Justia U.S. 11th Circuit Court of Appeals Opinion Summaries

Payroll Management, Inc. filed for chapter 11 bankruptcy and received $1,070,330.23 from British Petroleum, Inc. for economic losses due to the Deepwater Horizon Oil Spill. Sunz Insurance Company claimed a first-priority security interest in these funds, asserting that its security interest attached and perfected before any other creditor. The Internal Revenue Service (IRS) contended that its federal tax lien had first priority as it attached and perfected first. Both parties filed cross motions for summary judgment.The bankruptcy court granted summary judgment in favor of the IRS, determining that Payroll’s BP claim was a commercial tort claim when the IRS filed its tax lien notice. The court found that the IRS’s tax lien attached and perfected first, while Sunz’s security interest did not attach to commercial tort claims. The district court affirmed this decision.The United States Court of Appeals for the Eleventh Circuit reviewed the case and affirmed the lower courts' decisions. The court held that Payroll’s BP claim remained a commercial tort claim in March 2017 when the IRS filed its tax lien notice. The settlement agreement did not automatically convert the tort claim into a contract, as it did not create an automatic obligation for BP to pay Payroll a certain amount. Therefore, the IRS’s tax lien, which attached and perfected first, took priority over Sunz’s security interest. The court concluded that the IRS was entitled to the $1,070,330.23 payment. View "Sunz Insurance Company v. Treasury Department" on Justia Law

VFS Leasing Co. ("VFS") leased trucks to Time Definite Leasing, LLC ("TDL"), which insured the trucks with Markel American Insurance Company ("Markel American"). Markel American issued joint checks to VFS and TDL for insurance claims, but TDL cashed the checks without VFS's endorsement and kept the proceeds. VFS sued Markel American for breach of contract, claiming it was owed the funds from the joint checks.The United States District Court for the Middle District of Florida granted summary judgment in favor of VFS, holding that Markel American breached the insurance contract by failing to ensure VFS received the funds. The court found that under Florida's Uniform Commercial Code (UCC), Markel American's obligation was not discharged because the checks were not properly endorsed by both co-payees.On appeal, the United States Court of Appeals for the Eleventh Circuit reviewed whether Markel American's obligation to VFS was discharged when the drawee bank improperly accepted the joint checks. The court concluded that under Florida Statute § 673.4141(3), a drawer's obligation is discharged when a bank accepts a jointly issued check, regardless of whether both co-payees endorsed it. The court noted that while VFS could pursue a conversion claim against the bank, Markel American's obligation was discharged upon the bank's acceptance of the checks.The Eleventh Circuit reversed the district court's summary judgment in favor of VFS and remanded the case for further proceedings consistent with its opinion. View "VFS Leasing Co. v. Markel Insurance Company" on Justia Law

Taxinet Corporation sued Santiago Leon, alleging various claims stemming from a joint effort to secure a government concession for a taxi-hailing app in Mexico City. The district court granted summary judgment for Leon on all claims except for a Florida-law unjust enrichment claim, which went to trial along with Leon’s counterclaims for fraudulent and negligent misrepresentation. The jury awarded Taxinet $300 million for unjust enrichment and Leon $15,000 for negligent misrepresentation. However, the district court granted Leon’s Rule 50(b) motion for judgment as a matter of law, ruling that the damages award was based on inadmissible hearsay and was speculative.The United States District Court for the Southern District of Florida initially allowed testimony regarding a $2.4 billion valuation by Goldman Sachs, which was later deemed inadmissible hearsay. The court concluded that without this evidence, there was insufficient support for the jury’s $300 million award. The court also noted that the valuation was speculative and not directly tied to the benefit conferred by Taxinet in 2015.The United States Court of Appeals for the Eleventh Circuit affirmed the district court’s Rule 50(b) order, agreeing that the valuation evidence was inadmissible hearsay and that the remaining evidence was insufficient to support the $300 million award. However, the appellate court exercised its discretion to remand for a new trial on the unjust enrichment claim. The court found that Taxinet had presented enough evidence to show that it conferred a benefit on Leon, which he accepted, and that it would be inequitable for him to retain the benefit without payment. The court also noted that Taxinet could potentially present other evidence of damages in a new trial.The appellate court affirmed the district court’s summary judgment on Taxinet’s other claims, ruling that the alleged joint venture agreement was subject to Florida’s statute of frauds, as it could not be completed within a year. Thus, any claims based on the existence of the joint venture agreement were barred. View "Taxinet Corp. v. Leon" on Justia Law

Plaintiff's suit concerning purchase of an aircraft claimed specific performance; and, in the alternative, breach of contract; breach of the covenants of good faith and fair dealing; and breach of the Florida Deceptive and Unfair Trade Practices Act (FDUTPA), Fla. Stat. 501.2105. The district court rejected the claims; proceeded under the Arizona Consumer Fraud Act, as requested by plaintiff; ruled in favor of defendant, but refused to award attorney fees under FDUPTA. After concluding that FDUTPA and its fee award provision are applicable as substantive law of the forum state, the Eleventh Circuit certified questions to the Florida Supreme Court: Whether an offer of judgment may be viable when it purports to settle "all claims," even though it does not explicitly state whether the proposal includes attorneys' fees and whether fees are part of the legal claim; Whether the fee provision applies to a lawsuit seeking damages or, in the alternative, specific performance; Whether the fee-shifting provision applies to an action with the case's unique procedural history; and Whether the provision applies only to fees incurred during the seven months before the FDUTPA claim was defeated at summary judgment, or also to fees incurred during subsequent litigation.