Tag: Supreme Court

1
Expounding on Arbitrability: The Seventh Circuit Joins the Growing Ranks of Circuit Courts Finding that Courts Presumptively Decide the Availability of Class Arbitration
2
American Bankers Association Weighs In With a Comment on HUD’s Disparate Impact Rule
3
No More Zombie Class Actions: Supreme Court Stops Class Members from Filing Successive Class Claims after Expiration of Limitations Period
4
Shedding Some Light: SCOTUS Grants Cert. in Lamps Plus to Answer Question on State-Law Contract Interpretation and Class Arbitration
5
A First in the Second (Circuit): On Remand, District Court Breaks New Ground by Vacating Arbitrator’s Class Certification Award
6
Supreme Court Again Declines to Review Ruling That Courts Determine Availability of Classwide Arbitration
7
Balancing Act: Supreme Court Rules That Filing a Proof of Claim for Stale Debt Does Not Violate the Fair Debt Collection Practices Act
8
U.S. Supreme Court Declines to Consider Whether National Bank Act Preemption Extends to Purchasers of Debt Originated by National Banks
9
Supreme Court Vacates and Remands Ninth Circuit Decision on Article III Injury-in-Fact in Spokeo
10
“Take Me Out to the Ballgame?” Asked the Inspector: Saying “Yes” May Now Be a Federal Crime

Expounding on Arbitrability: The Seventh Circuit Joins the Growing Ranks of Circuit Courts Finding that Courts Presumptively Decide the Availability of Class Arbitration

By Andrew C. GlassRobert W. Sparkes, IIIElma DelicRoger L. Smerage

The U.S. Supreme Court has issued numerous decisions over the past decade addressing arbitration agreements. [1] In one of the Roberts Court’s first forays into the arbitration arena, the Court held that class or collective arbitration is only available where the parties have affirmatively agreed to resolve their disputes through such procedures. [2] But who determines whether the parties have so agreed — a court or an arbitrator?

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American Bankers Association Weighs In With a Comment on HUD’s Disparate Impact Rule

By Paul F. HancockOlivia Kelman

On behalf of the American Bankers Association and state bankers associations across the country, K&L Gates partner Paul F. Hancock and associate Olivia Kelman crafted a comment that was submitted to the U.S. Department of Housing and Urban Development (“HUD” or “Department”) on August 20, 2018, in support of reopening rulemaking regarding the Department’s implementation of the Fair Housing Act’s disparate impact standard. On June 20, 2018, HUD issued an advance notice of proposed rulemaking that sought public comment on possible amendments to the Department’s 2013 final disparate impact rule in light of the U.S. Supreme Court’s decision in Texas Department of Housing and Community Affairs v. Inclusive Communities Project, Inc., 135 S. Ct. 2507 (2015). In that decision, the Supreme Court articulated the standards for, and the constitutional limitations on, disparate impact claims under the Fair Housing Act. The comment explains that the rule should be amended because it adopts standards that are inconsistent with Supreme Court precedent, fails to provide much needed guidance to entities seeking to comply with the law, and is therefore outdated and ineffective. A copy of the comment is available here.

No More Zombie Class Actions: Supreme Court Stops Class Members from Filing Successive Class Claims after Expiration of Limitations Period

By: Andrew C. Glass, Roger L. Smerage, Elma Delic                     

The U.S. Supreme Court has ruled that a plaintiff cannot file a class action outside the applicable statute of limitations merely because an unsuccessful prior class action tolled the limitations period for individual claims.[1]  In China Agritech v. Resh,[2] the Court held that its prior jurisprudence “does not permit the maintenance of a follow-on class action past expiration of the statute of limitations.”[3]  Rather, that jurisprudence only tolls the statute of limitations for unnamed class members to intervene in the action “individually or file individual claims if the class fails.”[4]  In reaching this conclusion, the Court recognized that “[t]he Federal Rules [of Civil Procedure] provide a range of mechanisms to aid courts in” overseeing complex litigation, such as where individual claims are added on after a denial of class certification.[5]  But, critically, “[w]hat the Rules do not offer is a reason to permit plaintiffs to exhume failed class actions by filing new, untimely class claims.”[6]

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Shedding Some Light: SCOTUS Grants Cert. in Lamps Plus to Answer Question on State-Law Contract Interpretation and Class Arbitration

Andrew C. Glass, Robert W. Sparkes, III, Roger L. Smerage, Elma Delic

In Stolt-Nielsen S.A. v. AnimalFeeds International Corp., [1] the U.S. Supreme Court held that “a party may not be compelled” under the Federal Arbitration Act (“FAA”) “to submit to class arbitration unless there is a contractual basis for concluding that the party agreed to do so.” [2] The Stolt-Nielsen Court found that an agreement that is silent on the availability of class arbitration does not provide sufficient evidence that the parties intended to submit to class, as opposed to individual, arbitration. [3] The Court, however, left open the question of what level of specificity an agreement must contain to demonstrate the parties’ consent to submit a dispute to class arbitration. [4]

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A First in the Second (Circuit): On Remand, District Court Breaks New Ground by Vacating Arbitrator’s Class Certification Award

By Andrew C. GlassRobert W. Sparkes, IIIRoger L. Smerage, and  Elma Delic

In what appears to be a first-of-its-kind ruling, the District Court for the Southern District of New York recently concluded that a federal district court has the authority to vacate an arbitrator’s class certification award based on the due process rights of absent class members. That this potentially ground-breaking decision arose from the long-standing litigation in Jock v. Sterling Jewelers, Inc. is no surprise. Over the course of a decade in Jock, the district court and the Second Circuit Court of Appeals have rendered multiple decisions addressing the proper role of a court in reviewing an arbitrator’s authority to determine whether parties have agreed to class arbitration. In the latest decision, the district court became the first court to apply Justice Alito’s concurrence in Oxford Health Plans LLC v. Sutter to strike down an arbitrator’s ruling. The Jock court determined that, absent an express class arbitration provision in each putative class member’s arbitration agreement, an arbitrator does not have the authority to bind absent class members to a class judgment—even if they signed the same form of arbitration agreement as the named plaintiffs. As discussed below, this novel decision could have significant implications.

To read the full alert, click here.

Supreme Court Again Declines to Review Ruling That Courts Determine Availability of Classwide Arbitration

By Andrew C. Glass, Robert W. Sparkes III, Roger L. Smerage, Elma Delic

The United States Supreme Court recently declined to review a ruling that courts, not arbitrators, determine the availability of classwide arbitration. Previous attempts by putative collective or class representatives to obtain certiorari on the issue were unsuccessful. See, e.g., Opalinski v. Robert Half International Inc., 61 F.3d 326, 330-35 (3d Cir. 2014) (“Opalinski I”) (For K&L Gates’ coverage on the denials of the prior petitions see here and here). The Court’s most recent decision in Opalinski v. Robert Half International Inc. suggests that the Court still does not perceive sufficient disagreement, if any, among the federal courts of appeals on the issue. 677 F. App’x 738, 740 (3d Cir. 2017) (“Opalinski II”). As a result, the trend continues that the availability of classwide arbitration is a gateway issue for the courts.

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Balancing Act: Supreme Court Rules That Filing a Proof of Claim for Stale Debt Does Not Violate the Fair Debt Collection Practices Act

By: Phoebe S. Winder, Andrew C. Glass, Gregory N. Blase, Sean R. Higgins, David A. Mawhinney, Theresa A. Roozen, and Brandon R. Dillman

The U.S. Supreme Court has held that the filing of a proof of claim in bankruptcy proceedings with respect to time-barred debt is not a “false, deceptive, misleading, unfair, or unconscionable” act within the meaning of the Fair Debt Collection Practices Act (“FDCPA”) when there continues to be a right to repayment after the expiration of the limitations period under applicable state law. The Court’s decision in Midland Funding, LLC v. Johnson [1] resolved a split among the federal courts of appeal about the application of the FDCPA to proofs of claim in bankruptcy proceedings. While the decision is favorable for creditors, applicable state law (Alabama, in this case) played a key role in the Court’s conclusion that the creditor held a “claim” under the Bankruptcy Code. Creditors must be aware of and review the relevant state law in the jurisdiction of collection to determine whether the filing of a proof of claim could be deemed false, deceptive, or misleading.

To read the full alert, click here.

 

U.S. Supreme Court Declines to Consider Whether National Bank Act Preemption Extends to Purchasers of Debt Originated by National Banks

By Andrew C. Glass and Roger L. Smerage

On Monday, the United States Supreme Court decided not to review whether National Bank Act preemption, which provides national banks with a safe harbor from state usury laws, extends to third-parties that purchase and collect debt originated by national banks. The decision to deny certiorari in Midland Funding, LLC v. Madden, No. 15-610 (U.S. Nov. 10, 2015) (“Madden”), leaves intact a May 2015 decision of the Court of Appeals for the Second Circuit. The Second Circuit had ruled that National Bank Act preemption only applies to purchasers of national-bank-originated debt where the purchaser is a subsidiary or agent of, or is otherwise acting on behalf of, a national bank. (The K&L Gates alert regarding the Second Circuit decision can be found here.)

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Supreme Court Vacates and Remands Ninth Circuit Decision on Article III Injury-in-Fact in Spokeo

By Andrew C. Glass, Brian M. Forbes, Gregory N. Blase, Robert W. Sparkes III, and Roger L. Smerage

On Monday, the United States Supreme Court issued its long-awaited decision in Spokeo, Inc. v. Robins, — U.S. — (No. 13-1339). In rendering its decision, the Court reiterated that to establish Article III standing, a plaintiff must plead an injury-in-fact that is both particular to the plaintiff and concrete. The Court explained that whether a plaintiff has pleaded sufficient facts to allege a concrete injury requires more than just examining whether the plaintiff has pleaded that the defendant violated a federal statute. In particular, the Court held that “a bare procedural violation, divorced from any concrete harm,” does not suffice to “satisfy the injury-in-fact requirement of Article III.” Slip op. at 9-10. As such, the Spokeo plaintiff’s allegation that the defendant’s actions had violated the Fair Credit Reporting Act, 15 U.S.C. §§ 1681, et seq., would not, by itself, demonstrate a plausible injury-in-fact. Rather, “Article III standing requires a concrete injury even in the context of a statutory violation.” Slip op. at 9.

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“Take Me Out to the Ballgame?” Asked the Inspector: Saying “Yes” May Now Be a Federal Crime

By Barry M. Hartman, Michael D. Ricciuti, Jasmine S. McGhee, Brian J. Smith

Imagine this hypothetical: A local fire marshal says to Mary Jones, who runs the residence halls at a major university, “It must be nice having seats at the Saturday football games.” Mary gets the message and thinks that if she agrees to offer the fire marshal tickets, he will be less likely to “nitpick” during his inspections of the residence halls. Could the government claim that this is a bribe by Mary within the meaning of the Hobbs Act’s proscription against “extortion” by public officials?

On May 2, in Ocasio v. United States, the U.S. Supreme Court broadened the reach of federal corruption law to cover private individuals who are involved in extortion conspiracies with government officials and held that anyone — even the bribe payor — who has conspired to engage in extortion can be charged for violation of the Hobbs Act, the federal statute that federal prosecutors use to indict state officials who solicit and take bribes, and can be convicted of conspiracy. In doing so, the Supreme Court has given federal prosecutors a new, and potent, weapon.

To read the full alert, click here.

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