Justia Civil Procedure Opinion Summaries

by
Three individuals, including the appellant, formed a limited liability company (LLC) to design and sell firearms products, later adding two more members to a second LLC. The first LLC did not have a formal operating agreement, while the second adopted one in early 2019, setting a low company valuation. The appellant’s behavior became erratic and disruptive, leading to accusations against a key business partner and other members, which damaged business relationships and led to the loss of significant contracts. The remaining members of both LLCs unanimously voted to dissociate the appellant, citing his conduct as making it unlawful to continue business with him. The appellant disputed the validity of the operating agreement in the second LLC and challenged the valuation of his interests in both companies, also alleging wrongful dissociation, defamation, and conversion of property.The Eleventh Judicial District Court, Flathead County, granted summary judgment to the defendants on all claims. The court found the appellant was properly dissociated from the first LLC under Montana’s Limited Liability Company Act due to the unanimous vote and the unlawfulness of continuing business with him. It also held that the second LLC’s operating agreement was valid and permitted dissociation by unanimous vote. The court valued the appellant’s interests according to the operating agreement for the second LLC and based on company assets for the first LLC. The court denied the appellant’s motion to extend expert disclosure deadlines and partially denied his motion to compel discovery. It also granted summary judgment to the defendants on the conversion claim, finding no evidence of unauthorized control over the appellant’s property.The Supreme Court of the State of Montana affirmed the lower court’s rulings on dissociation and valuation regarding the second LLC, as well as the summary judgment on the conversion claim. However, it reversed the valuation of the appellant’s interest in the first LLC, holding that the district court erred by failing to consider the company’s “going concern” value as required by statute. The case was remanded for further proceedings on that issue. View "Herbert v. Shield Arms" on Justia Law

by
A dispute arose over the ownership of real property located at 829 Yale Street in Houston, Texas. In 2019, Nicholas Fugedi, acting as trustee for the Carb Pura Vida Trust, initiated a quiet title action against several defendants. The central issue became whether the trust, and specifically Fugedi’s appointment as trustee, was used as a device to create diversity jurisdiction in federal court, given that Fugedi was a citizen of Michigan while the underlying parties were Texas residents.Initially, the United States District Court for the Southern District of Texas ruled against Fugedi, finding the deed void under Texas law. On appeal, the United States Court of Appeals for the Fifth Circuit reversed that decision but noted that the district court could consider new evidence on remand regarding whether the trust was a sham created to manufacture diversity jurisdiction. On remand, the district court found that Fugedi had been appointed as a sham trustee solely to create diversity jurisdiction, and dismissed the case for lack of subject matter jurisdiction under 28 U.S.C. § 1359.The United States Court of Appeals for the Fifth Circuit reviewed the district court’s dismissal de novo, and its factual findings for clear error. The Fifth Circuit held that 28 U.S.C. § 1359 applies to trusts and that a trust can be used as a device to improperly manufacture diversity jurisdiction. The court found no clear error in the district court’s factual findings that Fugedi was appointed as a sham trustee for the purpose of creating federal jurisdiction. Accordingly, the Fifth Circuit affirmed the district court’s dismissal for lack of subject matter jurisdiction. View "Fugedi v. Initram" on Justia Law

by
A group consisting of a local chapter of a national organization and two individuals challenged certain rules governing public comment at Wilson County Board of Education meetings in Tennessee. The Board’s policies required speakers to disclose their names and addresses, limited comments to certain topics, and included a restriction on “abusive” comments as read by the Chair at meetings. The plaintiffs alleged that these rules deterred them from fully expressing their views, particularly regarding controversial school policies, and that they feared enforcement of the address-disclosure and abusive-comments rules. One plaintiff was stopped from speaking at a meeting for refusing to provide her address.The plaintiffs filed suit in the United States District Court for the Middle District of Tennessee, seeking to enjoin enforcement of three rules: the public-interest provision, the address-disclosure requirement, and the abusive-comments restriction. After the suit was filed, the Board removed the address-disclosure and abusive-comments rules from its policies and meeting materials. The district court denied the plaintiffs’ motion for a preliminary injunction, finding they had not shown a likelihood of success on the merits regarding the public-interest provision, nor a likelihood of imminent and irreparable harm from the other two rules, since they had been rescinded.On appeal, the United States Court of Appeals for the Sixth Circuit affirmed the district court’s denial of a preliminary injunction. The court held that the plaintiffs lacked standing to challenge the public-interest provision because they had not shown a credible threat of its enforcement. As to the address-disclosure and abusive-comments rules, the court found that, because the Board had rescinded these rules and committed not to reinstate them during the litigation, the plaintiffs could not show a likelihood of imminent and irreparable harm necessary for preliminary injunctive relief. The case was remanded for further proceedings. View "Moms For Liberty - Wilson County, Tenn. v. Wilson Cnty. Bd. of Educ." on Justia Law

by
A patent owner brought two infringement lawsuits in the United States District Court for the Western District of Texas against a semiconductor company, alleging that certain integrated circuit products infringed three patents related to electronic circuitry and power-saving features. The accused products included specific chips that allegedly implemented a particular feature. After the lawsuits were filed, the defendant challenged the cases on grounds including improper service, lack of personal jurisdiction, and failure to state a claim. During the litigation, the plaintiff produced a licensing agreement with a third party, and subsequently entered into another agreement covering the accused products. Shortly thereafter, the plaintiff voluntarily dismissed both cases without prejudice.Following the dismissals, the defendant moved for attorneys’ fees, costs, and sanctions, arguing that the lawsuits were baseless. The district court denied the defendant’s motions for attorneys’ fees under 35 U.S.C. § 285, costs under Rule 54(d)(1), and sanctions under Rule 11 and 28 U.S.C. § 1927, but converted the voluntary dismissals to dismissals with prejudice as a sanction. The court also denied the defendant’s discovery requests related to confidentiality and access to certain materials.On appeal, the United States Court of Appeals for the Federal Circuit held that the district court erred in denying fees under § 285 and costs under Rule 54(d)(1), because the defendant became a prevailing party when the dismissals were converted to dismissals with prejudice. The Federal Circuit vacated those portions of the district court’s decision and remanded for further proceedings. The appellate court affirmed the district court’s denial of Rule 11 sanctions and fees under § 1927, finding no abuse of discretion. It also affirmed the denial of the remaining discovery request, concluding that the district court did not abuse its discretion in applying the protective order. The judgment was thus vacated in part, affirmed in part, and remanded. View "FUTURE LINK SYSTEMS, LLC v. REALTEK SEMICONDUCTOR CORPORATION " on Justia Law

by
A plaintiff alleged that, between 1965 and 1969, while he was a young child attending an elementary school in a California school district, he was repeatedly sexually assaulted by the school’s principal. The complaint stated that school staff and faculty were aware or suspected the abuse, and that similar abuse occurred to other students. The plaintiff claimed ongoing psychological and emotional harm as a result. He brought four negligence-based causes of action against the school district, asserting that he was not required to present a government tort claim before filing suit due to statutory changes exempting such claims.The Superior Court of Merced County sustained the school district’s demurrer without leave to amend, dismissing the complaint. The court found that the plaintiff’s failure to comply with the Government Claims Act’s claim presentation requirement was fatal to his case, and concluded that legislative changes extending the statute of limitations for childhood sexual assault did not alter the deadline for filing a claim against a public entity.On appeal, the California Court of Appeal, Fifth Appellate District, reviewed whether Assembly Bill No. 218’s retroactive waiver of the Government Claims Act’s claim presentation requirement for claims under Code of Civil Procedure section 340.1 violated the California Constitution’s gift clause. The appellate court held that the retroactive waiver did not create a new liability or cause of action, but merely removed a procedural barrier to suit. The court further found that the legislative purpose of aiding victims of childhood sexual assault served a valid public purpose and did not constitute an unconstitutional gift of public funds. The judgment of dismissal was reversed and the case remanded for further proceedings. View "Doe R.L. v. Merced City School District" on Justia Law

by
Philip Myers, a native and citizen of Liberia, was adopted by a U.S. citizen and entered the United States as a child. He later sustained several criminal convictions, including for aggravated felonies. In 2021, the Department of Homeland Security initiated removal proceedings against him. Myers claimed derivative citizenship through his adoptive mother, who had become a naturalized U.S. citizen, and also alleged that he had been abused by her. The United States Citizenship and Immigration Services (USCIS) had previously denied his derivative citizenship application, finding insufficient evidence that he was in his adoptive mother’s legal and physical custody at the relevant time. During removal proceedings, Myers, sometimes represented by counsel and sometimes pro se, was found competent to proceed without safeguards. He applied for various forms of relief, including asylum and protection under the Convention Against Torture, but these were denied.The Immigration Judge ordered Myers removed to Liberia. Myers appealed to the Board of Immigration Appeals (BIA), arguing that the competency determination was flawed and that he should have been found incompetent to proceed pro se. The BIA found no clear error in the Immigration Judge’s competency finding and dismissed the appeal. Myers then moved to reopen the proceedings, citing a pending motion with USCIS regarding derivative citizenship, alleged errors in the competency determination, a new asylum claim based on his sexual orientation, and a pending T-visa application as a victim of sex trafficking. The BIA denied the motion to reopen, and Myers was removed to Liberia.The United States Court of Appeals for the Eighth Circuit reviewed the BIA’s denial of the motion to reopen for abuse of discretion and found none. The court also rejected Myers’s constitutional challenge to the statutory requirements for derivative citizenship and found no genuine issue of material fact regarding his nationality claim. The petition for review was denied. View "Myers v. Bondi" on Justia Law

by
In 2019, a well-known advice columnist publicly accused a sitting U.S. president of sexually assaulting her in a department store in 1996. The president, while in office, responded with public statements denying the allegations, asserting he did not know the accuser, and claiming she fabricated the story for personal and political gain. The accuser then filed a defamation lawsuit in New York state court, alleging that these statements were false and damaged her reputation. The case was removed to federal court after the Department of Justice certified that the president acted within the scope of his office, but the DOJ later withdrew this certification. During the litigation, the accuser also brought a separate lawsuit under a new state law allowing survivors of sexual assault to sue regardless of the statute of limitations, which resulted in a jury finding that the president had sexually abused and defamed her after leaving office.The United States District Court for the Southern District of New York granted partial summary judgment for the accuser in the original defamation case, relying on issue preclusion from the verdict in the later case. The trial was limited to damages, and the jury awarded the accuser $83.3 million in compensatory and punitive damages. The president moved for a new trial or remittitur, arguing, among other things, that he was entitled to presidential immunity, that the damages were excessive, and that the jury instructions were erroneous. The district court denied these motions.On appeal, the United States Court of Appeals for the Second Circuit affirmed the district court’s judgment. The court held that the president had waived any claim to absolute presidential immunity by failing to timely assert it, and that the Supreme Court’s intervening decision in Trump v. United States did not alter this conclusion. The court also found no error in the district court’s application of issue preclusion, evidentiary rulings, or jury instructions, and concluded that the damages awarded were reasonable and not excessive. The judgment in favor of the accuser was affirmed in full. View "Carroll v. Trump" on Justia Law

by
The plaintiff brought a lawsuit against the City and County of San Francisco, seeking $5,000,000 in damages for injuries sustained after falling from a scooter that struck a pothole. During discovery, the City sought information about the plaintiff’s intoxication at the time of the incident. The plaintiff’s counsel failed to provide timely and complete responses to certain form interrogatories related to requests for admission about intoxication, despite repeated requests and meet and confer efforts by the City. Additionally, during an independent medical examination, observers chosen by the plaintiff’s attorney interfered with the process, preventing the examining doctor from completing the evaluation.The Superior Court of San Francisco City and County addressed two discovery disputes. First, it granted the City’s motion to compel responses to the interrogatories and imposed a $6,500 sanction against the plaintiff’s counsel for failing to provide timely, code-compliant responses. Second, it imposed a $1,500 sanction after finding that the plaintiff’s observers had improperly interfered with the medical examination. The parties settled the underlying action, but the plaintiff appealed the sanctions. The City moved to dismiss portions of the appeal, arguing that some orders were not appealable and that the sanctions for the medical exam were below the statutory threshold for appeal.The California Court of Appeal, First Appellate District, Division Three, granted the City’s motion to partially dismiss the appeal, finding that the orders regarding the protective order and the $1,500 sanction were not appealable. The court affirmed the $6,500 sanction, holding that the trial court did not abuse its discretion in imposing it, as the plaintiff’s counsel lacked substantial justification for opposing the motion to compel. The appellate court also imposed $30,000 in sanctions against the plaintiff’s counsel for filing a frivolous appeal and referred the matter to the State Bar. View "Morales v. City of San Francisco" on Justia Law

by
Steven Meads and Penny Lipking-Meads operated a business as a sole proprietorship before partnering with Jed Driggers in 2010 to expand the business. The parties formed Afterburner, LLC, with the Meadses and Driggers as members, and Driggers as manager. The Meadses contributed assets and goodwill, while Driggers provided capital and expertise. The LLC’s operating agreement included a provision stating that the LLC could only be dissolved by a vote of the members or bankruptcy/insolvency, and that members agreed not to take any other voluntary action to dissolve the LLC, effectively waiving the right to seek judicial dissolution under certain statutory circumstances.A decade later, the Meadses alleged Driggers had improperly diverted business funds and filed a lawsuit in the Superior Court of Siskiyou County seeking, among other relief, judicial dissolution of the LLC. Driggers and the LLC filed a cross-complaint for breach of contract and breach of fiduciary duty, arguing that the Meadses violated the operating agreement’s waiver provision by seeking dissolution. The Meadses responded with a motion to strike the cross-complaint under California’s anti-SLAPP statute, contending that the waiver provision was unenforceable as contrary to law and public policy. The Superior Court granted the anti-SLAPP motion, finding the cross-complaint arose from protected activity and that Driggers could not show a probability of prevailing.The California Court of Appeal, Third Appellate District, reviewed the case and affirmed the trial court’s order. The appellate court held that, under the Beverly-Killea Limited Liability Company Act, an LLC operating agreement may not waive or vary a member’s statutory right to seek judicial dissolution in the circumstances specified by law. The court concluded that the waiver provision was void and unenforceable, and thus Driggers could not prevail on his cross-complaint. The order striking the cross-complaint was affirmed. View "Meads v. Driggers" on Justia Law

by
A manufacturer of fasteners and related parts entered into a long-term supply agreement with a home appliance company, which later spun off its outdoor products division into a separate entity. The agreement, intended to make the manufacturer the exclusive supplier for a broad range of parts, quickly became the subject of disputes over its scope and the parties’ obligations. The parties attempted to resolve their disagreements through a settlement memorandum and a consent order, but further conflicts arose regarding price increases, performance, and payment for inventory.The United States District Court for the Southern District of Georgia was first asked to interpret the scope of the parties’ agreements. It found the original contract too indefinite to enforce in its entirety but held that subsequent agreements and the parties’ course of performance clarified which parts were covered. The district court also sanctioned the manufacturer for discovery violations, specifically for failing to produce product-level cost data, and struck its lost profits claim. The court denied the manufacturer’s motion for sanctions against the defendants for alleged spoliation, finding the motion untimely and the missing evidence irrelevant. The court granted summary judgment to the defendants on the manufacturer’s price increase claim, finding insufficient evidence to support the requested increases, and denied the manufacturer’s motion to amend its complaint to add a claim for prejudgment interest due to undue delay.On appeal, the United States Court of Appeals for the Eleventh Circuit reviewed each of the manufacturer’s challenges. The court held that the district court properly interpreted the scope of the agreements, did not abuse its discretion in imposing or denying discovery sanctions, correctly granted summary judgment on the price increase claim, and appropriately excluded certain evidence at trial. The Eleventh Circuit affirmed all orders and the final judgment in favor of the defendants. View "Whitesell Corporation v. Husqvarna Outdoor Products, Inc." on Justia Law