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

HyreCar is an intermediary between people who own vehicles and people who would like to drive for services such as Uber and GrubHub. Before leasing a car, HyreCar sends an applicant’s information, including a photograph, to Mitek, which provides identity-verification services. Johnson, a HyreCar driver, brought a putative class action, alleging Mitek used that information without the consent required by the Illinois Biometric Privacy Act. Mitek asked the district court to send the case to arbitration, citing an Arbitration Agreement in Johnson’s contract with HyreCar, applicable to drivers, HyreCar, and “any subsidiaries, affiliates, agents, employees, predecessors in interest, successors, and assigns, as well as all authorized or unauthorized users or beneficiaries of services or goods provided under the Agreement.The district court concluded that suppliers such as Mitek were not covered. The Seventh Circuit affirmed, rejecting Mitek’s claim that it is a “beneficiary of services or goods provided under the Agreement.” The “services or goods provided under the Agreement” are vehicles. Mitek cannot be classified as a “user” of HyreCar’s services or goods. Mitek has its own contract with HyreCar, but does not have a contract with any HyreCar driver. The Federal Arbitration Act, 9 U.S.C. 2 does not change the result. The court noted that claims under the Illinois Act cannot be litigated in federal court unless the plaintiff can show concrete harm. Johnson seeks only statutory damages. Johnson’s claim must be remanded to state court. View "Johnson v. Mitek Systems, Inc." on Justia Law

Barsanti was delinquent on $1.1 million of senior secured debt it owed to BMO Harris Bank. Barsanti’s owner, Kelly, hired attorney Filer and Gereg, a financing consultant. After negotiations with BMO failed, Filer introduced Gereg to BMO as a person interested in purchasing Barsanti’s debt. Filer created a new company, BWC, to purchase the loans. BWC purchased the loans from BMO for $575,000, paid primarily with Barsanti’s accounts receivable. Barsanti also owed $370,000 in delinquent benefit payments to the Union Trust Fund. Filer, Kelly, and Gereg used BWC’s senior lien to obtain a state court judgment against Barsanti that allowed them to transfer Barsanti’s assets beyond the reach of the Union Fund, using backdated documents to put confession-of-judgment clauses into the loan documents and incorrectly claiming that Barsanti owed BWC $1.58 million. Filer then obtained a court order transferring Barsanti’s assets to BWC, which then transferred the assets to Millwork, another new entity, which continued Barsanti’s business after the Illinois Secretary of State dissolved Barsanti for unpaid taxes. Gereg was Millwork's nominal owner in filings with the Indiana Secretary of State. Barsanti filed for bankruptcy. Filer instructed others not to produce certain documents to the bankruptcy trustee.After a jury convicted Filer of wire fraud 18 U.S.C. 1343., the district court granted his motions for a judgment of acquittal. The Seventh Circuit reversed and remanded. The evidence was sufficient to support the jury’s verdicts. View "United States v. Filer" on Justia Law

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

Ryan sought worker’s compensation and entered into a settlement with his employer, calling for "$150,000 to Rodney Ryan, minus attorney fees and costs listed below; $400,000 to the Trust Account of Fortune & McGillis for disbursement to medical providers and lienholders, it being understood that from any balance remaining Mr. Ryan shall receive 80% and Fortune & McGillis shall receive 20%.” Fortune, Ryan’s law firm, received $30,000 in fees. The employer agreed to fund a Medicare Set Aside for Ryan’s future medical expenses. A state administrative law judge approved the Settlement.Weeks later, before any of the $400,000 was distributed to his doctors, Ryan filed for bankruptcy and attempted to exempt the $400,000 from the estate, citing Wisconsin Statutes 102.27(1), which says no “claim for [worker’s] compensation, or compensation awarded, or paid, [may] be taken for the debts of the party entitled thereto.” Ryan owed more than $800,000 in unpaid medical bills. His medical creditors cited Section 102.26(3)(b)(2), “[a]t the request of the claimant[,] medical expense[s], witness fees[,] and other charges associated with the claim may be ordered paid out of the amount awarded.” The district court and Sixth Circuit affirmed the bankruptcy court holding that Ryan could not exempt the $400,000. The Order created an express trust in favor of the doctors with Fortune as trustee. There were also "grounds to impose a constructive trust because allowing Ryan to keep the $400,000 would have amounted to unjust enrichment.” View "Ryan v Branko Prpa MD LLC" on Justia Law

Five days after Carter was booked into the Macon County Jail, he died of diabetic ketoacidosis. In the hours preceding his death, Carter exhibited symptoms commonly associated with diabetic ketoacidosis: confusion, lethargy, and labored breathing. He was denied timely medical care because the jail nurse thought he was faking his condition. She assured the corrections officers tasked with transferring Carter out of the medical unit that his vitals were within a normal range. Relying on the nurse’s medical judgment, the officers declined to intervene and proceeded to relocate Carter, believing that his failure to follow orders stemmed from deliberate refusal, not medically induced incapacity.In a suit under 42 U.S.C. 1983, including claims against five corrections officers, the district court denied the officers’ summary judgment based on qualified immunity, finding there to be a material factual dispute over whether they had reason to know that Carter was receiving inadequate medical care, creating a duty to intervene. The Seventh Circuit reversed. Established circuit precedent entitles a corrections officer to defer to the judgment of medical professionals. That is what the officers did here; they are entitled to qualified immunity. View "McGee v. Parsano" on Justia Law

Dorsey, an Illinois state prisoner, was emptying a bucket in the prison laundry when he felt a pop in his lower back and felt pain shoot down his leg. He asked to see a nurse and was told to “go lay down.” Dorsey took ibuprofen and lay down for two hours, but his pain worsened. He again, unsuccessfully, requested permission to seek medical care. The next morning, Dorsey could barely move. Six days later, a nurse concluded that he was exaggerating his symptoms. Dorsey alleges that instead of being treated for back pain, he was prescribed psychiatric medications without his knowledge or consent and was disciplined for refusing to take those medications.Dorsey sued. The district court screened his complaint under 28 U.S.C. 1915A and determined that Dorsey had improperly joined unrelated claims. His complaint asserted three claims under 42 U.S.C. 1983 against 12 defendants. Two claims alleged Eighth Amendment violations based on the poorly maintained washing machines and deliberate indifference to a serious medical condition, his back injury. The third alleged a due process violation, that Dorsey was prescribed medications without his consent. After deeming three amended complaints unsatisfactory, the district court dismissed the case. The Seventh Circuit reversed in part. Dorsey’s claims met both requirements of Rule 20(a)(2), so joinder was legally permissible and the dismissal was an abuse of discretion. The court rejected his other claims. View "Dorsey v. Varga" on Justia Law

After exchanging hundreds of messages with an FBI agent—who posed first as an 18-year-old woman and then as a 15-year-old girl—and driving to a planned rendezvous at a gas station, Anderson was convicted of attempted enticement of a minor, 18 U.S.C. 2422(b). Anderson appealed whether he offered sufficient evidence of entrapment to have the jury instructed on that defense. Seventh Circuit precedent holds that a defendant who offers “some evidence” of both government inducement and his own lack of predisposition is entitled to have the entrapment defense submitted to the jury.The Seventh Circuit remanded for a new trial in which Anderson should be permitted to present his entrapment defense. On this record, a jury could find government inducement in the form of “subtle, persistent, or persuasive conduct.” As for predisposition, Anderson had no record of any sexual misconduct or any other offenses against children. It was the government agent, not Anderson, who first suggested a criminal liaison. Anderson repeatedly expressed reluctance, and the agent responded with persistent coaxing and persuasion. Anderson agreed to meet for sex with someone he thought was an underage girl but whether his entrapment defense should succeed was an issue for the jury. View "United States v. Anderson" on Justia Law

After the Illinois Department of Transportation (IDOT) terminated McHugh’s employment, he sued seven individuals under federal law, alleging due process violations, and sued IDOT under an Illinois statute, the Ethics Act. IDOT argued that sovereign immunity under the Eleventh Amendment barred the suit. The district court held that McHugh’s claim against IDOT could proceed in state court but not federal court, and entered judgment on the merits. The Seventh Circuit modified the judgment to dismissal for lack of jurisdiction. If a defendant enjoys Eleventh Amendment immunity from a claim and invokes that immunity, it deprives a federal court of jurisdiction over the claim. View "McHugh v. Illinois Department of Transportation" on Justia Law

Wallace and Santos, inmates at Menard Correctional Center in Illinois filed suit under 42 U.S.C. 1983, alleging that Menard’s “double-ceiling” policy of housing two inmates in single-person cells violated their Eighth Amendment rights. The district court dismissed for failure to exhaust administrative remedies under the Prison Litigation Reform Act (PLRA), 42 U.S.C. 1997e.The Seventh Circuit reversed in part. Where a plaintiff is able to point to some evidence that administrative remedies were not “available” to him under the PLRA, as described by the Supreme Court in its 2016 Ross v. Blake decision, the district court must decide whether remedies were “available” before granting summary judgment on exhaustion. The plaintiffs claimed to have submitted grievances, offered some evidence that other inmates complained of the same issue with no response, and cited a mechanism by which prison officials can allegedly use state law to reject their grievances without any consideration of their merits. The court remanded for consideration of the exhaustion question as it applies to double-celling at Menard. If the district court finds that double-celling remedies were “available,” then the PLRA’s exhaustion requirement applies. The court affirmed a factual determination that Santos did not file a grievance regarding Menard’s double-celling policy. View "Wallace v. Baldwin" 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