Creative Commons License. Photo by BoH
Update (May 18, 2016): The original post, below, concerned a commercial dispute over a valuable contract ($72 million or more) to provide a revolving crane suitable for offshore oilfield support services. In brief, Plaintiff Blake allegedly lost a contract with non-party Oceanografia; some years later Blake allegedly discovered that the opportunity had been lost due to the tortious machinations of Defendant CarVal.
The key words there are “some years later.” Blake is an Alabama company. Alabama has a two-year statute of limitation (“SOL”) on tortious interference claims. Defendant CarVal is a Minnesota entity. Minnesota has a six-year SOL. So, in one of the many examples of civil litigation making for strange bedfellows, the Minnesota entity wants Alabama law to apply (to bar the lawsuit) but the Alabama company wants Minnesota law to apply (or, maybe, federal admiralty law?) to enable its lawsuit to go forward.
The U.S. District Court (D. Minn.) (Ericksen, J.) found that Alabama’s two-year limitation applied and so the judge held that Plaintiff’s case was time-barred.
Of course, the U.S. Court of Appeals cannot resolve the issue on appeal in this case by simply expressing its preference between a two-year or a six-year SOL. Neither can the Court of Appeals simply defer to Judge Ericksen. It must base its decision on legal analysis. The questions before the Court are difficult and well-briefed (see here, here, and here).
An aside: I also note in the Court record that both litigants got “notices of deficiency” from the 8th Circuit for problems with their briefs (here’s one and here’s another). If even the most preeminent lawyers in the country cannot follow the court’s administrivia rules, should we conclude that lawyers are sloppy or that courts are perhaps a bit too rigid and ruly?
Original post (August 2015): It costs a lot of money to rent a revolving crane suitable for offshore oilfield support services. Guess how much.
About $40,000 per day for a five year contract (for a full contract price of about $72,000,000).
Several years ago, Alabama-based Blake Marine Group landed a contract to provide such a crane to a company called Oceanografia, and it was looking to clear a profit of about $58 million.
Then Minnesota-based CarVal Investors LLC and a related entity came along…
Blake alleged in a January, 2015 complaint that:
Carval [and a related company] after learning that a contract had been entered into between Blake and Oceanografia analyzed the numbers and determined that if Oceanografia was willing to enter into a contract for $40,000 per day for 60 months Carval [and a related company] could force Oceanografia to sign a contract with Carval [and a related company] or another Carval Investors and Cargill Group affiliate entity for one of its vessels at a rate in excess of $80,000 per day to perform the PEMEX contract.
That is, Blake alleged that Carval “tortiously interfered” with Blake’s contract, causing Oceanografia to cancel the lucrative contract with Blake, and Blake alleged that the “economic interest privilege” would not apply to protect Carval’s conduct from a lawsuit by Blake.
“[I]n limited circumstances, [the economic interest privilege] may allow investors and certain creditors to protect their investments by interfering with contract that their investment enters or contemplates entering for the purpose of protecting that investment.” (Emphasis in original (at Para. 21)). In this case, however, Blake argued the privilege would not apply because Carval’s self-interested maneuver allegedly harmed Oceanografia rather than helping it…
Feel sorry for Blake? Think there must be another side of the story and Carval must have been somehow justified?
Check out Judge Ericksen’s order for a straight-forward application of the somewhat convoluted “choice-of-law” analysis that courts often have to do.
Congratulations to the Faegre Baker Daniels team (Elsa Bullard, Matthew Kilby, Randall Kahnke, and Ryan Long) who guided their client defendants to safe harbor.