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

Gorss operated a Super 8 Motel as a franchisee of Wyndham. Gorss agreed to furnish the facility in accordance with Wyndham’s standards and to purchase supplies and equipment from approved vendors. Brigadoon sells fitness equipment and is an approved vendor for Wyndham franchisees. Wyndham periodically provided contact information for its franchisees, including fax numbers, to Brigadoon. Gorss also attended trade shows and personally provided contact information to Wyndham-approved suppliers. Gorss received a fax from Brigadoon advertising its fitness equipment. The fax was sent to more than 10,000 recipients. Brigadoon formulated the list of recipients from a variety of sources.Gorss filed a purported class action under the Telephone Consumer Protection Act, 47 U.S.C. 227(b)(1)(c), seeking statutory penalties. The district court declined to certify a class, finding that common issues did not predominate. The Seventh Circuit affirmed, rejecting Gorss’s argument that the court should have required Brigadoon to show with specific evidence that a significant percentage of the class is subject to the “prior permission” defense. Gorss offered no generalized class-wide manner to resolve the permission question. Brigadoon’s claim of permission was not speculative, vague, or unsupported; it was based on a multitude of contracts, relationships, memberships, and personal contacts. View "Gorss Motels, Inc. v. Brigadoon Fitness Inc." on Justia Law

A putative class of medical providers sued, alleging a conspiracy to drive up the prices of syringes and safety IV catheters (Products). Their first complaint, alleging a hub‐and‐spokes conspiracy ( Sherman Act, 15 U.S.C. 1) between manufacturer, BD, group purchasing organizations, and four distributors, was dismissed because the Providers failed to allege that the distributors coordinated with each other in furtherance of the conspiracy. In an amended complaint, the Providers abandoned their horizontal conspiracy allegations and alleged two vertical conspiracies, one between BD and McKesson and another between BD and Cardinal Health.The district court dismissed, noting that because the named plaintiffs do not purchase the Products directly from Cardinal, they lack “antitrust standing” to sue Cardinal. The Seventh Circuit affirmed. . The Providers cannot sue Cardinal under Article III because their injury is not fairly traceable to Cardinal’s conduct; precedent precludes the suit because they do not purchase the Products from either member of the BD‐Cardinal conspiracy. The Providers did not plausibly establish that vertical conspiracies involving just two distributors and BD could influence the prices that the Providers pay, regardless of which distributor they purchase from, and regardless of the fact that there are at least four major distributors. View "Marion Diagnostic Center, LLC v. Becton Dickinson & Co." on Justia Law

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

Simpson unsuccessfully applied to work as a Correctional Officer at the Cook County Department of Corrections four times in 2014-2017. Simpson believed the hiring practices underlying those rejections violated his rights—and those of other unsuccessful Black applicants—under Title VII of the Civil Rights Act, 42 U.S.C. 2000e-2(a)(1). Invoking disparate treatment and disparate impact theories, Simpson’s class action complaint alleged that, through the use of a five-step hiring process for correctional officers, the Department both intended to discriminate against Black applicants and succeeded in producing that result. The district court denied Simpson’s motion for class certification, finding that none of his proposed classes—a general class of all unsuccessful applicants and five subclasses of candidates dismissed at each step of the hiring process—satisfied Rule 23(a)(2)’s requirement that they present “questions of law or fact common to the class.”The Seventh Circuit vacated. The district court’s analysis apparently merged Simpson’s disparate impact claims with his disparate treatment claims for intentional discrimination. While disparate treatment claims may require a more searching commonality inquiry, disparate impact claims most often will not: the common questions are whether the challenged policy has in fact disparately impacted the plaintiff class and, if so, whether that disparate impact is justified by business necessity. The court did not clearly delineate its reasoning for declining to certify three of Simpson’s disparate impact subclasses. View "Simpson v. Dart" on Justia Law

In 2010, Leszanczuk executed a mortgage contract, securing a loan on her Illinois residence. The mortgage was insured by the FHA. After Carrington acquired the mortgage, Leszanczuk contacted Carrington by phone in December 2016 to make her December payment. Leszanczuk asserts that Carrington told her that her account was not yet set up in their system and that her account was in a “grace period.” In early 2017 Carrington found Leszanczuk to be in default and conducted a visual drive-by inspection of Leszanczuk’s property. Carrington charged Leszanczuk $20.00 for the inspection and disclosed the fee in her March 2017 statement. Leszanczuk claims Carrington knew or should have known that she occupied her property because of the phone conversation and Carrington mailed monthly mortgage statements to the property’s address.Leszanczuk sued Carrington for breach of the mortgage contract and for violations of the Illinois Consumer Fraud and Deceptive Business Practices Act, on behalf of putative nationwide and Illinois classes. She alleged that a HUD regulation limits the fees Carrington may charge under the contract and that the inspection fee was an unfair practice. The Seventh Circuit affirmed the dismissal of the complaint. The mortgage contract expressly permits the disputed fee. Leszanczuk has failed to adequately allege that the inspection fee offended public policy, was oppressive, or caused substantial injury. View "Leszanczuk v. Carrington Mortgage Services, LLC" 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

Santiago, a severely disabled Chicago resident, would leave her van parked on the street near her home for extended periods of time. In 2018, pursuant to the Chicago Municipal Code, her van was towed, impounded, and destroyed. She sued the city on her own behalf and on behalf of others similarly situated, challenging the constitutionality of various aspects of the ordinance. The district court granted, in part, her motion to certify her suit as a class action. With respect to the “Tow Class,” the court concluded that Santiago “is asserting only a facial challenge: the ordinance is unconstitutional because it fails to require adequate notice before a vehicle has been towed.” Concerning the Vehicle Disposal Class, the court rejected Chicago’s assertion that state law requires the class to show prejudice from the city’s failure to strictly follow its ordinance.The Seventh Circuit vacated. The class certification order does not fully demonstrate the “rigorous analysis” required by FRCP 23 and constituted an abuse of discretion. Considering whether questions of law or fact common to class members predominate begins with the elements of the underlying cause of action. The district court did not discuss any of the elements of the underlying causes of action or what the causes of action are. View "Santiago v. City of Chicago" on Justia Law

Railey clocked in and out of work at the Sunset Food Mart by placing her hand on a biometric scanner. She brought a class action in state court in 2019 alleging violations of the Illinois Biometric Information Privacy Act. Two years into litigation, Sunset removed the case to federal court, alleging that Railey’s claims were completely preempted by the Labor Management Relations Act. Sunset explained the timing of the removal by pointing to an interrogatory response it received from Railey in October 2020 in which she confirmed her membership in a labor union.The district court found Sunset’s removal untimely. Citing the Class Action Fairness Act, 28 U.S.C. 1453(c)(1), the Seventh Circuit affirmed the remand to state court. A Class Action Fairness Act exception for “home-state controversies” directs that district courts “shall decline to exercise jurisdiction” over a class action in which “two-thirds or more of the members of all proposed plaintiff classes in the aggregate, and the primary defendants, are citizens of the State in which the action was originally filed,” 28 U.S.C. 1332(d)(4)(B). Railey brought a putative class action on behalf of Illinois citizens against a small Illinois grocery chain under Illinois law. Sunset missed its preemption-based removal window. View "Railey v. Sunset Food Mart, Inc." 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

A class of owners accused Navistar of selling trucks with defective engines. The suit was settled for $135 million. The district court gave its preliminary approval. A court-approved Rule 23(e) notice was sent by first-class mail to all class members describing the settlement terms and the option to litigate independently. The notice's opt-out instructions included a link to a website with the full details and a phone number. The court held a fairness hearing then entered a final judgment implementing the settlement. Class member Drasc had sued Navistar in Ohio concerning the truck engines. The federal court declined to enjoin parallel state court suits, so the Ohio case proceeded while the federal action was pending. After the court approved the settlement, Navistar notified Drasc that its suit is barred by the release in the settlement. Drasc argued that it never received notice of the settlement and that its effort to continue litigating in Ohio should be deemed a “reasonable indication” of a desire to opt-out. The Seventh Circuit affirmed the rejection of Drasc’s arguments, noting findings that two first-class letters were sent to Drasc at its business addresses; Drasc had not provided an email address for notice; Drasc’s Ohio lawyers had actual notice of the settlement and must have known about the need to opt-out. Drasc had actual knowledge of the need to opt-out and could not show excusable neglect that would justify an extension of the opt-out deadline. View "DRASC, Inc. v. Navistar, Inc." on Justia Law