Posts By Andrew Carpenter

In CMH Homes, Inc. v. Goodner, 2013 WL 4749906 (8th Cir, Sept. 5, 2013), the Eighth Circuit confronted the unresolved question of how district court calculate amount in controversy where a party seeks compelled arbitration under Section 4 of the Federal Arbitration Act: should it follow Advance America Servicing of Arkansas, Inc. v. McGinnis, 526 F.3d 1170 (8th Cir. 2008), and evaluate the amount at stake in the arbitration, or does the U. S. Supreme Court's directive from Vaden v. Discover Bank, 556 U.S. 49 (2009) to look through the arbitration petition to the underlying controversy control? Writing for the panel, Judge Colloton agreed with the district court's decision to follow Vaden, even though Vaden involved federal question jurisdiction rather than diversity jurisdiction.  In doing so, the Court concluded that nothing in either the text of Section 4 of the FAA or the rationale of Vaden suggests that a court…

In Morgan v. Saint Luke’s Hospital of Kansas City, 403 S.W. 3d 115 (June 28, 2013), the Missouri Court of Appeals addressed this issue of first impression and reversed the trial court’s grant of judgment on the pleadings, holding that St. Luke’s was not entitled as a matter of law under Section 430.230 to assert a lien on the patient’s claim against a third party tortfeasor where the patient’s insurer had already paid the patient’s bill pursuant to its discounted payment agreement with the hospital.  In this case, the plaintiff had been the victim of a motor vehicle accident, had been treated at St. Luke’s, and her insurer had then paid her discounted bill according to a discounted payment agreement between St. Luke’s and the insurer. St. Luke’s then returned the discounted payment to the insurer, and then filed a lien for 100% of its billed charges on Ms. Morgan’s claim against…

For those who don't opt in until the class is conditionally certified, that's who.  In Greenstein v. Meredith Corp., 2013 WL 4028732 (D. Kan., Aug. 7, 2013), class counsel asked the District Court to equitably toll the limitations period for the eleven-month period from the time plaintiffs' motion for conditional certification was filed, and the time it was granted. Normally in FLSA cases the limitations period is not tolled until the class member opts into the conditionally certified class. Plaintiff argued that the long delay in resolving conditional certification justified equitable tolling. Judge Rogers disagreed, explaining that although the Tenth Circuit has not addressed the issue of equitable tolling in the context of an FLSA class, it usually applies that doctrine restrictively only where the defendant has actively misled the plaintiff respecting the cause of action, or in other extraordinary circumstances. Judge Rogers also determined that the factors applied by…

We all know that constitutional standing requires an injury-in-fact that is fairly traceable to the challenged conduct of the defendant.  But how exactly does that operate under the Electronic Fund Transfer Act, 15 U.S.C. 1963, which requires two forms of notice of transactions fees on ATMs, both on-machine notice and on-screen notice, and provides for statutory damages? In Charvat v. Mutual First Federal Credit Union, 725 F.3d 819, 2013 WL 3958300 (8th Cir., August 2, 2013), the plaintiff sought to certify a class of persons charged transaction fees on the Bank/defendant's machines, which lacked the prescribed on-machine notice (but provided on-screen notice).  The District Court dismissed the claims of Charvat, the putative class representative, for lack of standing, concluding that Charvat had alleged an injury at law, but not in fact. Judge Shepherd, writing for the panel, reversed.  Without addressing whether Charvat suffered an economic injury from the $2.00 transaction fee,…

In a thorough per curiam order, the Kansas Court of Appeals emphatically reversed the District Court's order certifying a class of "free gas" users.  In Combs v. Devon Energy Prod. Co., 2013 WL 3867981 (Kan. App. July 26, 2013), the Court of Appeals concluded that the District Court had abused its discretion in certifying a class consisting of resident owners of surface estates burdened with oil and gas leases held by Devon where the leases contained "free gas clauses", ie. clauses entitling the lessor to connect to and draw from any gas well on the land for his or her own use free of charge.  The class had sought a declaration that the free gas clauses in the leases obligated Devon to provide a usable supply of free gas, which it alleged Devon had failed to provide due to pressure and moisture issues. The District Court certified the class under both…

In an interesting case of first impression, the District Court of Kansas held that the United States Supreme Court's recent decision in Genesis HealthCare Corp. v. Symczk, 133 S.Ct. 1523 (2013) (which we discussed back in April), does not allow defendants to moot an FLSA claim by making an offer of judgment to a representative plaintiff pursuant to Fed. R. Civ. P. 68.  In Michaels v. City of McPherson, Kansas, 2013 WL 3895343 (D. Kan., July 29, 2013), the City/Defendant served an offer of judgment on the lone plaintiff asserting an FLSA claim while the motion for conditional certification was pending (and of course before any class members were able to opt into the class).  The Defendant then opposed Plaintiff's motion to amend the complaint to add a new representative plaintiff on the grounds that amendment was futile, asserting that the offer of judgment mooted the Plaintiff's claims under Genesis…

In Halvorsen v. Auto-Owners Ins. Co., 718 F.3d 773 (8th Cir. July 3, 2013), an Eighth Circuit panel consisting of Judges Loken, Smith, and Benton reversed the District court’s certification of a class of North Dakota insureds asserting breach of contract and bad faith claims based on the denial of personal injury protection (“PIP”) claims though the insurer’s Reasonable & Customary (“R&C”) deductions.  Under the R&C system, AOI would employ claim reviewers to review PIP claims and recommend denial of coverage for claims above the “80th percentile” – ie, the amount charged by eighty percent of the medical providers in the geographic area for comparable services.  The District Court denied certification to a parallel group of Minnesota insureds because Minnesota law mandated that all no-fault insurance claims for less than $10,000.00 be arbitrated, hence causing profound numerosity and typicality problems.   But the District Court certified a class consisting essentially of…

Cy pres - A French term for "ok, close enough" - can be tricky. The wrong has been righted, but either the class has been fully compensated, or the compensation is too de minimis or impractical to allocate and distribute. What to do? Give it away to charity, but not just any charity. This issue confronted the Court in In re Bank of America Corp. Sec. Litig., 2013 WL 3212514 (E.D. Mo., June 24, 2013). In that securities fraud MDL, the global settlement of $490,000,000.00 had been approved, and all class members had been paid. Yet, due to problems locating class members, duplicate payments, restitution, and interest, class counsel found themselves with $2,734,136.69 remaining in the kitty. This was even after the claim administrator had been caught embezzling $5,000,000.00 from the fund. Not a bad problem to have, but a problem nonetheless. After rejecting the motion of the claims administrator…

What happens when the hunter becomes the hunted? In General Credit Acceptance Corp. v. Deaver, 2013 WL 2420392 (E.D. Mo., June 3, 2013), the hunter remains in state court unless he realigns the parties prior to removal. In that case, GCAC filed a simple one-count petition for breach of a retail installment contract in St. Louis County, and got hit with a counterclaim seeking to certify a consumer class action under the UCC. GCAC promptly tried to get its head out of the bear trap by dismissing its breach of contract claim and removing the case to the Eastern District, using the class action counterclaim as a hook to assert removal jurisdiction under CAFA. While it is well-settled that a plaintiff may not remove a case to federal court based on a counterclaim, GCAC argued that it was only a nominal plaintiff and in reality a de facto defendant, having…

Judge Limbaugh's analysis in City of O'Fallon v. Centurylink, Inc., 2013 WL 1036514 (E.D. Mo., March 14, 2013), is interesting in two respects. First, it's interesting because the Court did not simply decline to exercise its jurisdiction as Judge Fleissig did in City of Maryland Heights v. Trafcone Wireless, Inc., 2013 WL 791866 (E.D. Mo., March 4, 2013), a similar class action composed of plaintiff municipalities seeking to recover business license taxes from defendant providers of telephone services. It's also interesting for its thorough discussion of what exactly constitutes a "significant defendant" for purposes of applying CAFA's Local Controversy Exception. This analysis was a bit of overkill because the Court had already determined that the removing defendants had failed to meet their burden of establishing both the requisite amount in controversy (defendants had pleaded only $4.2 million in controversy in their Notice of Removal and had inexplicably ignored attorneys' fees…

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