Justia Civil Procedure Opinion Summaries

A group of drivers sued their employer, Owl, Inc., for breach of contract and violations of the Fair Labor Standards Act (FLSA). They claimed they were not paid the correct hourly rate under their employment contract or overtime wages under the FLSA. The district court granted summary judgment for Owl on the breach of contract claim and limited the damages available to the drivers for the FLSA claim. The parties then settled the FLSA claim for $350,000, and the drivers appealed the district court’s rulings.The district court for the Middle District of Florida granted summary judgment on the breach of contract claim, reasoning that the drivers had agreed to a specific hourly rate, and enforcing a higher rate under the Service Contract Act (SCA) would create a private right of action under the SCA, which does not exist. The court also granted Owl’s motion in limine, limiting the FLSA damages to one-and-a-half times the rate the drivers were actually paid. The drivers settled the FLSA claim but reserved the right to appeal the district court’s rulings.The United States Court of Appeals for the Eleventh Circuit reviewed the case. It held that it had jurisdiction under 28 U.S.C. § 1291 because the district court entered a final judgment on all claims. The court also held that the drivers had standing to challenge the district court’s rulings despite the settlement. On the merits, the Eleventh Circuit affirmed the district court’s summary judgment on the breach of contract claim, holding that the SCA wage was not incorporated into the employment contracts. However, it reversed the district court’s ruling on the FLSA claim, holding that the “regular rate” under the FLSA should include the prevailing wage required by the SCA. The case was remanded for further proceedings consistent with this opinion. View "Perez v. Owl, Inc." on Justia Law

Daniel Graff purchased a life insurance policy from Brighthouse Life Insurance Company for his father, with Graff as the beneficiary. Over the years, Graff paid more in premiums than the policy's death benefit. He sued Brighthouse, claiming the policy violated Minnesota's Readability of Insurance Policies Act (RIPA) and the implied covenant of good faith and fair dealing, and also sought recovery for unjust enrichment. Brighthouse removed the case to federal court, which dismissed Graff's claims for failing to state a claim.The United States District Court for the District of Minnesota dismissed Graff's complaint with prejudice. The court found that the RIPA did not provide a private cause of action, the implied-covenant claim was untimely, and Graff could not recover under unjust enrichment because a valid contract governed the parties' relationship.The United States Court of Appeals for the Eighth Circuit reviewed the case and affirmed the district court's dismissal. The appellate court held that the RIPA does not create a private cause of action, as enforcement authority is vested exclusively in the Minnesota Commissioner of Commerce. The court also determined that Graff's implied-covenant claim could not proceed because it was based on a statute that does not provide a private remedy. Lastly, the court upheld the dismissal of the unjust enrichment claim, noting that equitable remedies are unavailable when a valid contract governs the parties' rights, and Brighthouse was entitled to the premiums under the policy. View "Daniel Graff v. Brighthouse Life Ins. Co." on Justia Law

Thompson Corrugated Systems, Inc. (TCS) entered into an oral agreement in 2004 to act as the North American sales representative for Engico, S.r.l., an Italian manufacturer of corrugated box machinery. TCS was to receive an 8% commission on sales, later modified to a sliding scale in 2012. Despite low sales, TCS procured two significant sales for Engico in 2005 and 2017. In 2016, Engico attempted to terminate the agreement due to low sales, but TCS resisted, citing market conditions. The parties renegotiated in 2018, agreeing that TCS would remain the representative until 2021 and continue to receive commissions. However, disputes arose over commissions for sales made in 2019 and 2020, leading TCS to sue Engico for breach of contract and other state law claims.The United States District Court for the Southern District of Illinois granted partial summary judgment in favor of TCS, finding the 2004 oral agreement valid and enforceable. The court determined that the essential terms of the agreement, including the commission structure, territory, and services, were sufficiently definite. The court also found that the agreement was terminable at will under Illinois law. The remaining claims were left to the jury, which found Engico liable for breach of contract and awarded TCS damages.The United States Court of Appeals for the Seventh Circuit reviewed the district court’s grant of partial summary judgment de novo. The appellate court affirmed the district court’s decision, agreeing that the 2004 oral agreement contained sufficiently definite terms and that the Statute of Frauds did not bar enforcement of the 2018 agreement. The court concluded that the essential terms of the agreement were clear and that the deposition testimony satisfied the Statute of Frauds’ writing requirement. Thus, the judgment of the district court was affirmed. View "Thompson Corrugated Systems, Inc. v. Engico S.r.l." on Justia Law

Balboa Capital Corporation, a financing company, entered into agreements with various physicians across multiple states to finance their participation in a telehealth program run by America’s Medical Home Team (MHT). MHT, however, was operating a Ponzi scheme and failed to deliver the promised services and equipment. Balboa financed the physicians' participation by paying MHT directly and then sought repayment from the physicians through monthly payment agreements (MPAs) or installment payment agreements (IPAs). The physicians, unaware of the full terms and believing they could withdraw without financial obligations, defaulted on their payments after MHT's collapse.The United States District Court for the Northern District of Texas consolidated multiple collection actions filed by Balboa against the physicians. The court struck an evidentiary exhibit that combined the payment agreements with invoices, ruling that the invoices were not properly authenticated and constituted impermissible hearsay. The court then granted summary judgment in favor of the physicians, finding that the payment agreements alone did not constitute valid contracts as they lacked essential terms such as the total amount financed and the cost of financing.The United States Court of Appeals for the Fifth Circuit reviewed the district court’s rulings. The appellate court affirmed the decision to strike the exhibit, agreeing that the invoices were not properly authenticated and did not meet the business records exception to the hearsay rule. The court also affirmed the summary judgment, holding that the payment agreements, even if considered together with the invoices, did not form enforceable contracts under California law due to the absence of material terms. Consequently, Balboa’s claims for breach of contract and breach of guarantee failed as a matter of law. View "Balboa Capital v. Okoji Home Visits MHT, L.L.C." on Justia Law

The North Central Montana Regional Water Authority (the Authority) was created in 2000 through an interlocal agreement among several municipalities and county water and sewer districts. The Town of Kevin, a small municipality with fewer than 175 residents, did not sign the original agreement but signed several later documents attempting to join the Authority. The Town later sought to sever ties with the Authority, which resisted these attempts. On May 29, 2020, the Town sued the Authority, seeking a declaratory judgment under the Uniform Declaratory Judgment Act (UDJA) that it was not, and never had been, a member of the Authority, and also sought attorney fees.The Twelfth Judicial District Court held a bench trial and issued an order on November 10, 2022, declaring that the Town was not a member of the Authority and granting other relief. Subsequently, the Town filed a motion for attorney fees under the UDJA. On March 30, 2023, the District Court found that equitable factors supported awarding attorney fees to the Town, noting the significant disparity in resources between the Town and the Authority. The Authority appealed this order.The Supreme Court of the State of Montana reviewed the case. The court affirmed the District Court's decision, holding that the UDJA provides a legal basis for awarding attorney fees between governmental entities when appropriate. The court found that the parties were not similarly situated, as the Town had significantly fewer resources compared to the Authority. The court also applied the "tangible parameters test" and concluded that the Authority possessed what the Town sought, it was necessary for the Town to seek a declaration, and the declaratory relief was necessary to change the status quo. Therefore, the District Court did not abuse its discretion in awarding attorney fees to the Town. The Supreme Court affirmed the award of attorney fees to the Town. View "Town of Kevin v. North Central Montana Regional Water Authority" on Justia Law

RCBA Nutraceuticals, LLC, a Florida-based nutritional supplements company, contracted with Western Packaging, Inc. for the manufacture of plastic zipper pouches to hold its protein powder. These pouches were produced by PolyFirst Packaging, Inc. in Wisconsin, which was later acquired by ProAmpac Holdings, Inc. The pouches were shipped to companies in New York and Texas for filling. RCBA discovered that the pouches were defective, with seams splitting and spilling the protein powder, leading to a lawsuit against ProAmpac in federal court in Wisconsin. RCBA's claims included breach of contract, breach of implied warranties, negligence, civil conspiracy, and fraudulent misrepresentation.The United States District Court for the Eastern District of Wisconsin dismissed RCBA’s complaint. The court found that the claims were "foreign" under Wisconsin’s borrowing statute, WIS. STAT. § 893.07, and applied the statutes of limitations from New York and Texas for the contract claims, and Florida for the negligence claim. The court concluded that the contract claims were time-barred under the four-year statutes of limitations of New York and Texas, and the negligence claim was time-barred under Florida’s statute of limitations. The remaining tort claims were precluded by the economic loss doctrine. RCBA’s motion to reconsider was denied, with the court ruling that RCBA had waived its equitable arguments by not raising them earlier.The United States Court of Appeals for the Seventh Circuit affirmed the district court’s dismissal. The appellate court agreed that the final significant event for the contract claims occurred where the defective pouches were delivered, in New York and Texas, making the claims foreign and subject to those states' statutes of limitations. The court also upheld the district court’s decision to deny the motion to reconsider, noting that RCBA had waived its equitable arguments by not presenting them in response to the motion to dismiss. The court concluded that RCBA’s claims were either time-barred or precluded. View "RCBA Nutraceuticals, LLC v. ProAmpac Holdings, Inc." on Justia Law

Windward Bora LLC purchased a junior promissory note signed by Constance and Royston Browne, secured by a junior mortgage on real property. Windward's predecessor had already obtained a final judgment of foreclosure on the junior mortgage. Without seeking leave from the court that issued the foreclosure, Windward filed a diversity action to recover on the promissory note. Both parties moved for summary judgment.The United States District Court for the Southern District of New York granted the Brownes' motion for summary judgment and denied Windward's. The court found diversity jurisdiction by comparing the national citizenship of the Brownes with that of Windward’s sole member, a U.S. lawful permanent resident, and concluded that state domiciles were irrelevant. It also held that the suit was precluded by New York’s election-of-remedies statute because Windward did not seek leave before suing on the note after its predecessor had already sued on the mortgage. The court found no special circumstances to excuse Windward’s failure.The United States Court of Appeals for the Second Circuit reviewed the case. It agreed with the district court that diversity jurisdiction was present but clarified that the state domiciles of the parties were relevant. The court resolved a divide among district courts, stating that there is no diversity jurisdiction in a suit between U.S. citizens and unincorporated associations with lawful permanent resident members if such jurisdiction would not exist in a suit between the same U.S. citizens and those permanent resident members as individuals. The court also affirmed the district court’s decision to grant summary judgment for the Brownes under New York’s election-of-remedies statute, finding no special circumstances to excuse Windward’s failure to seek leave. The judgment of the district court was affirmed. View "Bora v. Browne" on Justia Law

The case involves a dispute between the law firm Abraham Watkins Nichols Agosto Aziz & Stogner and its former associate, Edward Festeryga. Abraham Watkins terminated Festeryga’s employment after discovering that he attempted to take clients and firm files to a new firm. Abraham Watkins sued Festeryga in Texas state court for conversion, breach of fiduciary duty, and tortious interference with contract. Festeryga moved to dismiss the suit under Texas’s anti-SLAPP statute, the Texas Citizens Participation Act (TCPA), which stayed the expedited discovery sought by Abraham Watkins. Despite agreeing to produce certain documents, Festeryga filed a notice of removal to federal court, claiming diversity jurisdiction as a Canadian citizen.The United States District Court for the Southern District of Texas remanded the case back to state court. The district court did not address whether Festeryga had shown diversity of citizenship but concluded that Festeryga waived his right to remove by participating in state court proceedings, specifically by filing a TCPA motion to dismiss. The district court found that this action demonstrated an intent to invoke the jurisdiction of the state court.The United States Court of Appeals for the Fifth Circuit reviewed the case to determine if it had appellate jurisdiction over the remand order. The court concluded that it did not have jurisdiction, citing its precedent in In re Weaver, which held that waiver-based remand orders are jurisdictional under 28 U.S.C. § 1447(c) and thus unappealable under § 1447(d). The court noted that although it disagreed with the reasoning in Weaver, it was bound by the rule of orderliness to follow the precedent. Consequently, the Fifth Circuit dismissed the appeal for lack of appellate jurisdiction. View "Abraham Watkins Nichols Agosto Aziz & Stogner v. Festeryga" on Justia Law

The case involves a qui tam action under the False Claims Act (FCA) brought by Relators against Great American Insurance Company (GAIC) and Native American Services Corporation (NASCO). The Relators allege that GAIC and NASCO fraudulently took control of DWG & Associates, Inc. (DWG), a company that had graduated from the Small Business Administration's (SBA) 8(a) program but was still performing on 8(a) contracts. The 8(a) program is designed to help small, disadvantaged businesses compete for federal contracts. DWG, initially owned and controlled by a disadvantaged individual, Gose, lost its eligibility when GAIC and NASCO allegedly took over its ownership and control without notifying the SBA or seeking a waiver, as required by the program's regulations.The United States District Court for the Middle District of Florida dismissed the Relators' claims with prejudice. The court found that DWG, having graduated from the 8(a) program, was no longer a "participant" and thus not subject to the program's ownership and control requirements. Consequently, the court ruled that Relators failed to allege any false claims. Additionally, the court held that fraudulent inducement related to bidding on government contracts was not actionable under the FCA and that Relators failed to meet the particularity requirements of Rule 9(b) for pleading fraud.The United States Court of Appeals for the Eleventh Circuit reversed the District Court's decision. The appellate court held that a business that has graduated from the 8(a) program but is still performing on 8(a) contracts remains a "participant" and is subject to the program's ownership and control requirements. The court further held that submitting bids and claims for payment under these circumstances without notifying the SBA or obtaining a waiver could constitute an actionable claim under the FCA. The court also found that Relators' complaint met the particularity requirements of Rule 9(b) by providing sufficient details about the alleged fraudulent conduct, including the specific contracts, task orders, and the date DWG became ineligible to bid. The case was remanded for further proceedings consistent with the appellate court's opinion. View "Berry v. Native American Services Corporation" on Justia Law

In 2006, David and Jill Landrum, along with Michael and Marna Sharpe, purchased land in Madison County to develop a mixed-use project called the Town of Livingston. The project stalled due to the 2008 financial crisis and legal issues. In 2010, Jill and Marna formed Livingston Holdings, LLC, which owned the development properties. Marna contributed more financially than Jill, leading to a disparity in ownership interests. In 2014, Marna sold her interest to B&S Mississippi Holdings, LLC, managed by Michael Bollenbacher. Jill stopped making her required monthly contributions in December 2018.The Madison County Chancery Court disqualified Jill as a derivative plaintiff, realigned Livingston Holdings as a defendant, and dismissed several claims. The court found that Jill did not fairly and adequately represent the interests of the company due to personal interests and economic antagonisms. The court also granted summary judgment in favor of several defendants and denied the Landrums' remaining claims after a bench trial.The Supreme Court of Mississippi reviewed the case and affirmed the lower court's decision to disqualify Jill as a derivative plaintiff and exclude the Landrums' expert witness. The court found that Jill's personal interests and actions, such as failing to make required contributions and attempting to gain control of the company, justified her disqualification. The court also affirmed the dismissal of claims for negligent omission, misstatement of material facts, civil conspiracy, fraud, and fraudulent concealment due to the Landrums' failure to cite legal authority.However, the Supreme Court reversed and remanded the case on the issues of remedies and attorneys' fees under the Second Memorandum of Understanding (MOU) and the alleged breach of fiduciary duty between B&S and Jill. The court found that the chancellor erred in interpreting the Second MOU as providing an exclusive remedy and remanded for further proceedings to determine if Livingston is entitled to additional remedies and attorneys' fees. The court also remanded for factual findings on whether B&S breached its fiduciary duty to Jill regarding property distribution and tax loss allocation. View "Landrum v. Livingston Holdings, LLC" on Justia Law