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

Schutte retained a law firm to seek compensation for personal injuries. The firm requested electronic copies of Schutte’s medical records. Ciox produced the electronic copies but charged “Per Page Copy (Paper)” charges of $59.23 and an “Electronic Data Archive Fee” of $2.00. A Wisconsin statute lists specific maximum charges for paper, microfiche, or microfilm copies, X-ray prints, and for certification of copies, shipping, and retrieval. The statute is silent regarding charges for electronic copies.Schutte filed a putative class action, claiming that the class includes “several thousand persons and entities.” In addition to compensatory damages, she sought exemplary damages up to $25,000 per claimant, as authorized by Wisconsin law for “knowing and willful” violations. Ciox removed the action to federal court under the Class Action Fairness Act (CAFA), arguing: Schutte’s proposed class has at least 100 members; there is at least minimal diversity of citizenship between Schutte and the defendants; and based on the complaint’s allegations, the amount in controversy exceeds $5 million, 28 U.S.C. 1332(d).The Seventh Circuit affirmed the denial of a motion to remand to state court. Ciox provided a “plausible good faith estimate” that the amount in controversy exceeds $5 million. The local controversy exception does not apply because the factual allegations in a recent Montana class action against Ciox were “identical” to Schutte’s. View "Schutte v. Ciox Health, LLC" on Justia Law

Plaintiffs alleged that Hyles committed sexual abuse and assault at Hammond, Indiana's First Baptist Church, and its affiliated school, Hyles-Anderson College, in the late 1970s and that the institutions conspired to conceal the abuse. One plaintiff alleged that she paid fees and tithes to the institutions while being abused as a teenager. In 2020, they filed a civil claim under the federal Racketeer Influenced and Corrupt Organizations Act.The district court dismissed the complaint because the plaintiffs had not alleged the injury to “business or property” required for RICO’s civil cause of action, 18 U.S.C. 1962, 1964(c). The Seventh Circuit affirmed. The complaint alleges that the plaintiffs suffered personal injuries during the exercise of a property right (while expending money to participate in Church-related activities) that had an “indirect, or secondary effect” on the value of the property right. That is insufficient to satisfy the business or property element of a civil RICO claim. They contend that the institutions misappropriated their funds by using them to fund a sham investigation in the 2010s but did not describe how money paid in the 1970s could plausibly have been used to fund a phony investigation decades later. The allegations are too “speculative and amorphous” to permit their RICO claim to proceed. View "Ryder v. Hyles" on Justia Law

In May 2007, SunTrust hired Birch to perform a portfolio valuation on a property located in Indiana. The Birch report valued the property at $3.23 million. PNC Bank provided financing for the mortgage loan; both PNC and SunTrust accepted the report. In October 2007, the owner sold the property to a SunTrust affiliate subject to a $2.3 million loan PNC extended to SunTrust. The loan was later acquired by Regent. After consulting with independent appraisal experts, Regent hired a law firm and employed a certified appraiser, Potter, to evaluate the original Birch report. Potter’s report detailed several deficiencies in Birch’s 2007 appraisal.Regent filed a federal complaint, with state law claims, but soon moved to dismiss the complaint. Birch then filed its own lawsuit against Regent for malicious prosecution. Regent counterclaimed for attorney’s fees under the Indiana frivolous litigation statute. The district court dismissed both claims. The Seventh Circuit affirmed. Birch cannot establish the elements of a successful malicious-prosecution claim, but its lawsuit was not frivolous under Indiana law. Regent did not act maliciously in commencing the underlying action; it had probable cause based on advice from outside counsel, a detailed report by a certified appraiser, and justifiable reliance on the report. View "Birch Rea Partners, Inc. v. Regent Bank" on Justia Law

Cortez sued Cook, alleging that she was injured by an Inferior Vena Cava Filter, implanted in her in 2006 for the prevention of pulmonary embolisms. Cortez’s action was part of consolidated multidistrict proceedings. Accordingly, Cortez filed a Short‐Form Complaint that incorporated counts from the Master Consolidated Complaint for Individual Claims, alleging product liability, negligence, breach of express and implied warranty, and violations of Oregon’s Unlawful Trade Practices Act.Cook argued that the product liability claims were filed beyond the time period in the statute of repose of Cortez’s home state, Oregon. Cortez countered that the Oregon statute incorporates Indiana law because the product was manufactured there, which allows for equitable tolling of the limitations period, and that the complaint sufficiently alleged entitlement to tolling based on fraudulent concealment. She alleged that Cook knew the product was defective and, through affirmative misrepresentations and omissions, actively concealed significant risks, continuing to promote the Filter as safe and effective even though inadequate clinical trials had been performed.The district court dismissed the claims, finding the allegations insufficient to demonstrate fraudulent concealment. The Seventh Circuit affirmed, applying Indiana law. Because these product liability claims are subject to a statute of repose, and fraudulent concealment cannot extend the time to file claims for such a statute, the claims are untimely. View "Cortez v. Cook Inc." on Justia Law

Farnolo helped his clients file short‐form complaints in the multidistrict “Cook” litigation, involving product liability claims alleging injuries caused by Cook’s medical device—a filter designed to prevent pulmonary embolism. The case management order instructed all plaintiffs to complete a profile form with general personal and medical background information and details about their device and alleged injuries. In May 2019, the defendants notified attorney Farnolo that they did not have forms from his four clients. By late June, the forms still had not been filed. Farnolo never responded to the defendants' motion to dismiss.The district court dismissed the cases on July 19, 2019. Farnolo learned about the dismissal not by monitoring the docket, but from his client more than a year later. On August 18, 2020, he moved for reconsideration and reinstatement of the cases, claiming that he did not receive an electronic docket notification of the motion to dismiss; he attributed his delay in asking for reconsideration to his email inbox sending the dismissal order to his junk folder. The district court denied Farnolo’s motion as both untimely and meritless. The Seventh Circuit affirmed; all Rule 60(b) motions must be made within a “reasonable time” and Rule 60(c)(1) specifically requires requests for reconsideration predicated on excusable neglect to be brought within one year of entry of judgment. Inexcusable attorney negligence is not an exceptional circumstance justifying relief. View "Sides v. Cook Medical Inc." on Justia Law

Nichols prevailed in a discrimination action against his employer. The district court awarded Nichols $300,000 in compensatory damages and various forms of equitable relief, including back pay and pension contributions as well as reinstatement. Two years later, the district court awarded his attorney (Longo) $774,645.50 on a post‐trial motion for statutory attorney’s fees. While Longo’s appeal proceeded, Nichols filed a district court motion to adjudicate attorney’s fees and for other relief. He had executed a contingency fee agreement before filing the underlying discrimination action, and he challenged Longo’s assertion that he had a right to 45% of the entire relief, including the total monetary award and all equitable relief. Longo contended that he was entitled to that amount under the contingency fee arrangement in addition to the entire statutory attorney fees award. Nichols argued that Longo’s fee demand is excessive and violates Illinois Supreme Court Rule 1.5 because the contingency agreement itself was unconscionable.The district court, while expressing concern about Longo’s position, determined that its jurisdiction did not extend to attorney fee disputes after the case has been dismissed and jurisdiction has been relinquished. The Seventh Circuit affirmed the statutory attorney fee award. The district court correctly determined that the contingency contract dispute is not within its jurisdiction. View "Nichols v. Longo" on Justia Law

In October 2018, a Boeing 737 MAX airliner crashed in the sea near Indonesia, killing everyone on board. In March 2019, a second 737 MAX crashed in Ethiopia, again killing everyone on board. Within days of the second crash, all 737 MAX airliners around the world were grounded. The FAA kept the planes grounded until November 2020, when it was satisfied that serious problems with the planes’ flight control systems had been corrected. The Pension Plan, a shareholder of the Boeing Company, filed a derivative suit on behalf of Boeing under the Securities Exchange Act of 1934, 15 U.S.C. 78n(a)(1), alleging that Boeing officers and board members made materially false and misleading public statements about the development and operation of the 737 MAX in Boeing’s 2017, 2018, and 2019 proxy materials.The district court dismissed the suit without addressing the merits, applying a Boeing bylaw that gives the company the right to insist that any derivative actions be filed in the Delaware Court of Chancery. The Seventh Circuit reversed. Because the federal Exchange Act gives federal courts exclusive jurisdiction over actions under it, applying the bylaw to this case would mean that the derivative action could not be heard in any forum. That result would be contrary to Delaware corporation law, which respects the non-waiver provision in Section 29(a) of the federal Exchange Act, 15 U.S.C. 78cc(a). View "Seafarers Pension Plan v. Bradway" on Justia Law

In 2016, Lax raised concerns about discrimination. After notification of his right to file a formal complaint, Lax filed a formal complaint of disability discrimination against his employer (DHS), alleging he had been improperly placed on indefinite suspension and had his security clearance suspended after he checked himself into a hospital for mental health treatment and missed two days of work.DHS's final agency decision, rejecting Lax’s complaint, was sent to Lax’s work email address on July 17, 2019. One minute later, Lax was sent the password to open an attachment, which contained: the final decision, a “Notice of Appeal Rights,” a privacy statement, and a certificate of service. The “Notice of Appeal Rights” stated that Lax had the right to file suit in federal court within 90 days of receiving the final decision. Lax concedes that he opened these emails and read them on the day they were sent but claims that he was unable to open the attached document until the next day; government security measures prevented him from accessing his work email account on any non-work device.On October 16, 2019 (91 days after July 17), Lax filed suit. The Seventh Circuit affirmed the dismissal of the suit as untimely under 42 U.S.C. 2000e5(f)(1). Lax did not satisfy the extraordinary circumstances element for equitable tolling. View "Lax v. Mayorkas" on Justia Law

Cothron works as a manager at an Illinois White Castle restaurant where she must scan her fingerprint to access the restaurant’s 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. She brought a proposed class-action lawsuit on behalf of all Illinois White Castle employees. White Castle argued that a claim accrued under the Act the first time Cothron scanned her fingerprint into the system after the law took effect in 2008, making her suit untimely. Cothron responded that every unauthorized fingerprint scan amounted to a separate violation of the statute, so a new claim accrued with each scan.The district judge rejected White Castle’s “one time only” theory but certified an interlocutory appeal under 28 U.S.C. 1292(b). The Seventh Circuit certified the question to the Illinois Supreme Court: Do section 15(b) and 15(d) 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, or only upon the first scan and first transmission? View "Cothron v. White Castle System, Inc." on Justia Law

The Judicial Panel on Multidistrict Litigation (MDL) asked the Southern District of Indiana to oversee a multidistrict litigation docket to coordinate discovery and other pretrial proceedings in thousands of medical product-liability suits, alleging that Cook’s inferior vena cava (IVC) filters were defective. The court and the parties agreed to a procedure by which new plaintiffs could join the MDL by filing directly in the Southern District of Indiana rather than filing in their home districts and waiting for the judiciary’s administrative machinery to transfer their cases to the MDL in Indiana. The plaintiffs filed their lawsuits directly in the Indiana MDL rather than filing in the states where they lived and had their IVC filters implanted.Cook moved to dismiss both cases based on Indiana’s two-year statute of limitations for personal injury actions. The plaintiffs’ home states (South Carolina and Mississippi) have three-year statutes. The Seventh Circuit reversed the dismissal of the suits. The unique facts of this case indicate that Cook implicitly consented to using choice-of-law rules for these plaintiffs as if they had filed in their home states. It was not fair to allow Cook to change positions retroactively to dismiss these plaintiffs’ cases that had been timely filed under the “law of the case.” View "Looper v. Cook Inc." on Justia Law