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

Dancel sued, alleging Groupon had used her photograph to promote a restaurant voucher. Groupon had collected the photograph from Dancel’s public Instagram account based on data linking it to the restaurant’s location. She sought damages under the Illinois Right of Publicity Act (IRPA) on behalf of a class of Illinois residents whose Instagram photographs have appeared on a Groupon offer. The parties litigated in state court until Dancel moved to certify a class of “[a]ll persons who maintained an Instagram Account and whose photograph ... was ... acquired and used on a groupon.com webpage for an Illinois business.” The class was not defined by its members’ residency. Groupon filed a notice of removal under the Class Action Fairness Act, 28 U.S.C. 1453. The district court denied remand and denied class certification. The Seventh Circuit affirmed the denial of class certification. IRPA requires more with respect to the plaintiff’s identity than an Instagram username It demands that an attribute, even a name, serve to identify the individual whose identity is being appropriated. This individualized evidentiary burden prevents identity from being a predominating common question under Rule 23(b)(3). View "Dancel v. Groupon, Inc." on Justia Law

Dancel sued Groupon, an online seller of discount vouchers, alleging Groupon had used her photograph to promote a restaurant voucher. Groupon had collected the photograph from Dancel’s public Instagram account based on data linking it to the restaurant’s location. She sought damages under the Illinois Right of Publicity Act on behalf of a class of Illinois residents whose Instagram photographs have appeared on a Groupon offer. The parties litigated in state court until Dancel moved to certify a class of “[a]ll persons who maintained an Instagram Account and whose photograph ... was ... acquired and used on a groupon.com webpage for an Illinois business.” The class was not defined by its members’ residency. In response, Groupon filed a notice of removal. The Class Action Fairness Act, 28 U.S.C. 1453, permits removal of a proposed class action to federal court if there is minimal diversity, meaning any member of the plaintiff class is a citizen of a state different from any defendant. Groupon, a citizen of Illinois and Delaware, did not identify any class member or his citizenship. Dancel argued that Groupon had waived its right to remove. The district court rejected Dancel’s waiver argument and denied remand but did not address minimal diversity or direct Groupon to cure its allegations. The parties then litigated class certification, which the court denied on predominance grounds. On appeal, Dancel revisited the removal issue. The Seventh Circuit ordered a limited remand for the district court to address limited diversity and secure its jurisdiction. View "Dancel v. Groupon, Inc." on Justia Law

The district court certified a class of about 250 African-American financial advisers who alleged that the Bank treated them less favorably than equivalent advisers of other races. A settlement agreement included a payment of $19.5 million for the benefit of class members who do not opt-out, plus changes in the Bank’s operations and a fund to cover the costs of those changes. The order certifying the class cited Fed. R. Civ. P. 23(b)(2) with respect to the operational changes and Rule 23(b)(3) with respect to the proposed payments. Members are entitled to opt-out of Rule 23(b)(3) classes and pursue their claims individually but they cannot opt-out of Rule 23(b)(2) classes because relief is indivisible. The notice to class members explained this and that anyone who opted out of the (b)(3) relief would still receive the benefit of the (b)(2) changes while retaining a right to sue individually.The 11 opt-outs asked the court to create a subclass for them. The judge declined: 11 is too few to be a subclass and the 11 voluntarily opted out. The judge did not consider the opt-out's objections to the (b)(2) relief; in order to object, a member had to remain in the class for all purposes. The Seventh Circuit dismissed an appeal. The objectors were not aggrieved by the decisions they appealed. Their positions would not change if the district judge had made certain findings, if the allocation of settlement funds were different, or if the language in the notice were different. View "Braxton v. Senegal" on Justia Law

Cash Depot underpaid employees for their overtime work. Fast filed suit under the Fair Labor Standards Act, 29 U.S.C. 203 (FLSA), on behalf of himself and other Depot employees. Depot hired an accountant to investigate. The accountant tallied Depot’s cumulative underpayments at less than $22,000. Depot issued checks to all underpaid current and former employees covered by the suit and issued checks to Fast for his underpaid wages, for liquidated damages under the FLSA, and for Fast’s disclosed attorney fees to that point. Fast and his attorney never cashed their checks. The district court denied a motion to dismiss because Fast contested whether Depot correctly calculated the amount it owed but granted partial summary judgment for Depot, “to the extent that [it] correctly calculated” what it owed Fast. Eventually, Fast conceded that Depot correctly paid the missing wages and urged that only a dispute over additional attorney fees remained. After Fast’s demand for additional attorney fees went unanswered, he filed a motion for attorney fees. The court determined that because Fast was not a prevailing party for the purposes of the FLSA, he was not entitled to attorney fees, and granted Depot summary judgment. The Seventh Circuit affirmed. Fast never received a favorable judgment. View "Fast v. Cash Depot, Ltd." on Justia Law

The plaintiffs, used car dealerships, were solicited by the defendant to enter into a “Demand Promissory Note and Security Agreement.” The defendant would issue a line of credit for the plaintiffs to access in purchasing used vehicles at automobile auctions. The plaintiffs claim defendant did not pay the auction house at the time that possession was delivered put paid only after it received the title to the vehicles purchased, which could take several weeks, but charged interest from the date of the initial purchase. The plaintiffs filed suit and sought class certification to sue on behalf of all other dealers who were subject to the same Agreement. The district court granted Rule 23(b)(3) class certification as to the breach of contract and substantive RICO claims. Weeks later, defendant filed a Motion to Reconsider, arguing that the plaintiffs had asserted in summary judgment briefing that the Agreements are ambiguous and that under such a theory courts must resort to extrinsic evidence on a plaintiff-by-plaintiff basis to determine intent. The court rescinded class certification. The Seventh Circuit vacated. Neither the categorization of the contract as ambiguous nor the prospect of extrinsic evidence necessarily imperils class status. The Agreement at issue is a standard form contract; there was no claim that its language has different meanings for different signatories. View "Red Barn Motors, Inc. v. NextGear Capital, Inc." on Justia Law

Nielen-Thomas, on behalf of herself and others similarly situated, filed a complaint in Wisconsin state court alleging she and other class members were defrauded by their investment advisor. Defendants removed the case to federal court and argued the action should be dismissed because it was a “covered class action” precluded by the Securities Litigation Uniform Standards Act of 1998 (SLUSA), 15 U.S.C. 78bb(f)(1), (f)(5)(B), According to Nielen-Thomas, her lawsuit did not meet SLUSA’s “covered class action” definition because she alleged a proposed class with fewer than 50 members. The district court held that Nielen-Thomas’s suit was a “covered class action” because she brought her claims in a representative capacity, section 78bb(f)(5)(B)(i)(II), and dismissed her claims. The Seventh Circuit affirmed. The plain language of SLUSA’s “covered class action” definition includes any class action brought by a named plaintiff on a representative basis, regardless of the proposed class size, which includes Nielen-Thomas’s class action lawsuit and her complaint meets all other statutory requirements, her lawsuit is precluded by SLUSA. View "Nielen-Thomas v. Concorde Investment Services, LLC" on Justia Law

The Illinois Department of Human Services pays personal home health care assistants to care for elderly and disabled persons. The assistants are public employees under the Illinois Public Labor Relations Act, which authorizes collective bargaining. The Union is their exclusive representative, required to represent all public employees, including non-members. Under the collective bargaining agreement, the Union collected limited "fair share" fees from workers who chose not to join, which were automatically deducted from the assistants' pay. Workers who objected to this arrangement sued under 42 U.S.C. 1983. The Seventh Circuit affirmed the dismissal of their claim; the Supreme Court reversed. On remand, the Objectors sought certification of a class, arguing that their proposed class of around 80,000 members was entitled to a refund of approximately $32 million. The Seventh Circuit affirmed a holding that class certification was inappropriate, stating that: the class definition was overly broad in light of evidence that a substantial number of class members did not object to the fee and could not have suffered an injury; named plaintiffs were not adequate representatives; individual questions regarding damages predominated over common ones; the class faced manageability issues; and a class action was not a superior method of resolving the issue. Following a second remand, the Seventh Circuit affirmed, holding that the Supreme Court’s 2018 “Janus” decision does not require a different result on whether the class-action device is proper for use in seeking refunds of fair-share fees. View "Riffey v. Rauner" on Justia Law

The lead plaintiffs in consolidated purported class actions received faxed advertisements that allegedly did not comply with the Telephone Consumer Protection Act (TCPA), 47 U.S.C. 227 and the Federal Communication Commission’s Solicited Fax Rule. Each district court refused to certify the proposed class, largely on the authority of the D.C. Circuit’s 2017 decision in Bais Yaakov of Spring Valley v. FCC, regarding the validity of the FCC’s 2006 Solicited Fax Rule. The Seventh Circuit affirmed. At a minimum, it is necessary to distinguish between faxes sent with permission of the recipient and those that are truly unsolicited. The question of what suffices for consent is central, and it is likely to vary from recipient to recipient. The district courts were within their rights to conclude that there are enough other problems with class treatment here that a class action is not a superior mechanism for adjudicating these cases. View "Alpha Tech Pet, Inc. v. Lagasse, LLC" on Justia Law

When Beaton’s laptop malfunctioned, he discovered SpeedyPC, which offered a diagnosis and a cure. Beaton took advantage of Speedy’s free trial, which warned that his device was in bad shape and encouraged him to purchase its software, The software failed to improve his laptop’s performance. Beaton filed a consumer class action, raising contract and tort theories. The district court certified a nationwide class and an Illinois subclass of software purchasers. The Seventh Circuit affirmed, rejecting Speedy’s argument that the class definitions and legal theories covered by the certification orders impermissibly differ from those outlined in the complaint by the narrowing of the class from everyone in the U.S. who had purchased SpeedyPC Pro, to individual persons (not entities) who downloaded the free trial and purchased the licensed software over a three‐year period. Speedy did not suffer “unfair surprise,” given that the “legal basis for liability is based on the same allegations” about the sale of worthless software. By not raising the argument before the district court, Speedy forfeited its assertion that Beaton is judicially estopped from seeking relief under the law of British Columbia, having initially argued for Illinois law. Class certification satisfied Rule 23(a); common questions of fact and law predominate and the amount of damages to which each plaintiff would be entitled is so small that no one would otherwise bring suit. Consumer class actions are a crucial deterrent against the proliferation of bogus products. View "Beaton v. SpeedyPC Software" on Justia Law

In 2008, Standard sued, on behalf of itself and “all others similarly situated," alleging that was injured when it “purchased several items of steel tubing [at an inflated price] indirectly … for end use," claiming that eight U.S. steel producers colluded to slash output to drive up the price of steel so that plaintiffs overpaid for steel sheets, rods, and tubing. Eight years later, the plaintiffs amended their complaint, asserting that they overpaid for end-use consumer goods, including vehicles, washing machines, and refrigerators, that were manufactured by third parties using steel. The district court dismissed the suit as time-barred because it redefines “steel products” to give rise to an entirely different, and exponentially larger, universe of plaintiffs, and, in the alternative, for not plausibly pleading a causal connection between the alleged antitrust conspiracy and plaintiffs’ own injuries. The Seventh Circuit affirmed. No reasonable defendant, reading the original complaint, would have imagined that plaintiffs were actually suing over the thousands of end-use household and commercial goods manufactured by third parties—a reading so broad that it would make nearly every person in the country a potential class member. The court further noted that it was unclear how to trace the effect of an alleged overcharge on steel through the complex supply and production chains that gave rise to consumer products. View "Supreme Auto Transport, LLC v. Arcelor Mittal USA, Inc." on Justia Law