Justia Class Action Opinion Summaries

A startup company that produces grain-free pet food filed a class action lawsuit against a major competitor, a traditional pet food company, alleging violations of the Lanham Act for false advertising. The plaintiff claimed that the larger company, whose products contain grain, conspired with veterinarians and two non-profit organizations to falsely associate grain-free pet food with an increased risk of canine heart disease. The complaint described a coordinated marketing campaign, including statements on the defendant’s website, educational materials for veterinarians, and dissemination of information through blogs, media appearances, and social media. The plaintiff asserted these actions were intended to disparage grain-free products and damage its business.The United States District Court for the District of Kansas dismissed the plaintiff’s claims under Federal Rule of Civil Procedure 12(b)(6). The district court found that the plaintiff failed to plausibly allege two required elements for a Lanham Act claim: first, that the challenged statements constituted commercial speech; and second, that the statements were literally false. The court concluded that academic articles and the other challenged statements were not commercial speech, and that the plaintiff had not sufficiently alleged literal falsity. The court also dismissed the related Kansas civil conspiracy claim, as it depended on the Lanham Act violation.On appeal, the United States Court of Appeals for the Tenth Circuit reviewed the dismissal de novo. The appellate court held that the district court erred in part. It found that the plaintiff plausibly alleged that some of the traditional pet food company’s website statements and veterinary educational materials were commercial speech and could be literally false under the establishment claim doctrine. However, it affirmed dismissal regarding statements made by veterinarians and non-profits, finding these were not commercial speech. The court affirmed in part, reversed in part, and remanded for further proceedings. View "KetoNatural Pet Foods v. Hill's Pet Nutrition" on Justia Law

A group of Kansas residential natural gas consumers, who purchase gas from local distributors, sued several interstate wholesalers. They alleged that during Winter Storm Uri, the wholesalers manipulated the market and sold natural gas to local distributors at exorbitant prices, leading to unprecedented increases in retail gas prices. The plaintiffs claimed these actions violated the Kansas Consumer Protection Act (KCPA) by forcing local distributors into the high-priced spot market and passing the excessive costs on to consumers. The plaintiffs contended that even though the alleged misconduct occurred in the wholesale market, it had a direct and significant impact on retail customers.The United States District Court for the District of Kansas consolidated five class actions and reviewed the claims. The district court granted the defendants’ joint motion to dismiss, finding that the Federal Energy Regulatory Commission (FERC) has exclusive jurisdiction over interstate wholesale natural gas rates under the Natural Gas Act (NGA), and that the plaintiffs’ state-law claims were preempted. The court concluded that the challenged conduct concerned wholesale transactions, which are subject to comprehensive federal regulation.The United States Court of Appeals for the Tenth Circuit reviewed the case. It affirmed the district court’s decision, holding that the NGA field-preempts the plaintiffs’ KCPA claims because the claims are aimed directly at, and challenge, transactions and practices in the interstate wholesale natural gas market, an area reserved for federal oversight. The Tenth Circuit distinguished this case from Supreme Court precedent where state-law claims were not preempted, emphasizing that these plaintiffs’ claims targeted wholesale sales rather than background marketplace conditions. The court concluded that the exclusive jurisdiction of FERC over wholesale sales foreclosed state-law consumer protection claims based on those transactions. View "Mehl v. BP Energy Company" on Justia Law

Several individuals who own royalty interests in the Kansas Hugoton Gas Field brought a putative class action against two energy companies. Their claims are based on an alleged breach of a 2008 class action settlement agreement, which had resolved earlier disputes about underpayment of royalties by one of the companies. The 2008 settlement required limits on certain deductions from royalty payments and specified that its terms would bind successors, assigns, and related entities. In 2014, one defendant acquired assets from the other and continued making royalty payments. Plaintiffs allege the acquiring company violated the settlement by taking improper deductions after the acquisition.The plaintiffs initially sought to enforce the settlement in Kansas state court, but the District Court of Stevens County determined the judgment had become dormant and unenforceable. Plaintiffs appealed that ruling, and while the appeal was pending, they filed this federal class action complaint in the United States District Court for the District of Kansas. The district court denied defendants’ motions to dismiss but later denied class certification. The district court found that the proposed class was not ascertainable because identifying class members would require individualized title review and that other Rule 23 requirements were not satisfied.The United States Court of Appeals for the Tenth Circuit reviewed the district court’s decision. The appellate court clarified that, under its recent precedent, class ascertainability does not require administrative feasibility—only an objectively and clearly defined class. The court found the proposed class ascertainable, that common questions predominated, and that the plaintiffs satisfied all Rule 23 requirements. The Tenth Circuit reversed the district court’s denial of class certification and remanded with instructions to certify the putative class. View "Rider v. Oxy USA" on Justia Law

Two plaintiffs who purchased stock in a publicly traded corporation brought a securities class action against the corporation and several of its executives. Their complaint alleged the company embarked on an unusually risky plan to develop a nationwide 5G wireless network using unproven technologies and made materially false or misleading statements concerning the progress and capabilities of the network, anticipated enterprise customer relationships, projected revenue growth, and market demand. The plaintiffs asserted violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 10b-5, claiming the defendants acted with fraudulent intent or recklessness, leading the plaintiffs and other investors to acquire stock at artificially inflated prices.The United States District Court for the District of Colorado reviewed the plaintiffs’ second amended complaint. Defendants moved to dismiss for failure to state a claim, arguing the complaint did not allege any actionable misstatements, facts supporting a strong inference of scienter, or loss causation. The district court agreed, finding that the alleged statements were not false when made and that the complaint lacked particularized facts showing the defendants acted with the required scienter under the heightened pleading standards of Rule 9(b) and the Private Securities Litigation Reform Act (PSLRA). The court dismissed the complaint and entered judgment for the defendants.On appeal, the United States Court of Appeals for the Tenth Circuit affirmed the district court’s decision. The appellate court held that the plaintiffs failed to meet the PSLRA’s requirements to plead with particularity both falsity and scienter for each alleged misstatement. The court also affirmed dismissal of the Section 20(a) claim, as it is derivative of the Section 10(b) claim. The judgment of dismissal was affirmed. View "Lingam v. Dish Network Corporation" on Justia Law

A group of oil-and-gas royalty owners in Oklahoma, represented by Chieftain Royalty Company, sued EnerVest Energy’s predecessor in 2011 for allegedly underpaying royalties. After EnerVest acquired the wells, the parties reached a $52 million settlement in 2015 to be paid to the class after expenses and attorneys’ fees. Class counsel sought 40% of the fund as fees, plus expenses and an incentive award for the class representative. Two class members objected to the fee and incentive awards.The United States District Court for the Western District of Oklahoma approved the settlement, awarding 33.33% of the fund for attorneys’ fees and a 0.5% incentive award. On appeal, the United States Court of Appeals for the Tenth Circuit affirmed the settlement but reversed the fee and incentive awards, holding that Oklahoma law applied and required a lodestar analysis (not solely a percentage-of-the-fund), and that incentive awards must be based on time spent on case-related services. Following remand and a clarifying decision from the Oklahoma Supreme Court in Strack v. Continental Resources, Inc., the district court reapplied the statutory factors, found a 33.33% fee reasonable (supported by a 2.15 lodestar multiplier), and adjusted the incentive award based on the representative’s service. A subsequent Tenth Circuit appeal led to vacatur of the fee award on procedural notice grounds, then the district court reinstated the same fee after proper notice.On this third appeal, the United States Court of Appeals for the Tenth Circuit held that Oklahoma law does not impose a hard ceiling on percentage fees or lodestar multipliers. The district court properly applied Oklahoma’s statutory factors, conducted a thorough reasonableness analysis, and did not abuse its discretion by awarding 33.33% of the fund ($17,333,333.33) as attorneys’ fees. The fee award was affirmed. View "Chieftain Royalty Company v. Enervest Energy Institutional Fund XIII-A" on Justia Law

A hospital district alleged that a medical device manufacturer used its dominant market share in tip-location systems (TLS) for catheters to manipulate the market for peripherally inserted central catheters (PICCs). Bard, the manufacturer, sells PICCs with a proprietary stylet that is necessary to integrate with Bard’s TLS. The hospital claimed this arrangement effectively forced hospitals to buy Bard’s PICCs to use the TLS, resulting in higher prices, and brought suit under the Sherman Act and Clayton Act for unlawful tying and monopolization. The hospital sought class certification for clinics and hospitals that had purchased Bard PICCs.Initially, the United States District Court for the District of Utah granted Bard’s motion for judgment on the pleadings regarding the tying claim, holding that the hospital lacked antitrust standing since it purchased only the tied product (PICCs) and not the tying product (TLS). The court concluded the hospital did not show it was compelled to buy Bard’s PICCs as a result of owning Bard’s TLS. The court allowed the monopolization claim to proceed, but later denied class certification, finding the proposed class did not meet certification requirements. After the Tenth Circuit denied interlocutory review of the class certification denial, the hospital voluntarily dismissed its remaining claim to facilitate an appeal from final judgment.On appeal, the United States Court of Appeals for the Tenth Circuit affirmed the dismissal of the tying claim, holding that the hospital was not an efficient enforcer of the antitrust laws and therefore lacked antitrust standing. The court found that purchasers of the tying product or competitors are generally better positioned to challenge tying arrangements. The Tenth Circuit also dismissed the appeal from denial of class certification, ruling it lacked jurisdiction under circuit and Supreme Court precedent when the underlying claim was voluntarily dismissed. View "North Brevard County Hospital District v. C.R. Bard, Inc." on Justia Law

This case involves a class action dispute over late payments of oil proceeds to royalty and working interest owners in Oklahoma. The plaintiff, an Oklahoma landowner with royalty interests in three oil wells, alleged that Sunoco, Inc. and Sunoco Partners Marketing & Terminals, L.P. failed to pay statutory interest on late payments as required by Oklahoma’s Production Revenue Standards Act (PRSA). The PRSA mandates that first purchasers of oil must pay proceeds within strict timeframes and include 12 percent interest on any late payments. The class was defined to include all owners who received late payments from Sunoco without the required interest.After Sunoco removed the case to the United States District Court for the Eastern District of Oklahoma, the court certified the class in 2019, finding common questions predominated, including whether Sunoco owed interest on untimely payments and whether a demand was required. The district court granted partial summary judgment on liability for the PRSA claim, and after a bench trial, awarded the class over $103 million in actual damages (including prejudgment interest) and $75 million in punitive damages. Sunoco appealed, challenging class certification, standing for certain class members, the calculation of prejudgment interest, and the punitive damages award. The Tenth Circuit previously remanded for clarification on damages allocation for unidentified owners, which the district court addressed.On appeal, the United States Court of Appeals for the Tenth Circuit affirmed the district court’s rulings on class certification, ascertainability, standing, and the award of actual damages including prejudgment interest. The court held that the PRSA requires automatic payment of statutory interest on late payments, and that prejudgment interest should be compounded until paid. However, the Tenth Circuit vacated the punitive damages award, holding that punitive damages are not available for breach of contract claims under Oklahoma law when the only claim proven was a PRSA violation. The case was remanded for amendment of the judgment consistent with this opinion. View "Cline v. Sunoco" on Justia Law

Plaintiffs, C&M Resources, LLC and Winter Oil, LLC, acting on behalf of a putative class of royalty owners, alleged that Extraction Oil and Gas, Inc. underpaid royalties owed under oil and natural gas production agreements. This case is the third attempt by the plaintiffs to pursue these claims, all arising from the same set of facts. In the two prior lawsuits filed in Colorado state court, the trial courts dismissed the complaints for lack of subject matter jurisdiction, finding that the plaintiffs had failed to exhaust administrative remedies before the Colorado Oil and Gas Conservation Commission, as required by statute. The plaintiffs did not appeal those dismissals.In the present case, originally filed in state court in 2019, proceedings were stayed pending the Colorado Supreme Court’s decision in Antero Resources Corp. v. Airport Land Partners, Ltd. After the stay was lifted in 2023 and discovery commenced, Extraction determined that the amount in controversy exceeded $5 million and removed the case to federal court under the Class Action Fairness Act. The plaintiffs moved to remand, arguing that removal was untimely and that Extraction had waived its right to remove by participating in state court litigation. The United States District Court for the District of Colorado denied the remand motion, finding that the removal was timely based on information obtained during discovery and that the bankruptcy proof of claim and other documents from prior cases did not trigger the removal clock.The United States Court of Appeals for the Tenth Circuit reviewed the district court’s decisions. It held that the district court properly denied remand and correctly applied collateral estoppel, precluding the plaintiffs from relitigating the exhaustion requirement. The Tenth Circuit affirmed the district court’s judgment on the pleadings in favor of Extraction, finding no error in the lower court’s rulings. View "C&M Resources v. Extraction Oil and Gas" on Justia Law

Gerald Silver filed a putative class action against the City of Albuquerque, alleging that the City violated the Telephone Consumer Protection Act (TCPA) by making pre-recorded phone calls to invite residents to virtual town hall meetings during the COVID-19 pandemic. Silver claimed he received at least seven such calls on his cell phone. The City argued that it was not subject to the TCPA as it was not a "person" under the statute and that the calls fell under the TCPA’s emergency purposes exception.The United States District Court for the District of New Mexico granted the City’s motion to dismiss, concluding that the calls fell within the emergency purposes exception of the TCPA. The court did not address whether the City was a "person" under the TCPA. Silver appealed the decision.The United States Court of Appeals for the Tenth Circuit reviewed the case de novo and affirmed the district court’s dismissal. The Tenth Circuit held that even assuming the TCPA applies to local governments, Silver’s complaint did not state a claim upon which relief could be granted. The court found that the calls were made by a local government official, were informational, and were made necessary by the COVID-19 pandemic to inform residents about virtual town hall meetings, which were a mitigation measure in response to the pandemic. Therefore, the calls fell within the TCPA’s emergency purposes exception. The court did not need to determine whether local governments qualify as persons under the TCPA. View "Silver v. City of Albuquerque" on Justia Law

Plaintiff-appellee Elizabeth Hammond sought to pursue a class action in New Mexico state court on behalf of everyone in the country who, like her, called to cancel their Stamps.com subscriptions after “discovering” that Stamps.com “was taking money from them” every month. Hammond alleged that this class included “hundreds or thousands of persons.” And while she didn't allege a total damages amount, she contended that she was entitled to $300 in statutory damages and that other members of the proposed class should “likely” receive damages of $31.98, representing two monthly subscription charges ($15.99 x 2), based on her estimate of how long customers could have reasonably failed to notice the monthly charges before calling to cancel. Hammond also sought punitive damages for herself and other class members. Stamps.com sought to remove the case to federal court, presenting uncontested declarations showing that in the last four years, at least 312,680 customers called to cancel their subscriptions. The company observed that, if each of these persons were to win the same $300 in damages Hammond sought for herself, the value of this case would exceed $93 million. And even if other class members could secure only $31.98 in damages, the company noted, the case’s potential value would still lie at almost $10 million. The district court found lack of jurisdiction, holding that Stamps.com failed to meet its burden of showing that over $5 million was "in controversy" because the company failed to disaggregate from the total number of customer cancellations those customers who “felt duped” by Stamps.com’s website disclosures. Disagreeing with the district court's decision it lacked jurisdiction, the Tenth Circuit reversed and remanded for further proceedings. View "Hammond v. Stamps.com" on Justia Law