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Case Summaries

Administrative Law

[07/03] State Comp. Ins. Fund v. WCAB
The California Supreme Court finds that the Legislature intended to require employers to conduct utilization review when considering requests for medical treatment, and employers may not use Labor Code section 4062 as an alternative method for disputing employees' treatment requests.

[07/03] Tablada v. Thomas
In a case involving whether the Bureau of Prisons (BOP) violated the Administrative Procedure Act (APA) in promulgating a regulation interpreting 18 U.S.C. section 3624(b), which governs the calculation of good conduct time for federal prisoners, the court finds that: 1) the BOP concededly violated the APA by failing to articulate a rational basis for its decision to promulgate the regulation; but 2) the remedy for the violation is to interpret the federal statute in accordance with the BOP's Program Statement 5880.28; and 3) the BOP's methodology for calculating good time credits under Statement 5880.28 was both reasonable and persuasive under applicable law.

[07/03] Lands Council v. McNair
Denial of a preliminary injunction to halt a project, which called for the selective logging of 3,829 acres in a national forest, is affirmed where: 1) plaintiff was not likely to succeed on any of its claims under the National Forest Management Act (NFMA) or the National Environmental Policy Act (NEPA); and 2) plaintiff failed to show that, if the Forest Service were allowed to proceed with the project, the balance of hardships tipped sharply in its favor. (En banc opinion)

[07/03] BNSF Ry. Co. v. Swanson
Provisions of Minnesota Statute sections 609.849(a)(1) and (a)(2), governing a railroad's treatment of injured workers, are both preempted by the Internal Control Plans regulations adopted by the Federal Railroad Administration pursuant to the Federal Railroad Safety Act.

[07/03] Jacob v. West Bloomfield
In a suit brought under 42 U.S.C. section 1983 alleging a violation of plaintiff's Fourth Amendment rights when defendant entered plaintiff's property without a warrant to inspect the property for criminal violations of a land use ordinance, denial of summary judgment for defendant is affirmed where: 1) the purpose of the government intrusion was not merely administrative but also bore the threat of criminal sanctions; and 2) the fact that plaintiff did not endure an even more intrusive search does not obviate the Fourth Amendment's requirement that, absent exigent circumstances, officials may not conduct criminal investigations within the curtilage of a person's home without a warrant.

[07/02] Chicago Bridge & Iron Co. v. Fed. Trade Comm'n
Petition for review an order of the Federal Trade Commission requiring petitioner to divest assets acquired from a Pennsylvania company since they would likely result in a substantial lessening of competition or tend to create a monopoly is denied where: 1) the FTC correctly applied the legal standards of burdens of proof and persuasion; 2) the FTC properly analyzed the "potential entry" defense and had substantial evidence to conclude that "potential entry" evidence was insufficient to rebut the prima facie case; 3) substantial evidence supported its factual findings; and 4) there was no abuse of discretion in the issuance of its remedy provisions.

[07/02] Sunset Skyranch Pilots Ass'n v. County of Sacramento
The State Aeronautics Act does not compel a county to allow continued operation of an airport. Further, denying the renewal of a conditional use permit, which will result to the closure of an airport, is a "project" that requires an initial study as provided for under the California Environmental Quality Act.

[07/02] Deckers Corp. v. US
In a suit contesting the proper classification of three styles of sports sandals under the Harmonized Tariff Schedule of the United States, a decision holding that the merchandise was properly classified under subheading 6404.19.35 is affirmed where the sandals at issue have open toes and open heels, and lack the features of the named exemplars of 6406.11.80, and thus the imported goods are not classifiable under that subheading notwithstanding their claimed status as athletic footwear.

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Class Actions

[07/02] Sgro v. Danone Waters of N. Am., Inc.
In an ERISA action arising from a denial of plaintiff's claim for disability benefits, dismissal of plaintiffs' claims is affirmed in part and vacated in part where: 1) dismissal of state law claims was proper as defendant's disability plan is governed by ERISA, but the dismissal should have been without prejudice; 2) a California insurance regulation does not require defendants to reimburse plaintiff for the cost of copying the medical records that defendant-insurer/administrator requested, as that regulation is preempted by ERISA; 3) defendants did not violate ERISA's regulation on "claims procedures" by requiring documentation from plaintiff regarding his claim; and 4) a remand was required in part as to dismissal of a claim that defendants violated ERISA section 1132(c)(1) for failing to turn over certain documents.

[07/02] Appel v. Spiridon
A preliminary injunction, preventing defendants from requiring plaintiff to submit to a psychological examination in order to maintain her teaching position at a state school, is reversed and remanded in light of a recent Supreme Court decision holding that the Equal Protection Clause does not apply to a public employee asserting a violation of the Clause based on a "class of one" theory.

[06/30] Strawn v. AT&T Mobility LLC
In a class action suit brought under the West Virginia Consumer Credit and Protection Act challenging defendant-AT&T's practice of enrolling new subscribers to a "roadside assistance" program for an additional charge without the customer's knowledge, an order remanding the case to state court is reversed and the case remanded where: 1) a party seeking to invoke federal jurisdiction must allege it in its notice of removal and, when challenged, must demonstrate the basis for federal jurisdiction; 2) defendant correctly defined the class as any customer who was charged after being automatically enrolled in the program without ever requesting or enrolling for the service; and 3) defendant demonstrated that the jurisdiction amount under the Class Action Fairness Act's (CAFA) was satisfied.

[06/26] Rahman v. Chertoff
In an interlocutory appeal in a suit alleging violations of constitutional rights and seeking more effective ways of improving the FBI's and the Department of Homeland Security's methods of identifying and screening travelers, certification of two nationwide classes is reversed and remanded where: 1) the classes in the case failed to meet the typicality requirement of Rule 23(a)(3); 2) the classes were too ambulatory; and 3) the wrongs alleged were best addressed by individual lawsuits.

[06/26] John B. v. Goetz
In a class action suit related to Tennessee's TeenCare program seeking to enforce certain provisions of the Social Security Act, defendant's request for mandamus relief from two discovery orders is granted in part where: 1) disobeying the order and appealing a citation for contempt would not be an adequate means to attain relief; 2) the orders will cause defendants to suffer damage or prejudice that cannot be corrected on appeal; 3) the district court abused its discretion since it failed to account properly for the significant privacy and confidentiality concerns in the case; and 4) there were issues of federalism and comity that are not present in typical civil litigation.

[06/23] Larson v. JPMorgan Chase & Co.
In a class action suit over alleged misrepresentations contained in a prospectus for a merger transaction, denial of appellant's motion to intervene as a plaintiff in order to appeal a three and a half year old summary judgment order is affirmed where: 1) appellant was a sophisticated investor and should have known about the class action and summary judgment order denying certification for early purchasers of the stock; 2) the statute of limitations ran out on the claim for early purchasers three years prior to appellant's motion; and 3) the district court did not abuse its discretion when it considered appellant's motion to intervene untimely.

[06/20] Nichols v. Alcatel USA Inc.
In a class action suit contesting changes to defendant's benefit plans, denial of a motion for a preliminary injunction by the plaintiffs is affirmed where: 1) plaintiffs failed to demonstrate a substantial likelihood of success on the merits of their ERISA claims; 2) plaintiffs similarly failed as to their claim that collective bargaining agreements and the Termination Agreement vested medical insurance benefits; 3) plaintiffs failed to show that they would suffer irreparable harm since they could continue with their current coverage until a judgment is rendered; and 4) the court properly determined that the threatened injury to plaintiffs would not outweigh any damage the injunction might cause defendant.

[06/19] Clemens v. DaimlerChrysler Corp.
In a class action against DaimlerChrysler alleging that it breached express and implied warranties and committed fraud in the sale of certain Dodge Neon cars containing defective head gaskets, dismissal and summary judgment rulings for defendant are affirmed where: 1) plaintiff failed to allege that his Dodge Neon failed to perform as expressly warranted; 2) an implied warranty claim failed as plaintiff was not in vertical privity with DaimlerChrysler as required by state law; 3) thus, state law and the Magnuson-Moss Act claims were properly dismissed; 4) the statute of limitations barred a fraud claim; and 5) an Unfair Competition Law claim failed as defendant's conduct was not unfair within the meaning of the statute, and there was insufficient evidence that the gasket's failure rate was material to a reasonable consumer.

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Constitutional Law

[07/03] Easley v. Reuss
On petition for rehearing, the circuit court grants a petition to cure an administrative error to a prior order but declines further review where: 1) petitioner failed to meet the strict requirements of Appellate Rule 35 for a hearing en banc; and 2) petitioner was raising issues that were not previously raised.

[07/03] Jacob v. West Bloomfield
In a suit brought under 42 U.S.C. section 1983 alleging a violation of plaintiff's Fourth Amendment rights when defendant entered plaintiff's property without a warrant to inspect the property for criminal violations of a land use ordinance, denial of summary judgment for defendant is affirmed where: 1) the purpose of the government intrusion was not merely administrative but also bore the threat of criminal sanctions; and 2) the fact that plaintiff did not endure an even more intrusive search does not obviate the Fourth Amendment's requirement that, absent exigent circumstances, officials may not conduct criminal investigations within the curtilage of a person's home without a warrant.

[07/03] MLC Automotive, LLC v. Town of Southern Pines
In a suit alleging that the rezoning of a certain piece of real estate violated plaintiff's common law vested rights in the property and its federal and state substantive due process rights, denial of defendants' Rule 60(b) motion is affirmed where: 1) defendant-town's Rule 60(b) motion was filed within ten days of the original judgment, called into question the correctness of the judgment, and is properly construed as a Rule 59(e) motion; 2) the district court did not abuse its discretion in concluding that Burford abstention was appropriate because the case involved difficult issues of state land use policy.

[07/02] Ctr. for Bio-Ethical Reform, Inc. v. Los Angeles County Sheriff Dep't
In an action alleging police officers violated plaintiffs' constitutional rights by ordering them to remove their truck (which displayed enlarged, graphic photographs of early-term aborted fetuses) from an area adjacent to a middle school, and by detaining them and searching the vehicle, summary judgment and dismissal rulings for defendants are reversed in part where: 1) plaintiffs' First Amendment rights were violated; 2) however, individual defendants were entitled to qualified immunity from a damages action on the issue; 3) plaintiffs established a violation of their Fourth Amendment rights because of the unreasonable length of two individuals' detention; and 4) they raised a genuine issue of fact as to whether the deputy sheriffs unlawfully entered their security vehicle.

[07/02] Lundeen v. Canadian Pac. Ry. Co.
In consolidated appeals challenging the constitutionality of Congress's recent amendment to 49 U.S.C. Section 20106 of the Federal Railway Safety Act, the circuit court finds that: 1) Congress did not violate the constitution in making the amendment, and thus the federal preemptive effect directly addressed by the amendment applies to the underlying case; and 2) arguments advanced with respect to the amendment's violation of separation of powers doctrine, due process, equal protection, and Ex Post Facto clauses failed.

[07/02] US v. Aref
In an appeal involving challenges to a denial of a third party's motion to intervene in a terrorism-related criminal case for purposes of asserting a First Amendment right to discovery of documents sealed by court order, the circuit court finds that: 1) pursuant to section 4 of the Classified Information Procedures Act, a criminal defendant is entitled to discovery of relevant classified evidence that is helpful to his defense, and such decision is within the district court's discretion and may be made without a defendant's or his lawyer's participation; 2) denials of motions to intervene in criminal cases are reviewed for abuse of discretion; 3) while district courts ordinarily should refrain from entirely (as opposed to selectively) sealing court orders and documents filed by the parties, there was no error in doing so under the circumstances of this case.

[07/02] Appel v. Spiridon
A preliminary injunction, preventing defendants from requiring plaintiff to submit to a psychological examination in order to maintain her teaching position at a state school, is reversed and remanded in light of a recent Supreme Court decision holding that the Equal Protection Clause does not apply to a public employee asserting a violation of the Clause based on a "class of one" theory.

[07/01] County of San Diego v. State of California
In actions brought by separate Californian counties seeking reimbursement under article XIII B, section 6 of the state constitution for costs of providing state-mandated programs and services for various fiscal years at issue, judgment which included an issuance of a writ of mandate requiring the state to pay the amount of judgment plus interest accrued is reversed where 1) the trial court did not properly award the monetary relief in the judgment as declaratory relief or relief incidental to declaratory relief when there was no controversy as to the state's reimbursement obligations to the counties for the subject state mandates or the amount of those obligations; and 2) the monetary award cannot be sustained as damages for violations of article XIII B, section 6, and its implementing statutes or as relief incidental to mandamus relief.

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ERISA

[07/02] Sgro v. Danone Waters of N. Am., Inc.
In an ERISA action arising from a denial of plaintiff's claim for disability benefits, dismissal of plaintiffs' claims is affirmed in part and vacated in part where: 1) dismissal of state law claims was proper as defendant's disability plan is governed by ERISA, but the dismissal should have been without prejudice; 2) a California insurance regulation does not require defendants to reimburse plaintiff for the cost of copying the medical records that defendant-insurer/administrator requested, as that regulation is preempted by ERISA; 3) defendants did not violate ERISA's regulation on "claims procedures" by requiring documentation from plaintiff regarding his claim; and 4) a remand was required in part as to dismissal of a claim that defendants violated ERISA section 1132(c)(1) for failing to turn over certain documents.

[07/02] Wakkinen v. UNUM Life Ins. Co. of Am.
In an ERISA action, summary judgment for defendant upholding its denial of long-term disability benefits under an employer-offered plan is affirmed where substantial evidence supported plan administrator's finding that claimant was not "continuously disabled" through the 180 days of his elimination period as defined within the policy in dispute.

[07/02] Newell Operating Co. v. Int'l Union of United Auto., Aerospace, & Agric. Implement Workers of Am.
In a declaratory judgment suit arising from plaintiff's decision to amend its employee welfare benefits plan to allow administrators to charge retirees uniform monthly premiums, dismissal of the case is affirmed where: 1) jurisdiction did not exist under section 502(a)(3) of ERISA since the declaratory judgment action was not designed to enforce any provisions of the plan or makes any valid allegations that ERISA will be violated; and 2) although plaintiff's LMRA section 301 claims fall within the statute, the request for declaratory judgment is covered by the Declaratory Judgment Act and the court used the discretion given under the Act to decline jurisdiction.

[06/30] Stamp v. Metropolitan Life Ins. Co.
Plan administrators of an employee benefits plan governed under ERISA may reasonably conclude that an insured, killed in a one-car collision with a tree while driving with BAC of 3 times the legal limit, did not die as a result of an "accident" for purposes of his Accidental Death and Dismemberment life insurance policies.

[06/26] Gutta v. Standard Select Trust Ins. Plans
In a suit arising from defendant's determination that the plaintiff was no longer eligible for continuing disability benefits after it found that plaintiff was able to perform any gainful occupation under the terms of its plan, summary judgment for defendant on a counterclaim for restitution of the disability benefits and against plaintiff on his claim is affirmed where: 1) no enforceable settlement contract came into being since there was no meeting of the minds; 2) a finding that plaintiff could obtain other employment as described in the plan was not arbitrary and capricious since it was based on substantial evidence that was consistent with the medical evidence in the record; 3) a counterclaim was not a state law claim for damages due to commingling of assets or dissipation, since there is an equitable lien by agreement between plaintiff and defendant.

[06/24] IN Funeral Directors Ins. Trust v. Benefit Actuaries, Inc.
In a suit alleging violation of fiduciary duties under ERISA and breaches of common law duties to plaintiff by providing it with bad advice and failing to recommend measures that would stave off insolvency, judgment for defendant is affirmed where: 1) plaintiff did not provide evidence that defendants promised to administer the Trust in accordance with certain state law or that defendants knew the Trust would rely on it to follow the Michigan statute; 2) plaintiff failed to show that defendant assumed a duty to provide actuarial advice; 3) defendant did not breach a duty by failing to advise trustees about the risk of raising the specific stop loss deductible and about the Trust's poor financial situation; and 4) defendant did not breach a duty by failing to recommend that the Trust maintain adequate reserves.

[06/23] Jackson v. Prudential Ins. Co.
Judgment rejecting claimant's allegation that his ERISA claim for long term disability benefits was wrongly decided is affirmed where the plan administrator's conclusion was not arbitrary nor an abuse of discretion in light of the substantial evidence in this case.

[06/20] Nichols v. Alcatel USA Inc.
In a class action suit contesting changes to defendant's benefit plans, denial of a motion for a preliminary injunction by the plaintiffs is affirmed where: 1) plaintiffs failed to demonstrate a substantial likelihood of success on the merits of their ERISA claims; 2) plaintiffs similarly failed as to their claim that collective bargaining agreements and the Termination Agreement vested medical insurance benefits; 3) plaintiffs failed to show that they would suffer irreparable harm since they could continue with their current coverage until a judgment is rendered; and 4) the court properly determined that the threatened injury to plaintiffs would not outweigh any damage the injunction might cause defendant.

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