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

In this dispute over the handling of brokerage accounts the First Circuit affirmed the judgment of the federal district court dismissing Plaintiffs' complaint against the Financial Industry Regulatory Authority (FINRA) for failure to state a claim, holding that Plaintiffs' complaint failed to state a plausible claim for breach of the covenant of good faith and fair dealing implied under Massachusetts law.Plaintiffs, a married couple, submitted their dispute with their quondam stockbroker over the handling of their brokerage accounts to FINRA for arbitration. A panel of arbitrators summarily dismissed Plaintiffs' claims. Plaintiffs then brought this action claiming that the arbitrators' failure to state an explained decision breached the implied covenant of good faith and fair dealing. The First Circuit affirmed, holding that the district court appropriately dismissed Plaintiffs' complaint because Plaintiffs did not plausibly allege a breach of the implied covenant. View "Lanza v. Financial Industry Regulatory Authority" on Justia Law

In this case arising from a directive issued by the EPA that prohibits EPA grant recipients from sitting on the EPA's twenty-two scientific advisory committees the First Circuit reversed in part the judgment of the district court dismissing the complaint for a lack of justiciability and failure to state a claim, holding that EPA's challenged directive was judicially reviewable under the Administrative Procedure Act (APA), 5 U.S.C. 551 et seq.In 2017, the EPA former director issued the directive. The complaint alleged that the new directive disqualified thousands of scientists affiliated with academic and not-for-profit institutions. Count I alleged that the directive violated the APA's reasoned decision-making standard. Count II alleged that the directive conflicted with directives issued by the General Services Administration and regulations of the Office of Governmental Ethics. Counts III and IV alleged violations of the Federal Advisory Committee Act's requirements for advisory committees. The district court dismissed all counts, concluding that they raised questions unreviewable under the APA and, alternatively, that the first and second counts failed to state a claim on the merits. The First Circuit reversed the district court's decision on Counts III and IV, holding that the challenged directive was judicially reviewable under the APA. View "Union of Concerned Scientists v. United States Environmental Protection Agency" on Justia Law

Given the fundamental change in the facts of this case since the appeal was first filed and briefed the First Circuit remanded this action to the district court for reconsideration of its ruling dismissing the claims as unripe.In 2017, two groups of health centers filed adversary complaints in the Financial Oversight and Management Board's Title III case seeking a declaration that their claims against the Commonwealth seeking to collect payments under federal Medicaid law were non-dischargeable under PROMESA and that those claims may not otherwise be impaired in any matter. The magistrate judge recommended that the complaints be dismissed without prejudice as unripe. The district court held that Appellants' requests for declaratory relief were not ripe for review because there was no evidence that the Commonwealth would seek to discharge or impair their claims through the Title III proceeding. After the health centers appealed and the appeal was briefed, circumstances materially changed because the Commonwealth filed an amended proposed plan of adjustment. The First Circuit remanded the case to the district court for reconsideration of its ripeness ruling in light of the changed circumstances and any other matters the court deemed relevant. View "Corporacion de Servicios v. Commonwealth of Puerto Rico" on Justia Law

In this insurance dispute, the First Circuit affirmed the judgment of the district court granting summary judgment in favor of Defendants and dismissing Plaintiff's suit to recover unreimbursed defense costs that a former investment advisory firm (Firm) incurred in connection with a Securities and Exchange Commission (SEC) investigation of the Firm, holding that the Firm was not entitled to coverage.Plaintiff, in his capacity as trustee of a trust established during the bankruptcy proceedings of the Firm, filed this suit against Defendants, two of the Firm's excess insurers, seeking to recover defense costs that the Firm incurred in connection with the SEC investigation. The district court granted summary judgment for Defendants, concluding that an SEC order issued before the start of Defendants' coverage period initiated the investigation of the Firm, and this order triggered the policy's "deemed-made" clause, meaning that the claim was deemed first made prior to Defendants' policy taking effect. The First Circuit affirmed, holding (1) the SEC investigation was a claim that was deemed to have been made when the SEC order issued prior to the inception of Defendants' policies; and (2) accordingly and the claim was outside of the policies' coverage period, and Defendants were not obligated to reimburse the Firm for its defense costs. View "Jalbert v. Zurich Services Corp." on Justia Law

The First Circuit affirmed the judgment of the district court denying Defendant's motion for a new trial, in which Defendant sought to vacate seventeen convictions that he received and that resulted from two separate trials, holding that the district court did not err in denying Defendant's motion for a new trial.Following the verdicts in his second trial, Defendant filed a motion for a new trial, alleging that he had received ineffective assistance of counsel at his first trial and that the district court erred in denying his motion in limine to preclude guilty verdicts in the first trial from being used to impeach him at his second trial. The district court treated the motion as challenging not only the nine counts for which Defendant had been found guilty in the second trial but also the eight counts for which he had been found guilty in the first trial but for which no judgment of conviction had yet been entered. The district court denied the motion for a new trial. The Supreme Court affirmed, holding that Defendant was not entitled to relief as to any of his arguments. View "United States v. Silvia" on Justia Law

The First Circuit affirmed the decisions of the district court ordering the return of A.C.A., the child that Mother "wrongfully removed" from Brazil, holding that the district court did not err in finding that the two affirmative defenses to return under the Hague Convention on the Civil Aspects of International Child Abduction did not apply and did not abuse its discretion in denying Appellant's motion for a new trial.Without Father's consent or knowledge, Mother took A.C.A. from Brazil, where the parties lived, to the United States. Father filed a Hague Convention petition seeking the return of A.C.A. to Brazil. The district court concluded that Mother had wrongfully removed A.C.A. from Brazil and ordered that A.C.A. be returned to Brazil. Mother moved for a new trial, which the district court denied. The First Circuit affirmed, holding (1) the district court did not err in concluding that Mother had not met her burden of proof as to any of her defenses; and (2) the district court did not abuse its discretion in denying Mother's motion for a new trial. View "da Silva v. de Aredes" on Justia Law

The First Circuit held that the special measure of constitutional protection to which police officers, in the motor vehicle context, performing community care taking functions are entitled extends to police officers performing community caretaking functions on private premises, including homes.Plaintiff's person and firearms were allegedly seized after Defendants, police officers, entered his home. Plaintiff brought several claims against Defendants, including claims brought under 42 U.S.C. 1983 and under state law. The district court granted summary judgment in favor of Defendants on Plaintiff's federal and state-law claims, concluding that the officers' conduct at Plaintiff's residence constituted a reasonable exercise of their caretaking responsibilities and thus did not violate Plaintiff's Fourth Amendment rights. The First Circuit affirmed, holding that Defendants' actions did not exceed the proper province of their community caretaking responsibilities. View "Caniglia v. Strom" on Justia Law

The First Circuit affirmed the district court's grant of summary judgment in favor of Orgill, Inc. in this case alleging copyright infringement claims, holding that a copyright licensee given the unrestricted right to grant sublicenses may do so without using express language.Orgill markets and sells Sylvania lightbulbs. At issue was Orgill's use of Photographic Illustrators Corporation (PIC) photos of Sylvania lightbulbs in Orgill's electronic and paper catalogs. PIC and Sylvania had negotiated a license setting forth the scope of Sylvania's permission to use PIC's photographs of Sylvania lightbulbs, but Sylvania did not tell Orgill that Orgill needed to abide by an attribution restriction in Sylvania's license. PIC sued Orgill and other Sylvania dealers and distributors claiming copyright infringement. The district court determined that Orgill had a sublicense from Sylvania to use the photos and rejected PIC's argument that sublicensee of copyrights are ineffective absent language expressly granting permission to use the copyrighted work. The First Circuit affirmed, holding (1) where a licensor grants to a licensee the unrestricted right to sublicense and permit others to use a copyrighted work, a sublicense may be implied by the conduct of the sublicensor and sublicensee; and (2) a reasonable jury could have found that Sylvania granted an implied sublicense to Orgill. View "Photographic Illustrators Corp. v. Orgill, Inc." on Justia Law

In this appeal concerning whether a settlement contract under Rhode Island law was formed after a personal injury lawsuit was filed the First Circuit certified to the Rhode Island Supreme Court the question of what is the definition of 'civil action' in R.I. Gen. Laws 27-7-2.2.Horace Johnson was the driver and Carlton Johnson was the sole passenger in a car accident. The accident occurred in Rhode Island. Both men were seriously injured. Horace was insured by Arbella Mutual Insurance Company. Arbella accepted Carlton's demand to settle for the policy limit of $100,000. Thereafter, Carlton filed a lawsuit against Horace, Arbella, and other defendants. A federal district court granted summary judgment for Defendants. The district court rejected Carlton's argument that Rhode Island's Rejected Settlement Offer Interest Statute, section 27-7-2.2, applied to the case. Carlton appealed, arguing that the statute rendered the settlement contract unenforceable because Arbella failed to accept his settlement offer within the timetable set forth by the statute. At issue was whether the court correctly determined that the statute's "[i]n any civil action" language requires that a legal proceeding in court needs to be underway to trigger the statute's application. The First Circuit certified to the Rhode Island Supreme Court a question concerning the definition of "civil action." View "Johnson v. Johnson" on Justia Law

In this case arising out of a petition for bankruptcy filed by the Montreal Maine & Atlantic Railway (MMA) the First Circuit affirmed the decision of the Bankruptcy Appellate Panel (BAP) upholding the judgment of the bankruptcy court ruling that certain claims filed by creditor railroads should be given priority status pursuant to 11 U.S.C. 1171(b) because they were "Six Months Rule" claims, holding that the claims at issue were priority claims under section 1171(b).In their claims, the creditor railroads sought to recover their share of payments that the MMA was to collect for charges that had been billed to customers that had shipped freight on routes that covered rail systems owned by the MMA and the creditor railroads. The creditor railroads argued that their claims qualified as Six Months Rule claims and so must be paid in full before other claims because the MMA incurred the debt for their share of these payments so close in time to the MMA's bankruptcy. The bankruptcy court agreed with the creditor railroads and concluded that the claims were entitled to priority under section 1171(b). The BAP affirmed. The First Circuit affirmed, holding that the claims were priority claims under the statute. View "Keach v. New Brunswick Southern Railway Co. Ltd." on Justia Law