Justia Civil Procedure Opinion SummariesArticles Posted in US Court of Appeals for the Sixth Circuit
Republic Building Co., Inc. v. Charter Township of Clinton, Michigan
In 1999, the plaintiffs sought to develop condominiums but needed rezoning approval from the Charter Township of Clinton. After a protracted dispute, the plaintiffs sued the Township in Michigan state court. That court entered a consent judgment that dictated the conditions for rezoning the property and completing the project. Years later, after experiencing several setbacks, the plaintiffs sought to amend the consent judgment, but the Township refused.The plaintiffs then filed suit in federal court, alleging several constitutional violations and a breach-of-contract claim. The Sixth Circuit affirmed the dismissal of the suit. The consent judgment contains a “retaining-jurisdiction” provision providing Macomb County Circuit Court jurisdiction over its interpretation and enforcement. A separate lawsuit filed in federal district court would constitute a collateral attack on the consent judgment, requiring the district court in some way to interpret or enforce it. All of plaintiffs’ alleged constitutional violations stem from the Township’s alleged refusal to “honor its obligations under the Consent Judgment to allow plaintiffs to develop the Subject Property.” View "Republic Building Co., Inc. v. Charter Township of Clinton, Michigan" on Justia Law
Pedreira v. Sunrise Children’s Services, Inc.
Over 20 years ago, taxpayers sued Kentucky and Sunrise, a religiously affiliated organization, for alleged violations of the Establishment Clause by paying for religious services that Sunrise allegedly imposed on children in state custody. The Sixth Circuit remanded the approval of a 2013 settlement. In 2015, the parties replaced monitoring provisions that mentioned Sunrise with general language about “any Agency.” The Third Circuit held, for the third time, that the plaintiffs had standing to bring their Establishment Clause claim but that the 2015 Amendment required new regulations or modifications to existing regulations for implementation, which meant the Amendment violated Kentucky law. In 2021 Kentucky and the plaintiffs jointly moved to dismiss the case with prejudice. Kentucky agreed to pursue new regulations in good faith; certain provisions of the Agreement would not take effect unless those regulations were adopted. The Settling Parties did “not” seek to have the court retain jurisdiction for enforcement, nor to incorporate the Agreement in the order of dismissal.Noting that the motion was filed by “the parties to the sole remaining claim,” the Establishment Clause claim against Kentucky, the district court dismissed the case. The court refused to address the terms of the 2021 Agreement, which was not properly before it. The Sixth Circuit affirmed. “Sunrise no doubt is frustrated to find itself unable to vindicate the legality of its program” but federal courts do not decide constitutional issues in the abstract. View "Pedreira v. Sunrise Children's Services, Inc." on Justia Law
Jarrett v. United States
Jarrett produces Tezos tokens cryptocurrency by “staking.” Jarrett claims staking uses existing Tezos tokens and computing power to produce new tokens, so he owes tax on the tokens only when he sells or transfers them and “realizes” income, 26 U.S.C. 61(a). The IRS's position was that Jarrett realized income when he received each token. Jarrett’s 2019 staking yielded 8,876 Tezos tokens; he “did not sell, exchange, or otherwise dispose of these tokens during 2019.” He reported those tokens as income and paid tax, then asked the IRS for a refund ($3,793). After six months, Jarrett filed a refund lawsuit, 28 U.S.C. 1346(a)(1), seeking a judgment that Jarrett was entitled to a refund; costs and attorney’s fees; and an injunction preventing the IRS “from treating tokens created by the Jarretts as income.”The Attorney General approved Jarrett’s refund request. The IRS issued a $4,001.83 refund check and a “Notice of Adjustment.” Preferring to litigate the case to judgment, Jarrett has “not cashed, and [does] not intend to cash, this check.” The district court dismissed the case as moot. The Sixth Circuit affirmed. Refund lawsuits exist for a single purpose: “the recovery of any internal-revenue tax alleged to have been erroneously or illegally assessed or collected.” The IRS satisfies its repayment obligation when it issues and mails a refund check for the full amount of the overpayment. View "Jarrett v. United States" on Justia Law
Sullivan v. LG Chem Ltd.
LG Chem manufactured the LG HG2 18650 lithium-ion batteries that exploded in Sullivan’s pocket and caused him severe second- and third-degree burns. Sullivan obtained the batteries from a vape store in Michigan to use for his e-cigarette device. In Sullivan’s suit, LG Chem, a South Korean company, opposed personal jurisdiction, arguing that exercising personal jurisdiction over it in Michigan would be improper under Michigan’s long-arm statute and the Due Process Clause. Limited discovery revealed that LG sent at least two shipments of 18650 batteries directly into Michigan and had executed “two supplier agreements . . . with Michigan companies relating to 18650 batteries.” Neither party addressed whether any of the 18650 batteries that LG shipped into Michigan was ultimately one of the batteries that injured Sullivan.The Sixth Circuit reversed the dismissal of the suit. LG urged too narrow a view of personal jurisdiction. The Michigan district court may properly exercise personal jurisdiction over LG because it directly shipped its 18650 batteries into the state and entered into two supplier contracts with Michigan companies for 18650 batteries. The court noted that other courts have exercised personal jurisdiction over LG when LG conducts business related to its 18650 batteries in or ships its 18650 batteries into the forum state. View "Sullivan v. LG Chem Ltd." on Justia Law
Sterling Hotels, LLC v. Scott McKay
Sterling Hotels sued a state elevator inspector (Defendant), asserting several claims under 42 U.S.C. Section 1983. Sterling first argued that Defendant violated its right to due process when he sealed Wyndham’s elevators without giving Sterling notice or an opportunity to object. Further, Sterling argued that Defendant engaged in an unconstitutional regulatory taking when he sealed the elevators. Defendant moved to dismiss, in part on qualified immunity grounds. The district court declined to address Defendant’s entitlement to immunity, and Defendant appealed. The Sixth Circuit affirmed in part and reversed in part. The court explained that when a deprivation of property “occurs pursuant to an established state procedure”—as Defendant acknowledges it did here—the state must provide adequate notice and an opportunity to respond before the deprivation. Here, Defendant sealed the elevators without providing any advance notice that the elevators should descend to the basement. Thus, Sterling alleged, Defendant failed to provide it with any opportunity to respond to that requirement. That is sufficient to state a due-process claim against Defendant. Further, Defendant’s potential individual liability for a regulatory takings claim was not clearly established when he sealed the elevators. That means Defendant is entitled to qualified immunity on this claim. View "Sterling Hotels, LLC v. Scott McKay" on Justia Law
Said Taleb v. Wendy Lewis
Appellant obtained a judgment against his employer after the employer made also accusations that Appellant committed embezzlement and forgery. Shortly thereafter, Appellant's employer filed for Chapter 7 Bankruptcy, both individually and on behalf of his business. Appellant appealed the bankruptcy court's ruling, arguing that he received an insufficient amount as an unsecured creditor.The court explained that "the doctrine of equitable mootness has no place in Chapter 7 liquidations." View "Said Taleb v. Wendy Lewis" on Justia Law
United States v. State of Michigan
After extensive litigation, the United States, Michigan, and five federally recognized tribes entered the Great Lakes Consent Decree of 1985, governing the regulation of Great Lakes fisheries. The subsequent Consent Decree of 2000 had a 20-year term. The district court extended that Decree indefinitely “until all objections to a proposed successor decree have been adjudicated” and granted amicus status to the Coalition, which represents numerous private “sport fishing, boating, and conservancy groups” interested in protecting the Great Lakes. The Coalition has represented its own interests during negotiation sessions.As the parties were concluding their negotiations on a new decree the Coalition moved to intervene, stating that Michigan is no longer “willing or able to adequately represent the Coalition’s interests” and intends to abandon key provisions of the 2000 Decree that promote biological conservation and diversity, allocate fishery resources between sovereigns, and establish commercial and recreational fishing zones. The district court denied the Coalition’s most recent motion to intervene. The Sixth Circuit affirmed. In finding the motion untimely, the district court properly considered “all relevant circumstances” including the stage of the proceedings; the purpose for the intervention; the length of time that the movant knew or should have known of its interest in the case; the prejudice to the original parties; and any unusual circumstances militating for or against intervention. View "United States v. State of Michigan" on Justia Law
Clark v. A&L Homecare & Training Center, LLC
The named plaintiffs, former home-health aides, sued A&L under the Fair Labor Standards Act (FLSA), claiming that A&L had paid them less than the correct overtime rate and under-reimbursed their expenses. Plaintiffs may bring such claims on behalf of other “similarly situated” employees. 29 U.S.C. 216(b). The plaintiffs sought to facilitate notice of their action to three groups of other employees who had worked for A&L. The court adopted a two-step procedure under which it would facilitate such notice following “conditional certification,” which required a “modest factual showing” that the other employees are “similarly situated” to the original plaintiffs. When merits discovery is complete, the court must grant “final certification” for the case to proceed as a collective action. The court applied that “fairly lenient” standard, and “conditionally certified” two groups for receiving notice. The court declined to facilitate notice to employees who had left A&L more than two years before or who had signed a “valid arbitration agreement” with A&L.On interlocutory appeal, the Sixth Circuit rejected the lenient standard, vacated the notice determination, and remanded for redetermination of that issue under the strong-likelihood standard. The court noted that the decision to send notice of an FLSA suit to other employees is often dispositive, in the sense of forcing a settlement. As a practical matter, it is not possible to conclusively make “similarly situated” determinations as to employees who are not present in the case. View "Clark v. A&L Homecare & Training Center, LLC" on Justia Law
Hohenberg v. Shelby County, Tennessee
Hohenberg and Hanson failed to maintain their Memphis homes. The Environmental Court, a local court that hears cases involving alleged violations of county ordinances, including environmental ordinances, declared Hohenberg’s home a public nuisance and ordered remediation. Hohenberg eventually declared bankruptcy. Her house was auctioned off, mooting the enforcement action. The court found Hanson guilty of code violations and ordered remediations. The violations recurred; Hanson went to jail. The city bulldozed his house. The court dismissed his case as moot.Each homeowner filed a 42 U.S.C. 1983 action against the court and the county. They claimed that the court’s procedures, including failures to use Tennessee’s Civil and Evidence Rules, to keep complete records, and to consider constitutional claims or defenses, violated their due process rights. The county created, funded, and “fail[ed] to oversee” the court. The district court dismissed their complaint as amounting to improper appeals of state court judgments (28 U.S.C. 1257(a)).The Sixth Circuit reversed the jurisdictional ruling but affirmed in part. The injuries do not stem from state-court “judgments.” The plaintiffs mainly argued that the Environmental Court dragged out the proceedings and complicated them, targeting ancillary litigation expenses rather than the application of law to fact, outside section 1257(a)’s limited orbit. Damages would not amount to the “review and rejection” of any judgments binding the plaintiffs. Because the Environmental Court is not a “person” but an arm of the state, the Section 1983 action against it fails. View "Hohenberg v. Shelby County, Tennessee" on Justia Law
Appalachian Regional Healthcare v. U.S. Nursing Corp.
Appalachian runs Whitesburg Hospital. In 2007, Hospital nurses went on strike. Appalachian entered into an agreement, under which Nursing provided nurses and agreed to indemnify and defend Appalachian for the negligence of any of its employees assigned to the Hospital.Profitt, injured at work, was taken by fellow employees to the Hospital. Profitt alleged that his injuries were exacerbated by a nurse who moved him from the car without stabilizing and immobilizing him. Nurses Hurt and Parsons, Appalachian's employees, were dismissed from the suit, based on the lack of evidence that either was the nurse in question. Nurse Foote, a Nursing employee, remained. In a settlement, Appalachian paid Profitt $2 million and incurred $823,522.71 in legal fees and costs.In an ensuing indemnity lawsuit, Appalachian requested that the court preclude testimony that Hurt or Parsons transported Profitt into the ER. Nursing did not address Appalachian’s issue preclusion argument but argued that the alleged conduct of the unknown female, was not a breach of the standard of care nor did it cause an injury. The court granted the motion. A jury ruled in favor of Appalachian.The Sixth Circuit affirmed. The district court erred in giving preclusive effect to the state court’s ruling; Nursing did not have a full and fair opportunity to litigate this issue at the state court level. However, the relevant evidence was not “closely balanced” but clearly identified Nurse Foote. View "Appalachian Regional Healthcare v. U.S. Nursing Corp." on Justia Law