Justia Class Action Opinion Summaries

Adam saw advertisements for free samples of beauty products, which implied that she need only pay for shipping and handling. Adam ordered two free samples and purchased another item. She was charged $9.94 for shipping and $14.99 for the purchased item. Soon thereafter, Adam was unexpectedly charged $92.94, which resulted in an overdraft of her checking account. A company representative told Adam that “she had agreed" to pay the full amount if she kept the "free samples" and that Adam would need to return the items before refunds could be issued. Adam, not trusting the company, refused to return the items, then called her bank, which temporarily reversed the charge but ultimately reinstated it. Adam contends that her bank was misled by the “false-front scheme” and that the charge would have been reversed but for the defendants’ misrepresentations.Adam filed a putative class-action suit, alleging violations of (or conspiracy to violate or aiding and abetting violation of): multiple California laws; the Electronic Fund Transfer Act, 15 U.S.C. 1693–1693r; the RICO Act, 18 U.S.C. 1961–1968; and consumer laws. The Third Circuit reversed the dismissal of the suit. Adam has standing; she was not made whole by the refund offer; she has neither received a refund nor accepted any alternative. Defendants’ conduct could provide but-for causation for Adam’s financial harm and a restitution order would redress that harm. View "Adam v. Barone" on Justia Law

A 2015 Wired magazine article described a controlled hack of a Jeep Cherokee driven by one of the magazine’s journalists. Cybersecurity researchers exploited a vulnerability in the Jeep’s “uConnect” infotainment system, designed by Harman, for installation in vehicles manufactured by FCA (formerly Chrysler). FCA immediately issued a recall and provided a free software update to patch the vulnerability. Federal regulators supervising the recall determined that the patch eliminated the vulnerability. Other than the Jeep in the Wired test, no other vehicle was successfully hacked.Four plaintiffs sued FCA and Harman on behalf of every consumer who had purchased or leased a 2013–2015 Chrysler vehicle equipped with the uConnect infotainment system, asserting federal and state warranty and consumer-fraud claims. The plaintiffs argued that although the alleged defect never manifested again after the Wired hack, they paid more for their vehicles than they would have if they had known about the cybersecurity vulnerability. After discovery closed, faced with a factual challenge to standing, the plaintiffs failed to provide evidence in support of their claimed overpayment injury.The Seventh Circuit affirmed the dismissal of the case. When litigation moves beyond the pleading stage and Article III standing is challenged as a factual matter, plaintiffs cannot rely on mere allegations of injury; they must provide evidence of a legally cognizable injury in fact. These plaintiffs continued to rely on allegations and legal arguments. View "Flynn v. FCA US LLC" on Justia Law

Appellant American Plan Administrators (“APA”) appealed an order transferring to the Southern District of Florida its motion to quash a third-party subpoena. Appellee South Broward Hospital District (“South Broward”), which obtained the subpoena, moved to dismiss the appeal as taken from a non-final order. APA opposed, arguing that the collateral order doctrine applies to permit our review of the order.   At issue was whether an order transferring a motion to quash a third-party subpoena to the court that issued the subpoena, pursuant to Federal Rule of Civil Procedure 45(f), is immediately appealable under the collateral order doctrine or is instead a non-final order that may be effectively reviewed after final judgment.   The Second Circuit granted Appellee’s motion and dismissed the appeal. The court held that a Rule 45(f) transfer order is non-final and not immediately appealable under the collateral order doctrine because it may be effectively reviewed by the transferee circuit after final judgment. View "Am. Plan Adm'rs v. S. Broward Hosp. Dist." on Justia Law

This fee dispute arises from a putative class-action challenge to a now-repealed Virginia statute that triggered the automatic suspension of the driver’s licenses of “Appellants”, and numerous other Virginia residents for nonpayment of court costs and fines. After Appellants obtained a preliminary injunction, the Virginia General Assembly passed a law repealing the challenged statute. Appellants stipulated that dismissal of the underlying lawsuit was therefore appropriate but claimed that they were nonetheless entitled to attorney’s fees pursuant to 42 U.S.C. Section 1988 because they secured the preliminary injunction.   The district court denied Appellants’ petition for attorney’s fees, citing our decision in Smyth ex rel. Smyth v. Rivero, 282 F.3d 268 (4th Cir. 2002), wherein we held that preliminary injunctions do not confer the requisite “prevailing party” status required for an award of fees pursuant to Section 1988. On appeal, Appellants contend that Smyth is not controlling because it is untenable with subsequent Supreme Court decisions.   The Fourth Circuit affirmed the district court’s denial Appellants' petition for attorney’s fees and litigation expenses. The court held that Smyth remains the law of the Fourth Circuit. And, pursuant to Smyth, Appellants are not prevailing parties. The court explained that it is bound by Smyth because it is directly on point and is neither distinguishable from nor untenable with any Supreme Court decision. The court wrote its decision in Smyth primarily turned on the nature of preliminary injunctions, not the standard for obtaining a preliminary injunction. Thus, Appellants’ argument that Smyth is untenable considering the changed merits standard following Winter is unpersuasive. View "Damian Stinnie v. Richard Holcomb" on Justia Law

In a nationwide class action on behalf of all customers of GLV, which operates in several states as Sports Performance Volleyball Club, the district court certified a class limited to customers of GLV’s Illinois locations. Later, the judge concluded that Mullen, who asserts that GLV committed fraud by failing to disclose allegations of sexual abuse by a coach, was an unsuitable class representative because Mullen had not been injured and invited her to find a substitute. She did not. The class was never decertified.The Seventh Circuit affirmed the rejection of the suit on summary judgment after noting that abstention might have been appropriate. All of the litigants are citizens of Illinois, the claim rests on state law, and the remaining stakes are modest. The sole asserted basis of federal jurisdiction is the Class Action Fairness Act, which applies to class actions with more than 100 class members, stakes exceeding $5 million, and minimal diversity of citizenship. 28 U.S.C. 1332(d)(2). Illinois law requires the plaintiff to show that she was “in some manner, deceived” by misrepresentation or material omission. Mullen was aware of the allegations against the coach. The court noted that the outcome does not bind any other person whose children attended the Club. View "Mullen v. GLV, Inc." on Justia Law

California’s Labor Code Private Attorneys General Act (PAGA) authorizes any “aggrieved employee” to initiate an action against a former employer on behalf of himself and other current or former employees to obtain civil penalties that previously could have been recovered only by California’s Labor and Workforce Development Agency. California precedent holds that a PAGA suit is a “representative action” in which the plaintiff sues as an “agent or proxy” of the state. Moriana filed a PAGA action against her former employer, Viking, alleging multiple violations with respect to herself and other employees. Moriana’s employment contract contained a mandatory arbitration agreement with a “Class Action Waiver,” providing that the parties could not bring any class, collective, or representative action under PAGA, and a severability clause. California courts denied Viking’s motion to compel arbitration.The Supreme Court reversed. The Federal Arbitration Act, 9 U.S.C. 1 (FAA), preempts California precedent that precludes division of PAGA actions into individual and non-individual claims through an agreement to arbitrate. Viking was entitled to compel arbitration of Moriana’s individual claim. Moriana would then lack standing to maintain her non-individual claims in court.A PAGA action asserting multiple violations under California’s Labor Code affecting a range of different employees does not constitute “a single claim.” Nothing in the FAA establishes a categorical rule mandating enforcement of waivers of standing to assert claims on behalf of absent principals. PAGA’s built-in mechanism of claim joinder is in conflict with the FAA. State law cannot condition the enforceability of an agreement to arbitrate on the availability of a procedural mechanism that would permit a party to expand the scope of the anticipated arbitration by introducing claims that the parties did not jointly agree to arbitrate. View "Viking River Cruises, Inc. v. Moriana" on Justia Law

Fox and others failed to pay some of their property taxes. The counties foreclosed on and sold their properties and kept all of the sale proceeds, sometimes tens of thousands of dollars beyond the taxes due. Fox filed this class action. While Fox’s class action was pending, the Michigan Supreme Court held that the counties’ practice violated the Michigan Constitution’s Takings Clause. The Michigan legislature then began crafting a statutory process for recovering the proceeds. ARI then began contacting potential plaintiffs about pursuing relief on their behalf. Meanwhile, the district court certified Fox’s class. ARI instructed the law firm it hired to opt-out ARI-represented claimants and pursue individual relief on their behalf. Fox believed that ARI was improperly soliciting class members.The district court ordered ARI to stop contacting class members and allow 32 class members to back out of their agreements with ARI. The Sixth Circuit affirmed in part. The district court has the authority to protect the class-action process and did not abuse its discretion when it acted to protect class members from ARI’s post-certification communications. While most of the order was justified, the district court abused its discretion by allowing class members who hired ARI before the class was certified to rescind their agreements. View "Fox v. Saginaw County," on Justia Law

Plaintiff filed a putative class action lawsuit against brokerage firm Hornor, Townsend & Kent (“HTK”) and its parent company The Penn Mutual Life Insurance Company. The complaint alleged that HTK breached its fiduciary duties under Georgia law and that Penn Mutual aided and abetted that breach. The district court concluded that the Securities Litigation Uniform Standards Act (“SLUSA”) barred Plaintiff from using a class action to bring those state law claims.   The Eleventh Circuit affirmed the district court’s dismissal. The court explained that SLUSA’s bar applies when “(1) the suit is a ‘covered class action,’ (2) the plaintiffs’ claims are based on state law, (3) one or more ‘covered securities’ has been purchased or sold, and (4) the defendant [allegedly] misrepresented or omitted a material fact ‘in connection with the purchase or sale of such security.’”Here, the only disputed issue is whether Plaintiff’s complaint alleges a misrepresentation or omission. The court reasoned that the district court correctly dismissed the actions because the complaint alleges “an untrue statement or omission of material fact in connection with the purchase or sale of a covered security." View "Jeffrey A. Cochran v. The Penn Mutual Life Insurance Company, et al" on Justia Law

In January 2019, Ali brought this civil rights action against Chicago and several police officers, alleging that the officers followed a city policy “of refusing to release on bond an arrestee taken into custody on an arrest warrant issued by an Illinois state court outside of Cook County.” Days before the deadline for completing fact discovery, Ali moved to certify a class. The district court granted the city’s motion to strike, noting that Ali had not added class allegations to his complaint. Ali sought leave to amend his complaint to include class allegations, arguing that he did not have evidentiary support for the existence of the city policy until a November 2019 deposition. The city replied that it had acknowledged the policy months earlier. The district court denied Ali's motion. Weeks later, Ali settled his case.On January 25, the district court dismissed the case without prejudice. Also on January 25, Miller moved to intervene under Rule 24, asserting that he was a member of Ali’s proposed class. With his motion to intervene pending, Miller filed a notice of appeal from the January 25 order. On March 24, with that appeal pending, the district court denied Miller’s motion to intervene as untimely. The Seventh Circuit affirmed. There was no operative class action complaint. Miller’s motion to intervene was untimely; he is not a party to the lawsuit and cannot pursue other challenges. View "Miller v. City of Chicago" on Justia Law

This putative class action against California and San Diego County officials challenged California Governor Gavin Newsom’s emergency orders and related public health directives restricting business operations during the COVID-19 pandemic. Plaintiffs, owners of affected restaurants and gyms (Owners), primarily contended the orders were procedurally invalid because they were adopted without complying with the Administrative Procedure Act (APA). Furthermore, Owners contended that the business restrictions were substantively invalid because they effected a taking without compensation, violating the Fifth Amendment to the United States Constitution. Rejecting these claims, the superior court sustained demurrers to the third amended complaint without leave to amend and dismissed the action. While the Court of Appeal sympathized with the position some Owners find themselves in and the significant financial losses they alleged, the unambiguous terms of the Emergency Services Act and controlling United States Supreme Court regulatory takings caselaw required that the judgment be affirmed. View "640 Tenth, LP v. Newsom" on Justia Law