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This appeal involved the South Carolina Home Builders Self Insurers Fund (Fund), which was created by the Home Builders Association of South Carolina, Inc. "for the purpose of meeting and fulfilling an employer's obligations and liabilities under the South Carolina Workers' Compensation Act." The dispute arose after the Fund's Board of Trustees announced plans to wind down the Fund and use the Fund's remaining assets to finance a new mutual insurance company. Petitioners, who were members of the Fund, disagreed with that decision and challenged the Board's authority to use the Fund's assets in such a way. The trial court twice dismissed Petitioners' suit, first on the basis that it involved the internal affairs of a trust and therefore should have been filed in probate court, then in a subsequent proceeding, on the basis that the lawsuit was a shareholder derivative action and that the complaint failed to comply with the pleading requirements of Rule 23(b)(1), SCRCP. On appeal, the court of appeals affirmed the dismissal of Petitioners' complaint, finding the trial court properly concluded (1) the Fund was not a trust; (2) Petitioners' claims were derivative in nature; and (3) that Petitioners' complaint was properly dismissed as it did not properly allege a pre-suit demand as required by Rule 23(b)(1). The South Carolina Supreme Court reversed and remanded, finding Petitioners satisfied the pleading requirements of Rule 23(b)(1), irrespective of whether the Fund was properly characterized as a trust. View "Patterson v. Witter" on Justia Law

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The First Circuit held that federal law requires prior FDA approval for a manufacturer of prescription eye drops to change the medication’s bottle so as to alter the amount of medication dispensed into the eye, and therefore, state law claims challenging the manufacturers’ refusal to make this change are preempted. Plaintiff sued in federal court on their own behalf and on behalf of a putative class of prescription eye solution purchasers, asserting that Defendants deliberately designed their dispensers to emit unnecessarily large drops. Plaintiffs alleged that Defendants’ practice was “unfair” under Massachusetts state law and twenty-five other states and allied claims for unjust enrichment and for “money had and received.” The district court dismissed the complaint without ruling on the merits, finding that FDA regulations preempted Plaintiffs’ suit. The First Circuit affirmed, holding (1) changing a product bottle so as to dispense a different amount of prescription eye solution is a “major change” under 21 C.F.R. 314.70(b); and (2) therefore, Plaintiffs’ state law claims were preempted. View "Gustavsen v. Alcon Laboratories, Inc." on Justia Law

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In this consolidated action, the Supreme Court held that the trial court did not abuse its discretion in ordering class certification. Plaintiffs, service station operators and franchised dealers for gasoline products supplied by Defendant, a wholesale supplier, commenced this putative class action alleging that the proposed class members had been overcharged. Defendant then commenced a separate action against one of the plaintiffs. In response, that plaintiff filed a counterclaim styled as a proposed class action that mirrored Plaintiffs’ complaint in the earlier action. The trial court solicited the two actions and then allowed the action to proceed as a class action. Defendant appealed from the orders certifying the class. The Supreme Court affirmed, holding that the trial court did not abuse its discretion in ordering class certification. View "Standard Petroleum Co. v. Faugno Acquisition, LLC" on Justia Law

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Matthew Ray, a former DISH Network L.L.C. employee who signed an arbitration agreement when he was employed, filed an action in the federal district court alleging violations of the Fair Labor Standards Act (“FLSA”), Colorado’s Wage Claim Act, Colorado’s Minimum Wage Act, and a common law claim for breach of contract. Dish moved to dismiss, demanding that Ray arbitrate his claims pursuant to the Agreement. Ray dismissed the lawsuit and filed with the American Arbitration Association (“AAA”), asserting the same four claims. In addition, and the focus of this case, Ray attempted to pursue his claims as a class action under Fed. R. Civ. P. 23 and a collective action under 29 U.S.C. 216(b). The arbitrator determined that the Arbitration Agreement between the two parties permitted classwide arbitration, and then stayed the arbitration to permit DISH to contest the issue in court. DISH filed a Petition to Vacate Clause Construction Arbitration Award, which the district court denied. After review, the Tenth Circuit determined the arbitrator in this case did not manifestly disregard Colorado law when he concluded that he was authorized to conduct class arbitration by the broad language of the Agreement in combination with the requirement that arbitration be conducted pursuant to the AAA’s Employment Dispute Rules. Accordingly, the district court correctly denied DISH’s petition to vacate the arbitration award. View "Dish Network v. Ray" on Justia Law

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Washington public school teachers filed a class action to order the Director of DRS to return interest that was allegedly skimmed from their state-managed retirement accounts. The Ninth Circuit reversed the district court's denial of a stipulated motion to certify a class and dismissal of the action as prudentially unripe. The panel held that the district court erred in dismissing the teachers' takings claim as prudentially unripe because DRS's withholding of the interest accrued on the teachers' accounts constitutes a per se taking to which the prudential ripeness test in Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City, 473 U.S. 172 (1985), did not apply. In regard to the Director's alternative grounds for summary judgment, the panel held that plaintiffs stated a takings claim for daily interest withheld by the Director; the panel clarified that the core property right recognized in Schneider v. California Department of Corrections, 151 F.3d 1194 (9th Cir. 1988), covered interest earned daily, even if payable less frequently; plaintiffs' takings claim was not barred by issue preclusion or by the Rooker-Feldman doctrine; and the takings claim was not foreclosed by the Eleventh Amendment. The panel also held that the district court erred in denying the motion for class certification. Accordingly, the panel remanded for further proceedings. View "Fowler v. Guerin" on Justia Law

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In 1999, Native American farmers sued, alleging that the USDA had discriminated against them with respect to farm loans and other benefits. The court certified a class, including LaBatte, a farmer and member of the Sisseton Wahpeton Tribe. Under a settlement, the government would provide a $680 million compensation fund. The Track A claims process was limited to claimants seeking standard payments of $50,000. Track A did not require proof of discrimination. Under Track B, a claimant could seek up to $250,000 by establishing that his treatment by USDA was "less favorable than that accorded a specifically identified, similarly situated white farmer(s),” which could be established “by a credible sworn statement based on personal knowledge by an individual who is not a member of the Claimant’s family.” A "Neutral" would review the record without a hearing; there was no appeal of the decision. LaBatte's Track B claim identified two individuals who had personal knowledge of the USDA’s treatment of similarly-situated white farmers. Both worked for the government's Bureau of Indian Affairs. Before LaBatte could finalize their declarations, the government directed the two not to sign the declarations. The Neutral denied LaBatte’s claim. The Claims Court affirmed the dismissal of LaBatte’s appeal, acknowledging that it had jurisdiction over breach of settlement claims, but concluding that it lacked jurisdiction over LaBatte’s case because LaBatte had, in the Track B process, waived his right to judicial review to challenge the breach of the agreement. The Federal Circuit reversed. There is no language in the agreement that suggests that breach of the agreement would not give rise to a new cause of action. View "LaBatte v. United States" on Justia Law

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Plaintiff appealed the district court's grant of summary judgment in an action alleging that FCA violated the Missouri Merchandising Practices Act (MMPA) by making deceptive representations about the safety of certain Jeep vehicles. Plaintiff also appealed the denial of his motion to remand to state court. The Eighth Circuit held that it had jurisdiction under the Class Action Fairness Act (CAFA) where the amount in controversy jurisdictional limit was satisfied after taking into consideration the sum of damages and the amount of potential attorneys' fees. The court held that plaintiff's claim under the MMPA failed where his purchase had no relationship with the alleged misrepresentation regarding the vehicles' safety. In this case, there was no evidence suggesting that either the seller or the buyer was aware of the misrepresentation, nor was the intermediary seller an unwitting conduit for passing on the substance of the misrepresentation. View "Faltermeier v. FCA US LLC" on Justia Law

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If a plaintiff would be entitled under a contract or statute to future attorneys' fees, such fees are at stake in the litigation and should be included in the amount in controversy. The Ninth Circuit reversed the district court's order remanding this action to state court under the Class Action Fairness Act (CAFA). The panel held that the district court erred in concluding that Swift failed to prove that the matter in controversy exceeded the sum or value of $5 million, as required for jurisdiction under CAFA. The panel held that defendants retained the burden of proving the amount of future attorney's fees by a preponderance of the evidence. Finally, the panel rejected plaintiff's contention that future attorneys' fees should not be included in the amount in controversy because they were inherently speculative. View "Fritsch v. Swift Transportation Company of Arizona, LLC" on Justia Law

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A class action stemming from Southwest’s decision to stop honoring drink vouchers for “business select” customers settled with the customers receiving replacement vouchers. The Seventh Circuit affirmed, holding that 28 U.S.C. 1712, the Class Action Fairness Act, allowed the court to award class counsel (Siprut) attorney fees ($1,365,882) based on the lodestar method rather than the value of the redeemed vouchers. On remand, Siprut sought supplemental fees. For its work on the motion to amend the fee award and the prior appeal, The court called the number of hours requested “grossly excessive,” stating that counsel was trying to reach “some of the originally hoped‐for $3,000,000 that Southwest agreed not to oppose.” The court awarded $455,294 plus expenses, then vacated so that the class would receive notice. In exchange for dismissal of an appeal, by objector Markow, Siprut agreed to take $227,647 plus $3,529.68 in expenses; Southwest agreed to issue two additional vouchers for each one claimed. The court was notified that the number of vouchers claimed under the original settlement was less than one-third what the parties earlier indicated and approved the new settlement. Southwest distributed the vouchers and paid Siprut. Markow then unsuccessfully moved for $80,000 in attorney fees and an incentive award of $1,000 from Siprut’s fee award. The Seventh Circuit reversed. Unless the parties to a class action settlement, including objecting parties, expressly agree otherwise, settlement agreements should not be read to bar objectors from requesting fees for their efforts in adding value to a settlement. View "Markow v. Southwest Airlines Co." on Justia Law

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Retired employees of the University of California Lawrence Livermore National Laboratory claim that during their employment the University promised to provide them with University-sponsored group health insurance in their retirement, and this promise constituted an implied contract term that the University subsequently impaired. Those who retired before 2007 initially received University-sponsored group health insurance after their retirement, funded by the federal government as part of the University’s contract. In 2007, the federal government transferred the management and operation of Livermore to a private entity, LLNS, which transferred the retirees’ coverage to the LLNS plan. The retirees claimed the LLNS health plan “has significant disadvantages and no comparable new advantages, when compared with the University-provided retiree medical benefit plan,” After initially certifying a class of retirees, the trial court decertified the class. The court of appeal reversed. The trial court erroneously assumed that each class member must prove their personal awareness of the offered retiree health benefits and that economic damages are a necessary element to an impairment claim. Retirees’ theory is that their loss of an entitlement to health insurance—since LLNS insurance can be terminated at any time—constitutes substantial impairment and this issue presents a common issue. View "Moen v. The Regents of the University of California" on Justia Law