Justia U.S. 1st Circuit Court of Appeals Opinion Summaries

In the underlying putative class action, counsel for the named plaintiffs obtained a collection of records owned by JPMorgan Chase Bank, N.A. (Chase). Plaintiffs sought to rely on the documents to pursue claims sounding in fraud, deceit, and conversion against Chase. A dispute arose as to whether portions of the Chase records were shielded from discovery and litigation under a provision of Bank Secrecy Act and related regulations. A magistrate judge reviewed all of the disputed documents in camera and concluded that the majority of the documents were not shielded by statute or regulation. Chase then initiated this mandamus proceeding, asking the First Circuit to intervene by declaring that the Act and related regulations shielded an additional fifty-five pages of Chase records from production or use in the putative class action. The First Circuit denied the petition for writ of mandamus, holding that, even assuming that the Act and regulations apply, the documents at dispute would not be shielded from discovery or use in litigation. View "In re JPMorgan Chase Bank, N.A." on Justia Law

Plaintiff filed claims individually and on behalf of three putative classes against Defendant seeking damages and injunctive relief under the Telephone Consumer Protection Act. Prior to the parties’ agreed-upon deadline for the class certification motion that Plaintiff announced it would pursue, Defendant tendered to Plaintiff an offer for judgment under Fed. R. Civ. P. 68. Four days after receiving the offer, Plaintiff moved for class certification. The unaccepted offer was subsequently withdrawn due to Plaintiff’s failure to respond to the offer. Thereafter, Defendant moved to dismiss for lack of matter jurisdiction, arguing that its unaccepted and withdrawn Rule 68 offer resolved any case or controversy between the parties, thereby mooting Plaintiff’s claims. The district court denied the motion to dismiss. The First Circuit affirmed, holding that a rejected and withdrawn offer of settlement of the named plaintiff’s individual claims in a putative class action made before the named plaintiff moves to certify a class does not moot the named plaintiff’s claims and divest the court of subject matter jurisdiction. View "Bais Yaakov of Spring Valley v. ACT, Inc." on Justia Law

This appeal arose out of the settlement of a securities class action brought on behalf of the purchasers of certain common stock of a corporation. Those who objected to the settlement and appealed the rejection of their objection argued that they were given too little time to register objections with the district court and that the district court should not have approved the amount of attorneys’ fees awarded to class counsel. The First Circuit (1) affirmed the district court’s rejection of the objections at issue, as the objectors had notice in fact and a sufficient opportunity to have any of their objections heard by the court before it approved the settlement; and (2) dismissed the objectors’ appeal from the court orders approving the settlement and award of counsel fees, as the objectors had no standing to complain about the fee award. View "Hill v. State Street Bank Corp." on Justia Law

In this putative class action against the manufacturer of Lexapro, Forest Pharmaceuticals, Inc., Plaintiffs claimed that Lexapro’s FDA-approved drug label misleads California consumers by omitting material efficacy information in violation of California’s Consumer Legal Remedies Act, False Advertising Law, and Unfair Competition Law. As relief, Plaintiffs requested that the court permanently enjoin Forest from continuing to sell or market Lexapro with its current drug label and to direct Forest to seek FDA approval of a new drug label. The district court dismissed the complaint, concluding that claims were barred by California’s safe harbor doctrine. The First Circuit affirmed the judgment dismissing the complaint but on other grounds, holding that federal law impliedly preempts Plaintiffs’ claims because the federal Food, Drug, and Cosmetic Act prohibits Forest from independently changing its FDA-approved label to read as Plaintiffs say it should have read in order to comply with California Law. View "Marcus v. Forest Pharms., Inc." on Justia Law

This shareholder derivative suit was one of several suits alleging that Smith & Wesson Holding Corporation, a major gun manufacturer incorporated in Nevada, made misleading public statements in 2007 about demand for its products. In reaction to these cases, Smith & Wesson formed a Special Litigation Committee (SLC) to investigate and evaluate the viability of any of these claims and to make a recommendation to Smith & Wesson’s Board whether to pursue any of these claims. The SLC issued a final report recommending against filing any claims. In 2010, Plaintiff asserted Nevada state law claims against Smith & Wesson’s officers and directors, including breach of fiduciary duty and waste of corporate assets. On the basis of the SLC’s conclusions, Defendants, former and current officers and directors of Smith & Wesson, moved for summary dismissal under Delaware law, as adopted by Nevada. The district court granted the motion. The First Circuit affirmed, holding that the district court did not err in finding as a matter of law that the SLC was independent and that the SLC’s investigation was reasonable and conducted in good faith. View "Sarnacki v. Golden" on Justia Law

This case involved the dispute over settlement agreements between AstraZeneca, which sells a heartburn drug called Nexium, and three generic drug companies that sought to market generic forms of Nexium. The named plaintiffs sued AstraZeneca and the three drug companies, alleging that the settlement agreements constituted unlawful agreements not to compete. Plaintiffs sought class certification for a class of third-party payors and individual consumers. The district court certified a class. Defendants appealed. After briefing, oral argument, and submission of this case, however, Defendants filed a voluntary motion to dismiss the interlocutory appeal. The First Circuit denied the motion to dismiss, holding (1) although some of the underlying issues in this case had been settled and a jury had reached a verdict on some others, the case was not moot; (2) a final draft of the Court’s opinion had already been prepared; and (3) Defendants may have been acting strategically by seeking to dismiss the interlocutory appeal. View "In re Nexium Antitrust Litig." on Justia Law

AstraZeneca, which sells a heartburn drug called Nexium, and three generic drug companies (“generic defendants”) that sought to market generic forms of Nexium, entered into settlement agreements in which the generic defendants agreed not to challenge the validity of the Nexium patents and to delay the launch of their generic products. Certain union health and welfare funds that reimburse plan members for prescription drugs (the named plaintiffs) alleged that the settlement agreements constituted unlawful agreements between Nexium and the generic defendants not to compete. Plaintiffs sought class certification for a class of third-party payors, such as the named plaintiffs, and individual consumers. The district court certified a class. Relevant to this appeal, the class included individual consumers who would have continued to purchase branded Nexium for the same price after generic entry. The First Circuit affirmed the class certification, holding (1) class certification is permissible even if the class includes a de minimis number of uninjured parties; (2) the number of uninjured class members in this case was not significant enough to justify denial of certification; and (3) only injured class members will recover. View "In re Nexium Antitrust Litig." on Justia Law

In this case involving a class action complaint filed against CVS Pharmacy Inc. in Massachusetts Superior Court for wage and hour violations, the First Circuit clarified the removal time periods and mechanisms under the Class Action Fairness Act of 2005. CVS filed a second notice of removal, claiming that there was a reasonable probability that the amount in controversy exceeded $5 million. The district court granted Plaintiffs’ motion to remand, holding (1) CVS’s notice of removal came too late to meet the thirty-day deadline in 28 U.S.C. 1446(b)(1), and the second thirty-day deadline in section 1446(b)(3) did not apply; and (2) CVS had not met its burden to establish the substantive amount in controversy requirement. The First Circuit reversed, holding (1) the time limits in section 1446(b) apply when the plaintiffs’ pleadings or the plaintiffs’ “other papers” provide the defendant with a clear statement of the damages sought or with sufficient facts from which damages can be readily calculated; (2) CVS’s second notice of removal was timely under section 1446(b)(3); and (3) CVS sufficiently demonstrated that the amount in controversy exceeded $5 million. View "Romulus v. CVS Pharmacy, Inc." on Justia Law

Plaintiffs were four customers who purchased cable television, internet, or telephone services from Charter Communications Entertainment I, LLC and Charter Communications, Inc. (together, Charter). After a severe snow storm, Plaintiffs sued Charter on behalf of themselves and a putative class of others claimed to be similarly situated, contending that Charter violated various duties by failing to provide credits to its customers for their loss of service during the storm. Charter removed the case to federal court, invoking the Class Action Fairness Act (Act).. The federal district court subsequently granted Charter’s motion to dismiss, finding that the claims of three Plaintiffs were moot because they had received credits covering the time they were without service and that, as to the fourth plaintiff, the complaint failed to state a claim. The First Circuit vacated in part the district court’s opinion, holding that the district court (1) properly exercised its jurisdiction under the Act; but (2) erred in granting Charter’s motion to dismiss, as all four plaintiffs may pursue their requests for declaratory relief regarding their dispute with Charter over the nature of its obligations to them, and Plaintiffs’ complaint pleaded facts sufficient to plausibly show that they were entitled to relief on some of their claims.View "Cooper v. Charter Cmmc’ns Ents. I, LLC" on Justia Law

At issue in this case was whether alleged misrepresentations made by Defendants were made “in connection with” a transaction in covered securities under the Securities Litigation Uniform Standards Act of 1998 (SLUSA). Plaintiffs, investors in a licensed non-diversified investment company, filed a putative class action in Puerto Rico court against the Fund and others alleging fraud or misrepresentation in violation of Puerto Rico law after the Fund invested the majority of its assets in notes sold by Lehman Brothers, resulting in the Fund adopting a plan of liquidation. Defendants removed the action to the federal district court, asserting that it fell within the ambit of the SLUSA. Plaintiffs unsuccessfully sought remand on jurisdictional grounds. Ultimately, the district court granted Defendants’ motions to dismiss premised on SLUSA preclusion. The First Circuit vacated the judgment of dismissal and remitted with instructions to return the case to the Puerto Rico Court, holding that the link between the misrepresentations alleged and the covered securities in the Fund’s portfolio was too fragile to support a finding of SLUSA preclusion under Chadbourne & Parke LLP v. Troice. View "Hidalgo-Velez v. San Juan Asset Mgmt., Inc." on Justia Law