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

Defendants manufacture vitamins and nutritional supplements, including glucosamine pills, designed to help people with joint disorders, such as osteoarthritis. Several class action suits were filed under the Class Action Fairness Act, 28 U.S.C. 1332(d)(2), claiming violations of states’ consumer protection laws by making false claims. Eight months later, class counsel negotiated a nationwide settlement that was approved with significant modifications. The settlement requires Rexall to pay $1.93 million in fees to class counsel, plus $179,676 in expenses, $1.5 million in notice and administration costs, $1.13 million to the Orthopedic Research and Education Foundation, $865,284 to the 30,245 class members who submitted claims, and $30,000 to the six named plaintiffs ($5,000 apiece) Class members, led by the Center for Class Action Fairness, objected. The Seventh Circuit reversed, characterizing the settlement as “a selfish deal between class counsel and the defendant.” While most consumers of glucosamine pills are elderly and bought the product in containers with labels that recite the misrepresentations, only one-fourth of one percent of them will receive even modest compensation; for a limited period the labels will be changed, in trivial respects. The court questioned: “for conferring these meager benefits class counsel should receive almost $2 million?” View "Pearson v. NBTY, Inc." on Justia Law

Katsman, represented by an attorney, filed for Chapter 7 bankruptcy. After she filed Schedule F, on which the debtor is required to list all entities holding unsecured claims, the trustee reported that no assets were available for distribution. Before discharge was ordered, Skavysh, the son of Katsman’s ex-husband, filed an adversary proceeding invoking 11 U.S.C. 727(a)(4)(A). The bankruptcy judge conducted a trial of Skavysh’s objection to discharge and concluded that although there were omissions in Katsman’s schedules, they were not fraudulent. The only witness was Katsman; the judge decided that her testimony was truthful. The district judge reversed. The Seventh Circuit affirmed, noting that Katsman admitted that she had deliberately omitted creditors from her Schedule F: friends and family members who had lent her money during her acrimonious divorce from Skavysh’s father. She also failed to list property that she owned jointly with her ex-husband, including her home in Indiana and a time share in Las Vegas and alimony payments. The court found that “her many false statements bespeak a pattern of reckless indifference to the truth, implying fraudulent intent,” noting that despite her claims of ignorance of the law, she knows English and had competent counsel. View "Skavysh v. Katsman" on Justia Law

In 2001, Shannon McNamara was killed in her college apartment. McNamara’s window screen was cut. A box cutter handle and a credit card bearing the name “Anthony Mertz” were found in the apartment. Mertz claimed that he was drinking with friends the night of the murder and could not remember anything after a certain time. In an initial interview, investigators noticed Mertz’s scratches, bruises, and red knuckles. Tests on DNA scrapings from under McNamara’s fingernails were inconclusive, but did not exclude Mertz. Latex gloves were found in Mertz’s apartment, and a box cutter went missing from his work place the day that McNamara was killed. Convicted of aggravated criminal sexual assault, home invasion, and first-degree murder, Mertz was sentenced to death. The governor commuted his sentence to life imprisonment without the possibility of parole. At sentencing, the government presented evidence that Mertz committed assaults on several other women and men and that Mertz committed an unsolved 1999 murder. The Seventh Circuit affirmed denial of Mertz’s habeas petition alleging ineffective assistance of counsel for failing to rebut evidence that Mertz committed an uncharged murder and arson, finding that Mertz could not show prejudice. View "Mertz v. Williams" on Justia Law

The Strauss home in Mequon was built in 1994. They insured the home with policies issued by Chubb from October 1994 to October 2005. Water infiltrated and damaged the home through a defect present since the completion of construction; the damage went undiscovered until 2010, after those policies expired. Chubb denied coverage, contending that because the damage manifested in 2010 and the “manifestation” trigger applies to first-party property insurance, it could not be responsible for the damage. Chubb also asserted that the claim was submitted after expiration of the applicable statute of limitations. The district court concluded that the “continuous” trigger theory applied due to the language of the Policy such that coverage existed for the entire loss and that the claims were not time-barred. The Seventh Circuit affirmed. In Wisconsin, under the continuous trigger theory, a progressive loss “occurs continuously from exposure until manifestation.” Here, the loss was ongoing and occurred with each rainfall and the policy itself states that “[c]ontinuous or repeated exposure to substantially the same general conditions unless excluded is considered to be one occurrence.” The loss, for purposes of the statute of limitations, occurred all the way up until the damage manifested in October 2010. View "Strauss v. Chubb Indem. Ins. Co." on Justia Law

When Keller was admitted to the Terre Haute Penitentiary, he told the intake psychologist, Bleier, that he suffered from mental illness that affected his ability to function and feared that he would be attacked if placed in the general prison population. Bleier placed Keller in the general population. While on his way to lunch Keller was attacked by another inmate without provocation. The attack lasted several minutes. No guard saw the attack. Keller was eventually spotted lying face‐down, unconscious on the ground. Examinations by the prison medical staff and a hospital emergency room revealed extensive injuries to his face and head. Keller sued under the Federal Tort Claims Act, 28 U.S.C. 2674, alleging that prison employees violated mandatory regulations: Bleier did not examine all of his available medical documents before releasing him into the general prison population and the guards failed to monitor their assigned areas of the yard. The district court granted the government summary judgment based on the discretionary function exception under the Act. The Seventh Circuit reversed; the government did not sustain its burden to prove as a matter of law that the discretionary function exception shielded it from liability. View "Keller v. United States" on Justia Law

Applying for federal grants between 2005 and 2008, Chicago represented that it had formulated an Equal Employment Opportunity Plan in accordance with 28 C.F.R. 42.301. This certification is required by regulations implementing the Omnibus Crime Control and Safe Streets Act, under which the grants were made. Hill claimed, in a qui tam action under the False Claims Act, 31 U.S.C. 3729–33, that the first certification was false because, although the city had a written plan, and implemented an equal opportunity and affirmative action program, the program differs from the plan. Hill did not contend that the city’s program falls short of federal requirements only that the program does not follow the written plan. The district court granted summary judgment to the city. The Seventh Circuit affirmed. Any written plan sensibly can be understood to allow adaptations. No federal agency has parted with money under false pretenses and the record does not establish that the people in the Police Department and other bureaus who wrote grant applications and attached the city’s plan knew that the Department of Human Resources was implementing a program different from the plan, and without knowledge of falsity there cannot be a knowingly false claim. View "Hill v. City of Chicago" on Justia Law

Plaintiff has a commercial driver’s license and drives school buses, but wanted to drive vehicles that ferry equipment and people involved in movie and television productions. In Chicago such drivers belong to the Movie/Trade Show Division of Teamsters Local 727 and are paid twice what plaintiff earns as a bus driver. The Division has about 300 members, but in 70 years, has never referred a female driver to any production company. Because of agreements with those companies, the union effectively determines who is hired. In 2010 plaintiff applied, paid the union’s initiation fee, and began making dues payments. Months later, having received no referrals, she called the business agent, who told her to stop calling him. She received a similar response from a Transportation Coordinator. She claims that her résumé was never included with those of other applicants for referral. Referrals are not based on seniority and there is no shortage of work. She obtained an EEOC right to sue letter. The district court dismissed on the pleadings. The Seventh Circuit reversed and directed assignment to a different judge, noting “the abruptness and irregularity” of the handling of the case and “tone of derision that pervades his opinion.” View "Stuart v. Local 727, Int'l Bhd. of Teamsters" on Justia Law

Keith, caring for 13-month-old Christopher, called 911 and stated that she had “killed a baby.” During a videotaped interview she admitted hitting Christopher to make him stop crying, lifting Christopher by his feet and placing his body weight on his head, slapping and choking Christopher, and attempting to resuscitate Christopher by inserting a hairbrush down his throat to induce vomiting. Keith also stated that she abused a second child in her care by burning her feet with hot water and slapping her so hard that Keith covered her face with a scarf to prevent Keith’s husband from noticing. Keith was convicted of reckless homicide. Keith sought habeas corpus relief under 28 U.S.C. 2254, contending that the state judge unduly limited the testimony of a psychologist, Kula. The judge had allowed Kula to testify about the general characteristics of people with Keith’s diagnoses, but did not allow Kula to testify about Keith’s history of abuse. Kula testified that Keith suffered from schizoid personality disorder, major depressive disorder, general anxiety disorder, post-traumatic stress disorder, and obsessive-compulsive disorder, and that Keith had an IQ of 74. The district court denied the petition. The Seventh Circuit affirmed, concluding that the trial was fundamentally fair. View "Keith v. Schaub" on Justia Law

Brown, age 22, was in his Green Bay apartment with two friends, when there was knocking on his door and a yell of “police, search warrant!” As the police began to force open the front door, Brown ran upstairs to his bedroom and grabbed an unloaded shotgun. Police followed. As they reached the top of the stairs they saw him standing in the bedroom pointing the shotgun at them. Officer Secor shot Brown dead. The district court granted summary judgment in favor of the defendants in the estate’s suit under 42 U.S.C. 1983 that claimed that the police search was executed in an unreasonable manner. According to the estate, when Brown peered out of his front window after the knocking, he saw Secor—holding an automatic rifle, dressed in a dark hoodie, with long hair, earrings, a goatee, and sideburns,. Brown turned yelled “What the … we are getting robbed again” and fled upstairs. The estate argued that the police had no need to conduct the search after dark because they were looking for some loot of modest value. The Seventh Circuit affirmed, upholding the trial court’s rejection of a report by plaintiff’s expert, criticizing police procedure. View "Estate of Brown v. Thomas" on Justia Law

In 1999 Seltzer registered the word “Kashwére” as a trademark for chenille soft goods. In 2009, Seltzer sold his company’s assets, including the trademark, to its principal officers. They formed TMG, which granted Seltzer an exclusive license to sell chenille products under the Kashwére name in Japan, through Flat Be. TMG claims that Seltzer violated his license by creating USAJPN and transferring to it all rights conferred by his license, to create an appearance of distance between Seltzer and Flat Be. Although Seltzer owned a majority interest in USAJPN, he needed TMG’s approval for the transfer. Flat Be also created a line of fabrics, “Kashwére Re,’ that are not chenille. Seltzer’s license does not authorize use of the Kashwére name for products that are not chenille, but he claimed that a TMG owner approved the Kashwére Re project. USAJPN also failed to comply with a requirement to disclose the TMG licensee. The district judge denied TMG’s request to order the license cancelled or to enjoin future violations and award damages. The Seventh Circuit upheld summary judgment in favor of TMG on Seltzer’s and Flat Be’s counterclaims, but reversed summary judgment in favor of Seltzer and Flat Be on TMG’s claims. View "Kashwere, LLC v. Kashwere USAJPN, LLC" on Justia Law