Justia West Virginia Supreme Court of Appeals Opinion Summaries

Articles Posted in Business Law
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The case in question arose from a multi-million-dollar loss suffered by Westlake Chemical Corporation and Axiall Corporation (the respondents) at their chlorine manufacturing plant in Natrium, West Virginia. The loss occurred when 90 tons of liquid chlorine leaked from a rupture in a railroad tanker car that had been recently repaired by third-party contractors. The liquid chlorine vaporized into a cloud or plume that caused corrosion damage to the equipment at the plant. The respondents claimed the damage costs from their insurance companies (the petitioners). However, the insurance companies denied coverage based on three exclusions in the insurance policies relating to corrosion, faulty workmanship, and contamination. The case reached the Supreme Court of Appeals of West Virginia, which was asked to review three orders of the Circuit Court of Marshall County, West Virginia, Business Court Division. The lower court had granted partial summary judgment to the respondents, finding that none of the three exclusions barred the respondents’ coverage claims. The Supreme Court of Appeals of West Virginia concluded that the lower court's orders were not final orders subject to appeal at this stage of the proceedings. This was due to unresolved issues of causation and damages, and because the orders did not conclusively determine the disputed controversy, resolve an important issue completely separate from the merits of the action, or were effectively unreviewable on appeal from a final judgment. Therefore, the court dismissed the appeal, without prejudice. View "NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA. v. WESTLAKE CHEMICAL CORPORATION" on Justia Law

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The Supreme Court granted a writ of prohibition sought by Thornhill Motor Care, Inc. to prevent the Circuit Court of Mingo County from enforcing its order denying Petitioner's motion to dismiss based on improper venue, holding that Thornhill established that it was entitled to the writ.Moore Chrysler, Inc. brought this action against Thornhill in Mingo County, alleging violations of W. Va. Code 17A-6A-1 to -18 and seeking declaratory and injunctive relief. Thornhill moved to dismiss the complaint pursuant to W. Va. R. Civ. P. 12(b)(3) on the basis of improper venue, asserting that the proper venue for this lawsuit was in Logan County pursuant to the general venue statute, W. Va. Code 56-1-1. The circuit court denied the motion, basing its ruling on a specific venue statute, W. Va. Code 17A-6A-12(3), which governs declaratory judgment actions brought by new motor vehicle dealers against manufacturers or distributors. Thornhill then sought the writ of prohibition at issue. The Supreme Court granted the writ, holding that the circuit court committed clear legal error in applying section 17A-6A-12(3) rather than section 56-1-1. View "Thornhill Motor Car, Inc. v. Honorable Miki Thompson" on Justia Law

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The Supreme Court reversed the business court's orders in this rent dispute, holding that the business court erred in granting summary judgment to either party.American Bituminous Power Partners, LP (AMBIT) and Horizon Ventures of West Virginia, Inc. created a contractual relationship with a lease agreement. The current rent dispute involved the relationship between the lease, a 1996 settlement agreement, and a 2017 order of the business court. Without resolving the relationship between those documents the business court granted summary judgment to AMBIT on Horizon's claims and summary judgment to Horizon on AMBIT's claims. The Supreme Court reversed, holding that summary judgment was improper because the various agreements were ambiguous and the parties' intent was not clear. View "Horizon Ventures of W. Va., Inc. v. American Bituminous Power Partners, L.P." on Justia Law

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The Supreme Court affirmed the judgment of the circuit court denying the motions filed by both sides for reasonable attorney fees and expenses after a settlement left each side convicted that the other side had behaved in bad faith, holding that the circuit court acted within its discretion in denying Michael Harlow's motion for attorney fees and expenses.Harlow was one of three members of Eastern Electric, LLC when Eastern lost almost $400,000 in a prevailing wage case. Thereafter, Harlow dissociated from Eastern. Eastern made an offer to purchase Harlow's interest, but Harlow rejected the offer. Harlow then sued to enforce his statutory right to receive fair value for his interest. The parties eventually settled. Both sides then sought to recover their attorney fees and expenses. The circuit court rejected both parties' motions, and Harlow appealed. The Supreme Court affirmed, holding that the circuit court did not abuse its discretion in refusing an award of fees. View "Harlow vs. Eastern Electric, LLC" on Justia Law

Posted in: Business Law
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The Supreme Court reversed the orders of the circuit court granting Respondents' motions to dismiss, holding that Petitioners' pleading stated a sufficient basis upon which relief could be granted and that Respondents failed to show beyond a reasonable doubt that Petitioners could prove no set of facts in support of their claims that would entitle them to relief.On appeal, Petitioners argued that in granting Respondents' motions to dismiss pursuant to Rule 12(b)(6) the circuit court failed to consider all the Petitioners' factual allegations. Further, Petitioners alleged that for the few allegations it did consider, the circuit court improperly imputed inferences favorable to Respondents. The Supreme Court reversed, holding (1) Respondents failed to establish beyond doubt that Petitioners' pleading did not state a claim upon which relief may be granted; and (2) Petitioners sufficiently alleged a claim for aiding and abetting tortious interference. View "Mountaineer Fire & Rescue Equipment, LLC v. City National Bank of West Virginia" on Justia Law

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The Supreme Court answered a question certified to it by a federal district court regarding W. Va. Code 31E-3-304(b)(2), holding that beyond the derivative suit mentioned in the statute, a member of a nonprofit corporation's board of directors may not file a derivative suit against another director to recover damages or other relief on behalf of the nonprofit corporation.Section 31E-3-304(b)(2) permits a member of a nonprofit corporation's board of directors to file an "ultra vires" derivative suit against another member of the board of directors to challenge the validity of an action taken by the corporation. At issue in this case was whether the Legislature intended to preclude such derivative suits brought by a member of the board of directors against another director to recover damages or other relief on behalf of nonprofit corporations. The Supreme Court answered in the negative, holding that, other than as expressly authorized by section 31E-3-304(b)(2), the West Virginia Nonprofit Corporation Act does not confer the right upon a director to bring a derivative action on behalf of the nonprofit corporation. View "John A. Sheppard Memorial Ecological Reservation, Inc. v. Fanning" on Justia Law

Posted in: Business Law
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The Supreme Court reversed the order of the circuit court certifying as final the prior orders that granted summary judgment to Respondents in this civil action arising out of the modification of covenants pertaining to a residential subdivision developed by RJM Holdings, LLC, holding that the genuine issues of material fact precluded summary judgment.On appeal, Petitioners argued that the circuit court erred by granting summary judgment because genuine issues of material fact existed regarding whether Respondents were engaged in a joint venture with RJM to develop the subdivision and whether the corporate veils of the respondent businesses should be pierced to hold certain individuals personally liable. The Supreme Court agreed and reversed, holding that genuine issues of material fact existed with respect to the conduct of Respondents and the use of the various business entities to develop the subdivision. View "Dailey v. RJM Holdings, LLC" on Justia Law

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In this long-running contractual dispute between Petitioners, the West Virginia Investment Management Board (IMB) and the West Virginia Consolidated Public Retirement Board (CPRB) and Respondent, The Variable Annuity Life Insurance Company (VALIC), the Supreme Court affirmed the order dismissing this matter from the Business Court Division’s docket in reliance on conclusions reached in an arbitration panel’s final decision.The first time the parties were before the Supreme Court, the Court reversed a summary judgment and remanded for further proceedings. The Court further directed that the matter be referred to the Business Court Division. Due to the complexity of the case, the parties agreed to submit the dispute to binding arbitration before a panel of three business court judges. The panel unanimously found in favor of Respondent. The Supreme Court affirmed, holding (1) there was no cause to void the parties’ agreement to submit the matter to binding arbitration; and (2) Petitioners’ arguments that the panel failed to apply the law of the case and neglected to decide all issues before it were unavailing. View "W. Va. Investment Management Board v. Variable Annuity Life Insurance Co." on Justia Law

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The Supreme Court affirmed the ruling of the circuit court denying Petitioners’ motion for leave to file a second amended complaint and dismissing their pending amended complaint, holding that the circuit court did not err in concluding that, under controlling Delaware law, Petitioners lacked standing to pursue a derivative shareholder suit.Petitioners filed a derivative lawsuit alleging claims of breach of fiduciary duties against Massey Energy Company’s Board of Directors and corporate officers. Subsequently, faced with a potential merger between Massey and Alpha Natural Resources, Inc., Petitioners filed a motion for leave to file a second amended complaint seeking to add individual and class action claims on behalf of the shareholders themselves. After the merger, Respondents moved oi dismiss Petitioners’ amended complaint and motion for leave to file the proposed second amended complaint, arguing that, after the merger, Petitioners were no longer Massey shareholders and lacked standing to assert derivative claims, and that amending their complaint a second time would be futile. The circuit court dismissed the amended complaint and denied the motion for leave to file the second amended complaint. The Supreme Court affirmed, holding that there was no error in the circuit court’s order because Petitioners were no longer Massey shareholders. View "California State Teachers' Retirement System v. Blankenship" on Justia Law

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The circuit court found merit in Petitioners’ assignments of error regarding attorneys’ fees and prejudgment interest in this litigation in which a jury awarded Respondent damages on his breach of contract and fiduciary duty claims and attorneys’ fees in the amount of $1.5 million and prejudgment interest in the amount of $959,000.Respondent and his brothers and sisters owned three corporations and one limited partnership. After Respondent’s employment with one corporation was terminated and his shares and interest in the remaining entities were redeemed, Respondent sued his four siblings and the four entities (collectively, Petitioners). Respondent prevailed after an eleven-day trial. The Supreme Court reversed in part, holding (1) Petitioners were not entitled to judgment as a matter of law on Respondent’s breach of contract and fiduciary duty claims; (2) the circuit court abused its discretion in awarding attorneys’ fees without making sufficient findings of fact and conclusions of law regarding Respondent’s entitlement to the sum awarded or its reasonableness; and (3) the circuit court erred by finding that the entire jury verdict in this case, net of offsets, constituted “special damages” subject to W. Va. Code 56-3-31 and awarding Respondent prejudgment interest. View "Tri-State Petroleum Corp. v. Coyne" on Justia Law

Posted in: Business Law