Justia Civil Procedure Opinion Summaries

Plaintiffs Anthony D’Armiento and Susan Scharpf filed a class action lawsuit against several major shipbuilders and naval-engineering consultancies, alleging a "no-poach" conspiracy to suppress wages by agreeing not to recruit each other’s employees. The plaintiffs, who had not worked for any defendant since 2013, claimed that this conspiracy was concealed through a "non-ink-to-paper" agreement, which they only discovered in April 2023 through an investigation.The United States District Court for the Eastern District of Virginia dismissed the case, ruling that it was barred by the Sherman Act’s four-year statute of limitations. The court found that the alleged "non-ink-to-paper" agreement did not constitute an affirmative act of fraudulent concealment that would toll the limitations period.The United States Court of Appeals for the Fourth Circuit reviewed the case and reversed the district court’s decision. The appellate court held that an agreement deliberately kept unwritten to avoid detection could qualify as an affirmative act of concealment. The court emphasized that fraudulent concealment can include acts of omission, such as avoiding the creation of written evidence. The court found that the plaintiffs had adequately alleged that the defendants engaged in affirmative acts of concealment by maintaining a secret, unwritten no-poach agreement.The Fourth Circuit concluded that the plaintiffs’ allegations met the relaxed Rule 9(b) standard for pleading fraudulent concealment with particularity. The court also determined that the plaintiffs had sufficiently alleged due diligence, as they were not on inquiry notice of the conspiracy until the investigation in 2023. The case was reversed and remanded for further proceedings. View "Scharpf v. General Dynamics Corporation" on Justia Law

In 2019, Navient Solutions, LLC, a student loan servicer, filed a civil action alleging that a group of lawyers, marketers, and debt-relief businesses conspired to defraud Navient out of millions of dollars in unpaid student debt. Navient claimed that the defendants lured student borrowers into filing sham lawsuits against Navient under the Telephone Consumer Protection Act (TCPA), which regulates abusive telemarketing practices. The case proceeded to trial, and a jury found in favor of Navient. However, the district court later granted the defendants' renewed motions for judgment as a matter of law, ruling that the TCPA suits were not sham litigation and setting aside the jury's verdicts.The United States District Court for the Eastern District of Virginia initially rejected the defendants' argument that their litigation activities were protected under the Noerr–Pennington doctrine, which safeguards the First Amendment right to petition the government. After the jury returned verdicts against each defendant, the district court vacated the verdicts, concluding that the TCPA litigation was not sham litigation and that Navient's damages were directly related to the TCPA litigation.The United States Court of Appeals for the Fourth Circuit reviewed the case and affirmed the district court's decision. The Fourth Circuit held that the TCPA actions were not sham litigation and were protected under the Noerr–Pennington doctrine. The court found that the defendants' actions were based on a legitimate question of statutory interpretation regarding the definition of an automatic telephone dialing system (ATDS) under the TCPA. The court also noted that Navient had conceded the merits of the TCPA cases and had only sought damages related to the litigation costs. As a result, the court concluded that the defendants' petitioning activity was protected by the First Amendment, and the district court's judgment as a matter of law was appropriate. View "Navient Solutions, LLC v. Lohman" on Justia Law

Honeywell International, a Delaware corporation, and OPTO Electronics, a Japanese company, are competitors in the barcode-scanning equipment market. In May 2019, Honeywell sued OPTO for patent infringement, alleging that OPTO's barcode products infringed on seven of Honeywell's patents. The parties settled in January 2020 with a patent-licensing agreement, allowing OPTO to use Honeywell's patents in exchange for royalty payments. In March 2021, Honeywell audited OPTO and claimed that OPTO had underreported its revenues, leading to a dispute over the definition of "2D Barcode Products." Honeywell then sued OPTO for breach of contract in September 2021, alleging unpaid royalties.The United States District Court for the Western District of North Carolina handled the case. A jury found that OPTO's laser-scanning barcode readers were "2D Barcode Products" but awarded Honeywell only $859,741. The district court also rejected OPTO's counterclaim of patent misuse, concluding that Honeywell had not engaged in such conduct. Both parties filed post-trial motions, which the district court denied. Honeywell sought attorney's fees, and OPTO moved to set aside the jury verdict, but both requests were denied.The United States Court of Appeals for the Fourth Circuit reviewed the case. The court determined that it could not reach the merits because the United States Court of Appeals for the Federal Circuit has exclusive appellate jurisdiction over the appeal due to the patent-related counterclaim asserted by OPTO. The Fourth Circuit dismissed the appeal, allowing the parallel appeal pending in the Federal Circuit to proceed. The main holding was that the Federal Circuit has exclusive jurisdiction over appeals involving patent claims and counterclaims, even if the primary dispute is over a contract. View "Honeywell International, Inc. v. OPTO Electronics Co., Ltd." on Justia Law

AdvanFort Company, a maritime security firm based in Virginia, deployed a vessel, the Seaman Guard Virginia, for anti-piracy services in the Red Sea. In October 2013, the vessel docked at the Jeddah Shipyard in Saudi Arabia for repairs by Zamil Offshore Services Company. During the repairs, a fire broke out, which AdvanFort attributed to Zamil's personnel. AdvanFort sued Zamil and the Saudi Ports Authority in a Saudi court in 2014, but the court dismissed AdvanFort's claims and awarded partial damages to Zamil on its countersuit. In 2022, Zamil moved the vessel to a storage yard, claiming it was at risk of sinking, and later informed AdvanFort that it would dispose of the vessel if not retrieved.AdvanFort filed a complaint in the Eastern District of Virginia in July 2023, alleging conversion, breach of bailment, negligence, and gross negligence against Zamil and the Ports Authority. Zamil moved to dismiss the complaint on the grounds of forum non conveniens and lack of personal jurisdiction, arguing that Saudi courts were a more appropriate forum. The Ports Authority did not appear, leading to a default entry against it.The United States District Court for the Eastern District of Virginia dismissed AdvanFort's complaint on the basis of forum non conveniens, finding that Saudi courts were available, adequate, and more convenient for the litigation. The court noted that the relevant events and evidence were located in Saudi Arabia and that the Saudi courts had jurisdiction over both defendants.The United States Court of Appeals for the Fourth Circuit affirmed the district court's dismissal. The appellate court held that the district court did not abuse its discretion in determining that Saudi Arabia was a more convenient forum and that the Saudi courts were both available and adequate for adjudicating AdvanFort's claims. The court also found no error in the district court's denial of limited discovery on forum non conveniens issues. View "AdvanFort Co. v. Zamil Offshore Services Co." on Justia Law

Justin Longworth, a federal inmate, alleged that he faced repeated sexual harassment and abuse by Sherry M. Beck, a correctional officer at the Federal Correctional Institution in Butner, North Carolina. Longworth claimed Beck engaged in daily aggressive sexual harassment and abuse, including forced oral sex, fondling, and groping. He did not immediately report Beck's conduct due to fear of retaliation. Other officials at the institution initially did nothing to stop or report Beck's abuse. Eventually, Beck was reported, fired, and Longworth was transferred to another facility, but Beck continued to harass him through letters.Longworth filed two separate lawsuits in the Eastern District of North Carolina. The first lawsuit was a Bivens action against the officials directly involved, alleging violations of his civil rights under the Fourth and Eighth Amendments. The district court dismissed the Bivens claims, finding that they presented new contexts and that special factors counseled hesitation in extending Bivens to this context. Longworth appealed the dismissal of his Bivens claims. The second lawsuit was an FTCA claim against the United States, alleging negligence by the officials. The district court dismissed the FTCA claim for lack of subject matter jurisdiction, finding that Beck was not acting within the scope of her employment during the alleged misconduct. Longworth did not appeal the FTCA judgment.The United States Court of Appeals for the Fourth Circuit reviewed the case and concluded that the district court's FTCA judgment precluded Longworth's Bivens appeal. The FTCA judgment bar provides that an FTCA judgment is a complete bar to any action by the claimant against the employee of the government whose act or omission gave rise to the claim. Since a judgment on the FTCA claim had been entered, Longworth could no longer pursue his Bivens action based on the same conduct. Consequently, the Fourth Circuit dismissed the appeal. View "Longworth v. Mansukhani" on Justia Law

Two former employees sued Zen Nails Studio LLC and its owners for violating the Fair Labor Standards Act (FLSA) and a similar Maryland state law. After a five-day bench trial, the plaintiffs won and were awarded approximately 60% of their requested damages. The plaintiffs then sought $343,189.85 in attorney’s fees, but the district court awarded them $167,115.49, which was less than half of what they requested. The plaintiffs appealed the district court’s decision regarding the hourly rates used to calculate the attorney’s fees.The United States District Court for the District of Maryland, at Greenbelt, initially reviewed the case. The district court set the hourly rates for the plaintiffs’ attorneys, paralegals, and paraprofessionals based on the local rules' guidelines, which it treated as presumptively reasonable. The court then calculated the hours reasonably worked and reduced the total by 35% due to the plaintiffs achieving a moderately successful outcome. The plaintiffs challenged the district court’s reliance on the local rules' guidelines for setting the hourly rates.The United States Court of Appeals for the Fourth Circuit reviewed the case. The appellate court held that the district court erred by treating the hourly rates in the local rules as presumptively correct and requiring special justification for higher rates. The Fourth Circuit emphasized that while fee matrices can be a useful starting point, they should not be treated as setting a baseline that requires special justification to deviate from. The appellate court vacated the fee award and remanded the case for further proceedings, instructing the district court to consider all relevant evidence to determine the prevailing market rates without giving undue weight to the local rules' guidelines. View "De Paredes v. Zen Nails Studio LLC" on Justia Law

NCO Financial Systems, Inc. (NCO) entered into a lease agreement with Montgomery Park, LLC (Montgomery Park) for over 100,000 square feet of office space in Baltimore, Maryland. The lease allowed NCO to terminate early after eight years if certain conditions were met. NCO attempted to terminate early, but Montgomery Park claimed the conditions were not satisfied. NCO vacated the premises and stopped paying rent, leading Montgomery Park to send a default notice. NCO then filed a lawsuit seeking a declaratory judgment that it had properly terminated the lease and that the rent was based on misrepresented square footage.The United States District Court for the District of Maryland found in favor of Montgomery Park after a bench trial, awarding it $9,854,566.95 plus ongoing interest. The court also set a schedule for determining Montgomery Park’s claim for costs, fees, and expenses. Montgomery Park filed a motion seeking approximately $3.8 million for these costs, which NCO opposed on several grounds, including the lack of a proper demand for payment and the inclusion of fees for defending against NCO’s initial suit.The United States Court of Appeals for the Fourth Circuit reviewed the case. The court concluded that Montgomery Park made a valid demand for payment when it filed its motion for costs, fees, and expenses on August 24, 2022. The court held that default interest should run only from the date of this demand, not from when the costs were incurred, and remanded the case to recalculate the interest. The court affirmed the district court’s award of costs, fees, and expenses, including those incurred in defending against NCO’s claims and expert witness fees, finding no abuse of discretion or error in the district court’s decisions.The Fourth Circuit affirmed in part, vacated in part, and remanded with instructions to recalculate the default interest. View "NCO Financial Systems, Inc. v. Montgomery Park, LLC" on Justia Law

In September 2020, inmate Garfield Holley, proceeding pro se, sued several officers at Wallens Ridge State Prison under Section 1983. Holley alleged that the officers transported him to a dental appointment in a dog cage and subjected him to subsequent mistreatment. He claimed that this treatment was in retaliation for filing a grievance about a delayed medical procedure. Holley, who has asthma, described being chained in a padlocked dog cage in near-freezing temperatures for over six hours, leading to pneumonia and delayed medical care. He also alleged a pattern of retaliatory treatment against prisoners who complained about their conditions.The United States District Court for the Western District of Virginia dismissed Holley's complaint without prejudice for failing to pay the filing fee, citing the three-strikes rule under the Prison Litigation Reform Act. The court found that Holley had not adequately alleged imminent danger of serious physical injury, as the incidents described occurred approximately two years before the complaint was filed. Holley's motion for reconsideration was denied, and he timely appealed.The United States Court of Appeals for the Fourth Circuit reviewed the case de novo. The court concluded that Holley had adequately pleaded imminent danger of serious physical injury, noting the specificity of his allegations and the ongoing pattern of retaliatory treatment against prisoners at Wallens Ridge State Prison. The court found that Holley's allegations were sufficient to meet the imminent-danger exception to the three-strikes rule. Consequently, the Fourth Circuit reversed the district court's decision and remanded the case for further proceedings. View "Holley v. Combs" on Justia Law

Brooke N. Somers, a resident of Cecil County, Maryland, attended a Board of Education meeting on February 9, 2022, without wearing a mask, contrary to Maryland state emergency regulations. Officer Anthony Devine and John Roush informed her she could not enter without a mask. Somers claimed a medical exemption but was directed to sit in the lobby and watch the meeting via livestream. After causing a disturbance in the lobby and refusing to lower her volume or leave when ordered, Somers was arrested by Officer Devine. She resisted arrest, leading to a minor scuffle. Somers was charged with several offenses, convicted on two counts, but later acquitted on appeal.Somers filed a complaint in the United States District Court for the District of Maryland against multiple defendants, including Officer Devine. The district court dismissed claims against all defendants except Devine, granting him summary judgment on the basis of qualified immunity for all federal-law claims, including retaliatory arrest, unlawful arrest, excessive force, and malicious prosecution.The United States Court of Appeals for the Fourth Circuit reviewed the case. The court held that an objectively reasonable officer could have found probable cause for Somers' arrest, thus entitling Officer Devine to qualified immunity on the retaliatory arrest, unlawful arrest, and malicious prosecution claims. The court also found that the force used by Officer Devine was minimal and reasonable given Somers' resistance, granting him qualified immunity on the excessive-force claims. Consequently, the Fourth Circuit affirmed the district court's judgment. View "Somers v. Devine" on Justia Law

In late 2008, the IRS assessed Arthur and Gigi Stover a significant tax bill, which they could not pay. The Government waited until 2020 to initiate a collection suit, nearly twelve years later. Generally, the Government has ten years to sue for unpaid taxes, but this period can be extended if the taxpayer requests an installment agreement. The IRS records indicated that the Stovers requested such an agreement on December 12, 2008. However, Arthur Stover testified that they did not contact the IRS about a payment plan until 2009 through their CPA.The United States District Court for the Western District of North Carolina granted summary judgment to the Government, finding no genuine issue of material fact regarding the date of the installment agreement request. The court held that the request tolled the statute of limitations, making the Government's collection action timely.The United States Court of Appeals for the Fourth Circuit reviewed the case and found that there was a genuine dispute of material fact regarding the date of the installment agreement request. Arthur Stover's deposition testimony suggested that the request could not have been made until 2009, contradicting the IRS records. The court concluded that summary judgment was improper because the conflicting evidence created a genuine issue of fact that should be resolved by a factfinder.The Fourth Circuit vacated the district court's grant of summary judgment and remanded the case for further proceedings. The main holding was that summary judgment is not appropriate when there is a genuine dispute of material fact regarding the date that dictates the timeliness of the Government's suit. View "United States v. Stover" on Justia Law