February 2016 Federal Civil Practice Newsletter

Plaintiff filed a putative class action against the Army and Air Force Exchange Service in Illinois state court, alleging that the exchange printed her credit card’s expiration date on purchase receipts in violation of the Fair and Accurate Credit Transactions Act and the exchange removed the case to federal court. In federal court, the plaintiff moved to remand and the defendant moved to dismiss with both parties focused on plaintiff’s lack of Article III standing. The district court dismissed the lawsuit, reasoning that the defendant did not need to assert a colorable defense to remove the action and that it had an absolute right to litigate in federal court. The Seventh Circuit agreed that defendant was not required to present a federal defense to remove the case, but found that the district court erred in dismissing the case for lack of subject matter jurisdiction and remanded with instructions for the case to be remanded to state court. (SCUDDER and JACKSON-AKIWUMI, concurring)

In a consolidated appeal, the defendant companies were subject to a civil enforcement action after they made millions of telemarketing calls to consumers who were on the National Do Not Call Registry. The district court found the defendants liable on summary judgment and awarded civil penalties and the defendants appealed both the liability findings as well as the damages award. The Seventh Circuit affirmed the liability findings, explaining that there was no genuine issue of material fact that their practices were prohibited by federal regulation. But the appellate court reversed and remanded the district court’s decision to substitute an individual defendant’s estate upon his death because it was a penal action that did not survive the defendant’s death. (JACKSON-AKIWUMI and KOLAR, concurring)

In a qui tam action, the plaintiff, on behalf of the United States and the State of Indiana, against HealthNet, a federally qualified health center that provides services to individuals at or below the poverty level. On appeal, the relator opposed a settlement between the state and the defendant as unfair because it reduced her share. The relator also contested the district court’s dismissal of count III of her complaint, which sought to enforce an alleged oral settlement agreement, for lack of subject matter jurisdiction. The Seventh Circuit affirmed, finding that the relator lacked standing to bring Count III of the amended complaint and that the settlement between the state and the defendant was fair, adequate, and reasonable. (ST. EVE and PRYOR, concurring)

In a class action lawsuit challenging the treatment of prisoners with gender dysphoria by the Illinois Department of Corrections, the defendant prison officials appealed from the imposition of several injunctions and a finding of civil contempt by the district court. The Seventh Circuit vacated the injunctions finding that they were preliminary in nature and expired 90 days after they were entered and that they could not retroactively be transformed into permanent injunctions as was argued by the plaintiffs. The appellate court dismissed the challenge to the findings of contempt for lack of jurisdiction because the district court had not yet imposed any sanctions. (ROVNER and KIRSCH, concurring)

Plaintiff filed a complaint alleging racial discrimination against her former employer and appealed after the district court dismissed the case because it was filed five days late and was time-barred. The Seventh Circuit affirmed, finding that the late filing, which was due to human error, did not constitute an “extraordinary circumstance” that would warrant equitable tolling and the district court did not abuse its discretion in granting the motion to dismiss. (ELLIS and COBBS, concurring)