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

The initial six-month agreement between LimeCoral and CareerBuilder specified that all graphic designs created for CareerBuilder would constitute the exclusive property of CareerBuilder and said nothing about renewal fees. After six months, LimeCoral continued to prepare media files incorporating custom graphic designs, typically receiving $3,000 for each new design. As there was no longer a written agreement transferring ownership of the copyright, LimeCoral retained ownership and implicitly granted CareerBuilder a license to use the designs. CareerBuilder argued the license was unconditional and irrevocable; LimeCoral claimed it was subject to CareerBuilder’s alleged agreement to pay an annual renewal fee for every design that CareerBuilder continued to use. LimeCoral sued, alleging breach of copyright and breach of an alleged oral agreement to pay an annual renewal. The district court granted CareerBuilder summary judgment, finding that CareerBuilder had an irrevocable, implied license to use LimeCoral’s designs that was not conditioned upon any agreement to pay LimeCoral renewal fees. The Seventh Circuit affirmed. There was no evidence that would permit the factfinder to conclude that there was an agreement between LimeCoral and CareerBuilder that LimeCoral would be paid a fee for each renewal, and that the implied license LimeCoral granted to CareerBuilder to use the job brandings was subject to that agreement. View "LimeCoral, Ltd. v. CareerBuilder, LLC" on Justia Law

University Park hired Linear as its Village Manager through May 2015, concurrent with the term of its Mayor. In October 2014 the Village extended Linear’s contract for a year. In April 2015 Mayor Covington was reelected. In May, the Board of Trustees decided that Linear would no longer be Village Manager. His contract provides for six months’ severance pay if the Board discharges him for any reason except criminality. The Village argued that the contract’s extension was not lawful and that it owes Linear nothing. The district court agreed and rejected Linear’s suit under 42 U.S.C. 1983, reasoning that 65 ILCS 5/3.1-30-5; 5/8-1-7 prohibit a village manager's contract from lasting beyond the end of a mayor’s term. The Seventh Circuit affirmed on different grounds. State courts should address the Illinois law claims. Linear’s federal claim rests on a mistaken appreciation of the role the Constitution plays in enforcing state-law rights. Linear never had a legitimate claim of entitlement to remain as Village Manager. His contract allowed termination without cause. His entitlement was to receive the contracted-for severance pay. Linear could not have a federal right to a hearing before losing his job; he has at most a right to a hearing to determine his severance pay--a question of Illinois law. View "Linear v. Village of University Park" on Justia Law

In 2012, hackers infiltrated the computer networks at Schnuck Markets, a large Midwestern grocery store chain based in Missouri, and stole the data of about 2.4 million credit and debit cards. By the time the intrusion was detected and the data breach was announced in 2013, the financial losses from unauthorized purchases and cash withdrawals had reached the millions. Financial institutions filed a class action, having issued new cards and reimbursed customers for losses as required by 15 U.S.C. 1643(a). They asserted claims under the common law and Illinois consumer protection statutes (ICFA). The Seventh Circuit affirmed the dismissal of the suit. The financial institutions sought reimbursement for their losses above and beyond the remedies provided under the credit-debit card network contracts; neither Illinois or Missouri would recognize a tort claim in this case, where the claimed conduct and losses are subject to these networks of contracts. Claims of unjust enrichment, implied contract, and third-party beneficiary also failed because of contract law principles. The plaintiffs did not identify a deceptive guarantee about data security, as required for an ICFA claim, nor did they identify how Schnucks’ conduct might have violated the Illinois Personal Information Protection Act. View "Community Bank of Trenton v. Schnuck Markets, Inc." on Justia Law

Linderman bought an Indianapolis house in 2004 and lived there with her ex-husband, their children, and her parents. In 2013, Linderman left and stopped paying the mortgage loan. The others left in 2014. The unoccupied structure was vandalized. U.S. Bank, which owns the note and mortgage, started foreclosure proceedings. The vandalism produced insurance money that was sent to the Bank. The city notified Linderman of code violations. Linderman hired a contractor. In 2015 the Bank disbursed $10,000 for repairs. The contractor abandoned the job. The house was vandalized twice more; a storm damaged the roof. Linderman has not hired a replacement contractor or asked the Bank for additional funds but inquired about the status of the loan and the insurance money. The Bank sent a response. Asserting that she had not received that response, Linderman sued under the Real Estate Settlement Procedures Act, 12 U.S.C. 2605(e)(1)(B). The Seventh Circuit affirmed the rejection of her claims. None of Linderman’s problems with her marriage and mental health can be traced to the Bank. Linderman does not explain how earlier access to the Bank’s record of the account could have helped her; some of her asserted injuries are outside the scope of the Act. The contract between Linderman and the Bank, not federal law, determines how insurance proceeds must be handled. Contract law also governs the arrangement between Linderman and the contractor. View "Floyd v. U.S. Bank National Association" on Justia Law

Linderman bought an Indianapolis house in 2004 and lived there with her ex-husband, their children, and her parents. In 2013, Linderman left and stopped paying the mortgage loan. The others left in 2014. The unoccupied structure was vandalized. U.S. Bank, which owns the note and mortgage, started foreclosure proceedings. The vandalism produced insurance money that was sent to the Bank. The city notified Linderman of code violations. Linderman hired a contractor. In 2015 the Bank disbursed $10,000 for repairs. The contractor abandoned the job. The house was vandalized twice more; a storm damaged the roof. Linderman has not hired a replacement contractor or asked the Bank for additional funds but inquired about the status of the loan and the insurance money. The Bank sent a response. Asserting that she had not received that response, Linderman sued under the Real Estate Settlement Procedures Act, 12 U.S.C. 2605(e)(1)(B). The Seventh Circuit affirmed the rejection of her claims. None of Linderman’s problems with her marriage and mental health can be traced to the Bank. Linderman does not explain how earlier access to the Bank’s record of the account could have helped her; some of her asserted injuries are outside the scope of the Act. The contract between Linderman and the Bank, not federal law, determines how insurance proceeds must be handled. Contract law also governs the arrangement between Linderman and the contractor. View "Floyd v. U.S. Bank National Association" on Justia Law

Baek purchased property through his LLC and obtained financing from Labe Bank; Frank was the loan officer. Frank later moved to NCB and asked Baek to move his business, representing that NCB would provide a larger construction loan at a lower rate. In 2006, Baek entered a construction loan with NCB for $11,750,000. Baek executed a loan agreement, mortgage, promissory note, and commercial guaranty. Baek’s wife did not sign the guaranty at closing. NCB maintains that, 18 months after closing, she signed a guaranty. One loan modification agreement bears her signature but Baek‐Lee contends that it was forged and that she was out of the country on the signing date. NCB repeatedly demanded additional collateral and refused to disburse funds to contractors. The Baeks claim that NCB frustrated Baek’s efforts to comply with its demands. In 2010, NCB filed state suits for foreclosure and on the guaranty. The Baeks filed affirmative defenses and a counterclaim, then filed a breach of contract and fraud suit against NCB. The Baeks later filed a federal Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. 1964(c), suit alleging fraud. The state court granted NCB summary judgment. The federal district court dismissed, citing res judicata. The Seventh Circuit affirmed. There has been a final judgment on the merits with the same parties, in state court, on claims arising from a single group of operative facts. View "Baek v. Clausen" on Justia Law

Plaintiff, a Singaporean shipping company, entered into shipping contracts with an Indian mining company. The Indian company breached those contracts. Plaintiff believes that American businesses that were the largest stockholders in the Indian company engaged in racketeering activity to divest the Indian company of assets to thwart its attempts to recover damages for the breach. Plaintiff filed suit under the Racketeering Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. 1964(c). While the case was pending, the Supreme Court decided RJR Nabisco v. European Community, holding that “[a] private RICO plaintiff … must allege and prove a domestic injury to its business or property.” The district court granted the American defendants judgment on the RICO claims. The Seventh Circuit affirmed. Plaintiff’s claimed injury—harm to its ability to collect on its judgment and other claims—was economic; economic injuries are felt at a corporation’s principal place of business, and Plaintiff’s principal place of business is in Singapore. The court noted that the district court allowed a maritime fraudulent transfer claim to go forward. View "Armada (Singapore) PTE Ltd. v. Amcol International Corp." on Justia Law

At age 56, Newman purchased a long-term-care insurance plan MetLife, opting for one of MetLife’s non-standard options for paying her insurance premiums, “Reduced-Pay-at 65.” From the outset, Newman paid the elevated premium associated with her Reduced-Pay option. When she reached age 65, her premium was cut in half. When Newman was 67 years old, she was startled to discover that MetLife that year more than doubled her insurance premium. The Seventh Circuit reversed the dismissal of Newman’s proposed class action, alleging breach of contract, deceptive and unfair business practices, and common-law fraud. The allegations raised in the complaint were enough to entitle Newman to prevail on the liability phase of her contract claim and to go forward on her remaining claims. The policy language is at least ambiguous, because it can be read reasonably to fix a person’s premium, if she had opted for the Reduced-Pay option. Illinois construes ambiguous contracts against the insurer. Newman’s complaint also alleged facts that plausibly show that MetLife’s policy was both deceptive and unfair under the Illinois Consumer Fraud Act and adequately alleged fraudulent concealment and reasonable reliance. View "Newman v. Metropolitan Life Insurance Co" on Justia Law

In 2012, Dobbs hired McLaughlin to represent him in a products liability suit against DePuy for a 35% contingency fee agreement. The attorney filed Dobbs’s complaint in the DePuy Hip Implant Multidistrict Litigation in the Northern District of Ohio. In 2013, DePuy proposed a settlement, offering parties represented by counsel on a certain date $250,000 and parties not represented $177,500. Dobbs stated that he did not want to settle. McLaughlin advised Dobbs to accept the settlement due to the costs of going to trial. Dobbs moved to remove McLaughlin as his counsel. The motion was granted in January 2015, leaving Dobbs unrepresented. In February 2015, Dobbs decided to accept the settlement offer. Though he was then unrepresented, he was considered a represented party under the settlement terms, entitling him to a base award of $250,000. McLaughlin asserted a lien on Dobbs’s award and sought attorneys’ fees under quantum meruit. The fee dispute was transferred to the Northern District of Illinois, which awarded McLaughlin 35% of Dobbs’s base settlement award, $87,500. Following a remand, the court considered evidence, addressed each quantum meruit factor, and again awarded $87,500. The Seventh Circuit affirmed. The district court considered all of the relevant evidence and engaged in a thoughtful analysis of the factors required by Illinois law, given that it was not the court that presided over the underlying litigation. View "Dobbs v. DePuy Orthopaedics, Inc." on Justia Law

CNH, which manufactures “New Holland” brand farming and construction machinery, hired the real estate services firm, JLL, to manage a corporate re-branding program that involved the replacement of signage more than 1,400 North American dealerships. The vinyl used in the new signs was defective, necessitating the re-manufacture and replacement of virtually all of the installed signs. After the vinyl manufacturer repudiated its commitment to replace, at its own cost, the defective signs, CNH sued, alleging that JLL had failed to perform adequate quality control in the manufacturing of the signs, failed to negotiate the best possible warranty on the vinyl and the signs, and failed to properly document and manage the warranties. The district court found that CNH had suffered damages of $5,482,735 but reduced JLL’s liability to $3,026.361.60—the sum CNH paid to JLL in project management fees—plus such other amounts JLL might recover from third parties (the vinyl manufacturer and the sign fabricators) in the future. The Seventh Circuit affirmed. The district court’s findings were supported by the evidence and make clear that JLL’s own failures with respect to quality control in the manufacturing process and with respect to the vinyl warranty made the defective-sign problem much worse for CNH than it otherwise would have been. View "CNH Industrial America LLC v. Jones Lang LaSalle Americas, Inc." on Justia Law