Justia U.S. 3rd Circuit Court of Appeals Opinion Summaries

Articles Posted in Civil Procedure
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Larry Trent Roberts spent 13 years in prison for a murder that he did not commit. After being exonerated, he sued several state actors involved in obtaining his wrongful conviction, including Assistant District Attorney John C. Baer. The United States Court of Appeals for the Third Circuit held that Baer is not entitled to absolute immunity from liability under 42 U.S.C. § 1983 because his actions of seeking a new witness to establish a motive for the murder served an investigatory function, not a prosecutorial one. The court noted that prosecutors are not entitled to absolute immunity when they perform investigative functions normally performed by a detective or police officer. Baer argued that he was immune from liability as his conduct occurred post-charge and was designed to produce inculpatory evidence for trial. However, the court clarified that the timing of a prosecutor's actions as pre- or post-indictment and the presence or absence of a connection to a judicial proceeding are only "relevant considerations" in determining whether a prosecutor’s action served a prosecutorial function. They are not enough to establish that a prosecutor's post-charge effort to fabricate evidence for trial served a quasi-judicial function. The court affirmed the District Court's decision denying Baer's motion to dismiss. View "Roberts v. Lau" on Justia Law

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The case involved a dispute between Winn-Dixie Stores and the Eastern Mushroom Marketing Cooperative, Inc. (EMMC), its individual mushroom farmer members, and certain downstream distributors. Winn-Dixie accused the defendants of violating antitrust laws by engaging in a price-fixing agreement. The U.S. Court of Appeals for the Third Circuit held that the District Court was correct in applying the rule of reason, rather than a "quick-look" review, in assessing the legality of the defendants' pricing policy under the Sherman Act. The court found that the complex and variable nature of the arrangements within the cooperative, involving both horizontal and vertical components, necessitated a careful analysis to determine anticompetitive effects. The court also held that the jury's verdict, which found that the defendants' pricing policy did not harm competition, was not against the weight of the evidence and did not warrant a new trial. The court affirmed the District Court’s judgment in favor of the defendants. View "Winn Dixie Stores v. Eastern Mushroom Marketing Cooperative Inc" on Justia Law

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In this case, the plaintiff, Maria Del Rosario Hernandez, filed a lawsuit against MicroBilt Corporation alleging the company violated the Fair Credit Reporting Act after the lender denied her loan application based on inaccurate information provided by a MicroBilt product. MicroBilt moved to compel arbitration based on the terms and conditions that Hernandez agreed to while applying for the loan, which included an arbitration provision. However, Hernandez had already submitted her claims to the American Arbitration Association (AAA) for arbitration.The AAA notified MicroBilt that its agreement with Hernandez was a consumer agreement, which meant the AAA's Consumer Arbitration Rules applied. Applying these rules, the AAA notified MicroBilt that its arbitration provision included a material or substantial deviation from the Consumer Rules and/or Protocol. Specifically, the provision’s limitation on damages conflicted with the Consumer Due Process Protocol, which requires that an arbitrator should be empowered to grant whatever relief would be available in court under law or in equity. After MicroBilt did not waive the damages limitation, the AAA declined to administer the arbitration under Rule 1(d).MicroBilt asked Hernandez to submit her claims to a different arbitrator, but she refused, requesting a hearing before the District Court. She argued that she must now pursue her claims in court because the AAA dismissed the case under Rule 1(d). The District Court reinstated Hernandez’s complaint and granted MicroBilt leave to move to compel arbitration under 9 U.S.C. § 4. However, the District Court denied MicroBilt’s motion to compel, leading to this appeal.The United States Court of Appeals for the Third Circuit affirmed the lower court's decision, stating that Hernandez had fully complied with MicroBilt’s arbitration provision, which allowed her to pursue her claims in court. The court held that it lacked the authority to compel arbitration. The court rejected MicroBilt's arguments that the AAA administrator improperly resolved an arbitrability issue that should have been resolved by an arbitrator, that the provision’s Exclusive Resolution clause conflicted with Hernandez’s return to court, and that the AAA’s application of the Consumer Due Process Protocol was unreasonable. The court concluded that it lacked the authority to review the AAA’s decision or to sever the damages limitation from the arbitration provision. View "Hernandez v. MicroBilt Corp" on Justia Law

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Janssen spent 10 years and over half a billion dollars developing an injectable version of the cancer drug trabectedin and patented some of the manufacturing processes. The data, specifications, and manufacturing methods were kept confidential as trade secrets. In 2015, the FDA approved the drug, Yondelis, for use in certain cancer patients. Two years later, two competitors—a Chinese corporation, and its U.S. subsidiary, eVenus—sought FDA approval to sell a generic version of Yondelis. Janssen sued for patent infringement. During discovery, Janssen obtained documents that indicated the defendants misappropriated trade secrets. Janssen filed another lawsuit under the Defend Trade Secrets Act, 18 U.S.C. 1836 (DTSA), became convinced that the defendants had spoliated evidence, and filed an ex parte application, asking that U.S. Marshals seize eVenus’s network servers and stored data, and certain laptops and cell phones.The district court denied the application, concluding that Janssen had not shown that eVenus was in actual possession of the property or that eVenus’s property was at the location of the proposed seizure. It also found an insufficient showing of immediate and irreparable harm or immediate concern for spoliation and that the seizure would encompass company information not limited to the matters at issue. The Third Circuit dismissed an appeal for lack of jurisdiction. A DTSA seizure order is directed to law enforcement—not a party against whom the order could be enforced by threat of contempt–so the order did not effectively deny an injunction. View "Janssen Products LP v. Evenus Pharmaceuticals Laboratories Inc" on Justia Law

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Huber visited Crozer doctors on four separate occasions, incurring debts to Crozer of $178, $78, $83.50, and $178. Crozer's debt collection agency, SAI, sent a form collection letter, with an “Account Summary” that provided two figures: the specific debt SAI sought to collect, entitled “Amount,” and a second figure, entitled “Various Other Acc[oun]ts Total Balance.” The fourth such letter to Huber informed Huber that she owed an “Amount” of $178, while her “Various Other Accounts Total Balance” was $517.50. Huber testified that she was confused as to how much she owed in total: Was it $695.50 or $517.50. She consulted a financial advisor.Huber filed this putative class action, asserting a “false, deceptive, or misleading” means of collecting a debt and failure to disclose the “amount of the debt” under the Fair Debt Collection Practices Act, 15 U.S.C. 1692. The district court held, on summary judgment, that there was no actionable failure to disclose but found the letters “misleading and deceptive,” and certified the class.The Third Circuit affirmed. Huber has standing, but not under the “informational injury doctrine.” Huber did not identify omitted information to which she has entitlement but the financial harm she suffered in reliance on the letter bears a “close relationship” to the harm associated with the tort of fraudulent misrepresentation. The court remanded for determination of whether any of the class members suffered any consequences beyond confusion. View "Huber v. Simons Agency Inc" on Justia Law

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M.P.N. manufactures radiators in Philadelphia. Mercer worked at M.P.N. from 2015-2017. In 2019, Mercer sued., alleging that M.P.N. concealed blood test results showing that he had dangerously high levels of zinc and lead after he was exposed to lead and cadmium on the job. A physician advised M.P.N. to remove Mercer from work but M.P.N. ignored the advice. As a result, Mercer continued working at M.P.N. and suffered permanent, avoidable brain damage. The Pennsylvania Workers’ Compensation Act is the “exclusive” source of employer liability for suits relating to workplace injuries suffered by employees. Mercer argued that he could recover from M.P.N. under a “fraudulent misrepresentation” exception recognized by the Pennsylvania Supreme Court.Zenith Insurance sought a declaration that it was not contractually obligated to defend M.P.N., against a workplace liability lawsuit. In a partial summary judgment, the district court declared that Zenith has a duty to defend M.P.N. The Third Circuit dismissed an appeal. Because the district court did not rule on all of the claims before it, that order is not final and cannot be appealed under the usual source of jurisdiction, 28 U.S.C. 1291. Zenith argued the court could consider its challenge under 28 U.S.C. 1292(a)(1), which permits appeals from non-final orders that relate to injunctive relief but the Third Circuit rule is that purely declaratory orders are not injunctive and cannot be enforced by contempt. View "Zenith Insurance Co. v. Newell" on Justia Law

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Epsilon, an Ohio corporation with a principal place of business in Texas, entered into Joint Operating Agreements (JOAs) with companies, including Chesapeake, an LLC whose sole member is an Oklahoma citizen, to develop natural gas in Pennsylvania. The JOAs require Chesapeake to “have full control of all operations on the Contract Area.” Chesapeake can be removed as Operator for good cause by a vote of the other JOA parties. The JOAs allow the “Non-Operator parties” to propose new well sites. The others have 30 days to decide whether to participate. The work is then ordinarily performed by Chesapeake. If Chesapeake does not approve the project, the Consenting Parties designate a Consenting Party as Operator. Chesapeake opposed wells proposed by Epsilon, then blocked Epsilon from operating the proposed project unilaterally.Epsilon sought a declaration to drill without Chesapeake’s participation. Chesapeake moved to dismiss the suit for failure to join the other JOA co-signatories. The district court dismissed for failure to state a claim. The Third Circuit remanded. The other contracting parties are required (Fed. R. Civ. P. 19(a)(1)). A declaratory judgment interpreting the JOAs to authorize a single Consenting Party to propose the drilling of a new well would affect all their interests. However, other Absent JOA Parties are citizens of Texas who cannot be feasibly joined without defeating diversity and destroying subject matter jurisdiction. Deciding whether to proceed without them requires findings by the trial judge. View "Epsilon Energy USA Inc. v. Chesapeake Appalachia LLC" on Justia Law

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Pretrial detainee Wilson complained to Philadelphia Federal Detention Center medical staff about a lump on his testicle in November 2017. They allegedly stated that such a lump was probably cancerous. Wilson subsequently complained that his condition worsened but received no further treatment. Wilson was transferred to Bureau of Prisons custody, where a urologist determined in February 2018 that the lump was cancerous. Wilson's right testicle was surgically removed. Wilson believed that if his cancer had been addressed earlier, treatment would not have involved chemotherapy and surgery.Wilson alleged medical negligence under the Federal Tort Claims Act (FTCA). The court granted extensions for Wilson (pro se) to act on Pennsylvania Rule 1042.3, which requires medical malpractice plaintiffs to certify either that they have expert support for their claims or will proceed without an expert. Wilson explained that he wanted an expert but conceded the impossibility of obtaining one during the pandemic prison lockdowns. He stated that his medical records would demonstrate that his injury “was not inevitable" and specifically identified documents as discoverable material to substantiate his allegations, The court granted the government summary judgment stating that, while a factfinder could find without expert testimony that the delay in treatment was unreasonable, the issue of whether the delay caused the need to remove Wilson’s testicle required expert testimony.The Third Circuit reversed, finding that the FTCA does not incorporate Rule 1042.3. Wilson did not otherwise have an adequate opportunity to seek out an expert or conduct discovery due to his unique position as a pro se inmate during the pandemic. View "Wilson v. United States" on Justia Law

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In 2022, New Jersey passed a law, N.J. Stat. 2C:58-33(a), that empowers only the state’s Attorney General to sue gun-industry members whose “unlawful … or unreasonable” conduct “contribute[s] to a public nuisance in [New Jersey] through the sale, manufacturing, distribution, importing, or marketing of a gun-related product.” It requires industry members to “establish, implement, and enforce reasonable controls” on these activities. The Attorney General has not attempted to enforce the law. Four months after the law was passed, the Foundation, a trade group of gun makers, retailers, and other industry members, filed suit, claiming that the law is preempted by the federal Protection of Lawful Commerce in Arms Act, 15 U.S.C. 7901–7903, and violates due process, the First and Second Amendments, and the dormant Commerce Clause. The Foundation moved for a preliminary injunction, attaching declarations that gunmakers “will continually be at risk of litigation and potential liability unless [they] cease[] doing business.” They gave no factual detail.The Third Circuit held that the challenges must be dismissed. “Pre-enforcement challenges are unusual,” the plaintiff must show that the stakes are high and close at hand. This suit “falls far short of even the “normal” pre-enforcement challenge.” A brand-new civil tort statute, without more, does not justify a federal court’s intervention. View "National Shooting Sports Foundation v. Attorney General New Jersey" on Justia Law

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MAE and Zaycosky entered an employment contract. They could not agree on when Zaycosky promised to start his employment, so MAE sued in the state court venue prescribed in the contract. Zaycosky removed the case to federal court. MAE moved for remand to enforce the contract’s forum-selection clause. The district court remanded. MAE timely submitted a petition for costs and fees and an affidavit supporting its request for $29,517.25. Zaycosky argued that the court lacked authority under 28 U.S.C. 1447(c) to award costs and attorney fees for a remand based on a forum-selection clause, and, alternatively, that a fee award was not warranted because he had an objectively reasonable basis for removal.The Third Circuit vacated the award. Section 1447(c) allows fee shifting only for remands where the removal failed to meet the statutory requirements or where the court lacks subject matter jurisdiction over the removed case. A forum-selection clause is not a removal defect and does not deprive the district court of subject matter jurisdiction, the district court cannot remand and award attorney fees under 28 U.S.C. 1447(c). View "Medical Associates of Erie v. Zaycosky" on Justia Law