Narrative Opinion Summary
In this case, minority owners of fractional interests in cellular telephone partnerships appealed a summary judgment from the U.S. District Court for the Western District of Washington, which favored AT&T Wireless Services (AWS). The core issues revolved around claims of breach of contract, implied duty of good faith, and fiduciary duties related to asset sales and service fees. AWS, holding a majority interest, conducted asset sales to an affiliated entity, prompting disputes on fiduciary duties under the Revised Uniform Partnership Act. The district court granted summary judgment to AWS and excluded a late-filed expert report from the minority owners. The Ninth Circuit affirmed these decisions but certified a vital question to the Washington Supreme Court regarding whether such sales violated the duty of loyalty when partnership agreements do not specifically address related party transactions. The resolution of the appeal is contingent on the response from the Washington Supreme Court. Proceedings are stayed pending this decision, and parties must report on the court's determination, which could potentially reverse the district court's summary judgment if the court finds a breach of loyalty.
Legal Issues Addressed
Certification of State Law Question to Supreme Courtsubscribe to see similar legal issues
Application: The Ninth Circuit certified a critical state law question to the Supreme Court of Washington regarding the permissibility of asset sales to affiliated parties under the Revised Uniform Partnership Act.
Reasoning: The current order certifies a critical state law question to the Supreme Court of Washington, specifically whether the Revised Uniform Partnership Act permits a controlling partner to sell all partnership assets to an affiliated party.
Exclusion of Late-Filed Expert Witness Reportsubscribe to see similar legal issues
Application: The court upheld the exclusion of the minority owners' late-filed expert witness report, which failed to provide a coherent opinion on the fair value of the partnerships at the time of asset sales.
Reasoning: The court also upheld the exclusion of the minority owners' late-filed expert witness report, which failed to provide a coherent opinion on the fair value of the partnerships at the time of asset sales.
Fiduciary Duty of Loyalty under Revised Uniform Partnership Actsubscribe to see similar legal issues
Application: The case raises a question about whether a controlling partner breaches the duty of loyalty by facilitating a sale of all assets to an affiliated party when the partnership agreement is silent on related party sales, leading to certification of this question to the Washington Supreme Court.
Reasoning: The document addresses the scope of a partner’s fiduciary duty of loyalty in self-dealing transactions not explicitly authorized by the partnership agreement.
Summary Judgment under Federal Jurisdictionsubscribe to see similar legal issues
Application: The Ninth Circuit affirmed the district court's summary judgment favoring AWS on claims by minority owners for breach of contract, implied duty of good faith, and fiduciary duty of care regarding service fees.
Reasoning: The district court's summary judgment favoring AWS on claims by minority owners for breach of contract, implied duty of good faith, and fiduciary duty of care regarding service fees was affirmed.