Justia Civil Procedure Opinion Summaries

Plaintiffs filed a class action against ARS, a debt collection agency, under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692 et seq. The class consists of some four million people nationwide. At issue is whether the magistrate judge had the authority to exercise jurisdiction to approve the class action settlement without obtaining the consent of all four million class members. If so, at issue is whether the magistrate judge abused her discretion by approving the settlement as fair, reasonable, and adequate. The court concluded that the magistrate judge had the authority to enter final judgment pursuant to 28 U.S.C. 636(c); the court joined three of its sister circuits and concluded that the statute requires the consent of the named plaintiffs alone, not the consent of the four million class members not present before the district court; and section 636(c) does not violate Article III of the Constitution by permitting magistrate judges to exercise jurisdiction over class actions without obtaining the consent of each absent class member. The court concluded that the magistrate judge abused her discretion by approving the settlement because there is no evidence that the relief afforded by the settlement has any value to the class members, yet to obtain it they had to relinquish their right to seek damages in any other class action. Furthermore, ARS and the named plaintiffs likewise presented no evidence that the absent class members would derive any benefit from the settlement’s cy pres award. Therefore, the court reversed and remanded. View "Koby v. Helmuth" on Justia Law

This case arose out of a dispute between a flight attendant and the airline about her sick leave. Plaintiff claimed an entitlement to use her December vacation leave for her child’s illness without being charged points, under the Washington Family Care Act, Wash. Rev. Code 49.12.270(1). The Department determined that plaintiff was entitled to use her December vacation leave to care for her child in May, and the airline was fined $200 for violating the statute. The district court subsequently granted summary judgment against the airline’s preemption claim under the Railway Labor Act (RLA), 45 U.S.C. 151-188. The court concluded that the state law right and the collective bargaining agreement are inextricably intertwined. Minor disputes are preempted by the RLA and must be dealt with first through a carrier’s internal dispute resolution process, and then a System Adjustment Board comprised of workers and management. In this case, the court concluded that the question whether plaintiff could use her vacation leave in advance of her scheduled time for this purpose is to be determined by the dispute resolution process in the collective bargaining agreement, not by the state claim resolution process. Because the district court erred by rejecting preemption, the court reversed and remanded. View "Alaska Airlines, Inc. v. Schurke" on Justia Law

Plaintiffs Marcus Labertew, his wife, and John and Jennifer McDermott filed suit against Fred R. Auzenne and Loral Langemeier in state court, claiming that Auzenne and Langemeier defrauded Marcus Labertew and John McDermott. The parties settled the case with a Damron agreement. Plaintiffs dismissed their case pursuant to the agreement, and Langemeier stipulated to a $1.5 million judgment against her, a covenant not to execute against her personally and an assignment by her to plaintiffs of her rights against her liability insurers Chartis and 21st Century. Plaintiffs then applied in state court for writs of garnishment against the insurers, and the insurers removed to federal district court. The district court concluded that it had jurisdiction, and that pursuant to Federal Rule of Civil Procedure 69, Arizona garnishment law applied. In this case, because the Labertews and the McDermotts had missed their ten day window for objecting, the garnishment failed, and under Arizona law the garnishees were discharged. The court concluded that, under Swanson v. Liberty National Insurance Co., the district court had jurisdiction over the garnishment proceeding because it is a separate and independent civil action from the suit by the Labertews and McDermotts against Langemeier. The court also concluded that not only is there no federal judgment in this case upon which to execute, but there is also no state judgment against the insurance companies that could be registered and enforced in federal court. The court explained that this is a civil action in which plaintiffs are seeking to obtain, for the first time, a judgment establishing the liability of the insurance companies. Finally, the court concluded that the district court has discretion under Rule 81(c)(2) to order repleading. Accordingly, the court reversed, vacated, and remanded. View "Labertew v. Langemeier" on Justia Law

Plaintiffs, purchasers of iPhones and iPhone apps, filed suit against Apple, alleging that Apple has monopolized and attempted to monopolize the market for iPhone apps. The court held that plaintiffs lacked antitrust standing pursuant to Illinois Brick Co. v. Illinois. The court agreed with the Third and Tenth Circuits and read Rule 12(g)(2) in light of the general policy of the Federal Rules of Civil Procedure, expressed in Rule 1. The court concluded that any error committed by the district court in ruling on Apple’s motion to dismiss under Rule 12(b)(6) for lack of statutory standing under Illinois Brick, was harmless. The court explained that Apple is a distributor of the iPhone apps, selling them directly to purchasers through its App Store. Because Apple is a distributor, plaintiffs have standing under Illinois Brick to sue Apple for allegedly monopolizing and attempting to monopolize the sale of iPhone apps. Accordingly, the court reversed and remanded for further proceedings. View "Pepper v. Apple Inc." on Justia Law

In these consolidated appeals, the court addressed an issue of first impression regarding the scope of appellate jurisdiction to review a district court’s remand order in a class action case founded on federal question jurisdiction. Although remand orders are not appealable as a matter of course, as part of the Class Action Fairness Act of 2005 (CAFA), Congress created an exception under 28 U.S.C. 1453(c)(1) that permits courts of appeals to accept appeals from remand orders in cases that are removed “under this section.” The court joined its sister circuits and concluded that this interlocutory review provision is limited to orders granting or denying remand of diversity class actions brought and removed under CAFA. The court dismissed the petition for permission to appeal, vacated the order granting fees, and remanded. View "Chan Healthcare Group v. Liberty Mutual Fire Insurance" on Justia Law

Plaintiff filed suit against Archon, alleging breach of contract stemming from Archon's issuance of a Notice of Redemption to holders of outstanding shares of preferred stock. The court concluded that the district court properly held that it lacked federal question subject matter jurisdiction under 28 U.S.C. 1331 because plaintiff did not assert a federal claim, and the Securities Litigation Uniform Standards Act, 15 U.S.C. 77p(d)(1)(A), does not provide an independent basis for federal question jurisdiction over plaintiff's state-law claim. The court also concluded that it lacked diversity jurisdiction over the class action suit under section 1332(d)(2) because of the exception provided in section 1332(d)(9)(C). Finally, the court concluded that the district court properly held that it lacked diversity jurisdiction over plaintiff's individual claim under section 1332(a) and therefore could not exercise section 1367 supplemental jurisdiction over the class members’ claims. Accordingly, the court affirmed the district court's dismissal of the complaint. View "Rainero v. Archon Corp." on Justia Law

The Centers for Medicare & Medicaid Services (CMS) pays Medicare Advantage organizations fixed monthly amounts for each enrollee. Medicare Advantage organizations have a financial incentive to exaggerate an enrollee’s health risks by reporting diagnosis codes unsupported by the enrollee’s medical records, and therefore, Medicare regulations require a Medicare Advantage organization to certify that the risk adjustment data is submits are accurate and truthful. Qui Tam Relator James Swoben filed a third amended complaint alleging that Medicare Advantage organizations performed biased retrospective medical record reviews, which rendered Defendants’ periodic certifications false, in violation of the False Claims Act. Defendants moved to dismiss Swoben’s claims. In response, Swoben sought to amend his complaint. The district court dismissed the third amended complaint with prejudice, concluding that Swoben failed to allege a claim with particularity as required by Fed. R. Civ. P. 9(b). The court also denied leave to amend, citing both futility of amendment and undue delay. The Ninth Circuit vacated the district court’s judgment, holding that the dismissing Swoben’s third amended complaint without leave to amend based on futility of amendment and undue delay and that leave to amend was proper in this case. View "United States v. United Healthcare Insurance Co." on Justia Law

The Yakama Nation, King Mountain Tobacco Company, and Delbert Wheeler brought suit for injunctive and declaratory relief seeking to bar federal agencies and officials from imposing the federal excise tax on tobacco products manufactured by King Mountain, a corporation organized, existing, and operating under the laws of the Yakama Nation. The district court granted the federal agencies’ motion to dismiss as to King Mountain and Wheeler. The court then entered summary judgment in favor of the federal agencies. The Yakama Nation appealed. The Ninth Circuit vacated the district court’s summary judgment, holding (1) Yakama Nation’s claims were barred by the Anti-Injunction Act; and (2) the Yakama Nation’s claims did not fall within the narrow exception to the Act set out in South Carolina v. Regan. Remanded with instructions to dismiss for lack of jurisdiction. View "Yakama Indian Nation v. Alcohol & Tobacco Tax & Trade Bureau" on Justia Law

After the County approved a county ordinance prohibiting the growth, testing, and cultivation of genetically engineered crops, plaintiffs filed suit to enjoin and invalidate the Ordinance. Two public-interest citizens’ groups, Shaka and MOM Hui, filed motions to intervene. The magistrate judge granted Shaka’s motion to intervene but denied MOM Hui’s, finding that Shaka would adequately represent MOM Hui’s interests. The district court held that the magistrate judge had jurisdiction to rule on MOM Hui’s motion to intervene; any appeal from the magistrate judge’s order needed to be taken to the Ninth Circuit because the magistrate judge, having obtained the consent of the parties, had authority to enter a final decision under 28 U.S.C. 636(c)(1); and thus the district court lacked jurisdiction to hear MOM Hui’s appeal. The court agreed with the Seventh Circuit that a prospective intervenor is not a "party" as the term is used in section 636(c)(1). The court concluded that, because the magistrate judge had the consent of the parties and did not need the consent of MOM Hui, the magistrate judge had jurisdiction to rule on MOM Hui’s motion to intervene. Effectively presiding as a district judge over the suit, the court explained that the magistrate judge’s intervention order became immediately appealable to this court. Accordingly, the court affirmed the judgment. View "Roberto Ito Farm, Inc. v. County of Maui" on Justia Law

Plaintiff filed suit against the State Defendants, alleging state and federal claims arising out his discharge from the Hospital and subsequent transportation to Sacramento. The district court dismissed the federal statutory claims with prejudice as a sanction under Fed. R. Civ. P. 41(b), and the supplemental state law claims without prejudice. The court held that plaintiff waived the argument that the district court abused its discretion in dismissing his federal claims under Rule 41(b). The court explained that, in the absence of a showing that the district court abused its discretion, because the prior interlocutory order of dismissal under Rule 12(b)(6) is not reviewable, there would be no basis to appeal. Therefore, the court concluded that, because plaintiff failed to make in his opening brief the abuse of discretion argument as to Rule 41(b), he has waived it. Accordingly, the court affirmed the district court's dismissal. View "Brown v. Rawson-Neal Psychiatric Hospital" on Justia Law