Articles Posted in Civil Procedure

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The Ninth Circuit reversed the district court's dismissal based on lack of subject matter jurisdiction of an action alleging a claim of legal malpractice. The panel held that what little business Lincoln One conducted was done in Missouri—its state of incorporation—making both Lincoln One and its wholly-owned subsidiary, plaintiff, putative citizens of that state alone. Therefore, there was complete diversity between the parties because defendant was a California citizen. The panel conditionally reversed the district court's jurisdictional dismissal and remanded so that it may consider in the first instance whether Lincoln One and plaintiff were alter egos or there was jurisdictional manipulation that would warrant treating plaintiff as a California citizen. In regard to the issue of classifying the citizenship of a holding company such as Lincoln One that has engaged in no activity other than incorporation, the panel held that a recently-formed holding company's principal place of business is the place where it has its board meetings, regardless of whether such meetings have already occurred, unless evidence shows that the corporation is directed from elsewhere. View "3123 SMB LLC V. Horn" on Justia Law

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The value of the property or amount of indebtedness are not the amounts in controversy when a complaint seeks only a temporary stay of foreclosure pending review of a loan modification application pursuant to the California Homeowners Bill of Rights (HBOR). In this case, the Ninth Circuit held that because SPS did not establish that removal was proper, the district court should have granted Corral's motion to remand and was without subject matter jurisdiction to consider SPS's motion to dismiss for failure to state a claim. Accordingly, the panel reversed the district court's denial of the motion to remand, vacated the order granting SPS's motion to dismiss, and remanded to state court. View "Corral v. Select Portfolio Servicing, Inc." on Justia Law

Posted in: Civil Procedure

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Plaintiffs filed a putative class action alleging that VSI's practices violated state law and the Fair Debt Collection Practices Act. The Ninth Circuit held that it lacked jurisdiction to consider the district court's denial of VSI's motion to strike under California's anti-SLAPP statute, because under the terms of the state statute, such a denial in a case deemed to be filed in the public interest was not immediately appealable. The panel held that it did have jurisdiction over VSI's appeal of the district court's denial of its motion to compel arbitration and affirmed the denial because this was not a private contract subject to the provisions of the Federal Arbitration Act. The panel remanded for further proceedings. View "Breazeale v. Victim Services" on Justia Law

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EZ-FLO manufactures supply lines that connect water pipes to plumbing fixtures. The supply lines consist of flexible tubing on the inside, a protective covering of braided wire on the outside, and plastic nuts on both ends that connect the supply lines to adjacent plumbing. Plaintiffs, insurance companies, alleged that the plastic nuts are defective and allow water to leak out of the supply lines and that they made payments to their insured homeowners for damages caused by the alleged defect. They filed suit as subrogees of those insureds, seeking over $5,000,000 in damages. EZ-FLO filed a notice of removal pursuant to the Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d). The district court held that it lacked jurisdiction because the amended complaint “does not include more than 100 named plaintiffs.” The Ninth Circuit affirmed. A CAFA “mass action” is defined as “any civil action . . . in which monetary relief claims of 100 or more persons are proposed to be tried jointly on the ground that the plaintiffs’ claims involve common questions of law or fact.” A lawsuit filed by 26 insurance companies in their capacity as subrogees of 145 insured homeowners does not qualify as a mass action. View "Liberty Mutual Fire Insurance Co. v. EZ-FLO International, Inc." on Justia Law

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Under New Jersey's traditional res judicata doctrine, a claim asserting breach of a contractual guarantee of a third party's debt does not preclude later alter ego and successor liability claims to collect the debt directly from entities related to the debtor. Further, although New Jersey's procedural joinder rules may require such claims to be joined in a single action, New Jersey law declines to impose these rules on other courts. The Ninth Circuit reversed the district court's dismissal of most of Daewoo's claims as barred by a prior judgment of the United States District Court for the District of New Jersey. In this case, the district court failed to apply New Jersey law correctly and erred in ruling that the claims in the present action were precluded under New Jersey law. View "Daewoo Electronics America v. Opta Corp." on Justia Law

Posted in: Civil Procedure

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Plaintiff, a naturalized U.S. citizen, filed suit against defendants under Bivens v. Six Unknown Named Agents of Fed. Bureau of Narcotics, 403 U.S. 388 (1971), and the Federal Torts Claims Act, 28 U.S.C. 1346(b), after agents erroneously lodged an immigration detainer against him while he was detained in county jail. After the notice of appeal on the Bivens ruling was filed, however, the district court sanctioned plaintiff for egregious misconduct during that discovery and ultimately dismissed his FTCA claims. Defendants then filed a motion in the Ninth Circuit to consider applying the sanction to plaintiff's remaining claims under Federal Rule of Appellate Procedure 12.1(b). The panel held that a limited remand was permissible without first moving in the district court under FRCP 62.1 for a targeted "indicative ruling" and, in this case, a limited remand was appropriate in order for the government to move for dismissal of the remaining claims. View "Mendia v. Garcia" on Justia Law

Posted in: Civil Procedure

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Following Walden v. Fiore, 134 S. Ct. 1115 (2014), the panel held that while a theory of individualized targeting may remain relevant to the minimum contacts inquiry, it will not, on its own, support the exercise of specific jurisdiction, absent compliance with what Walden requires. The Ninth Circuit affirmed the district court's dismissal of a copyright infringement action based on lack of personal jurisdiction over defendant, a United Kingdom limited company. In this case, the panel applied the "effects" test and held that defendant committed an intentional act, but did not expressly aim its intentional act at the forum state. The panel held that the district court properly declined to exercise jurisdiction over defendant pursuant to Federal Rule of Civil Procedure 4(k)(2). View "Axiom Foods, Inc. v. Acerchem Int'l, Inc." on Justia Law

Posted in: Civil Procedure

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Midbrook filed suit seeking recognition of an Amsterdam Court of Appeals judgment under Washington's Uniform Foreign-Country Money Judgments Recognition Act (UFCMJRA). The Ninth Circuit affirmed summary judgment for Midbrook and denied Holland America's discovery request under Federal Rule of Civil Procedure 56(d). The panel held that the commentary and prefatory note to the UFCMJRA demonstrate that under section 4(c)(8), courts ask only whether the party resisting judgment "was denied fundamental fairness in the particular proceedings leading to the foreign-country judgment," not whether the foreign proceedings literally conformed to the requirements of due process under our own Constitution. UFCMJRA 4 cmt. 12. The panel explained that it was not necessary to decide whether process accorded to Midbrook also passed muster under American standards of due process. The panel held that the Dutch courts' treatment of Holland America's discovery requests was a mere "procedural difference" that was insufficient to establish that the Dutch proceedings were fundamentally unfair; Holland America was not denied due process when the Amsterdam Court of Appeal overturned the Alkmaar District Court's factual finding denying the existence of the parties' alleged 1999 settlement agreement; and the district court did not abuse its discretion in denying Holland America's motion for additional discovery. View "Midbrook Flowerbulbs Holland v. Holland America Bulb Farms" on Justia Law

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Plaintiff and his law firm, Morrill & Aronson, filed suit in Arizona district court alleging claims of abuse of process and wrongful institution of civil proceedings. The Ninth Circuit affirmed the district court's dismissal of the action based on no personal jurisdiction over any defendant. In this case, plaintiff and his firm resided, or were located, in Arizona. Defendants were a North Dakota Corporation and its sole shareholder and officer, and a Nevada attorney and law firms. The court held that defendants' actions were not purposefully directed at Arizona, and defendants did not purposefully avail themselves of the benefits of Arizona law. View "Morrill v. Scott Financial Corp." on Justia Law

Posted in: Civil Procedure

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California consumers who can seek in California state court an order requiring the manufacturer of an allegedly falsely advertised product to cease the false advertising may also seek such an order in federal court. A consumer's inability to rely in the future upon a representation made on a package, even if the consumer knew or continued to believe the same representation was false in the past, is an ongoing injury that may justify an order barring the false advertising.The Ninth Circuit reversed the dismissal of an action alleging that Kimberly-Clark falsely advertised that four cleansing wipes they manufactured and sold were flushable. The action was filed in state court and then removed to federal court. The panel held that plaintiff plausibly alleged that Kimberly-Clark engaged in false advertising and that she will suffer further harm in the absence of an injunction. Accordingly, the panel remanded for further proceedings. View "Davidson v. Kimberly-Clark Corp." on Justia Law