Justia U.S. D.C. Circuit Court of Appeals Opinion Summaries

Articles Posted in Contracts
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When Selden signed up for Airbnb, an online home rental platform, he was presented with a sign-in webpage that informs the user he is agreeing to certain terms by signing up. Airbnb’s Terms of Service required that all disputes be resolved by arbitration. After Selden signed up for Airbnb, he attempted to rent a listed room and suspected that the host denied his request because of his race, which the host could see from Selden’s profile picture. Selden created two fake Airbnb accounts with profile pictures of white individuals and used his fake accounts to request renting the same property for the same dates. According to Selden, the host accepted both requests. Selden posted his claims on social media where they went viral.Selden sued, citing Title II of the Civil Rights Act of 1964, 42 U.S.C. 2000a), the Civil Rights Act of 1866, 42 U.S.C. 1981, and the Fair Housing Act, 42 U.S.C. 3604. The district court compelled arbitration of his claims. The arbitrator ruled in favor of Airbnb. The court refused to vacate the arbitration award. The D.C. Circuit affirmed, rejecting Selden’s arguments that he did not agree to arbitrate because Airbnb’s sign-up screen failed to put him on notice of the arbitration clause in its Terms of Service, that his discrimination claims were not arbitrable, and that the arbitrator committed misconduct by failing to provide for sufficient discovery and by refusing to consider his expert report. View "Selden v. Airbnb, Inc." on Justia Law

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After appellant filed a breach of contract claim against the Government in D.C. Superior Court, the Government removed to district court and subsequently dismissed the claim. Appellant appealed, arguing that under 28 U.S.C. 1447(c), which provides that "[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded, " the district court should have remanded his claim.The DC Circuit affirmed the district court's judgment, concluding that 28 U.S.C. 1442(a)(1) and the Tucker Act make clear that section 1447(c) does not require the district court to remand in this case. The court explained that to require the district court to remand appellant's claim here, where the government has waived sovereign immunity against appellant's claim only in the Court of Federal Claims, and where that court has already dismissed appellant's claim, would be to subject the government to lengthy and piecemeal litigation of the kind that Congress intended section 1442(a)(1) to allow it to avoid. Therefore, the court concluded that, in context, Congress did not intend the "shall be remanded" language in section 1447(c) to mean that the district court must force the Government to spend one more ounce of resources on the re-litigation of a case it has already won. Accordingly, the court affirmed the judgment of the district court. View "Hammer v. United States" on Justia Law

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Plaintiff, who holds the RIOT ACT trademark, entered into a business agreement with defendants to open the Riot Act Comedy Club in downtown D.C. Plaintiff subsequently filed suit to recover damages from defendants' alleged breaches of fiduciary duty and of the operating agreement of the limited liability company the parties formed to start the club. Defendants counterclaimed.The DC Circuit reversed the district court's dismissal of plaintiff's breach of fiduciary duty claim, holding that plaintiff adequately alleged that he and defendants were members of a member-managed LLC and that under D.C. law that suffices to plead the existence of a fiduciary duty. In this case, the district court improperly found it "clear" that a "special confidential relationship transcending an ordinary business transaction did not take place" between the parties. The court explained that the district court failed to consider relevant District of Columbia and Maryland law, the statute's clear imposition of duties of loyalty and care typical of a fiduciary, or the nature of the parties' relationship—as partners and co-managers in a business venture, not merely arms-length parties to a standard commercial transaction. However, plaintiff failed to show that the court should reverse any of the district court's evidentiary rulings. The court affirmed the district court's decision to deny defendants judgment as a matter of law on plaintiff's breach of contract claim and to deny defendants' fee petition. The court remanded for further proceedings. View "Xereas v. Heiss" on Justia Law

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The DC Circuit reversed the district court's grant of summary judgment for the government in an action brought by the government seeking to collect a settlement against defendant. The court first rejected defendant's claim that the settlement contract is unenforceable because the parties omitted essential terms.In regard to defendant's claim that the district court should have granted him summary judgment because the government brought its suit too late, the court concluded that there is a material and disputed question of fact regarding performance that the district court should resolve after a bench trial. In this case, the government had six years to sue for breach of contract; the government filed suit in April 2016; and, if defendant breached the contract before April 2010, then the government's suit was untimely. Accordingly, the court remanded for further proceedings. View "United States v. Greer" on Justia Law

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ACC, the subcontractor on a Corps flood protection project, filed suit against the prime contractor, Hirani, for breach of contract and the providers of Hirani's payment bond, Colonial, under the Miller Act for unpaid labor and materials. The district court entered judgment in favor of ACC and awarded damages against both defendants.The DC Circuit remanded the case to the district court to make findings of fact as to when the Prime Contract was terminated and whether ACC performed labor or supplied material on April 29 and/or April 30. In the event that Colonial and Hirani cannot meet their burden to show that ACC's Miller Act claim was untimely, then this court can resolve the parties' other Miller Act contentions. If Hirani and Colonial show that termination occurred before April 29 or that ACC performed no labor or supplied no material on April 29 or 30, the court can then address the Miller Act statute of limitations issue. The court affirmed the restitution damages award against Hirani on ACC's contract claim where ACC has not provided the court with any basis to deviate from the principle of D.C. law that restitution, not quantum meruit, is the proper remedy where there is an express contract between the parties. The court deferred addressing other issues raised by the parties. View "United States v. Hirani Engineering & Land Surveying, PC" on Justia Law

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After DSCI filed suit against the Kingdom of Saudi Arabia, the Kingdom removed the case to federal district court and filed a motion to dismiss the complaint on the grounds of forum non conveniens, pointing to the forum-selection clause in the parties' contract. In this case, the contract provided that the Board of Grievances, a Saudi Arabian administrative court, shall be the assigned settlement of any disputes arising out of the contract. The DC Circuit affirmed the district court's grant of the Kingdom's motion, holding that the contract's forum-selection clause is mandatory and the dispute thus belonged before the Board of Grievances. View "D&S Consulting, Inc. v. Kingdom of Saudi Arabia" on Justia Law

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At the motion-to-dismiss stage, dismissal on statute-of-limitations grounds is permissible only if a plaintiff's claims are conclusively time-barred on the face of the complaint. The DC Circuit reversed the district court's determination that Capitol Services' lawsuit was barred by the statute of limitations because Capitol Services was on "inquiry notice" of defendant's alleged interference with its contract long before the limitations period expired.The record was inconclusive as to whether Capitol Services had knowledge of Vesta's role prior to August 28, 2014, three years before this suit against Vesta was filed. Therefore, when during that intervening period Capitol Services had inquiry notice of Vesta's potential role was an open factual question that could not be resolved at this time in the proceedings. Finally, Vesta's collateral estoppel claim failed because critical elements of collateral estoppel have not been established. View "Capitol Services Management v. Vesta Corp." on Justia Law

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MEBA filed suit against Liberty, alleging that its contract with Liberty required the parties to submit the underlying dispute to arbitration. The district court ruled in favor of MEBA and granted judgment on the pleadings, compelling arbitration.The DC Circuit affirmed and held that the district court had jurisdiction over MEBA's claim under section 301 of the Labor Management Relations Act of 1947 (LMRA), which provides federal jurisdiction over suits for violation of contracts between an employer and a labor organization. In this case, MEBA's claims regarding the arbitrability of the dispute clearly fell within the district court's statutory jurisdiction. The court rejected Liberty's argument under the Garmon preemption doctrine, and held that federal courts retain jurisdiction over hybrid claims raising both contractual and representational issues. Finally, although jurisdiction was proper here, the court reversed and remanded because material facts remained in dispute regarding the existence of an applicable arbitration clause. View "District No. 1 v. Liberty Maritime Corp." on Justia Law

Posted in: Contracts
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Commonwealth filed suit against two land surveyors, KCI and WMC, alleging breach of contract and negligence claims in connection with four allegedly defective surveys that the two entities delivered to ICG, a non-party to this litigation. Commonwealth alleged that KCI's and WMC's surveys failed to notice the full size of a twelve-inch encroachment, which ICG discovered on its property. The district court dismissed the complaint based on the three year statute of limitations.The DC Circuit reversed as to the first three counts of the complaint because the district court erred in dismissing them on statute of limitations grounds without applying the discovery rule. In this case, at the motion to dismiss stage, the court could not conclusively say that Commonwealth and ICG failed to exercise reasonable diligence in attempting to discover the encroachment's full size. Furthermore, it was premature to reject the possibility that Commonwealth's claims in counts one, two, and three did not accrue, at the earliest, until ICG discovered that the encroachment was twelve inches. View "Commonwealth Land Title Insurance Co. v. KCI Technologies, Inc." on Justia Law

Posted in: Contracts
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The DC Circuit vacated its previous opinion and substituted the following opinion.Homeowners filed suit against their insurance company for breach of contract when the company refused to cover flood damage to homeowners' residence. Homeowners also filed suit against their cleaning-and-restoration company for failing to adequately remedy the damage and prevent mold. The district court granted summary judgment for the insurance company and transferred the remaining claim to the district court based on lack of personal jurisdiction. The DC Circuit held that it lacked jurisdiction to review the transfer order. The court affirmed the grant of summary judgment, holding that homeowners' claim against the insurance company failed under Delaware law where there was no dispute that homeowners were away from their beach home for over 72 hours, which under the clear terms of the policy means the flooding occurred while the house was "unoccupied." View "Katopothis v. Windsor-Mount Joy Mutual Insurance Co." on Justia Law