Justia Civil Procedure Opinion Summaries

Two law firms that represented Plaintiffs in this litigation, Schlichter Bogard & Denton LLP (“SBD”) and Schneider Wallace Cottrell Konecky LLP (“SWCK”), appealed the district court’s order imposing sanctions against them under 28 U.S.C. § 1927. Plaintiffs’ counsel represented individual shareholders and an employee retirement plan in a lawsuit claiming that the investment company, investment adviser, and recordkeeper (collectively “Empower”) servicing their mutual funds charged excessive fees in violation of its fiduciary duties under § 36(b) of the Investment Company Act. Following denial of Empower’s summary judgment and Daubert motions, the case proceeded to a bench trial where the district court ruled in favor of Empower. Thereafter, the court sanctioned Plaintiffs’ counsel for “recklessly pursu[ing] their claims through trial despite the fact that they were lacking in merit” and held SWCK and SBD jointly and severally liable for $1.5 million in Empower’s trial costs, expenses, and attorneys’ fees. After review, the Tenth Circuit concluded the district court abused its discretion and therefore reversed the order imposing sanctions. Accordingly, the Court did not reach the issues of SWCK and SBD’s joint and several liability or the court’s denial of SWCK’s motion to amend the judgment. View "Obeslo, et al. v. Empower Capital, et al." on Justia Law

Explosives manufacturer Dyno Nobel tendered an action to its commercial general liability insurance policyholder, Steadfast Insurance Company (“Steadfast”), after being sued in Missouri for damages caused by the release of a nitric oxide plume from one of its Missouri plants. Steadfast denied the claim based on the insurance policy’s clauses precluding indemnification and defense of pollution-related bodily injury actions. Dyno Nobel thereafter filed an action in Utah state court seeking a declaratory judgment that Steadfast had a duty to indemnify and defend against this action under an endorsement titled “Vermont Changes – Pollution” (“Vermont Endorsement”). Contrary to Coverages A, B, and C in the insurance policy, the Vermont Endorsement would have required Steadfast to defend and indemnify against pollution-related bodily injury claims up to an aggregate amount of $3 million. Steadfast removed the action to federal court, and the federal district court entered judgment for Steadfast, concluding the Vermont Endorsement applied only to claims with a nexus to Vermont. Dyno Nobel appealed. After its review, the Tenth Circuit affirmed, finding the plain language of the insurance contract did not cover Dyno Nobel’s claim in the underlying action. View "Dyno Nobel v. Steadfast Insurance Company" on Justia Law

Plaintiffs Carlie Sherman, Anna Gozun, and Amanda Nash appealed a district court’s denial of class certification in a forced labor action against Trinity Teen Solutions (“Trinity”), a residential treatment center for adolescent girls, and its owners and operators (collectively, “Defendants”). Plaintiffs, now adults, were all sent to Trinity as minors by their parents. Trinity advertised itself as offering a wide range of therapies for troubled adolescent girls in a ranch environment and as taking a "tough love" approach, with its residents living in primitive conditions and working on the ranch as part of their treatment experience. Plaintiffs alleged that, during their residence at Trinity, they were forced to work long hours without pay under threat of serious harm. Plaintiffs filed suit against Defendants, on behalf of themselves and a proposed class of former Trinity residents, bringing three forced labor claims under the Trafficking Victims Protection Reauthorization Act, and sought class certification pursuant to Federal Rule of Civil Procedure 23, proposing a putative class of “Plaintiffs, and all similarly situated persons who received treatment from [Trinity] and were subjected to the provision of ‘agricultural labor.’" The district court denied class certification, concluding Plaintiffs had failed to satisfy Rule 23’s commonality, typicality, and predominance requirements. After review, the Tenth Circuit concluded the district court erred by applying the incorrect legal standard to its analysis of Rule 23(a)’s commonality and typicality requirements and Rule 23(b)(3)’s predominance requirement. Therefore, it vacated the district court’s order denying class certification and remanded this case for further proceedings. View "Sherman, et al. v. Trinity Teen Solutions, et al." on Justia Law

In 2008 Plaintiff Bill Grubb signed an employment agreement with Defendant DXP Enterprises to lead the development and production of horizontal pumps. The agreement recited that the parties intended to create a new company to produce the pumps, and Grubb would own 10%. If the project became a success, Grubb had the right under the employment agreement to require DXP to buy his ownership stake at a price based on the new company’s gross revenue. The project was successful; in March 2019, Grubb gave notice to DXP that he wanted to sell his ownership stake in accordance with the agreement. But DXP informed Grubb it had never formed the new company, so there was nothing for it to purchase under the agreement. Grubb brought this action in the United States District Court for the Northern District of Oklahoma against DXP, asserting claims for breach of contract, actual and constructive fraud, conversion, breach of fiduciary duty, and unjust enrichment; and sought a declaratory judgment. After the parties filed cross-motions for summary judgment, the district court granted summary judgment in favor of DXP on all claims. Grubb appealed. After review, the Tenth Circuit found sufficient evidence of bad faith by DXP (in failing to form the new company) to support Grubb’s breach-of-contract claim but otherwise found no error in the rulings by the district court. Accordingly, the Court reversed in part the judgment below and remanded for further proceedings. View "Grubb v. DXP Enterprises" on Justia Law

Randy Quint, John Linn, and Mark Molina (“Colorado Plaintiffs”) filed a class and collective action against Vail Resorts, Inc. alleging violations of federal and state labor laws (“Colorado Action”). Different plaintiffs filed similar lawsuits against a Vail subsidiary, which were pending in federal and state courts in California. After Vail gave notice that it had agreed to a nationwide settlement with some of the other plaintiffs, Colorado Plaintiffs filed an emergency motion asking the district court to enjoin Vail from consummating the settlement. The district court denied their motion, and Colorado Plaintiffs filed this interlocutory appeal, arguing the district court erred by: (1) applying the wrong standard in reviewing the report and recommendation ("R&R"); (2) holding the Anti-Injunction Act applied to an injunction against Vail rather than the state court; (3) declining to consider one exception to the Anti-Injunction Act; (4) holding a second exception to the Anti-Injunction Act did not apply; (5) failing to enforce the first-to-file rule; and (6) abstaining under the Colorado River doctrine. Finding no reversible error, the Tenth Circuit affirmed. View "Quint, et al. v. Vail Resorts" on Justia Law

When he discovered his copyrighted book and song online, Plaintiff Russell Greer sent a “takedown notice” to Defendants Joshua Moon and his website Kiwi Farms, requesting the material be removed from the Kiwi Farms site. When Moon refused, Greer sued Defendants for copyright infringement. The district court granted Defendants’ motion to dismiss, concluding Greer failed to state a claim. On appeal, Greer argued his pro se complaint, construed liberally, adequately “alleged facts demonstrating [Moon and Kiwi Farms] had knowingly induced, encouraged, and materially contributed to direct infringements,” and so “stated a claim for contributory copyright infringement” sufficient to survive a motion to dismiss. The Tenth Circuit agreed, reversed the district court and remanded the case for further proceedings. View "Greer v. Moon, et al." on Justia Law

Plaintiff Van Sant & Co. (Van Sant) owned and operated a mobile home park in Calhan, Colorado, for a number of years. In 2018, Van Sant began to publicly explore the possibility of converting its mobile home park to an RV park. In October 2018, Calhan adopted an ordinance that imposed regulations on the development of new RV parks, but also included a grandfather clause that effectively exempted the two existing RV parks in Calhan, one of which was connected to the grandparents of two members of Calhan’s Board of Trustees (Board) who voted in favor of the new RV park regulations. Van Sant subsequently filed suit against Calhan, several members of its Board, the owners of one of the existing RV parks, and other related individuals. asserting antitrust claims under the Sherman Act, as well as substantive due process and equal protection claims under 42 U.S.C. § 1983. The defendants successfully moved for summary judgment. Van Sant appealed, but finding no reversible error, the Tenth Circuit affirmed. View "Van Sant & Co. v. Town of Calhan, et al." on Justia Law

Plaintiff-appellant Melonie Staheli appealed the denial of her application for Social Security disability benefits. She applied for benefits in 2018, alleging disability beginning March 28, 2018. In 2005, an automobile accident caused Staheli to suffer facial damage and other injuries. In March 2015, she suffered a stroke. After the stroke, she reported frequent headaches, memory loss, and vision problems. Medical professionals also diagnosed her with mental health issues including anxiety, depression, bipolar disorder and attention deficit hyperactivity disorder. Psychologists determined her IQ scores fell within the lowest ten percent of the population. Staheli was eventually terminated from her medical records job because she was unable to perform her work duties. She later obtained part-time work, and by the time of her benefits hearing, she was working 20 hours per week. An ALJ determined Staheli was not disabled within the meaning of the Social Security Act. Finding no reversible error in the district court’s acceptance of the ALJ’s judgment, the Tenth Circuit affirmed. View "Staheli v. Commissioner, SSA" on Justia Law

Wyoming Gun Owners, a non-profit gun rights advocacy group, aired a provocative radio ad in the run-up to Wyoming’s 2020 primary election. The ad extolled the pro-gun credentials of one candidate while branding the other as out of touch with Wyoming values. Under Wyoming law, an advertisement that refers to a candidate and advocates for his victory or defeat—or can only be reasonably understood in that way—generally constitutes an electioneering communication. The Wyoming Secretary of State’s Office flagged Wyoming Gun Owners’ advertisement as an electioneering communication. The organization subsequently sued the Secretary of State (and related parties) in federal district court, arguing that various provisions of the Wyoming statute were void for vagueness and that the disclosure scheme was not constitutionally justified. The district court agreed and determined that the disclosure regime failed exacting scrutiny as applied to WyGO and found a provision within the scheme void for vagueness as applied to WyGO. The Secretary appealed the latter two rulings and WyGO cross-appealed the rest. The Tenth Circuit Court of Appeals affirmed the district court on most claims: the disclosure regime failed exacting scrutiny as applied to WyGO for lack of narrow tailoring; and the regime’s requirement that expenditures for speech “related to” candidate campaigns must be disclosed was void for vagueness as applied to WyGO. The district court did, however, erroneously deny WyGO’s request for attorney’s fees under 42 U.S.C. § 1988. The Court reversed and remanded for an accounting of fees. View "Wyoming Gun Owners v. Gray, et al." on Justia Law

Plaintiffs brought two actions against KeyPoint Government Solutions: a collective action under the Fair Labor Standards Act (the FLSA) on behalf of KeyPoint employees nationwide, and a state-law putative class action on behalf of California employees. They alleged KeyPoint violated the FLSA through policies requiring employees to work uncompensated overtime and also violated certain provisions of California’s wage-and-hour laws. On appeal, KeyPoint argued: (1) the district court erred in denying KeyPoint’s motion to compel arbitration of California state-law claims by some California Plaintiffs; and (2) the district court erred in certifying under Fed. R. Civ. P. 23 of the California employee class. After review, the Tenth Circuit Court of Appeal reversed the district court’s denial of KeyPoint’s motion to compel arbitration, vacated the court’s certification of the Rule 23 class, and remanded for further proceedings. "The district court did not distinguish Plaintiffs’ meal- and rest-break claims from Plaintiffs’ off-the-clock claims. It analyzed only KeyPoint’s allegedly unlawful policy and assumed that the policy could 'prohibit[] Plaintiffs from taking required meal and rest breaks.' This was insufficient. ... The court abused its discretion in failing to perform claim-specific analysis. We vacate the district court’s Rule 23 class certification so that the district court can properly consider predominance." View "Brayman, et al. v. Keypoint Government Solutions" on Justia Law