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

Taylor’s brother died in an accident. Caiarelli, the decedent’s ex-spouse and guardian of their minor child, obtained a state court declaration that the child was entitled to assets distributed to Taylor ($1.4 million). The estate assigned the judgment to Caiarelli. Taylor sought a probate court declaration that the assignment was void. Before resolution, Taylor filed for Chapter 11 bankruptcy, triggering the automatic stay. Caiarelli initiated an adversary proceeding, objecting to discharge of the judgment. The bankruptcy court dismissed, finding that Caiarelli failed to establish standing. The judgment was discharged, and Taylor’s creditors enjoined from collecting, 11 U.S.C. 524(a)(2). Caiarelli returned to probate court, which ratified the assignment. Taylor claimed that Caiarelli and her attorneys violated the discharge and plan injunctions. The bankruptcy court entered a civil contempt order and issued a damages order and judgment for $165,662.36 in attorney’s fees. While appeal was pending, Taylor notified the district court that he reached a settlement with the legal malpractice insurance carrier for Caarelli’s attorneys. The attorneys denied that a full settlement had been reached. The bankruptcy court indcated that vacatur would be approved if the parties returned to the court, so the district court denied Taylor’s motion to dismiss but reversed the contempt order, damages order, and judgment, finding no violation of the statutory discharge or plan injunctions. The Seventh Circuit affirmed, finding that the appeal was not moot. View "Taylor v. Caiarelli" on Justia Law

The Higginses visited an Indiana amusement park. The filter pump connected to the park’s lazy river malfunctioned. As staff worked to fix the problem, pool chemicals—bleach and hydrochloric acid—accumulated in the pump. When the pump restarted, the chemicals discharged into the water and a cloud of chlorine gas released into the air. The Higginses were not nearby, but their niece was, and they received a cell phone call, prompting them to head in that direction. When they arrived, Kent Higgins inhaled an unspecified amount of chemical fumes that lingered. Complaining of chest tightness, burning eyes, shortness of breath, and nausea, Higgins visited the emergency room, where he was diagnosed with “mild chemical exposure” and discharged with instructions to follow up with his primary care physician. Higgins saw a pulmonologist later that summer, but waited more than a year before consulting his primary physician. He was diagnosed with reactive airways dysfunction syndrome and chronic asthma more than 14 months after the incident. In his negligence suit, the court disqualified Higgins's expert concerning causation. The Seventh Circuit affirmed and agreed that the causation issue was too complex for an unassisted jury and that Higgins’s treating physician’s qualifications and methodology were too uncertain to permit her to opine on such matters. View "Higgins v. Koch Dev. Corp." on Justia Law

In 2013, hackers attacked Neiman Marcus and stole the credit card numbers of its customers. In December 2013, the company learned that some of its customers had found fraudulent charges on their cards. On January 10, 2014, it publicly announced that the cyberattack had occurred and that between July 16 and October 30, 2013, and approximately 350,000 cards had been exposed to the hackers’ malware. Customers filed suit under the Class Action Fairness Act, 28 U.S.C. 1332(d). The district court dismissed, ruling that the individual plaintiffs and the class lacked Article III standing. The Seventh Circuit reversed, finding that the plaintiffs identified some particularized, concrete, redress able injuries, as a result of the data breach. View "Remijas v. Neiman Marcus Group, LLC" on Justia Law

Townsend signed a note and a mortgage to purchase a condominium. After Townsend defaulted, HSBC sought foreclosure under Illinois law. Representing himself, Townsend answered the complaint. HSBC moved for summary judgment, submitting evidence of default; that Townsend owed $141,425.65; and that HSBC owned the note and mortgage. Townsend failed to respond. The court entered a judgment of foreclosure, an order finding that Townsend owed $143,569.65, and an order providing for judicial sale if Townsend did not pay before the redemption period expired. The court wrote that the judgment was “a final and appealable order” that was “fully dispositive” under Federal Rule of Civil Procedure 54(b), but retained jurisdiction to enforce or vacate (in the event of reinstatement) the judgment. The court acknowledged that it might have to hold a hearing to confirm the judicial sale under Illinois law and could decide not to confirm, if appropriate parties did not receive proper notice, if sale terms were unconscionable, if the sale was conducted fraudulently, “or … justice was otherwise not done.” The Seventh Circuit dismissed an appeal for lack of jurisdiction. The judgment of foreclosure and judicial sale posed no imminent threat of irreparable harm to Townsend. His interests are protected under Illinois law. Because entry of the Rule 54(b) judgment compelled Townsend to appeal when he did, the court ordered that costs on appeal be assessed against HSBC. View "HSBC Bank USA, N.A. v. Townsend" on Justia Law

This appeal concerns the District's construction of an ambitious project to impound water until it can be cleaned up and released safely: the Tunnel and Reservoir Plan (TARP). The United States and the State of Illinois jointly filed suit, under sections 301 and 309 of the Clean Water Act, 33 U.S.C. 1311, 1319, seeking an order that the District improve the TARP’s performance, accelerate its completion date, and do more to contain and mitigate overflows in the interim. The Alliance was permitted to intervene. The district court entered a proposed consent decree that accompanied the complaint and rejected the Alliance's protest of the proposal. The district judge also concluded that the settlement binds the Alliance. The Alliance appealed, arguing that it cannot be bound by the consent decree - essentially a contract - to which it did not agree. The court concluded that the consent decree that the district court has approved is reasonable in light of the current infrastructure, the costs of doing things differently (no one proposes to build a new sewer system or redo the Deep Tunnel project), and the limits of knowledge about what will happen when the system is completed. Because the decree is the outcome of diligent prosecution, it binds would-be private litigants such as the Alliance. Accordingly, the court affirmed the judgment. View "United States v. Metropolitan Water Reclamation" on Justia Law

Plaintiffs, airplane passengers, filed suit against Boeing in state court after a Boeing 777 hit a seawall at the end of a runway at the San Francisco International Airport and injured 49 passengers, killing three passengers. Suits were also brought in federal courts and were consolidated by the Panel on Multidistrict Litigation (MDL) under 28 U.S.C. 1407(a). Boeing removed the state suits to federal court, asserting admiralty jurisdiction under 28 U.S.C. 1333 and asserting federal officials' right to have claims against them resolved by federal courts under 28 U.S.C. 1442. The MDL decided that the state suits should be transferred to California to participate in the consolidated pretrial proceedings, but the district court remanded them for lack of subject-matter jurisdiction. The court agreed with the district court that Boeing was not entitled to remove under section 1442(a)(1) because Boeing was not acting as a federal officer in light of Watson v. Philip Morris Cos. However, the court concluded that subject-matter jurisdiction exists under section 1333(1) because section 1333(1) includes accidents caused by problems that occur in transocean commerce. In this case, the plane was a trans-ocean flight, a substitute for an ocean-going vessel. Accordingly, the court reversed the district court's judgment and remanded with instructions. View "Lu Junhong v. Boeing Co." on Justia Law

Choice Hotels sued SBQI, its managers, and investors, for breach of a franchise agreement. The defendants did not answer the complaint. The court entered a default. One defendant, Chawla, an Illinois attorney, had represented the others. Other defendants asked Chawla to find a new attorney. They claimed that they had been unaware that their signatures were on the franchise agreement and that the signatures are forgeries. Johnson agreed to try to vacate the default, negotiate a settlement, and defend against the demand for damages. Johnson filed an appearance and took some steps, but did not answer the complaint or move to vacate the default, engage in discovery concerning damages, or reply to a summary judgment motion on damages. In emails, Johnson insisted that he was trying to settle the litigation. He did not return phone calls. The court set damages at $430,286.75 and entered final judgment. A new attorney moved to set aside the judgment more than a year after its entry, under Fed. R. Civ. P. 60(b)(6), which covers “any other reason that justifies relief” and requires “extraordinary circumstances.” The Seventh Circuit affirmed. The defendants must bear the consequences of their inaction. They were able to monitor the proceedings, but did not follow through. View "Choice Hotels Int'l Inc. v. Grover" on Justia Law

Moje, playing minor league hockey, lost an eye during a game, and sued Oakley, which made his visor, and the League. Instead of notifying its insurer, the League hired LoFaro. Oakley’s attorney called the League’s President, to ask why it had not answered the complaint. LoFaro claimed that an answer had been filed, but the docket did not reflect any filing. Moje moved for default. LoFaro did not respond, nor did he respond after the court entered the default and permitted Moje to prove damages. The court entered a final judgment of $800,000 against the League. After the League learned of collection efforts, it notified its insurer. A lawyer hired by the insurer unsuccessfully moved, under Fed. R. Civ. P. 60(b)(1) to set aside the judgment within six months of its entry. Rule 60(b)(1), allows relief on account of “mistake, inadvertence, surprise, or excusable neglect.” The Seventh Circuit affirmed. Abandoned clients who take reasonable steps to protect themselves can expect to have judgments reopened under Rule 60(b)(1), but the League is not in that category. Its remedy is against LoFaro. View "Moje v. Federal Hockey League LLC" on Justia Law

In 1982, Gacho was arrested, along with others, and confessed his involvement in two murders, signing a written statement. Gacho and Titone stood trial in Judge Maloney’s court. Gacho’s girlfriend was the star prosecution witness, having witnessed the key events. Her testimony largely aligned with Gacho’s confession, which was admitted at trial. The jury found Gacho guilty in 1984 and he was sentenced to death. Judge Maloney was corrupt; he has “the dubious distinction of being the only Illinois judge ever convicted of fixing a murder case.” Gacho claims that Maloney solicited a bribe from him but his family could not raise the money. Titone’s family paid Maloney $10,000 to fix his case, but he was convicted anyway. Gacho also claims that his trial lawyer, McDonnell, the son-in-law of Sam Giancana, longtime boss of the Chicago Outfit, was operating under an impermissible conflict of interest and was otherwise ineffective. The district court dismissed, without prejudice his most recent federal habeas petition for failure to exhaust state court remedies, 28 U.S.C. 2254. The Seventh Circuit dismissed his appeal for lack of jurisdiction. The district court issued a non-final, non-appealable order. Gacho may refile his petition after he exhausts state remedies. View "Gacho v. Butler" on Justia Law

Gonzalez-Koeneke worked, for 12 years, as a Rockford School District bus driver. She experienced problems with children on her bus and filed incident reports with Sharp and, later, went to West, the terminal manager. She was told that she did not know how to discipline the children and was later suspended for two days for failing to perform a proper pre-trip inspection of her bus. Gonzalez-Koeneke claims that her suspension was actually retaliation for having gone to West. Her union steward told her that Wilson (a District official) wanted her to quit, but Wilson issued a “Removal Form” that same day, resulting in suspension of her bus-driver permit for three years. Gonzalez-Koeneke was terminated based on her suspended permit. She filed suit pro se, alleging violation of the Civil Rights Act, 42 U.S.C. 1981, and 42 U.S.C. 1983. The court dismissed with prejudice, noting its standing order that a dismissal is with prejudice unless a party requests an opportunity to amend in its response. Gonzalez-Koeneke moved to set aside the judgment and to amend her complaint. The district court denied the motion, stating that she had not explained how she would amend the complaint to cure the deficiencies identified in the order. The Seventh Circuit affirmed. View "Gonzalez-Koeneke v. West" on Justia Law