Justia Civil Procedure Opinion Summaries

Lauren Woods was injured in a car accident involving an underinsured motorist and sought benefits from her insurer, Progressive American Insurance Company, under her policy’s underinsured motorist provision. Progressive declined to pay the full policy limit. Woods then sued Progressive for breach of contract and statutory bad faith under Florida law, alleging that Progressive failed to settle her claim in good faith. After serving civil remedy notices, Woods’s case was removed to federal court based on diversity jurisdiction.The United States District Court for the Southern District of Florida first held a jury trial on Woods’s underinsured motorist claim, resulting in a verdict and final judgment in her favor that exceeded the policy limit. Woods then proceeded with her statutory bad faith claim before the same court. Prior to the bad faith trial, the parties stipulated to certain facts, including the existence and amount of the prior verdict and judgment. They also agreed that the magistrate judge would determine damages, and the jury would decide only liability. At the start of the bad faith trial, Woods limited her theory to Progressive’s conduct before the underinsured motorist trial, and the court excluded evidence and instructions regarding the prior verdict and excess judgment. The jury found for Progressive on the bad faith claim, and the court denied Woods’s motion for a new trial.On appeal, the United States Court of Appeals for the Eleventh Circuit held that the district court did not abuse its discretion in excluding the prior verdict and excess judgment from the bad faith trial. The court found that, given Woods’s stipulation limiting the scope of her claim and the parties’ agreement that damages would be determined by the judge, the excluded evidence was irrelevant to the jury’s determination of liability. The Eleventh Circuit affirmed the district court’s judgment in favor of Progressive. View "Woods v. Progressive American Insurance Company" on Justia Law

A group of companies that are frequently sued in asbestos litigation brought an action against several settlement trusts and a claims processing facility. These trusts were established as part of bankruptcy reorganizations by former asbestos manufacturers to handle and pay out current and future asbestos-related claims. The plaintiffs rely on information held by these trusts—specifically, data about claimants’ other asbestos exposures—to defend themselves in ongoing and anticipated lawsuits. In January 2025, the trusts announced new document retention policies that would result in the destruction of most existing claims data after one year, which the plaintiffs argued would severely impair their ability to defend against asbestos claims and seek contribution or indemnification from the trusts.Previously, the trusts notified claimants of the impending data destruction, and the plaintiffs, upon learning of this, requested that the trusts not implement the new policies. When the trusts refused, the plaintiffs filed suit in the Court of Chancery of the State of Delaware, seeking a declaratory judgment that the trusts have a duty to preserve the claims data and a permanent injunction to prevent the destruction of this information. The trusts moved to dismiss, arguing that the court lacked subject matter jurisdiction, that the plaintiffs lacked standing, and that the complaint failed to state a claim.The Court of Chancery denied the motions to dismiss. It held that it had subject matter jurisdiction because the plaintiffs sought injunctive relief and because the case fit within the court’s traditional equitable powers, including the authority to grant a bill of discovery to preserve evidence for use in litigation. The court found that the plaintiffs had standing, as they faced a concrete and imminent injury from the threatened destruction of data essential to their defense and contribution claims. The court also held that the complaint stated a claim for relief, allowing the case to proceed beyond the pleading stage. View "DBMP LLC v. Delaware Claims Processing Facility, LLC" on Justia Law

Plaintiffs, C&M Resources, LLC and Winter Oil, LLC, acting on behalf of a putative class of royalty owners, alleged that Extraction Oil and Gas, Inc. underpaid royalties owed under oil and natural gas production agreements. This case is the third attempt by the plaintiffs to pursue these claims, all arising from the same set of facts. In the two prior lawsuits filed in Colorado state court, the trial courts dismissed the complaints for lack of subject matter jurisdiction, finding that the plaintiffs had failed to exhaust administrative remedies before the Colorado Oil and Gas Conservation Commission, as required by statute. The plaintiffs did not appeal those dismissals.In the present case, originally filed in state court in 2019, proceedings were stayed pending the Colorado Supreme Court’s decision in Antero Resources Corp. v. Airport Land Partners, Ltd. After the stay was lifted in 2023 and discovery commenced, Extraction determined that the amount in controversy exceeded $5 million and removed the case to federal court under the Class Action Fairness Act. The plaintiffs moved to remand, arguing that removal was untimely and that Extraction had waived its right to remove by participating in state court litigation. The United States District Court for the District of Colorado denied the remand motion, finding that the removal was timely based on information obtained during discovery and that the bankruptcy proof of claim and other documents from prior cases did not trigger the removal clock.The United States Court of Appeals for the Tenth Circuit reviewed the district court’s decisions. It held that the district court properly denied remand and correctly applied collateral estoppel, precluding the plaintiffs from relitigating the exhaustion requirement. The Tenth Circuit affirmed the district court’s judgment on the pleadings in favor of Extraction, finding no error in the lower court’s rulings. View "C&M Resources v. Extraction Oil and Gas" on Justia Law

A state agency, the Department of Family and Community Services (DFCS), leased office space from JBG Memorial (JBG) in Anchorage under a fifteen-year agreement set to expire in February 2023, with options to renew. As the lease neared expiration, DFCS applied for and received a waiver from the Department of Transportation and Public Facilities (DOT&PF) commissioner to procure new office space through a single source process, bypassing the usual competitive bidding. DFCS informed JBG that it would not renew the lease and would vacate, but did not provide details about the new lease. JBG requested public records but did not receive them before the lease expired. DFCS remained in the property on a month-to-month basis until it entered a new lease at Anchorage Business Park. JBG received the requested records only after the new lease was signed.JBG filed suit in the Superior Court of the State of Alaska, Third Judicial District, Anchorage, seeking to enjoin the termination of its lease, void the new lease, and require proper bid procedures. JBG also sought a preliminary injunction to prevent DFCS from vacating. The State moved to dismiss, arguing JBG had failed to exhaust administrative remedies. JBG admitted it had not done so but claimed exhaustion was excused due to lack of meaningful access, bias, futility, and irreparable harm. The superior court dismissed the complaint, finding JBG had not pled facts sufficient to excuse exhaustion, and awarded attorney’s fees to the State as the prevailing party.The Supreme Court of the State of Alaska reviewed the case de novo and affirmed the superior court’s dismissal. The court held that JBG was required to exhaust administrative remedies before seeking judicial review and failed to establish any valid excuse for not doing so. The court also affirmed the award of attorney’s fees to the State. View "JBG Memorial, LLC v. State of Alaska, Department of Transportation and Public Services" on Justia Law

David and Bonnie Faulk, residents of Alaska, purchased over one hundred windows from Spenard Builders Supply for their custom-built home and alleged that the windows, manufactured by JELD-WEN, were defective in breach of an oral warranty. They filed a class action in Alaska state court against Spenard Builders Supply, an Alaska corporation, and JELD-WEN, a Delaware corporation, asserting state-law claims. The defendants removed the case to federal court under the Class Action Fairness Act (CAFA), which allows federal jurisdiction based on minimal diversity in class actions.After removal, the Faulks amended their complaint to remove all class action allegations and sought to remand the case to state court. The United States District Court for the District of Alaska denied their motion to remand, relying on Ninth Circuit precedent that held federal jurisdiction under CAFA is determined at the time of removal and is not affected by post-removal amendments. The district court allowed the amendment to eliminate class allegations but ultimately dismissed the second amended complaint with prejudice, finding most claims time-barred and one insufficiently pled.On appeal, the United States Court of Appeals for the Ninth Circuit reviewed the impact of the Supreme Court’s decision in Royal Canin U.S.A., Inc. v. Wullschleger, which held that federal jurisdiction depends on the operative complaint, including post-removal amendments. The Ninth Circuit concluded that, after the Faulks removed their class action allegations, the sole basis for federal jurisdiction under CAFA was eliminated, and complete diversity was lacking. The court vacated the district court’s order dismissing the complaint and remanded with instructions to remand the case to state court unless another basis for federal jurisdiction is established. View "FAULK V. JELD-WEN, INC." on Justia Law

A cannabis cultivation business was licensed to operate in Vermont but became the subject of regulatory action after laboratory testing detected myclobutanil, a prohibited pesticide, in its products. The business had previously entered into a corrective action plan with the regulatory board following similar violations in 2023, agreeing to remediation, penalties, and compliance measures. In 2024, after further detections of myclobutanil in both retail and on-site samples, the regulatory board issued a notice of violation with immediate effect, including a stop-sale order for all of the business’s products, a recall requirement, and a proposed license revocation.The business contested the notice and requested a hearing before the Cannabis Control Board. At the hearing, it raised several arguments, including challenges to the Board’s authority under the Vermont Constitution, claims of bias by the Board chair, and alleged due process violations. The Board chair denied a motion for recusal, and after hearing testimony and reviewing evidence, the Board found that the business had violated its corrective action plan and used unauthorized pesticides. The Board dismissed one violation as duplicative but upheld others, ultimately revoking the business’s license. The business appealed to an appellate officer, who affirmed the Board’s decision.The Vermont Supreme Court reviewed the case, applying a standard that precludes reweighing factual findings unless clearly erroneous or affected by legal error. The Court held that the Board acted within its statutory authority in issuing a stop-sale order for all products, that the Board’s interpretation of its regulations was reasonable, and that the business failed to preserve or adequately brief its constitutional and evidentiary arguments. The Court also found no due process violation regarding the impartiality of the Board chair, as the business did not make an evidentiary record to support its claims. The Supreme Court affirmed the revocation of the business’s license. View "In re Holland Cannabis, LLC" on Justia Law

A Maryland real estate investment trust with over 12,000 shareholders entered into an advisory agreement with UMTH General Services, L.P. and its affiliates to manage the trust’s investments and operations. The agreement stated that the advisor was in a fiduciary relationship with the trust and its shareholders, but individual shareholders were not parties to the agreement. After allegations of mismanagement and improper advancement of legal fees surfaced, a shareholder, Nexpoint Diversified Real Estate Trust, sued derivatively in Maryland. The Maryland court dismissed the claims for lack of standing and subject matter jurisdiction. Nexpoint then transferred its shares to a subsidiary, which, along with Nexpoint, sued the advisors directly in Texas, alleging corporate waste and mismanagement, and claimed the advisory agreement created a duty to individual shareholders.In the 191st District Court of Dallas County, the advisors filed a plea to the jurisdiction, a verified plea in abatement, and special exceptions, arguing that the claims were derivative and belonged to the trust, so the shareholders lacked standing and capacity to sue directly. The trial court denied these motions. The advisors sought mandamus relief from the Fifth Court of Appeals, which was denied, and then petitioned the Supreme Court of Texas.The Supreme Court of Texas held that while the shareholders alleged a financial injury sufficient for constitutional standing, they lacked the capacity to sue individually because the advisory agreement did not create a duty to individual shareholders, nor did it confer third-party beneficiary status. The agreement benefited shareholders collectively through the trust, not individually. The court conditionally granted mandamus relief, directing the trial court to vacate its order and dismiss the case with prejudice, holding that shareholders must pursue such claims derivatively and in the proper forum as specified by the trust’s governing documents. View "IN RE UMTH GENERAL SERVICES, L.P." on Justia Law

Sanchez Energy Corporation, a gas producer, underwent Chapter 11 bankruptcy in 2019 due to significant debt, with its reorganization plan confirmed in April 2020. The company, later renamed Mesquite Energy, Inc., owned valuable fossil fuel reserves in the Comanche Field, Texas, and had several high-cost contracts for gathering, processing, transporting, and marketing natural gas and natural gas liquids. Carnero G&P, L.L.C., a midstream services provider, had a contract with Sanchez to serve as a backup provider. After Sanchez’s reorganization, Mesquite entered into new agreements with other parties to lower its midstream costs, which Carnero claimed breached its surviving contract.Following the bankruptcy, Carnero filed a state court lawsuit against Mesquite and other parties, asserting state law claims based on the new agreements. The suit was removed to the United States Bankruptcy Court for the Southern District of Texas, which denied Carnero’s request to remand and ultimately dismissed the case on the pleadings, finding it had “related-to” jurisdiction under 28 U.S.C. § 1334. The bankruptcy court reasoned that the dispute pertained to the implementation of the reorganization plan and that Carnero was barred from challenging the new agreements due to its failure to object during the bankruptcy proceedings. The United States District Court for the Southern District of Texas affirmed the bankruptcy court’s decision.On appeal, the United States Court of Appeals for the Fifth Circuit reviewed the jurisdictional question de novo. The Fifth Circuit held that the bankruptcy court lacked post-confirmation “related-to” jurisdiction over Carnero’s state law contract claims, as the dispute did not pertain to the implementation or execution of the reorganization plan. The court found that the new agreements were not executory contracts under the plan and that Carnero was not barred from pursuing its claims. The Fifth Circuit reversed the lower courts’ judgments and remanded the case with instructions to remand to state court. View "Carnero G&P v. SN EF Maverick" on Justia Law

RTI, LLC and RTI Holdings, LLC sought to construct a specialized clinical research facility in Brookings, South Dakota, designed for animal health research trials with stringent air filtration and ventilation requirements. Acting as the general contractor, RTI hired designArc Group, Inc. as architect and several contractors, including Pro Engineering, Inc., Ekern Home Equipment Company, FM Acoustical Tile, Inc., and Trane U.S. Inc., to design and build the facility. After completion in April 2016, RTI experienced significant issues with air pressure, ventilation, and ceiling integrity, leading to contamination problems that disrupted research and resulted in financial losses.The Circuit Court of the Third Judicial Circuit, Brookings County, reviewed RTI’s claims for breach of contract and breach of implied warranties against the architect and contractors. All defendants moved for summary judgment, arguing that RTI’s claims were based on professional negligence and required expert testimony, which RTI failed to provide. The circuit court agreed, finding RTI’s CEO unqualified as an expert, and granted summary judgment to all defendants. The court also denied RTI’s motion to amend its complaint to add negligence claims, deeming the amendment untimely and futile due to the lack of expert testimony.The Supreme Court of the State of South Dakota affirmed the summary judgment for designArc, Pro Engineering, and FM Acoustical, holding that expert testimony was required for claims involving specialized design and construction issues, and that RTI’s CEO was not qualified to provide such testimony. However, the court reversed the summary judgment for Trane and Ekern, finding genuine issues of material fact regarding Trane’s alleged faulty installation and Ekern’s potential vicarious liability. The court also reversed the denial of RTI’s motion to amend the complaint, concluding the proposed amendments were not futile and would not prejudice Trane or Ekern. The case was remanded for further proceedings. View "RTI, LLC v. Pro Engineering" on Justia Law

Jeremy and Abbey Coyle brought a civil trespass action against Kenneth and Kelli McFarland, alleging that a portion of the McFarlands’ driveway and vehicles encroached on the Coyles’ property, Lot Q1, in Belle Fourche, South Dakota. The dispute centered on whether a public right-of-way (Walworth Street) extended along the entire southeastern boundary of the McFarlands’ Lot 25A, which would affect the property boundaries and the alleged trespass. The Coyles claimed the right-of-way ended at a certain point, while the McFarlands argued it continued along the full boundary, relying on subdivision plats, improvement agreements, and city ordinances.After the Coyles filed their complaint, the McFarlands answered and asserted their defense based on the Subdivision Improvements Agreement and city records. The Coyles then moved for partial summary judgment before any discovery had occurred. The McFarlands failed to respond within the statutory deadline and subsequently moved for a continuance under SDCL 15-6-56(f), submitting affidavits explaining the need for additional discovery and citing personal circumstances for the delay. The Circuit Court for the Fourth Judicial Circuit, Butte County, denied the continuance and granted partial summary judgment to the Coyles, finding the right-of-way ended as the Coyles claimed and ordering the McFarlands to remove their assets from Lot Q1. The court later denied the McFarlands’ motion for reconsideration and motion for relief from judgment.On appeal, the Supreme Court of South Dakota held that the circuit court abused its discretion by denying the McFarlands’ motion for a continuance. The Supreme Court found that the McFarlands’ affidavits met the requirements for additional time under Rule 56(f), that excusable neglect was present due to counsel’s personal circumstances, and that no prejudice to the Coyles was shown. The Supreme Court reversed the circuit court’s orders and remanded for further proceedings. View "Coyle v. Mcfarland" on Justia Law