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Commercial Law Case Summaries

[02/16] Roy Allan Slurry Seal, Inc. v. American Asphalt South, Inc.
In a government contracts dispute alleging the tort of intentional interference with prospective economic advantage, the Court of Appeals judgment overturning the trial court's judgment sustaining defendants demurrer, is reversed where plaintiffs' allegations -- that they had submitted the second lowest bids on several contracts awarded to defendant, and that their bids would have been accepted but for defendant's wrongful conduct during the bidding process -- are insufficient because: 1) public works contracts are a unique species of commercial dealings; 2) in the contracts at issue here, the public entities retained broad discretion to reject all bids; 3) the bids were sealed, and there were no postsubmission negotiations; 4) in awarding the contracts, the public entities could give no preference to any bidder based on past dealings, and were required to accept the lowest responsible bid; and 5) in these highly regulated circumstances, plaintiffs had 'at most a hope for an economic relationship and a desire for future benefit.' Blank v. Kirwan (1985) 39 Cal.3d 311, 331.

[12/22] Integrated Dynamic Solutions, Inc. v. VitaVet Labs, Inc.
In a contracts action, arising from a dispute between plaintiff computer software consultant and defendant VitaVet over an agreement to build custom software for defendant's e-commerce needs, the trial court's grant of a preliminary injunction ordering plaintiff to deliver the source code and technical specifications to defendant is affirmed where the facts establish this as an 'extreme case' where a preliminary injunction altering the status quo is available under City of Corona v. AMG Outdoor Advertising, Inc., 244 Cal.App.4th 291 (2016).

[12/21] Marilley v. Bonham
In an action brought by a class of nonresident commercial fishers challenging California?s nonresident fee differential for commercial fishing licenses, vessel registration and permits, the district court?s ruling of summary judgment in favor of the plaintiffs is reversed and remanded where the fee differentials survives a Privileges and Immunities Clause challenge because the differentials are justified by a substantial reason that is closely related to the fees.

[12/20] Stonehill Capital Management v. Bank of the West
In a contracts action arising from a dispute over the auction sale of a syndicated loan, the Appellate Division's grant of defendant's motion for summary judgment is reversed where the lack of a written sales agreement and plaintiffs' failure to submit a timely cash deposit were not conditions precedent to the formation of the parties' contract and do not render their agreement unenforceable.

[12/06] US v. Hosford
District court's dismissal of defendant's motion to dismiss an indictment for unlicensed dealing in firearms and conspiracy to deal firearms without a license, in violation of 18 U.S.C. section 922, is affirmed where: 1) the prohibition against unlicensed firearm dealing comports with the Second and Fifth Amendments both facially and as applied; and 2) it is also a valid exercise of congressional power under the Commerce Clause.

[11/21] Medical Marijuana, Inc. v. ProjectCBD.com
In a commercial law action, arising out of a dispute between competing producers and intertwined online media outlets connected to the cannabidiol industry, the trial court's denial of defendant's anti-SLAPP motion with respect to plaintiff's libel and false light claims is affirmed where defendants cannot meet their burden of identifying any protected activity that forms the basis of the claims against them.

[11/14] Christian Faith Fellowsihp Church v. Adidas AG
In a petition filed by Adidas, the Trademark Trial and Appeal Board's final judgment cancelling a Church's trademarks for failing to use the marks in commerce before registering them, on the grounds of the Church's de minimus sale of two marked hats to an out-of-state reside, is reversed where: 1) the Lanham Act defines commerce as all activity regulable by Congress; and 2) the Church's sale to an out-of-state resident fell within Congress?s power to regulate under the Commerce Clause.

[10/24] D'Egidio v. City of Santa Clarita
In an action concerning the regulation of billboards adjacent to highways under the Outdoor Advertising Act and related local ordinances, the trial court's grant of summary judgment to defendant city is affirmed where: 1) Business and Professions Code section 5270 does not preempt local regulations that are more restrictive than the act; and 2) plaintiff's billboard was illegal under defendant city's municipal regulations.

[10/21] Medina & Medina, Inc. v. Hormel Foods Corp.
In a case involving a dispute over an unwritten and allegedly exclusive distributorship agreement between plaintiff and Hormel Foods Corp. under Puerto Rico's Dealer's Contracts Act (Law 75), P.R. Laws Ann. tit. 10 sections 278-278e, the district court's judgment is: 1) affirmed in part where plaintiff's exclusivity claim as presented is time-barred; and 2) reversed in part where the statute of limitations bar to recovery extends to plaintiff's Costco-related claim as well.

[10/20] Gonzales v. CarMax Auto Superstores, LLC
In a suit alleging violations of California Vehicle Code section 11713.18(a)(6), which requires a car dealer to provide consumers with a 'completed inspection report' prior to the sale of any 'certified' used vehicle, the district court's summary judgment in favor of defendant is reversed and remand with instructions to enter summary judgment for plaintiff on his Consumer Legal Remedies Act and Unfair Competition Law claims where a report that fails to indicate the results of an inspection in a manner that conveys the condition of individual car components to a buyer is not a 'completed inspection report' under California law.

[10/05] Moran v. Prime Healthcare
In a suit challenging the variable pricing practice that a person receiving medical treatment at a hospital's emergency room who pays for it out of pocket can be charged versus one who is covered by a either a government-sponsored program or private insurance, under the Unfair Competition Law (UCL), Bus. & Prof. Code section 17200, the Consumer Legal Remedies Act (CLRA), Civ. Code section 1750 et seq., or for declaratory relief, Code Civ. Proc. section 1060, the trial court's judgment of dismissal is reversed where although most of the claims asserted by plaintiff lack merit, he has sufficiently alleged facts supporting a conclusion he has standing to claim the amount of the charges defendants' hospital bills self-pay patients is unconscionable.

[09/28] Coe v. City of San Diego
In a petition for writ of administrative mandate challenging a decision by the City of San Diego to revoke petitioner's nude entertainment business permit, the trial court's denial of the petition is affirmed over petitioner's arguments that certain sections of the San Diego Municipal Code applicable to nude entertainment businesses are unconstitutionally vague, that the City's decision to revoke her permit relied on inadmissable hearsay, and that the penalty of revocation violated her due process rights because it was arbitrary and capricious.

[08/24] Wal-Mart Puerto Rico v. Zaragoza-Gomez
In a tax law action, challenging Puerto Rico's corporate alternative minimum tax (AMT) directed at plaintiff Wal-Mart, the district court's enjoinment of the tax provision's enforcement is affirmed where: 1) federal district court possesses jurisdiction because plaintiff lacked a plain, speedy, and efficient remedy in Puerto Rico courts at the time of suit; and 2) the AMT is a facially discriminatory statute that does not meet the heightened level of scrutiny required to survive plaintiff's dormant Commerce Clause challenge.

[08/24] Otter Products, LLC v. US
In an international trade action, arising after the government classified plaintiff's protective cases for smartphones as 'similar containers' under subheading 4202.99.00 of the Harmonized Tariff Schedule of the United States (HTSUS), subject to a 20% ad valorem tariff rate, the Court of International Trade's grant of summary judgment to plaintiff is affirmed where the merchandise at issue was properly found not to be a container and thus properly classified as 'other articles of plastics' under HTSUS subheading 3926.90.99, subject to a 5.3% duty rate.

[08/23] American Hotel and Lodging Ass'n v. City of Los Angeles
In a labor and employment action, challenging defendant's Citywide Hotel Worker Minimum Wage Ordinance, the district court's denial of plaintiffs' motion for preliminary injunctive relief is affirmed where plaintiffs are unlikely to succeed in arguing that the city ordinance is preempted by federal labor law under the Machinists preemption doctrine

[08/23] NAACP v. City of Philadelphia
In a constitutional action making a facial challenge to Philadelphia International Airport's ban on non-commercial advertising, the district court's grant of summary judgment to plaintiff NAACP and striking of the ban is affirmed where: 1) the government bears the burden of proving the constitutionality of a restriction on speech in the limited public or nonpublic forum at issue here; and 2) defendant has not met its burden of proving the constitutionality of the ban because the record does not show that it maximizes revenue and avoids controversy at the airport.

[08/22] In re Del Biaggio III
In a bankruptcy action, arising from a dispute between owners of the National Hockey League's Nashville Predators, and involving a general unsecured claim for damages against debtor's estate, the bankruptcy court's grant of summary judgment to the estate is affirmed where the subordination of claims arising from the purchase or sale of the security of a debtor to other senior and equal claims under 11 U.S.C., section 510(b) applies where the debtor is an individual.

[07/21] City of San Jose v. MediMarts, Inc.
In a City's action to collect unpaid business taxes from marijuana business defendants, the trial court's denial of defendant's preliminary injunction against the City is affirmed over defendants' contention that payment of the Marijuana Business Tax, San Jose Municipal Code, section 4.66.010 et seq., would force defendant to incriminate himself in violation of his Fifth Amendment privilege by admitting criminal liability for violating federal drug laws, where the privilege against self-incrimination has no application in these circumstances.

[07/11] The Medicines Co. v. Hospira, Inc.
In a case arising from the submission of two Abbreviated New Drug Applications (ANDAs) for generic bivalirudin drug products before the expiration of the patents-in-suit, involving the circumstances under which a product produced pursuant to the claims of a product-by-process patent is 'on sale' under 35 U.S.C. section 102(b), the District Court's judgment that the transactions at issue did not render the asserted claims of a patent invalid under section 102(b) is affirmed where: 1) to be 'on sale' under section 102(b), a product must be the subject of a commercial sale or offer for sale, and that a commercial sale is one that bears the general hallmarks of a sale pursuant to section 2-106 of the Uniform Commercial Code; and 2) no such invalidating commercial sale occurred in this case.

[06/27] MPC Franchise, LLC v. Tarntino
In a trademark action concerning the mark for Pudgie's pizza chain restaurants, the district court's grant of summary judgment to plaintiffs is affirmed where there is no genuine issue of material fact that defendant Tarntino obtained his federal trademark registration of PUDGIE'S by fraud.

[06/20] Draper v. Healey
In a pre-enforcement action brought by firearms dealers, consumers and advocacy groups under 42 U.S.C. section 1983 challenging the constitutionality of a Massachusetts handgun regulation as being unenforceably vague in violation of Fourteenth Amendment due process, and a complementary claim that the regulation violates the Second Amendment by preventing them from purchasing third and fourth generations Glocks, the District Court's grant of the Government's motion to dismiss under Federal Rules of Civil Procedure 12(b)(1) and (6), is affirmed where: 1) the advocacy group lacks standing to sue; 2) the regulation is not vague; and 3) the consumer-plaintiffs' stipulation concedes that dismissal of the due process claim requires dismissal of the Second Amendment claim as well.

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