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

Remark produced a distinctive series of television commercials for radio stations known as the “remarkable mouth” or “hot lips” commercials. The U.S. Copyright Office issued a copyright for a version of this commercial in 1980. The original holder of the copyright assigned it to Remark, which registered it with the Copyright Office in 2002. WADL, a Detroit television station, broadcast two commercials that resemble the copyright. After the commercials aired, Remark sent a cease-and-desist letter to the producer, Adell. After some negotiation, the parties agreed that $50,000 would settle Remark’s claims. Remark drafted an agreement, and Adell produced a revised version. Remark’s counsel e-mailed Adell’s counsel saying that Remark agreed to the changes. Adell forwarded a final version. Remark signed and returned the originals, but Adell never signed the agreement. It instead retained new counsel and for the first time balked at the $50,000 figure, offering to settle for a more “reasonable” amount. Remark filed suit. The district court granted Remark summary judgment but denied its request for attorney’s fees. The Sixth Circuit affirmed. View "Remark, LLC v. Adell Broad. Corp." on Justia Law

A collective bargaining agreement governs the relationship between Acument and its retired employees. Prior to 2008, the company paid healthcare and life-insurance benefits to qualified retirees. When Acument ended these benefits in 2008, a class of 64 retirees claimed that the company had violated the CBA in violation of the Employee Retirement Income Security Act and the Labor Management Relations Act. The district court granted Acument summary judgment. The Sixth Circuit affirmed, characterizing the issue as “a matter of contract.” The relevant language states that the company “reserves the right to amend, modify, suspend, or terminate the Plan,” consisting of: retiree medical coverage; retirement income; disability income; and life insurance. View "Witmer v. Acument Global Tech., Inc." on Justia Law

When AFC filed for bankruptcy in 2009, the FDIC was appointed receiver for AFC’s subsidiary, AmTrust and sought payment from AFC under 11 U.S.C. 365(o), which requires that a party seeking Chapter-11 bankruptcy fulfill “any commitment . . . to maintain the capital of an insured depository institution.” The FDIC argued that AFC made such a commitment by agreeing to entry of a cease-and-desist order requiring AFC’s board to “ensure that [the Bank] complies” with the Bank’s own obligation to “have and maintain” capital ratios of 7 percent (Tier 1) and 12 percent (total). The district court found that the order was not a capital-maintenance commitment under section 365(o). The Sixth Circuit affirmed. The cease-and-desist order is ambiguous and could reasonably be read as establishing either an oversight role or a capital-maintenance commitment and the bulk of the extrinsic evidence favored the “oversight” reading. View "Fed. Deposit Ins. Corp. v. Amtrust Fin. Corp." on Justia Law

GTI went bankrupt after it purchased OAI, a subsidiary of Onkyo for $13 million in cash and $12 million in three-year promissory notes. Onkyo filed a proof of claim for $12 million. GTI responded by suing Onkyo under the theory that the OAI purchase was a fraudulent, voidable transaction. The bankruptcy court agreed, finding that OAI was worth $6.9 million at the time of the transaction, not $25 million. The court voided GTI’s obligation to pay the remainder of the purchase price and ordered Onkyo to repay GTI $6.1 million. The district court and Sixth Circuit affirmed. The bankruptcy court’s determination that the indirect benefits were insubstantial was valid without the necessity of providing calculations; its adoption of GTI’s expert’s value based on the comparable transactions method was not clearly erroneous. Once the bankruptcy court determined that the sale of OAI had been a fraudulent transfer and Onkyo was a good-faith transferee, awarding GTI relief was a simple matter of subtraction. View "Onkyo Europe Elec., GMBH v. Global Technovations Inc." on Justia Law

In a 2009 opinion, the Sixth Circuit held that, in a 1998 collective bargaining agreement, CNH agreed to provide health-care benefits to retirees and their spouses for life, but rejected the suggestion that the scope of this commitment in the context of healthcare benefits, as opposed to pension benefits, meant that CNH could make no changes to the healthcare benefits provided to retirees. The court remanded for a determination of reasonableness with respect to CNH’s proposed changes to its retiree healthcare benefits, under which retirees, previously able to choose any doctor without suffering a financial penalty, would be put into a managed-care plan. The court listed three considerations: Does the modified plan provide benefits “reasonably commensurate” with the old plan? Are the proposed changes “reasonable in light of changes in health care”? And are the benefits “roughly consistent with the kinds of benefits provided to current employees”? On remand, the district court granted CNH summary judgment without reaching the reasonableness question or creating a factual record from which the determination could be made on appeal. The Sixth Circuit again remanded.View "Reese v. CNH America LLC" on Justia Law

Innotext represents automotive manufacturers. Stafford is its vice president. Petra is a sales, service, and support company that represents three offshore companies. In the 1990s, automakers outsourced work overseas to reduce labor costs. Stafford began looking for offshore companies that had the ability to manufacture automotive textile products. Stafford later testified that, based on a handshake agreement, he sought to generate business for Petra. After three sales to Johnson Controls, Innotext claimed that its efforts created an opportunity for Petra and sought commissions. The district court granted judgment as a matter of law on all counts. The Sixth Circuit reversed in part, finding that there was sufficient evidence that reasonable minds could differ, but affirmed dismissal of an implied contract claim. View "Innotext Inc. v. Petra'Lex USA Inc." on Justia Law

GenCorp owned a vinyl-manufacturing facility, including hazardous waste management units (RCRA units), which reclaimed solvent waste. Under the Resource Conservation and Recovery Act (RCRA), 42 U.S.C. 6901, GenCorp was obligated to obtain permits for the units. GenCorp had not received all of the required permits when it agreed to sell the facility. The agreement specified GenCorp’s retained liabilities, and contained a provision requiring each party to indemnify and defend against their retained liabilities. Textileather became the owner in 1990 and decided to discontinue use of the RCRA units. Textileather began the closure process required by Ohio Administrative Code 3745-66; the Ohio Environmental Protection Agency (OEPA) issued several Notices of Deficiency. Textileather challenged the OEPA’s 2001 closure plan and asserted that GenCorp was obligated to indemnify and defend. The district court ruled in favor of GenCorp, holding that, under the agreement, OEPA did not constitute a “third party” and Textileather’s RCRA closure proceedings did not constitute a “claim or action.” The Sixth Circuit reversed in part and directed the district court to enter judgment for Textileather on the legal question of whether the retained liabilities section of the agreement applies. The court affirmed that GenCorp retained only CERCLA claims covered by certain sections. View "Textileather Corp. v. GenCorp Inc." on Justia Law

TMTA obtained a policy, known as the CrimeShield Policy to transfer the risk of employee theft from the TMTA to Hartford. Almost immediately after the parties signed the Policy a TMTA employee began diverting funds into his own accounts from the TMTA Insurance Agency, a limited liability corporation controlled by the TMTA and from which the TMTA receives a significant portion of its income. The Agency is not a named insured under the policy. Hartford took the position that the Agency, not the TMTA, suffered the loss. The Sixth Circuit affirmed the district court, holding that the Agency a party is not directly covered by the policy, and that the policy does not otherwise provide for the TMTA to recover funds that were diverted from the Agency.View "Tooling, Mfg.& Tech. Ass'n v. Hartford Fire Ins. Co." on Justia Law

Watkins, an African-American, worked for the school district, overseeing security systems. Fultz supervised Watkins and, relying on Watkins’s advice, Fultz awarded Vision a $182,000 annual contract for service of security cameras. Vision’s president, Newsome, testified that Watkins called her and talked about a “finder’s fee.. Newsome went to Cleveland for a customer visit. She e-mailed Watkins and he replied: “Absolutely$.” Newsome believed that Watkins expected her to pay him at their meeting. Newsome notified Fultz. At the meeting, Watkins requested “an envelope.” After Fultz contacted police, the FBI recorded meetings at which Newsome gave Watkins $5,000 and $2,000. A white jury convicted on two counts of attempted extortion “under color of official right” (Hobbs Act, 18 U.S.C. 1951), and one count of bribery in a federally funded program, 18 U.S.C. 666(a)(1)(B). The court determined a total offense level of 22, applying a two-level enhancement for obstruction of justice, another two-level enhancement for bribes exceeding $5,000, and a four-level enhancement for high level of authority, plus an upward variance of 21 months under 18 U.S.C. 3553(a), and sentenced Watkins to six years’ incarceration. The Sixth Circuit affirmed, rejecting challenges to jury instructions, sufficiency of the evidence, the jury’s racial composition, and the reasonableness of the sentence.View "United States v. Watkins" on Justia Law

Plaintiffs are wholesalers of beer and wine; each acted as the exclusive distributor of Miller and/or Coors brands within a defined territory under written franchise agreements. In 2007, Miller and Coors entered a Joint Venture agreement, contemplating creation of MillerCoors, restructured their respective businesses and assets, and assigned distribution agreements to the Joint Venture. MillerCoors notified the plaintiffs that it intended to terminate their distribution rights as a successor manufacturer under Ohio Rev. Code 1333.85(D). The district court found that MillerCoors is not a “successor manufacturer” under Ohio law because it is controlled by Miller and Coors, and that the Act, therefore, prohibits MillerCoors from terminating the distributorships. The Sixth Circuit affirmed. Miller and Coors exercise control over MillerCoors through their equal voting power, veto power, the appointment of directors, all of whom are present officers or employees of the joint venture partners, and who owe their fiduciary duty only to Miller or Coors, their influence over the executive team, and their funding of MillerCoors. Even under the manufacturers’ proposed definition of “control,” the evidence shows that Miller and Coors together retain the power to “direct, superintend, restrict, govern, [and] oversee” MillerCoors. View "Beverage Distrib., Inc. v. Miller Brewing Co." on Justia Law