Justia U.S. 9th Circuit Court of Appeals Opinion Summaries

Several individuals alleged that Google collected and misused the private browsing data of Chrome users who utilized Incognito mode, despite Google’s representations about the privacy of this feature. In June 2020, five plaintiffs brought a putative class action on behalf of these users, seeking both injunctive relief and damages. After extensive discovery, the United States District Court for the Northern District of California certified a class for injunctive relief but denied certification for a damages class, finding the plaintiffs had not shown that common issues predominated over individual ones.Following the denial of damages class certification, the named plaintiffs sought review in the United States Court of Appeals for the Ninth Circuit under Rule 23(f), but the petition was denied. The case proceeded, and as trial approached, the parties settled: Google agreed to change its policies, the named plaintiffs would arbitrate their individual damages claims, and they waived their rights to appeal the denial of damages class certification. The settlement explicitly stated that absent class members were not releasing damages claims or appellate rights. Several months after the settlement, a group of 185 Chrome users, referred to as the Salcido plaintiffs, moved to intervene to preserve absent class members’ appellate rights regarding damages.The United States Court of Appeals for the Ninth Circuit reviewed the district court’s denial of the intervention motion. The Ninth Circuit held that the district court did not abuse its discretion in finding the intervention motion untimely. Applying the circuit’s traditional three-part test for intervention—considering the stage of the proceedings, prejudice to other parties, and the reason for and length of delay—the court found that intervention at this late stage would prejudice the existing parties, that the delay was unjustified, and that the timing weighed against intervention. The denial of the motion to intervene was therefore affirmed. View "BROWN V. SALCIDO" on Justia Law

A consumer purchased a set of bed sheets from a major retailer, choosing a more expensive option because the packaging stated the sheets were made of “100% cotton” and had an “800 Thread Count.” After using the sheets, he believed the quality did not match the advertised thread count. He later had the sheets tested by an expert, who determined the actual thread count was much lower. The consumer alleged that it is physically impossible for 100% cotton fabric to reach the advertised thread counts and claimed that the retailer’s labeling was false and misleading.The consumer initially brought a class action in California state court, alleging violations of California’s Unfair Competition Law and Consumer Legal Remedies Act. The retailer removed the suit to the United States District Court for the Southern District of California. The retailer moved to dismiss the complaint, arguing that the consumer failed to adequately plead his claims and that the impossibility of the claimed thread count meant no reasonable consumer would be misled. The district court agreed and dismissed the case with prejudice, relying on the Ninth Circuit’s decision in Moore v. Trader Joe’s Co., interpreting it to mean that literally impossible claims cannot deceive reasonable consumers as a matter of law.The United States Court of Appeals for the Ninth Circuit reviewed the dismissal de novo. The court held that the district court erred in its interpretation of Moore. The appellate court clarified that claims of literal falsity are actionable under California consumer protection laws and that even physically impossible claims may deceive reasonable consumers. The court reversed the district court’s dismissal and remanded the case for further proceedings, holding that the consumer’s allegations were sufficient to survive a motion to dismiss. View "PANELLI V. TARGET CORPORATION" on Justia Law

The plaintiff entered into a lease agreement with a car dealership to lease a Jeep Grand Cherokee. The lease included an arbitration agreement containing a delegation clause, which specified that disputes about the scope of the arbitration agreement would be decided in arbitration. Later, the plaintiff filed a federal class action lawsuit against the vehicle’s manufacturer, alleging defects in the headrest. The manufacturer, however, was not a party to the lease agreement and did not claim to be an employee, agent, successor, or assign of the dealership.After the lawsuit was filed in the United States District Court for the Eastern District of California, the manufacturer moved to compel arbitration, arguing that the delegation clause required an arbitrator—not the court—to decide whether the manufacturer could enforce the arbitration agreement. In the alternative, the manufacturer asserted that either the plain language of the agreement or the doctrine of equitable estoppel entitled it to compel arbitration. The district court denied the motion, finding that the manufacturer could not enforce the arbitration agreement because it was not a party to the contract and none of the exceptions allowing enforcement by a non-signatory applied.The United States Court of Appeals for the Ninth Circuit reviewed the case and affirmed the district court’s denial of the motion to compel arbitration. The appellate court held that, absent a relevant exception, a non-party to an arbitration agreement cannot enforce the agreement’s terms against a signatory. It found that the language of the arbitration agreement did not cover disputes with the manufacturer, and under California law, the manufacturer could not use equitable estoppel to compel arbitration because the plaintiff’s claims were not founded in or intertwined with the lease agreement. The court’s disposition was to affirm the district court’s order. View "OLSON V. FCA US, LLC" on Justia Law

Former employees of a travel-nursing agency brought a putative class action against the agency, alleging wage-related violations. Each employee had signed an arbitration agreement with the agency that contained a delegation clause requiring an arbitrator—not a court—to decide on the validity of the agreement. Four initial plaintiffs had their disputes sent to arbitration: two arbitrators found the agreements valid, while two found them invalid due to unconscionable fee and venue provisions.After these initial arbitrations, the United States District Court for the Southern District of California confirmed three out of four arbitral awards. At this stage, an additional 255 employees joined the action as opt-in plaintiffs under the Fair Labor Standards Act. The agency moved to compel arbitration for these additional plaintiffs under their individual agreements. However, a different district judge raised the issue of whether non-mutual offensive collateral estoppel barred the enforcement of the arbitration agreements. After briefing, the district court denied the agency’s motion, concluding that the two arbitral awards finding the agreements invalid precluded arbitration for all 255 employees, effectively rendering their agreements unenforceable.On appeal, the United States Court of Appeals for the Ninth Circuit reversed the district court’s judgment. The Ninth Circuit held that the application of non-mutual offensive collateral estoppel to preclude the enforcement of arbitration agreements is incompatible with the Federal Arbitration Act (FAA). The court reasoned that such an approach undermined the principle of individualized arbitration and the parties’ consent, which are fundamental to the FAA. The Ninth Circuit concluded that the FAA does not permit using non-mutual offensive collateral estoppel to invalidate arbitration agreements and remanded the case for further proceedings. View "O'DELL V. AYA HEALTHCARE SERVICES, INC." on Justia Law

A group of former and current employees of a staffing agency alleged that the company misclassified recruiters as exempt from state overtime laws and failed to provide required meal and rest breaks. After the employees filed a putative class action in state court, which the company removed to federal court, the parties engaged in over a year of discovery and completed class certification briefing. Shortly after class certification briefing closed, the company implemented a new, mandatory arbitration agreement for internal employees, including the putative class members. This agreement required class members to either quit their jobs or affirmatively opt out of arbitration if they wished to remain in the class, effectively reversing the typical opt-out structure of class actions under Federal Rule of Civil Procedure 23.The United States District Court for the Northern District of California granted class certification and, after reviewing the company’s communications about the new arbitration agreement, found them misleading and potentially coercive. The court determined that the communications disparaged class actions, omitted key information, and confused recipients about their rights and deadlines, especially as the emails were sent during a holiday period. Consequently, when the company moved to compel arbitration against class members who had not opted out, the district court denied the motion, relying on its authority under FRCP 23(d) to ensure the fairness of class proceedings.On appeal, the United States Court of Appeals for the Ninth Circuit affirmed the district court’s decision. The Ninth Circuit held that district courts have broad authority under FRCP 23(d) to refuse to enforce arbitration agreements when a defendant’s conduct undermines the fairness of the class action process, especially where communications are misleading and subvert the opt-out mechanism. The court also held that the arbitration agreement’s delegation provision did not prevent the district court from ruling on enforceability in this context. View "AVERY V. TEKSYSTEMS, INC." on Justia Law

The case involves an Arizona resident who received an unsolicited text message on his cell phone during the 2020 presidential election campaign. The message, sent by the Republican National Committee, included written text and an automatically downloaded video file featuring a still image of Ivanka Trump with a play button overlay. The plaintiff alleged the video contained an artificial or prerecorded voice and stated he never gave prior express consent to receive such messages. He claimed the message was part of a broader campaign targeting Arizona residents.In the United States District Court for the District of Arizona, the plaintiff filed a putative class action, alleging violations of two provisions of the Telephone Consumer Protection Act (TCPA): 47 U.S.C. § 227(b)(1)(A)(iii) and § 227(b)(1)(B), both prohibiting calls using an artificial or prerecorded voice without prior consent. The district court dismissed the complaint with prejudice under Rule 12(b)(6), holding that the statute did not apply because the recipient had to actively press play to hear the video’s audio, and, for the § 227(b)(1)(B) claim, because the message was exempted under FCC regulations for certain nonprofit organizations.On appeal, the United States Court of Appeals for the Ninth Circuit affirmed the district court’s dismissal. The Ninth Circuit held that the TCPA’s prohibitions apply only to the use of artificial or prerecorded voices in the manner in which a call is begun. Because the text message was made and initiated without the automatic playing of a prerecorded voice—the recipient had to affirmatively choose to play the video—the conduct did not violate the statutory provisions. The court concluded that sending a text message containing a video file that requires recipient interaction to play does not constitute “making” or “initiating” a call “using” a prerecorded voice under the TCPA. View "HOWARD V. REPUBLICAN NATIONAL COMMITTEE" on Justia Law

Milliman, Inc. operates a service that compiles consumer medical and prescription reports, which are then sold to insurers for underwriting decisions. The named plaintiff, James Healy, applied for life insurance, but Milliman provided a report to the insurer containing another person's medical records and social security number. This erroneous report flagged Healy as high risk for several serious medical conditions he did not actually have, resulting in the denial of his insurance application. Healy attempted to correct the report, but Milliman did not timely investigate or remedy the errors.Healy filed a class action in the United States District Court for the Western District of Washington, alleging that Milliman’s procedures violated the Fair Credit Reporting Act by failing to ensure maximum possible accuracy. The district court certified an “inaccuracy class” for those whose reports included mismatched social security numbers and risk flags. Milliman moved for partial summary judgment, arguing that Healy needed to show class-wide standing at this stage. The district court agreed, finding under TransUnion LLC v. Ramirez, 594 U.S. 413 (2021), that Healy had failed to present direct evidence of concrete injury on a class-wide basis, and dismissed the inaccuracy class.On interlocutory appeal, the United States Court of Appeals for the Ninth Circuit held that, following class certification in damages actions, both named and unnamed class members must present evidence of standing at summary judgment. However, the court clarified that plaintiffs may rely on either direct or circumstantial evidence, and need only show that a rational trier of fact could infer standing, not that standing is conclusively established. The panel reversed the district court’s partial summary judgment and remanded for reconsideration under the correct summary judgment standard. View "HEALY V. MILLIMAN, INC." on Justia Law

A group of 169 individuals who worked at the Clark County Government Center in Las Vegas brought claims alleging that they suffered serious injuries due to exposure to toxic chemicals, including polychlorinated biphenyls (PCBs), at their workplace. The site of the Government Center had previously been used as a rail yard by Union Pacific Railroad, and plaintiffs alleged that Union Pacific dumped waste, including PCBs manufactured by the former Monsanto Company, at the site. Plaintiffs asserted that Monsanto’s corporate successors inherited liability for harms caused by the production, sale, and distribution of PCBs, which allegedly caused a range of health issues for those exposed.The plaintiffs initially filed suit in Nevada state court against multiple defendants, including Union Pacific, the Las Vegas Downtown Redevelopment Agency, and Monsanto’s successors. The claims sought compensatory and punitive damages for injuries stemming from the alleged contamination. Monsanto’s successors removed the action to the United States District Court for the District of Nevada under the Class Action Fairness Act (CAFA). The plaintiffs moved to remand the case back to state court, and the District Court granted the motion, finding that the local controversy exception to CAFA applied since the alleged injuries were localized to Clark County.On appeal, the United States Court of Appeals for the Ninth Circuit reviewed the district court’s remand order de novo. The Ninth Circuit held that CAFA’s local controversy exception did not apply because the principal injuries resulting from Monsanto’s conduct were not shown to have been incurred primarily in Nevada. The court found that plaintiffs’ allegations described nationwide distribution and harm from PCBs, with no facts indicating that Nevada experienced principal or unique injuries. Therefore, the Ninth Circuit reversed the District Court’s order remanding the case and ordered the case to proceed in federal court. View "EMPLOYEES AT THE CLARK COUNTY GOVERNMENT CENTER V. MONSANTO COMPANY" on Justia Law

The plaintiff held a variable-rate credit card issued by a bank, with an agreement specifying that the interest rate for each billing cycle would be determined by adding a constant margin to the U.S. Prime Rate as published in The Wall Street Journal on the last day of each month. When the Federal Reserve increased the Federal Funds Rate multiple times from March 2022 to July 2023, the Prime Rate—and consequently, the plaintiff’s credit card interest rate—increased significantly. The new, higher rate was applied to the cardholder’s outstanding balances for the entire billing cycle, including balances incurred before the Prime Rate increased. The plaintiff, dissatisfied with paying higher interest on previous balances, filed a class action alleging that the bank’s method of calculating and applying the interest rate violated the Credit Card Accountability Responsibility and Disclosure Act of 2009 (CARD Act) and California’s Unfair Competition Law.The United States District Court for the Northern District of California dismissed the case under Rule 12(b)(6), concluding that the bank’s method fell within a statutory exception in the CARD Act. The court found that the credit card agreement’s use of the Prime Rate, which is publicly available and not controlled by the bank, satisfied the CARD Act’s exception for variable rates tied to an external index.On appeal, the United States Court of Appeals for the Ninth Circuit reviewed the dismissal de novo. The appellate court held that the agreement complied with 15 U.S.C. § 1666i-1(b)(2), as the only variable affecting the rate was the Prime Rate, which was not under the bank’s control. The court found no violation of the CARD Act and affirmed the district court’s dismissal, holding that the bank’s method of setting variable rates according to the Prime Rate was lawful under the statute’s exception. View "MILLIKEN V. BANK OF AMERICA, N.A." on Justia Law

A group of unhoused veterans with severe disabilities and mental illnesses sued the United States Department of Veterans Affairs (VA) and the Department of Housing and Urban Development (HUD), seeking to restore the West Los Angeles VA Grounds for its intended use: housing disabled veterans. The VA had leased portions of this land to third parties—including the Regents of the University of California, Brentwood School, and Bridgeland Resources LLC—for uses that did not principally benefit veterans. Plaintiffs argued that the lack of supportive housing denied meaningful access to VA healthcare, violated the Rehabilitation Act, and placed them at serious risk of institutionalization. They also challenged VA policies that counted disability benefits as income, restricting access to supportive housing, and claimed that certain land-use agreements violated the Administrative Procedures Act (APA). Additionally, they asserted that the original 1888 Deed created a charitable trust that the VA had breached.The United States District Court for the Central District of California held a four-week bench trial, finding that the VA’s land-use leases with UCLA, Brentwood School, and Bridgeland Resources LLC were unlawful, voided these leases, and enjoined the VA from renegotiating them. The court certified a plaintiff class, ordered the VA to build supportive housing, found the VA and HUD violated the Rehabilitation Act in several respects, and determined that the VA had breached fiduciary duties under a charitable trust theory, invalidating certain leases on that basis as well.On review, the United States Court of Appeals for the Ninth Circuit affirmed in part, reversed in part, vacated in part, and remanded. The Ninth Circuit held that federal courts retained jurisdiction over plaintiffs’ Rehabilitation Act claims, upheld class certification, and affirmed findings of meaningful access, Olmstead, and facial discrimination under the Rehabilitation Act against the VA. The court reversed judgment against HUD, and also reversed the charitable trust claim, finding no judicially enforceable fiduciary duties under the Leasing Act. The court vacated related injunctive relief and judgments based on the charitable trust theory, including those against UCLA, Brentwood, and Bridgeland. The injunctions were modified, allowing the VA to renegotiate leases if compliant with statutory requirements. View "Powers v. McDonough" on Justia Law