News & Analysis as of

Covenant of Good Faith and Fair Dealing

Miller Canfield

Michigan Supreme Court Confirms: No Independent Cause of Action for Breach of Implied Covenant of Good Faith

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Sometimes an expected result is still newsworthy. On March 27, 2025, in Kircher v Boyne USA, Inc., the Michigan Supreme Court held that there is no independent cause of action for breach of the implied covenant of good faith...more

Carlton Fields

Seventh Circuit Holds Liability Carrier Did Not Act in Bad Faith by Paying Underinsured Motorist Benefits After Four Years of...

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In Wolf v. Riverport Insurance Co., the Seventh Circuit Court of Appeals affirmed the district court’s holding, under Illinois law, that an underinsured motorist insurer did not breach its insurance contract, and no implied...more

Carlton Fields

California Appellate Court Rules Wildfire Debris Does Not Qualify as “Direct Physical Loss” Under Homeowners Insurance Policy

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The Second Appellate District of the California Court of Appeal recently affirmed a lower court ruling that wildfire debris on an insured’s property did not qualify as “direct physical loss” within the meaning of a homeowners...more

McGuireWoods LLP

Xerox Obtains Important Pro-Policyholder Decision in New York’s First Department, Adopting Narrow Construction of “Arising From”...

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In March last year, New York’s Appellate Division – First Department issued Xerox an important pro-policyholder decision in its D&O insurance recovery action against Travelers, arising from Xerox’s failed 2018 merger with...more

Lewitt Hackman

Franchisor 101: Convenient Franchise Practices

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A New Jersey federal district court granted summary judgment in favor of 7-Eleven, Inc. in a dispute with a franchisee. The franchisee signed a franchise agreement to operate a 7-Eleven store in Princeton, New Jersey,...more

Zelle  LLP

Federal Court Correctly Concludes that a Simple Disagreement Between Experts Does Not Support a Claim for the Breach of the Duty...

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U.S. District Court Xavier Rodriguez of the United States District Court for the Western District of Texas recently issued a decision granting summary judgment for an insurance carrier in a first-party case involving alleged...more

Morris James LLP

Superior Court Sustains Alternative Claims for Breach of Contract and Implied Covenant in Dispute Between Medicare Advantage...

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Premium Choice Ins. Servs. v. Innovative Fin. Group Holdings, LLC, C.A. No. N24C-01-006 PRW CCLD (Del. Super. Ct. July 9, 2024) - Plaintiff Premium and defendant IFG were middlemen in the market for Medicare Advantage...more

Lathrop GPM

Pennsylvania Federal District Court Grants Battery Supplier’s Motion to Dismiss Distributor’s Breach of Contract Counterclaims for...

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A federal court in Pennsylvania recently granted battery supplier C&D Technologies, Inc.’s motion to dismiss counterclaims brought by its former distributor Elliott Auto Supply Co, Inc. d/b/a Factor Motor Parts’ (FMP). C&D...more

King & Spalding

New York Appellate Court Blocks Mezzanine Borrower’s Claim Against Lender for Breach of Implied Covenant of Good Faith and Fair...

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On October 5, 2023, the First Department of New York’s Appellate Division limited the ability of borrowers to use a claim for breach of the implied covenant of good faith and fair dealing as a club to prevent lenders from...more

Morris James LLP

Chancery Enforces LLC Agreement in Prince Estate Dispute

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McMillan v. Nelson, C.A. 2024-0016-KSJM (Del. Ch. July 5, 2024) - In a dispute over the management of Prince Legacy, LLC, an entity formed to manage assets from the estate of the late musician Prince, the Court of...more

Freiberger Haber LLP

Breach of Contract, The Covenant of Good Faith and Fair Dealing and Unjust Enrichment

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In Singh v. T-Mobile, 2024 N.Y. Slip Op. 05554 (2d Dept. Nov. 13, 2024) (here), the Appellate Division, Second Department affirmed the dismissal of an action for, among other things, breach of contract, breach of the covenant...more

Bowditch & Dewey

Is Your Close Corporation’s Real Estate Safe from Shareholder Claims of Ownership by Adverse Possession?

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In a case of first impression, the Land Court decided that shareholders of Massachusetts close corporations may acquire corporate real estate by adverse possession. In Szawlowski v. Szawlowski Realty, Inc., the Court...more

Lathrop GPM

Delaware Case Examines Amendment-by-Merger Provision of LLC Act

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On  August 30, 2024, the Delaware Court of Chancery issued an opinion in Campus Eye Management Holdings, LLC v. DiDonato, dismissing a challenge to a merger effecting an amendment to the limited liability company agreement of...more

Goulston & Storrs PC

Reminder To Draft Purchase And Sale Agreements With Care

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Somerville Off. Assocs. Ltd. P'ship v. Cresset Dev., LLC, 104 Mass. App. Ct. 1108 (2024). In Somerville Office Associates Limited Partnership v. Cresset Development, LLC, plaintiff Somerville Office Associates (“SOA”)...more

Davis Wright Tremaine LLP

CBCA Addresses How To Avoid Release Language in an Executed Contract Modification

Contractors frequently execute modifications for extra work without considering the impact the boilerplate broad release language in the modification may have on future claims. Government agencies often seek dismissal of a...more

Cozen O'Connor

The Time Limited Demand and Duty to Settle: Common Themes and Advising Your Insurer Client How to Avoid Bad Faith

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There must be something in the water or the plaintiff’s bar just had a conference where the keynote speaker addressed strategies for putting pressure on insurers by issuing time-limited demands (“TLD”) because we have been...more

Lewitt Hackman

Franchisor 101: Charging Toward Arbitration

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A California federal court granted a motion to compel arbitration by retail franchisor Batteries Plus and its two executives, and dismissed a franchisee’s action alleging violations of the California Franchise Investment Law,...more

Winstead PC

Court Affirmed The Removal Of An Executor For Gross Mismanagement

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In Gordon v. Gordon, a couple created a revocable trust and named a friend, who provided financial advice, as successor trustee. No. 03-22-00454-CV, 2024 Tex. App. LEXIS 3611 (Tex. App.—Austin May 23, 2024, no pet. history)....more

Lowenstein Sandler LLP

When You’re Close to Settlement but Your Insurer is Entrenched: How Policyholders Can Make it Over the Finish Line

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Today on “Don't Take No for an Answer,” hosts Lynda A, Bennett and Eric Jesse discuss what they see as an increase in insurers acting in bad faith trying to avoid their coverage obligations, with more roadblocks, more...more

Epstein Becker & Green

The Implied Covenant of Good Faith and Fair Dealing in Healthcare: Insights from the Supreme Court of New Jersey

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The Supreme Court of New Jersey recently issued its decision in Comprehensive Neurosurgical, P.C. v. Valley Hospital, vacating a $24.3 million award to a neurosurgery practice....more

Clark Hill PLC

California Court of Appeals Rejects “Constructive Termination” as a Viable Theory of Contractual Recovery

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Here’s an interesting case from the California Court of Appeals dealing with a unique issue that can arise in beverage distribution contracts – can a supplier “constructively terminate” a distribution agreement through its...more

Lathrop GPM

California Federal Court Grants Retail Franchisor’s Motion to Compel Arbitration and Dismisses Action

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A federal court in California recently granted a motion brought by a franchisor and two of its employees to compel arbitration and dismiss an action alleging violations of the California Franchise Investment Law, breach of...more

Parker Poe Adams & Bernstein LLP

NC Supreme Court: Credit Union Can Unilaterally Add Arbitration Provision and Class Action Waiver to Agreements

The North Carolina Supreme Court on Thursday, May 23 held that a credit union’s unilateral update to add an arbitration provision and class action waiver to its contract with one of its customers was valid under North...more

DarrowEverett LLP

Adverse Possession in a Closely Held Company? ‘Stash’ This One Away

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Imagine for a moment that you’re a shareholder in a closely held corporation. In most jurisdictions, that status as a shareholder obligates you to a heightened fiduciary duty to your fellow shareholders. Now imagine that your...more

Morris James LLP

Chancery Invokes the Implied Covenant to Invalidate Shareholder Rights Plan

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Whitestone REIT Operating Partnership L.P. v. Pillarstone Capital REIT, C.A. No. 2022-0607-LWW (Del. Ch. Jan. 25, 2024) - In Delaware, the implied covenant of good faith and fair dealing is inherent in all contracts and...more

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