Justia Civil Procedure Opinion Summaries

Articles Posted in US Court of Appeals for the Eighth Circuit
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Plaintiff filed suit against several out-of-state defendants in Minnesota state court, alleging that defendants participated in a fraudulent scheme. After defendants removed to federal district court, the case was dismissed based on lack of personal jurisdiction. The Eighth Circuit affirmed the district court's dismissal, holding that plaintiff was the only connection between Minnesota and the underlying dispute. In this case, requiring defendants to litigate this action in Minnesota would offend due process because defendants' contacts were insufficient to confer specific jurisdiction. View "Pederson v. Frost" on Justia Law

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This case arose when plaintiff fell from the trunk of the car that her friend was driving and sustained serious injuries. In a related case, the district court held a bench trial to apportion the fault between the friends involved in the accident. In this case, plaintiff filed suit to recover the portion of the judgment allocated to one of the friends, seeking underinsured motorist benefits for the friend's portion of the judgment. The district court granted Owners' motion for summary judgment. The Eighth Circuit held that removal was not proper under diversity jurisdiction where the parties conceded that the amount in controversy was statutorily insufficient. The court also held that there was no supplemental jurisdiction because this case was a separate action and not another claim in an underlying action over which the federal courts have jurisdiction. Accordingly, the court vacated and remanded to the district court with instructions to remand the case to state court. View "Mensah v. Owners Insurance Co." on Justia Law

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Russell, Daniel, and Carson co-owned a business. Under a succession plan, the company was to purchase life insurance. If a shareholder died, the company would use the proceeds to buy the deceased shareholder’s stock. Daniel died. The company received insurance proceeds and kept the money. Elizabeth, Daniel’s widow, sued Russell and Carson for conversion and breach of fiduciary duty. A Kansas court issued a judgment against Russell for $822,900.77. Russell and Carson had expected Liberty to defend and indemnify them under their Directors, Officers and Company Liability Coverage and Fiduciary Liability Coverage. Liberty cited a “Personal Profit Exclusion” for claims based upon "gaining ... any profit, remuneration or financial advantage” to which they are “not legally entitled” and a “Contract Exclusion” regarding claims "attributable to any actual or alleged liability under or breach of any contract.” Russell and Carson sued Liberty in Missouri state court for bad-faith. Elizabeth joined the suit. Liberty, a corporate citizen of Massachusetts and Illinois, removed the case to federal court. Russell and Carson sought remand, arguing that in “direct action[s]” against insurers, the insurer takes the citizenship of those it insures, 28 U.S.C. 1332(c)(1); if the Trust’s equitable garnishment claim was a direct action, Liberty shared Russell’s Missouri citizenship. The district court held that the equitable garnishment claim required Russell as a defendant, but Russell’s bad-faith claim required him as a plaintiff. The court severed the suit: Russell and Carson could sue for bad-faith failure to defend and indemnify; the Trust could separately sue Liberty and Russell. The Eighth Circuit affirmed summary judgment on the bad faith claim. Because the Missouri statutory claim is not a direct action, complete diversity exists. The district court had jurisdiction over the bad-faith claim. The policy exclusions applied. View "Russell v. Liberty Insurance Underwriters, Inc." on Justia Law

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The Eighth Circuit affirmed the district court's denial of defendant's motions for dismissal and for summary judgment, granting summary judgment to the law firm. The court applied a five-factor test to determine the sufficiency of defendant's contacts and held that, when all of the circumstances are viewed in the aggregate, defendant had fair warning that he could be subject to jurisdiction in Arkansas. In this case, defendant's contacts with Arkansas involved more than just his guaranty; the language of the contract provided for Cuker to perform its obligations in the Western District of Arkansas; and, as personal guarantor of Cuker's performance, it was reasonable and foreseeable for defendant to anticipate being haled into that same court if Cuker failed to perform. The court rejected defendant's claim that his personal guaranty is unenforceable as a matter of law because his obligations are not adequately specified. The court held that the express terms of the legal services agreement evidence an intent to hold defendant liable to the same extent as Cuker's liability. Finally, the court applied state, not federal elements of estoppel in diversity cases, and held that the district's reasoning and the record supported equitable estoppel. View "Henry Law Firm v. Atalla" on Justia Law

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The Eighth Circuit affirmed the district court's denial of a successive petition for a certificate of innocence, holding that the petition was barred by the doctrine of res judicata and that the district court did not err in finding that defendant's petition was barred. In a previous case, the court reversed federal gambling and money laundering convictions of RSI and its president, defendant, because the government failed to prove any of the offenses charged. RSI and defendant then petitioned for a certificate of innocence, the statutory prerequisite to an action in the Court of Federal Claims seeking damages from the government for wrongful imprisonment. The court affirmed the denial of the district court's petition, because RSI and defendant were not truly innocent of a state criminal gaming law violation. View "United States v. Bala" on Justia Law

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The Eighth Circuit vacated the district court's dismissal of plaintiff's amended complaint against TAW Enterprises, alleging that TAW retaliated against plaintiff in contravention of public policy established by the Gramm-Leach-Bliley Act and breached its employment contract with plaintiff. The court held that neither this court or the district court could properly exercise subject matter jurisdiction over this action because removal premised on diversity jurisdiction would violate the forum-defendant rule, a jurisdictional defect in this circuit, and plaintiff's amended complaint did not present a federal question. Accordingly, the court remanded with instructions to the district court to remand the case to state court. View "Holbein v. Baxter Chrysler Jeep, Inc." on Justia Law

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The Eighth Circuit reversed the district court's dismissal, based on lack of personal jurisdiction, of plaintiffs' action against defendants over a dispute involving an investment agreement. The court held that defendants had sufficient contacts with Arkansas to establish personal jurisdiction in light of the nature and quality of contacts with the forum state, the quality of contacts, the relation of the cause of action to the contacts, the interest of forum state, and the convenience of the parties. In this case, the court held that the first and third factors weigh in favor of personal jurisdiction, while the second, third, and fourth factors were more neutral. The court found that personal jurisdiction applies to the claims asserted against both Defendants Esebag and ULG, and thus Esebag's actions were sufficient to bind the company and assert personal jurisdiction over ULG without violating the traditional notions of fair play and substantial justice. View "Whaley v. Esebag" on Justia Law

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After plaintiff was injured when a neck brace allegedly caused or failed to protect him from serious bodily injury, he filed suit against the makers and sellers of the neck brace. The Eighth Circuit affirmed the district court's orders granting defendants' motions to dismiss. The district court correctly noted that, even though entry of default was proper where a party fails to respond in a timely manner, a court must not enter default without first determining whether the unchallenged facts constitute a legitimate cause of action. In this case, all but one of the allegations in the amended complaint constitute mere legal conclusions and recitations of the elements of the causes of action. The court agreed with the district court that where, as here, there are so few facts alleged in the complaint, the court need not address each individual claim to make a sufficiency determination on a Federal Rule of Civil Procedure 12(b)(6) motion to dismiss. Accordingly, because the amended complaint failed to allege sufficient facts to state a claim for relief that was plausible on its face, the district court did not err in granting defendants' motion to dismiss. View "Glick v. Western Power Sports, Inc." on Justia Law

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Plaintiff and others filed a class action against defendants, alleging claims under the Fair Labor Standards Act (FLSA) and Nebraska law, arising out of an eight-week student-driver training program operated by defendants and intended for new truck drivers. The Eighth Circuit agreed with defendants that the district court abused its discretion by granting plaintiffs' request to extend the Federal Rule of Civil Procedure 16(b) disclosure deadline, despite finding that good cause for the extension had not been shown, based on an erroneous application of Rule 37(c)(1). The court held that the error was not harmless because the jury clearly relied on the opinion of plaintiff's expert in reaching the damages award. Accordingly, the court vacated and remanded for further proceedings. View "Petrone v. Werner Enterprises, Inc." on Justia Law

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Plaintiffs filed a class action in state court against Massage Envy, alleging that the company violated the Missouri Merchandising Practices Act (MMPA) when advertisements for its one hour massage session failed to disclose that the session included ten minutes to undress, dress, and consult with the therapist. Massage Envy removed the case to district court under the Class Action Fairness Act. The Eighth Circuit held that the district court misapplied controlling Supreme Court and Eighth Circuit CAFA precedents. The court held that the district court erred when it evaluated the MMPA violations alleged in plaintiffs' second amended petition and remanded the class action to state court because "it is more likely that a reasonable fact finder would not award several million dollars in punitive damages." In this case, the district court's consideration went to the merits of plaintiffs' claims. The court held that plaintiffs' allegation that they were entitled to punitive damages in an unstated amount raised the amount in controversy to more than $5 million, whether or not they ultimately prove they were entitled to the punitive damages they claimed. Finally, the court also held that when Massage Envy investigated and filed a notice of removal based on the results of its own amount-in-controversy investigation, the notice was not untimely. Therefore, the court granted the petition for permission to appeal, reversed the July 2019 order of remand, denied plaintiffs' motion for remand, and remanded for further proceedings. View "Pirozzi v. Massage Envy Franchising" on Justia Law