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

Plaintiff found a $20 parking citation on his windshield and initiated a class action, claiming that the inclusion of personal information, such as his driver's license number, address, and weight, violated the Driver's Privacy Protection Act, 18 U.S.C. 2721, which generally makes it unlawful to disclose personal information contained in a motor vehicle record. The district court dismissed and the Seventh Circuit initially affirmed. On rehearing, en banc, the court reversed, holding that the DPPA’s general rule of non-disclosure of personal information held in motor vehicle records and its overarching purpose of privacy protection must inform a proper understanding of the other provisions of the statute. Any disclosure must comply with those legitimate uses of information identified in the statutory exceptions. The Village’s placement of protected personal information in view of the public constituted a disclosure regulated by the statute, regardless of whether plaintiff can establish that anyone actually viewed it. View "Senne v. Vill. of Palatine" on Justia Law

Travelers sought a declaratory judgment that they had no duty to defend their insured, Rogan Shoes, in an Illinois state court class action for violations of the federal Fair and Accurate Credit Transactions Act, 15 U.S.C. 1681c(g), which prohibits businesses from including on sales receipts the expiration date or more than the last five digits of the purchaser’s credit or debit card and authorizes damages of up to $1,000 per unlawful receipt. The suit sought statutory damages of $387 million. Rogan settled for $16 million; the settlement specified that the judgment would be satisfied only through proceeds from Travelers’ policies, with the exception of $50,000 to cover legal costs. Rogan assigned its claims and rights to payments under the policies. The state court approved the settlement. A state court citation to discover assets was served on Travelers’ agent. The district court dismissed the declaratory judgment action on the ground that parallel state proceedings were pending. The Seventh Circuit affirmed, finding that the case did not satisfy the amount-in-controversy requirement for diversity jurisdiction, 28 U.S.C. 1332(a), because Rogan had assigned its interests in its policies to class members, none of whom individually claim a share of more than $75,000. View "Travelers Prop. Cas. & Travelers Indem. Co. v. Good" on Justia Law

In a class action under ERISA, the district court partially decertified the class, 3000 to 3500 members (57 to 71 percent). Plaintiffs appealed under Rule 23(f), which authorizes a court of appeals to “permit an appeal from an order granting or denying class-action certification.” After holding that an order materially altering a previous order granting or denying class certification is within the scope of Rule 23(f), the Seventh Circuit denied the appeal for failure to satisfy the criteria for a Rule 23(f) appeal. View "Matz v. Household Int'l Tax Reduction Inv. Plan" on Justia Law

Plaintiffs are current and former drivers for FedEx delivery service who allege that they were employees rather than independent contractors under the laws of the states in which they worked and under federal law. The district court used the Craig. case, which was based on ERISA and Kansas law, as its “lead” case; certified a nationwide class seeking relief under ERISA and certified statewide classes under FRCP 23(b)(3). The Kansas class has 479 members. They allege that they were improperly classified as independent contractors rather than employees under the Kansas Wage Payment Act, Kan. Stat. 44-313, and that as employees, they are entitled to repayment of costs and expenses they paid during their time as FedEx employees. They also seek payment of overtime wages. The district court granted FedEx summary judgment in Craig and other cases; 21 cases are on appeal. The Seventh Circuit stayed proceedings and certified questions to the Kansas Supreme Court: Given the undisputed facts, are the plaintiff drivers employees of FedEx as a matter of law under the KWPA? Drivers can acquire more than one service area from FedEx. Is the answer different for plaintiff drivers who have more than one service area? View "Craig v. FedEx Ground Package Sys., Inc." on Justia Law

Former inmates of Cook County Jail filed a class action under 42 U.S.C. 1983, charging that failure to provide more than a single dentist to 10,000 inmates constitutes cruel and unusual punishment, violating the Eighth Amendment and the due process clause. Although some are convicts, most are pretrial detainees, to whom the cruel and unusual punishments clause does not apply; the due process clause has been interpreted to provide equivalent protection. Two district judges denied class certification, but in a third materially identical suit, the judge granted certification after the Supreme Court held that "neither a proposed class action nor a rejected class action may bind nonparties." The Seventh Circuit granted the Rule 23(f) appeal from certification, limited to whether a district court, in deciding class certification, should "defer, based on the principles of comity, to a sister court's ruling on a motion for certification of a similar class." The court upheld the certification as not precluded, while noting that it could be incorrect. Without a rule of preclusion, class action lawyers can keep bringing identical class actions with new representatives until they draw a judge who is willing to certify the class, but preclusion is not the solution.

A suit seeking to represent a class of inmates at the “supermax” Tamms Correctional Center, alleging due process violations, was dismissed. The Seventh Circuit reversed. While remand was pending, the Illinois Department of Corrections developed a “Ten-Point Plan,” revising procedures for transferring inmates to Tamms, with a detailed transfer-review process. Although it had not been implemented, IDOC submitted the Plan at trial. The court held that conditions at Tamms impose atypical and significant hardship, establishing a due-process liberty interest in avoiding transfer to Tamms, and that procedures for transfer decisions were unconstitutional. The court entered an injunction incorporating the Ten-Point Plan. The Seventh Circuit vacated. The scope and specificity of the injunction exceed what is required to remedy the due process violation, contrary to the Prison Litigation Reform Act, 18 U.S.C. 3626(a)(1)(A), and to Supreme Court statements about remedial flexibility and deference to prison administrators in this type of litigation. Injunctive relief to remedy unconstitutional prison conditions must be “narrowly drawn,” extend “no further than necessary” to remedy the violation, and use the “least intrusive means” to correct the violation of the federal right. Making the Plan a constitutional baseline eliminated operational discretion and flexibility, exceeding what due process requires and violating the PLRA.

The Telephone Consumer Protection Act, 47 U.S.C. 227, curtails use of automated dialers and prerecorded messages to cell phones, whose subscribers often are billed for the call. AT&T hired a bill collector to call cell phone numbers at which customers had agreed to receive calls. The collection agency used a predictive dialer that works autonomously until a human voice answers. Predictive dialers continue to call numbers that no longer belong to the customers and have been reassigned to individuals who had not contracted with AT&T. The district court certified a class of individuals receiving automated calls after the numbers were reassigned and held that only consent of the subscriber assigned the number at the time of the call justifies an automated or recorded call. The Seventh Circuit affirmed.

The Thorogood lawsuit against Sears, characterized as "near frivolous," concerned marketing of a clothes dryer. It was certified and later decertified as a class action on the ground that no issues could be resolved in a single, class-wide evidentiary hearing, and was ultimately dismissed. Murray, a member of the proposed class, who did not become a party, filed a "copycat" class action, using the same attorney. Following a third visit to the Seventh Circuit, the district court enjoined the Murray suit as defiant of the decertification. The Supreme Court remanded. The Seventh Circuit consolidated the Thorogood and Murray cases for its fourth opinion. On the merits, the court stated that "One would have to have a neurotic obsession with rust stains (or be a highly imaginative class action lawyer) to worry about Sears' drum," and that it would "unsay nothing," in its previous opinions, but vacated the injunction. "We were wrong. The Supreme Court’s decision—rendered after we ordered the injunction … although it does not refer to the All Writs Act, inclines us to doubt that Murray, not having been a party to the Thorogood suit, can nevertheless be bound by a ruling in it, including the ruling decertifying the class."

Plaintiff sued Allstate on behalf of a putative class, alleging a nationwide pattern or practice of sex discrimination in violation of Title VII of the Civil Rights Act, 42 U.S.C. 2000e, and the Equal Pay Act, 29 U.S.C. 206(d). She alleged gender-based earning disparities based on salary, promotion, and training policies that left significant discretion in the hands of individual managers. The district court denied class certification. In response to enactment of the Lilly Ledbetter Fair Pay Act of 2009, Pub L. No. 111-2, plaintiff again moved for class certification, focusing on Allstate's uniform compensation policies. The court again denied certification, citing lack of common issues. On appeal, plaintiffs argued disparate impact, claiming that a policy of awarding merit increases based on a percentage of base pay and of comparing salaries to its competitors caused gender-based disparities in earnings. The Seventh Circuit affirmed denial of class certification, stating that plaintiffs did not meaningfully develop the disparate impact claim before the district court, where plaintiffs argued only a pattern-or-practice claim, a type of intentional discrimination.

The brokerage entered into agreements with customers that set a fee for handling, postage, and insurance for mailing confirmation slips after each securities trade. Plaintiff filed claims of breach of contract and unjust enrichment, seeking class certification and recovery of fees charged since 1998. The brokerage removed to federal court under the Class Action Fairness Act, 28 U.S.C. 1332(d), or the Securities Litigation Uniform Standards Act 15 U.S.C. 78p(b) and (c) and 78bb(f), and obtained dismissal. The Seventh Circuit affirmed, first holding that SLUSA did not apply because any alleged misrepresentation was not material to decisions to buy or sell securities, but CAFA's general jurisdictional requirements were met. The agreement did not suggest that the fee represents actual costs, and it was not reasonable to read this into the agreement. Nor did the brokerage have an implied duty under New York law to charge a fee reasonably proportionate to actual costs where it notified customers in advance and they were free to decide whether to continue their accounts.