Latest 15 Cases This Week: Chen v. United States Sports Academy, Inc. (1st Cir.), Simmons v. Trans Express Inc. (2d Cir.), Common Cause v. Lewis ...

Bringing Home the Supply Chain

SAMUEL ESTREICHER, JONATHAN F. HARRIS

NYU law professors Samuel Estreicher and Jonathan F. Harris describe how the COVID-19 pandemic is forcing the United States to confront the problem of unchecked globalization. Estreicher and Harris argue that once the pandemic subsides, U.S. policymakers should, as a matter of national security, mandate that a minimum percentage of essential supplies be manufactured domestically.

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Unconstitutional Chaos: Abortion in the Time of COVID-19

JOANNA L. GROSSMAN, MARY ZIEGLER

SMU Dedman School of Law professor Joanna L. Grossman and Florida State University law professor Mary Ziegler discuss the abortion bans implemented in several states in response to the COVID-19 pandemic. Grossman and Ziegler explain why the bans are constitutional and comment on the connection between the legal challenges to those bans and the broader fight over abortion rights.

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Chen v. United States Sports Academy, Inc.

Court: US Court of Appeals for the First Circuit

Docket: 19-1382

Opinion Date: April 15, 2020

Judge: Selya

Areas of Law: Civil Procedure, Contracts

The First Circuit affirmed the district court's dismissal of the complaint in this case for want of jurisdiction, holding that personal jurisdiction could not constitutionally be exercised over Defendant in Massachusetts. Defendant was an education institution incorporated in Alabama having its principal place of business there. Plaintiff, who had enrolled in Defendant's doctoral program in sports management, sued Defendant in a Massachusetts state court alleging breach of contract, unfair and deceptive business practices, unjust enrichment, and fraudulent inducement. Defendant removed the case to the federal district court then moved to dismiss the complaint for want of personal jurisdiction. The district court granted the motion, concluding that the court lacked general and specific jurisdiction over Defendant. The First Circuit affirmed, holding that the district court appropriately determined that neither general jurisdiction nor specific jurisdiction may constitutionally be exercised over Defendant in Massachusetts.

Simmons v. Trans Express Inc.

Court: US Court of Appeals for the Second Circuit

Docket: 19-438

Opinion Date: April 13, 2020

Judge: Richard J. Sullivan

Areas of Law: Civil Procedure

The Second Circuit certified a question of New York law to the New York Court of Appeals: Under New York City Civil Court Act 1808, what issue preclusion, claim preclusion, and/or res judicata effects, if any, does a small claims court's prior judgment have on subsequent actions brought in other courts involving the same facts, issues, and/or parties? In particular, where a small claims court has rendered a judgment on a claim, does Section 1808 preclude a subsequent action involving a claim arising from the same transaction, occurrence, or employment relationship?

Common Cause v. Lewis

Court: US Court of Appeals for the Fourth Circuit

Dockets: 19-1091, 19–1094

Opinion Date: April 16, 2020

Judge: Roger L. Gregory

Areas of Law: Civil Procedure, Civil Rights, Constitutional Law, Election Law

In this gerrymandering action, brought exclusively under the North Carolina Constitution against certain state legislators, the Fourth Circuit held that the district court did not err in remanding because the Legislative Defendants do not have an enforcement role within the meaning of the Refusal Clause of 28 U.S.C. 1443(2). Consequently, the court need not address whether the Legislative Defendants refused to act or whether they asserted a colorable conflict with federal law. The court also held that the district court did not abuse its discretion in declining to award fees and costs, because the legislators removed within the statutorily mandated time limit and adhered to the district court's expedited briefing schedule. Accordingly, the court affirmed the district court's judgment.

In re National Prescription Opiate Litigation

Court: US Court of Appeals for the Sixth Circuit

Docket: 20-3075

Opinion Date: April 15, 2020

Judge: Raymond M. Kethledge

Areas of Law: Civil Procedure, Drugs & Biotech

The counties filed suit in the Northern District of Ohio against manufacturers and distributors of prescription opioids. More than 2,700 other opioid cases have been transferred there by the Judicial Panel on Multidistrict Litigation (MDL). The first Case Management Order put the Counties’ cases on “Track One,” with a March 2019 trial date, setting a deadline in April 2018 for the Counties to amend their complaints. The Counties then asserted claims against 12 Pharmacies as “distributors” of pharmaceuticals to their own retail pharmacies, expressly declining to bring "dispenser" claims. Distributors ship pharmaceuticals wholesale; dispensers fill prescriptions. The Track One parties engaged in massive discovery. Rather than ruling on summary judgment motions, the district court granted the Counties’ motion to sever all but one Pharmacy (Walgreens) from Track One. Trial had been rescheduled for October 2019. The 11 Pharmacies settled with the Counties, agreeing to pay $260 million. The district court canceled the trial, then allowed the Counties to amend their complaints to add “dispenser” claims and ordered discovery to proceed anew. The court refused to rule on dismissal motions and ordered the Pharmacies to produce data on every prescription that they had filled for any opioid medication, anywhere in the U.S., dating back to 2006. The Sixth Circuit ordered that the amendments to the complaints be stricken, noting that the Federal Rules of Civil Procedure apply in MDL under 28 U.S.C. 1407 and had been disregarded in several instances.

Douglas v. Price

Court: US Court of Appeals for the Seventh Circuit

Docket: 19-1868

Opinion Date: April 13, 2020

Judge: Diane S. Sykes

Areas of Law: Civil Procedure, Class Action, Legal Ethics

The $8.5 million proposed settlement of a class action that claimed that Western Union violated the Telephone Consumer Protection Act by sending unsolicited text messages, 47 U.S.C. 227(b)(1)(A)(iii). defined the class as: “All Persons in the United States who received one or more unsolicited text messages sent by or on behalf of Western Union.” Price, thinking she was a class member because she had received two text messages from Western, objected, arguing that the settlement inadequately compensated the class; class counsel’s fee request was too high; the plaintiff’s incentive award was too high; the class definition was imprecise; and the list of class members had errors. Western’s records confirmed that Price had enrolled in its loyalty program, checking a disclaimer box consenting to receive text messages. The judge certified the class, ruled that Price was not a member, approved the settlement, and reduced class counsel’s fees. Price did not appeal her exclusion from the class and did not seek to intervene but sought attorney’s fees and an incentive award. Her motion was denied because Price had cited “no authority for the highly questionable proposition that a non‐class member can recover fees and an incentive award under Rule 23.” The Seventh Circuit dismissed her appeal for lack of jurisdiction. Price is not a party and lacks standing to appeal.

Shatsky v. Palestine Liberation Organization

Court: US Court of Appeals for the District of Columbia Circuit

Docket: 17-7168

Opinion Date: April 14, 2020

Judge: Patricia Ann Millett

Areas of Law: Civil Procedure

The families of American victims of a 2002 bombing in the West Bank filed suit against the Palestinian Defendants, alleging that defendant are liable for the attack on the theory that they enabled the bombing through their provision of significant support to the Popular Front. After determining that the district court's ruling is an appealable final judgment, the DC Circuit held that the district court erred in rejecting the Palestinian Defendants' argument that the district court lacked personal jurisdiction. In this case, the families forfeited their interest in the cross-appeal rule, and exceptional circumstances excused the Palestinian Defendants' failure to cross-appeal the question of personal jurisdiction. The court held that the Palestinian Defendants did not forfeit their personal jurisdiction defense, and the district court abused its discretion in concluding otherwise. Accordingly, the court vacated the district court's judgment and remanded for the district court to dismiss the case without prejudice.

Seater v Estate of Fred L. Seater

Court: Alaska Supreme Court

Docket: S-17174

Opinion Date: April 10, 2020

Judge: Joel H. Bolger

Areas of Law: Civil Procedure, Real Estate & Property Law

In the 1940s, Fred E.W. and Clara Seater acquired a roughly five-acre parcel located along the Nikiski Bay beach in the Cook Inlet region, referred to as Lot 9. In 1956, following Fred E.W.’s death, Clara transferred Lot 9 to her sons Ronald Seater and Fred L. Seater, as tenants in common. Fred L. died in 1979. His widow, Lee Seater, as executor of his estate, conveyed his share in Lot 9 to herself. Ronald filed for partition of Lot 9 in January 2010. In February 2012, a superior court issued a partition order severing Ronald and Lee’s tenancy in common. he partition made a straight-line division in Lot 9 to create a northern “Lot 1” and a southern “Lot 2” of “reasonably equal 'value.’ ” Lee was granted the northern “Lot 1” and Ronald was granted the southern “Lot 2.” In April 2012 Ronald requested the use of an old access trail that crossed Lot 1. In October the superior court granted Ronald “an express appurtenant easement by necessity over Lot 1 for ingress and egress via the trail/road into the northern boundary of Lot 1.” In June 2014 Lee requested that “reciprocal easements for ingress and egress be established between Lot 1 and Lot 2.” In September 2015 the superior court entered a decision granting Lee’s request. In July 2016 Lee moved to enforce the September 2015 decision. She alleged that Ronald was placing boulders on or around the easement to frustrate her access. Ronald claims that in response he “installed boulder fences . . . along a 10-foot wide corridor centered on the 'diagonal cut’ on Lot 2, in order to mark the boundary between Lots 1 and 2; identify the location of the 'diagonal cut[’;] deter trespassers (including the Lee Seater family); and prevent more erosion on Lot 2.” In July 2017 Lee filed an enforcement motion alleging that Ronald continued to frustrate her access to the easement. Ronald appealed the modification of the partition, and the subsequent related enforcement orders. The Alaska Supreme Court concluded Ronald's appeal was untimely with respect to all but the most recent enforcement order, which contained an erroneous interpretation of a term used in prior orders. The matter was remanded for the superior court to rectify that mistake.

Anthony v. Li

Court: California Courts of Appeal

Docket: A156640(First Appellate District)

Opinion Date: April 13, 2020

Judge: Petrou

Areas of Law: Civil Procedure, Legal Ethics

In 2016, Anthony filed suit seeking to recover damages for personal injuries sustained in a car accident between him and Li. The parties unsuccessfully participated in voluntary private mediation and paid the requested fees. Anthony served a Civil Code 998 offer, seeking to compromise the action for $500,000.00, “each side to bear its own fees and costs.” Li did not accept. Li later made a section 998 offer to settle all claims against him for $175,001.00, with “each party bearing their own attorney fees and costs.” Anthony did not accept the offer. The parties jointly hired a court reporting service to record the trial proceedings. Counsel signed an agreement to share equally the fees for court reporting services. Anthony was billed and paid his share of court reporter fees. A jury returned a verdict finding Li negligent and awarding Anthony damages of $650,235.00., Anthony served a memorandum of costs for $83,048.06, seeking: $62,082.50 for section 998 post-offer expert witness fees; $2,650 for mediation fees, and $6,561.62 for court reporter fees. The court of appeal affirmed an order striking the motion. The parties agreed to share mediation and court reporter fees equally, without providing for the later recovery of those shared fees by a prevailing party.

Nuno v. California State University, Bakersfield

Court: California Courts of Appeal

Docket: F077889(Fifth Appellate District)

Opinion Date: April 13, 2020

Judge: Donald R. Franson, Jr.

Areas of Law: Civil Procedure

The Court of Appeal reversed the trial court's dismissal of plaintiff's action under the California Fair Employment and Housing Act in light of Gamet v. Blanchard (2001) 91 Cal.App.4th 1276. In Gamet, the court set forth the principle that self-represented litigants are not entitled to special exemptions from California's procedural rules, but they are "entitled to treatment equal to that of a represented party." In this case, the trial court's statements at a case management conference about the filing of an amended complaint were not clear and understandable. Therefore, plaintiff was misled into believing he had until the next case management conference to seek counsel and file an amended complaint and, relying on this belief, he left the country to attend an educational conference. While plaintiff was out of the country, defendants obtained an ex parte order dismissing the action withe prejudice under Code of Civil Procedure section 581, subdivision (f)(2). Therefore, the court held that the trial court (1) prejudicially abused its discretion by failing to provide clear and understandable instructions to plaintiff that the setting of another case management conference did not extend the deadline for filing an amended complaint and (2) dismissing plaintiff's action with prejudice prior to that conference.

Salzberg v. Sciabacucchi

Court: Delaware Supreme Court

Docket: 346, 2019

Opinion Date: April 14, 2020

Judge: Karen L. Valihura

Areas of Law: Business Law, Civil Procedure, Securities Law

The issue raised on appeal to the Delaware Supreme Court centered on the validity of a provision in several Delaware corporations’ charters requiring actions arising under the federal Securities Act of 1933 (the “Securities Act” or “1933 Act”) to be filed in a federal court. Blue Apron Holdings, Inc., Roku, Inc., and Stitch Fix, Inc. were all Delaware corporations that launched initial public offerings in 2017. Before filing their registration statements with the United States Securities and Exchange Commission (the “SEC”), each company adopted a federal-forum provision. Appellee Matthew Sciabacucchi bought shares of each company in its initial public offering or a short time later. He then sought a declaratory judgment in the Court of Chancery that the FFPs were invalid under Delaware law. The Court of Chancery held that the FFPs were indeed invalid because the “constitutive documents of a Delaware corporation cannot bind a plaintiff to a particular forum when the claim does not involve rights or relationships that were established by or under Delaware’s corporate law.” The Supreme Court disagreed and reversed, finding that such a provision could survive a facial challenge under Delaware law.

Idaho ex rel. Industrial Commission v. Sky Down Sky Diving

Court: Idaho Supreme Court - Civil

Docket: 47077

Opinion Date: April 16, 2020

Judge: Moeller

Areas of Law: Civil Procedure, Government & Administrative Law, Labor & Employment Law

The issue this appeal presented for the Idaho Supreme Court's review centered on whether Sky Down Skydiving, LLC, improperly designated its tandem skydiving instructors and parachute packers as independent contractors, rather than as employees, thereby eliminating the need for worker’s compensation insurance. After notifying the company that it was in violation of Idaho Code section 72-301, the Industrial Commission filed a civil law suit against Sky Down for penalties and injunctive relief. Following a bench trial, the magistrate court concluded that the instructors and parachute packers were independent contractors. The magistrate court then dismissed the Commission’s complaint with prejudice. After the case was dismissed, a witness contacted the Industrial Commission’s counsel to recant his earlier testimony. The Commission then filed a motion for a new trial, which was denied by the magistrate court. The Commission filed an intermediate appeal with the district court, which affirmed the magistrate court’s decision. The Commission then timely appealed to the Idaho Supreme Court, which reversed and remanded because both lower courts erred by failing to apply the proper test, and the district court erred in concluding there was substantial and competent evidence to support the magistrate court’s findings.

Woolley v. Idaho Dept. of Labor

Court: Idaho Supreme Court - Civil

Docket: 46743

Opinion Date: April 16, 2020

Judge: Bevan

Areas of Law: Civil Procedure, Government & Administrative Law, Labor & Employment Law, Public Benefits

Brett Woolley appealed an Idaho Industrial Commission (“Commission”) decision that found him ineligible for unemployment benefits. The Commission determined that Woolley was ineligible for benefits because he was a corporate officer whose claim for benefits was based on wages from a corporation in which he had an ownership interest. The Commission also determined Woolley willfully made a false statement by saying he had not received wages or performed services as a corporate officer. After review, the Idaho Supreme Court affirmed the Commission’s determination that Woolley was ineligible for benefits due to his status as a corporate officer because it was supported by substantial and competent evidence. However, the Court found Woolley did not willfully misrepresent his status as a corporate officer, "The statute makes no mention of a claimant’s performance of services as a corporate officer. To compound the confusion, IDOL provides no information in the unemployment handbook or on its website to explain why it is necessary for claimants to report their corporate officer status when filing a claim for benefits. To serve as the basis for a willful failure to report a material fact, the question to be answered by a claimant must be accurately grounded in the legal requirements of the statute."

Walker v. Day

Court: New Hampshire Supreme Court

Docket: 2019-0236

Opinion Date: April 14, 2020

Judge: Donovan

Areas of Law: Business Law, Civil Procedure

Plaintiff Alexander Walker, Jr. appealed a superior court order dismissing his claim of conspiracy to defame on res judicata grounds after finding privity between defendant Aaron Day, and other defendants in a separate defamation action. While plaintiff’s defamation action was pending, he filed a lawsuit against defendant, alleging a claim of conspiracy to commit defamation and seeking enhanced compensatory damages. The complaint described the defamation, which provided the basis for the conspiracy claim, in much the same terms as the complaint in the separate defamation action, but also alleged facts to support the conspiracy claim. Defendant moved to dismiss the conspiracy action on the grounds of, inter alia, res judicata, arguing, in part, that he was in privity with the defamation defendants for res judicata purposes. On appeal, plaintiff argued the trial court erred by: (1) deciding the privity issue at the motion to dismiss stage; and (2) applying the First Circuit Court of Appeals’ privity standard, rather than New Hampshire precedent, to determine privity. The New Hampshire Supreme Court agreed that the trial court erred by applying the privity standard used by the First Circuit, and, therefore, vacated the trial court’s ruling and remanded.

Nieves v. Office of the Public Defender

Court: Supreme Court of New Jersey

Docket: a-69-18

Opinion Date: April 15, 2020

Judge: Jaynee LaVecchia

Areas of Law: Civil Procedure, Government & Administrative Law, Legal Ethics, Personal Injury, Professional Malpractice & Ethics

This case arose from the representation of plaintiff Antonio Nieves by a state public defender, Peter Adolf, Esq. After his conviction, Nieves was granted post-conviction relief based on the ineffective assistance of counsel at trial. DNA evidence later confirmed that Nieves was not the perpetrator, and the underlying indictment against him was dismissed. Nieves subsequently recovered damages from the State for the time he spent wrongfully imprisoned. He then filed the present legal malpractice action seeking damages against the Office of the Public Defender (OPD) and Adolf. Defendants moved for summary judgment, arguing that the New Jersey Tort Claims Act (TCA) barred the damages sought because Nieves failed to vault N.J.S.A. 59:9-2(d)’s verbal threshold. The motion court concluded that the TCA and its verbal threshold were inapplicable. The Appellate Division reversed, concluding that “public defenders are public employees that come within the TCA’s immunities and defenses” and that Nieves’s claim fell squarely within the TCA. The Appellate Division also held that plaintiff’s claim for loss of liberty damages fell within the TCA’s limitation on recovery for pain and suffering in N.J.S.A. 59:9-2(d), which Nieves failed to satisfy. The New Jersey Supreme Court concluded the TCA applied to Nieves’s legal malpractice action, and his claim for loss of liberty damages failed to vault the verbal threshold for a pain and suffering damages claim under the strictures of N.J.S.A. 59:9-2(d). Defendants were entitled to summary judgment.

Citizens for Resp. Devel. in The Dalles v. Walmart

Court: Oregon Supreme Court

Docket: S066596

Opinion Date: April 16, 2020

Judge: Flynn

Areas of Law: Civil Procedure, Environmental Law, Government & Administrative Law, Zoning, Planning & Land Use

The Oregon Department of State Lands (DSL) issued a permit, pursuant to ORS 196.825, for Wal-Mart Stores, Inc. (“Walmart”) to fill and remove some wetlands on private property in order to build a new store in The Dalles. Citizens for Responsible Development in The Dalles (Citizens) opposed the project and appealed the fill permit, arguing that DSL lacked authority to issue the permit because DSL did not find that there was a “public need” for the project. The Court of Appeals agreed with Citizens that DSL erred in issuing the permit “[b]ecause DSL found that it was inconclusive whether the project would address a public need.” The Oregon Supreme Court granted certiorari to construe ORS 196.825, and thereafter affirmed the Court of Appeals: the matter was remanded to DSL. "[A]lthough we disagree with its premise that ORS 196.825 conditions the issuance of every permit on a finding that the proposed project will serve a 'public need,' . . . Because DSL found that all categories of public benefit from the project were 'inconclusive' but failed to find that the project would not 'interfere' with the state’s 'paramount policy,' the record does not support its determination that the project will not 'unreasonably interfere.'”