Justia U.S. 6th Circuit Court of Appeals Opinion Summaries

The case involves a dispute between Firexo Group Limited (FGL), a British company that manufactures fire extinguishers, and Firexo, Inc., a Florida-based company that was created to sell FGL's products in the United States. Scot Smith, a resident of Ohio, purchased 70% of Firexo, Inc. from FGL under a Joint Venture Agreement (JVA). The JVA included a forum-selection clause designating England or Wales as the exclusive jurisdiction for any disputes arising from the agreement. Firexo, Inc., which was not a signatory to the JVA, later sued FGL in an Ohio court over issues with the fire extinguishers. FGL sought to dismiss the case based on the forum-selection clause in the JVA.The district court granted FGL's motion to dismiss, applying the "closely related" doctrine. This doctrine allows a non-signatory to a contract to be bound by a forum-selection clause if the non-signatory is sufficiently closely related to the contract. The district court found that Firexo, Inc. was closely related to the JVA and therefore subject to the forum-selection clause. Firexo, Inc. appealed this decision, arguing that the district court applied the wrong law and analytical approach in determining the applicability of the contract.The United States Court of Appeals for the Sixth Circuit reversed the district court's decision. The appellate court agreed with Firexo, Inc. that the district court had applied the wrong law. The court held that the "closely related" doctrine, a federal common law rule, should not have been used to interpret the JVA's forum-selection clause. Instead, the court should have applied the law specified in the JVA, which was English law. Under English law, contracts do not apply to non-signatories unless certain exceptions apply, none of which were present in this case. Therefore, the forum-selection clause in the JVA did not apply to Firexo, Inc., and the case was remanded for further proceedings. View "Firexo, Inc. v. Firexo Group Limited" on Justia Law

The case revolves around the death of Darius Caraway, who overdosed while serving a murder sentence at Whiteville Correctional Facility in Tennessee, operated by CoreCivic, Inc. Caraway's estate, represented by his mother, sued CoreCivic and three of its officials, alleging that they violated Caraway's Eighth Amendment rights by failing to protect him from overdosing. The estate argued that CoreCivic deliberately understaffed the facility, leading to inadequate screening of prison guard applicants, smuggling of illegal drugs, and lack of supervision, which allowed fentanyl to proliferate at Whiteville. The estate claimed that the defendants knew about this proliferation but did nothing about it, leading to Caraway's death by overdose.The United States District Court for the Western District of Tennessee dismissed the estate’s complaint, stating that the claims were conclusory allegations of unconstitutional conduct devoid of well-pled factual support. The estate appealed this dismissal to the United States Court of Appeals for the Sixth Circuit.The Sixth Circuit affirmed the district court's decision. The court found that the estate failed to adequately allege that Caraway faced an objectively excessive risk of harm from unfettered access to drugs inside Whiteville. The court also found that the estate failed to sufficiently allege that the defendants knew of a drug problem at Whiteville or that they didn't reasonably respond to the alleged risk. The court concluded that the estate failed to meet the requirements of a failure-to-protect claim under the Eighth Amendment. The court also dismissed the estate's procedural claims, stating that the district court properly treated the motion as one to dismiss and that the estate had forfeited its argument about the district court's failure to issue a scheduling order. View "Caraway v. CoreCivic of Tennessee, LLC" on Justia Law

The case involves Century Aluminum Company and its subsidiaries (Century), and Certain Underwriters at Lloyd's, London (Lloyd's). Century uses river barges to transport alumina ore and other materials for its aluminum smelting operations. In 2017, the Army Corps of Engineers closed key locks on the Ohio River, causing Century to seek alternative transportation. Century filed a claim with Lloyd's, its maritime cargo insurance policy provider, for the unanticipated shipping expenses. While Lloyd's paid $1 million under the policy's Extra Expense Clause, it denied coverage for the rest of the claim.The case was first heard by the United States District Court for the Western District of Kentucky. Century sought a declaration that its denied claims were covered by the insurance policy and requested damages for Lloyd's alleged breach of contract among other violations of Kentucky insurance law. Lloyd's sought summary judgment, arguing that the policy did not cover the claims. The district court sided with Lloyd's.The appeal was heard before the United States Court of Appeals for the Sixth Circuit. Century argued that the policy's All Risks Clause, Risks Covered Clause, Shipping Expenses Clause, and Sue and Labour Clause required Lloyd's to cover the additional shipping expenses. The court rejected these arguments, affirming the district court's ruling. The court held that under the All Risks Clause and Risks Covered Clause, Century's alumina did not suffer any physical loss or damage. As for the Shipping Expenses Clause, it covered the risk of a failed delivery, not an untimely one. Lastly, under the Sue and Labour Clause, Century was required to mitigate Lloyd's exposure under the policy, but it did not obligate Lloyd's to pay anything for reducing losses that fall outside the policy. View "Century Aluminum Co. v. Certain Underwriters at Lloyd's, London" on Justia Law

FedEx Ground Package Systems, Inc. (FXG) filed a lawsuit against Route Consultant, Inc., alleging that the latter company had made nine false or misleading statements about FXG's business practices. FXG contended that these statements were intended to foster discontent between FXG and its contractors, thereby damaging FXG and benefiting Route Consultant. The suit was brought under both the Lanham Act's false advertising provision and the Tennessee Consumer Protection Act's statutory disparagement provision.The United States Court of Appeals for the Sixth Circuit confirmed the lower court's decision to dismiss the case. The court found that FXG had failed to plausibly allege that Route Consultant made a single false or misleading statement. The court emphasized that only statements of fact--not opinions, puffery, or rhetorical hyperbole--are actionable under the false advertising provision of the Lanham Act. Moreover, a plaintiff must plead and prove the literal falsity of the defendant's statement or demonstrate that the statement is misleading. FXG's complaint did not meet these standards.The court also held that FXG's claim under the Tennessee Consumer Protection Act failed for the same reasons as its Lanham Act claim. Thus, the court affirmed the district court's dismissal of FXG's lawsuit against Route Consultant. View "FedEx Ground Package Systems, Inc. v. Route Consultant, Inc." on Justia Law

The United States Court of Appeals for the Sixth Circuit ruled in a case involving Bannum Place of Saginaw, LLC and Bannum, Inc., affiliates offering reentry services for formerly incarcerated individuals. After Bannum Saginaw's employees voted to unionize, the company undertook actions that were perceived as anti-union, leading to unfair labor practice charges. Bannum Saginaw was found guilty of firing union supporters Greg Price and Ernie Ahmad. The National Labor Relations Board (NLRB) sought to enforce a supplemental decision and order directing the companies to pay specific backpay amounts to Price and Ahmad.The court held that Bannum, Inc. and Bannum Saginaw were a single employer and affirmed the Board's decision to jointly hold them responsible for the backpay. The court rejected the argument that this decision violated Bannum, Inc.'s due process rights, noting that when two entities constitute a single employer, notice to one is notice to all. The court also upheld the Board's backpay calculations, dismissing the companies' arguments that the employees had not sufficiently mitigated their damages. Consequently, the court granted the Board's application for enforcement and denied the companies' cross-petition. View "NLRB v. Bannum Place of Saginaw, LLC" on Justia Law

In the case between the National Labor Relations Board (NLRB) and Bannum Place of Saginaw, LLC and Bannum, Inc., the court ruled in favor of the NLRB.Bannum Place of Saginaw, a provider of reentry services for formerly incarcerated individuals, had been found to have engaged in unfair labor practices, including the termination of two union supporters. The NLRB sought enforcement of its decision to award specific backpay amounts to the two affected employees. Bannum contested this decision, arguing that Bannum, Inc. and Bannum Place of Saginaw were not a single employer and that the backpay calculation was erroneous.The court, however, upheld the NLRB's decision, noting that substantial evidence supported the finding that Bannum, Inc. and Bannum Place of Saginaw constituted a single employer. The court also rejected Bannum's argument that the backpay calculation was erroneous, stating that the burden was on the employer to establish facts that would mitigate that liability. The court also dismissed Bannum’s claims that its due process rights were violated, explaining that the relationship between Bannum, Inc. and Bannum Place of Saginaw was so interrelated that they actually constituted a single integrated enterprise.In conclusion, the court granted the NLRB's application for enforcement and denied Bannum's cross-petition. View "NLRB v. Bannum Inc." on Justia Law

Insight Terminal Solutions, LLC ("ITS") appealed against a decision by the Bankruptcy Appellate Panel of the Sixth Circuit. The dispute centered on a claim originally filed by Cecelia Financial Management, LLC ("Cecelia"), and later transferred to Bay Bridge Exports, LLC ("Bay Bridge"), in ITS's chapter 11 bankruptcy. ITS sought to disallow or reduce the claim, recharacterize the debt as an equity contribution, and hold John J. Siegel, Jr., the non-member manager of both ITS and Cecelia, liable for fraud. The Bankruptcy Court allowed the claim, rejecting ITS's arguments. On appeal, ITS argued that the Bankruptcy Court erred in refusing to admit incomplete deposition testimony from Siegel, who died before cross-examination could take place. ITS also contended that the court erred in applying the presumption of validity to the claim and in refusing to recharacterize the claim as equity. The Appellate Panel upheld the Bankruptcy Court's decision, finding no reversible error. It ruled that the Bankruptcy Court was within its discretion to exclude Siegel's incomplete testimony and found no error in the court's decision to allow the claim and refusal to recharacterize it as equity. View "In re Insight Terminal Solutions, LLC" on Justia Law

In this case heard by the United States Court of Appeals for the Sixth Circuit, the plaintiff, Marketing Displays International (MDI), sued the defendant, Brianna Shaw, for allegedly violating her one-year non-compete agreement when she left MDI and began working for another company. The district court granted a preliminary injunction, preventing Shaw from working for her new employer for one year. Shaw appealed this decision in January 2023. However, due to several deadline extensions requested by both parties, the briefing did not finish until January 2024. By that time, the one-year period of the injunction had already expired, rendering the appeal moot.Shaw argued that the appeal was not moot as a ruling would impact her ability to recover any damages, including reputational harm caused by the injunction, and MDI's ability to recover attorney fees. The court disagreed, stating that Shaw could not collect damages until a final judgment is in her favor, and MDI's right to attorney fees did not depend on the validity of the preliminary injunction.Shaw also requested the court to vacate the moot portion of the preliminary injunction. However, the court refused, stating that the injunction would not have any preclusive effect on future litigation and that Shaw contributed to the appeal's mootness by requesting deadline extensions.Therefore, the appeal was dismissed as moot, and the case was remanded back to the lower court for further proceedings. View "Marketing Displays International v. Shaw" on Justia Law

In this case, Autumn Wind Lending, LLC (Autumn Wind) had lent money to Insight Terminal Solutions, LLC (Insight) under an agreement that Insight would not incur any further debt without Autumn Wind's consent. However, Insight defaulted on the loan and filed for bankruptcy, during which it was revealed that it had taken on additional debt from other parties, including John J. Siegel and three family enterprises. Autumn Wind, which had become the parent company of Insight, then filed a lawsuit against these parties, alleging fraud and tortious interference. The United States Court of Appeals for the Sixth Circuit was asked to decide whether the doctrine of res judicata, which bars relitigation of a claim that has been adjudicated, prevented Autumn Wind from bringing these claims. The court held that the doctrine of res judicata did not bar Autumn Wind from bringing its claims. The court reasoned that the claims had not been "actually litigated" because they were dismissed by stipulation in the bankruptcy court, not decided on the merits. Furthermore, Autumn Wind could not have litigated these claims in the bankruptcy court because it was not a party to the bankruptcy proceedings. The court therefore reversed the district court's dismissal of Autumn Wind's claims and remanded the case for further proceedings. View "Autumn Wind Lending, LLC v. Siegel" on Justia Law

The United States Court of Appeals considered an indemnification case between Nissan, an automobile manufacturer, and Continental, a brake parts supplier. Nissan sought indemnification from Continental for a $24 million jury award and $6 million in attorney fees and costs resulting from a products liability lawsuit in California. The lawsuit arose after an accident involving a Nissan vehicle, with the jury finding that the design of the vehicle’s braking system caused harm to the plaintiffs. Nissan argued that a provision in their contract with Continental obligated Continental to indemnify them for the jury award and litigation costs. Both the district court and the Court of Appeals disagreed, holding that the contract required Nissan to show that a defect in a Continental-supplied part caused the injury, which Nissan failed to do. The Appeals Court affirmed the district court's decision to grant summary judgment in favor of Continental. View "Nissan North America, Inc. v. Continental Automotive Systems, Inc." on Justia Law