a stepped, porch-like structure served as the center entrance at many Hollister stores which gave the stores the look and feel of a Southern California surf shack. The Tenth Circuit affirmed in part and reversed in part the district court's judgment: affirming the court's denial of Abercrombie's summary judgment motion and certification of a class. However, the Court reversed the district court's partial grant, and later full grant of summary judgment to plaintiffs, and vacated the court's permanent injunction: "each of the district court’s grounds for awarding the Plaintiffs summary judgment [were] unsupportable. It was error to impose liability on the design of Hollister stores based on 'overarching aims' of the ADA. It was also error to impose liability based on the holding that the porch as a 'space' must be accessible. Finally, it was error to hold that the porch must be accessible because it is the entrance used by a 'majority of people.'" View "CO Cross-Disability Coalition, et al v. Abercrombie & Fitch, et al" on Justia Law

The plaintiffs in this case were David and Barbara Green, their three children, and the businesses they collectively owned and operated: Hobby Lobby Stores, Inc. and Mardel, Inc. As owners and operators of both Hobby Lobby and Mardel, the Greens organized their businesses with express religious principles in mind. As was particularly relevant to this case, one aspect of the Greens’ religious principles was a belief that human life begins when sperm fertilizes an egg. In addition, the Greens believed it was immoral for them to facilitate any act that caused the death of a human embryo. Plaintiffs brought an action to challenge portions of the Patient Protection and Affordable Care Act (ACA) whereby employment-based group health plans covered by the Employee Retirement Income Security Act (ERISA) were required provide certain types of health services for women that implicated contraceptive methods, sterilization procedures, and patient education and counseling (without cost-sharing by plan participants or beneficiaries) - all "abortifacients" that went against plaintiffs' religious beliefs. Plaintiffs filed suit to challenge the contraceptive-coverage requirement of the ACA under the Religious Freedom Restoration Act (RFRA), the Free Exercise Clause of the First Amendment, and the Administrative Procedure Act. Plaintiffs simultaneously moved for a preliminary injunction on the basis of their RFRA and Free Exercise claims. The district court denied that motion. Plaintiffs appealed the denial of the injunction. After review by the Tenth Circuit Court of Appeals, the Court held that Hobby Lobby and Mardel were entitled to bring claims under RFRA, established a likelihood of success that their rights under statute were substantially burdened by the contraceptive-coverage requirement, and established an irreparable harm. However, the case was remanded back to the district court for further proceedings on two remaining factors governing the grant or denial of a preliminary injunction. View "Hobby Lobby Stores, et al v. Sebelius, et al" on Justia Law

J. Hoyt Stephenson incorporated National Financial Systems Management, Inc. (NFSM) in Utah. The same day, the NFSM Employee Stock Ownership Plan was created. The Plan has always owned 100% of NFSM’s stock. Stephenson was one of the Plan’s trustees. In June 2006, Stephenson, along with his wife and children, moved from Utah to Wyoming, and as a result, Stephenson became a Wyoming citizen. About a year later, Stephenson sold one of his companies, National Financial Systems, Inc. (NFS) to NFSM. Then he sold another one, Metronomics Inc. to NFSM. In June 2009, Stephenson and his family went back to Utah. The issue before the Tenth Circuit in this case centered on whether Stephenson became a Utah citizen when he moved back. Brent Middleton, the Stock Plan's trustee, and several others (all Utah citizens), brought several federal-law claims Stephenson in the federal district court. Stephenson fought back with state-law counterclaims and a third-party complaint asserting state-law claims against multiple third-party defendants. The district court dismissed those counterclaims and third-party claims, concluding that it lacked diversity jurisdiction to hear them because Stephenson also was from Utah. The Tenth Circuit concluded that the district court did not clearly err in finding that Stephenson was a Utah citizen. View "Middleton, et al v. Stephenson, et al" on Justia Law

In June 2012, the United States District Court for the District of Utah dismissed the claims of J. Hoyt Stephenson (a man the district found to be a Utah citizen), for lack of diversity jurisdiction. Less than three months later, Stephenson assigned his interests in various stock and real property to a new company of his creation, National Fitness Holdings, Inc., a Wyoming corporation of which Stephenson was the sole director, officer and shareholder. Four days later, National Fitness sued Grand View Corporate Centre, LLC in federal district court. The district court once again dismissed for lack of subject-matter jurisdiction, this time finding that Stephenson had impermissibly made the assignments to manufacture diversity jurisdiction. Upon review of the appeal of that decision, the Tenth Circuit concluded the district court did not err in finding it lacked jurisdiction. Accordingly, the Court affirmed the district court's decision. View "National Fitness Holdings v. Grandview Corporate Center, et al" on Justia Law

Judy Knight appealed the dismissal of her lawsuit against Mooring Capital Fund. “Most of [the Tenth Circuit’s] reasons for affirmance are routine.” But the Court took the opportunity of this case to comment on Knight’s federal Racketeer Influenced and Corrupt Organizations Act (RICO) claims based on alleged misconduct in a prior litigation. With regard to her RICO claim, Knight argued that defendants made misrepresentations to the district court through pleadings and testimony that increased the cost of litigating her prior case, and caused the district court to rule against her. She alleged that that activity violated wire-fraud and mail-fraud statutes, thereby constituting a pattern of racketeering in violation of RICO. Because Knight did not identify any arguments she would have made regarding few and costs had it not been for defendants’ fraud, because she did not offer any specific explanation if how defendants’ litigation misconduct affected her ability to litigate he issues in the prior litigation, and because Knight did not allege there was evidence of misconduct that was unavailable while that prior litigation was pending, the Tenth Circuit affirmed the district court’s dismissal on this RICO claim too. View "Knight, et al v. Mooring Capital Fund LLC, et al" on Justia Law