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

Plaintiffs appealed the district court’s dismissal of their claims against Rio Properties, LLC (“Rio”), which owns and operates the Rio All-Suite Hotel and Casino in Las Vegas, Nevada. During this time, Plaintiffs claim Defendant knew that its water system was infected with Legionella bacteria, which causes Legionnaires’ Disease. After learning of the contamination, Plaintiffs brought a putative class action against Defendant. They sought the return of the resort fee on the theory that they would not have gone to the hotel, and would not have paid the resort fee if Defendant had told them about the presence of the Legionella.   In a prior decision, the Ninth Circuit affirmed the dismissal of Plaintiffs’ claims for negligence, “declaratory relief,” violation of Nevada Revised Statutes (“NRS”) Section 205.377(1), and consumer fraud, and reversed the dismissal of Plaintiffs’ unjust enrichment claim. However, the court reserved judgment on Plaintiffs’ claims for fraudulent concealment and statutory consumer fraud, based on NRS Section 598.0923(2), because a controlling question of state law existed.   In response to a certified question, the Nevada State Supreme Court answered “that a plaintiff who receives the true value of the goods or services purchased has not suffered damages under theories of common-law fraudulent concealment or N.R.S. 41.600.”  Thus, the Ninth Circuit affirmed, finding that applying Nevada state law as declared by the Nevada State Supreme Court, Plaintiffs failed to allege recoverable damages as to their fraudulent concealment and consumer fraud claims. View "AARON LEIGH-PINK V. RIO PROPERTIES, LLC" on Justia Law

Plaintiff American Savings Bank, F.S.B (“ASB”) sent text messages to his mobile phone without the consent required by the Telephone Consumer Protection Act (“TCPA”). Affirming the district court’s summary judgment, the Ninth Circuit held that under Van Patten v. Vertical Fitness Grp., LLC, 847 F.3d 1037 (9th Cir. 2017), messages sent by Plaintiff’s phone to ASB’s “short code” number provided the required prior express consent for ASB’s responsive messages.   The district court granted ASB’s motion for an award of costs under Rule 41(d) for costs, including attorney’s fees, that ASB incurred in defending identical litigation commenced and later voluntarily dismissed by Plaintiff in the District of Connecticut. Joining other circuits, and reversing in part, the court held that Rule 41(d) “costs” do not include attorney’s fees as a matter of right. Accordingly, the district court abused its discretion in including attorney’s fees in its award of costs under Rule 41(d).   The court explained that it did not decide if bad faith is sufficient to allow a party to recover attorney’s fees as “costs” under Rule 41(b), as bad faith was not alleged, much less proven, by ASB in the district court. The court did not address whether attorney’s fees are available under Rule 41(b) if the underlying statute so provides because, here, it was undisputed that the TCPA does not provide for the award of attorney’s fees to the prevailing party. View "CRAIG MOSKOWITZ V. AMERICAN SAVINGS BANK" on Justia Law

The Ninth Circuit reversed the district court’s grant of summary judgment to federal defendants in a Freedom of Information Act (“FOIA”) action brought by Inter-Cooperative Exchange (“ICE”), a cooperative of fishers who harvest and deliver crab off the coast of Alaska, seeking the government’s communications concerning the government’s decision not to factor Alaska’s minimum wage increase into the arbitration system that sets the price of crab.   The North Pacific Fishery Management Council manages fisheries off the coast of Alaska. In 2005, the National Marine Fisheries Service (“NMFS”) implemented a program recommended by the Council to allocate crab resources among harvesters, processors, and coastal communities. Alaska increased the minimum wage, which raised the question of whether costs should be considered under the arbitration system. The Council reviewed the matter at a 2017 meeting where an Assistant Regional Administrator of NMFS and a voting member of the Council, introduced an unsuccessful motion to include costs for consideration in the arbitration system.   The court held that on the facts here, the three search terms were not reasonably calculated to uncover all documents relevant to ICE’s request. ICE contended that the government’s choice of search terms was unduly narrow and not reasonably calculated to uncover all documents relevant to its FOIA request. The court held that the government’s choice of search terms was overly narrow. View "INTER-COOPERATIVE EXCHANGE V. USDOC" on Justia Law

CashCall made unsecured, high-interest loans to consumers throughout the country, and sought to avoid state usury and licensing laws by using an entity operating on an Indian reservation. The entity issued loan agreements that contained a choice-of-law provision calling for the application of tribal law. The Consumer Financial Protection Bureau brought an action alleging that the scheme was an “unfair, deceptive, or abusive act or abusive practice.” 12 U.S.C. Section 5536(a)(1)(B). The district court held that CashCall violated the Consumer Financial Protection Act (“CFPA”).   The court first considered whether the Bureau lacked authority to bring this action because it was unconstitutionally structured. The court found despite the unconstitutional limitation on the President’s authority to remove the Bureau’s Director, the Director’s actions were valid when they were taken. Both the complaint and the notice of appeal were filed while the Bureau was headed by a lawfully appointed Director. The court declined to consider CashCall’s new theory that the Bureau’s structure violated the Appropriations Clause of the Constitution.   Next, the court held that the Tribe had no substantial relationship to the transactions, and because there was no other reasonable basis for the parties’ choice of tribal law, the district court correctly declined to give effect to the choice-of-law provision in the loan agreements. The court concluded that from September 2013, the danger that CashCall’s conduct violated the CFPA was so obvious that CashCall must have been aware of it. The court vacated the civil penalty and remanded with instructions that the district court reassess it. View "CFPB V. CASHCALL, INC." on Justia Law

CitiMortgage, Inc. (“CitiMortgage”) erroneously reported that Plaintiff owed a debt that had been “abolished” under Arizona law. After Plaintiff disputed the entry, CitiMortgage continued to report late payments on the debt and mounting interest and late fees.   The Ninth Circuit reversed the district court’s summary judgment in favor of CitiMortgage in Plaintiff’s action alleging that CitiMortgage violated the Fair Credit Reporting Act (FCRA), 15 U.S.C. Sections 1681, et seq., by failing to reasonably investigate Plaintiff's dispute concerning a debt that CitiMortgage reported to national credit reporting agencies and by providing inaccurate information to those agencies. The court held that Plaintiff has more than satisfied his burden to make a prima facie showing of inaccurate reporting by establishing as a matter of law that CitiMortgage’s reports were “patently incorrect.” The court further explained that the question is not whether the junior mortgage was entirely “extinguished” by Arizona law, or whether the debt continued to exist; the point is that vis-à-vis Plaintiff, no outstanding balance existed, because the statute abolished his personal liability.The court held that there is a genuine factual dispute about the reasonableness of CitiMortgage’s investigation, and thus left it to the jury to determine the reasonableness. The court wrote that the issue of causation is quintessentially one for the jury and not for this court to decide on appeal. View "MARSHALL GROSS V. CITIMORTGAGE, INC." on Justia Law

Plaintiff bought garments from Eddie Bauer Outlet Stores advertising sales of 40–70% off. The price tags of the garments included two numbers: a higher price, which the parties call a “reference” or “list price,” and a lower “sale” price. Plaintiff paid the “sale” price for the clothes. She alleges that she relied on the representation that she was getting the clothes on sale, but later discovered that the “list prices” were misleading because Eddie Bauer never sold the garments for the “list price” and that the Eddie Bauer Outlet Stores have perpetual sales of 40–70% off.The court concluded that the disposition of this appeal turns on a question of Oregon law: whether a consumer suffers an “ascertainable loss” under Or. Rev. Stat. Sec. 646.638(1) when the consumer purchased a product that the consumer would not have purchased at the price that the consumer paid but for a violation of Or. Rev. Stat. Secs. 646.608(1)(e), (i), (j), (ee), or (u), if the violation arises from a representation regarding the product’s price, comparative price, or price history, but not about the character or quality of the product itself. View "SUSAN CLARK V. EDDIE BAUER LLC" on Justia Law

Plaintiff filed a class action against air conditioner manufacturer Carrier Corporation alleging that his air conditioner was defective, asserting state law claims and a federal Magnuson-Moss Warranty Act ("MMWA") claim. The court reasoned that although the MMWA is a federal statute, federal courts do not have jurisdiction over an MMWA claim if the amount in controversy is less than $50,000. At issue is whether attorneys’ fees count toward the MMWA’s amount in controversy requirement.The panel held that attorneys’ fees are not “costs” within the meaning of MMWA, and therefore they may be included in the amount in controversy if they are available to prevail plaintiffs pursuant to state fee-shifting statutes.The panel next considered whether Plaintiff could include attorneys’ fees toward the MMWA’s $50,000 jurisdictional threshold. Plaintiff’s MMWA claim was premised on Carrier’s alleged breach of express and implied warranties pursuant to Michigan law. Neither of these statutes grants a prevailing plaintiff attorneys’ fees. The court found that even if this claim was included in his lawsuit, the Act makes clear that attorneys’ fees are not available in a class action. Thus, because Plaintiff brought this claim as part of a putative class action, he is not entitled to attorneys’ fees under state law. View "NICHOLAS SHONER V. CARRIER CORPORATION" on Justia Law

CalChamber filed suit, 42 U.S.C. 1983, to “vindicate its members’ First Amendment rights to not be compelled to place false and misleading acrylamide warnings on their food products.” The district court entered a preliminary injunction, prohibiting the Attorney General and related entities, including private enforcers from pursuing new lawsuits to enforce Proposition 65's requirement that “[n]o person in the course of doing business shall knowingly and intentionally expose any individual to a chemical known to the state to cause cancer . . . without first giving clear and reasonable warning.”The Ninth Circuit affirmed. CalChamber was likely to succeed on the merits of its compelled speech claim. Given the robust disagreement by reputable scientific sources over whether acrylamide in food causes cancer in humans, the warning was controversial and misleading. Proposition 65’s enforcement regime created a heavy litigation burden on manufacturers who use alternative warnings rather than the regulatory safe harbor warning. The serious constitutional issue provided sufficient reason to enjoin Proposition 65 acrylamide litigation until the case was finally decided; the injunction was not an impermissible prior restraint. CalChambers established irreparable harm, and the scope of the injunction was not impermissible; and the balance of hardships weighed in CalChamber’s favor. The injunction was in the public interest. View "California Chamber of Commerce v. Council for Education and Research on Toxics" on Justia Law

Food manufacturer B&G sued, 42 U.S.C. 1983, alleging that Embry and her attorney violated B&G’s constitutional rights by suing B&G to enforce California’s Safe Drinking Water and Toxic Enforcement Act of 1986, Proposition 65. Proposition 65 requires businesses to notify customers if their products contain chemicals known to the state to cause cancer. Acrylamide, the chemical allegedly found in B&G’s Cookie Cakes, is on a state list of such chemicals based solely on laboratory studies in which pure acrylamide was given to rats or mice.The district court dismissed B&G’s complaint based on the Noerr-Pennington doctrine, which provides that those who petition any department of the government for redress are generally immune from statutory liability for their petitioning conduct. The Ninth Circuit affirmed. B&G’s section 1983 suit burdened Embry's petition activities; Embry's prelitigation communications and suit to enforce Proposition 65 were protected by the Petition Clause. B&G failed to show that any of the Noerr-Pennington sham exceptions applied. Even if Embry and her attorney were state actors, the suit was barred. The court remanded to allow B&G to amend its complaint. B&G proposed additional allegations concerning a sham exception that examines the objective reasonableness of a defendant’s suit and the defendant’s subjective motivation. View "B&G Foods North America, Inc. v. Embry" on Justia Law

The Ninth Circuit affirmed the district court's denial of plaintiffs' motion for a remand to state court and the district court's dismissal of plaintiffs' class action suit alleging violations of the Fair Credit Reporting Act (FCRA) by Experian. Plaintiffs alleged that the FCRA required Experian to disclose behavioral data from its "ConsumerView" marketing database, "soft inquiries" from third parties and affiliates, the identity of certain parties who procured consumer reports, and the date on which employment data was reported.The panel concluded that the allegations of injury to plaintiffs' informational and privacy interests as recited in the first amended complaint are sufficiently concrete to support Article III standing at this pleading stage. The panel also concluded that none of the information plaintiffs contend Experian failed to include in its section 1681g of the FCRA disclosures is subject to disclosure under section 1681g(a)(1), (3) or (5), considered individually or in combination. View "Tailford v. Experian Information Solutions, Inc." on Justia Law