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

In 2006, plaintiffs contracted with defendant to purchase a condominium for $395,900. They made cash deposits of $11,877 and executed a note for $19,795. When notified of a closing date in 2009, plaintiffs' counsel sent defendant a letter rescinding the agreement and requesting return of the deposits. Defendant declined. Plaintiffs' complaint alleged violation of the Interstate Land Sales Full Disclosure Act, 15 U.S.C. 1701, for failing to provide a printed property report, and failure to include a provision notifying plaintiffs that if defendant failed to furnish a property report before execution of the purchase agreement, they had the right to revoke the purchase agreement within two years of its signing. They also asserted a claim under the Michigan Condominium Act, Mich. Comp. Laws 559.184. The district court held that the claim for rescission was untimely, stating that a purchaser must notify the seller of rescission within two years after the signing, but a has an additional third year to bring suit if the seller refused to honor the rescission. The Sixth Circuit affirmed that the claim for automatic rescission was untimely, but reversed dismissal of the state law claim and remanded. Equitable rescission may be available under 15 U.S.C. 1709.

Defendant, a Russian citizen, attended graduate school and owns real property, vehicles, and bank accounts in Ohio. He spends some time in Ohio each year, ranging from 40 days in 2007 to a total of 17 days in 2008–2009. He visits under a tourist visa and does not have an Ohio driver's license. After going to Russia to take part in a business venture with defendant, plaintiff filed suit in Ohio. The contract had no connection to the state. The trial court dismissed for lack of personal jurisdiction, noting that defendant was not served with process in a manner that automatically confers personal jurisdiction. The Sixth Circuit affirmed, finding that notions of fair play and substantial justice weigh against jurisdiction in Ohio. The court quoted a Russian proverb, “If you’re afraid of wolves, don’t go into the forest” that could be read, “If you’re afraid of the Russian legal system, don't do business in Russia.”

Plaintiff was hired as a nurse by defendant in October 2006, had to take leave for cancer treatment, then was informed that she had been terminated on December 12, 2006 because she did not have "any accrued PTO time or FMLA." The district court dismissed claims under the Americans with Disabilities Act, finding that plaintiff assented to a valid agreement to arbitrate the claims. The Sixth Circuit reversed. The employee handbook stated: "Dispute Resolution Process Please refer to the Eby Companies Dispute Resolution Procedure (DRP) for details." That policy does refer to arbitration and contains a signature line. Plaintiff claims she did not receive or sign the policy and defendant did not provide a signed acknowledgment. There was no indication that plaintiff was notified of the existence of the arbitration agreement, much less that she manifested an intent to agree to its terms.

Plaintiff a law school faculty member living in Ohio, contracted with defendant (Nevada corporation, doing business in California) for publication of his manuscript, giving a Virginia address. Based on delays in publication, plaintiff sued for breach of contract, interference with contract and prospective advantage, defamation, intentional or reckless infliction of emotional distress, negligent infliction of emotional distress; misrepresentation, and fraud. After several motions, including default judgment and reinstatement, and discovery, defendant successfully moved to dismiss for lack of personal jurisdiction. The Sixth Circuit reversed and remanded. Defendant waived the personal jurisdiction defense and voluntarily submitted to the district court’s jurisdiction, when its attorney entered a general appearance on its behalf.

Plaintiff contracted to purchase 11 Burger King restaurants. A jury found that defendant had properly terminated the agreement but had breached the duty of good faith and fair dealing, and awarded $190,907.27. Over one year later, the district court entered a partial judgment denying specific performance and awarding $5,176.24 of the $424,282.19 in attorneys’ fees and expenses incurred in connection with the litigation. The Sixth Circuit reversed and remanded. The plaintiffs presented evidence that defendant hindered attempts to close the transaction, but defendant's actions in blocking due diligence and failing to provide financial information did not cause plaintiff damages because defendant properly terminated the agreement. The district court erred in calculating fees and expenses.

Plaintiff and defendant, investment trusts that specialize in healthcare-related properties, participated in a two-step auction to purchase the assets of a Canadian company. The defendant's efforts derailed. Plaintiff entered into an agreement to purchase the assets, but before the agreement was approved by shareholders, the defendant made a higher bid and made a public announcement. After a flurry of press releases and a ruling by a Canadian court concerning a confidentiality clause that was part of the bidding process, the defendant revoked its bid. The stockholders rejected the agreement with the plaintiff; the deal closed after plaintiff increased its bid. The district court awarded the plaintiff $101,672,807 for tortious interference with contract and with prospective advantage. The Sixth Circuit affirmed, but remanded for consideration of punitive damages. The declaratory proceedings in Canada did not preclude the claims at issue. Jury instructions concerning tortious interference involving competitors, motive, causation, and breach of the confidentiality agreement as wrongful conduct were appropriate.

In the first lawsuit, retirees, funded by the union, obtained a preliminary injunction preventing plaintiff from terminating their healthcare benefits. The case is still pending. In the second lawsuit, the plaintiff claims that the union's participation in the first lawsuit violated a collective bargaining agreement (CBA) and that the union, during negotiation of the CBA, committed breach of an implied warranty of authority, negligent misrepresentation, and intentional misrepresentation. The district court dismissed the second suit, holding that the union did not breach the CBA and that federal law preempted the state law claims. The Sixth Circuit affirmed that the union did not breach the CBA, which did not include a covenant not to sue, as claimed by the plaintiff. The court reversed with respect to preemption of the tort claims, which are "analytically distinct, but of a piece for purposes of" jurisdiction under 29 U.S.C. 185(a).