Articles Posted in U.S. 6th Circuit Court of Appeals

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Crockett’s former law firm subscribed to a LexisNexis legal research plan that allowed unlimited access to certain databases for a flat fee. Subscribers could access other databases for an additional fee. According to Crockett, LexisNexis indicated that a warning sign would display before a subscriber used a database outside the plan. Years after subscribing, Crockett complained that his firm was being charged additional fees without any warning that it was using a database outside the Plan. LexisNexis insisted on payment of the additional fees. The firm dissolved. Crockett’s new firm entered into a LexisNexis subscription agreement, materially identical to the earlier plan; it contains an arbitration clause. Crockett filed an arbitration demand against LexisNexis on behalf of two putative classes. One class comprised law firms that were charged additional fees. The other comprised clients onto whom such fees were passed. The demand sought damages of more than $500 million. LexisNexis sought a federal court declaration that the agreement did not authorize class arbitration. The district court granted LexisNexis summary judgment. The Sixth Circuit affirmed. “The idea that the arbitration agreement … reflects the intent of anyone but LexisNexis is the purest legal fiction,” but the one-sided adhesive nature of the clause and the absence of a class-action right do not render it unenforceable. The court observed that Westlaw’s contract lacks any arbitration clause. View "Reed Elsevier, Inc. v. Crockett" on Justia Law

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Suits consolidated under 28 U.S.C. 1407 alleged antitrust violations of price fixing and dividing markets by the manufactures of cooling compressors. The district court dismissed the claims of some of the indirect-buyer plaintiffs and declined to enter a final judgment under Civil Rule 54(b) or to certify an interlocutory appeal under 28 U.S.C. 1292. The Sixth Circuit dismissed an appeal for lack of jurisdiction, concluding that the order did not amount to a “final” decision from which the dismissed plaintiffs may appeal. When a single action involves multiple claims or multiple parties, a ruling that disposes of only some claims or only some parties is ordinarily not “final;” the rule is not different for consolidated multi-district cases. View "In re: Refrigerant Compressors Antitrust Litigation" on Justia Law

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In 2010, P&G began marketing Pampers disposable diapers with “Dry Max technology.” Two months later, the Consumer Product Safety Commission began investigating whether the diapers caused severe diaper rash. The district court consolidated several law suits. In August 2010, the CPSC and Health Canada released reports, finding no connection between the diapers and diaper rash. Despite a pending motion to dismiss and before any formal discovery, the parties reached a settlement agreement, under which they agreed to seek class certification under Rule 23(b)(2), so that absent class members could not opt out. P&G agreed: to reinstate a refund program; to add to its label a sentence suggesting that consumers consult Pampers.com or call; to add basic diaper rash information to its website; and to contribute $300,000 to a pediatric resident training program and $100,000 to fund a program “in the area of skin health.” Named plaintiffs would release all of their Pampers-related claims and receive $1000 “per affected child.” Unnamed class members would not receive any award, would benefit only from the one-box refund, but would release “equitable” claims against P&G, and be permanently barred from future class actions against P&G. Class counsel would receive $2.73 million. The district court certified the class. The Sixth Circuit reversed, noting that the per-child payments provided a disincentive for named plaintiffs to care about the adequacy of relief afforded unnamed class members. View "Greenberg v. Procter & Gamble Co." on Justia Law

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Hrivnak filed a purported class action under the Fair Debt Collection Practices Act, 15 U.S.C. 1692–1692p, and Ohio consumer-protection law, Ohio Rev. Code §§ 1345.01–.99, 4165.01–04, seeking statutory, compensatory, and punitive damages exceeding $25,000, and injunctive and declaratory relief. The suit was based on the conduct of debt management companies and a law firm in dunning hi on credit card debts. The defendants made an offer of judgment of $7,000 plus costs and attorney’s fees, under Civil Rule 68. Hrivnak rejected the offer. The district court rejected the defendants’ claim that the offer rendered the suit moot. The Sixth Circuit affirmed, characterizing defendants’ argument as asserting that claims with little to no chance of success should be dismissed as moot whenever they are mixed in with promising claims that a defendant offers to compensate in full. View "Hrivnak v. NCO Portfolio Mgmt., Inc." on Justia Law

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Davis sued Cintas, individually and on behalf of a class of female job applicants denied employment as entry-level sales representatives, alleging that Cintas’s hiring practices led to gender discrimination, in violation of Title VII, and caused Cintas to reject her application for employment twice. The district court denied Davis’s motion for class certification and granted summary judgment for Cintas. The Sixth Circuit affirmed both denial of class certification and the entry of summary judgment on her individual disparate-treatment claim arising in 2004 and her disparate-impact claim. The court reversed with respect to a disparate-treatment claim arising in 2003, noting that she was at least as qualified as the male candidates at that time. View "Davis v. Cintas Corp." on Justia Law

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Plaintiffs receive subsidies from Michigan’s Child Development and Care Program for providing home childcare services for low-income families. Following creation of the Home Based Child Care Council, a union was established and authorized to bargain on their behalf, based on submission of 22,180 valid provider-signed authorization cards out of a possible 40,532 eligible providers. The union and the Council entered into a collective bargaining agreement and the state began deducting union dues and fees from the subsidy payments. Plaintiffs sought to file a class-action lawsuit for the return of the money, collected allegedly in violation of their First Amendment rights. The district court denied certification of plaintiffs’ proposed class (all home childcare providers in Michigan) based on conflict of interest: some members voted for union representation and others voted against representation. Plaintiffs attempted to cure by proposing a subclass of only providers who did not participate in any election related to union representation. The district court rejected the proposal, finding that it could not assume that all members of the subclass opposed representation and that, even if all members of the proposed subclass did oppose representation, their reasons for opposition were different enough to create conflict within the class. The Sixth Circuit affirmed. View "Schlaud v. Snyder" on Justia Law

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The parents and the grandmother of two black children sued the Nashville Board of Public Education on behalf of their children and all black students in the District whose school assignments were adversely affected by the elimination of the mandatory noncontiguous transfer zones. They allege that the Rezoning Plan eliminated the desirable practice of being bused to a good, racially diverse school and replaced it with two inferior choices: staying in a bad, racially isolated neighborhood school or being bused to a bad, racially diverse school. They claim that has led to resegregation in violation of the students’ rights under the Equal Protection Clause. The district court ruled in favor of the Board. The Sixth Circuit affirmed, finding that the change serves legitimate state interests in school under-utilization. The Plan actually solved the problem that many schools were operating at levels below what their resources and infrastructure would permit, while other schools were overflowing. The court stopped short of endorsing the Plan, noting that certain students in poor neighborhoods had to share textbooks; that the racial achievement gap apparently exists much as before; and that Nashville public-school students as a whole continue to do poorly after the Plan. View "Spurlock v. Fox" on Justia Law

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Former employees of AK Steel filed a class action under the Employee Retirement Income Security Act (ERISA), including claims for a “whipsaw” calculation of their benefits from a pension plan in which they participated before terminating their employment. The employees were originally involved in a related class action that included identical claims against the same defendants, but were excluded from that litigation due to their execution of a severance agreement and release that each of them signed during the that litigation. The district court ruled in favor of the employees. The Sixth Circuit reversed an award of prejudgment interest for failure to consider case-specific factors, but otherwise affirmed denial of a motion to dismiss; class certification; and partial summary judgment on liability. The employees’s future pension claims were not released as a matter of law because the whipsaw claims had not accrued at the time of the execution of the severance agreements and because the scope of the contracts did not relate to future ERISA claims. View "Schumacher v. AK Steel Corp." on Justia Law

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Tennessee participates in Medicaid through “TennCare,” Tenn. Code 71-5-102. The Medicaid Act requires that TennCare administer an Early and Periodic Screening, Diagnosis, and Treatment program for all enrollees under age 21, 42 U.S.C. 1396a(a)(43), 1396d(r) and must provide outreach to educate its enrollees about these services. In 1998 plaintiffs filed a putative class action under 42 U.S.C. 1983, alleging that TennCare had failed to fulfill these obligations. The district court entered a consent decree that explained in detail the requirements that TennCare had to meet to “achieve and maintain compliance” with the Medicaid Act, based on the assumption that the Act created rights enforceable under section 1983. Eight years later, the Sixth Circuit held that one part of the Medicaid Act was unenforceable under section 1983. Following a remand, the district court vacated paragraphs of the decree that were based on parts of the Act that are not privately enforceable. After a thorough review of TennCare’s efforts, the court then vacated the entire decree, finding that TennCare had fulfilled the terms of the decree’s sunset clause by reaching a screening percentage greater than 80% and by achieving current, substantial compliance with the rest of the decree. The Sixth Circuit affirmed. View "John B. v.Emkes" on Justia Law

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Plaintiffs and defendants obtained class certification and settlement approval for a nationwide class action involving three related lawsuits, alleging violations of the Fair Debt Collection Practices Act, 15 U.S.C. 1692-1692p and state law, based on the practice of “robo-signing” affidavits in debt collections. Eight individuals objected. The Sixth Circuit reversed, holding that the disparity in the relief afforded under the settlement to the named plaintiffs (exoneration of debts, $2000, and prospective injunctive relief) and the unnamed class members ($17 and prospective injunctive relief) made the settlement unfair. The class notice was inadequate and, although the class satisfies four of the six certification requirements (numerosity, commonality, typicality and predominance), the representation is not adequate under Rule 23(a) nor is the class action vehicle superior. View "Vassalle v. Midland Funding LLC" on Justia Law