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

In 2013, a Chicago Best Buy store's manager warned the Plaintiffs that plasma‐screen televisions frequently experienced longevity problems, and encouraged them to buy a five‐year extended warranty, the “Geek Squad Protection Plan.” They bought a Samsung 64‐inch plasma‐screen television for $3,119.99 and the Plan for another $519.99. The television broke down after four years. Best Buy could not repair it. The Plan provided that if the television could not be repaired, Best Buy could elect either to replace the television or to compensate the consumer with a gift card. Best Buy provided a gift card, the value of which was keyed to the current market price of a new television of similar quality to the one purchased in 2013.The Plaintiffs filed a purported class action under the Magnuson‐Moss Warranty Act, 15 U.S.C. 2301, which requires that if a warrantied consumer good cannot be repaired, the written warranty must give the consumer a choice of remedy: either a replacement or a refund of the purchase price, less reasonable depreciation. They argued that the Plan is a full “written warranty” and that Best Buy’s unilateral decision to provide the gift card failed to provide consumers with the choice. The Seventh Circuit affirmed the dismissal of the case. For purposes of diversity jurisdiction, the Wares have not met the amount‐in‐controversy requirement. View "Tawanna Ware v. Best Buy Stores" on Justia Law

Talevski, living with dementia, was a patient at Valparaiso Care, a state-run Indiana nursing facility. His wife filed suit under 42 U.S.C. 1983 for violations of the Federal Nursing Home Reform Act (FNHRA), 42 U.S.C. 1396r, which establishes the minimum standards of care to which nursing-home facilities must adhere in order to receive federal funds in the Medicaid program. Some of the requirements relate to residents’ rights, including two cited by Talevski, the right to be free from chemical restraints imposed for purposes of discipline or convenience rather than treatment and the right not to be transferred or discharged unless certain criteria are met.The district court dismissed the action, finding that FNHRA does not provide a private right of action that may be redressed under 42 U.S.C. 1983. The Seventh Circuit reversed. The section 1983 remedy broadly encompasses violations of federal statutory as well as constitutional law. The court noted the express rights-creating language in the statute and that FNHRA is not the type of comprehensive enforcement scheme, incompatible with individual enforcement. The right protected by the statute is not so vague and amorphous that its enforcement would strain judicial competence. View "Talevski v. Health and Hospital Corp. of Marion County" on Justia Law

Under the Indiana Video Service Franchises Act of 2006, anyone offering “video service” must enter into a franchise agreement with the Indiana Utility Regulatory Commission in exchange for use of a public right-of-way. For years, traditional cable and communications companies like Comcast and AT&T have signed the franchise agreements and paid the required fees to government “units,” including counties, municipalities, or townships within the provider’s service area. Recently, traditional cable television has been supplanted in many ways by on-demand streaming platforms like Netflix; some cities concluded that streaming platforms offer “video service” within the meaning of the Act. The streaming platforms have not done so and have avoided the Act’s fee obligations.In 2020, several cities filed a putative class action against Netflix, Disney, Hulu, DIRECTV, and DISH Network, seeking a declaration that the defendants are subject to the Act and must pay past and future franchise fees. The defendants removed the case to federal court under 28 U.S.C. 1441 and 1453. . Invoking the comity abstention doctrine articulated by the Supreme Court in Levin v. Commerce Energy (2010), the district court remanded. The Seventh Circuit affirmed. Indiana courts are well-positioned to interpret (for the first time) the state’s Video Service Franchises Act and to resolve any federal defenses raised by the streaming platforms. View "City of Fishers, Indiana v. DIRECTTV" on Justia Law

Smith worked for PTI, a company that transports railroad crews to and from their workplaces. Believing that her position was misclassified under the Fair Labor Standards Act and that she was not receiving proper overtime wages, she filed a collective action 29 U.S.C. 216(b). Unlike a class action under FRCP 23(b)(3), an FLSA collective action requires group members to affirmatively opt-in to participate. Her suit was within the two-year limitation period. The district court’s docket sheet shows numerous putative group members consenting to opt-in.PTI noted that Smith had not filed anything except her complaint indicating that she herself wished to participate in the group action. The court held that Smith’s group action could not “commence” until such consent was filed, 29 U.S.C. 256, but the limitations periods had run. The court concluded that Smith’s complaint also failed to allege timely individual claims, and dismissed the case. Smith’s appeal concerned only her individual action. The Seventh Circuit vacated. The court erred by refusing to allow Smith to proceed on her individual claims. Read in the light most favorable to Smith, the complaint contained sufficient factual allegations related to her individual claims to put PTI on notice that she intended to sue it both in an individual and a representative capacity. She explicitly stated as much in the caption. View "Smith v. Professional Transportation,Inc." on Justia Law

ERISA-covered employee benefit funds filed suit to hold a newly formed, family-run plumbing company liable for an existing ERISA judgment on the basis that it stepped into the predecessor family company’s obligations. The funds cited the federal common law doctrine of successor liability and contended that was enough to show their claim arose under federal law and raised a federal question properly in federal court under 28 U.S.C. 1331. The district court agreed, proceeded to the merits, and concluded it would be inequitable to hold the new entity responsible for the other’s unpaid plan contributions on a theory of successor liability.The Seventh Circuit vacated, stating the suit must be dismissed. The reliance on federal common law alone does not suffice to show a claim “arising under” federal law for purposes of establishing federal question jurisdiction. Supreme Court precedent indicates that in these circumstances the funds needed to identify a source of law supplying them a federal cause of action—a federal law authorizing them to sue in federal court on their claim. Section 1331, the federal question jurisdiction statute, does not itself create or supply that cause of action here. Nor have the funds identified any other statute authorizing their action in federal court. View "East Central Illinois Pipe Trades Health & Welfare Fund v. Prather Plumbing & Heating, Inc." on Justia Law

Linda and her husband Milton set up an estate plan with the help of attorney Roth. Milton created a trust and designated himself as sole trustee. Upon his death, Linda and his accountant, Sanders, would become cotrustees. Milton’s assets included a $1.5 million Vanguard account. Milton later changed the Vanguard account and other accounts to transfer on death directly to Linda as the sole primary beneficiary. Milton died in 2016. Linda believed that Roth was still her attorney. Roth and Sanders convinced Linda to waive her rights as co-trustee and to disclaim her interest in the Vanguard account; they suggested that she had acquired these interests through wrongdoing. Roth then transferred the disclaimed Vanguard account directly to Milton’s son, David, instead of to the trust. David sued Linda and obtained an Indiana state court judgment that she exerted undue influence on Milton and that the trust was the proper owner of certain assets Milton had transferred to Linda.Linda sued in federal court, asserting fraud, conspiracy, and malpractice against Roth and Sanders, claiming the two “duped” her into disclaiming certain assets and that Roth committed malpractice by transferring the account to David rather than the trust. The Seventh Circuit affirmed the dismissal of the suit; issue preclusion based on the Indiana judgment foreclosed Linda’s claims because the Indiana jury’s finding of undue influence showed that Roth and Sanders’s advice to disclaim her illegally-obtained interests was neither negligent nor fraudulent. View "Bergal v. Roth" on Justia Law

The Vermilion Power Station operated until 2011, burning coal and generating coal ash that was mixed with water and deposited into unlined pits, close to the Middle Fork of the Vermilion River, navigable water protected by the Clean Water Act. A National Pollutant Discharge Elimination System permits the discharge of wastewater from the station’s operations into the Middle Fork, 33 U.S.C. 1342(b). PRN, a nonprofit environmental group, sued, alleging the permit does not authorize the coal ash seepage into the groundwater, which then enters the Middle Fork. Because PRN’s individual members “live near, study, work, and recreate in and around, the Middle Fork, including in the vicinity of the Vermilion Power Station,” PRN maintains it has an interest in stopping and remedying these alleged discharges, which degrade the Middle Fork’s water quality and its “aesthetic beauty and ecological vitality.” The district court held that the Act does not regulate groundwater discharges, even when that groundwater connects to regulated surface waters. The Seventh Circuit stayed PRN’s appeal pending the Supreme Court’s 2020 “County of Maui” decision, which established a multi-factor test to determine whether groundwater discharges fall under the Clean Water Act’s ambit. The court then declined to assess "Maui’s" reach, concluding that PRN lacks standing. PRN has more than 1000 members yet fails to show that at least one of those individuals has standing. Associational standing requires more specificity. View "Prairie Rivers Network v. Dynegy Midwest Generation, LLC" on Justia Law

Daza worked as a geologist for INDOT from 1993 until the agency fired him in 2015. In 2017, he sued, citing 42 U.S.C. 1981 and 1983, the First and Fourteenth Amendments, the Age Discrimination in Employment Act, 29 U.S.C. 621, and the Americans with Disabilities Act, 42 U.S.C. 12101. He alleged that INDOT and its officials had discriminated against him based on race, color, age, and political speech and had retaliated against complaints he made regarding the alleged discrimination.Days after the district court granted INDOT summary judgment in 2018, Daza filed a second action, again alleging discrimination and retaliation based on race, color, age, and political speech, contending that INDOT’s failure to rehire him for the vacancy left after INDOT dismissed him was an independent act of discrimination and retaliation because INDOT filled his position with a young and inexperienced white man. In the first suit, Daza had expressly contended that INDOT’s failure to rehire him and its decision to hire an unqualified replacement proved that INDOT was attempting to cover up its discrimination and retaliation. The Seventh Circuit again affirmed summary judgment in favor of INDOT. Claim preclusion barred the second case. View "Daza v. Indiana" on Justia Law

The Loughrans defaulted on their home mortgage in 2011. In the ensuing foreclosure litigation, the Loughrans pursued procedural delay tactics; they remain in possession of their home despite not having made a mortgage payment in nine years. In 2019, with their state‐court foreclosure litigation more than seven years old, the Loughrans accused U.S. Bank and its counsel of committing fraud in the course of those proceedings. Months later, sensing that their fraud claim was going nowhere, the Loughrans went to federal court, with a complaint that copied and pasted large swaths of text from their state‐court filings.The district court stayed the federal proceedings, noting the practical identity between the federal and state actions. The Seventh Circuit affirmed, first concluding that it had appellate jurisdiction because the stay order was entered with the expectation that the state litigation would “largely” resolve the federal litigation. The district court properly stayed the case; the state action will likely “dispose of a majority of the factual and legal issues,” so a stay saved judicial resources. At the time of the order, the state‐court proceedings were well advanced, The Loughrans essentially were asking the federal judiciary to monitor and discipline how parties conduct themselves in state court. View "Loughran v. Wells Fargo Bank, N.A." on Justia Law

Page, a former advisor to the Trump Presidential Campaign, sued the Democratic National Committee, a subsidiary DNC Corporation, the Perkins law firm, and two Perkins partners. Page alleged defamation based on news stories published in 2016 concerning contacts between the campaign and Russian officials. Having advanced only violations of state law, and alleging that no defendant is a citizen of his home state of Oklahoma, Page relied on diversity jurisdiction. The district court dismissed the case for lack of personal jurisdiction.The Seventh Circuit affirmed, citing the lack of subject matter jurisdiction on the basis that Perkins (with a few of its U.S.-based partners working and living abroad) does not qualify as a proper defendant for purposes of diversity jurisdiction under 28 U.S.C. 1332. Though complete diversity typically hinges on whether any parties on both sides of a lawsuit share citizenship, all parties must fall within the jurisdiction created by the diversity statute. If a party cannot sue or be sued under a provision of the diversity statute, the suit lacks complete diversity. Stateless citizens—because they are not (by definition) a citizen of a state, as section 1332(a) requires—destroy complete diversity just as much as a defendant who shares citizenship with a plaintiff. View "Page v. Democratic National Committee" on Justia Law