Thursday, August 19, 2021

Corporate fiduciary duty, business records, statute of limitations, and wild boar with mustard and thyme sauce and wild lingonberries

Appeals -- Absence of transcript -- Trial court erred in granting summary judgment in favor of insurer in case involving proper application of policy deductible -- Although there is no transcript of pre-trial conference where ruling was made, error is apparent on face of record where explanation of review documents submitted by insurer show that insurer applied the fee schedule authorized by 627.736(5)(a)1.f. to total charges before applying PIP deductible. NORTH BROWARD CHIROPRACTIC AND WELLNESS CENTER, INC. a/a/o CRISTINA CORRIDORI, Appellant, v. GOVERNMENT EMPLOYEES INSURANCE COMPANY, Appellee. 4th District.

Appeals -- Real property -- Appeal of nonfinal order scheduling sale of property ordered partitioned pursuant to final judgment -- Appeal is essentially an untimely challenge to judgment ordering partition of property where notice of appeal was filed more than 30 days after rendition of that final order -- Order of partition is final at such time as court directs sale of the property -- Appeal dismissed. LISONEL PEREZ, Appellant, v. PEDRO A. JAIMOT and MARILYN JAIMOT, Appellees. 3rd District.

Attorney's fees -- Trial court erred in awarding attorney's fees to defendant pursuant to prevailing party provision in contract where defendant failed to plead entitlement to contractual attorney's fees -- Exception to pleading requirement for seeking attorney's fee set forth in Stockman v. Downs is not applicable where plaintiff did not, through any action or inaction, waive any objection to defendant's failure to plead claim for contractual attorney's fees. TIMOTHY LENAHAN, Appellant, v. SHANNON LENAHAN, Appellee. 3rd District.

Civil procedure -- Relief from judgment -- Jurisdiction -- No error in vacating order setting aside mediated settlement agreement where suit had been voluntarily dismissed prior to entry of the order. GAYLE M. BURNS, Appellant, v. LAW OFFICES OF LYNWOOD ARNOLD, P.A., Appellee. 2nd District. 

Contracts -- Asset purchase agreements -- Assumption of debt -- Action alleging that defendant had assumed debt which was secured by equipment defendant purchased as part of APA -- Error to enter summary judgment in favor of plaintiff where plaintiff did not refute defendant's affirmative defense that plaintiff failed to state a cause of action against it -- Although plaintiff alleged that defendant assumed debtor's obligations under the note and repeatedly alleged that defendant breached “the note,” defendant had never been a party to the note -- Because any obligation that defendant may have to plaintiff is based solely on APA to which plaintiff was not a party, and which never mentioned the note, plaintiff has a cause of action against defendant only under third-party beneficiary theory -- Plaintiff's failure to allege requisite elements of a third-party beneficiary claim precluded entry of summary judgment in its favor -- Additionally, plaintiff did not refute affirmative defense of lack of consideration -- Reduction of APA purchase price by amount of debt did not constitute consideration, but simply ensured that defendant would not pay for the equipment twice. OTI FIBER, LLC, Appellant, v. CENTERSTATE BANK, N.A.; FLORIDA FIBER NETWORKS, LLC; DAVID ORSHAN; and DAVID S. SUAREZ, Appellees. 2nd District.

Dissolution of marriage -- Alimony -- Long-term marriage -- Trial court erred in denying former wife's request for alimony based on finding former husband had no ability to pay without also making a specific factual determination as to whether former wife had an actual need for alimony -- Moreover, when one party is entitled to permanent periodic alimony but other spouse has no current ability to pay, trial court should award a nominal sum which would give court jurisdiction to reconsider award should parties' financial circumstances change. IRENE SAMANIEGO, Appellant, v. LOUIS SAMANIEGO, Appellee. 2nd District.

Dissolution of marriage -- Attorney's fees -- Jurisdiction -- Timeliness of motion -- Trial court erred in denying wife's post-judgment motion for attorney's fees based on mistaken belief that rule 1.525 divested it of jurisdiction to entertain motion for fees filed more than 30 days after judgment -- Rule does not apply to family law cases -- Fee proceedings in family law cases are governed by section 61.16, and that statute does not impose 30-day limitation on trial court's post-judgment jurisdiction to consider fee motions. WELLY JUHL, n/k/a Welly Garza, Appellant, v. TED M. JUHL and TMJ OF PINELLAS COUNTY, INC., Appellees. 2nd District.

Employer-employee relations -- Veterans -- Retaliation -- Termination -- Employee who testified in judicial proceeding under a subpoena -- Sovereign immunity -- Action alleging wrongful termination in violation of section 92.57 and retaliation under the Uniformed Services Employment and Reemployment Rights Act -- Trial court erred in denying Fish and Wildlife Conservation Commission's motion to dismiss on sovereign immunity grounds -- Sovereign immunity bars private actions brought under USERRA against a state agency -- There is no clear and unequivocal waiver of sovereign immunity in section 92.57, and the waiver provisions of section 768.28 do not apply. FLORIDA FISH & WILDLIFE CONSERVATION COMMISSION, Appellant, v. JEFFREY HAHR, Appellee. 1st District.

Insurance -- Bad faith -- Third-party bad faith -- Contracts -- Cunningham agreements -- Limitation of actions -- Trial court erred in dismissing bad faith action based on conclusion that claim was barred by statute of limitations -- Parties' modified Cunningham agreement, which was intended to serve as the functional equivalent of the excess judgment needed to pursue third-party bad faith claim, did not constitute the functional equivalent of an excess judgment until the court approved it one year after both parties had signed it -- Trial court's conclusion that agreement did not require court approval was not supported by the plain language of the agreement, and was inconsistent with the parties' stated purpose for entering the agreement -- Because bad faith action was filed within four years from date trial court approved parties' agreement, the action was not barred by statute of limitations. WRIGHT INSURANCE AGENCY, INC. and ANTHONY WRIGHT, Appellants, v. NATIONWIDE MUTUAL FIRE INSURANCE COMPANY, Appellee. 2nd District.

Insurance -- Homeowners -- Directed verdict -- Error to enter directed verdict in insurer's favor on claim that insurer breached contract by not fully paying for a covered loss within 20 days of receiving insured's sworn proof of loss based on trial court's conclusion that insurer had 90 days to investigate claim -- Subsection in loss-payment provision of insurance policy which contained the 90-day limit commenced upon insurer's receipt of notice of an initial claim, not upon filing of sworn proof of loss -- Viewing facts in light most favorable to insured, insured's lawsuit was not premature where a jury could have found that insurer received notice of initial claim more than 90 days prior to the filing of insured's suit -- Even assuming suit was premature, proper procedure would have been to abate the action or dismiss without prejudice -- Trial court erred by granting insurer a directed verdict on count which alleged that insurer breached contract by not fully repairing home after it exercised its option to repair -- Based on testimony at trial, a jury could reasonably have found that insurer exercised its option to repair notwithstanding insurer's failure to give written notice as policy required. MARY IWANICKI, Appellant, v. SAFEPOINT INSURANCE COMPANY, Appellee. 2nd District.

Paternity -- Child custody -- Petition for determination of paternity, parental responsibility, parenting plan, time-sharing schedule, and child support by petitioner, who claims to be biological father of child born during wedlock, seeking to gain custody of child -- Trial court violated due process by entering involuntary dismissal without affording petitioner opportunity to present his full case-in-chief, including opportunity to present evidence to establish standing. ALPHA RANSOM, Appellant, v. KITREANA GRANT-VAN BROCKLIN, et al., Appellees. 3rd District.

Torts -- Corporations -- Breach of fiduciary duty -- Conversion -- Aiding and abetting -- Dismissal -- Derivative action brought by one of two shareholders in closely-held corporation alleging that the other shareholder, with assistance from his family, froze plaintiff out of corporation and transferred corporate assets to a new competing entity -- Order dismissing complaint with prejudice for failure to state a cause of action is reversed -- Discussion of the fiduciary duties of officers and directors of a corporation -- Complaint stated a cause of action for breach of fiduciary duty against defendant shareholder where it alleged that defendant shareholder owed a fiduciary duty as the sole operating officer; defendant shareholder breached that duty by mounting a takeover of the company, diverting corporate business relationships and revenues to a competitor, and executing documents to transfer corporate property to competitor; and that alleged breaches damaged corporation by causing its assets to be wasted and dissipated to a nominal value -- There is no authority for proposition that a complaint must plead a breach of fiduciary duty with heightened specificity to state a cause of action -- Even assuming the existence of such an elevated pleading requirement, it was satisfied in this case -- Claims against defendant shareholder's family members stated a cause of action for aiding and abetting defendant shareholder's breach of fiduciary duty -- Allegations against defendant family members were not commingled where, although defendants were sometimes collectively referred to as the “family,” complaint set forth separate counts against each defendant family member and alleged specific conduct against each individual defendant -- Complaint stated a cause of action for conversion as to some of corporation's assets, such as goodwill of the business -- Action for conversion may be based upon a wrongful takeover of intangible interests in a business venture -- No error in dismissing conversion claim as to cash, misappropriation of trade secrets, and business and contractual relationships -- Error to dismiss claim of aiding and abetting conversion based on conclusion that Florida does not recognize such a cause of action -- Because Florida recognizes aiding and abetting liability for common law torts, it follows that Florida recognizes a claim for aiding and abetting conversion. HARRY TAUBENFELD, as shareholder of PASSOVER FB., INC., Appellant, v. JONATHAN LASKO, SAMUEL LASKO, ARLENE LASKO, AVI LASKO, and LASKO GETAWAYS, LLC., Appellees. 4th District.

Torts -- Dismissal -- Denial of motion -- Appeals -- Certiorari -- Petition seeking review of order denying motion to dismiss complaint for pure bill of discovery and directing petitioner to file an answer is denied because petitioner failed to demonstrate irreparable harm. IMC MEDICAL CENTERS, LLC and JOSEPH YORK a/k/a JOSEPH ZUMWALT, Petitioners, v. JOHN DELUCA, Respondent. 4th District.

Torts -- Sanctions -- Joint and severable liability -- Final judgment imposing sanctions against two parties jointly and severally is reversed where there was no basis in record for doing so. WIDERMAN MALEK, P.L. AND CELEBRATION LAW, P.A., Appellants, v. C.H. AS SETTLOR OF THE J.F. SPECIAL NEEDS TRUST, THE CENTER FOR SPECIAL NEEDS TRUST ADMINISTRATION, INC., AS TRUSTEE OF THE J.F. SPECIAL NEEDS TRUST, Appellees. 5th District.


Segarra Miranda v. Banco Popular de Puerto Rico
Court: US Court of Appeals for the First Circuit
Docket: 20-9006
Opinion Date: August 6, 2021
Judge: Sandra Lea Lynch
Areas of Law: Bankruptcy, Real Estate & Property Law
The First Circuit affirmed the judgment of the Bankruptcy Appellate Panel for the First Circuit (BAP) affirming the summary judgment entered by the bankruptcy court against the bankruptcy trustee (the Trustee) for an estate of two individuals, holding that an unrecorded mortgage in Puerto Rico is not a transfer of the debtor's property that is voidable by a bona fide purchaser that triggers the bankruptcy trustee's authority to avoid and preserve the lien. Jose Antonio Lopez Cancel and Carmen Nereida Medina Gonzalez acquired a property in Puerto Rico that they used as their primary residence. Banco Popular de Puerto Rico held the mortgage, but the mortgage was never recorded. The bankruptcy court treated the mortgage as a general unsecured claim covered by an earlier discharge order. The Trustee then filed this action to avoid the mortgage and preserve it on behalf of the bankruptcy estate, arguing that the unrecorded mortgage was a transfer of the debtor's property that was voidable by a bona fide purchaser. The bankruptcy court concluded that the Trustee could not avoid and preserve an unrecorded mortgage because, under Puerto Rican law, an unrecorded mortgage is not a property interest. The BAP affirmed. The First Circuit affirmed, holding that there was no error.


Reid Hospital and Health Care, Inc. v. Conifer Revenue Cycle Solutions, LLC
Court: US Court of Appeals for the Seventh Circuit
Docket: 20-1735
Opinion Date: August 11, 2021
Areas of Law: Business Law, Contracts, Health Law
Healthcare revenue cycle management contractors manage billing and behind-the-scenes aspects of patient care, from pre-registering patients to reviewing and approving documentation upon release. Reid Hospital contracted with Dell, a revenue cycle management contractor. Their contract limited both sides’ damages in a breach of contract action in the absence of willful misconduct or gross negligence. Dell sold much of its portfolio to Conifer in 2012 while Dell was still losing money on the Reid contract. Conifer began reducing staff and neglecting duties; there was a slowdown throughout the revenue-management cycle and in processing patients’ discharge forms, leading to longer hospital stays that third-party payors refused to reimburse fully. After two years, Reid took its revenue operation back in-house. Reid's consultant found significant errors in Conifer’s work. Reid sued for breach of contract, claiming that Conifer’s actions caused the hospital to lose tens of millions of dollars. The court granted Conifer summary judgment, reading the contract as defining all claims for lost revenue as claims for “consequential damages,” prohibited absent “willful misconduct.” The Seventh Circuit reversed. Even if lost revenue is often considered consequential, this was a contract for revenue collection services and did not define all lost revenue as an indirect result of any breach. Lost revenue would have been the direct and expected result of Conifer’s failure to collect and process that revenue as required under the contract. The parties did not intend to insulate Conifer entirely from damages.


Life Spine, Inc. v. Aegis Spine, Inc.
Court: US Court of Appeals for the Seventh Circuit
Docket: 21-1649
Opinion Date: August 9, 2021
Judge: St. Eve
Areas of Law: Intellectual Property, Patents
Life Spine makes and sells a spinal implant device called the ProLift Expandable Spacer System. Aegis contracted with Life Spine to distribute the ProLift to hospitals and surgeons. Aegis promised to protect Life Spine’s confidential information, act as a fiduciary for Life Spine’s property, and refrain from reverse-engineering the ProLift. Aegis nonetheless funneled information about the ProLift to its parent company, L&K Biomed to help L&K develop a competing spinal implant device. Shortly after L&K’s competing product hit the market, Life Spine sued Aegis for trade secret misappropriation and breach of the distribution agreement. The district court granted Life Spine a preliminary injunction barring Aegis and its business partners from marketing the competing product. Aegis argues that the injunction rested on a flawed legal conclusion—that a company can have trade secret protection in a device that it publicly discloses through patents, displays, and sales. The Seventh Circuit affirmed. While public domain information cannot be a trade secret, a limited disclosure does not destroy all trade secret protection. Life Spine did not publicly disclose the specific information that it seeks to protect by patenting, displaying, and selling the ProLift. Life Spine’s trade secrets are not in the public domain but are accessible only to third parties who sign confidentiality agreements.


The Law Lady.  For more info about us, click here.  To be added to our email circulation with MUCH, MUCH more law, click here and specify whether you wish to be added to our CRIMINAL, CIVIL, or  FEDERAL Recent Decisions of Interest.