New Millennium Consulting, Inc. v. United Healthcare Services, Inc.
695 F.3d 854
8th Cir.2012Background
- Chimes developed a supplier network to provide contingent IT labor to UHS.
- The CVM between UHS and Chimes, dated 2007, includes an agency-disclaimer stating no agency relationship.
- SSAs with about 250 suppliers (including New Millennium and Pacific Management) factor into payments; Chimes pays suppliers after funds from UHS; UHS not a party to SSAs.
- PVA forms were used for vendors not in SSAs; none of New Millennium or Pacific Management signed a PVA.
- Chimes declared bankruptcy after UHS made November 2007 payment; Chimes’ creditors seized funds, leaving New Millennium and Pacific Management unpaid.
- District court granted summary judgment for UHS, holding no agency under Minnesota law due to the disclaimer and lack of consent; this was affirmed on appeal
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Chimes was UHS’s agent under Minnesota law | New Millennium and Pacific argue CVM, SSAs, and related documents create actual authority | UHS and Chimes disclaimed agency; no consent or control establishing agency | Chimes not UHS's agent as a matter of law |
| Whether the purported agency could be established through implied or apparent authority | Plaintiffs rely on contracting forms and control provisions | Disclaimer and lack of consent negate implied/apparent authority | No implied or apparent authority; agency not established |
| Whether the Restatement § 149 would bind UHS for Chimes’ contracts if agency existed | If agency existed, principal liability could attach under §149 | No agency; §149 inapplicable | Summary judgment affirmed without addressing §149 application |
Key Cases Cited
- Children’s Broadcasting Corp. v. Walt Disney Co., 245 F.3d 1008 (8th Cir. 2001) (agency requires consent; disclaimer can preclude agency)
- Mikulay v. Home Indemn. Co., 449 N.W.2d 464 (Minn. Ct. App. 1989) (agency disclaimer shows no consent to agency)
- Sipe v. Fleetwood Motor Homes, 574 F. Supp. 2d 1019 (D. Minn. 2008) (disclaimers affect agency analysis in third-party claims)
- Cardiac Pacemakers, Inc. v. Aspen Holding Co., 413 F. Supp. 2d 1016 (D. Minn. 2006) (disclaimer evidence of lack of consent to agency)
- A. Gay Jenson Farms Co. v. Cargill, Inc., 309 N.W.2d 285 (Minn. 1981) (de facto control can create agency in some contexts; distinctions noted)