Justia Civil Procedure Opinion Summaries

Two employees of a publicly traded company raised concerns internally that the company had overstated its earnings by not accounting for slower-than-expected drilling speeds. Subsequently, an article in The Wall Street Journal reported similar allegations, and within three months, the company terminated both employees. The employees then filed a complaint with the Secretary of Labor, claiming their termination violated whistleblower protections under the Sarbanes-Oxley Act (SOX). An administrative proceeding resulted in a preliminary order for their reinstatement, which the company ignored.The employees sought to enforce the reinstatement order in the United States District Court for the District of New Jersey. The District Court dismissed the case for lack of subject-matter jurisdiction, interpreting the relevant statute as not granting it the power to enforce the preliminary order. The employees appealed this decision.While the appeal was pending, the employees chose to abandon the administrative process and filed a separate civil action in federal court. Consequently, the administrative proceedings were terminated. The company then moved to dismiss the appeal on mootness grounds.The United States Court of Appeals for the Third Circuit reviewed the case and determined that the employees' request to enforce the preliminary reinstatement order no longer satisfied the redressability requirement for Article III standing. The preliminary order was extinguished with the dismissal of the administrative proceedings, and a federal court cannot enforce a non-existent order. Therefore, the employees lost Article III standing during the litigation, and no exception to mootness applied. The Third Circuit vacated the District Court’s judgment and remanded the case with instructions to dismiss it on mootness grounds. View "Gulden v. Exxon Mobil Corp" on Justia Law

In 2022, NavSav Holdings, LLC, a Texas insurance company, acquired Universal Group, Ltd., a Nebraska insurance company. Following the acquisition, NavSav required Universal’s employees to sign noncompete and nonsolicitation covenants, which included Texas choice-of-law and forum-selection clauses. In June 2023, three employees—Austin Michael Beber, Cody Roach, and Jackie Damon—resigned from NavSav and joined a rival company, taking customers with them. NavSav claimed these customers were worth approximately $510,000 in annual premiums.Beber, Roach, and Damon filed lawsuits in Nebraska state court seeking declaratory and injunctive relief, arguing that Nebraska law should apply and the covenants were unenforceable. NavSav filed a lawsuit in Texas state court against the three employees and their new employer, seeking to enforce the covenants under Texas law. The Nebraska cases were removed to the United States District Court for the District of Nebraska, and the Texas case was removed to the United States District Court for the Eastern District of Texas. The Nebraska federal court issued antisuit and preliminary injunctions in favor of the employees, preventing NavSav from litigating in Texas and enforcing the covenants.The United States Court of Appeals for the Eighth Circuit reviewed the case. It vacated the antisuit injunctions for Roach and Damon, affirming only Beber’s antisuit injunction, as his Nebraska case was filed first. The court vacated all preliminary injunctions, finding that the district court erred in its analysis of irreparable harm, which should focus on the individual movants rather than state public policy. The court remanded Beber’s case for consideration of his request for declaratory relief and instructed the district court to evaluate the status of the Texas litigation for Roach and Damon’s cases to determine appropriate actions. The court dismissed NavSav’s appeal regarding the forum-selection clauses for lack of jurisdiction. View "Beber v. Navsav Holdings, LLC" on Justia Law

Plaintiffs Jay and Siv Bennett, along with their corporation Kesha Marketing, Inc., were long-time associates of Isagenix International LLC, a multi-level marketing company. In May 2023, Isagenix informed the Bennetts that it would not renew their accounts, which were set to expire in June 2023. The Bennetts, whose sole income came from Isagenix commissions, sued the company and obtained a preliminary injunction to prevent the termination of their business relationship.The United States District Court for the District of Arizona granted the preliminary injunction, finding that the Bennetts were likely to succeed on the merits of their claims. The court concluded that the contracts between the Bennetts and Isagenix were likely bilateral and that the modifications allowing Isagenix to terminate the contracts at will were not valid under Arizona law. The district court also found that the Bennetts would suffer irreparable harm due to the contractual limitation on consequential damages.The United States Court of Appeals for the Ninth Circuit reviewed the case and agreed with the district court that the Bennetts had shown a likelihood of success on the merits. The Ninth Circuit held that the contracts were likely bilateral and that the modifications were not validly executed under Arizona law. However, the Ninth Circuit found that the district court erred in its analysis of irreparable harm. The appellate court held that a contractual limitation on consequential damages does not constitute irreparable harm for purposes of equity. Consequently, the Ninth Circuit vacated the preliminary injunction and remanded the case for further proceedings to address the Bennetts' other theories of irreparable injury. View "BENNETT V. ISAGENIX INTERNATIONAL LLC" on Justia Law

Gasoline consumers alleged that various oil producers colluded with the U.S. government, including then-President Trump, to negotiate with Russia and Saudi Arabia to cut oil production, limit future oil exploration, and end a price war on oil. Plaintiffs claimed this agreement fixed gas prices in violation of Sherman Act § 1, suppressed competition in violation of Sherman Act § 2, and involved anticompetitive mergers in violation of Clayton Act § 7.The United States District Court for the Northern District of California dismissed the case, finding it lacked subject-matter jurisdiction under the political question and act of state doctrines. The court also found that Plaintiffs failed to adequately plead an antitrust conspiracy. Additionally, the court dismissed Defendant Energy Transfer for lack of personal jurisdiction and denied Plaintiffs leave to amend their complaint, as well as requests for additional discovery and oral argument.The United States Court of Appeals for the Ninth Circuit affirmed the district court’s dismissal. The court held that the political question doctrine barred judicial review of the President’s foreign policy decisions, as these decisions are committed to the political branches of government. The court also found no judicially manageable standards to resolve the claims under antitrust laws. Additionally, the act of state doctrine barred the claims because they involved evaluating the petroleum policies of foreign nations. The court further held that Plaintiffs failed to state a plausible antitrust conspiracy claim regarding Defendants’ private conduct. Finally, the court found no abuse of discretion in the district court’s procedural rulings. View "D'Augusta v. American Petroleum Institute" on Justia Law

The case involves Plaintiff-Appellant Joel J. Malek, who filed a complaint alleging that Defendants-Appellees, including Leonard Feigenbaum and AXA Equitable Life Insurance Co., engaged in a deceptive marketing scheme to trick him and others into replacing their existing life insurance policies with more expensive and less valuable ones. Malek claimed violations of New York law and the Racketeer Influenced and Corrupt Organizations Act (RICO).The United States District Court for the Eastern District of New York dismissed Malek’s complaint and denied him leave to amend. The court found that Malek’s New York claims were time-barred and that he failed to plead the existence of a RICO enterprise. Malek served a motion for reconsideration on the Defendants but did not file it with the court until after the deadline. The district court subsequently denied the motion for reconsideration.The United States Court of Appeals for the Second Circuit reviewed the case. The Defendants moved to dismiss the appeal, arguing that Malek’s notice of appeal was untimely because he did not file his motion for reconsideration within the required timeframe, thus failing to toll the deadline for filing a notice of appeal. The Second Circuit reiterated its holding in Weitzner v. Cynosure, Inc. that Appellate Rule 4(a)(4)(A) requires timely filing, not just service, of a post-judgment motion to toll the appeal deadline. The court also concluded that under Nutraceutical Corp. v. Lambert, Appellate Rule 4(a)(4)(A) is a mandatory claim-processing rule not subject to equitable tolling.The Second Circuit found that Malek’s notice of appeal was untimely and dismissed the appeal for lack of appellate jurisdiction. The court also determined that Malek’s notice of appeal could not be construed to include the order denying reconsideration. View "Malek v. Feigenbaum" on Justia Law

Richard Wade, the former president, CEO, and director of Vertical Computer Systems, Inc., was sued in April 2020 by the company's chief technical officer and several shareholders for breach of fiduciary duty and fraud. Wade's address was initially listed as "3717 Cole Avenue, Apt. 293, Dallas, Texas 75204." After a year, the claims against Wade were severed into a separate action, and the trial court ordered binding arbitration. Wade's attorney later filed a motion to withdraw, listing Wade's address as "3717 Cole Ave., Apt. 277, Dallas, Texas 75204." Notice of the trial was sent to this incorrect address.The trial court scheduled a bench trial for April 19, 2022, and Wade appeared pro se but did not present any evidence. The court ruled in favor of the plaintiffs, awarding them over $21 million. Wade filed a pro se notice of appeal, arguing that he did not receive proper notice of the trial. The Court of Appeals for the Fifth District of Texas affirmed the judgment.The Supreme Court of Texas reviewed the case and found that Wade did not receive proper notice of the trial setting, which violated his due process rights. The court noted that the notice was sent to an incorrect address and that Wade had informed the trial court of this issue. The court held that proceeding to trial without proper notice was reversible error and that Wade was entitled to a new trial. The court reversed the judgment of the Court of Appeals and remanded the case to the trial court for further proceedings. View "Wade v. Vertical Computer Systems, Inc." on Justia Law

CSX Transportation, Inc. sued Norfolk Southern Railway Company and Norfolk & Portsmouth Belt Line Railroad Company in 2018, alleging that they conspired to exclude CSX from competing in the international shipping market at the Norfolk International Terminal by imposing an exclusionary switch rate starting in 2010. CSX claimed this rate caused ongoing injury to its business. The key issue was whether the Sherman Act’s four-year statute of limitations barred CSX’s claims or if an exception applied.The United States District Court for the Eastern District of Virginia granted summary judgment to the defendants, finding CSX’s claims time-barred. The court held that the continuing-violation doctrine did not apply because the decision to maintain the switch rate did not constitute a new act causing new injury within the limitations period. The court also found that CSX failed to show specific damages resulting from any acts within the limitations period.The United States Court of Appeals for the Fourth Circuit affirmed the district court’s judgment. The Fourth Circuit agreed that the continuing-violation doctrine did not apply because maintaining the switch rate was not a new act but a continuation of the initial decision. The court also found that CSX did not provide sufficient evidence of new antitrust injury within the limitations period. The court emphasized that for the continuing-violation doctrine to apply, there must be an overt act within the limitations period that causes new injury, which CSX failed to demonstrate. Therefore, the court held that CSX’s claims were time-barred and affirmed the district court’s judgment. View "CSX Transportation, Incorporated v. Norfolk Southern Railway Company" on Justia Law

Ronald Goldschmidt appealed the dismissal of his prohibition claim against Judge Alan Triggs and Magistrate Thomas Beridon of the Hamilton County Court of Common Pleas. Goldschmidt argued that Magistrate Beridon exceeded his authority by issuing a magistrate’s order instead of a magistrate’s decision regarding a charging order. This charging order was related to a civil action where Goldschmidt was found liable for over $1.5 million, and Elm Investment sought to collect on this judgment through Goldschmidt’s membership interests in several limited-liability companies.The First District Court of Appeals dismissed Goldschmidt’s claim, holding that the trial court had jurisdiction to issue the charging order and that any error in how it was issued was a matter of the exercise of jurisdiction, not a lack of it. The court also found that Goldschmidt had an adequate remedy in the ordinary course of law by filing a motion to set aside the magistrate’s order.The Supreme Court of Ohio reviewed the case de novo and affirmed the First District’s judgment. The court held that the issuance of the charging order as a magistrate’s order did not exceed the trial court’s subject-matter jurisdiction. It noted that procedural errors by a magistrate do not affect the trial court’s jurisdiction and render decisions voidable, not void. The court concluded that Goldschmidt had an adequate remedy in the ordinary course of law through a motion to set aside the magistrate’s order and an appeal from any subsequent ruling on such a motion. Therefore, the court affirmed the dismissal of Goldschmidt’s complaint for a writ of prohibition. View "State ex rel. Goldschmidt v. Triggs" on Justia Law

The City of Los Angeles contracted with PricewaterhouseCoopers (PwC) to modernize the billing system for the Department of Water and Power (LADWP). The rollout in 2013 resulted in billing errors, leading the City to sue PwC in 2015, alleging fraudulent misrepresentation. Concurrently, a class action was filed against the City by Antwon Jones, represented by attorney Jack Landskroner, for overbilling. Discovery revealed that the City’s special counsel had orchestrated the class action to settle claims favorably for the City while planning to recover costs from PwC.The Los Angeles County Superior Court found the City engaged in extensive discovery abuse to conceal its misconduct, including withholding documents and providing false testimony. The court imposed $2.5 million in monetary sanctions against the City under the Civil Discovery Act, specifically sections 2023.010 and 2023.030, which allow sanctions for discovery misuse.The California Court of Appeal reversed the sanctions, interpreting the Civil Discovery Act as not granting general authority to impose sanctions for discovery misconduct beyond specific discovery methods. The appellate court held that sections 2023.010 and 2023.030 do not independently authorize sanctions but must be read in conjunction with other provisions of the Act.The Supreme Court of California reversed the Court of Appeal’s decision, holding that the trial court did have the authority to impose monetary sanctions under sections 2023.010 and 2023.030 for the City’s pattern of discovery abuse. The Supreme Court clarified that these sections provide general authority to sanction discovery misuse, including systemic abuses not covered by specific discovery method provisions. View "City of Los Angeles v. Pricewaterhousecoopers, LLP" on Justia Law

Taxinet Corporation sued Santiago Leon, alleging various claims stemming from a joint effort to secure a government concession for a taxi-hailing app in Mexico City. The district court granted summary judgment for Leon on all claims except for a Florida-law unjust enrichment claim, which went to trial along with Leon’s counterclaims for fraudulent and negligent misrepresentation. The jury awarded Taxinet $300 million for unjust enrichment and Leon $15,000 for negligent misrepresentation. However, the district court granted Leon’s Rule 50(b) motion for judgment as a matter of law, ruling that the damages award was based on inadmissible hearsay and was speculative.The United States District Court for the Southern District of Florida initially allowed testimony regarding a $2.4 billion valuation by Goldman Sachs, which was later deemed inadmissible hearsay. The court concluded that without this evidence, there was insufficient support for the jury’s $300 million award. The court also noted that the valuation was speculative and not directly tied to the benefit conferred by Taxinet in 2015.The United States Court of Appeals for the Eleventh Circuit affirmed the district court’s Rule 50(b) order, agreeing that the valuation evidence was inadmissible hearsay and that the remaining evidence was insufficient to support the $300 million award. However, the appellate court exercised its discretion to remand for a new trial on the unjust enrichment claim. The court found that Taxinet had presented enough evidence to show that it conferred a benefit on Leon, which he accepted, and that it would be inequitable for him to retain the benefit without payment. The court also noted that Taxinet could potentially present other evidence of damages in a new trial.The appellate court affirmed the district court’s summary judgment on Taxinet’s other claims, ruling that the alleged joint venture agreement was subject to Florida’s statute of frauds, as it could not be completed within a year. Thus, any claims based on the existence of the joint venture agreement were barred. View "Taxinet Corp. v. Leon" on Justia Law