Justia Class Action Opinion Summaries

by
Scott alleged that Westlake repeatedly called her cell phone using an automated dialer in violation of the Telephone Consumer Protection Act, 47 U.S.C. 227, and sought, for herself and a putative class, statutory damages of $500 for each negligent violation and $1500 for each intentional violation, injunctive relief, and attorney fees. Before she moved for class certification, Westlake sent Scott’s attorney an offer to pay Scott $1500 (the statutory maximum) “for each and every dialer-generated telephone call made to plaintiff.” Westlake agreed to pay costs and to entry of an injunction. The message concluded by warning Scott that, in Westlake’s opinion, its offer rendered her case moot. The next day, Scott moved for class certification and declined the offer, stating that there was “a significant controversy” concerning how many dialer-generated calls Westlake had placed to her phone, so the offer was inadequate and did not render her case moot. The district court dismissed, finding that Westlake had offered Scott everything she sought, depriving the court of subject matter jurisdiction, but retained jurisdiction to enforce compliance with the offer and directed the parties to conduct discovery to determine how many calls Scott received from Westlake. The Seventh Circuit reversed, finding that the case is not moot. View "Scott v. Westlake Servs., LLC" on Justia Law

by
Beginning in 1998, consumer class actions were filed against Trans Union alleging violation of the Fair Credit Reporting Act, 15 U.S.C. 1681, by selling consumer information to target marketers and credit and insurance companies. The court approved a settlement. Trans Union agreed to give all class members “basic” credit monitoring services. Class members could also either claim cash from a $75 million fund or claim “enhanced” in-kind relief consisting of additional financial services. Trans Union was to provide $35 million worth of enhanced relief. The class was estimated at 190 million people. The Act authorizes damages of between $100 and $1000 per consumer for willful violations, so Trans Union faced theoretically possible liability of $190 billion. To persuade the court to approve the settlement, the parties agreed to an unusual provision that preserved substantive claims after settlement. Instead of releasing their claims, class members who did not get cash or enhanced in-kind relief retained the right to bring individual claims. Trans Union also partially waived the limitations period. The settlement authorized reimbursements from the fund to Trans Union itself “equal to any amounts paid to satisfy settlements or judgments arising from Post-Settlement Claims,” not including defense costs. There have been more PSCs than expected, depleting the fund. In a second appeal, the Seventh Circuit affirmed the orders authorizing disbursement of the remainder of the fund. View "Wheelahan v. Trans Union LLC" on Justia Law

by
About 150 property owners in a village near the Mississippi River claim that defendants’ refinery leaked benzene and other contaminants into the groundwater. They sued, alleging nuisance and related torts. The district court certified the class. The Seventh Circuit reversed. The court first rejected an argument that most class members had suffered no injury. How many class members have a valid claim is determined after certification. Predominance of issues common to all class members, like other certification requirements, goes to the efficiency of a class action as an alternative to individual suits. In this case, the alleged contamination occurred over a 90‐year period and involved different levels of contamination, caused by different polluters. Not every class member has experienced the same diminution in property value even if everyone had the same level of contamination. Plaintiff’s hydrogeologist, intended to measure contamination by the benzene levels in the groundwater beneath the plaintiffs’ properties, even though their water does not come from groundwater, but from an uncontaminated aquifer. It cannot be assumed that a decline in the value of property in the village is the result of proximity to a refinery. The district judge did not explore any of these issues, but treated predominance as a pleading requirement. View "Shell Oil Co. v. Parko" on Justia Law

by
The district court certified a class of waiters, bartenders, and other tipped employees at defendant restaurants. Under the Fair Labor Standards Act, 29 U.S.C. 203(d), and the Illinois Minimum Wage Law their employer is not required to pay tipped employees full federal or state minimum wage. If tipped employees also perform unrelated non‐tipped duties such as washing dishes, preparing food, or cleaning bathrooms, they are entitled to full minimum wage for time spent at that work. After the court amended the class definition to employees “who worked as tipped employees earning a sub‐minimum, tip credit wage rate,” the last remaining defendant sought permission to appeal for a second time. The Seventh Circuit denied the petition. While the definition is overinclusive because it says nothing about untipped work, the defendant did not challenge the definition. The change to the definition since denial of the previous petition does not open the door to a challenge to the initial grant of class certification on grounds derived from developments since that grant, including rulings by the district court. To justify a second appeal from grant or denial of class certification the order appealed from must have materially altered a previous order granting or denying certification. View "Smith v. Driver" on Justia Law

by
The Class Action Fairness Act of 2005 (CAFA) lowers diversity jurisdiction requirements in class actions and in mass actions, i.e., civil actions “in which monetary relief claims of 100 or more persons are proposed to be tried jointly on the ground that the plaintiffs’ claims involve common questions of law or fact,” 28 U.S.C. 1332(d)(11)(B)(i). Mississippi sued LCD manufacturers in state court, alleging violations of state law and seeking restitution for LCD purchases made by itself and its citizens. Following removal, the district court held that the suit qualified as a mass action, but remanded to state court on the ground that it fell within CAFA’s “general public” exception, section 1332(d)(11)(B)(ii)(III). The Fifth Circuit reversed. The Supreme Court reversed. Because Mississippi is the only named plaintiff, the suit does not constitute a mass action under CAFA. The phrase “100 or more persons” does not encompass unnamed persons who are real parties in interest to claims brought by named plaintiffs. The Court stated that it is difficult to imagine how the “claims of 100 or more” unnamed individuals could be “proposed to be tried jointly on the ground that the...claims” of some completely different group of named plaintiffs “involve common questions of law or fact.” Had Congress wanted CAFA to authorize removal of representative actions brought by states as sole plaintiffs, it would have done so through the class action provision, not the mass action provision. View "Mississippi ex rel. Hood v. AU Optronics Corp." on Justia Law

by
The claims on appeal relate to the 2010 explosion aboard the "Deepwater Horizon," an offshore drilling rig, and the consequent discharge of oil into the Gulf of Mexico. This is an interlocutory appeal from the district court's order certifying a class action and approving a settlement under Federal Rule of Civil Procedure 23. The court concluded that the district court was correct to conclude that the applicable requirements of Rule 23 were satisfied in this case. Whether or not BP's arguments regarding Exhibits 4B and 4C were correct as a matter of contract interpretation, neither class certification nor settlement approval were contrary to Article III in this case. Accordingly, the court affirmed the district court's order. View "In Re: Deepwater Horizon, et al." on Justia Law

by
Plaintiff, an Arkansas Circuit Clerk, filed suit against Lenders, alleging that they used the Mortgage Electronic Registration System (MERS) to avoid paying recording fees on mortgage assignments and deprived Arkansas counties of revenue. On appeal, plaintiff challenged the district court's exercise of jurisdiction under the Class Action Fairness Act of 2005 (CAFA), 28 U.S.C. 1332(d). The court concluded that the district court properly found that plaintiff alleged a class action under CAFA and that the class for the illegal-exaction claim included all Arkansas taxpayers, and thus, properly exercised jurisdiction under CAFA; the district court did not err in refusing to dismiss or remand the state-law claims after dismissing the illegal-exaction class action claim; the district court did not abuse its discretion in declining to abstain under Burford abstention; and the dismissal of the state law claims was appropriate under Rule 12(b)(6). Accordingly, the court affirmed the judgment of the district court. View "Brown v. Mortgage Electronic, et al." on Justia Law

by
Plaintiffs filed a class action suit against B&B and others, alleging violations of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. 1962. The alleged scheme involved "Population Equivalents" (PEs), specified quantities of sewage that a house or other building was estimated to dump into the local sewage system. The complaint alleged that B&B had improperly taken control of the Wasco Sanitary District and used that control to divert to itself permit fees that should have gone to the district to finance an expansion of its sewage system. The district court dismissed the claim for want of RICO standing because plaintiffs could not demonstrate an injury to their business or property. On appeal, defendants challenged the district court's denial of their application for an award of attorneys' fees under Fed. R. Civ. P. 11(b)(1) and (2). The court concluded that plaintiffs' suit, while meritless, was not frivolous. Accordingly, the court affirmed the judgment of the district court. View "Fiala, et al. v. B&B Enterprises, et al." on Justia Law

by
Plaintiffs filed suit in state court alleging that Quicken Loans originated unlawful loans in West Virginia and that Defendant Appraisers, which included both the named appraisers and the unnamed class of appraisers, were complicit in the scheme. Quicken Loans removed to federal court under the Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d). The district court then granted plaintiffs' motion to remand to state court under the local controversy exception. Quicken Loans appealed. The court vacated and remanded for a determination by the district court as to whether the named defendant appraisers satisfied the "at least 1 defendant" requirement of the local controversy exception. View "Quicken Loans Inc. v. Alig" on Justia Law

by
In 1994, Norem purchased a “Flexible Premium Variable Life Insurance Policy” from Lincoln Benefit. With variable life insurance, part of the premium is allocated to the insurer’s investment funds, called subaccounts. Policyholders may move their investments within the subaccounts and the death benefit, which is guaranteed not to fall below a certain amount. With variable universal life, the policyholder may easily invest and alter insurance coverage. The policy is comprised of the policy value, which represents the investment component, and its net amount at risk, which represents the insurance component. Norem purchased his policy because he wanted both life insurance and an investment vehicle for the proceeds from the sale of his ownership of a medical business. The policy has a “cost of insurance” (COI) charge deducted monthly from the policy. The policy explains how the COI rate is calculated. Norem filed a putative class action on behalf of himself and other similarly situated policyholders, claiming that Lincoln Benefit breached the terms of its policies in its method of calculating the COI rate.Before deciding on class certification, the district court granted summary judgment to Lincoln Benefit, concluding that its calculation of COI rates did not breach the contract. The Seventh Circuit affirmed. View "Norem v. Lincoln Benefit Life Co." on Justia Law