Justia Class Action Opinion Summaries

Articles Posted in US Court of Appeals for the Fourth Circuit
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Plaintiff, a chiropractic office, filed suit under the Telephone Consumer Protection Act after it received an unsolicited fax offering a free eBook with information about prescription drugs. The district court dismissed its complaint, holding that the plaintiff had not alleged that the fax, which tendered a product for free rather than for sale, was sufficiently commercial to bring it within the statutory prohibition on “unsolicited advertisements.” On appeal, Defendant-PDR Network defends both steps in the district court’s reasoning, arguing that a fax must be “commercial” to qualify as an “advertisement” under the TCPA and that Carlton & Harris has not alleged the requisite commercial character. Carlton & Harris disputes both portions of the court’s reasoning, contending that a prohibited “advertisement” may be entirely non-commercial and that, in any event, it has adequately alleged that the fax it received was commercial in nature. Further, Plaintiff asserts that PDR Network profits when its fax persuades a medical practitioner to accept the proffered eBook.   The Fourth Circuit vacated the district court’s order and remanded. The court concluded that Plaintiff had adequately alleged that the fax offer had the necessary commercial character to make it an “unsolicited advertisement” under the Act. The court explained that for present purposes, we accept as true Plaintiff’s commission allegation and find it adequate, at this preliminary stage, to state a claim that the fax offer of a free eBook is a commercial “advertisement” subject to the TCPA. View "Carlton & Harris Chiropractic, Inc. v. PDR Network, LLC" on Justia Law

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In November 2018, Marriott International, Inc., announced that hackers had breached one of its guest reservation databases, giving them access to millions of guest records. Customers across the country began filing lawsuits, which were consolidated into multidistrict litigation in Maryland. Plaintiffs then moved to certify multiple class actions against Marriott and Accenture LLP, an IT service provider that managed the database at issue. The district court obliged in part. It certified classes for monetary damages on breach of contract and statutory consumer-protection claims against Marriott under Rule 23(b)(3) of the Federal Rules of Civil Procedure. It also certified “issue” classes on negligence claims against Marriott and Accenture under Rule 23(c)(4), limited to a subset of issues bearing on liability.   The Fourth Circuit granted Defendants’ petitions to appeal the district court’s certification order and now concludes that the order must be vacated. The court found that the district court erred in certifying damages classes against Marriott without first considering the effect of a class action waiver signed by all putative class members. And because the existence of damages classes against Marriott was a critical predicate for the district court’s decision to certify the negligence issue classes, that error affects the whole of the certification order. Accordingly, the court vacated the district court’s certification order. View "Peter Maldini v. Accenture LLP" on Justia Law

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This case arose when two companies merged in the biopharmaceutical market. Biopharmaceutical companies develop medicines from living cells. Those medicines must be tested and then approved by the Food and Drug Administration before they can be publicly marketed. The two companies here—INC Research Holdings, Inc. and inVentiv Health, Inc.—did not develop their own medicines, but helped other companies that did. Pre-merger, INC Research specialized in assisting biopharmaceutical companies conduct clinical trials as part of the Food and Drug Administration’s approval process. Wanting to break into the approved-drugcommercialization market, INC Research sought to merge with inVentiv in 2017. Plaintiffs claim that they relied on allegedly misleading statements that INC Research and its executives made in three different communications: (1) the press release announcing the merger; (2) an earnings call held on May 10; and (3) an earnings call held on July 27. The district court dismissed Plaintiffs’ case for failure to state a claim.   The Fourth Circuit affirmed. The court explained that INC Research’s investors have a right to be disappointed that their company’s performance did not meet its optimistic projections. But that does not mean that they also have a right to civil remedies under federal securities law. Securities fraud liability cannot be “predicated solely on an overly optimistic view of a future which may, in fact, encounter harsh economic realities down the road.” View "San Antonio Fire & Police Pension Fund v. Syneos Health Inc." on Justia Law

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Along with her husband, Plaintiff initiated a civil action against Ethicon, Inc. — the manufacturer and seller of the TVT mesh — and its parent company, Johnson & Johnson. Plaintiffs pursued numerous claims for relief, including a strict product liability claim alleging a design defect in the TVT, as well as a claim for negligent design thereof. Plaintiff’s husband joined in the lawsuit by suing for loss of consortium. Plaintiffs filed their lawsuit in the Southern District of West Virginia as part of a multidistrict litigation captioned (the “MDL”).   The Fourth Circuit availing itself of the privilege afforded by the State of West Virginia through the Uniform Certification of Questions of Law Act requested that the Supreme Court of Appeals of West Virginia exercise its discretion to resolve the following certified question of law:Whether Section 411 of the West Virginia Pattern Jury Instructions for Civil Cases, entitled “Design Defect — Necessity of an Alternative, Feasible Design,” correctly specifies Plaintiff’s burden of proof for a strict liability design defect claim pursued under West Virginia law. More specifically, whether a plaintiff alleging a West Virginia strict liability design defect claim is required to prove the existence of an alternative, feasible product design — existing at the time of the subject product’s manufacture — in order to establish that the product was not reasonably safe for its intended use. And if so, whether the alternative, feasible product design must eliminate the risk of the harm suffered by the plaintiff or whether a reduction of that risk is sufficient. View "Judith Shears v. Ethicon, Inc." on Justia Law

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The Employees’ Retirement System of the City of Baton Rouge and Parish of East Baton Rouge represents the class of persons and entities who acquired shares of common stock in MacroGenics, Inc. (“MacroGenics”) between February 6, 2019, and June 4, 2019 (the “Class Period”). Plaintiffs initiated an action against MacroGenics, its president and CEO, and its senior vice president and CFO (collectively “Defendants”) for alleged violations of sections 10(b) and 20(a) of the Securities Exchange Act of 1934, Securities and Exchange Commission (“SEC”) Rule 10b–5, and sections 11, 12(a), and 15 of the Securities Act of 1933. In their Amended Complaint, Plaintiffs alleged that after purchasing MacroGenics’ stock, they experienced economic harm proximately caused by Defendants’ material misrepresentations, misleading statements, or omissions concerning MacroGenics’ clinical trial drug, Margetuximab. The district court granted Defendants’ motion to dismiss after concluding that Plaintiffs had failed to sufficiently allege any actionable misrepresentations or omissions that would give rise to Defendants’ duty to disclose and that most of Defendants’ statements were also immunized from suit.   The Fourth Circuit affirmed. The court explained that Plaintiffs have failed to demonstrate any materially false, misleading representations or omissions in Defendants’ statements. Because Plaintiffs’ Sections 11 and 12(a)(2) claims are inextricably intertwined with the alleged misstatements and omissions raised under their Exchange Act claims, their Securities Act claims cannot prevail. Further, because Plaintiffs have failed to plead a primary violation of the Securities Act, they have consequently failed to plead a Section 15 violation View "Employees' Retirement System of the City of Baton v. Macrogenics, Inc." on Justia Law

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South Carolina law makes it a crime for elementary and secondary school students to act “disorderly” or in a “boisterous manner,”; use “obscene or profane language”; or “interfere with,” “loiter about,” or “act in an obnoxious manner” in (or sometimes near) a school. Four students who had been referred or charged under the disorderly conduct or disturbing schools laws, and a nonprofit organization that advocates for at-risk youth filed a putative class action challenging both laws as unconstitutionally vague. After denying a motion to dismiss, the district court certified one main class and two subclasses under the Federal Rule of Civil Procedure 23(b)(2). The court held that both laws were unconstitutionally vague as applied to elementary and secondary school students, and it permanently enjoined future enforcement of the disorderly conduct law against those students. South Carolina’s Attorney General—appealed, lodging multiple challenges to the district court’s rulings.   The Fourth Circuit affirmed. The court reasoned that the district court committed no abuse of discretion here—not just because the challenged laws are facially invalid as applied to elementary and secondary school students but also because the subclasses demonstrated ongoing injury by the retention of existing records. A delinquency adjudication under South Carolina law may impair a minor’s future practice of law, application for military service, use of a driver’s license, and educational opportunities. Having concluded the laws may not be constitutionally enforced against South Carolina’s elementary and secondary students, the court saw no reason for allowing such continuing injuries to stand. View "Carolina Youth Action Project v. Alan Wilson" on Justia Law

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In a class-action proceeding related to a lending scheme allegedly designed to circumvent state usury laws, Defendant appealed from three district court rulings that (1) reconsidered prior factual findings based on a new finding that Defendant made misrepresentations that substantially impacted the litigation, (2) found that Plaintiffs—Virginia citizens who took out loans (the “Borrowers”)—did not waive their right to participate in a class-action suit against him, and (3) granted class certification. Defendant argued that the district court violated the mandate rule by making factual findings related to the misrepresentations that contradicted the Fourth Circuit’s holding in the prior appeal and then relying on those factual findings when granting class certification. He also contends that the Borrowers entered into enforceable loan agreements with lending entities in which they waived their right to bring class claims against him. In addition, he asserts that common issues do not predominate so as to permit class treatment in this case.   The Fourth Circuit affirmed. The court concluded that the district court did not violate the mandate rule and that the Borrowers did not waive the right to pursue the resolution of their dispute against him in a class-action proceeding. Finally, the court concluded that the district court did not abuse its discretion in granting class certification because common issues predominate. View "Lula Williams v. Matt Martorello" on Justia Law

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Plaintiff appealed the district court’s dismissal of her putative class action against the West Virginia Parkways Authority, in which she alleges that the Parkways Authority improperly collected fees. And the Parkways Authority appeals the district court’s holding that it was not entitled to sovereign immunity under the United States or West Virginia Constitutions.   Plaintiff relied on the Class Action Fairness Act for jurisdiction. The Fourth Circuit vacated the district court’s judgment and remanded the case remanded to the district court with directions to dismiss without prejudice. The court concluded that here, Section 1332(d)(5)(A) bars jurisdiction under Section 1332(d)(2) of the Class Action Fairness Act. The court explained that the Parkways Authority is the only, and thus “primary,” defendant. And it is a “governmental entity.” The Parkways Authority’s sovereign-immunity claim is strong enough to conclude that the district court “may be foreclosed from ordering relief” against it. So Section 1332(d)(2)’s jurisdictional grant “shall not apply.” Since that is the only provision that Plaintiff relies on to establish jurisdiction over her putative class action, the district court lacked jurisdiction to hear it. View "Blazine Monaco v. WV Parkways Authority" on Justia Law

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Plaintiffs were injured in unspecified accidents and treated by South Carolina health care providers. Seeking to pursue personal injury lawsuits, Plaintiffs requested their medical records from the relevant providers. Those records—and accompanying invoices—were supplied by defendants Ciox Health, LLC and ScanSTAT Technologies LLC, “information management companies” that retrieve medical records from health care providers and transmit them to requesting patients or patient representatives. Claiming the invoiced fees were too high or otherwise illegal, Plaintiffs filed a putative class action against Ciox and ScanSTAT in federal district court.   The district court dismissed the complaint and the Fourth Circuit affirmed. The court explained that South Carolina law gives patients a right to obtain copies of their medical records, while capping the fees “a physician, or other owner” may bill for providing them. However, the statutory obligations at issue apply only to physicians and other owners of medical records, not medical records companies. View "Tammie Thompson v. Ciox Health, LLC" on Justia Law

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Plaintiffs in this class action are a class of all West Virginia citizens who refinanced a total of 2,769 mortgages with Defendant Quicken Loans Inc. (now Rocket Mortgage, LLC) from 2004 to 2009, for whom Quicken Loans obtained appraisals from Defendant appraisal management company Title Source, Inc. (now Amrock Inc.) using a request form that included an estimate of value of the subject property. The district court certified the proposed class and granted summary judgment to Plaintiffs on three claims: unconscionable inducement under West Virginia Code Section 46A-2-121(a)(1); breach of contract; and conspiracy.   Previously the Fourth Circuit concluded that Plaintiffs had standing because all of the class members had paid “for independent appraisals that . . . they never received”. Three months later, the Supreme Court issued its opinion in TransUnion LLC v. Ramirez, which addressed Article III standing in the context of a class-action case. Having considered the parties' submissions, the Fourth Circuit concluded that the district court should apply TransUnion to the facts of this case in the first instance. Accordingly, the court vacated and remanded for further proceedings. View "Phillip Alig v. Rocket Mortgage, LLC" on Justia Law