Justia Civil Procedure Opinion SummariesArticles Posted in U.S. Court of Appeals for the Seventh Circuit
Davis v. Fenton
Davis sued, asserting malpractice and breach of contract claims, and federal Fair Housing Act (FHA) and Civil Rights Act claims, arising out of Fenton’s legal representation of Davis in a mortgage foreclosure action in which Davis lost her home. Davis alleged that Fenton’s representation of her was deficient and that he had targeted her for deficient representation because of her race. Because Fenton’s contract with Davis required the parties to arbitrate any disputes, the district judge ordered the suit “stayed pending arbitration.: Arbitrators awarded Davis $82,528.10 in damages for malpractice but denied her other claims. Fenton sued in Illinois state court to have the award vacated. Davis moved the federal court to reinstate her suit, to confirm the award under 9 U.S.C. 9, and to permit her to file a new FHA claim, accusing Fenton of retaliating against her for having filed her original claim. Fenton failed to appear; the judge entered a default judgment granting the motion. The court refused to vacate the default and remand to state court but dismissed the retaliation claim. The Seventh Circuit affirmed. The federal judge had jurisdiction over the case when it was filed; the order staying the case, subject to reinstatement, retained jurisdiction to confirm or vacate an arbitral award. The court affirmed the dismissal; filing a lawsuit cannot be considered retaliation, except in extraordinary circumstances. View "Davis v. Fenton" on Justia Law
Parungao v. Community Health Systems, Inc.
Dr. Parungao began practicing surgery at Galesburg Cottage Hospital in 2006. He accepted employment with Knox Clinic, which supplies doctors for the hospital. Knox told Dr. Parungao in 2013 that it was discharging him without cause, as allowed under his employment agreement. Parungao believes that the hospital orchestrated this discharge to harm his career. He asserts that before Knox fired him, the hospital’s medical executive committee manipulated the peer-review process to insinuate that he had performance problems and make it difficult for him to secure future employment. Parungao later resigned from Galesburg and sought other employment, but alleges that he was thwarted in those efforts by the hospital and its doctors. Based on those events, Parungao filed a suit against the hospital that he voluntarily dismissed, was denied permission to refile the case under seal with a fictitious name, then filed another state court suit against the chief of medical staff, Piper for defamation. The Piper suit was dismissed for failure to state a claim. Parungao’s federal suit against the hospital was subsequently dismissed as barred by res judicata. The Seventh Circuit affirmed. Although the federal suit did not mention Piper, the elements of privity, identity of causes of action, and finality were met. View "Parungao v. Community Health Systems, Inc." on Justia Law
Veljkovic v. Carlson Hotels, Inc.
The “Old Mill” in Belgrade, Serbia, was confiscated, allegedly from plaintiffs' ancestors, in 1945, without compensation, and later sold to private developers. Prigan now holds title and, with Carlson, renovated the Old Mill. The property is now a four‐star Radisson Blu Hotel complex. Carlson is the licensor of the Radisson Blu brand and participates in the hotel’s management. Ten years before the hotel's construction, plaintiffs began trying to recover their rights over the Old Mill. In 2009 a Serbian court annulled the declaration that plaintiffs’ family were enemies of the state. They sued Carlson, alleging trespass, conversion, conspiracy, unjust enrichment, constructive trust, and violation of the Minnesota Deceptive Trade Practices Act. Carlson agreed to submit to the jurisdiction of the Serbian Restitution Agency, which was empowered by Serbia's 2011 “Law on Property Restitution and Compensation” to determine rights in the property, including improvements. The judge dismissed the suit on the ground of forum non conveniens. The Seventh Circuit affirmed, noting that the plaintiffs produced no documentary evidence that they have inherited the land and that the dispute is appropriate for the Serbian Agency . Although one plaintiff is an American citizen and a resident of Illinois, the other is a citizen of Canada but a resident of Paris; no aspect of the dispute has any relation to Illinois. View "Veljkovic v. Carlson Hotels, Inc." on Justia Law
Medici v. City of Chicago
Appeal of dismissal of challenge to city’s order requiring that police officers cover tattoos was rendered moot by city’s revocation of the order. Plaintiffs, military veterans employed as Chicago police officers, have tattoos relating to their military service and religion. The department issued an order without prior notice, requiring all officers on duty or otherwise “representing” the department to cover their tattoos. The announced reason was to “promote uniformity and professionalism.” Plaintiffs complained that covering their tattoos with clothing caused overheating in warm weather and that cover-up tape irritated their skin. The complaint sought a declaratory judgment that the order violated theirs’ First Amendment rights, attorneys’ fees and costs, and “other legal and/or equitable relief.” Without addressing class certification and before discovery, the court dismissed the suit on the merits, finding that wearing tattoos was a “personal expression,” not an effort at communicating with the public on matters of public concern, and was not protected by the First Amendment. Meanwhile, the police union filed a grievance. An arbitrator ruled that the order violated the collective bargaining agreement. The city conceded and agreed to reimburse officers for expenses in complying with the invalidated policy. The Seventh Circuit directed that the judgment vacated as moot. View "Medici v. City of Chicago" on Justia Law
Plata v. Eureka Locker, Inc.
Dead Man’s Act barred testimony regarding now-deceased employer’s response to being told employee would file a worker’s compensation claim. Plata sued Eureka under 42 U.S.C. 2000e, claiming that he was fired in retaliation for having filed such a claim. He claimed that Bittner, Eureka’s owner, told him he was “done” after he told Bittner that he intended to file the claim. Bittner died suddenly, leaving Plata the only witness to the conversation. Eureka cited the Illinois Dead Man’s Act, 735 ILCS 5/8-301, which “forbids a party to a suit by or against a firm to testify about any conversation with a dead agent of the firm, unless a living agent of the firm was also present.” Federal Rule of Evidence 601 states that “in a civil case, state law governs the witness’s competency regarding a claim or defense for which state law supplies the rule of decision.” The Seventh Circuit affirmed that Plata could testify that he had told Bittner that he intended to file a claim, but could not testify to Bittner’s response. The courts rejected the federal claims as time-barred and unsupported by evidence, noting that Plata was a difficult litigant, whose lawyer was allowed to withdraw after Plata refused to respond to discovery requests. View "Plata v. Eureka Locker, Inc." on Justia Law
Ozinga v. Price
The Seventh Circuit directed the district court to dismiss, as moot, a lawsuit by a Chicago-area family-owned firm, challenging the “contraception mandate” under the Patient Protection and Affordable Care Act of 2010, 124 Stat. 119. Ozinga regards certain of the contraceptives covered by the mandate as potential abortifacients, the use of which is proscribed by its owners’ and managers’ religious tenets, and sued under the Religious Freedom Restoration Act, 42 U.S.C. 2000bb, in 2013. The government had established an accommodation for certain religious employers that provided for alternate means of ensuring employee access to the contraceptive services specified by the mandate without payment or direct involvement by an objecting employer; the accommodation was not then available to for-profit employers like Ozinga. In light of Seventh Circuit precedent, the district court granted Ozinga a preliminary injunction. The Supreme Court subsequently decided, in “Hobby Lobby” (2014), that the contraception mandate, as applied to closely-held private firms whose owners objected on religious grounds to contraceptives covered by the mandate, substantially burdened the exercise of religion by those owners and their companies, in view of the fines to which they were subject for noncompliance. The government then extended the accommodation to private employers, including Ozinga, rendering its suit moot. View "Ozinga v. Price" on Justia Law
Watkins v. United States
At the emergency room of Ingalls Memorial Hospital, Ford was treated by Dr. Parks‐Ballard, a Family Christian Health Center employee. A 2015 federal complaint alleged that Parks-Ballard failed to properly diagnose and treat Ford, who was eventually diagnosed with Wernicke’s encephalopathy and who sustained neurological injuries including permanent disability. Because Family operated with money from the Public Health Services, a government agency, the 2015 suit was filed under the Federal Tort Claims Act (FTCA), 28 U.S.C. 2675(a) and the United States was the defendant. In determining that the claim accrued as of August 2010, the district court took judicial notice of a state court medical malpractice claim filed in August 2010 by Ford against Ingalls, Parks‐Ballard, and Family, including virtually the same allegations as the FTCA complaint. Ford voluntarily dismissed that complaint. The Seventh Circuit affirmed dismissal, based on the two-year statute of limitations. Regardless of Ford’s alleged mental disabilities, the 2010 complaint reflected an awareness that Ford’s injuries were caused by the defendant (through its agents). Ford’s claim was not presented to an administrative agency until 2015. View "Watkins v. United States" on Justia Law
Smego v. Payne
Smego, a civilly committed sex oﬀender at Rushville, sued his treatment team, alleging that another resident sexually assaulted him and that defendants forced Smego to continue group therapy with his alleged assailant and retaliated against Smego. After the Seventh Circuit held that Smego was entitled to a jury trial, Smego was represented by University of Illinois law students. Before trial, Smego appeared by video conference or telephone at hearings. For trial, Smego appeared in person. During an oﬀ‐the‐record break after closing arguments, the judge removed Smego for transport back to Rushville. The court did not address this removal on the record and issued no cautionary jury instruction regarding Smego’s absence, but instructed the jury that its verdict must be unanimous. Smego was not presemt when the jury found in favor of defendants. The judge asked whether the students wanted the jury polled, and a student, without consulting Smego, responded in the negative. The Seventh Circuit affirmed. There is no evidence that the jury had questions during deliberation or had any reason to know that Smego was not present during deliberations. Failing to poll the jury when it is clear that the verdict was unanimous, was a “minor matter.” View "Smego v. Payne" on Justia Law
1st Source Bank v. Neto
Neto, a Brazilian businessman, entered into a trust agreement with Wells Fargo in 2009 to purchase an aircraft for his business. Wells Fargo borrowed $6 million from 1st Source, pledging the aircraft as collateral. Neto signed a personal guarantee. Three years later, Brazilian tax authorities seized the plane. After Neto stopped paying, 1st Source sued him in an Indiana district court, then filed another lawsuit in Brazil, where the plane resides. Brazilian law permits prejudgment attachment of assets, so that Neto would have only three days to pay the debt after being served with a summons; if he failed to comply the court could seize as many assets as necessary to guarantee payment. Neto unsuccessfully sought to enjoin the Brazilian lawsuit on grounds that the guarantee did not permit duplicative litigation and that the Brazilian litigation was “oppressive.” The Seventh Circuit affirmed denial of Neto’s subsequent motion for an emergency injunction pending appeal, finding that Neto had not shown a sufficient likelihood of prevailing on his claim that the Brazilian litigation was improper. The guarantee Neto signed proves that 1st Source reserves the option to sue Neto for the debt, “in any jurisdiction where the aircraft may be located.” He did not provide sufficient information about the Brazilian lawsuit to establish that it is duplicative of the Indiana suit. View "1st Source Bank v. Neto" on Justia Law
Leibovitich v. Bank of Tokyo-Mitsubishi UFJ
In 2003, a 7-year-old Israeli girl was killed, her 3-year-old, American-citizen sister permanently disabled, and six Israeli members of their family were injured emotionally, when their minivan was shot up on a Jerusalem highway by members of Palestine Islamic Jihad, a terrorist group supported by the government of Iran. The survivors sued Iran under the Antiterrorism Act, 18 U.S.C. 2333, and the Foreign Sovereign Immunities Act, 28 U.S.C. 1605A, eventually obtaining a $67 million default judgment. The plaintiffs issued federal and state subpoenas, seeking an order directing foreign parent banks to reveal Iranian assets held in any of their worldwide branches. The Japanese bank has branches in more than 40 countries; the French bank has branches in 75 countries. The banks provided the information only with respect to their 17 U.S. branches, which held no Iranian assets. The banks sought to quash the subpoenas. Plaintiffs argued that personal jurisdiction was irrelevant for enforcing subpoenas under Rule 45. The Seventh Circuit affirmed, in favor of the banks. To be entitled to use the federal district court in Chicago to obtain the information plaintiffs sought, they had to prove personal jurisdiction over the banks. The banks are not incorporated or headquartered in the U.S. and the subpoenas were not tailored to the banks’ U.S. presence or activities. View "Leibovitich v. Bank of Tokyo-Mitsubishi UFJ" on Justia Law