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

Plaintiffs, 39 former employees of Infinium Capital, voluntarily converted loans they had made to their employer under the company’s Employee Capital Pool program into equity in the company. A year later their redemption rights were suspended; six months after that, they were told their investments were worthless. Plaintiffs filed suit against Infinium, the holding company that owned Infinium, and members of senior management, asserting claims for federal securities fraud and state law claims for breach of fiduciary duty and fraud. The Seventh Circuit affirmed the dismissal, with prejudice, of their fifth amended complaint for failure to state a claim. Reliance is an element of fraud and each plaintiff entered into a written agreement that contained ample cautionary language about the risks associated with the investment. Federal Rule of Civil Procedure 9(b) provides that a party alleging fraud or mistake “must state with particularity the circumstances constituting fraud or mistake,” although “[m]alice, intent, knowledge, and other conditions of a person’s mind may be alleged generally.” Plaintiffs failed to identify the speakers of alleged misrepresentations with adequate particularity, failed to adequately plead scienter, and failed to plead a duty to speak. View "Cornielsen v. Infinium Capital Management, LLC" on Justia Law

Pro-life “sidewalk counselors” sued to enjoin Chicago’s “bubble zone” ordinance, which bars them from approaching within eight feet of a person within 50 feet of an abortion clinic if their purpose is to engage in counseling, education, leafletting, handbilling, or protest. They argued that the floating bubble zone was a facially unconstitutional content-based restriction on the freedom of speech. The district judge dismissed the claim, relying on the Supreme Court’s 2000 decision (Hill), which upheld a nearly identical Colorado law against a similar First Amendment challenge. The Seventh Circuit affirmed. Abortion clinic buffer-zone laws “impose serious burdens” on core speech rights but under Hill, a floating bubble zone is not considered a content-based restriction on speech and is not subject to strict judicial scrutiny. The ordinance is classified as a content-neutral “time, place, or manner” restriction and is tested under the intermediate standard of scrutiny;Hill held that the governmental interests at stake—preserving clinic access and protecting patients from unwanted speech—are significant, and an 8-foot no-approach zone around clinic entrances is a narrowly tailored means to address those interests. The court noted that Hill’s content-neutrality holding is hard to reconcile with subsequent Supreme Court decisions, but those decisions did not overrule Hill, so it remains binding. View "Price v. Chicago" on Justia Law

A confidential informant bought cocaine from Yarber on four separate occasions near the same Champaign intersection while police watched. Each time, Yarber drove a white Dodge Charger, which was registered to his girlfriend. Immediately following two buys, Yarber drove to his girlfriend’s apartment. Police surveilled the apartment three other times and saw the Charger parked in front. Once they saw Yarber exit the Charger and go inside the apartment. Police obtained a warrant, authorizing the police to search the apartment for drugs, drug paraphernalia, and suspected proceeds from drug transactions. Nowhere did the affidavit state that Yarber lived at the apartment or that he stayed there overnight. It referred to an Urbana apartment as Yarber’s “residence.” Yarber moved to suppress evidence discovered during the search of the Champaign apartment, arguing that, failing to establish a nexus between the drug dealing and the apartment, the affidavit failed to establish probable cause. After the court denied his motion, Yarber pleaded guilty to drug possession with the intent to distribute and to possession of a firearm by a felon; he was convicted of possession of a firearm in furtherance of drug trafficking, and sentenced to 420 months’ imprisonment. The Seventh Circuit affirmed. The warrant contained other facts sufficient to establish probable cause and, in any event, the police acted in good faith. View "United States v. Yarber" 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

From 2002-2008 Boliaux operated EMC, a used-car dealership. He borrowed money. Most loans were secured by the cars’ certificates of title. Because there should be only one title certificate per car, the dealer cannot transfer good title to a customer without paying the lender. In 2007 Boliaux persuaded state officials to issue duplicate certificates of title on the pretense that the originals had been lost. He obtained multiple loans against single vehicles, exceeding the cars’ market value and leaving the lenders under-secured. He sold cars without repaying the loans. After a lender detected this and impounded the collateral, Boliaux persuaded the custodian to release eight cars, which he sold for his own benefit. In 2008, Boliaux’s wife incorporated Joliet Motors, which Boliaux operated from the former EMC premises. Joliet Motors received installment payments from EMC customers but did not remit them to lenders. Boliaux began check kiting. He was convicted of four counts of wire fraud and six of bank fraud, 18 U.S.C. 1343, 1344, and sentenced to 48 months’ imprisonment. The Seventh Circuit affirmed, rejecting arguments that the evidence was insufficient on the wire fraud counts because he did not transmit anything by wire, and on the bank fraud counts because no one from the banks testified that the banks lost money. The district judge properly declined to instruct the jury that it had to agree, unanimously, how Boliaux carried out his scheme. View "United States v. Boliaux" on Justia Law

Ray lives with diabetes, hypertension, obesity, kidney disease, degenerative disc disease, anxiety, and depression. When his conditions worsened, he began working gradually easier jobs, from janitor to forklift operator to bus monitor for children with special needs, until eventually, he gave up his employment entirely. An ALJ denied Ray’s application for Supplemental Security Income and Disability Insurance Benefits, finding that Ray was severely impaired by most of his physical conditions, but that the ALJ erroneously evaluated Ray’s symptoms and daily activities, misinterpreted medical evidence, and failed to ask why he skipped some appointments. he could perform his past relevant work as a school bus monitor. The Seventh Circuit vacated. The ALJ erroneously evaluated Ray’s symptoms and daily activities, misinterpreted medical evidence, and failed to ask why he skipped some appointments. Substantial evidence does not support the ALJ’s conclusion that Ray’s previous job was not a composite job. On remand, the ALJ should revisit her assessment of Ray’s mental impairment View "Ray v. Berryhill" on Justia Law

Reed alleged that she suffered discrimination on the basis of her disabilities while she was a patient at Columbia in March 2012. She contends that the hospital failed to accommodate her disabilities by deliberately withholding from her a device she used to speak and discriminated against her by putting her in a “seclusion” room to punish her, in violation of the Americans with Disabilities Act (ADA), 42 U.S.C. 12181, the Rehabilitation Act, 29 U.S.C. 794, and the Wisconsin Mental Health Act. The district court granted the hospital summary judgment, holding that the hospital did not need to comply with Title III of the ADA because it fell within the Act’s exemption for entities controlled by religious organizations and that the hospital’s alleged mistreatment of Reed was not premised solely on Reed’s disability. The Seventh Circuit reversed. The hospital raised its religious exemption affirmative defense to the ADA claims for the first time after discovery, in its motion for summary judgment; it was an abuse of discretion to excuse the hospital’s failure to raise this affirmative defense earlier. Reed’s Rehabilitation Act claims depend on disputed facts. View "Reed v. Columbia St. Mary's Hospital" on Justia Law

Winsted was 42 years old when he applied for disability benefits, asserting an onset date of October 2010. Although he initially alleged he became disabled in 2005, two prior applications alleging this onset date were denied and deemed administratively final. Winsted suffers from multiple physical impairments, including degenerative disc disease, osteoarthritis, and anxiety, mostly associated with his previous work in hard labor as an industrial truck driver, a highway maintenance worker, and an operating engineer. An ALJ denied benefits, finding that Winsted could work with certain limitations. The district court affirmed. The Seventh Circuit remanded. The ALJ did not adequately explain how the limitations he placed on Winsted’s residual functional capacity accounted for the claimant’s mental difficulties; the ALJ did not consider Winsted’s difficulties with concentration, persistence, and pace. View "Winsted v. Berryhill" on Justia Law

Between 2012 and 2013, the Kankakee, Illinois Detention Center prohibited inmates from receiving any newspapers. While awaiting trial on bank robbery charges, Miller’s family bought him a $279 subscription to the Chicago Daily Law Bulletin to help him with his case. Deeming the Law Bulletin a newspaper, jail officials precluded Miller from receiving it. Miller challenged the jail’s prohibition and confiscation of the publication and sought to recover the subscription fee. The district court addressed the broader question of whether the jail’s ban on all newspapers offended the First Amendment, upheld the newspaper ban, and awarded the defendants summary judgment. The Seventh Circuit vacated. The district court erred in reaching and resolving such a broad constitutional question. Miller’s claim was that Law Bulletin was a legal publication, not a newspaper; the record was not fully developed as it pertains to the jail’s restriction on legal publications. The court noted that the Center had no law library, and while inmates had access to an electronic database with Illinois legal resources, there was a dearth of material on federal law in the jail. The court further noted that the district court had not addressed Miller’s due process claim. View "Miller v. Downey" on Justia Law

Graham had worked at a Milwaukee Aldi for six years before being fired, for stealing, months before the first robbery. Graham used his knowledge of store procedures and that Aldi trains employees to acquiesce to robbers. Graham would enter a store minutes before closing, hide until it closed, then approach employees with his gun drawn. After his sixth robbery, Graham was arrested and pleaded guilty to six counts of Hobbs Act robbery, 18 U.S.C. 1951(a), and using a firearm during a crime of violence, 18 U.S.C. 924(c)(1)(A)(ii). The court calculated a Guidelines range of 78-97 months for each robbery, followed by a mandatory consecutive sentence of 84 months for the firearm conviction. Graham argued that for 30 years, he had worked two full-time jobs to support his girlfriend and six children, living a crime-free life until the financial pressures of six children, one with serious medical issues, drove him to use drugs, steal food, and, finally, rob his former employer. The court noted that Graham’s criminal conduct was well-planned and executed and that there was “too much” criminal conduct to justify the sentence Graham requested. The court considered “uniformity, proportionality, certainty, and cost,” and imposed concurrent sentences of 60 months’ imprisonment for each robbery, followed by the mandatory consecutive 84-month sentence.. The Seventh Circuit affirmed, finding no procedural error in the imposition of the below-Guidelines sentence. View "United States v. Graham" on Justia Law