Justia Class Action Opinion Summaries

Plaintiffs, representing themselves and a putative class, purchased Kleenex Germ Removal Wet Wipes manufactured by Kimberly-Clark Corporation. They alleged that the product’s labeling misled consumers into believing the wipes contained germicides and would kill germs, rather than merely wiping them away with soap. Plaintiffs claimed that this misrepresentation violated several California consumer protection statutes. The wipes were sold nationwide, and the plaintiffs included both California and non-California residents.The United States District Court for the Northern District of California first dismissed the non-California plaintiffs’ claims for lack of personal jurisdiction and dismissed the remaining claims under Rule 12(b)(6), finding that the labels would not plausibly deceive a reasonable consumer. The court dismissed the Second Amended Complaint (SAC) without leave to amend, and plaintiffs appealed.On appeal, the United States Court of Appeals for the Ninth Circuit reviewed whether subject-matter jurisdiction existed under diversity jurisdiction statutes, 28 U.S.C. §§ 1332(a) and 1332(d)(2). The court found that the SAC failed to allege Kimberly-Clark’s citizenship and did not state the amount in controversy. The panel held that diversity of citizenship cannot be established by judicial notice alone and that the complaint must affirmatively allege the amount in controversy. Plaintiffs were permitted to submit a proposed Third Amended Complaint (TAC), which successfully alleged diversity of citizenship but failed to plausibly allege the required amount in controversy for either statutory basis. The court concluded that neither it nor the district court had subject-matter jurisdiction and vacated the district court’s judgment, remanding with instructions to dismiss the case without prejudice. The panel denied further leave to amend, finding that additional amendment would be futile. View "ROSENWALD V. KIMBERLY-CLARK CORPORATION" on Justia Law

A borrower in Rhode Island financed a home purchase with a mortgage from a national bank. The mortgage required the borrower to make advance payments for property taxes and insurance into an escrow account managed by the bank. The bank did not pay interest on these escrowed funds, despite a Rhode Island statute mandating that banks pay interest on such accounts. Years later, the borrower filed a class action lawsuit against the bank, alleging breach of contract and unjust enrichment for failing to pay the required interest under state law.The United States District Court for the District of Rhode Island dismissed the complaint, agreeing with the bank that the National Bank Act preempted the Rhode Island statute. The court reasoned that the state law imposed limits on the bank’s federal powers, specifically the power to establish escrow accounts, and thus significantly interfered with the bank’s incidental powers under federal law. The court did not address class certification or the merits of the unjust enrichment claim, focusing solely on preemption.On appeal, the United States Court of Appeals for the First Circuit reviewed the case after the Supreme Court’s decision in Cantero v. Bank of America, N.A., which clarified the standard for preemption under the National Bank Act. The First Circuit held that the district court erred by not applying the nuanced, comparative analysis required by Cantero. The appellate court found that the bank failed to show that the Rhode Island statute significantly interfered with its federal banking powers or conflicted with the federal regulatory scheme. The First Circuit vacated the district court’s judgment and remanded the case for further proceedings, allowing the borrower’s claims to proceed. View "Conti v. Citizens Bank, N.A." on Justia Law

A group of shareholders in seven small-to-mid cap companies brought coordinated class actions against two major financial institutions, alleging that these institutions enabled Archegos Capital Management to amass large, nonpublic, and highly leveraged positions in the companies’ stocks through total return swaps and margin lending. When the value of these stocks declined and Archegos was unable to meet margin calls, the financial institutions quickly sold off their related positions before the public became aware of Archegos’ impending collapse. The shareholders claimed that this conduct constituted insider trading, arguing that the institutions used confidential information to avoid losses at the expense of ordinary investors.The United States District Court for the Southern District of New York first dismissed the shareholders’ complaints, finding insufficient factual allegations to support claims under both the classical and misappropriation theories of insider trading. The court allowed the shareholders to amend their complaint, but after a second amended complaint was filed, the court again dismissed the claims with prejudice. The district court concluded that the complaint did not plausibly allege that Archegos was a corporate insider or that the financial institutions owed a fiduciary duty to Archegos. It also found the allegations of tipping preferred clients to be unsupported by sufficient facts. The court dismissed the related claims under Sections 20A and 20(a) of the Securities Exchange Act for lack of an underlying securities violation.On appeal, the United States Court of Appeals for the Second Circuit affirmed the district court’s judgment. The Second Circuit held that the shareholders failed to plausibly allege that the financial institutions engaged in insider trading under either the classical or misappropriation theories. The court found no fiduciary or similar duty owed by Archegos to the issuers or by the financial institutions to Archegos, and determined that the complaint lacked sufficient factual allegations to support a tipping theory. The court also affirmed dismissal of the Section 20A and 20(a) claims. View "In Re: Archegos 20A Litigation" on Justia Law

Several individuals who had received grants of parole under programs established by the Department of Homeland Security (DHS) for nationals of Cuba, Haiti, Nicaragua, and Venezuela challenged the government’s decision to terminate those grants. The parole programs, created during the Biden Administration, allowed eligible individuals from these countries to enter the United States temporarily for up to two years, based on urgent humanitarian reasons or significant public benefit. When President Trump took office in January 2025, he issued executive orders directing DHS to end categorical parole programs, including the CHNV programs. DHS subsequently published a notice terminating the programs and revoking all existing grants of parole within thirty days, rather than allowing them to expire naturally.The plaintiffs, affected by the early termination, filed suit in the United States District Court for the District of Massachusetts. The district court certified a class of affected individuals and granted a preliminary stay, preventing DHS from revoking their parole grants before the original expiration dates. The court found that the plaintiffs were likely to succeed on their claim that the categorical termination was arbitrary and capricious under the Administrative Procedure Act (APA), in part because the agency’s rationale rested on a legal error and failed to adequately consider reliance and humanitarian interests.On appeal, the United States Court of Appeals for the First Circuit reviewed the district court’s order. The First Circuit held that the relevant statute requires DHS to grant parole only on a case-by-case basis, but does not impose the same limitation on the termination of parole. The court also found that the agency’s explanation for terminating the parole programs was not so deficient as to be arbitrary and capricious under the APA. Concluding that the plaintiffs had not made a strong showing of likelihood of success on the merits, the First Circuit vacated the district court’s stay and remanded for further proceedings. View "Doe v. Noem" on Justia Law

Two former customers of an insurance company filed suit after their vehicles were declared total losses and the insurer paid out claims based on the vehicles’ “actual cash value” (ACV). The insurance policy defined ACV as the “market value, age, and condition of the vehicle at the time the loss occurs.” The insurer calculated market value using a system that included a “projected sold adjustment” (PSA), which reduced the list prices of comparable vehicles to reflect typical consumer negotiation. The plaintiffs alleged that the PSA always resulted in an artificially low valuation, breaching the policy’s requirement to pay true market value.The United States District Court for the District of Arizona found that the plaintiffs met the requirements of numerosity, commonality, typicality, and adequacy under Federal Rule of Civil Procedure 23(a). However, the court determined that individual questions about how each vehicle’s ACV was calculated predominated over common questions, as required by Rule 23(b)(3), and therefore denied class certification. The plaintiffs appealed this decision.The United States Court of Appeals for the Ninth Circuit reviewed the district court’s denial of class certification for abuse of discretion. The appellate court held that the PSA was not facially unlawful and that determining whether each class member was harmed would require individualized inquiries into each person’s vehicle valuation. Because liability and injury could not be established through common evidence, individual issues would predominate over common ones. The Ninth Circuit therefore affirmed the district court’s order denying class certification, holding that class certification was inappropriate under Rule 23(b)(3) due to the predominance of individualized questions. View "AMBROSIO V. PROGRESSIVE PREFERRED INSURANCE COMPANY" on Justia Law

A property management company operating several apartment buildings in Missoula County contracted with a waste management provider for “three-yard” dumpster service. After the expiration of their initial service agreement, the provider continued to supply waste removal services on an invoice-by-invoice basis. The property management company later discovered that many of the dumpsters labeled as “three-yard” actually had a capacity of less than three cubic yards, with one model measuring approximately 2.52 cubic yards. The waste management provider rotated these containers among customers and did not maintain records of which customers received which models. The property management company alleged that it was charged overage fees for exceeding the stated capacity of these undersized containers.The property management company filed suit in the Fourth Judicial District Court, Missoula County, asserting claims for breach of contract and negligent misrepresentation, and sought to represent a class of similarly situated customers. The District Court bifurcated discovery and, after briefing and oral argument, certified two classes: one for breach of contract and one for negligent misrepresentation, both defined as customers who paid for “three-yard” service but received dumpsters of 2.6 cubic yards or less. The District Court found that common questions predominated over individual issues and that class litigation was superior to individual actions.On appeal, the Supreme Court of the State of Montana reviewed whether the District Court abused its discretion in finding predominance of common questions and whether it erred by not considering the ascertainability of class members. The Supreme Court held that the District Court did not abuse its discretion in certifying the classes, as common questions regarding the provider’s contractual and legal obligations predominated, and individualized damages did not preclude certification. The Court also held that ascertainability is not a mandatory requirement under Montana’s class action rule. The District Court’s order granting class certification was affirmed. View "Allied Waste v. LH Residential" on Justia Law

Peterson’s Oil Service, Inc. supplied heating fuel to customers in Massachusetts between 2012 and 2019. The fuel contained higher-than-standard levels of biodiesel, averaging 35% between 2015 and 2018, exceeding the 5% industry standard for ordinary heating oil. Customers alleged that this biodiesel-blended fuel was incompatible with conventional heating systems, caused repeated heat loss, and resulted in permanent damage to their equipment. They brought a class action in Massachusetts state court against Peterson’s and its officers, asserting claims for breach of contract, fraud, and negligence, including allegations that Peterson’s continued supplying the fuel despite customer complaints and only later disclosed the high biodiesel content.United States Fire Insurance Company and The North River Insurance Company had issued Peterson’s a series of commercial general liability and umbrella policies. The insurers initially defended Peterson’s in the class action under a reservation of rights, then filed suit in the United States District Court for the District of Massachusetts seeking a declaration that they owed no duty to defend or indemnify Peterson’s. The insurers moved for summary judgment, arguing that the claims did not arise from a covered “occurrence” and that policy provisions limiting or excluding coverage for failure to supply applied. The district court denied summary judgment, finding a genuine dispute as to whether Peterson’s actions were accidental and holding that the failure-to-supply provisions were ambiguous and did not apply.On appeal, the United States Court of Appeals for the First Circuit affirmed. The court held that the underlying complaint alleged a potentially covered “occurrence” because it was possible Peterson’s did not intend or expect the property damage alleged. The court also held that the failure-to-supply provisions were ambiguous and, under Massachusetts law, must be construed in favor of coverage. The district court’s summary judgment rulings were affirmed. View "United States Fire Insurance Company v. Peterson's Oil Service, Inc." on Justia Law

Two former employees of a fire alarm and sprinkler company provided fire alarm testing and inspection services on public works projects in New York. They alleged that their employer failed to pay them the prevailing wages required by New York Labor Law § 220, which mandates that workers on public works projects receive at least the prevailing rate of wages. The contracts between the employer and various public entities included clauses that either disclaimed the applicability of prevailing wage laws, were silent on the issue, or referenced prevailing wage rates. Many contracts also contained a provision shortening the statute of limitations for any action against the company to one year.The United States District Court for the Northern District of New York granted partial summary judgment in favor of the employer on all prevailing wage-related claims. The court found that: (1) the contracts did not expressly promise to pay prevailing wages; (2) the one-year contractual limitations period barred the claims; and (3) fire alarm testing and inspection work was not covered by § 220’s prevailing wage requirement. The court also dismissed related quantum meruit and unjust enrichment claims and later approved a class action settlement on other claims, with the prevailing wage claims reserved for appeal.On appeal, the United States Court of Appeals for the Second Circuit held that, based on a 2009 New York State Department of Labor opinion letter and relevant precedent, fire alarm testing and inspection work is covered by § 220, entitling the plaintiffs to prevailing wages. However, the Second Circuit found New York law unsettled on whether a promise to pay prevailing wages is implicit in every public works contract (even if not expressly stated) and whether a contractual one-year limitations period is enforceable against workers’ third-party beneficiary claims. The court therefore certified these two questions to the New York Court of Appeals for resolution. View "Walton v. Comfort Systems" on Justia Law

Customers of a heating oil company in Massachusetts brought a state court class action alleging that, starting in 2012, the company sold home heating oil with excessive biodiesel content, which damaged their heating equipment. The company received a demand letter and complaint in March 2019, before it was insured by the plaintiff insurance company. The insurance company began providing coverage in July 2019 under a commercial general liability policy and an umbrella policy. The policy included provisions excluding coverage for property damage known to the insured before the policy period began.After being asked to defend the company in the state class action, the insurer refused, arguing that the company’s prior knowledge of the alleged damage—based on the demand letter, complaint, and media coverage—triggered the policy’s known loss and loss-in-progress exclusions. The insurer then filed a declaratory judgment action in the United States District Court for the District of Massachusetts, seeking a ruling that it had no duty to defend or indemnify. The state court class had two subclasses: customers who received oil before July 5, 2019, and those who first received oil after that date.The district court found that the insurer had no duty to defend claims by customers who received oil before the policy period, but did have a duty to defend claims by customers who first received oil after coverage began, since the company could not have known of damage that had not yet occurred. Applying the “in for one, in for all” rule, the court held the insurer must defend the entire suit. The court denied summary judgment for the insurer on the duty to defend and granted partial summary judgment to the insured.The United States Court of Appeals for the First Circuit affirmed, holding that the policy’s known loss and loss-in-progress provisions did not bar coverage for claims by customers whose property damage began after the policy period commenced, and thus the insurer has a duty to defend the entire class action. View "Federated Mutual Insurance Co. v. Peterson's Oil Service, Inc." on Justia Law

During the COVID-19 pandemic, two individuals who held automobile insurance policies with a major insurer in California alleged that the insurer’s rates became excessive due to a significant reduction in driving and traffic accidents. They claimed that the insurer was required by statute to refund a portion of the premiums collected during this period, even though the rates had previously been approved by the state’s insurance commissioner. The insurer did provide partial refunds in response to directives from the insurance commissioner, but the plaintiffs argued these refunds were insufficient and sought further restitution on behalf of a class of similarly situated policyholders.The Superior Court of Alameda County initially allowed the plaintiffs to amend their complaint after sustaining a demurrer. In their amended complaint, the plaintiffs continued to assert claims under California’s Unfair Competition Law and for unjust enrichment, maintaining that the insurer’s failure to provide full refunds violated Insurance Code section 1861.05(a). The trial court, however, sustained the insurer’s subsequent demurrer without leave to amend, holding that the statutory scheme did not require insurers to retroactively refund premiums collected under previously approved rates, even if those rates later became excessive due to changed circumstances.The California Court of Appeal, First Appellate District, Division One, reviewed the case on appeal. The court held that Insurance Code section 1861.05(a) does not impose an independent obligation on insurers to retroactively refund premiums collected under rates approved by the insurance commissioner, even if those rates later become excessive. The court reasoned that the statutory scheme provides for prospective rate adjustments through the commissioner’s review process, not retroactive modifications. The court also found that the insurer’s conduct was affirmatively permitted under the statutory “prior approval” system, and thus not actionable under the Unfair Competition Law. The judgment in favor of the insurer was affirmed. View "Davis v. CSAA Insurance Exchange" on Justia Law