Articles Posted in Civil Procedure

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Brickhouse appealed a default judgment in a trademark dispute between the parties. The court held that it had appellate jurisdiction in this case because a motion to recall the mandate and a motion to reopen the case have the same effect; the clerk had the power to recall the mandate here; and its order reopening the case did recall the mandate. The court rejected Brickhouse's claim that service of process was invalid; held that service was unremarkable in this case; and affirmed the default judgment. View "BHTT Entertainment v. Brickhouse Cafe & Lounge" on Justia Law

Posted in: Civil Procedure

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Renegade Swish filed suit against Emily Wright in state court for breach of employment agreement-related claims, and Wright counter-claimed based on violations of the Fair Labor Standards Act (FLSA). Renegade Swish nonsuited its claims without prejudice and moved to realign the parties in the state court. Renegade Swish then removed to federal court, and Wright moved for remand and attorney's fees. Even assuming arguendo that it use the abuse of discretion standard on review, the Fifth Circuit found that Renegade Swift did not have an objectively reasonable basis to remove to federal court, and the district court abused its discretion in finding otherwise. Renegade Swish has not identified an actual district court split as to whether removal is proper on the basis of federal counterclaims after a plaintiff nonsuits its claims. Accordingly, the court vacated in part and remanded for further proceedings. View "Renegade Swish, LLC v. Wright" on Justia Law

Posted in: Civil Procedure

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At issue in this appeal was the computation of economic losses arising out of the BP oil spill and based on the BP Settlement Agreement. The district court approved a policy adopted by the Claims Administrator (Policy 495) that consists of five methodologies to calculate claimant compensation: one Annual Variable Margin Methodology (AVMM) and four Industry-Specific Methodologies (ISMs). The Fifth Circuit held that the AVMM was consistent with the text of the Settlement Agreement, but that the four ISMs were not. The district court erred in approving the ISMs because they required the Claims Administrator to move, smooth, or otherwise reallocate revenue in violation of the Settlement Agreement. However, the ISMs, also required the Claims Administrator to match all unmatched profit and loss statements. Accordingly, the court affirmed as to the AVMM, reversed as to the ISMs, and remanded for further proceedings. View "In re: Deepwater Horizon" on Justia Law

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Plaintiff filed suit against his former employer, GE, alleging claims of discrimination and retaliation. The district court granted GE's motion to compel arbitration and dismissed the case, only to reopen it later to withdraw its prior order compelling the arbitration. The Fifth Circuit held that the district court lacked subject matter jurisdiction to withdraw its order compelling arbitration and reopen the case due to a default in the arbitral process. Therefore, the Fifth Circuit vacated and remanded for further proceedings, noting that the district court's jurisdiction was limited to determining whether an agreement to arbitrate still existed and enforcing that agreement. View "Salas v. GE Oil & Gas" on Justia Law

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The Fifth Circuit vacated the district court's grant of BDO's request for a protective order, holding that BDO did not prove its prima facie case of attorney-client privilege as to all of the log entries at issue, and that a protective order was unwarranted. The EEOC brought a subpoena enforcement action against BDO, seeking production of information relating to an employment discrimination investigation and asserting that BDO's privilege log failed to establish that the attorney-client privilege protected the company's withheld documents. The Fifth Circuit concluded that the log had three types of deficiencies that prevent the court from determining the applicability of the privilege: (a) entries that are vague and/or incomplete, (b) entries that fail to distinguish between legal advice and business advice, and (c) entries that fail to establish that the communications were made in confidence and that confidentiality was not breached. Because the magistrate judge's incorrect application of the legal standard may have affected both her analysis of the allegedly disclosed communications and the breadth of the protections she imposed in her order, the Fifth Circuit remanded so that BDO's request for protection may be considered under the proper legal standard for determining privilege. View "EEOC v. BDO USA" on Justia Law

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Wise Regional, a Texas municipal hospital authority, filed suit against Aetna, an insurance plan administrator, in state court over a dispute regarding medical insurance claims Wise Regional submitted on behalf of its patients. Aetna removed to federal court under 28 U.S.C. 1442, but the district court remanded to state court, awarding attorneys' fees. The court concluded that it had appellate jurisdiction over the remand order because Aetna relied upon the federal officer removal statute in its notice of removal; remand was proper because Aetna's notice of removal was untimely; and the district court did not abuse its discretion in awarding attorneys' fees where Aetna lacked an objectively reasonable basis for seeking removal of this action almost five months after expiration of the thirty-day deadline for removal. Accordingly, the court affirmed the judgment. View "Decatur Hospital Authority v. Aetna Health, Inc." on Justia Law

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Plaintiff filed suit against his former employer, Macy's, and his former supervisor, John Lillard, in state court. Macy's removed to federal court, plaintiff moved to remand, and Lillard moved to dismiss. The district court denied plaintiff's motion to remand, granted Lillard's motion to dismiss, and entered final judgment for Lillard under Federal Rule of Civil Procedure 54(b). Plaintiff alleged that defendants discriminated against him based on his PTSD condition. The court agreed with the district court that it had no reasonable basis to predict that plaintiff might be able to recover against Lillard for tortious interference because plaintiff failed to allege that Lillard was acting to serve his own personal interests. Therefore, plaintiff failed to adequately plead that Lillard acted willfully and intentionally at the expense of Macy's. The court held that once the district court determined that Lillard was improperly joined, the district court effectively dismissed plaintiff's claim against him without prejudice. The court remanded with instructions to vacate the district court's grant of Lillard's motion to dismiss his claims with prejudice. View "Alviar, Jr. v. Lillard" on Justia Law

Posted in: Civil Procedure

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Plaintiffs, former American and British soldiers assigned to protect employees of an industrial water injection facility, filed suit claiming that KBR did not responsibly handle the contamination at the facility, leading plaintiffs to suffer injuries stemming from hexavalent chromium exposure. The district court granted summary judgment for KBR. The court concluded that the political question doctrine does not bar the court's review of this case where, under Lane v. Halliburton, this appeal primarily raised legal questions that may be resolved by the application of traditional tort standards. On the merits, the court concluded that plaintiffs have not adduced sufficient evidence to prove that exposure to sodium dichromate caused their injuries based on a reasonable medical probability and scientifically reliable evidence. Accordingly, the court affirmed the judgment. View "McManaway v. KBR, Inc." on Justia Law

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KPCC filed suit against KBR, a general contractor supporting the Government's military operations in Iraq, alleging claims for breach of contract, fraud, and promissory estoppel. At issue was a 2010 contract for, inter alia, KBR's leasing, with an option to purchase, a dining facility constructed by KPCC in Iraq. The district court dismissed the complaint, concluding that the political-question doctrine rendered nonjusticiable the contract dispute at issue. Applying de novo review, under the discriminating inquiry required by Baker v. Carr, the court concluded that the claims presented required resolution of contractual disputes for which there existed judicially manageable standards. Therefore, there was no justiciable political question. The court disposed of KBR's remaining claims regarding the act-of-state doctrine and regarding a contractor's defense from its strict execution of a constitutionally authorized government order. Accordingly, the court vacated the district court's judgment and remanded. View "Kuwait Pearls Catering Co. WLL v. Kellogg Brown & Root Services, Inc." on Justia Law

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Peachtree filed suit against Rapid for tortious interference with its contracts. Peachtree and Rapid are two companies in the business of identifying individuals who are the beneficiaries of structured settlements, which provide a stream of payments, much like an annuity, usually over an extended period of years; once an annuitant is identified, the companies offer to purchase the stream of payments in return for a lump sum. The district court dismissed the claims and both parties appealed. The court held that plaintiffs failed to meet their burden of establishing either federal question or federal diversity jurisdiction. Therefore, federal courts have no subject matter jurisdiction over this case. The court vacated and remanded with directions to remand the case to state court. View "Settlement Funding, LLC v. Rapid Settlements" on Justia Law