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

Illinois prisoner Petties was climbing stairs when he felt a “pop” and extreme pain in his left ankle. At the prison infirmary, the examining physician prescribed Vicodin and crutches and a week of “meals lay-in.” The medical director, Dr. Carter, noted in the file that Petties had suffered an “Achilles tendon rupture” and modified the instructions, directing that Petties be scheduled for an MRI and examination by an orthopedist as an “urgent” matter. Prison lockdowns resulted in cancelation of three appointments. Eight weeks passed before he received an orthopedic boot. Petties claimed that more than a year later, he still experienced “serious pain, soreness, and stiffness” in his ankle. Petties argued that Carter was deliberately indifferent by failing to immobilize his ankle with a boot or cast immediately and that a physician he saw later was deliberately indifference in not ordering physical therapy despite a recommendation. The court granted the doctors summary judgment, reasoning that waiting before immobilizing Petties’s ankle could not have constituted deliberate indifference because several physicians held different opinions and that a jury could not reasonably find that rejection of the recommendation for physical therapy constituted deliberate indifference. The Seventh Circuit affirmed. A jury could not reasonably find that the treatment of Petties’s ankle rose to the level of a constitutional violation. View "Petties v. Carter" on Justia Law

CentiMark, a commercial roofer, hired Turnell as a laborer in 1978. In 1988 CentiMark promoted him to Chicago District Operations Manager. In his employment agreement, Turnell agreed to a non-disclosure provision and to restrictive covenants that prohibit “engag[ing] … in any Competing Business” during his employment and for two years afterward in any of the “regions and/or divisions and/or territories” in which he “operated” for CentiMark and “solicit[ing] the trade of, or trade with,” any of CentiMark’s “customers or suppliers, or prospective customers or suppliers” during his employment and for two years afterward. Turnell became Senior Vice President and Midwest Regional Manager. The company fired him in 2013, claiming that Turnell had misappropriated company resources and covered up fraudulent billing by his wife's company. Turnell claims the real reasons were his age, health issues, and high compensation. Turnell made little effort to find a job outside commercial roofing, but accepted an offer from Windward Roofing and contacted CentiMark customers. The court found Turnell’s covenants too broad, and entered a preliminary injunction, affirmed by the Seventh Circuit, that “Turnell shall not sell, attempt to sell, or help sell any products or services, or any combination thereof, related to commercial roofing to any person or entity who was a customer of Centimark Corporation as of January 8, 2013 and who is located in Illinois, Indiana, Michigan, Minnesota, North Dakota, South Dakota, or Wisconsin” and required CentiMark to post a $250,000 bond. View "Turnell v. Centimark Corp." on Justia Law

While Lee was on supervised release, his probation officer learned that he had assaulted his girlfriend, Pulliam, with a small souvenir baseball bat. The court issued a warrant for Lee’s arrest and initiated proceedings to revoke his supervised release. Law enforcement and medical personnel who interviewed or treated Pulliam testified. Pulliam had told each that Lee was the perpetrator. Pulliam took the stand, recanted, and said that she had made up a story because she was mad at Lee. She explained that she fell down the stairs. The court concluded that Lee had committed assault with a deadly weapon, revoked supervised release, and imposed a four-year term of imprisonment. Although he did not raise the argument below, Lee argued on appeal that he was denied due process under both the Fifth Amendment and Federal Rule of Criminal Procedure 32.1 because he did not receive adequate written notice of the precise crime that led to the revocation. The Seventh Circuit affirmed, declining to adopt a per se rule that only citation to a specific statute provides sufficient written notice of the alleged violation. Only the Ninth Circuit has adopted such a rule. Supervised release revocation hearings are not criminal prosecutions; the full panoply of rights does not extend to them. View "United States v. Lee" on Justia Law

Just before investing in Zhongpin on behalf of Prestige, Yang, a Chinese citizen employed at a U.S. investment firm, purchased Zhongpin shares and option contracts for himself. Yang was Prestige’s only officer and employee and sole investment manager. Yang did not disclose the purchases to Prestige. After its purchases, Prestige owned more than five percent of Zhongpin’s common stock, triggering an obligation to file Schedule 13D, 15 U.S.C. 78m(d). Yang and two others associated with Prestige filed Schedule 13D on behalf of Prestige, disclosing that Yang shared voting and dispositive power over Prestige’s Zhongpin shares, but failing to list the shares that Yang had purchased for himself, as required. The Schedule 13D misleadingly stated that, except for transactions listed on the form, “no transactions in the Common Stock were effected by any Reporting Person” in 60 days prior to Prestige’s attainment of its interest. Claiming deceptive “front-running,” the Securities and Exchange Commission instituted a civil suit. The jury found that Yang had violated the law by front-running and by filing a fraudulent disclosure. The court imposed a $150,000 penalty and enjoined Yang from future violations of U.S. securities law. The Seventh Circuit affirmed. Yang forfeited his arguments regarding the illegality of front-running and the materiality of his disclosure. View "Sec. & Eexch. Comm'n v. Yang" on Justia Law

The plaintiff alleged consumer fraud by the seller of a dietary supplement, and the district court certified a plaintiff class of individuals “who purchased Instaflex within the applicable statute of limitations of the respective Class States for personal use until the date notice is disseminated,” under Rule 23(a) and (b)(3). The court rejected defendant’s argument that Rule 23(b)(3) implies a heightened ascertainability requirement. The Seventh Circuit affirmed, noting an implicit requirement under Rule 23 that a class must be defined clearly and that membership be defined by objective criteria rather than by, for example, a class member’s state of mind. In addressing this requirement, courts have sometimes used the term “ascertainability.” Class definitions fail this requirement when they were too vague or subjective, or when class membership was defined in terms of success on the merits (fail-safe classes). This class satisfied “ascertainability” View "Mullins v. Direct Digital, LLC" on Justia Law

Northbound generates and sells life insurance leads, using the brand name “Leadbot,” but ran out of cash with a frozen line of credit and revenue that did not support its overhead. Norvax generates and sells health insurance leads. An asset purchase agreement was signed in 2009, “by and between” Northbound and Leadbot LLC, a subsidiary of Norvax that was formed to purchase the assets of Northbound. Under the agreement, Leadbot LLC was obligated to use the assets it acquired from Northbound in furtherance of the Leadbot brand. The purchase price was not paid in cash. Instead Northbound would receive an “earn-out” calculated as a percentage of the monthly net revenue of Leadbot LLC. The agreement also contained an Illinois choice-of-law clause. Northbound claims that Leadbot LLC and Norvax violated the agreement. The district court dismissed some claims and granted summary judgment for defendants on the remainder. The Seventh Circuit affirmed, reasoning that Norvax was not actually a party to the contract that was allegedly breached, nor is there any basis for holding Norvax liable for any breach by a subsidiary. View "Northbound Grp., Inc. v. Norvax, Inc." on Justia Law

In 2003, the SEC filed a civil suit against Custable, charging fraud involving “penny stocks” that yielded him at least $4 million. Criminal proceedings resulted in a long prison sentence for Custable. In 2010 he consented to entry of a judgment that ordered him to pay a $120,000 penalty plus $6.4 million in disgorgement of profits, 15 U.S.C. 78u(d). The SEC may either to remit the penalty money to the Treasury or to place it in the same fund as the disgorged profits, 15 U.S.C. 7246. Deciding that locating the defrauded victims would not be feasible, the Commission asked the court to allow it to pay to the Treasury all the disgorged profits that it had recovered. Hare, a purported victim of another Custable fraud and not a party, claimed to have an interest in the fund and asked the court to allow him to respond to any motion to disburse. The judge rejected Hare’s argument and granted the SEC’s motion to disburse the entire fund to the Treasury. The Seventh Circuit dismissed an appeal. Hare failed to establish that he is within an exception to the rule that forbids a nonparty to appeal; the grounds that he advanced for relief were frivolous View "Sec. & Exch. Comm'n v. Custable" on Justia Law

A police officer followed a vehicle after discovering that its owner’s driver’s license had expired 18 years earlier. He initiated a traffic stop after observing the vehicle cross into another lane on an Illinois highway without signaling. After the driver, Bentley, changed his story about why he was driving the vehicle, and officers observed that the spare tire was in the back seat, officers decided to call for a drug-detection dog, “Lex.” Lex alerted, and the officers found close to 15 kilograms of cocaine in the vehicle. Bentley gathered evidence suggesting “that Lex is lucky the Canine Training Institute doesn’t calculate class rank. If it did, Lex would have been at the bottom of his class.” Bentley argued that Lex might alert every time he is called out. The Seventh Circuit affirmed his conviction, citing the Supreme Court’s decision in Florida v. Harris (2013), and upholding the finding that Lex’s alert, along with the other evidence relating to the stop, was sufficient to support probable cause. View "United States v. Bentley" on Justia Law

Valdes was traveling by train. During a layover, DEA agents approached Valdes because he fit their profile of a drug courier, searched Valdes’s luggage, and found bundles of cash totaling $239,400. Each bundle was covered with several layers of packaging. Valdes stated that the money was his and that he was traveling to purchase computers for his computer recycling business. No drugs were found in his luggage. A drug-sniffing dog alerted to the bag containing the currency. The agents did not arrest Valdes. They told him that he was free to go but seized the currency. The government filed a civil forfeiture complaint under 21 U.S.C. 881(a)(6) alleging that the currency was furnished or intended to be furnished for a controlled substance. Valdes filed a claim, asserting an ownership. His wife also filed a claim, based on a community property and innocent ownership interest. After they filed their claims, but before they answered the complaint, the government served special interrogatories. The government moved to strike the claims and answers, arguing that the claimants failed to respond to interrogatories, so that they lacked standing. The district court agreed. The Sixth Circuit reversed. By blending standing and the merits, the court nullified Civil Asset Forfeiture Reform Act of 2000 protections that put the burden on the government to prove by a preponderance of evidence that property is forfeitable, 18 U.S.C. 983(c). View "United States v. Funds in the Amount of $239,400" on Justia Law

Illinois inmate Miller sued under 42 U.S.C. 1983, claiming deliberate indifference to his gastroesophageal reflux disease (GERD), which can cause severe heartburn. When Miller arrived at the prison he was taking Zantac for his GERD, but his prescription expired. At his intake screening he stated that he suffers from GERD and that he took prescription medication for it. He later told the director of nursing that he wanted his prescription renewed. A month later he saw another nurse, who scheduled him to see a doctor the following day. The appointment was cancelled because the prison was on lockdown. A guard whom he told that he needed to see a doctor replied that he should file a grievance, which he did. Though he marked it “emergency,” the warden determined that it was not an emergency, which meant that Miller could not see a doctor until the lockdown ended. During the two months before he saw a doctor, he complained repeatedly to staff about his GERD, to no avail. Once, upon vomiting stomach acid, he pressed an emergency button. A guard stated “you are not bleeding, you are not dead… it can’t be an emergency.” Eventually, the doctor renewed his prescription. The district court granted the defendants summary judgment. The Seventh Circuit reversed, stating that the judge engaged in “medical speculation.” View "Miller v. Campanella" on Justia Law