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

Cothron works at an Illinois White Castle restaurant where she must scan her fingerprint to access the computer system. With each scan, her fingerprint is collected and transmitted to a third-party vendor for authentication. Cothron alleges that White Castle did not obtain her written consent before implementing the fingerprint-scanning system, violating the Illinois Biometric Information Privacy Act, 740 ILCS 14/1, arguing that every unauthorized fingerprint scan amounted to a separate violation of the statute, so a new claim accrued with each scan. On interlocutory appeal, the Seventh Circuit certified a question to the Illinois Supreme Court, which responded that claims accrue each time a private entity scans a person’s biometric identifier and each time a private entity transmits such a scan to a third party, respectively, not only upon the first scan and first transmission.The Seventh Circuit then lifted a stay and affirmed the denial of White Castle’s motion for judgment on the pleadings. The court rejected White Castle’s request to expand the interlocutory appeal to include new questions concerning the scope of a possible damages award and Due Process and Excessive Fines Clause claims. The order before the court concerned only the timeliness of Cothron’s suit. View "Latrina Cothron v. White Castle System, Inc." on Justia Law

Midvale created an “instant quote” feature on their websites. Anyone who supplied basic identifying information could receive a quote for auto insurance. Each site would auto-fill some information, including the number of the applicant’s driver’s license. Anyone could enter a stranger’s name and home address, which caused the form to disclose the number of the stranger’s driver’s license. Midvale discontinued the autofill feature after observing unusual activity suggesting misuse, and notified people whose information had been disclosed improperly. Three people who received Midvale’s notice filed a purported class action under the Driver’s Privacy Protection Act, 18 U.S.C. 2721–25.The district court held that the plaintiffs lacked standing, having failed to show a concrete injury traceable to the disclosure. The Seventh Circuit affirmed, noting that whether the Act applies at all is questionable. Its principal rule is directed to state officials rather than private actors. A driver’s-license number is not potentially embarrassing or an intrusion on seclusion. It is a neutral fact derived from public records, a fact legitimately known to many private actors and freely revealed to banks, insurers, hotels, and others. Plaintiffs have not plausibly alleged that Midvale’s disclosure of their numbers caused them any injury, and the disclosure of a number in common use by both public and private actors does not correspond to any tort. View "Baysal v. Midvale Indemnity Co." on Justia Law

In 2015, the Forro children attended St. Augustine, a self-identified Catholic school in Hartford, Wisconsin. Wisconsin provides transportation benefits for parents who send their children to private sectarian schools, Wis.Stat. 121.54. The school district and the state superintendent of public instruction denied the Forros' request because transportation was being provided to St. Gabriel, another Catholic school in the area. The law stipulates that only one school from a single organizational entity in each “attendance area” may qualify for benefits. While both claim an affiliation with Catholicism, the two schools are not affiliated with one another in other significant ways. St. Augustine and the Forros sued. Several years of litigation ensued, including a trip to the U.S. Supreme Court, two published Seventh Circuit opinions, and a Supreme Court of Wisconsin opinion, after which the Seventh Circuit concluded that the denial of transportation benefits violated Wisconsin law because it rested on an improper methodology for determining affiliation between two schools of similar faith.After noting that certain state law claims had been waived and that the federal constitutional issues did not require resolution, the Seventh Circuit affirmed that a declaratory judgment remains in effect against the Superintendent and the School District. The district court may decide what attorneys’ fees the plaintiffs should be awarded, if any, given that they have prevailed only in obtaining declaratory relief under state law. View "St. Augustine School v. Underly" on Justia Law

One week after Schmees started working for HC1.COM, the company eliminated her position and terminated her employment. Schmees sued, alleging that HC1 fraudulently induced her to join the company. HC1 moved to dismiss Schmees’s first amended complaint. Three months after the parties had briefed the motion, Schmees sought leave to amend her complaint to add new factual allegations buttressing the same claims. The district court denied HC1’s motion to dismiss Schmees’s fraud claims, then denied as moot the motion for leave to amend. The court gave Schmees a month to renew the motion; she opted not to seek a further amendment. In response to HC1’s subsequent motion for summary judgment, Schmees attempted to supplement her complaint with a new fraud claim via her briefing. The district court granted HC1 summary judgment, finding the new fraud claim beyond the scope of the complaint, and declining to treat her response brief as a de facto amendment to the complaint.The Seventh Circuit affirmed. The district court did not abuse its discretion. After concluding that Schmees had sufficiently stated her fraud claims, adding new facts supporting those claims was unnecessary. The court invited Schmees to seek leave again, but she did not. At summary judgment, it was too late for Schmees to add a new claim beyond the scope of the complaint. View "Schmees v. HC1.com, Inc." on Justia Law

Menasha licensed Nulogy’s software, Nulogy Solution. Years later, Deloitte reviewed Menasha’s systems in hopes of better integrating Nulogy Solution into Menasha’s other software. Deloitte and Menasha asked Nulogy to share proprietary information. Nulogy alleges that the two used this information to reverse engineer an alternative to Nulogy Solution. In 2020, Nulogy filed suit in Ontario’s Superior Court of Justice, alleging breach of contract by Menasha and violations of trade secrets by Menasha and Deloitte. Deloitte objected to jurisdiction in Canada.Nulogy voluntarily dismissed its trade secret claims against both companies and refiled those claims in the Northern District of Illinois under the Defend Trade Secrets Act, 18 U.S.C. 1836(b). The breach of contract claims against Menasha remained pending in Canada. Menasha moved to dismiss the U.S. trade secrets litigation. Menasha’s contract with Nulogy contained a forum selection clause, identifying Ontario, Canada. Deloitte did not join that motion but filed its own motion to dismiss arguing failure to state a claim. The district court dismissed the claims against Menasha but reasoned that the forum non-conveniens doctrine required the dismissal of the entire complaint, including the claims against Deloitte.The Seventh Circuit affirmed the dismissal of Nulogy’s claims against Menasha but reversed the Deloitte dismissal. Deloitte has no contractual agreement with Nulogy identifying Canada as the proper forum and continues to insist that Canadian courts do not have jurisdiction. View "Nulogy Corp. v. Menasha Packaging Co., LLC" on Justia Law

Mac Naughton, a New Jersey attorney, represented Harmelech in a lawsuit filed by RMG until Harmelech failed to pay his legal fees. Mac Naughton later purchased from RMG the rights to the unpaid portion of a settlement judgment and filed multiple actions against Harmelech, seeking to collect the Judgment. He sought to set aside Harmelech’s conveyance of his Highland Park home to his son. Harmelech moved to disqualify Mac Naughton under New Jersey Rule of Professional Conduct 1.9(a): A lawyer who has represented a client “shall not thereafter represent another client in … a substantially related matter in which that client’s interests are materially adverse to the interests of the former client.” Judge Holderman barred Mac Naughton from acting as counsel in efforts to collect the RMG Judgment. Mac Naughton continued prosecuting the matter and filed similar actions before different judges. The Highland Park action was dismissed as a sanction for Mac Naughton’s defiance of the Order. The Seventh Circuit affirmed the dismissals of four other cases.Mac Naughton then sued Harmelech, seeking to set aside a purportedly fraudulent stock transfer to collect the RMG Judgment. The Seventh Circuit affirmed the suit's dismissal. This lawsuit was another attempt to circumvent the Holderman Order. Mac Naughton again argued that he did not violate Rule 1.9(a); he expects a New Jersey proceeding to vindicate him. But this dismissal was based on the Holderman Order, not Rule 1.9(a). Whether or not Mac Naughton violated his ethical duties as a New Jersey lawyer, he has a duty to comply with orders issued by Seventh Circuit courts. The appeal was frivolous; sanctions are warranted. View "Mac Naughton v. Asher Ventures, LLC" on Justia Law

G.G. ran away from home at age 13 and fell into the hands of a sex trafficker who used the now-defunct Backpage.com to advertise her. G.G. sued under the Trafficking Victims Protection Reauthorization Act, 18 U.S.C. 1595, which allows sex trafficking victims to recover damages from those who trafficked them and from anyone who “knowingly benefits … from participation in a venture which that person knew or should have known has engaged in” sex trafficking. She alleges that Salesforce should have known that Backpage.com was engaged in sex trafficking of minors. Salesforce had a close business relationship with Backpage—providing advice and custom-tailored software — and “knowingly benefited from its participation.”The Seventh Circuit reversed the dismissal of the case, rejecting arguments that a “venture” must be primarily a sex-trafficking venture; that a participant must have had constructive knowledge of the specific victim; that “participation in a venture” requires direct participation in a “common undertaking or enterprise involving risk and potential profit”; and that to knowingly benefit requires that the sex trafficker provide the participant with a benefit because of the participant’s facilitation of a sex-trafficking venture and that the participant must have known that this was the reason for the benefit. Those theories seek to impose restrictions on the civil remedy that are inconsistent with the statutory language. View "G.G. v. Salesforce.com, Inc." on Justia Law

Federal law establishes “[t]he Tuesday after the 1st Monday in November[] in every even-numbered year” as “the day for the election,” 2 U.S.C. 7. Illinois law allows mail-in ballots postmarked on or by Election Day to be counted if received up to two weeks after Election Day. The plaintiffs, State Congressman Bost, and two voters and former presidential electors, argued that this extended ballot counting violates federal law and filed suit against the State Board of Elections to enjoin the practice.Within a month, the Democratic Party of Illinois (DPI) filed a motion to intervene as a defendant under Federal Rule of Civil Procedure 24 in defense of the law. The Seventh Circuit affirmed the denial of DPI’s motion. DPI failed to point to any reason that the state’s representation of its interests “may be” inadequate, and the district court’s focus on public time and resources over DPI’s individual interests was not an abuse of its discretion. The court allowed DPI to proceed as amicus curiae if it decided to do so. View "Bost v. Democratic Party of Illinois" on Justia Law

In 2006 Ubiquity, a California-based company, contracted with North’s Illinois firm, Associates. North executed the contract in Arizona, where he lived, on behalf of Associates. Ubiquity promised to transfer 1.5% of its outstanding shares to Associates as a “commencement fee.” Ubiquity terminated the agreement two months after signing the contract and never transferred its shares. In 2013, when Ubiquity went public, North demanded specific performance, then sued Ubiquity for breach of contract in Arizona state court. The Arizona court denied Ubiquity’s motion to dismiss for lack of personal jurisdiction.North, worried about reversal on appeal, filed an identical breach-of-contract claim in the Northern District of Illinois in 2016. Ubiquity failed to appear. The district court entered a default judgment ($7 million). Ubiquity successfully moved to vacate the default judgment and dismiss the case for lack of personal jurisdiction. The court explained that Ubiquity’s only connection to Illinois was that it had contracted with an Illinois entity and that North, by his own admissions, had negotiated, executed, and promised to perform in Arizona. North filed an appeal but obtained a stay while his Arizona litigation proceeded. That stay remained in effect until 2023; by then North’s contract claim was time-barred in every relevant jurisdiction.The Seventh Circuit affirmed. Although the district court ought to have considered transferring the case to the Central District of California (28 U.S.C. 1631) North’s own representations would have fatally undermined his transfer request. View "North v. Ubiquity, Inc." on Justia Law

The Judicial Panel on Multidistrict Litigation (MDL) centralized cases arising out of alleged defects in Cook’s inferior vena cava (IVC) filters, 28 U.S.C. 1407(a). Many plaintiffs in the MDL claim that Cook’s filters cause pain and suffering, disabilities, emotional injuries, lost earnings, increased medical bills, and in some cases death. To help manage the litigation, the district court adopted direct filing and case categorization procedures. Parton and Sykes were each implanted with a Cook IVC filter. Years later, CT scans revealed that their filters had perforated their IVC walls. They experienced no pain or other symptoms, but they pursued product liability claims against Cook. The direct-filing procedure did not require Parton or Sykes to file a standard complaint; each filed a short-form complaint, which incorporated allegations from a master complaint that ostensibly applied to all direct-filing plaintiffs.The district court granted Cook summary judgment. The Seventh Circuit dismissed an appeal for lack of federal subject-matter jurisdiction. Jurisdiction in these cases is based solely on diversity of citizenship, which requires the amount in controversy in each case to exceed $75,000, 28 U.S.C. 1332(a). Parton and Sykes allege the proper amount in controversy, but the nature of their alleged injuries indicates that no more than $75,000 is at stake in either case. They have not suffered the injuries alleged in the master complaint; the allegations in their short-form complaints were inadequate. View "Parton v. Cook Medical, LLC" on Justia Law