Alaska Rent-a-Car v. Avis Budget Group

Summarized by:

  • Court: 9th Circuit Court of Appeals Archives
  • Area(s) of Law: Contract Law
  • Date Filed: 03-06-2013
  • Case #: 10-35615; 10-35137
  • Judge(s)/Court Below: Circuit Judge Kleinfeld for the Court; Circuit Judges Rawlinson and Callahan
  • Full Text Opinion

A promisee who joins a settlement agreement after most other promissees is still a proper party to a breach of that agreement.

Avis and its licensees had an agreement which provided a first right of refusal over specific new locations. As part of an eventual settlement agreement to litigation on these agreements, Avis agreed that if it purchased other rental car companies, it would not use Avis’ marketing powers for the other purchased companies. In 2002, Avis purchased Budget Rent-A-Car, and combined Avis’ and Budget’s sales forces. Alaska Rent-A-Car sued Avis for breach of the settlement agreement. The district court held that since Alaska Rent-A-Car was a proper party to the agreement, Avis had breached the agreement. The Ninth Circuit affirmed that Alaska Rent-a-Car was a promisee under the agreement, despite having joined the settlement agreement late. The panel further held that it was not an abuse of discretion to deny Avis’ preemptory challenges, which were used on the only two Alaska natives on the panel who expressed views similar to other jurors, because Avis’ rights were not affected. Additionally, the panel held that allowing the testimony of a witness for Alaska Rent-A-Car who testified to a “conservative estimate” for damages was not an abuse of discretion, and it was reasonable for the jury to have awarded $16 million. Finally, Avis challenged the prejudgment interest award of 9% per annum, which was based on Alaska Rent-A-Car’s witness. Avis claimed that the jury did not separate past lost profits from future lost profits. The Court found that interest was reasonably calculated. The interest awarded was also reduced by $57,739.51 due to what both parties agreed was double counting. AFFIRMED.

Advanced Search