Justia Class Action Opinion SummariesArticles Posted in US Court of Appeals for the Eleventh Circuit
Fox v. The Ritz-Carlton Hotel Company, LLC
Plaintiff, on behalf of himself and individually, filed a class action alleging that the Ritz-Carlton violated the Florida Deceptive and Unfair Trade Practices Act and Florida's tax regulations. Plaintiff's complaint stemmed from allegations that he and others paid illegal automatic gratuities and sales taxes at Ritz-Carlton’s forty-nine restaurants in Florida over the last four years. The district court dismissed the complaint for lack of subject matter jurisdiction based on lack of standing. The district court also dismissed the tax refund claim for lack of subject matter jurisdiction based on plaintiff's failure to exhaust his administrative remedies.The Eleventh Circuit affirmed the dismissal of the tax refund claim based on exhaustion grounds. However, the court held that the district court erred in finding that plaintiff did not have standing to represent the class because he only paid the illegal automatic gratuity at three of Ritz-Carlton's restaurants. The court agreed with plaintiff that the class complaint alleged in good faith that the amount-in-controversy for the hundreds of thousands of Ritz-Carlton guests in Florida that unlawfully paid an automatic gratuity over the last four years exceeded $5 million. Accordingly, the court reversed in part and remanded for further proceedings. View "Fox v. The Ritz-Carlton Hotel Company, LLC" on Justia Law
Johnson v. NPAS Solutions, LLC
The Eleventh Circuit held that the district court, in approving the class action settlement underlying this appeal, repeated several errors that have become commonplace in everyday class action practice. First, the district court violated the plain terms of Federal Rule of Civil Procedure 23(h) by setting a schedule that required class members to file any objection to the settlement—including any objection pertaining to attorneys' fees—more than two weeks before class counsel had filed their fee petition. However, on the record, the district court's error was harmless. Second, the district court ignored on-point Supreme Court precedent by awarding the class representative a $6,000 incentive payment as acknowledgement of his role in prosecuting the case on behalf of the class members.Finally, in approving class counsel's fee request, overruling objections, and approving the parties' settlement, the district court made no findings or conclusions that might facilitate appellate review. Rather, the district court offered only rote, boilerplate pronouncements ("approved," "overturned," etc.). Therefore, the district court violated the Federal Rules of Civil Procedure and the court's precedents requiring courts to explain their class-related decisions. Accordingly, the court reversed in part, vacated in part, and remanded for the district court to adequately explain its fee award to class counsel, its denial of the interested party's objections, and its approval of the settlement. View "Johnson v. NPAS Solutions, LLC" on Justia Law
Cisneros v. Petland, Inc.
After plaintiff bought a puppy from Petland and the puppy died a week later, plaintiff filed suit under the civil provisions contained in the Racketeer Influenced and Corrupt Organizations Act (RICO), alleging that the puppy's death was the result of a nationwide racketeering conspiracy. Plaintiff alleged that defendants are involved in a conspiracy to sell sick puppies for premium prices and engaged in a campaign of obfuscation after the sale to aid Petland in avoiding its warranties.The Eleventh Circuit affirmed the district court's dismissal of plaintiff's RICO complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). The court held that the complaint failed to plead facts that plausibly support the inference that defendants shared a common purpose to commit the massive fraud she alleges. Furthermore, plaintiff has failed to allege with particularity that each defendant engaged in a pattern of racketeering activity. The court also held that plaintiff adequately alleged in her complaint that the Class Action Fairness Act vested the district court with original jurisdiction over her Georgia RICO claim. Therefore, the court vacated the portion of the district court's order declining to exercise supplemental jurisdiction and remanded with instructions to dismiss plaintiff's state-law RICO claim with prejudice. View "Cisneros v. Petland, Inc." on Justia Law
Freedman v. MajicJack Vocaltec Ltd.
Plaintiff, a shareholder, filed a putative class action complaint against magicJack and eight individuals who were magicJack current or former directors. Plaintiff alleged that magicJack issued two proxy statements that contained material misrepresentations. The district court dismissed plaintiff's lawsuit because his claims were derivative in nature and he failed to plead that he made a demand on magicJack or that doing so would have been futile.The Eleventh Circuit held that federal courts should look to state law to decide the issue of whether a claim brought under a federal statute is direct or derivative. In this case, because magicJack is incorporated under the laws of Israel, Israeli law controls the court's analysis. However, even if the court applied Florida law, the result would be the same because the two bodies of law are consistent. The court held that plaintiff's claims are derivative in nature because he failed to allege that he suffered damages independent of the damages that magicJack (and all of its shareholders) suffered. Furthermore, plaintiff failed to plead that he personally suffered a special injury, distinct from that experienced by magicJack or its other shareholders. Finally, any recovery sought in the Second Amended Complaint would necessarily be for the benefit of magicJack and its shareholders. View "Freedman v. MajicJack Vocaltec Ltd." on Justia Law
Spencer v. Specialty Foundry Products Inc.
Plaintiffs and 229 former workers at the Grede Foundry filed suit against ten entities that manufactured, sold, supplied, and distributed the products they believe harmed them. After defendants removed the case to federal court, the district court granted plaintiffs' motion to remand to state court.The Eleventh Circuit vacated the district court's grant of plaintiffs' motion to remand, holding that the local event exception to the Class Action Fairness Act's grant of federal jurisdiction applies to any continuing set of circumstances in a single location, regardless of when and how the harm came about. The court held that "an event or occurrence" refers to a series of connected, harm-causing incidents that culminate in one event or occurrence giving rise to plaintiffs' claims. In this case, the complaint does not allege a continuous, related course of conduct culminating in one harm-causing event or occurrence, and thus it does not fall within the local event exception. Accordingly, the court remanded for further proceedings. View "Spencer v. Specialty Foundry Products Inc." on Justia Law
Crawford’s Auto Center, Inc. v. State Farm Mutual Automobile Insurance Co.
Two auto body collision repair shops filed a class action against dozens of insurance defendants, alleging claims under the Racketeer Influenced and Corrupt Organizations Act (RICO) and state law fraud and unjust enrichment theories.The Eleventh Circuit affirmed the district court's grant of defendants' motion to dismiss each of plaintiffs' claims. The court held that plaintiffs failed to allege at least two predicate acts of racketeering activity, fraud or extortion. The court also held that plaintiffs have not sufficiently pleaded their state law fraud and unjust enrichment claims; the district court did not err by excluding exhibits E1-E7; and the district court did not err by dismissing the complaint with prejudice. View "Crawford's Auto Center, Inc. v. State Farm Mutual Automobile Insurance Co." on Justia Law
Anderson v. Wilco Life Insurance Co.
The Eleventh Circuit reversed and vacated the district court's order remanding the case to state court after the case was removed to federal district court under the Class Action Fairness Act (CAFA). Because plaintiff sought equitable relief to reinstate a lapsed or surrendered life insurance policy, the court held that the face value of the policy could be used to satisfy the amount-in-controversy requirement, and that the aggregate face value of the life insurance policies here was over $75 million. Therefore, the court held that Wilco has met its burden of proving by a preponderance of the evidence that the amount in controversy exceeds the $5 million CAFA threshold. View "Anderson v. Wilco Life Insurance Co." on Justia Law
Cordoba v. DIRECTV, LLC
Plaintiff filed a class action under the Telephone Consumer Protection Act, alleging that DIRECTV and the company it contracted with to provide telemarketing services, Telecel, failed to maintain the do-not-call list and continued to call individuals who asked not to be contacted.The Eleventh Circuit vacated the district court's certification order, holding that the unnamed members of the putative class who did not ask DIRECTV to stop calling them were not injured by the failure to comply with the regulation. Therefore, their injuries were not fairly traceable to DIRECTV's alleged wrongful conduct, and thus they lacked Article III standing to sue DIRECTV. The court also held that, although the case was justiciable because the named plaintiff had standing, the district court abused its discretion in certifying the class as it is currently defined. In this case, determining whether each class member asked Telecel to stop calling requires an individualized inquiry, and the district court did not consider this problem at all when it determined that issues common to the class predominated over issues individual to each class member. Accordingly, the court remanded for further proceedings. View "Cordoba v. DIRECTV, LLC" on Justia Law
AA Suncoast Chiropractic Clinic, P.A. v. Progressive American Insurance Co.
Three healthcare providers filed a class action against Progressive over a claims-handling process that was allegedly illegal under Florida law. The district court certified an injunction class under Federal Rule of Civil Procedure 23(b)(2), but declined to certify a damages class under Rule 23(b)(3).The Eleventh Circuit held that the district court erred by certifying the injunction class, because the injunctive remedy the class sought -- in this case, damages -- was improper. Therefore, Rule 23(b)(3) is the proper mechanism for certifying a damages class. The court stated that, because plaintiffs' damages claims involved individualized issues that ruled out Rule 23(b)(3) certification, plaintiffs sought to recast their claims as one for injunctive relief under Rule 23(b)(2). View "AA Suncoast Chiropractic Clinic, P.A. v. Progressive American Insurance Co." on Justia Law
Northeastern Engineers Federal Credit Union v. Home Depot, Inc.
The parties appealed the district court's award of attorney's fees in a class action settlement brought by banks against Home Depot to recover resulting losses from a data breach.The Eleventh Circuit held that this was a contractual fee-shifting case, and the constructive common-fund doctrine did not apply. The court held that the district court erred by enhancing class counsel's lodestar based on risk; the district court did not abuse its discretion in compensating class counsel for time on the card-brand recovery process and for time spent finding and vetting class representatives; and there was no merit to Home Depot's contention that the district court's order did not allow for meaningful review. The court also held that the district court properly excluded attorney's fees from the class benefit, and the district court did not abuse its discretion by including the $14.5 million premiums in the class benefit. Accordingly, the court affirmed in part, vacated in part, and remanded. View "Northeastern Engineers Federal Credit Union v. Home Depot, Inc." on Justia Law