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

In 2017, Ramos settled his lawsuits against Cook County Jail correctional officers under 42 U.S.C. 1983 that alleged a failure to protect Ramos from another inmate and the use of excessive force. The settlement agreements contained an identical 262-word sentence—labeled a general release—that released Cook County and its employees from all claims. Months later, Ramos filed another section 1983 lawsuit against two Cook County police officers based on a 2016 arrest that occurred after the events that lead to the first two lawsuits but prior to the execution of the settlement agreements.The Seventh Circuit affirmed the district court’s grant of summary judgment to the defendants. “While the rambling, 262- word sentence is no model of clarity,” it unambiguously released Ramos’s claims arising out of the 2016 arrest. Three phrases signal that Ramos released all foreseeable claims against Cook County “and its agents, employees and former employees,” including those stemming from his 2016 arrest when he signed the settlement agreements in 2017. View "Ramos v. Piech" on Justia Law

In 2006, Price approached Marcone about using e-commerce in the appliance parts industry. Price and Marcone entered into a non-disclosure agreement while evaluating the concept, but no partnership resulted. Price then created PartScription. Both companies sell appliance replacement parts online. In 2017, Price restarted talks with Marcone. In 2018, Marcone’s CEO proposed that PartScription and Marcone form a “50-50” partnership. Price accepted, and they shook hands on the idea. Price drafted a term sheet for the contemplated partnership. The first line sheet states “PartScription and Marcone (PSM) have agreed to form a partnership/joint venture to serve the independent hardware industry.” Negotiations continued. During a conference call, Marcone representatives purportedly “stated that they approved of the terms,” and offered one change regarding a joint bank account. Days later Price sent a follow-up email saying that his notes indicated “Marcone ha[d] approved the terms outlined in the draft PSM term sheet” and asking whether they needed to memorialize the agreement. No further memorialization took place. Marcone's representatives became unresponsive.In 2021, PartScription filed suit. The Seventh Circuit affirmed the dismissal of the suit. PartScription’s complaint fails to plausibly allege a valid contract; any amendment would be futile. The only documentation speaks of general goals— not obligations—and fails to identify definite and certain binding terms. View "KAP Holdings, LLC v. Mar-Cone Appliance Parts Co." on Justia Law

Page sued Alliant Credit Union under the Electronic Fund Transfers Act, 15 U.S.C. 1693–1693r, and state law on behalf of herself and other similarly situated customers, alleging that Alliant charged fees in violation of its contract. Alliant charges a nonsufficient fund (NSF) fee when it rejects an attempted debit because an account lacks sufficient funds to cover the transaction. Page argued that the contract requires Alliant to assess NSF fees using the “ledger-balance method” and only allowed one NSF fee per transaction, while Alliant claimed that the contract permits it to use the “available-balance method.”The district court dismissed Page’s claim. The Seventh Circuit affirmed. Analyzing the contract under Illinois principles of construction, it is not ambiguous and it does not prohibit Alliant from using the available-balance method to charge NSF fees. Alliant does not promise not to charge multiple fees when a transaction is presented to it multiple times. View "Page v. Alliant Credit Union" on Justia Law

Riegel, seeking to build a condominium development in Isla Mujeres, formed ISLA and borrowed millions of dollars from the Hovdes. The project failed. More than 10 years later, the Hovdes sued ISLA and Riegel.The district court granted the defendants summary judgment on the claim based on the Mortgage Note, citing the 10-year limitations period, and later holding that the limitations defense could be asserted against Riegel as the guarantor. The Seventh Circuit affirmed. An acceleration clause provided that if a Default occurred, the outstanding unpaid principal and interest would automatically become immediately due, triggering the 10-year limitations period. One such “Default” was an “Act of Bankruptcy,” defined to include admitting in writing the inability to pay debts as they mature. Two emails sent by Riegel to the Hovdes constituted an admission in writing of inability to pay debts: an August 7, 2008 email, asking for an advance to pay a tax bill, and a subsequent email indicating that all construction workers had been suspended. The language does not require actual insolvency; it merely requires an admission of an inability to pay the debts, whether or not true. The terms “continuing, absolute, and unconditional” are terms of art when used in guarantees and do not waive the limitations defense. View "Hovde v. ISLA Development LLC" on Justia Law

In 2012, a competitor sued Creation for trademark violations. Creation requested that Selective Insurance provide coverage. Selective refused. Creation’s settlement with its competitor prevented Creation from selling one of its primary lines. Creation struggled financially. Selective sought a declaration in Illinois state court that it had no duty to defend. Creation countersued and also alleged breach of the insurance policy. The Illinois court entered partial summary judgment for Creation on its duty-to-defend claim, limited to fees Creation incurred before the original trademark litigation was settled.In 2014—in the middle of the state-court litigation—Creation sued Selective in federal court for breach of contract and under the Illinois Insurance Code. In 2016, Creation voluntarily dismissed its state-court breach-of-contract claim with leave to refile. The Illinois court expressly reserved Creation’s right to maintain its federal action on its contract claim. After the 2017 state court award, the federal district court awarded Creation nearly $3 million in damages on the Insurance Code claim. After remand, Creation unsuccessfully sought to amend its complaint to seek punitive damages. The district court then concluded that the doctrines of claim and issue preclusion barred Creation’s remaining contract claim.The Seventh Circuit reversed, noting that the case is an “anomaly.” The state court expressly reserved Creation’s right to file the claim in federal court, so the suit is not precluded by its earlier state-court litigation. View "Creation Supply, Inc. v. Selective Insurance Co. of the Southeast" on Justia Law

Rock Hemp contracted with CBDINC to purchase 6,000 hemp seeds. CBDINC is a fictitious business name used by Dunn, Davies, and Kolodny (Appellees). The contract contains an arbitration clause requiring “[a]ny dispute arising out of this Agreement” be resolved through “binding arbitration” in Denver, Colorado. Disappointed with CBDINC’s hemp seeds, Rock sued the Appellees individually, not CBDINC, in Wisconsin state court. The Appellees removed the case to federal court and moved to dismiss the case for failure to comply with the arbitration clause. Rock sought remand under 28 U.S.C. 1447.The Seventh Circuit affirmed the judgment in favor of the Appellees. Based on the date when Rock “specifically disclose[d] the amount of monetary damages sought,” the district court correctly found that removal was timely. The Appellees did not fully litigate the merits of the case in state court. The allegations in the complaint make clear that CBDINC was not a distinct legal entity from the Appellees, and Rock does not allege it was confused or deceived by the use of the d/b/a; the district court correctly concluded that the contract is valid and Appellees have standing to enforce it. View "Rock Hemp Corp. v. Dunn" on Justia Law

Greenbank purchased “Thomas” for $500,000, for use as a competitive showhorse. Greenbank obtained insurance from GA that included coverage for Thomas’s “death” or “authorized humane destruction.” In February 2018, Thomas became sick. Over the next few months, Thomas lost 50 pounds and developed cellulitis in all four legs and uveitis in his eye. In April 2018, Greenbank reported Thomas’s pneumonia to GA. Greenbank's veterinarian informed GA that Thomas “probably” needed to be euthanized. GA retained its own veterinarians. Thomas was transported to its facility, where Dr. MacGillivray advised that it would not be unreasonable to make a euthanasia recommendation but she wanted to try treatment. Greenbank objected, arguing that treatment would destroy Thomas’s future athleticism. After his surgery, Thomas made a "remarkable" recovery. Thomas is still doing well.GA denied coverage for certain treatments and rejected Greenbank’s renewal payment of $14,725.000, citing her failure to provide immediate notice of Thomas’s illness in February 2018. Greenbank argued that GA acted in bad faith by unreasonably withholding consent for authorized humane destruction and that GA’s continued care and control over Thomas after the policy terminated constituted conversion and theft.The Seventh Circuit affirmed the dismissal of her claims. Thomas saw three veterinarians in five months; no veterinarian certified that Thomas needed to be euthanized. Nothing in the contract requires GA to protect Thomas’s use as a show horse. Greenbank never made an unqualified demand for Thomas’s return nor did she establish that any demand would have been futile. View "Greenbank v. Great American Assurance Co." on Justia Law

Corwell’s insurance broker told him that Coventry would essentially provide free life insurance for a couple of years before an assignment of the policy to those who had funded it from the beginning, at no expense or risk to the insured. In 2006, Corwell, age 78, applied to Sun Life for a $5 million life insurance policy, indicating that his family L.P. would be the primary beneficiary and Corwell would be the owner. The annual premium, $300,000 per year, exceeded Corwell’s income almost every year. Corwell falsely stated that the premiums would not involve premium financing. Sun would not have issued the policy if it had known that Corwell would be using a non-recourse loan to pay the premiums. At the end of the loan’s 30-month term, Coventry notified Corwell that the balance was $569,572; Corwell could either repay it or relinquish the policy. As expected, Corwell relinquished the policy, which the lender sold to Coventry. Sun Life rejected a 2017 death claim and sought a declaratory judgment that the policy was void as an illegal wagering contract, procured for the benefit of strangers who lacked an insurable interest, in violation of Illinois law. The district court granted Sun summary judgment and allowed it to keep almost all of the premiums.The Seventh Circuit affirmed with the exception of part of the premiums. Illinois law looks beyond the form of the transactions and considers the substance to determine whether a purchase was supported by an insurable interest. This funding arrangement was an unlawful wager by strangers on Corwell’s life. View "Sun Life Assurance Company of v. Wells Fargo Bank, N.A." on Justia Law

Taizhou, a Chinese manufacturer, entered into a Cooperation Agreement with Z Outdoor, a Wisconsin company owned by Casual Products: Taizhou would manufacture outdoor furniture and other related items for Z Outdoor to sell to customers. Z Outdoor eventually stopped paying Taizhou. The Cornings, on behalf of Z Outdoor, made false statements about future business, forthcoming payments, and causes for the delays. Taizhou continued to fill customer orders without receiving compensation. In 2018, AFG (a Wisconsin LLC also owned by Casual) started submitting purchase orders to Taizhou. AFG never signed the Cooperation Agreement. Taizhou filled the orders and sent AFG invoices. AFG eventually stopped paying Taizhou and made false statements regarding payment delays. The total due from Z Outdoor and AFG accrued to $14 million for purchase orders sent, 2017-2019.The district court entered a default judgment against the corporate defendants on Taizhou's contract claims but ruled against Taizhou on unjust enrichment, fraud, and conversion claims, finding the fraud and conversion claims barred by Wisconsin’s economic loss doctrine and q “mere repackaging of Taizhou’s ‘straightforward breach of contract claim.’” The Seventh Circuit affirmed. Any fraud was interwoven with the Cooperation Agreement, so the economic loss doctrine applies. To the extent the damages amounted to lost profits or lost business, those are also economic losses under Wisconsin law. View "Taizhou Yuanda Investment Group Co., Ltd. v. Z Outdoor Living, LLC" on Justia Law

In 2001, Levy, a 37-year-old single mother of two, purchased a 20-year term life insurance policy from West Coast, with a $3 million benefit payable upon her death to her sons. In January 2019, Benita—in deteriorating physical and mental health—missed a payment. Approximately five months later, she died, having never paid the missed premium. West Coast declared the policy forfeited.Levy's sons filed suit, alleging breach of contract and that a late-2018 missed-payment notice failed to comply with the Illinois Insurance Code, which forbids an insurer from canceling a policy within six months of a policyholder’s failure to pay a premium by its due date (calculated to include a 31-day grace period) unless the insurer provided notice stating “that unless such premium or other sums due shall be paid to the company or its agents the policy and all payments thereon will become forfeited and void, except as to the right to a surrender value or paid-up policy as provided for by the policy.” West Coast’s 2018 notice incorporated much of the statutory language. The Seventh Circuit affirmed the dismissal of the complaint. The Notice adequately alerted policyholders to the consequences of nonpayment; there was no need for the Notice to mention the company’s agents as alternate payees. View "Levy v. West Coast Life Insurance Co." on Justia Law