Justia U.S. 1st Circuit Court of Appeals Opinion Summaries

First State Insurance Company and New England Reinsurance Corporation (collectively, First State) entered into several reinsurance and retrocession agreements with a reinsurer, National Casualty Company (National). First State demanded arbitration under eight of these agreements to resolve disputes about billing disputes and the interpretation of certain contract provisions relating to payment of claims. The arbitrators handed down a contract interpretation award that established a payment protocol under the agreements. First State filed a petition pursuant to the Federal Arbitration Act to confirm the contract interpretation award, and National filed a cross-petition to vacate the award. A federal district court summarily confirmed both the contract interpretation award and the final arbitration award. After noting that “a federal court’s authority to defenestrate an arbitration award is extremely limited,” the First Circuit affirmed, holding that the arbitrators “even arguably” construed the underlying agreements and, thus, acted within the scope of their contractually delineated powers in confirming the contract interpretation award. View "First State Ins. Co. v. Nat’l Cas. Co." on Justia Law

Plaintiff obtained a $23 million judgment against a Corporation. Plaintiff sought to secure payment on that judgment by filing suit in federal district court against the Corporation’s president and its corporate parent, alleging that Defendants had looted the Corporation of more than $18 million in assets in order to render it judgment-proof. After Plaintiff learned that one of the Corporation’s corporate parents planned to merge with an Austrian subsidiary, the district court issued a temporary restraining order, later converted into a preliminary injunction, barring the merger. Defendants nevertheless effected the merger. The district court issued civil contempt sanctions on Defendants for violating the court’s preliminary injunction order. Plaintiff subsequently moved for default judgment based on Defendants’ assertion that they had no intention of complying with the contempt order. The district court entered judgment for Plaintiff and awarded $75 million to Plaintiff. The First Circuit affirmed, holding (1) the district court properly exercised personal jurisdiction over Defendants; (2) Plaintiff’s complaint adequately stated valid causes of action for, inter alia, tortious interference with contractual relations and veil piercing; (3) the district court did not abuse its discretion in entering default judgment as a sanction for Defendants’ discovery violations; and (4) the district court did not err when it entered a damage award without an evidentiary hearing. View "AngioDynamics, Inc. v. Biolitec AG" on Justia Law

In 2011, Catlin (Syndicate 2003) at Lloyd’s (“Catlin”) issued to San Juan Towing and Marine Services (SJT), a ship repair company based on San Jan, Puerto Rico, a marine insurance policy to cover SJT’s floating drydock. After the drydock was damaged and sold for scrap, the SJT filed a claim with Catlin, alleging the total loss of the drydock in the amount of $1,750,000. Catlin denied this claim. Catlin then filed a declaratory judgment complaint against SJT, alleging eight admiralty or maritime claims and seeking to void the policy. SJT filed a separate diversity suit against Catlin seeking recovery for the full insured value under the policy for the loss of the drydock. At trial, the district court concluded that the insurance policy was void ab initio pursuant to the doctrine of uberrimae fidei. The First Circuit affirmed as modified, holding (1) the contract was voidable, not void ab initio; and (2) SJT violated the doctrine of uberrimae fidei in its procurement of the policy, and thus, Catlin was entitled to void the policy. View "Catlin (Syndicate 2003) at Lloyd’s v. San Juan Towing & Marine Servs., Inc." on Justia Law

This case involved the dispute over settlement agreements between AstraZeneca, which sells a heartburn drug called Nexium, and three generic drug companies that sought to market generic forms of Nexium. The named plaintiffs sued AstraZeneca and the three drug companies, alleging that the settlement agreements constituted unlawful agreements not to compete. Plaintiffs sought class certification for a class of third-party payors and individual consumers. The district court certified a class. Defendants appealed. After briefing, oral argument, and submission of this case, however, Defendants filed a voluntary motion to dismiss the interlocutory appeal. The First Circuit denied the motion to dismiss, holding (1) although some of the underlying issues in this case had been settled and a jury had reached a verdict on some others, the case was not moot; (2) a final draft of the Court’s opinion had already been prepared; and (3) Defendants may have been acting strategically by seeking to dismiss the interlocutory appeal. View "In re Nexium Antitrust Litig." on Justia Law

AstraZeneca, which sells a heartburn drug called Nexium, and three generic drug companies (“generic defendants”) that sought to market generic forms of Nexium, entered into settlement agreements in which the generic defendants agreed not to challenge the validity of the Nexium patents and to delay the launch of their generic products. Certain union health and welfare funds that reimburse plan members for prescription drugs (the named plaintiffs) alleged that the settlement agreements constituted unlawful agreements between Nexium and the generic defendants not to compete. Plaintiffs sought class certification for a class of third-party payors, such as the named plaintiffs, and individual consumers. The district court certified a class. Relevant to this appeal, the class included individual consumers who would have continued to purchase branded Nexium for the same price after generic entry. The First Circuit affirmed the class certification, holding (1) class certification is permissible even if the class includes a de minimis number of uninjured parties; (2) the number of uninjured class members in this case was not significant enough to justify denial of certification; and (3) only injured class members will recover. View "In re Nexium Antitrust Litig." on Justia Law

After T G Plastics Trading Co., Inc. (“National Plastics”) allegedly fell behind on payments owed to Toray Plastics (America), Inc., Toray filed suit. The parties settled the lawsuit, and the terms of the settlement were memorialized in a Settlement Agreement. The Settlement Agreement provided that Toray would sell certain materials exclusively through National Plastics and pay National Plastics a twelve percent commission on all sales generated by National Plastics. When the parties began to dispute several aspects of the application of the Settlement Agreement, National Plastics sued Toray. The original complaint did not contain a jury demand. After two years of settlement negotiations, National Plastics amended its complaint to request a jury trial. A jury found Toray liable for breach of the Settlement Agreement and awarded National Plastics more than $2 million in damages. The First Circuit affirmed, holding (1) the district court did not err in allowing National Plastics to amend its complaint to add a jury demand, as National Plastics did not waive its right to a jury trial by a belated demand; and (2) the evidence was sufficient to support the jury’s finding of liability and its calculation of damages. View "T G Plastics Trading Co., Inc. v. Toray Plastics (America), Inc." on Justia Law

Rosana Claudio-de Leon (Claudio) and the University of the East of the Ana G. Mendez University System (SUAGM) entered into an employment contract that contained a forum selection clause precluding adjudication in federal court. Claudio, Luis F. Carrasquillo-Rivera, and the conjugal partnership Carrasquillo-Claudio (collectively, Appellants) filed suit against SUAGM in the district court, alleging, among other claims, pregnancy and gender discrimination. The district court dismissed Appellants’ Title VII pregnancy and gender discrimination claim and supplemental state law claims due to the forum selection clause. The First Circuit affirmed as modified, holding (1) the forum selection clause was applicable and enforceable; but (2) the district court should have dismissed the case without prejudice to permit Appellants to refile in the appropriate forum. Remanded. View "Claudio de-Leon v. Ayala" on Justia Law

In 1997, Appellant began working for Banco Popular de Puerto Rico (BPPR). After Appellant retired in 2009, BPPR made a final calculation of Appellant’s pension, which yielded monthly payments significantly lower than earlier estimates had suggested. Seeking the higher amount he had expected, Appellant brought claims under ERISA, a theory of estoppel, and Puerto Rico contract law. The district court (1) dismissed the ERISA and contract claims, concluding that Appellant failed to state a claim under ERISA and that ERISA preempted the commonwealth claims; and (2) granted summary judgment against Appellant on the estoppel claim, concluding that the unambiguous terms of the benefits plan precluded a claim for estoppel. The First Circuit affirmed, holding (1) Appellant could not recover under ERISA because he could not be awarded relief under the terms of BPPR’s retirement plan; (2) the district court properly held that Appellant’s commonwealth claims “relate to” the ERISA-regulated plan and, accordingly, they were preempted; and (3) because Appellant did not show any ambiguity in the plan, his equitable estoppel claim necessarily failed. View "Guerra-Delgado v. Banco Popular de P.R." on Justia Law

Plaintiff and Defendant entered into an asset purchase agreement (the Agreement) that contained a provision requiring submission of all disputes concerning the “validity, interpretation and enforcement” of the Agreement to an arbitrator for binding resolution. Plaintiff sued Defendant in federal district court, asserting claims for fraud and breach of contract arising out of the Agreement. Defendant answered the complaint, and the parties began discovery. Several months later, Plaintiff moved to stay proceedings pending arbitration. A magistrate judge denied the motion to stay on the ground that Plaintiff had waived its arbitral rights. The district judge summarily affirmed the denial of the stay. The First Circuit affirmed, holding that the district court did not err in concluding that Plaintiff, through its conduct, waived its right to demand arbitration. View "Joca-Roca Real Estate, LLC v. Brennan, Jr." on Justia Law

With the threat of foreclosure looming on his home, Plaintiff sued Bank for failing to consider him for a mortgage loan modification, which a California class action settlement agreement required Bank to do before attempting to foreclose on Plaintiff’s home. The complaint alleged breach of contract, violation of Mass. Gen. Laws ch. 244, 35A and 35B, violation of Mass. Gen. Laws ch. 93A, and breach of the implied covenant of good faith and fair dealing. The district court dismissed the complaint in its entirety. The First Circuit vacated in part and remanded Plaintiff’s claims for breach of contract and breach of the implied covenant of good faith and fair dealing, holding (1) Plaintiff’s statutory causes of action fell short of stating a cognizable claim; but (2) the district court improperly converted Bank’s motion to dismiss Plaintiff’s contract-based claims into a motion for summary judgment, warranting a remand of those claims. View "Foley v. Wells Fargo Bank, N.A." on Justia Law