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The day Krieger fell victim to a credit card scam and discovered a fraudulent $657 charge on his bill, he contacted his card issuer, Bank of America (BANA), and was told that the charge would be removed and that, pending “additional information,” BANA considered the matter resolved. Krieger’s next bill reflected a $657 credit. Over a month later Krieger learned that BANA was rebilling him for the charge. He disputed it again, in writing. After BANA replied that nothing would be done, he paid his monthly statement and then filed suit, citing the Fair Credit Billing Act (FCBA), 15 U.S.C. 1666, which requires a creditor to take certain steps to correct billing errors, and the Truth in Lending Act (TILA), 15 U.S.C. 1601, which limits a credit cardholder’s liability for the unauthorized use of a credit card to $50. The Third Circuit reversed dismissal by the district court, first rejecting a claim that Krieger’s complaint was untimely. Only when BANA decided to reinstate the charge did the FCBA again become relevant, so that the 60-day period began to run. A cardholder incurs “liability” for an allegedly unauthorized charge when an issuer, having reason to know the charge may be unauthorized, bills or rebills the cardholder for that charge; the issuer must then comply with the requirements of section 1643, and when a cardholder alleges those requirements were violated, those allegations may state a claim under TILA section 1640. View "Krieger v. Bank of America NA" on Justia Law

Posted in: Banking, Consumer Law

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Sports Medicine performed shoulder surgery on “Joshua,” who was covered by a health insurance plan, and charged Joshua for the procedure. Because it did not participate in the insurers’ network, Sports Medicine was not limited to the insurer’s fee schedule and charged Joshua $58,400, submitting a claim in that amount to the insurers on Joshua’s behalf. The claim form indicated that Joshua had “authorize[d] payment of medical benefits.” The insurer processed Joshua’s claim according to its out-of-network cap of $2,633, applying his deductible of $2,000 and his 50% coinsurance of $316, issuing him a reimbursement check for the remaining $316, and informing him that he would still owe Sports Medicine the remaining $58,083. Sports Medicine appealed through the insurers’ internal administrative process and had Joshua sign an “Assignment of Benefits & Ltd. Power of Attorney.” Sports Medicine later sued for violations of the Employee Retirement Income Security Act (ERISA), and breach of contract, citing public policy. The district court dismissed for lack of standing because Joshua’s insurance plan included an anti-assignment clause. The Third Circuit affirmed, holding that the anti-assignment clause is not inconsistent with ERISA and is enforceable. View "American Orthopedic & Sports Medicine v. Independence Blue Cross Blue Shield" on Justia Law

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Rotkiske accumulated credit card debt in 2003-2005, which his bank referred to Klemm for collection. Klemm sued for payment in March 2008 and attempted service at an address where Rotkiske no longer lived but withdrew its suit when it was unable to locate him. Klemm tried again in January 2009, refiling its suit and attempting service at the same address. Unbeknownst to Rotkiske, somebody at that residence accepted service on his behalf. Klemm obtained a default judgment. Rotkiske discovered the judgment when he applied for a mortgage in September 2014. In June 2015, Rotkiske sued under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692 . The district court dismissed the suit as untimely, rejecting Rotkiske’s argument that the Act’s statute of limitations incorporates a discovery rule which “delays the beginning of a limitations period until the plaintiff knew of or should have known of his injury.” The text at issue reads: An action to enforce any liability created by this subchapter may be brought . . . within one year from the date on which the violation occurs, section 1692k(d). The Third Circuit affirmed, based on the statutory text. Congress’s explicit choice of an occurrence rule implicitly excludes a discovery rule. View "Rotkiske v. Klemm" on Justia Law

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Under the Individuals with Disabilities Education Act (IDEA), an administrative due process complaint about a child's educational placement can result in an administrative hearing. At least 10 days before the hearing, the school district can extend a “10-day” settlement offer, 20 U.S.C. 1415(i)(3)(D)(i)(I)-(III). That offer limits a parent’s eligibility for attorney’s fees to only those fees accrued before the offer. If a parent rejects the offer, the parent may only receive attorney’s fees for work done after the offer if the hearing leads to more favorable relief than the offer included, or the parent was substantially justified in rejecting the offer. Rena filed a complaint against the Colonial School District to determine an appropriate placement for her daughter. Colonial extended and Rena rejected a 10-day offer. After a hearing, an administrative officer ordered a private school placement for the student. The district court awarded Rena attorney’s fees only for work performed before the offer. The Third Circuit reversed, holding that Rena was substantially justified in rejecting Colonial’s offer. Colonial made a valid offer of settlement and Rena did not receive more favorable relief in the administrative order but she was substantially justified in rejecting the offer because it did not address attorney’s fees. View "Rena C. v. Colonial School District" on Justia Law

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LWI sued for cargo damage sustained during a trip to Camden, New Jersey, on the Ocean Quartz (Vessel). Liability for the damage is governed by the carrier’s bill of lading, which contains a forum selection clause requiring suit to be brought in South Korea. LWI instead sought to bring an in rem suit against the Vessel in the District of New Jersey, arguing that the foreign forum selection clause violates the Carriage of Goods by Sea Act (COGSA), 46 U.S.C. 30701, because South Korea does not allow in rem suits. The Third Circuit affirmed the dismissal of the suit. While foreign forum selection clauses were originally disfavored under COGSA, the Supreme Court later adopted a policy that better reflected the need to respect the competence of foreign forums to resolve disputes. The court rejected an argument that that COGSA designates in rem suits as substantive rights, which are violated by the forum selection clause. LWI’s own willful limitation of alternatives, not the forum selection clause, has eliminated its ability to recover. View "Liberty Woods International Inc. v. Motor Vessel Ocean Quartz" on Justia Law

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Little Sisters of the Poor, a Roman Catholic congregation serving the elderly poor of all backgrounds, operates homes for the elderly, all of which adhere to the same religious beliefs. A religious nonprofit corporation that operates a Little Sisters home in Pittsburgh sought to intervene in litigation challenging regulations promulgated under the Patient Protection and Affordable Care Act, 42 U.S.C. 300gg-13(a)(4). That litigation was instituted by the Commonwealth of Pennsylvania, challenging interim final rules, providing for “religious” and “moral “ exemptions to the Act's "contraceptive mandate" for “entities, and individuals, with sincerely held religious beliefs objecting to contraceptive or sterilization coverage,” including “for-profit entities that are not closely-held.” The Third Circuit reversed the denial of their motion. Little Sisters’ interest in the regulations is neither novel nor isolated; it has been involved in Affordable Care Act litigation for years. Little Sisters’ interest in preserving the religious exemption is concrete and capable of definition; the relationships among the organization's various homes indicate a unique interest compared to other religious objectors who might wish to intervene. Those interests are significantly protectable. Little Sisters have demonstrated that they may be “practically disadvantaged by the disposition of the action” and have established that their interests are not adequately represented by the federal government. View "Commonwealth of Pennsylvania v. President United States" on Justia Law

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In 2015, former Virgin Islands Senator James was charged with wire fraud, 18 U.S.C. 1343, and federal programs embezzlement, 18 U.S.C. 666(a)(1)(A), stemming from his use of legislative funds to ostensibly obtain historical documents from Denmark related to the Fireburn, an 1878 St. Croix uprising. The indictment specified: obtaining cash advances from the Legislature but retaining a portion of those funds for his personal use; double-billing for expenses for which he had already received a cash advance; submitting invoices and receiving funds for translation work that was never done; and submitting invoices and receiving funds for translation work that was completed before his election to the Legislature. James, who argued that he was engaged in legislative fact-finding, moved to dismiss the indictment on legislative immunity grounds. The district court denied the motion, stating that James’ actions were not legislative acts worthy of statutory protection under the Organic Act of the Virgin Islands. The Third Circuit affirmed. Under 48 U.S.C. 1572(d) legislators are protected from being “held to answer before any tribunal other than the legislature for any speech or debate in the legislature." The conduct underlying the government’s allegations concerning James is clearly not legislative conduct protected by section 1572(d). View "United States v. James" on Justia Law

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In 2015, former Virgin Islands Senator James was charged with wire fraud, 18 U.S.C. 1343, and federal programs embezzlement, 18 U.S.C. 666(a)(1)(A), stemming from his use of legislative funds to ostensibly obtain historical documents from Denmark related to the Fireburn, an 1878 St. Croix uprising. The indictment specified: obtaining cash advances from the Legislature but retaining a portion of those funds for his personal use; double-billing for expenses for which he had already received a cash advance; submitting invoices and receiving funds for translation work that was never done; and submitting invoices and receiving funds for translation work that was completed before his election to the Legislature. James, who argued that he was engaged in legislative fact-finding, moved to dismiss the indictment on legislative immunity grounds. The district court denied the motion, stating that James’ actions were not legislative acts worthy of statutory protection under the Organic Act of the Virgin Islands. The Third Circuit affirmed. Under 48 U.S.C. 1572(d) legislators are protected from being “held to answer before any tribunal other than the legislature for any speech or debate in the legislature." The conduct underlying the government’s allegations concerning James is clearly not legislative conduct protected by section 1572(d). View "United States v. James" on Justia Law

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GBForefront, a limited partnership, sued FMG, an LLC, alleging diversity jurisdiction (28 U.S.C. 1332) because GBForefront’s general partner was an LLC whose sole member was a “resident” of Pennsylvania; none of FMG’s members were Pennsylvania residents. Years later, GBForefront accepted an offer of judgment. The district court entered judgment. Problems arose with satisfaction of the judgment; the parties submitted a joint motion to amend the judgment to effectuate a new agreement, which the court granted. GBForefront soon alleged default and moved for entry of a consent judgment under the new agreement. Defendants then cross-moved to dismiss the case for lack of subject matter jurisdiction, claiming that GBForefront had not adequately pled the citizenship of FMG and that complete diversity was lacking when the lawsuit was filed. The Supreme Court then issued its opinion in Americold Realty, dealing with the citizenship of trusts. The district court then dismissed, finding that the membership of GBForefront included trusts whose beneficiaries were New Jersey citizens and FMG also had a member who was a New Jersey citizen. Abrogating its own precedent, the Third Circuit vacated, concluding that the citizenship of a traditional trust is based only on the citizenship of its trustee. The court remanded with instructions to determine whether the trusts are of the traditional or business variety and whether there is diversity jurisdiction. View "GBForefront LP v. Forefront Management Group LLC" on Justia Law

Posted in: Civil Procedure

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Grant was 16 years old when he committed crimes that led to his incarceration. He was convicted in 1992 under the Racketeer Influenced and Corrupt Organizations Act and for drug trafficking. The court determined that Grant would never be fit to reenter society and sentenced him to life in prison without the possibility of parole (LWOP) for the RICO convictions with a concurrent 40-year term for the drug convictions and a mandatory consecutive five-year term for a gun conviction. In 2012, the Supreme Court decided, in Miller v. Alabama, that only incorrigible juvenile homicide offenders who have no capacity to reform may be sentenced to LWOP and that all non-incorrigible juvenile offenders are entitled to a “meaningful opportunity to obtain release based on demonstrated maturity and rehabilitation.” The court resentenced Grant to a term of 65 years without parole. Grant argued that the sentence constitutes de facto LWOP. The Third Circuit vacated Grant’s sentence. A sentence that either meets or exceeds a non-incorrigible juvenile offender’s life expectancy violates the Eighth Amendment; courts must hold evidentiary hearings to determine the non-incorrigible juvenile offender’s life expectancy and must consider as sentencing factors his life expectancy and the national age of retirement, with the section 3553(a) factors, to properly structure a meaningful opportunity for release. View "United States v. Grant" on Justia Law