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

Matthew Metzler, an undergraduate student at Loyola University Chicago, was expelled in January 2017 after a university hearing board found him responsible for sexual misconduct involving another student, referred to as Jane Roe. The university’s Title IX process began after Roe reported feeling pressured into sexual acts without her consent. Initially, Roe declined to file a formal complaint, but later decided to do so after continuing distress. The university investigated, interviewed both parties, and considered evidence, including text messages and witness names provided by Metzler. The hearing board credited Roe’s account over Metzler’s based on the perceived consistency and credibility of her statements and found him responsible, resulting in expulsion. Metzler’s appeal was unsuccessful.Metzler filed suit in the United States District Court for the Northern District of Illinois, Eastern Division, asserting claims under Title IX for unlawful sex discrimination and breach of contract due to alleged procedural irregularities in the disciplinary process. The district court granted summary judgment for Loyola, finding insufficient evidence that Metzler had been discriminated against based on sex or that contractual standards had been violated in a manner lacking rational basis. The case was briefly remanded for jurisdictional review and to determine anonymity, after which the district court reaffirmed its decision for Loyola.The United States Court of Appeals for the Seventh Circuit reviewed the case de novo. It held that Metzler failed to present sufficient evidence for a reasonable factfinder to conclude that Loyola discriminated against him on the basis of sex under Title IX, even when considering generalized public pressure and procedural errors. The court further found that Metzler’s breach of contract claim failed because Loyola had a rational basis for its disciplinary decision. The judgment of the district court was affirmed. View "Metzler v Loyola University Chicago" on Justia Law

37celsius Capital Partners, a Milwaukee-based firm specializing in healthcare-related businesses, sought to acquire Care Innovations, a subsidiary of Intel Corporation. The parties entered into a nondisclosure agreement containing a “Hold Harmless” clause that limited damages, and subsequently executed a term sheet outlining the proposed transaction. The term sheet required 37celsius to contribute $12 million by a specified closing date and granted it an exclusivity period during which Intel could not negotiate with other parties regarding Care Innovations. The term sheet expressly limited legal obligations, stating that no binding contract would exist until a definitive agreement was executed, except for certain provisions such as confidentiality and exclusivity.After 37celsius failed to provide proof of the required funds by the closing date, Intel sold Care Innovations to another buyer. 37celsius filed suit in Wisconsin state court, alleging breach of contract based on Intel’s communications with third parties during the exclusivity period. The defendants removed the case to the United States District Court for the Eastern District of Wisconsin, which ruled that 37celsius was not entitled to expectation damages under the NDA and subsequently granted summary judgment for Intel, finding no reliance damages and no evidence of causation.The United States Court of Appeals for the Seventh Circuit reviewed the district court’s summary judgment de novo. It held that the term sheet was not a binding “Type II” preliminary agreement under Delaware law, as its language did not obligate the parties to negotiate in good faith. Further, even if a binding obligation existed, 37celsius could not show that Intel’s alleged breach was the but-for cause of the failed transaction, as 37celsius did not have the required funds. The court also concluded that the NDA barred expectation damages and 37celsius did not appeal the denial of reliance damages. The Seventh Circuit affirmed the district court’s judgment for Intel. View "37celsius Capital Partners, L.P. v Intel Corporation" on Justia Law

Four property-specific limited liability companies owned real estate in Wisconsin, which was leased to skilled nursing facilities operated by Kevin Breslin through his company, KBWB Operations, LLC. Breslin and his co-guarantors executed personal guaranties ensuring payment and performance under the leases. The nursing facility tenants defaulted on their rent obligations starting in 2018 and subsequently lost their operating licenses after a court-appointed receiver moved residents out. The tenants also failed to complete a purchase option for the properties, triggering a liquidated damages clause. Plaintiffs later sold the properties at a loss.The plaintiffs sued Breslin, his company, and co-guarantors in the United States District Court for the Northern District of Illinois to enforce the guaranties and recover damages. During the litigation, plaintiffs discovered that one co-guarantor was a California citizen, which destroyed complete diversity and thus federal jurisdiction. Plaintiffs moved to dismiss this non-diverse defendant, arguing he was not indispensable because the guaranties provided for joint and several liability. The district court agreed and dismissed him. Breslin did not oppose the dismissal. Plaintiffs then moved for summary judgment; Breslin, facing criminal charges, invoked the Fifth Amendment and presented no evidence on liability or damages. The district court granted summary judgment to plaintiffs and awarded nearly $22 million in damages across several categories.On appeal, the United States Court of Appeals for the Seventh Circuit held that jurisdiction was proper because the dismissed co-guarantor was not an indispensable party under Rule 19, given joint and several liability. The court affirmed the district court’s findings on most damages but vacated the awards for accelerated rent under one lease (pending further consideration of its enforceability as a liquidated damages clause) and for liquidated damages related to the purchase option (finding it unenforceable as a penalty). The case was remanded for recalculation of damages consistent with these holdings. In all other respects, the judgment was affirmed. View "CCP Golden/7470 LLC v. Breslin" on Justia Law

After the dissolution of their marriage, Jane and Kenton Girard became involved in prolonged legal proceedings regarding custody of their two minor children. Following Kenton's remarriage to Marissa Girard, the Illinois state court added Marissa as a party to the postjudgment custody dispute in 2023. The situation grew more complicated when Kenton filed a cross-claim against Marissa over a postnuptial agreement, which he argued did not obligate him to indemnify her for legal expenses or lost earnings related to the custody litigation. Marissa responded by removing the entire case to federal court, asserting the existence of a federal question.The United States District Court for the Northern District of Illinois reviewed the removal and determined that the case did not present a federal question. The court found that the dispute revolved around state-law issues of contract and domestic relations, and therefore remanded the case to state court for lack of subject-matter jurisdiction. Marissa appealed this remand order to the United States Court of Appeals for the Seventh Circuit. However, the Seventh Circuit dismissed her appeal, noting that remand orders are generally not appealable unless the case was removed under specific statutory provisions, which did not apply here.The United States Court of Appeals for the Seventh Circuit then addressed a motion for sanctions under Rule 38 of the Federal Rules of Appellate Procedure, filed by Jane Girard. The court held that Marissa’s appeal was frivolous, both because removal to federal court was unwarranted and because the remand order was not appealable. The court awarded Jane damages in the amount of $2,808.75 for fees and costs incurred in defending the appeal. View "Girard v. Girard" on Justia Law

Delta Airlines contracted with Lands’ End to supply new uniforms for its employees, which were manufactured overseas and distributed to approximately 64,000 workers. After the uniforms were issued, many employees reported that the garments transferred dye onto other surfaces and caused a range of health symptoms, including skin irritation and respiratory issues. Two groups of Delta employees filed lawsuits: one group sought damages for property damage and breach of express warranty as intended beneficiaries of the contract between Delta and Lands’ End, while the other group pursued personal injury claims, alleging the uniforms were defectively manufactured or designed and that Lands’ End failed to warn of these defects.The United States District Court for the Western District of Wisconsin consolidated the actions and, after discovery, granted summary judgment in favor of Lands’ End on all claims. For the personal injury claims, the court excluded the plaintiffs’ expert testimony on defect and causation, finding the opinions unreliable under Federal Rule of Evidence 702 and Daubert v. Merrell Dow Pharmaceuticals, Inc. The court also found that the plaintiffs failed to present sufficient evidence that the uniforms were defective or that any defect caused their injuries. On the breach of warranty claim, the court determined that Lands’ End had not breached the contract’s satisfaction guarantee because plaintiffs had not returned their uniforms as required by the contract’s terms.On appeal, the United States Court of Appeals for the Seventh Circuit affirmed the district court’s judgment. The Seventh Circuit held that the exclusion of the plaintiffs’ expert testimony was not an abuse of discretion, as the experts failed to reliably establish defect or causation. The court also held that summary judgment on the breach of warranty claim was proper because the contract’s return requirement was reasonable and not an unlawful limitation on the express warranty. The district court’s judgment was affirmed in full. View "Gilbert v Lands' End, Inc." on Justia Law

In 2016, the Village of Schaumburg enacted an ordinance requiring commercial and multifamily properties to route fire alarm signals directly to a regional emergency-dispatch center. This ordinance aimed to reduce fire department response times and had financial benefits for the Village. Several alarm companies, which previously used a different model for transmitting alarm signals, claimed that the ordinance caused them to lose business and led to more expensive and lower-quality alarm services for customers.The alarm companies sued the Village, alleging that the ordinance violated the Contracts Clause and tortiously interfered with their contracts and prospective economic advantage. The United States District Court for the Northern District of Illinois initially dismissed the federal claims and relinquished jurisdiction over the state-law claims. On appeal, the Seventh Circuit reversed in part, allowing the Contracts Clause claim to proceed. However, on remand, the district court granted summary judgment for the Village, finding that the alarm companies failed to provide evidence that the ordinance caused customers to breach existing contracts or that the Village intended to interfere with their business relationships.The United States Court of Appeals for the Seventh Circuit reviewed the case and affirmed the district court's decision. The court held that the alarm companies did not present sufficient evidence to show that the ordinance caused customers to breach contracts or that the Village acted with the intent to harm the alarm companies' businesses. The court also found that the alarm companies' claims of tortious interference with prospective economic advantage failed because the Village's actions were motivated by public safety and financial considerations, not a desire to harm the alarm companies. View "Alarm Detection Systems, Inc. v. Village of Schaumburg" on Justia Law

Avanzalia Panamá and its parent company, Avanzalia Solar, built a solar plant in Panama and sought to connect it to the El Coco substation, owned by Goldwind USA's affiliate, UEPI. Avanzalia alleged that Goldwind tortiously blocked their access to the substation, preventing them from selling electricity. Avanzalia filed a complaint with Panama's Autoridad de Servicios Públicos (ASEP), which required them to submit updated electrical studies and obtain an access agreement with UEPI. Despite obtaining the agreement, Avanzalia faced further delays and was unable to connect to the substation until May 2020.The United States District Court for the Northern District of Illinois granted summary judgment to Goldwind. The court found that Avanzalia could not satisfy the Illinois state law requirement for tortious interference, which necessitates that the defendant's actions be directed at a third party. The court also applied collateral estoppel, concluding that ASEP's findings were binding and precluded Avanzalia's claims related to pre-access agreement delays.The United States Court of Appeals for the Seventh Circuit reviewed the case. The court affirmed the district court's decision to afford comity to ASEP's order and apply collateral estoppel, barring Avanzalia's claims related to pre-access agreement delays. However, the appellate court found that the district court erred in not considering the impossibility theory of tortious interference under Restatement (Second) of Torts § 766A. The court vacated the summary judgment on this issue and remanded for further proceedings to determine whether Goldwind wrongfully prevented Avanzalia from performing its contractual obligations. The judgment was affirmed in all other respects. View "Avanzalia Solar, S.L. v. Goldwind USA, Inc." on Justia Law

Clinton Mahoney, the sole member and manager of Mahoney & Associates, LLC, signed an agreement obligating the company to contribute to the Railroad Maintenance and Industrial Health and Welfare Fund, an employee benefit fund. When the Fund could not collect delinquent contributions from Mahoney & Associates, it sued Mahoney personally, citing a personal liability clause in the agreement. The district court granted summary judgment to the Fund, concluding that Mahoney was personally liable based on the clause.The United States District Court for the Central District of Illinois initially entered judgment on July 31, but it did not comply with Federal Rule of Civil Procedure 58. Mahoney filed a notice of appeal on September 26, and the district court later entered a corrected judgment on October 11. Mahoney filed a second notice of appeal the same day. The district court had awarded the Fund attorneys’ fees based on the trust agreement.The United States Court of Appeals for the Seventh Circuit reviewed the case de novo. The court found that there was a genuine dispute of material fact regarding Mahoney’s intent to be personally bound by the trust agreement, as he signed the memorandum in a representative capacity, which conflicted with the personal liability clause. The court concluded that this issue could not be resolved at summary judgment. The court also addressed Mahoney’s laches defense but found it waived due to his failure to address relevant complications. Consequently, the Seventh Circuit reversed the district court’s grant of summary judgment and vacated the award of attorneys’ fees, remanding the case for further proceedings. View "Railroad Maintenance and Industrial Health & Welfare Fund v. Mahoney" on Justia Law

In 1997, William Brokaw Price’s parents entered into a contract with Carri Scharf Trucking, Inc. (CST) for surface-level mining on their property. The contract allowed CST to extract sand, gravel, and topsoil in exchange for royalty payments. As the contract neared its end in 2010, Bill Price, Brokaw’s father, communicated with CST about future plans for the property but passed away shortly after. Years later, Brokaw discovered that the property had not been reclaimed as required by the contract, leading to a dispute over CST’s reclamation obligations and alleged trespassing.The Prices sued CST for breach of contract, and CST counterclaimed for breach based on the Prices’ trespass accusations. The first trial ended in a mistrial, and the second trial resulted in a verdict for CST. The district court denied the Prices’ motion for judgment as a matter of law and rejected CST’s request for attorney’s fees under the contract’s fee-shifting provision.The United States Court of Appeals for the Seventh Circuit reviewed the case. The court affirmed the district court’s decision, holding that the contract did not set a firm deadline for reclamation and allowed for a jury to resolve factual disputes about the instructions given by Bill Price. The jury had a sufficient basis for its verdict in favor of CST. Additionally, the court held that CST was not entitled to attorney’s fees because the contract’s fee-shifting provision only applied to parties enforcing the contract’s terms, and CST’s successful defense did not trigger that provision. The court affirmed the judgment of the district court in all respects. View "Price v Carri Scharf Trucking, Inc." on Justia Law

Epic Systems Corporation sued Tata Consultancy Services Limited and Tata America International Corporation for unauthorized use of confidential information. A jury awarded Epic $240 million in compensatory damages and $700 million in punitive damages. The district court reduced these amounts to $140 million and $280 million, respectively, and entered judgment in 2017. The Seventh Circuit affirmed the compensatory damages but limited the punitive damages to $140 million, leading to a new judgment in 2022. Tata agreed to pay postjudgment interest on the compensatory damages from 2017 but argued that interest on the punitive damages should start from 2022. The district court sided with Tata, and Epic appealed.The United States Court of Appeals for the Seventh Circuit reviewed the case. The court noted that both the 2017 and 2022 judgments included $140 million in compensatory damages and at least $140 million in punitive damages. The court referenced the Supreme Court's decision in Kaiser Aluminum & Chemical Corp. v. Bonjorno, which held that postjudgment interest should be based on the date when damages became ascertainable. The Seventh Circuit concluded that the $140 million punitive damages were ascertainable from the 2017 judgment, as neither the district court nor the appellate court had ever deemed this amount excessive.The Seventh Circuit reversed the district court's decision and remanded the case with instructions to award postjudgment interest on the $140 million punitive damages starting from October 3, 2017. View "Epic Systems Corporation v Tata Consultancy Services Limited" on Justia Law