Justia U.S. 7th Circuit Court of Appeals Opinion Summaries

After discovering that she had lung cancer that had spread to her brain, Killian underwent aggressive treatment on the advice of her doctor. The treatment was unsuccessful and she died. Her husband submitted medical bills for the cost of the treatments to her health insurance company. The company denied coverage on most of the expenses because the provider was not covered by the insurance plan network. The husband filed suit, seeking benefits for incurred medical expenses, relief for breach of fiduciary duty, and statutory damages for failure to produce plan documents. The district court dismissed denial-of-benefits and breach-of-fiduciary-duty claims, but awarded minimal statutory damages against the plan administrator. In 2012, the Seventh Circuit affirmed the dismissals, rejecting an argument that the plan documents were in conflict, but remanded for recalculation of the statutory damages award. On rehearing, en banc, the Seventh Circuit affirmed the denial of benefits and statutory penalties holdings, but reversed on the breach of fiduciary duty claim. The instructions given in plan documents were deficient and a reasonable trier of fact could rule in favor of Killian, based on telephone conversations in which Killian attempt to determine whether the physicians who were about to perform surgery were within the network. View "Killian v. Concert Health Plan" on Justia Law

In 1999 Brumfield was hired as a nonprobationary police officer. In 2006 she began to experience unspecified “psychological problems.” The city required her to submit to four psychological examinations. Each time Brumfield was found capable of continuing her work. Brumfield sued, alleging that subjecting her to psychological examinations amounted to discrimination on account of race, sex, and sexual orientation. The city suspended Brumfield without pay pending discharge proceedings. The Police Board rejected the discharge recommendation but suspended Brumfield without pay for 180 days. Before the suspension expired the city again suspended Brumfield pending discharge proceedings. Before the Police Board issued its second suspension order and before Brumfield returned to work, the city initiated a third discharge proceeding. Brumfield filed another lawsuit, under Title II of the Americans with Disabilities Act, 42 U.S.C. 12132, and the Rehabilitation Act, 29 U.S.C. 794(a) and dismissed the first case. The district court dismissed, holding that the complaint failed to state a claim under either the ADA or the Rehabilitation Act. Brumfield filed a third suit, alleging violation of Title I of the ADA, which was dismissed as barred by res judicata. The Seventh Circuit affirmed. Title II of the ADA does not cover disability discrimination in public employment; such a claim must be brought under Title I, but Brumfield waived her challenge to dismissal of her Title I suit. The Rehabilitation Act claim fails because Brumfield has not alleged that she was suspended or fired by reason of disability.View "Brumfield v. City of Chicago" on Justia Law

Grandberry sought habeas corpus relief under 28 U.S.C. 2254 from a disciplinary sanction, loss of “good time” credits, imposed against him by a state prison. He claimed that the Indiana prison’s disciplinary proceedings failed to provide him with minimal due process protections. The district court denied the petition on the merits. The Seventh Circuit held that a certificate of appealability was not required in a habeas case challenging state prison disciplinary proceedings because in such cases, “the detention complained of” is the additional time the prisoner must stay in prison as a result of the disciplinary proceedings. The detention does not “arise out of process issued by a State court.” View "Grandberry v. Knight" on Justia Law

In 2012 the Seventh Circuit invalidated provisions of the Illinois gun law, 720 ILCS 5/24‐1,‐1.6, which, with limited exceptions, prohibited a person from carrying a ready-to-use gun outside his property or the property of someone who has granted permission. The court ordered its mandate stayed for 180 days to allow the state to craft a new gun law and extended the stay for an additional 30 days. In July 2013, the Illinois legislature, overriding a veto, enacted, the Firearms Concealed Carry Act, 430 ILCS 66/1, authorizing issuance of licenses for carrying guns outside the home. The Act requires an applicant to be at least 21 years old; have 16 hours of approved firearms training; have a currently valid Firearm Owner’s Identification Card; not have been convicted of assault, drunk driving, or certain other offenses or be in pending proceedings; and not have been treated recently for alcoholism or drug addiction. The state moved to dismiss the underlying cases as moot. Plaintiffs, upset by the new law’s delay of 270 days between its enactment and issuance of the first permits, requested that the state be ordered, until the Act is fully implemented, to allow any resident to carry a gun outside the home with only a FOID card. The Seventh Circuit affirmed denial of relief, stating that if plaintiffs “don’t like the new law, and wish to invalidate it, they must bring a new suit.” There was no prior order except a deadline for the state to enact a new law. It met the deadline. View "Shepard v. Madigan" on Justia Law

Sasafrasnet, an authorized distributor of BP products, provided Joseph with notice of its intent to terminate his franchise based on three occasions when Sasafrasnet attempted to debit Joseph’s bank account to pay for fuel deliveries but payment was denied for insufficient funds. The district court denied Joseph a preliminary injunction, finding that Joseph failed to meet his burden for a preliminary injunction under the Petroleum Marketing Practices Act 15 U.S.C. 2805(b)(2)(A)(ii). After a remand, the district court found that two of Joseph’s NSFs should count as “failures” under the PMPA justifying termination, at least for purposes of showing that he was not entitled to preliminary injunctive relief. The Seventh Circuit affirmed. Joseph’s bank account was not adequately funded for the debit on two occasions because Joseph had decided to change banks, circumstances entirely within Joseph’s control. Given Joseph’s history of making late payments in substantial amounts because of insufficient funds (each was more than $22,000), the delinquent payments were not “technical” or “unimportant.” View "Joseph v. Sasafrasnet, LLC" on Justia Law

In a proposed class action, Schilke alleged that Wachovia, her lender and holder of a mortgage on her home, fraudulently placed insurance on her property when her homeowner’s policy lapsed. Wachovia secured the replacement coverage from ASI and charged her for it, as specifically permitted by her loan agreement. The premium was more than twice what she had paid for her own policy and included a commission to Wachovia’s insurance-agency affiliate, also as permitted under the loan agreement. Schilke calls the commission a “kickback” and asserted statutory and common-law claims, most sounding in fraud or contract. The district court dismissed based on federal preemption and the filed-rate doctrine. The Seventh Circuit affirmed. The loan agreement and related disclosures and notices conclusively show that there was no deception at work. Wachovia fully disclosed that lender-placed insurance could be significantly more expensive than her own policy and could include a fee or other compensation to the bank and its insurance-agency affiliate. Maintaining property insurance was Schilke’s contractual obligation and she failed to fulfill it. . View "Schilke v. Am. Sec. Ins. Co." on Justia Law

Brookfield owns a shopping center that is subject to a first mortgage of $8,900,000, held by a trust, and a second mortgage for $2,539,375 that has been transferred to ValStone, which also serves as attorney in fact for the trust. Outside of bankruptcy, state law would allow ValStone to foreclose upon default on the second mortgage; ValStone could bid on the property at auction or receive proceeds from its sale. The second mortgage is a nonrecourse loan; if the proceeds of sale were not enough to repay the first mortgage or repay the second mortgage in full, ValStone could not pursue a deficiency claim for the outstanding debt. ValStone did not initiate foreclosure. Brookfield filed a Chapter 11 bankruptcy petition. Under its reorganization plan, Brookfield elected to retain ownership of the property, requiring the bankruptcy court to establish a judicial value by means of independent appraisals. The value is expected to be less than the amount of the first mortgage, which will leave the second mortgage unsecured by any equity. ValStone argued that 11 U.S.C. 1111(b)(1)(A) treats the claim as if it had recourse, so that its unsecured deficiency claim should be allowed. Brookfield argued that the claim should be disallowed because neither state law nor 11 U.S.C. 1111(b) give ValStone a deficiency claim against Brookfield. The bankruptcy court and the district court held that the claim was valid. The Seventh Circuit affirmed. View "B.R. Brookfield Commons No. 1 v. Valstone Asset Mgmt,, LLC" on Justia Law

Prison official Meyerhoff wrote a disciplinary report on inmate Hardaway, charging damage or misuse of property, forgery, and trading or trafficking of official electronics contract forms. Hardaway was sentenced to six months of disciplinary segregation, demotion in status, and revocation of commissary rights. Due to a childhood incident involving rape and abuse, which Hardaway associates with closed metal doors, Hardaway requested a cell with bars. Prison officials denied this request. Hardaway initiated a grievance, contending that he knew nothing about the sale of the electronics contracts, the charge was based solely on information provided by a confidential informant, the disciplinary report failed to state a specific time, place, or date, and that the disciplinary committee denied him the opportunity to view the forged contracts or argue any defense during the hearing. His second grievance was considered by the Illinois Administrative Review Board, which recommended remand for more specific information. Meyerhoff failed to revise the report, so the ARB upheld Hardaway’s grievance and concluded that the charge should be expunged. Hardaway had already served his segregation time, and claims that he experienced mental anguish as a result of the solid door; was physically attacked by his cell mate; and was only released from his cell once per week to shower and use the yard. The district court rejected his suit (42 U.S.C. 1983), finding that the defendants enjoyed qualified immunity. The Seventh Circuit affirmed. View "Hardaway v. Meyerhoff" on Justia Law

Anobah was an Illinois-licensed loan officer, employed by AFFC, and acted as a loan officer for at least two fraudulent schemes. Developers Brown and Adams recruited Mason to act as a nominee buyer of a property and referred Mason to Anobah for preparation of a fraudulent loan application. The application contained numerous material falsehoods concerning Mason’s employment, assets, and income, and intent to occupy the property. Anobah, Brown, and others created fraudulent supporting documents. AFFC issued two loans in the amount of $760,000 for the property and ultimately lost about $290,000 on those loans. In the course of the scheme, AFFC wired funds from an account in Alabama to a bank in Chicago, providing the basis for a wire fraud charge. Anobah played a similar role in other loan applications for other properties and ultimately pled guilty to one count of wire fraud, 18 U.S.C. 1343. The district court sentenced him to 36 months of imprisonment, five months below the low end of the calculated guidelines range. The Seventh Circuit affirmed, upholding application of guidelines enhancements for abuse of a position of trust and for use of sophisticated means in committing the fraud. View "United States v. Anobah" on Justia Law

Serino was employed as a soccer coach at Oakland City University in Indiana. In September 2008, the university’s Vice President informed Serino that he was suspended from his position then contacted Hensley, Chief of the Oakland City Police Department, and told him to come to the university athletic center to speak to Serino. Hensley complied. He confronted Serino and told him that he was trespassing. Serino refused to leave and Hensley then arrested him. Serino was arraigned on charges of trespass and resisting law enforcement. The state ultimately dismissed both charges. In 2012 Serino sued Hensley and Oakland City, 42 U.S.C. 1983, claiming false arrest and malicious prosecution, with Indiana tort claims for false arrest, malicious prosecution, and intentional infliction of emotional distress. The district court dismissed, finding the section 1983 and state‐law false arrest claims time‐barred; that the section 1983 malicious prosecution claim was not cognizable as a constitutional claim; and that his state‐law claims for malicious prosecution and IIED were barred by the defendants’ immunity under the Indiana Tort Claims Act. The Seventh Circuit affirmed. View "Serino v. Hensley" on Justia Law