Justia Oklahoma Supreme Court Opinion Summaries

Articles Posted in Business Law
by
This legal battle began in 2006 when American Biomedical Group, Inc. (ABGI) and ABG Cattletraq, LLC (Cattletraq) filed a petition in the district court against Techtrol, Inc. and William Ardrey (Defendants); Defendants then filed a counterclaim. ABGI and Cattletraq dismissed their claims and causes of action against Defendants (without prejudice), leaving Defendants' counterclaim pending. Two years later, Defendants filed a petition in the same court against ABGI, Cattletraq, and James Burgess, their sole shareholder and CEO (Plaintiffs). In 2009, Plaintiffs filed another petition alleging that Defendants "wrongfully exercised dominion and control over plaintiffs' personal and intellectual property" and "willfully, deliberately and maliciously converted plaintiffs' personal and intellectual property" for their own benefit. Plaintiffs sought damages based on Defendants' unjust enrichment from the conversion. The district court consolidated the three cases. When the cases were consolidated, Defendants' counterclaim, Defendants' petition alleging abuse of process, and Plaintiffs' petition alleging causes of action for conversion and unjust enrichment remained pending before the district court. In 2014, Defendants moved for summary judgment on Plaintiffs' claim for conversion, asserting that Oklahoma did not recognize a tort for conversion of intangible property, and for unjust enrichment, asserting Plaintiffs' claim was precluded because they had an adequate remedy at law for breach of contract. The question this appeal presented for the Supreme Court's review was whether Defendants supported their motion for summary judgment with undisputed, material facts sufficient to warrant the district court granting partial summary adjudication in their favor. After that review, the Court answered in the negative. "Defendants failed to show that they were entitled to summary judgment. Throughout their arguments before the district court and this Court, Defendants rely on allegations which they have failed to allege as undisputed in their motion for summary judgment, which have no supporting evidentiary materials, and which Plaintiffs contest or which Plaintiffs have not admitted." View "American Biomedical Group, Inc. v. Techtrol, Inc." on Justia Law

Posted in: Business Law, Contracts
by
At issue before the Oklahoma Supreme Court in this case was a challenge to the legal sufficiency of Initiative Petition No. 409. Respondents-proponents Retail Liquor Association of Oklahoma and Bryan Kerr filed Initiative Petition No. 409 with the Oklahoma Secretary of State, seeking to amend the Oklahoma Constitution by repealing Article 28 and adopting Article 28A. Article 28A as proposed, would have allowed wine to be sold in grocery stores. Also under the proposed article, retail package stores could sell any and all items that were sold in convenience stores and grocery stores. Small brewers could sell their products at a brewery or festival or trade show and could sell alcoholic beverages by the drink at a restaurant co-located on the premises of the brewery. Petitioners-opponents Oklahoma Grocers Association and Ron Edgmon filed an Application to Assume Original Jurisdiction with the Supreme Court to protest: (1) the constitutionality of the petition; and (2) the statutory sufficiency of the gist of the petition. Upon review, the Supreme Court held that the gist of the petition did not fairly describe the proposed constitutional amendment and was invalid. View "In re Initiative Petition No. 409, State Question No. 785" on Justia Law

by
Joseph Parker was allegedly injured on the job. It was undisputed that Global Health Initiative (GHI), which at one time employed Parker, did not have workers' compensation insurance. Parker filed a workers' compensation claim in the Workers' Compensation Court. That court awarded Parker, by default judgment against GHI, $17,595.60 plus interest. Parker filed the judgment in the district court of Tulsa County in an attempt to collect the money awarded by the Workers' Compensation Court. After futile efforts to garnish the GHI bank accounts, Parker filed a motion to pierce the corporate veil and to proceed against individual GHI shareholders in an attempt to collect his compensation awards. The trial judge denied Parker's request due to lack of evidence. Thereafter, GHI filed notice of bankruptcy. By August of 2004, Parker had filed an appeal in which the Court of Civil Appeals reversed the trial court's determination that stockholders could not be held liable for the workers' compensation award and remanded the case to the trial court. GHI did not defend or participate in the case on appeal. Parker did not pursue collection against individual shareholders but, instead, returned to the Workers' Compensation Court seeking permanent partial and permanent total awards and an increase in his original award. GHI was not served notice of this proceeding and the cause was consequently undefended. The Workers' Compensation Court entered another award in favor of Parker and against GHI totaling $236,476.20. In June of 2009, Parker, through his counsel, sent letters to some of the GHI shareholders, seeking collection of the shareholders' pro rata share for payment of workers' compensation awards. However, for unexplained reasons, not all shareholders were asked to pay "their portion" of the judgment. The plaintiffs-appellants, doctors Thomas Kenkel and Robert Gold were two of the doctor stockholders, and they appealed seeking a declaration that: (1) Parker had no valid judgment against them; (2) Parker was not entitled to proceed against them for the injuries he sustained; (3) Parker was not entitled to collect the workers' compensation judgment; (4) they had the right to defend against any of Parker's claims ab initio; (5) they were not shareholders of GHI at all but if they were, they were merely minority shareholders; and (6) they were not liable for the debts Parker is attempting to collect. The trial court agreed and sustained the doctors' motion for summary judgment. Parker appealed and the Court of Civil Appeals reversed the trial court and remanded with directions for the trial court to enter judgment in the appellant's favor. The Oklahoma Supreme Court granted certiorari to address the issue of whether a business' failure to secure workers' compensation insurance rendered its shareholders personally liable for a workers' compensation award to an employee. The Court held that it did not. View "Kenkel v. Parker" on Justia Law

by
Plaintiff Stockbridge Energy, LLC brought suit against Jim Taylor, John Groninger, Jr., and Taylor Drilling Corp. in 2003, alleging, among other things, a breach of the parties' partnership and agreement for oil and gas lease development in Osage County. Specifically, Stockbridge alleged the defendants failed to account for the profits and losses of the partnership, failed to transfer property according to the parties' agreement, engaged in "secret transactions," and misappropriated profits due the partnership. The individuals, Jim Taylor and John Groninger, Jr., specially appeared and moved to dismiss for failure to state a claim on the grounds that the petition showed no individual liability on their part and that the theory of "piercing the corporate veil" was not viable under the facts as pled. Stockbridge did not respond to the motion of the individual defendants and, on August 17, 2004, an order was filed wherein the trial court granted the unopposed motions to dismiss. There was no discussion regarding any amendment of the petition nor did the trial court's order of dismissal set forth a time to allow any amendments. More than four years after the order granting the motions to dismiss, Stockbridge filed a motion seeking to amend its petition to add Taylor and Groninger back in as individual defendants. Over the objections of the defendants, the trial court granted leave to amend by no later than May 20, 2009. Stockbridge filed an amended petition re-naming Taylor and Groninger, and also added a new defendant, David Bomberger. Taylor and Groninger appealed the Court of Civil Appeals' judgment which agreed with the trial court in adding them back into the litigation after they had been dismissed years ago. The individual defendants argued to the Supreme Court that the time to amend the pleadings in this case, if any, should not have extended beyond the applicable statute of limitations or the one year savings clause to which a dismissed claim is otherwise subject. The Supreme Court agreed and reversed the appellate court's order. View "Stockbridge Energy, LLC v. Taylor" on Justia Law

by
The main issue on appeal in this case was whether the purchase of electricity and natural gas utility services qualifies for a sales tax exemption. Appellant-taxpayer American Airlines, Inc., ("AA") was denied a refund for the sales tax it paid on its purchases of electricity and natural gas utility services during the 2006 calendar year. The Account Maintenance and Compliance Division of the Oklahoma Tax Commission denied the request. Appellant timely protested the denial. The Oklahoma Tax Commission, by order, adopted the Findings, Conclusions and Recommendations of the administrative law judge finding taxpayer failed to prove the denial was incorrect. Upon review, the Supreme Court held the Services Exemption (68 O.S. Supp. 2006, section 1357 (28)) provided an exemption for electricity and natural gas utility services used by AA during 2006 in aircraft repair and maintenance activities. The remaining issue concerned the appropriate methodology for determining the amount of the sales tax refund AA should have received on its 2006 purchases of utility services. The adopted Findings, Conclusions and Recommendations did not make a specific finding concerning an appropriate methodology. The Court remanded the case back to the Oklahoma Tax Commission for further proceedings. View "American Airlines, Inc. v. Oklahoma Tax Commission" on Justia Law

by
Respondent-claimant, Ben Snell was employed by petitioner-employer Kentucky Fried Chicken of McAlester. He alleged that while at work he slipped and fell while carrying a tray of chicken weighing approximately 40 to 50 pounds. The trial court awarded claimant temporary total disability (TTD) and reasonable and necessary medical treatment for injuries to his neck, the second finger of his right hand, and aggravation of pre-existing conditions to his left knee and low back. All other issues were reserved. On appeal, the Court of Civil Appeals (COCA) sustained the award. In its opinion, COCA ruled the standard of review in this case was the "any competent evidence" standard because of a holding in a previous opinion by the same division, "Westoak Industries, Inc. v. DeLeon," which held 85 O.S. 2011 sec. 340(D)(4), setting out "against the clear weight of the evidence" as the appellate standard of review in workers' compensation cases, constituted a violation of the separation of powers provision of the Oklahoma Constitution. Westoak was completely at odds with another COCA opinion, "Harvey v. Auto Plus of Woodward." "Harvey" held section 340(D)(4) was not unconstitutional as a separation of powers violation. The Supreme Court granted certiorari to consider the issue as one of first impression since certiorari was not sought in either of the previous cases. The Court concluded that there was no constitutional separation of powers prohibition in in the Okla.Const., art IV, section 1 against the Legislature's adoption of the "against the clear weight of the evidence" standard of review in 85 O.S. 2011 sec. 340(D)(4). COCA's opinion was therefore vacated. Because "Westoak" and "Harvey" were totally inconsistent with the views expressed in this opinion, they were both specifically overruled. View "Kentucky Fried Chicken of McAlester v. Snell" on Justia Law

by
Appellant CDR Systems Corporation entered into a stock purchase agreement to sell all of its assets. In August 2009, CDR filed its 2008 Oklahoma Small Business Corporation Income Tax Return and claimed the Oklahoma Capital Gains Deduction for gains received from the sale. The Oklahoma Tax Commission denied the deduction claimed by CDR because CDR was not headquartered in Oklahoma for three years prior to the sale as required by state law. The Court of Civil Appeals reversed and found the deduction violated the dormant commerce clause. Upon review, the Supreme Court found there was no discrimination against interstate commerce to which the dormant commerce clause applied. Furthermore, the Court held that even if the dormant commerce clause applied in this case, the deduction did not facially discriminate against interstate commerce, it did not have a discriminatory purpose, and the deduction had no discriminatory effect on interstate commerce. View "CDR Systems Corp. v. Oklahoma Tax Comm'n" on Justia Law

by
Plaintiff-Appellant Mastercraft Floor Covering, filed a lawsuit against Charlotte Flooring (CFI), a North Carolina corporation, in Oklahoma. Mastercraft alleged that CFI had hired it to install carpet in a North Carolina casino, but that after the work was completed, CFI failed to pay for the labor, services, and materials. CFI entered a special entry of appearance to object to Oklahoma having jurisdiction to decide the cause because CFI lacked the requisite minimum contacts to be sued in the State of Oklahoma. The trial judge, determined that Mastercraft failed to prove that CFI had sufficient minimum contacts to permit Oklahoma to exercise jurisdiction over CFI without offending conventional notions of fair play and substantial justice. Mastercraft appealed, and the Court of Civil Appeals affirmed. Upon review, the Supreme Court concluded that because of the totality of contacts with the Oklahoma-based corporation, the trial court had personal jurisdiction. View "Mastercraft Floor Covering, Inc. v. Charlotte Flooring, Inc." on Justia Law

by
The issue on appeal to the Supreme Court centered on whether Lincoln Farm, L. L. C. breached a contract to sell potatoes to Farming Technology Corporation, and whether certain provisions of the Uniform Commercial Code involving the unavailability of a carrier and a commercially impracticable method of delivery were applicable to the parties. Farming Technology argued at trial that Lincoln Farm was required to build a private rail spur in order to fulfill Lincoln Farm's contractual obligation to load potatoes on railcars or trucks furnished by Farming Technology Corporation to take delivery of the potatoes. After review of the contract in question, the Supreme Court held that the contract unambiguously stated that Farming Technology Corporation would furnish railcars or trucks to take delivery of the potatoes, and that the contract did not state that Farming Technology had the right to insist on delivery solely by rail, or to insist that Lincoln Farm build a private rail spur. View "Lincoln Farm, LLC v. Oppliger" on Justia Law

by
Charles Sheffer, Jennifer Sheffer, and their minor son, J.S., were injured when their tractor trailer collided with a rental vehicle leased to William Garris and driven by David Billups, employees of Carolina Forge Company, L.L.C. Plaintiffs sued Carolina Forge on theories of respondeat superior and negligent entrustment. They also sued the Buffalo Run Casino, the Peoria Tribe of Indians of Oklahoma, and PTE, Inc. for dram-shop liability. The trial court granted summary judgment in favor of Carolina Forge, finding as a matter of law Carolina Forge was not liable for its employees' actions under a theory of respondeat superior and did not negligently entrust the rental vehicle to its employees. The trial court also dismissed, sua sponte, the Buffalo Run Casino, PTE, Inc., and the Peoria Tribe of Indians of Oklahoma, determining that injunctions issued by the Western District of Oklahoma prohibited suit for any tort claims against a tribe or a tribal entity. Plaintiffs appealed both orders. Upon review, the Supreme Court concluded the Peoria Tribe was immune from suit in state court for compact-based tort claims because Oklahoma state courts are not courts of competent jurisdiction as the term is used in the model gaming compact. Furthermore, the Court found that because Congress has not expressly abrogated tribal immunity from private, state court dram-shop claims and because the Peoria Tribe and its entities did not expressly waive their sovereign immunity by applying for and receiving a liquor license from the State, the tribe was immune from dram-shop liability in state court. View "Sheffer v. Buffalo Run Casino" on Justia Law