Justia Civil Procedure Opinion Summaries

A purported class action alleged that Beachwood Hair Clinic violated the Telephone Consumer Protection Act (TCPA), 47 U.S.C. 227, by disseminating more than 37,000 unsolicited fax advertisements in 2005 and 2006. Facing more than $18 million in statutory damages, Beachwood and its insurer, Acuity, agreed to a $4-million class settlement with the Ohio-based class representative, Siding. The settlement stipulated that separate litigation between Acuity and Siding would resolve a $2-million coverage dispute under Beachwood’s policy. Siding sought a declaratory judgment under Beachwood’s policy. The district court granted summary judgment to Acuity denying coverage. The Sixth Circuit vacated, finding that Siding did not establish diversity jurisdiction, which requires an amount in controversy greater than $75,000, 28 U.S.C. 1332(a). Unable to identify a singular interest exceeding $75,000 in the remaining $2-million coverage dispute, Siding sought to aggregate its interest with putative class members to satisfy that requirement, or to have the court consider the value of the policy dispute from Acuity’s perspective: $2 million. Acuity suggested ancillary jurisdiction via the settlement judgment in the underlying class action. The court rejected all arguments. View "Siding & Insulation Co. v. Acuity Mut. Ins. Co." on Justia Law

Plaintiffs filed a class action suit against Coverall, a janitorial franchising company, alleging that Coverall misclassified its California franchises as independent contractors and that Coverall breached its franchise agreements. After the parties settled, a sole objector filed an objection to the proposed settlement. The court concluded that the objector presented no evidence that the district court abused its discretion in declining further adjustment from the lodestar amount; the district court acted within its proper discretion when it found that the settlement contained significant benefits for plaintiffs beyond the cash recovery, and that the award, at about the third of the lodestar amount, was reasonable; the district court did not abuse its discretion in determining that the Churchill Vill., L.L.C. v. Gen. Elec. factors supported the conclusion that the settlement was fair, reasonable, and adequate; the district court has no obligation to make explicit monetary valuations of injunctive remedies; the district court did not abuse its discretion in approving the settlement term that objectors be available for depositions; and the district court did not abuse its discretion when it approved the settlement agreement consistent with the Class Action Fairness Act (CAFA), 28 U.S.C. 1715(b), notice requirement. Accordingly, the court affirmed the district court's approval of the proposed class action settlement under Rule 23 and the award of attorneys' fees to the attorneys of the proposed class. View "Laguna v. Coverall North America" on Justia Law

The flea-and-tick “spot-on products” at issue claim that their active ingredient works by topical application to a pet’s skin rather than through the pet’s bloodstream. According to the manufacturers, after the product is applied to one area, it disperses over the rest of the pet’s body within one day because it collects in the oil glands and natural oils spread the product over the surface of the pet’s skin and “wick” the product over the hair. The plaintiffs alleged false advertising based on statements that the products are self-dispersing and cover the entire surface of the pet’s body when applied in a single spot; that they are effective for one month and require monthly applications to continue to work; that they do not enter the bloodstream; and that they are waterproof and effective after shampooing, swimming, and exposure to rain or sunlight. The district court repeatedly referred to a one-issue case: whether the product covers the pet’s entire body with a single application. The case management order stated that the manufacturers would bear the initial burden to produce studies that substantiated their claims; the plaintiffs would then have to refute the studies, “or these cases will be dismissed.” The manufacturers objected. The plaintiffs argued that the plan would save time, effort, and money. The manufacturers submitted studies. The plaintiffs’ response included information provided by one plaintiff and his adolescent son and an independent examination of whether translocation occurred that detected the product’s active ingredient in a dog’s bloodstream. The district court concluded that the manufacturers’ studies substantiated their claims and denied all of plaintiffs’ discovery requests, except a request for consumer complaints, then granted the manufacturers summary judgment. The Sixth Circuit affirmed. The doctrines of waiver and invited error precluded challenges to the case management plan. View "Simms v. Bayer Healthcare, LLC" on Justia Law

Bridgeview Health Care Center filed a class action complaint against Clark, an Illinois resident who operates Affordable Digital Hearing, a sole proprietorship out of Terre Haute, Indiana. Bridgeview alleged that Clark sent Bridgeview and others unsolicited faxes and claimed violation of the Telephone Consumer Protection Act of 1991, 47 U.S.C. 227; common law conversion of its fax paper and toner; and violation of the Consumer Fraud and Deceptive Business Practices Act, 815 ILCS 505/2. Clark had a comprehensive general liability policy issued by State Farm, an Illinois corporation. The policy was purchased through an Indiana agent and issued to Clark’s Indiana business address. State Farm sought declaratory judgment that it had no duty to defend in Indiana state court. The action was dismissed for lack of personal jurisdiction over Bridgeview. Bridgeview sought a declaration, in Illinois state court that State Farm had a duty to defend and indemnify Clark under the advertising injury and property damage provisions of the policy. State Farm argued that Illinois law conflicts with Indiana law on coverage issues and that Indiana law should apply. The circuit court found that there was no conflict and no need to conduct a choice-of-law analysis. The appellate court reversed, finding that decisions cited by State Farm were sufficient to raise the possibility of a conflict, requiring a choice-of-law analysis The Illinois Supreme Court reversed, finding that State Farm failed to meet its burden of demonstrating that an actual conflict exists between Illinois and Indiana law.View "Bridgeview Health Care Ctr., Ltd. v. State Farm Fire & Cas. Co." on Justia Law

Plaintiffs filed a putative class action against MERS in state court asserting claims related to MERS's facilitation of the provision of "Esign" mortgages to consumer-borrowers. MERS appealed the district court's grant of a motion to remand to New York state court on the ground that MERS's notice of removal was untimely. The court reversed and held that, in Class Action Fairness Act (CAFA) cases, the 30-day removal periods of 28 U.S.C. 1446(b)(1) and (b)(3) are not triggered until the plaintiff serves the defendant with an initial pleading or other paper that explicitly specifies the amount of monetary damages sought or sets forth facts from which an amount in controversy in excess of $5,000,000 can be ascertained. The court also held that where a plaintiff's papers failed to trigger the removal clocks of sections 1446(b)(1) and (b)(3), a defendant may remove a case when, upon its own independent investigation, it determines that the case is removable. Therefore, the 30-day removal periods of sections 1446(b)(1) and (b)(3) are not the exclusive authorizations for removal in CAFA cases. In this instance, plaintiffs never served MERS with a complaint or subsequent document explicitly stating the amount in controversy or providing MERS with sufficient information to conclude the threshold amount in controversy was satisfied. Therefore, the removal clocks of section 1446(b)(1) and (b)(3) did not commence. After MERS determined upon its independent investigation that section 1332(d) conveyed CAFA federal jurisdiction because the amount in controversy, number of plaintiffs, and minimal diversity requirements were satisfied, it properly removed the case by alleging facts adequate to establish the amount in controversy in its notice of removal. Accordingly, the court vacated and remanded. View "Cutrone v. Mortgage Electronic Registration Systems, Inc." on Justia Law

A class action complaint, filed in state court, alleged that Pushpin acted as an unlicensed debt collector in violation of the Illinois Consumer Fraud Act and filed 1100 Illinois small‐claims suits, all fraudulent, but that the class (defendants in those suits) sought “no more than $1,100,000.00 in compensatory damages and $2,000,000.00 in punitive damages,” and would ‘incur attorneys’ fees of no more than $400,000.00,” below the $5 million threshold for removal of a state‐court class action to a federal district court under the Class Action Fairness Act. Pushpin removed the case to federal court under the Act, 28 U.S.C. 1453(b), but the district court remanded to state court. The Seventh Circuit reversed, reasoning that the plaintiff did not irrevocably commit to obtaining less than $5 million for the class, and Pushpin’s estimate that the damages recoverable by the class could equal or exceed that amount may be reliable enough to preclude remanding the case to the state court. The lower court’s reasoning that most of the claims were barred by the Rooker‐Feldman rule was a mistake as was a statement that “there is a strong presumption in favor of remand” when a case has been removed under the Class Action Fairness Act. View "Pushpin Holdings, LLC v. Johnson" on Justia Law

Plaintiff was an original member of the class of plaintiffs in Betty Dukes, et al. v. Wal-Mart Stores, Inc. After the Supreme Court decertified the Dukes class, plaintiff filed this putative class action in the Texas district court. That court dismissed plaintiff's individual claims because they had ceased to be tolled and were therefore time-barred. The court reversed and remanded, holding that, under Am. Pipe & Constr. Co. v. Utah and its progeny, the relevant statute of limitations remained tolled when plaintiff filed her complaint in this case. View "Odle v. Wal-Mart Stores, Inc." on Justia Law

A business that manages commercial real estate and its owners were sued in a purported class action under the Telephone Consumer Protection Act, 47 U.S.C. 227, for having paid a “fax blaster” (Business to Business Solutions) to send unsolicited fax advertisements. Aggregate statutory damages would be more than $5 million or, if the violation is determined to be willful or knowing, as much as three times greater. The Seventh Circuit denied leave to appeal class certification in the suit, which is more than five years old. The court noted that it had no knowledge of the value of the defendant-business and that, even if the defendants could prove that they will be forced to settle unless class certification is reversed, they would have to demonstrate a significant probability that the order was erroneous. Rejecting challenges concerning individual class members, the court noted that no monetary loss or injury need be shown to entitle junk‐fax recipient to statutory damages. The adequacy of the class representative was not challenged. View "Wagener Equities, Inc. v. Chapman" on Justia Law