Modern building.Modern office building with facade of glass
Representing Businesses and Business Owners Contact Us Now!
Justia Lawyer Rating
Published on:

Plaintiffs often attempt to pursue punitive damages in litigation. Punitive damages are intended to punish reprehensible conduct by a defendant. Cooper Industries, Inc. v. Leatherman Tool Group, Inc., 532 U.S. 424 (2001). Punitive damages can be attractive for plaintiffs because they can multiply compensatory damages thereby resulting in a much larger recovery. See Fla. Stat. § 768.83 (generally allowing up to three times multiplier for punitive damages). In Florida, a plaintiff must move to amend its complaint to add a claim of punitive damages to recover punitive damages. The plaintiff must make a “reasonable showing by the evidence” supporting entitlement to punitive damages. Fla. Stat. § 768.72(1). What constitutes a “reasonable showing by the evidence”? The Supreme Court of Florida might answer this question in Fed. Ins. Co. v. Perlmutter, Case No. SC2024-0058 if it elects to assert jurisdiction over the matter. The Fort Lauderdale business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

The Florida appellate courts established conflicting standards for how much evidence a plaintiff must proffer to add a claim for punitive damages. The Fifth District Court of Appeal and Second District Court of Appeal established relatively low standards. In Estate of Despain v. Avante Group Inc., 900 So. 2d 637 (Fla. 5th DCA 2005), the Fifth District Court of Appeal held that a plaintiff must proffer “merely a representation of what evidence the defendant proposes to present and is not actual evidence.” In Deaterly v. Jacobson, 313 So. 3d 798 (Fla. 2d DCA 2021), the Second District of Appeal held that the clear and convincing evidentiary standard used to prove punitive damages at trial under Florida Statute Section 768.72 does not apply to a plaintiff moving for leave to amend to add a punitive damages claim because Section 768.72 only applies at trial.

However, in Fed. Ins. Co. v. Perlmutter, 376 So. 3d 24 (Fla. 4th DCA 2023), the Fourth District Court of Appeal established a higher standard for adding punitive damage claims. In Perlmutter, the Fourth DCA addressed a trial court order granting a plaintiffs’ motion to amend to add a claim of punitive damages. The Fourth DCA reversed the trial court’s order finding that the plaintiffs did not make a sufficient evidentiary showing supporting a punitive damages claim. The Fourth DCA held that adding a claim for punitive damages requires “the trial court to make a preliminary determination of whether a reasonable jury, viewing the totality of proffered evidence in the light most favorable to the movant, could find by clear and convincing evidence that punitive damages are warranted.” Thus, unlike the Second DCA’s holding in Deaterly, the Fourth DCA held that the clear and convincing standard must be considered at the pleading stage. However, it appears the Fourth DCA was not positive in its conclusion because the Fourth DCA certified the question to the Supreme Court of Florida based on the conflict with the Second DCA and Fifth DCA rulings.

Published on:

Parties to a lawsuit are generally responsible for paying their own attorney’s fees regardless of the lawsuit’s outcome. This is known as the “American Rule.” However, exceptions to the American Rule exist when the lawsuit arises from a breach of contract that contains an attorney’s fee provision or the violation of a statute that contains an attorney’s fees-shifting provision. MV Senior Management, LLC v. Redus Florida Housing, LLC, 319 So. 3d 66 (Fla. 1st DCA 2020). These contracts and statutes require the non-prevailing party in the litigation to pay the reasonable attorney’s fees of the prevailing party. But determining who prevailed in complex lawsuits with multiple parties, claims, crossclaims, and counterclaims can be difficult. The Miami business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

The leading case in Florida for determining who is the prevailing party in a breach of contract action is Moritz v. Hoyt Enterprises, Inc., 604 So. 2d 807 (Fla. 1992). In Moritz, the Supreme Court of Florida held that the prevailing party in litigation is the party that prevails on the “significant issues” in the case. The purchasers of a home paid an initial down payment to a vendor to purchase the home. The purchasers then attempted to repudiate the contract and subsequently sued for breach of contract to recover their down payment. The vendor counterclaimed for breach of contract. The trial court found that the purchasers breached the contract and the vendor did not. However, the trial court also ordered the vendor to return the difference between the purchaser’s down payment and the vendor’s damages to the purchaser. The Florida Supreme Court found that the significant issue in the litigation was the breach of contract issue. Therefore, because the vendor prevailed on that issue, the vendor was the prevailing party and entitled to attorney’s fees even though the purchasers were entitled to a larger judgment award.

Moritz indicates that, at times, it may be difficult to determine who is the prevailing party based on the “significant issue” test. The Supreme Court of Florida further addressed the matter in Prosperi v. Code, Inc., 626 So. 2d 1360 (Fla. 1993), where it stated that a net judgment is a “significant factor” but does not necessarily control the determination of who is the prevailing party. Interestingly, in cases involving the Florida Deceptive and Unfair Trade Practices Act (FDUTPA), the Florida Fourth District Court of Appeal continues to focus on whether a party obtained a net judgment. FDUTPA claims are commonly included in lawsuits because FDUTPA has broad application and a fee-shifting provision. See Fla. Stat. § 501.2105 (2024). For example, in Banner v. Law Office of David J. Stern, P.A., 198 So. 3d 1133 (Fla. 4th DCA 2016), the Fourth District Court of Appeal held that “where a claim involves multiple claims directed at the same conduct,” to recover attorney’s fees, a party must “(1) recover judgment on the [FDUTPA claim], and (2) recover a net judgment for the entire case.”  Employment litigation also has fee shifting provisions, sometimes evenly shifting fees to the winning party and in other statutes, the fee shifting is explicitly deferential to the litigating employee if he or she wins the case.

Published on:

Sometimes businesses enter contracts under false pretenses because certain material information is misrepresented or concealed from the business. The business can assert a claim for fraudulent inducement to try and escape the contract. However, the business will have to prove the misrepresentation was made with fraudulent intent. Gemini Inv’rs III, L.P. v. Nunez, 78 So. 3d 94 (Fla. 3d DCA 2012) (“To plead fraudulent inducement, Gemini must allege that the defendants: (1) made a statement concerning a material fact, (2) knowing that the statement was false, (3) with intent that the plaintiffs act on the false statement; and (4)… damage[s].”). This element can be difficult to prove. See Collins v. McKelvain, 189 So. 655, 656 (Fla. 1939) (recognizing that it can be difficult to prove fraudulent inducement at the time the agreement is consummated). Asserting a claim for negligent misrepresentation offers an alternative avenue for redress. The Fort Lauderdale business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

To prevail on a claim of negligent misrepresentation, a plaintiff must prove the following elements:

  • A misrepresentation of material fact;
Published on:

Under Florida law, the rule of judicial estoppel prohibits a litigant from taking a position in a former action or judicial proceeding and then taking an inconsistent position in a subsequent action or judicial proceeding that prejudices the adverse party. Blumberg v. USAA Casualty Insurance Co., 790 So. 2d 1061 (Fla. 2001). The rule is designed to prevent litigants from making a mockery of the justice system. Scarano v. Cen. R. Co. of N.J., 203 F. 2d 510 (3rd Cir. 1953) (A situation justifying application of judicial estoppel “is more than affront to judicial dignity [because] intentional self-contradiction is being used as a means of obtaining unfair advantage in a forum provided for suitors seeking justice.”). The Miami business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

The judicial estoppel rule has three considerations. The first is party mutuality because application of the judicial estoppel doctrine only applies when the parties of the earlier proceeding and subsequent proceeding are the same. Blumberg, 790 So. 2d 1061. However, party mutuality is not required when “special fairness and policy considerations” compel application of the doctrine. The rationale for creating an exception to party mutuality is that the same exception applies in similar contexts such as res judicata and collateral estoppel. See West v. Kawasaki Motors Mfg. Corp., 595 So. 2d 92 (Fla. 3d DCA 1992) (“Florida courts have on occasion recognized exceptions to the identity of parties requirement under the res judicata or collateral estoppel doctrines where special fairness or policy considerations appear to compel it.”). Therefore, court have reasoned that the party mutuality exception should be extended to apply in the judicial estoppel context too. See Keyes Co. v. Bankers Real Estate Partners, Inc., 881 So. 2d 605 (Fla. 3d DCA 2004) (applying judicial estoppel even through party mutuality did not exist).

The second consideration is whether the party asserting the judicial estoppel argument was misled and changed positions based on the opposing party’s initial position in the first judicial proceeding. The judicial estoppel rule used to require a party to demonstrate it had been misled by the opposing party and changed positions as a result. See Chase & Co. v. Little, 156 So. 609 (Fla. 1934) (“The party claiming the estoppel must have been misled and have changed his position.”). However, Florida law appears to have dispensed with these requirements because Florida’s Supreme Court allowed a litigant to prevail on a judicial estoppel argument without demonstrating he was misled or changed positions. Blumberg, 790 So. 2d 1061.

Published on:

The Federal Trade Commission’s (FTC) rule banning most non-compete agreements continues to produce legal developments. Conflicting opinions were previously issued by a court in the U.S. District Court for the Northern District of Texas and by a court in the U.S. District Court for the Eastern District of Pennsylvania. In Ryan LLC v. FTC, Case No. 3:24-CV-00986-E, 2024 WL 3297524 (N.D. Tex., July 3, 2024), the United States District Court for the Northern District of Texas issued a preliminary injunction prohibiting the enforcement of the FTC’s rule against the named plaintiff in that case. On the other hand, in ATS Tree Services, LLC v. FTC, Case No. 2:24-CV-01743, 2024 WL 3511630 (E.D. Pa., July 23, 2024), the court denied a motion for a preliminary injunction to prevent enforcement of the rule. On August 20, 2024, this legal saga saw another significant development as the Ryan LLC court issued a permanent injunction against the FTC rule in Ryan LLC v. FTC, Case No. 3:24-CV-00986, 2024 WL 3879954 (N.D. Tex., Aug. 20, 2024). Unlike the preliminary injunction that the court previously issued, the permanent injunction is national. The non-compete agreement ban, which was scheduled to go into effect on September 4, 2024, is now nullified due to the permanent injunction of the federal court. This, however, is subject to appeal and other possible legal developments. The Fort Lauderdale business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

The federal court in Ryan LLC issued the permanent injunction based on many of the same reasons as its preliminary injunction entered earlier in the case. The Judge relied heavily on the federal Administrative Procedures Act (APA), which requires that courts set aside administrative agency actions when they are “arbitrary, capricious, or otherwise not in accordance to the law” or “in excess of statutory jurisdiction, authority, limitations, or short of statutory right.” 5 U.S.C. § 706. In applying the APA, the court found that the FTC Act does not grant substantive rulemaking authority to the FTC, and the non-compete ban is arbitrary and capricious. 2024 WL 3879954. The court reasoned that the FTC Act does not grant it substantive ruler making authority. Section 6 only vested the FTC with the authority “to make rules and regulations to carry out the provisions of the subchapter.” The Ryan LLC court characterized section 6 as a “housekeeping” statute. See also Chrysler Corp. v. Brown, 441 U.S. 281 (1979). It lacks a statutory penalty and is in a nonessential location. In addition, the court determined the non-compete ban is arbitrary and capricious because it is unreasonably broad. The studies the FTC relied on a to enact its rule did not support a such a sweeping ban.

In reaching its holding, the Ryan LLC court did cite to Loper Bright Enterprises v. Raimondo, 144 S. Ct. 2244 (2024), the recent Supreme Court case that eliminated court deference to agency rules. This reference suggests the court did not provide deference to the rule that would normally be applied before the Looper Bright Enterprises decision. However, the court did not expressly make such a ruling.

Published on:

It is important for every business to take extensive efforts to protect their trade secrets and limit their disclosure to persons with subject to comprehensive confidentiality agreements. Often, trade secret misappropriation occurs when a business shares its trade secrets with an outside vendor. This is exactly what a plaintiff claims to have happened in Ecolab, Inc. v. IBA Inc. & Webco Chemical Corp., Case No. 4:24-cv-40407-DHH (D. Mass., August 14, 2024), a recent case filed in the U.S. District Court of Massachusetts. Ecolab shows the importance of businesses being careful with whom they share their trade secrets and effectively using confidentiality agreements. Peter Mavrick is a Miami business litigation attorney, and represents clients in Fort Lauderdale, Boca Raton, and Palm Beach. The Mavrick Law Firm represents businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

According to the complaint filed by the plaintiff, Ecolab, Inc. (Ecolab), Ecolab creates and sells infection prevention products. This includes “acified sodium chlorite teat dip products” (ASC products) that Ecolab sells to the dairy industry. Ecolab alleges it developed these products after extensive efforts over a period of several years, and its manufacturing process for its ASC products constitute trade secrets.

Ecolab contracted with IBA Inc. (IBA) in 2002 to manufacture and distribute Ecolab’s ASC products. Ecolab had to share its trade secrets with IBA to facilitate IBA’s manufacturing duties. Before disclosure, Ecolab required IBA to execute a confidentiality agreement prohibiting IBA from disclosing the trade secrets or using the trade secrets for its own purposes. The confidentiality agreement allowed IBA to disclose the trade secrets to third party subcontractors as long as the subcontractors were subject to the same confidentiality provisions. IBA then, with Ecolab’s permission, contracted with Webco Chemical Corporation (Webco) for Webco to manufacture the ASC products, while IBA would distribute them. Webco also executed a confidentiality agreement. The three parties continued this relationship until 2022, when, as Ecolab alleges, IBA and Webco stole Ecolab’s trade secrets and released their own line of competitive ASC products.

Published on:

If you replace a contract with another contract, is the original contract still enforceable? The answer to this question involves a contract principle called novation. Peter Mavrick is a Fort Lauderdale business litigation attorney.  The Mavrick Law Firm represents businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment law, and other legal disputes in federal and state courts and in arbitration.

Under Florida law, “novation is a mutual agreement between the parties to a contract for the discharge of a valid existing obligation by the substitution of a new valid obligation.” Jakobi v. Kings Creek Village Townhouse Ass’n, Inc., 665 So. 2d 325 (Fla. 3d DCA 1995). Novation is similar to modification of a contract, but with an important distinction. Modification “merely replaces some terms of a valid and existing agreement while keeping those not abrogated by the modification in effect.” Bornstein v. Marcus, 275 So. 3d 636 (Fla. 4th DCA 2019). Novation, on the other hand, completely replaces the prior agreement.

The elements for a valid novation are (1) the existence of a previously valid contract, (2) an agreement of the contracting parties to cancel the first contract, (3) an agreement of the contracting parties that the second contract replaces the first, and (4) validity of the second contract. Thompson v. Jared Kane Co., Inc., 872 So. 2d 356 (Fla. 2d DCA 2004); U.S. Home Acceptance Corp. v. Kelly Park Hills, Inc., 542 So. 2d 463 (Fla. 5th DCA 1989) (stating that a novation must be supported by valid consideration, and finding that a promise to perform an act that a party was already obligated to perform did not constitute valid consideration). The manifestation of a novation depends on the parties’ intention, which can be implied from the surrounding circumstances.

Published on:

Under Florida contract law, integration clauses (also known as merger clauses) are important to clearly define the terms of a contract. An integration clause generally limits a contract’s terms to only those that are expressly contained within the written contract. See Vigortone AG Products, Inc. v. PM AG Products, Inc., 316 F. 3d 641 (7th Cir. 2002) (“By virtue of the parol evidence rule, an integration clause prevents a party to a contract from basing a claim of breach of contract on agreements or understandings, whether oral or written, that the parties had reached during the negotiations that eventuated in the signing of a contract but that they had not written into the contract itself.”). Integration clauses can prevent contracting parties from using parol evidence to vary a contract’s terms by adding terms that are not contained within the four corners of the contract. However, some circumstances permit the use of parol even when a contract contains an integration clause. Peter Mavrick is a Miami business litigation attorney, and represents clients in Fort Lauderdale, Boca Raton, and Palm Beach. The Mavrick Law Firm represents businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

The presence of a merger clause is not the sole basis for determining whether a contract is fully integrated. Lowe v. Nissan of Brandon, Inc., 235 So. 3d 1021 (Fla. 2d DCA 2018) (“[T]he existence of a merger clause does not per se establish that the integration of the agreement is total.”). A court may allow parol evidence despite the existence of a merger clause when the contract is ambiguous, Jenkins v. Eckerd Corp., 913 So. 2d 43 (Fla. 1st DCA 2005), or when a party claims that they were fraudulently induced to enter into the contract. Fla. Potter Stores of Panama City, Inc. v. Am. Nat’l Bank, 578 So. 2d 801 (Fla. 1st DCA 1991).

The fraudulent inducement exception is limited to instances where the statement inducing fraud is not adequately discussed within the contract and not expressly contradicted by the contract. In Ioannides v. Romagosa, 93 So. 3d 431 (Fla. 4th DCA 2012), a doctor recruited another doctor to join his medical practice by telling the doctor that “his total annual compensation from salary and bonuses would easily exceed $500,000 per year . . . .” The two doctors subsequently entered a written contract explicitly stating the terms of compensation, which included a maximum base salary of $250,000 plus a “production bonus.” The contract contained an integration clause. The doctor who joined the practice quit after two years and filed a fraudulent inducement lawsuit because he was never paid more than $500,000 per year. The defending doctor moved for summary judgment based on the contract’s integration clause, but the motion was denied by the trial court. The Florida Fourth District Court of Appeals reversed and granted summary judgment based on the presence of the integration clause because the doctor’s compensation was “adequately covered” by the written agreement.

Published on:

The Court of Appeals of Virginia recently reversed a massive verdict in a trade secret misappropriation case involving two business competitors. In Pegasystems, Inc. v. Appian Corporation, ___ S.E.2d. ____, 2024 WL 3571808 (Va. 2024), the jury returned a verdict of more than $2 billion, the largest trade secret verdict in Virginia history. However, the Court of Appeals of Virginia reversed based on four errors committed by the trial court. Peter Mavrick is a Fort Lauderdale business litigation attorney.  The Mavrick Law Firm represents businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment law, and other legal disputes in federal and state courts and in arbitration.

Appian Corporation and Pegasystems, Inc., are competitors that both produce and sell business process management software. Pegasystems hired an outside consultant that worked with Appian to gain access to Appian’s software and study it. Appian discovered Pegasystems’ scheme and filed suit for trade secret misappropriation by claiming Pegasystems unlawfully gained access to its software, incorporated several features of its software into Pegasystems’ own software, and used knowledge of its software’s weaknesses in Pegasystems’ marketing. The case went to trial and the jury returned a verdict of $2,036,860,045 in favor of Appian.

The trial court’s main error was including a jury instruction that improperly shifted the burden of proof for proximate causation of damages to Pegasystems. Appian requested unjust enrichment damages; a common form of damages in trade secret lawsuits that are based on the defendant’s revenues or profits generated from using the ill-gotten trade secret. The relevant jury instruction required Appian to prove trade secret misappropriation, required Appian to establish Pegasystems’ general sales, and then shifted the burden to Pegasystems to prove the portion of its sales that were not attributable to the trade secret misappropriation. The appellate court determined this “framework impermissibly ‘shifted the burden’ to Pega[systems] to prove sales were not related to the wrongdoing and relieved Appian of its burden to prove proximate cause for the misappropriation” because Appian only had to prove enrichment rather than unjust enrichment.

Published on:

The litigation privilege protects most statements made during the course of litigation in Florida. The litigation privilege has a wide scope and covers many causes of action. The Miami business litigation attorneys of the Mavrick Law Firm represent clients in Fort Lauderdale, Boca Raton, and Palm Beach. The Mavrick Law Firm represents businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

Florida courts have historically applied the litigation privilege to causes of action for perjury and defamation. Levin, Middlebrooks, Mavie, Thomas, Mayes, & Mitchell, P.A. v. U.S. Fire. Ins. Co., 639 So. 2d 606 (Fla. 1994). In Levin, the Florida Supreme Court expanded the litigation privilege to cover all acts occurring during judicial proceedings, “whether the act involves a defamatory statement or other tortious behavior such as the alleged misconduct at issue, so long as the act has some relation to the proceeding.” The Florida Supreme Court then applied the litigation privilege to a claim of tortious interference with a business relationship.

What about claims for malicious prosecution or abuse of process? Can the litigation privilege negate a litigant’s ability to bring these claims because they are based upon the unlawful use of a legal proceeding against another. See Alamo Rent-A-Car, Inc. v. Mancusi, 632 So. 2d 1352 (Fla. 1994) (explaining that a claim for malicious prosecution is founded on allegations that the defendant maliciously brought a legal proceeding against the plaintiff without probable cause); Della-Donna v. Nova University, Inc., 512 So. 2d 1051 (Fla. 4th DCA 1987) (abuse of process involves the defendant’s improper use of process with ulterior motives). Malicious prosecution inherently involves acts that occurred during the course of litigation. In Debrincat v. Fischer, 217 So. 3d 68 (Fla. 2017), the Supreme Court of Florida determined that the litigation privilege did not apply to malicious prosecution because “[a]pplying the litigation privilege… would eviscerate [the] long-established cause of action.” Because malicious prosecution inherently involves acts that occurred during the course of a judicial proceeding, the litigation privilege would essentially eliminate malicious prosecution as a cause of action. Debrincat v. Fischer, 217 So. 3d 68 (“[M]alicious prosecution could never be established if causing the commencement or continuation of an original proceeding . . . were afforded absolute immunity . . . .”).

Contact Information