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

The hospital, located in Philadelphia, received a reclassification into the New York City area, which would sizably increase the hospital’s Medicare reimbursements due to that area’s higher wage index, 42 U.S.C. 1395ww(d). Although a statute makes such reclassifications effective for three fiscal years, the agency updated the geographical boundaries for the New York City area before the close of that period and reassigned the hospital to an area in New Jersey with an appreciably lower wage index. The hospital successfully sued three agency officials in the Eastern District of Pennsylvania.The Third Circuit vacated and remanded for dismissal. The Medicare Act, 42 U.S.C. 1395oo(f)(1), channels reimbursement disputes through administrative adjudication as a near-absolute prerequisite to judicial review. The hospital did not pursue its claim through administrative adjudication before suing in federal court. By not following the statutory channeling requirement, the hospital has no valid basis for subject-matter jurisdiction. View "Temple University Hospital, Inc. v. Secretary United States Department of Health & Human Services" on Justia Law

Valeant develops and manufactures generic pharmaceuticals. Appellants purchased stock in Valeant after Valeant changed its business model to focus more on acquiring new drugs from other companies rather than developing its own. Valeant made promising representations about its financial performance based on its new business model. The price of Valeant stock skyrocketed nearly 350% in 2015. Before the district court addressed class certification in a putative class action on behalf of investors who purchased Valeant stock in 2015, alleging that the price was artificially inflated as a result of deceptive practices, the Appellants filed an “opt-out” complaint bringing the same claims in their individual capacities. The district court dismissed that complaint as untimely under the two-year limitations period.The Third Circuit vacated the dismissal. Putative class members may recover as part of the class or seek individual recourse. Members may initially proceed as part of a class, but certification may be denied later or members may discover that their individual claims are more valuable than the class claims and decide to pursue an opt-out complaint even if certification is likely. In either case, members are generally allowed to initiate an individual action. When a class complaint is filed, the limitations period governing the individual claims of putative members is tolled to protect the rights of putative members while avoiding needless identical lawsuits. Nothing further, such as a certification denial, is required to benefit from tolling. View "Aly v. Valeant Pharmaceuticals International, Inc." on Justia Law

Mondelli suffers from paranoid schizophrenia and major depression. During his daily 12-hour visits with his mother at Berkeley Heights, Mondelli allegedly observed inadequate care. Mondelli regularly complained to staff, the New Jersey Board of Health, and the Office of the Ombudsman for the Institutionalized Elderly. After several contentious visits, including police calls, Mondelli’s visits were limited to one to two hours per day in the lobby. Mondelli’s mother died.Mondelli filed suit, claiming ADA violations and intentional infliction of emotional distress. Despite several deadline extensions, Mondelli never cooperated in discovery. Mondelli explained that he suffers from various physical and mental health conditions; was found incompetent to stand trial in the Municipal Court of Fanwood; and has been unable to properly communicate with his lawyer. Mondelli supplied letters from physicians and a psychiatrist. The case was administratively terminated for 180 days, after which Mondelli moved to reopen. The district court denied Mondelli’s motion and, weighing the “Poulis” factors, dismissed his complaint with prejudice, finding that Mondelli was personally responsible for his failure to prosecute; that defendants were prejudiced by his failure to prosecute; that Mondelli had a history of dilatoriness; that no sanction other than dismissal would be appropriate; and that Mondelli’s ADA claim lacked merit.The Third Circuit vacated. There was verifiable evidence that placed Mondelli’s competency at issue; the court must examine his competency, as required by Federal Rule of Civil Procedure 17. View "Mondelli v. Berkeley Heights Nursing and Rehabilitation Center" on Justia Law

Brace, a farmer, owns hundreds of acres in Erie County, Pennsylvania. He cleared 30 acres of wetlands, draining it to grow crops. In 1994, the Third Circuit affirmed that Brace had violated the Clean Water Act. In 2012, Brade bought 14 additional acres of wetlands. Again, he engaged in clearing, excavation, and filling without required permits. During a second suit under the Act, Brace’s counsel submitted perfunctory pleadings and failed to cooperate in discovery, repeatedly extending and missing deadlines. Counsel submitted over-length briefs smuggling in extra-record materials. The court repeatedly struck Brace’s materials but generally chose leniency. Eventually, the court struck Brace’s opposition to summary judgment after analyzing the “Poulis factors,” then granted the government summary judgment on liability, holding that Brace had violated the Act. The court ordered Brace to submit a proposed deed restriction and restoration plan.The Third Circuit rejected Brace’s appeal. While “it stretches credulity [to believe that Brace had] no idea how counsel [wa]s conducting this case,” the court gave Brace the benefit of the doubt. Brace’s lawyer’s misconduct forced the government to waste time and money “deciphering incomprehensible pleadings, scouring through noncompliant briefs, and moving again and again for compliance" to no avail. Counsel acted in bad faith; repeated orders to show cause, warnings, and threats of sanctions did not deter counsel’s chronic misbehavior. The sanction “was hardly an abuse of discretion.” View "United States v. Brace" on Justia Law

Three clients filed separate discrimination cases, which were consolidated for discovery. The defendants obtained summary judgment. The clients filed a notice of appeal, then hired Paddick, who entered into a contingency fee agreement with each client, providing that Paddick would serve as counsel on remand and promising Paddick a 40 percent fee of any trial or settlement proceeds. Paddick prevailed in the appeal, then took 24 depositions, presented two oral arguments, attended two settlement conferences, and filed nine substantive motions or responses. When it came time to retain an expert witness, Paddick was unable to advance the necessary funds. The clients terminated their relationship with Paddick and retained Thompson to pursue their claims for a 35 percent contingent fee. Paddick informed Thompson of his work, noting that “fees remain due.” Thompson did not respond. The case settled for $380,000; Thompson’s share was $133,000. The district court acknowledged the settlements and dismissed the cases.A month later, Paddick successfully moved to intervene to enforce an attorney’s charging lien against the settlement proceeds. The Third Circuit affirmed an order that Thompson pay Paddick $54,562.73 from Thompson’s portion of the recovery. The district court had ancillary enforcement jurisdiction to resolve Paddick’s lien motion. The clients did not produce clear and convincing evidence of duress; imperfect representation does not necessarily bar Paddick from recovery. A client “should never be made to pay twice.” View "Butt v. United Brotherhood of Carpenters & Joiners of America" on Justia Law

Doe became a TCNJ tenure-track Assistant Professor in 2016, after giving birth to her third child. She alleges that the Dean and the Department Chair suggested that they were relieved that she would not need pregnancy-related accommodations in the future. Doe received positive reviews for 2017. Doe claims that after she became pregnant again, she was reassigned to a less desirable class. After Doe had her fourth child, the Dean, the Chair, and others, repeatedly asked whether she was done having children. She notified TCNJ that she was pregnant again. In 2018, a TCNJ professor attended the same class that the professor had positively reviewed in 2017 but entered a negative review; Doe claims there were no material changes. The Chair reported “non-material deficiencies” after having given her a positive review in 2017. Doe complained to the Provost, who allegedly “placed a record of discipline” in Doe’s personnel file for the Reappointment Committee. She claims she “suffered emotional trauma, became depressed, and had a miscarriage,” and that she was falsely accused of canceling classes, supported by “doctored” student comments. Doe was not reappointed.She filed suit, alleging gender, national origin, and pregnancy discrimination, and retaliation under Title VII of the Civil Rights Act. The Third Circuit affirmed the denial of her motion to proceed anonymously. Doe’s case does not merit appellate review under the collateral order doctrine. Nothing indicated that Doe’s interest in anonymity outweighs the public’s interest in open judicial proceedings. View "Doe v. The College of New Jersey" on Justia Law

Hamer underwent open-heart surgery using LivaNova’s 3T Heater-Cooler System. He developed an infection in the incision, which his physicians suspected stemmed from a non-tuberculosis mycobacterium (NTM). The hospital had experienced an outbreak of NTM infections in other patients who had undergone surgery using the 3T System. Hamer’s treatment team never isolated NTM from any of the swabs or cultures. Hamer, alleging that his treatment caused him lasting injuries, filed suit under the Louisiana Products Liability Act (LPLA) for failure to warn and inadequate design.Hamer’s case was transferred to Multidistrict Litigation case 2816, along with other cases alleging damages from the NTM infection caused by the 3T System. Case Management Order 15 (CMO 15) required plaintiffs to show “proof of NTM infection” through “positive bacterial culture results.” Hamer did not comply but opposed dismissal, claiming he had stated a prima facie claim under Louisiana law and sought remand.The Third Circuit reversed the dismissal. The court could have dismissed Hamer’s claims without prejudice, could have suggested remand, or could have dismissed Hamer’s claims with prejudice, if it found that Hamer had not stated a prima facie case under Louisiana law. .Under the LPLA, Hamer’s facts might state a prima facie case for defective design. Hamer’s allegations may diverge from those of other cases in MDL 2816 in which an NTM infection was verified but stating alternative theories of liability cannot justify foreclosing his claims. View "Hamer v. LivaNova Deutschland GMBH" on Justia Law

The Appellants, with a $594,000 Small Business Administration loan, bought a Harrisburg, Pennsylvania property that became a pub. They executed a note, mortgage, and unconditional guarantees, providing that federal law would control the enforcement of the note and guarantees and that they could not invoke any state or local law to deny their obligations. The Appellants defaulted on the loan and sold the property. The SBA allowed the sale to proceed but declined to release the Appellants from their loan obligations, which were assigned to CBE for collection. The Appellants sued, citing the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692, the Fair Credit Reporting Act (FCRA), 15 U.S.C. 1681, and the Pennsylvania Unfair Trade Practices and Consumer Protection Law (UTPCPL). CBE sought sanctions under Federal Rules 11 and 37, arguing that the Appellants brought frivolous claims and disobeyed discovery orders. The Appellants filed an untimely brief opposing sanctions and summary judgment, which did not include the separate responsive statement of material facts required by Local Rule. The district court granted summary judgment and denied the sanctions motions, reasoning that neither FDCPA not UTPCPL applies to commercial debts and the Appellants identified no material facts supporting their other claims. The Third Circuit affirmed and granted CBE FRAP 38 damages. The Appellants filed a brief that was essentially a copy of the one filed in the district court. The substance of their appeal “is as frivolous as its form.” View "Conboy v. United States Small Business Administration" on Justia Law

Motorized-wheelchair users filed a purported class action, alleging that Uber discriminated against individuals with mobility disabilities by not offering a “wheelchair accessible vehicle” (WAV) option in the Pittsburgh area, citing the Americans with Disabilities Act (ADA), 42 U.S.C. 12181. They argued that but for the unavailability of WAVs, Plaintiffs would download the Uber app and use its ridesharing service. Uber moved to compel arbitration under the Federal Arbitration Act, 9 U.S.C. 3–4, contending that although Plaintiffs had never registered for an Uber account or accepted its Terms of Use, they were nevertheless bound by the mandatory arbitration clause of that agreement; Plaintiffs could not establish standing to sue in federal court unless they “step into the shoes” of actual Uber Rider App users.The Third Circuit affirmed an order denying Uber’s motion. Plaintiffs’ failure to download the Uber app, agree to the terms and perform the “futile gesture” of requesting a WAV ride did not prevent them from pleading an injury in fact. Plaintiffs’ disability discrimination claim did not rely on or concerncUber’s Terms of Use, but was based on the ADA. On interlocutory appeal from the denial of a motion to compel arbitration, appellate jurisdiction is confined to review of that order; the court has no independent obligation to review non-appealable orders, even jurisdictional ones concerning standing. View "O'Hanlon v. Uber Technologies Inc" on Justia Law

A regulation promulgated under the National Traffic and Motor Vehicle Safety Act, 49 U.S.C. 30101, requires a tire dealer to help customers register their new tires with the manufacturer. The regulation prescribes three methods for tire dealers to help register a buyer’s tires. According to Thorne, Pep Boys failed to pursue any of the three when, or after, it sold her the tires. She sued on behalf of a class of Pep Boys customers who similarly received no tire registration assistance.The district court dismissed her complaint without leave to amend, holding that a dealer’s failure to help register a buyer’s tires in one of the three prescribed ways does not, by itself, create an injury-in-fact for purposes of Article III standing. The Third Circuit vacated and remanded for dismissal without prejudice. A district court has no jurisdiction to rule on the merits when a plaintiff lacks standing. Thorne’s benefit-of-the-bargain allegations do not support a viable theory of economic injury, and her product-defect argument ignores the statute’s defined terms. Unregistered tires are not worth less than Thorne paid and are not defective. Congress did not intend to give private attorneys general standing to redress the “injury” of unregistered tires. View "Thorne v. Pep Boys Manny Moe & Jack" on Justia Law