This appeal stemmed from a putative securities fraud class action brought by lead plaintiff Nitesh Banker on behalf of all persons who purchased common stock in Gold Resource Corporation (GRC) during the class period between January 30, 2012, and November 8, 2012. GRC, a Colorado corporation, was a publicly traded mining company engaged in Mexico in the exploration and production of precious metals, including gold and silver. GRC’s aggressive business plan called for a dramatic increase in mining production during its initial years. Plaintiff alleged the "El Aguila" project experienced severe production problems during the class period, and that defendants knew about these problems but concealed them from investors. Plaintiff alleged GRC and four of its officers and directors committed securities fraud in violation of federal securities laws. He also asserted claims against individual defendants as "control persons." The district court dismissed the complaint with prejudice pursuant to Fed. R. Civ. P. 12(b)(6), holding that plaintiff failed to meet the heightened pleading standard for scienter required by the Private Securities Litigation Reform Act of 1995. Plaintiff appealed. But finding no reversible error, the Tenth Circuit affirmed. View "In re: Gold Resource Corp." on Justia Law

Sanitary and Improvement District No. 1, Butler County, Nebraska (SID #1) filed two class action lawsuits in Cass County, Nebraska, alleging that various county treasurers unlawfully deducted an incorrect percentage of assessments of municipal improvements collected on behalf of SID #1 and other sanitary and improvement districts. The county treasurers filed motions to dismiss for failure to state a claim. The district court granted those motions, concluding that the sanitary and improvement districts are not municipal corporations and therefore do not create municipal improvements. SID #1 appealed. The Supreme Court consolidated the appeals and reversed, holding that SID #1 stated a cause of action because a sanitary and improvement district can levy municipal taxes and make municipal improvements. Remanded. View "Sanitary & Improvement Dist. No. 1 v. Adamy" on Justia Law

Lewis filed a putative class action complaint for damages for violation of the Credit Card Act, Civ. Code, 1747, alleging that he purchased an alcoholic beverage, using a credit card for the purchase. The clerk requested personal identification information in the form of Lewis’s birth date. Lewis believed he was required to provide that information. The clerk entered Lewis’s birth date into the computerized cash register. Although the store was required by Business and Professions Code section 25660 to verify that a purchaser of alcohol is not under the age of 21, there is no legal requirement that the information be recorded. Most retailers selling alcoholic beverages do not record date of birth information. The store was not contractually obligated to provide personal identifying information in order to complete a credit card transaction. The trial court dismissed and the court of appeal affirmed, acknowledging that the Act prohibits requesting or requiring a purchaser to write any personal identifying information on the credit card transaction form “or otherwise,” and requesting or requiring a purchaser to provide personal identifying information which is recorded upon the credit card transaction form “or otherwise.” The prohibitions do not apply to purchases of alcoholic beverages. View "Lewis v. Jinon Corp." on Justia Law

CMS collects consumer debts, subject to the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692a(6). CMS commences consumer state-court collection actions by filing standard-form complaints that allege, that “more than 90 days have elapsed since the presentation of this claim” to the consumer and seek prejudgment interest and attorney fees “as allowable by law.” When named plaintiffs contested CMS’s complaints, CMS served nearly identical discovery requests seeking disclosure of detailed employment and financial information. Plaintiffs filed a putative class action against CMS and in-house CMS attorneys, claiming that CMS’s standard-form pleadings violate the FDCPA and the Nebraska Consumer Protection Act. In certifying four classes, the district court agreed that the predominant common question was whether the defendants sent each class member standard collection complaints and discovery requests, which violate the FDCPA and NCPA. The four classes consist of persons who received a county court collection complaint or discovery requests seeking to collect a debt “for personal, family, or household purposes,” or had such a collection action pending during the applicable limitations periods. The Eighth Circuit reversed, concluding that the court failed to conduct the “rigorous analysis . . . of what the parties must prove” that FRCP 23 requires. View "Powers v. Credit Mgmt. Servs., Inc." on Justia Law

After the 1998 merger of NationsBank and BankAmerica formed Bank of America, shareholders filed class actions alleging violations of securities laws. The cases were resolved when the court approved a $490 million global settlement, overruling an objection by NationsBank class representative Oetting that allocating $333.2 million to those classes was inadequate because their claims had greater merit than the claims of the BankAmerica Classes. After a 2004 distribution and a court-ordered second distribution of $4.75 million to NationsBank claimants in 2009, $2,440,108.53 remained. In 2012, class counsel for the NationsBank Classes moved to terminate the case with respect to those classes, to award class counsel $98,114.34 in attorneys’ fees for work done after the 2004 distribution and to distribute cy pres the remainder of the “surplus settlement funds” to charities suggested by class counsel. The district court granted the motion over Oetting’s objections and ordered “that the balance of the NationsBank Classes settlement fund shall be distributed cy pres to the Legal Services of Eastern Missouri.” The Eighth Circuit vacated and reversed; a further distribution to the classes is feasible, and LSEM is unrelated to the classes or the litigation and is an inappropriate “next best” cy pres recipient. View "Oetting v. Green Jacobson, P.C." on Justia Law

Plaintiffs filed a putative class action under the Class Action Fairness Act of 2005 (CAFA), 28 U.S.C. 1332(d), against Knight, alleging that Knight misclassified them as independent contractors and asserting other labor law violations. Knight removed to federal court, but the district court granted plaintiffs' motion to remand to state court. The district court concluded that Knight did not meet its burden of proof to establish the amount in controversy because all of Knight's calculations relied on a flawed assumption that all drivers worked 50 weeks a year. The court held in Ibarra v. Manheim Investments, Inc., filed simultaneously with this opinion, that when the defendant relies on a chain of reasoning that includes assumptions to satisfy its burden of proof by a preponderance of the evidence that the amount in controversy exceeds $5 million, the chain of reasoning and its underlying assumptions must be reasonable. Applying Ibarra, the court concluded that because defendants relied on a reasonable chain of logic and presented sufficient evidence to establish that the amount in controversy exceeds $5 million, defendants have met their burden of proof. Accordingly, the court reversed and remanded for further proceedings. View "LaCross v. Knight Transportation" on Justia Law

Plaintiff filed a putative class action against his former employer, Manheim, alleging violations of the California Labor Code. Manheim removed the case to federal court and the district court remanded to state court, concluding that Manheim's proof of the $5 million amount in controversy requirement was inadequate. At issue was what a defendant seeking removal must produce to prove the amount-in-controversy requirement under the Class Action Fairness Act of 2005 (CAFA), 28 U.S.C. 1332(d), when the complaint does not include a facially apparent amount in controversy or the plaintiff may have understated the true amount in controversy. The court concluded that when " a defendant's assertion of the amount in controversy is challenged... both sides submit proof and the court decides, by a preponderance of the evidence, whether the amount-in-controversy requirement has been satisfied." A damages assessment may require a chain of reasoning that includes assumptions and such assumptions must be based on reasonable ground. Because the complaint does not allege that Manheim universally, on each and every shift, violates labor laws by not giving rest and meal breaks, Manheim bears the burden to show that its estimated amount in controversy relied on reasonable assumptions. A remand is necessary to allow both sides to submit evidence related to the contested amount in controversy. Therefore, the court vacated and remanded for further proceedings. View "Ibarra v. Manheim Investment, Inc." on Justia Law

Montano filed a putative class action against Wet Seal, alleging that it failed to offer all required meal and rest periods to its California non-exempt retail employees; failed to provide all regular and overtime pay when due or when employment terminated; and failed to provide accurate semi-monthly itemized wage statements, in violation of the Labor and Business and Professions Codes, Industrial Welfare Commission Wage Order No. 7, and Title 8 of the California Code of Regulations. She included a representative claim under the Private Attorneys General Act. Montano propounded discovery requests and Wet Seal responded with objections but no substantive information. Montano moved to compel discovery responses. Before the hearing, Wet Seal moved to compel arbitration of Montano’s individual claims and to stay the action pending completion of arbitration, based on a “Mutual Agreement to Arbitrate Claims." The trial court ultimately denied the motion for arbitration and granted the discovery motion. The court of appeal affirmed. View "Montano v. Wet Seal Retail, Inc." on Justia Law

The Special Management Unit housing unit within the Lewisburg U.S. Penitentiary houses inmates identified as having violent tendencies or having a history of gang involvement while incarcerated. Inmates assigned to the SMU are confined to their cells for 23 hours a day, but can spend the remaining hour in a recreation cage. When first assigned to the SMU, inmates are interviewed by prison officials to ensure that inmates who may be hostile to each other are not housed in the same cell. Shelton, a USP inmate, filed a purported class action, alleging that the defendants have engaged in a pattern, practice, or policy of improperly placing inmates who are known to be hostile to each other in the same cell. He also claims that the defendants fail to intervene when the predictable inmate-on-inmate violence erupts, and that defendants improperly restrain inmates who refuse cell assignments with inmates who are known to be hostile to them. The district court denied Shelton’s motion for class certification and granted defendants’ motion for summary judgment. The Third Circuit affirmed dismissal of a Federal Tort Claims Act claim, but vacated the denial of class certification and summary judgment as to an Eighth Amendment claim. View "Shelton v. Bledsoe" on Justia Law

Sarun, uninsured when he received emergency services from a hospital owned by Dignity Health, signed an agreement to pay the "full charges, unless other discounts apply.” The agreement explained uninsured patients might qualify for government aid or financial assistance from Dignity. After receiving an invoice for $23,487.90, which reflected a $7,871 “uninsured discount,” and without applying for any other discount or financial assistance, Sarun filed a putative class action, asserting unfair or deceptive business practices (Business and Professions Code 17200) and violation of the Consumers Legal Remedies Act (Civ. Code, 1750). The complaint alleged that: Dignity failed to disclose uninsured patients would be required to pay several times more than others receiving the same services, the charges on the invoice were not readily discernable from the agreement, and the charges exceeded the reasonable value of the services. The trial court dismissed, finding that Sarun had not adequately alleged “actual injury.” The court of appeal reversed. Dignity’s argument Sarun was required to apply for financial assistance to allege injury in fact would be akin to requiring Sarun to mitigate damages as a precondition to suit. Mitigation might diminish recovery, butt does not diminish the party’s interest in proving entitlement to recovery. View "Sarun v. Dignity Health" on Justia Law