Justia Civil Procedure Opinion Summaries

Four property-specific limited liability companies owned real estate in Wisconsin, which was leased to skilled nursing facilities operated by Kevin Breslin through his company, KBWB Operations, LLC. Breslin and his co-guarantors executed personal guaranties ensuring payment and performance under the leases. The nursing facility tenants defaulted on their rent obligations starting in 2018 and subsequently lost their operating licenses after a court-appointed receiver moved residents out. The tenants also failed to complete a purchase option for the properties, triggering a liquidated damages clause. Plaintiffs later sold the properties at a loss.The plaintiffs sued Breslin, his company, and co-guarantors in the United States District Court for the Northern District of Illinois to enforce the guaranties and recover damages. During the litigation, plaintiffs discovered that one co-guarantor was a California citizen, which destroyed complete diversity and thus federal jurisdiction. Plaintiffs moved to dismiss this non-diverse defendant, arguing he was not indispensable because the guaranties provided for joint and several liability. The district court agreed and dismissed him. Breslin did not oppose the dismissal. Plaintiffs then moved for summary judgment; Breslin, facing criminal charges, invoked the Fifth Amendment and presented no evidence on liability or damages. The district court granted summary judgment to plaintiffs and awarded nearly $22 million in damages across several categories.On appeal, the United States Court of Appeals for the Seventh Circuit held that jurisdiction was proper because the dismissed co-guarantor was not an indispensable party under Rule 19, given joint and several liability. The court affirmed the district court’s findings on most damages but vacated the awards for accelerated rent under one lease (pending further consideration of its enforceability as a liquidated damages clause) and for liquidated damages related to the purchase option (finding it unenforceable as a penalty). The case was remanded for recalculation of damages consistent with these holdings. In all other respects, the judgment was affirmed. View "CCP Golden/7470 LLC v. Breslin" on Justia Law

A fire at a property in Washington, D.C. in 2015 resulted in the deaths of two tenants. The parents of the tenants sued both the property’s record owner, Len Salas, and his father, Max Salas, who managed the property, for wrongful death in a D.C. trial court. The jury found both defendants jointly and severally liable and awarded multimillion-dollar verdicts. After the verdict, both Len and Max filed for bankruptcy in different jurisdictions. In Max’s bankruptcy case, the court held he was entitled to an unlimited homestead exemption in the property. Subsequently, in Len’s bankruptcy case in Tennessee, the estate’s interest in certain avoidance and recovery rights under the Bankruptcy Code was sold at auction, with the plaintiffs purchasing those rights.The plaintiffs then filed an adversary proceeding in the United States Bankruptcy Court for the Middle District of Tennessee, seeking to avoid transfers and recover property. The bankruptcy court denied their motion for summary judgment and granted partial summary judgment to Max on the fraudulent conveyance claims. Plaintiffs sought and received leave from the United States District Court for the Middle District of Tennessee to pursue an interlocutory appeal. The district court affirmed the bankruptcy court’s partial grant and denial of summary judgment and remanded the case for further proceedings, but did not certify the order for appeal or designate it as a final order.On appeal, the United States Court of Appeals for the Sixth Circuit found that it lacked jurisdiction. The court determined that because the district court’s order was neither final nor properly certified for interlocutory appeal, it could not exercise appellate jurisdiction under the relevant statutes. As a result, the Sixth Circuit dismissed the appeal for lack of jurisdiction. View "Brekelmans v. Salas" on Justia Law

A disabled individual, who uses a wheelchair, visited a toy store owned by a business entity in Los Angeles. He claimed that the sales counter was too high for him to use comfortably, allegedly deterring him from making a purchase. The individual subsequently filed lawsuits under both federal and state law, alleging violations of the Americans with Disabilities Act (ADA) and the Unruh Civil Rights Act. The federal court dismissed the ADA claim as moot after the store remedied the alleged violation, and the state court tried the Unruh Act claim. During trial, the plaintiff testified about his intent to shop and the difficulties encountered, but the store presented evidence that no such customer was seen and that employees would have greeted him.The Superior Court of Los Angeles County presided over the state Unruh Act action. The judge found the plaintiff's testimony not credible, determining that he entered the store solely to look for ADA violations rather than to shop, and did not suffer any difficulty or denial of access. Judgment was entered for the store, and the plaintiff did not appeal. The store then filed a malicious prosecution action against the plaintiff and his attorneys, alleging they pursued claims knowing essential facts refuted their allegations. The defendants moved for summary judgment, arguing they had probable cause and acted without malice. The trial court granted summary judgment for all defendants, declining to apply issue preclusion to the prior judge’s factual findings.Upon appeal, the Court of Appeal of the State of California, Second Appellate District, Division Three, held that the prior judge’s findings regarding the plaintiff’s intentions and actions were entitled to preclusive effect and sufficient to raise triable issues of fact about probable cause and malice as to the plaintiff. However, the appellate court found no similar evidence against the attorneys, as they relied on information provided by the plaintiff. The judgment was reversed as to the plaintiff and affirmed as to the attorneys. View "Landis' Labyrinth v. Whitaker" on Justia Law

A homeowners association in San Diego, governed by the Davis-Stirling Act and its own bylaws, held a recall election to remove a board director. The association distributed recall ballot materials, including a candidate statement from the sole candidate seeking to replace the director if the recall succeeded. The sitting director sought to include her own statement in these materials to advocate against her removal but was denied by the elections inspector, who reasoned that only candidate statements were included. The association’s election rules defined “association media” to exclude candidate forms or statements attached to ballots.Previously, the Superior Court of San Diego County, in a separate action brought by the same director, found no violation of the statutory equal-access requirement for association media, concluding that all candidates had equal opportunity to submit statements using the association’s forms for regular board elections. Following the recall, the director filed a new petition and complaint challenging the association’s refusal to distribute her statement, alleging violations of Civil Code section 5105, various Corporations Code provisions, and negligence. After a bench trial, the Superior Court again ruled for the association and the inspector, finding the candidate statement was not “association media” under the relevant statute and that the recall vote met statutory requirements.The California Court of Appeal, Fourth Appellate District, Division One, reversed. It held that “association media” as used in Civil Code section 5105 does encompass ballot materials containing candidate statements distributed by the association during an election. The court concluded the director was entitled to equal access to these materials to advocate her position. The court remanded for further proceedings to determine, under Civil Code section 5145, whether the association’s failure to provide equal access affected the election outcome. The judgment was reversed and remanded with directions. View "Arroyo v. Pacific Ridge Neighborhood Homeowners Assn." on Justia Law

A former deputy executive director of a bi-state agency, the Port Authority of New York and New Jersey, was prosecuted in connection with the “Bridgegate” scandal. Although convicted, his convictions were ultimately vacated and the indictment dismissed. Having incurred approximately $4 million in legal expenses, he sought indemnification from the Port Authority under its bylaws, which provide for reimbursement of legal costs upon acquittal or dismissal of criminal charges, subject to certain notice and procedural requirements.After the Port Authority denied his request for indemnification, he commenced suit in New York state court. The Port Authority removed the case to the United States District Court for the Southern District of New York. There, the Port Authority argued that the court lacked subject matter jurisdiction because the plaintiff had not satisfied a condition precedent for suit—specifically, timely delivery of the judgment of acquittal per the bylaws—meaning that the necessary waiver of sovereign immunity had not occurred. The district court agreed, dismissing the case for lack of subject matter jurisdiction and subsequently denying leave to amend the complaint as futile, finding that the plaintiff had failed to plead compliance with the condition precedent.The United States Court of Appeals for the Second Circuit reviewed the dismissal. It held that the Port Authority does not possess state sovereign immunity from suit in federal court, as established by the Supreme Court in Hess v. Port Authority Trans-Hudson Corp., and therefore a failure to plead waiver of sovereign immunity does not deprive the federal court of subject matter jurisdiction. The court vacated the district court’s judgment and remanded for further proceedings, overruling prior circuit precedent to the contrary. The court also vacated the denial of leave to amend, clarifying that compliance with contractual or statutory conditions is an affirmative defense, not a jurisdictional prerequisite. View "Baroni v. Port Authority of New York and New Jersey" on Justia Law

A man who was not a member of a grand jury petitioned the Superior Court in Anchorage, Alaska, seeking to present information to a grand jury about alleged deficiencies and patterns of conduct within the Office of Children’s Services. He did not request a criminal indictment, but instead asked that the grand jury investigate certain matters of public welfare and safety. The Superior Court held hearings to clarify what he sought, but before the process concluded, the Alaska Supreme Court amended Criminal Rule 6.1, establishing a procedure for private citizens to submit concerns to the grand jury through the Attorney General.Following this amendment, the Superior Court vacated further hearings and instructed the petitioner to submit his request to the Department of Law as required by Rule 6.1(c). The petitioner did so and also appealed the Superior Court’s dismissal, arguing that the Alaska Supreme Court lacked authority to enact Rule 6.1(c) and that it improperly limited the grand jury’s constitutional powers.The Supreme Court of the State of Alaska considered the appeal. Using independent judgment for constitutional interpretation and reviewing the dismissal as a grant of summary judgment de novo, the Court held that the Alaska Constitution gives it broad rule-making authority over judicial procedure, including grand jury matters. The Court found that Rule 6.1(c) does not impermissibly suspend the grand jury’s investigatory power, nor does the Constitution guarantee individuals direct access to the grand jury. The Court also rejected claims that the rule violated statutory or common law rights and found no procedural defects in the rule’s promulgation. Accordingly, the Alaska Supreme Court affirmed the Superior Court’s denial of the man’s petition to follow a different process. View "Garber v. Superior Court, Third Judicial District" on Justia Law

The case involves a woman who, as a minor, engaged in a sexual relationship with an adult more than twice her age. After the relationship ended, she experienced significant psychological distress, including anxiety and difficulty with personal relationships, and was later diagnosed with PTSD by a psychologist. Years after the relationship, she reported the events to the police, resulting in criminal charges against the adult, who was ultimately acquitted. Over a decade after the relationship ended, she brought civil claims for negligence per se, battery, and intentional infliction of emotional distress.The Circuit Court of Fairfax County sustained the defendant’s plea in bar, finding that the statute of limitations had run. The court determined that the version of the Virginia accrual statute in effect when the plaintiff reached the age of majority governed the action. The court found no legislative intent to apply later, more favorable statutes retroactively and ruled that the limitations period began when the plaintiff turned 18. The Court of Appeals of Virginia affirmed, concluding that the relevant accrual statute did not apply retroactively and that the plaintiff’s own complaint demonstrated awareness of her injuries and their connection to the relationship before reaching adulthood.On appeal, the Supreme Court of Virginia reviewed whether the lower courts erred in refusing to apply the more recent accrual statute retroactively and in finding that the plaintiff was aware of her injuries and their causal connection before the age of majority. The Supreme Court held that arguments for retroactive application of the statute were waived because they were not properly raised below, and that the record supported the finding that the plaintiff knew of her injury and its connection to the relationship as a minor. The Supreme Court of Virginia affirmed the judgment of the Court of Appeals, holding that the claims were time barred. View "Doe v. Green" on Justia Law

Michael Dixon and Kalie Dixon entered into a contract with Best Choice Roofing Alabama, LLC for the replacement of the roof on their home in Washington County, Alabama. After the work was completed, the Dixons noticed leaks and water damage, and despite contacting the company and providing an opportunity to fix the issues, their concerns were not resolved. They alleged that their house became nearly uninhabitable and sought damages for breach of contract and wantonness.Best Choice Roofing Alabama moved to dismiss the claims for improper venue, pointing to a forum-selection clause in the contract requiring any lawsuits to be brought in Sumner County, Tennessee, under Tennessee law. The Dixons argued that enforcing this clause would be seriously inconvenient and deprive them of their day in court, citing financial hardship, the distance to Tennessee, and the location of evidence and witnesses in Alabama. The Washington Circuit Court denied the motion to dismiss, finding the forum-selection clause clearly unreasonable and the chosen forum seriously inconvenient due to the circumstances faced by the Dixons, including their financial situation and the impact of the alleged damage.The Supreme Court of Alabama reviewed the trial court’s denial of the motion to dismiss through a petition for writ of mandamus. Applying Alabama law, the Supreme Court held that outbound forum-selection clauses are enforceable unless enforcement would be unfair or unreasonable. The Court found that the Dixons failed to meet their burden to show that enforcement would deprive them of their day in court or that extraordinary facts justified disregarding the clause. The Court concluded that the trial court exceeded its discretion and granted the petition, directing the trial court to dismiss the claims against Best Choice Roofing Alabama. View "Ex parte Best Choice Roofing Alabama, LLC" on Justia Law

The dispute centers on the ad valorem tax assessments for a low-income-housing property purchased in 2019 by Southampton 100, LLC. Dissatisfied with the Jefferson County Tax Assessor's valuations for several tax years, Southampton sought adjustments from the Jefferson County Board of Equalization and Adjustments. While the Board reduced some assessments, Southampton remained dissatisfied and filed separate appeals for each tax year. These appeals were consolidated in the Jefferson Circuit Court, where the Alabama Department of Revenue (ADOR) became the appellee.As the consolidated appeal progressed, the parties encountered repeated discovery disputes. ADOR filed multiple motions for sanctions, culminating in a request to depose Southampton’s second corporate representative, who resided in California, in person in Alabama. Southampton argued that requiring travel was unduly burdensome, offering instead to make this representative available via Zoom or for an in-person deposition immediately before trial. However, Southampton never sought a formal protective order. ADOR persisted and, after additional scheduling complications and denied motions, requested dismissal of the appeal as a sanction for alleged noncompliance. The Jefferson Circuit Court granted this request and dismissed Southampton’s appeal with prejudice, without a hearing or explanation.The Supreme Court of Alabama reviewed the case, applying the standard of whether the trial court exceeded its discretion in imposing sanctions. The Court held that dismissal with prejudice is a severe sanction that requires a showing of willful and deliberate disregard for discovery obligations. The record did not support a finding that Southampton acted willfully or intentionally to prevent discovery. Therefore, the Supreme Court of Alabama reversed the circuit court’s judgment and remanded the case for further proceedings. View "Southampton 100, LLC v. Alabama Department of Revenue" on Justia Law

A business dispute arose when an individual agreed to sell her furniture and design company to a limited liability company controlled by two individuals for $2.7 million, with payment to be made in installments. The seller also entered into a consulting agreement to assist in the transition but was terminated a few months later. The seller alleged that she did not receive compensation due under the consulting agreement and that the buyer failed to pay the final installment of the purchase price. She asserted claims for breach of contract, unjust enrichment, fraudulent inducement, and promissory fraud. The defendants counterclaimed and brought in several third parties, but most of those claims were eventually dismissed, leaving several claims—including for declaratory judgment, conversion, slander, breach of contract, and tortious interference—still pending.The Cullman Circuit Court tried only the seller’s promissory fraud and fraudulent inducement claims against the two individual defendants, entering judgment based on a jury verdict for the seller and awarding over $10 million in damages. The court stayed all claims against the corporate defendants after they filed for bankruptcy. Despite multiple claims and parties remaining, the circuit court certified its judgment against the individuals as final under Rule 54(b) of the Alabama Rules of Civil Procedure.Upon review, the Supreme Court of Alabama determined that the circuit court’s Rule 54(b) certification was improper. The Supreme Court found that closely intertwined and factually overlapping claims, counterclaims, and third-party claims remained unresolved, and that proceeding in piecemeal fashion risked inconsistent results and unnecessary duplication. The Supreme Court dismissed the appeal, holding that the circuit court’s order was not properly certified as final and thus was not appealable at this stage. View "Roberson v. Daniel" on Justia Law