Justia Civil Procedure Opinion Summaries

Plaintiffs are twenty-six former employees of International Business Machines Corporation (“IBM”) who signed separation agreements requiring them to arbitrate any claims arising from their termination by IBM. The agreements set a deadline for initiating arbitration and included a confidentiality requirement. Plaintiffs missed the deadline but nonetheless tried to arbitrate claims under the Age Discrimination in Employment Act of 1967 (“ADEA”). Their arbitrations were dismissed as untimely. They then sued IBM in district court, seeking a declaration that the deadline is unenforceable because it does not incorporate the “piggybacking rule,” a judge-made exception to the ADEA’s administrative exhaustion requirements. Shortly after filing suit, Plaintiffs moved for summary judgment and attached various documents obtained by Plaintiffs’ counsel in other confidential arbitration proceedings. IBM moved to seal the confidential documents. The district court granted IBM’s motions to dismiss and seal the documents. On appeal, Plaintiffs argued that (1) the filing deadline in their separation agreements is unenforceable and (2) the district court abused its discretion by granting IBM’s motion to seal.   The Second Circuit affirmed. The court first wrote that the piggybacking rule does not apply to arbitration and, in any event, it is not a substantive right under the ADEA. Second, the court held that the presumption of public access to judicial documents is outweighed here by the Federal Arbitration Act’s (“FAA”) strong policy in favor of enforcing arbitral confidentiality provisions and the impropriety of counsel’s attempt to evade the agreement by attaching confidential documents to a premature motion for summary judgment. View "In re IBM Arb. Agreement Litig." on Justia Law

Petitioners challenged he post-trial rulings of the United States Tax Court regarding their tax obligations for the 2004 tax year. Petitioners argued that the Tax Court erroneously concluded that (1) they filed a valid joint return, (2) the Internal Revenue Service issued a statutory notice of deficiency before the limitations period for a tax assessment under I.R.C. Sections 6501(a) and (c)(4) expired, (3) they owed a $28,836 penalty pursuant to I.R.C. Section 6651(a)(1) for filing a late tax return, and (4) they owed a $128,526 penalty pursuant to I.R.C. Section 6662 for filing an inaccurate tax return.   The Second Circuit affirmed. The court held that the Tax Court did not clearly err in its finding that Petitioners intended to jointly file the Return. Further, the court wrote that the IRS issued the Deficiency Notice within the limitations period for the tax assessment. Moreover, the court held that Petitioners are subject to a $28,836 late-filing penalty under I.R.C. Section 6651(a)(1). Finally, the court held that Petitioners are subject to a $128,526 accuracy-related penalty under I.R.C. Section 6662. View "Soni v. Comm'r of Internal Revenue" on Justia Law

Plaintiff appealed the district court’s judgment dismissing for failure to state a claim his suit against Defendant-Appellee New York State Department of Corrections and Community Supervision (“DOCCS”) for attorneys’ fees and costs under 20 U.S.C. Section 1415(i)(3)(B)(i), the fee-shifting provision of the Individuals with Disabilities Education Act (“IDEA”).   The Second Circuit reversed and remanded. The court explained that the relevant provision permits a court, in its discretion, to award reasonable attorneys’ fees and related costs to “a prevailing party who is the parent of a child with a disability.” 20 U.S.C. Section 1415(i)(3)(B)(i)(I). The IDEA defines “parent” broadly to include, inter alia, foster parents, guardians, individuals “acting in the place of a natural or adoptive parent . . . with whom the child lives,” and “individual[s] who [are] legally responsible for the child’s welfare.” On de novo review, the court concluded that the IDEA permits a court to award fees and costs to J.S. as “an individual who is legally responsible for the child’s welfare” because, as an adult “child with a disability” and without representation by a guardian, natural parent, or appointed individual, he prevailed in his action on his own behalf seeking required educational services from DOCCS. View "J.S. v. DOCCS" on Justia Law

The Second Circuit vacated and remanded the district court’s ruling granting summary judgment for Defendants, a former Immigration and Customs Enforcement officer. Plaintiff, Jane Doe, alleged she was sexually and psychologically abused by Defendant, a former Immigration and Customs Enforcement officer. Four years after the abuse ended, Doe initiated this action against Rodriguez and various government defendants. Defendants moved for summary judgment, arguing Doe’s claims were untimely. Doe asked the district court to equitably toll the applicable statutes of limitations. The court granted summary judgment to Defendants.   The Second Circuit vacated and remanded. The court explained that in this case, the district court denied equitable tolling as a matter of law, purporting to draw every inference in favor of Doe. The court vacated its judgment because the record allows for a finding that Doe faced extraordinary circumstances and acted with reasonable diligence. On remand, the district court should act in a fact-finding capacity and determine whether Doe has demonstrated extraordinary circumstances and reasonable diligence. The court explained that if the court determines that she has established these prerequisites for equitable tolling, then it should engage in the discretionary determination of whether to grant her request for equitable tolling. View "Doe v. United States" on Justia Law

Petitioners challenged the post-trial rulings of the United States Tax Court regarding their tax obligations for the 2004 tax year. Petitioners argued that the Tax Court erroneously concluded that (1) they filed a valid joint return, (2) the Internal Revenue Service issued a statutory notice of deficiency before the limitations period for a tax assessment under I.R.C. Sections 6501(a) and (c)(4) expired, (3) they owed a $28,836 penalty pursuant to I.R.C. Section 6651(a)(1) for filing a late tax return, and (4) they owed a $128,526 penalty pursuant to I.R.C. Section 6662 for filing an inaccurate tax return.   The Second Circuit affirmed. The court held that the Tax Court did not clearly err in its finding that Petitioners intended to jointly file the Return. Further, the court concluded that the IRS issued the Deficiency Notice within the limitations period for the tax assessment. The court held that Petitioners are subject to a $28,836 late-filing penalty under I.R.C. Section 6651(a)(1). Finally, the court held that Petitioners are subject to a $128,526 accuracy-related penalty under I.R.C. Section 6662. The court explained that Petitioner’s inaccuracy was not the product of reasonable reliance upon the advice of a tax professional. As the Tax Court also found, Petitioners failed to provide their accountants “necessary and accurate information.” Moreover, the record includes evidence that Petitioner disregarded the advice of accountants who warned him that he would need proof to substantiate the claimed loss. View "Soni v. Comm'r of Internal Revenue" on Justia Law

Plaintiff-Appellant FAT Brands Inc. alleged that Defendants engaged in a conspiracy to defraud Plaintiff by misleading it as to the source and certainty of deal funding. On appeal, FAT Brands Inc. argues that the district court (Furman, J.) erred by dismissing claims against Defendants-Appellees Kristina Fields and Mickey Edison for lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2); claims against Defendants-Appellees SJ Global Investments Worldwide, Ltd., SJ Global Investments, Ltd., Peter Samuel, and Neil Walsh for failure to state a claim pursuant to Rule 12(b)(6); and separate claims against Defendant-Appellee Wesley Ramjeet for failure to state a claim.   The Second Circuit vacated in part and affirmed in part the district court’s decision and remanded. The court held that FAT Brands plausibly alleged a conspiracy in which both Fields and Edison joined and participated. As such, the court turned to the three additional requirements to establish personal jurisdiction over a co-conspirator under New York law (awareness, benefit, and direction or control). The court held that all three are satisfied. Accordingly, the court vacated the district court’s order dismissing Count IV against Fields and Edison.   Further, the court wrote that because FAT Brands adequately alleged that the SJ Global Defendants conspired with the PPMT Defendants to commit the fraud, it states a claim against the SJ Global Defendants for the primary fraud tort as well. Accordingly, the court vacated the district court’s order dismissing Count IV against the remaining SJ Global Defendants. View "FAT Brands Inc. v. Ramjeet et al." on Justia Law

Plaintiff sued her brother, the executor of their father's estate, under the Racketeer Influenced and Corrupt Organizations Act. The district court held that Plaintiff's claims were barred by the Private Securities Litigation Reform Act of 1995 (“RICO Amendment”), which provides that “no person may rely upon any conduct that would have been actionable as fraud in the purchase or sale of securities to establish a violation of [RICO].” 18 U.S.C.1964(c).The Second Circuit reversed, holding that Plaintiff's claims were not barred by the RICO Amendment because the fraud she alleged was not related to the “purchase or sale of securities.” The alleged frauds committed by her brother "only incidentally involved securities, unlike a securities broker who sells client securities in breach of his duty to execute securities transactions in the best interests of the client." View "D'Addario v. D'Addario" on Justia Law

Petitioner appealed from a district court judgment dismissing his to confirm an arbitral award. The court held that a forum selection 2 clause in the parties’ arbitration agreement required that any confirmation action be brought in the state courts of New Jersey or New York, and that this deprived the district court of subject matter jurisdiction.   The Second Circuit vacated. The court concluded that the district court erred in dismissing Petitioner’s petition. First, the court held that the petition adequately pleaded subject matter jurisdiction based on diversity of citizenship. Because parties cannot contractually strip a district court of its subject matter jurisdiction, it was error to conclude that the forum selection clause did so. Second, the court interpreted the relevant forum selection clauses as permissive arrangements that merely allow litigation in certain fora, rather than mandatory provisions that require litigation to occur only there. Accordingly, applying the modified forum non conveniens framework, the court held that the forum selection clauses did not bar proceedings from going forward in the United States District Court for the Southern District of New York. View "Rabinowitz v. Kelman" on Justia Law

Niagara County’s Child Protective Services successfully petitioned in Niagara County Family Court to strip Plaintiff of her parental rights over her minor son. Plaintiff appealed the Family Court’s decision. While that appeal was pending, she brought suit in federal court against officials and entities involved in terminating her parental rights. The district court dismissed Plaintiff’s suit pursuant to the Rooker-Feldman doctrine.   The Second Circuit vacated the judgment insofar as the district court denied Plaintiff’s motions for leave to amend and for additional time to serve defendants. The court held that the RookerFeldman doctrine does not apply when an appeal remains pending in state court. Rooker-Feldman applies only after the state proceedings have ended. View "Hunter v. McMahon" on Justia Law

Plaintiffs, who operate small venue theaters in New York City, brought claims for declaratory and injunctive relief and nominal damages, alleging that the City’s Key to NYC program—which required certain indoor venues to check the COVID-19 vaccination status of patrons and staff before permitting entry—violated their rights to free speech and equal protection under the First and Fourteenth Amendments. Following the expiration of the Key to NYC program, the district court dismissed as moot Plaintiffs’ claims for declaratory and injunctive relief. The district court also dismissed Plaintiffs’ claim for nominal damages for lack of standing, concluding that Plaintiffs failed to plausibly allege an injury in fact. Plaintiffs now appeal that order.   The Second Circuit concluded that Plaintiffs have plausibly alleged Article III standing. However, the court affirmed the judgment of dismissal on the alternative ground of failure to state a claim. The court explained that Key to NYC does not impair a fundamental right because it does not violate Plaintiffs’ First Amendment rights. Nor does it target a suspect class. These are locations where large numbers of unassociated individuals are likely to gather and spend significant amounts of time exposed to one another, thereby posing a relatively high risk of spreading COVID-19. Requiring individuals in those settings to be vaccinated mitigated that risk and incentivized vaccination among the people most likely to be in a position to spread the virus. Accordingly, Plaintiffs have not plausibly alleged an equal protection violation. View "Clementine Co. v. Adams" on Justia Law