Articles Posted in U.S. Court of Appeals for the First Circuit

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Gerardo Salvati died from injuries he sustained while doing maintenance work. Gerardo’s wife, Lucia (hereinafter referred to as Salvati) filed a lawsuit seeking damages for wrongful death and loss of consortium. The underlying defendants had a primary policy through Western World Insurance Company in the amount of $1 million and an excess policy through the American Insurance Company (AIC) in the amount of $9 million. AIC refused to provide coverage to the underlying defendants. Salvati and the underlying defendants eventually reached a $6 million settlement agreement. In exchange for tendering the full $1 million of the Western World primary insurance policy, the agreement released Western World and the underlying defendants from any further liability and assigned all rights held by the underlying defendants against AIC to Salvati. Thereafter, Salvati filed a complaint against AIC, alleging, inter alia, breach of contract and seeking a declaratory judgment that she was entitled to collect $5 million from AIC under the excess policy. The district court dismissed the complaint for failure to state a claim. The Supreme Court affirmed, holding (1) Salvati failed to show that the settlement agreement triggered AIC’s duty to indemnify; and (2) Salvati may not bring a claim under Mass. Gen. Laws ch. 176D, and therefore, none of her causes of action survived. View "Salvati v. American Insurance Co." on Justia Law

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Hubbard Systems, Inc. (HSI) was in the business of developing, marketing, and selling a debt collection software program titled “Collection Partner.” In 1992, Gregory Turner entered into a rent-to-own agreement with HSI in which he was granted a temporary rental license for the use of Collection Partner. Turner made the final installment payment in 1996, after which Turner owned a permanent license to the software. In April 2011, HSI sent Turner a new license key to reflect an update in the software. The license expired on May 31, 2011. On June 1, 2011, HSI sent Turner a new license key that permitted him uninterrupted access to the software. In 2012, Appellant brought suit, alleging that HSI violated the Computer Fraud and Abuse Act when it issued a license key that expired on May 31, 2011, despite the fact that he owned a permanent license to the Collection Partner software. The district court accepted and adopted the magistrate judge’s report and recommendation, denied Turner’s motion to strike, and granted summary judgment in favor of HSI. The First Circuit affirmed, holding that the district court did not err in granting HSI’s motion for summary judgment and denying Turner’s motion to strike. View "Turner v. Hubbard Systems, Inc." on Justia Law

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Plaintiff purchased CVS-brand Vitamin E 400 International Units Softgels at a CVS in Plainview, New York. The bottle containing the product bore a label that advertised the product as supporting “heart health.” Plaintiff filed a putative class action complaint, claiming that there were no scientifically valid studies supporting the “heart health” statements. In her complaint, Plaintiff asserted a violation of the New York Consumer Protection Act (NYCPA) and a piggy-back common law claim of unjust enrichment. The district court dismissed Plaintiff’s complaint for failure to state a claim, concluding that federal law preempted Plaintiff’s effort to maintain this action under New York’s consumer protection law. The First Circuit reversed, holding (1) neither federal nor state law posed any bar to recovery under NYCPA to the extent that recovery was predicated on a failure by CVS to comply with the requirements of Federal Food Drug and Cosmetic Act section 343(r); and (2) the complaint adequately alleged that the label’s statements were misleading in a manner that violated the requirements of section 343(r), and therefore, the unjust enrichment count was also not preempted. View "Kaufman v. CVS Caremark Corp." on Justia Law

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After seeking a mortgage modification under the Home Affordable Modification Program Plaintiff filed a complaint against Wells Fargo Bank, N.A. and Homeward Residential Inc., claiming breach of contract, unfair debt collection under Mass. Gen. Laws ch. 93A, and derivative equitable relief. A federal district court dismissed Plaintiff’s action in its entirety. The First Circuit vacated and remanded, holding that Plaintiff’s complaint sufficiently alleged that Defendants failed to offer her a mortgage modification in a timely manner and that Plaintiff had sufficiently pled damages for her Chapter 93A claim. On remand, the district court granted summary judgment in favor of Defendants. The First Circuit affirmed, holding that Plaintiff’s breach of contract and Chapter 93A claims failed, and therefore, her derivative claim for equitable relief failed as well. View "Young v. Wells Fargo Bank, N.A." on Justia Law

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TelTech Systems, Inc.’s SpoofCard service, a prepaid minutes-based calling service, enables customers to disguise the phone number from which they place calls. In 2009, a customer placed several phone calls to Appellant using SpoofCard and, posing as someone else, made a series of sexually harassing comments to Appellant. Appellant sued TelTech under Massachusetts’s consumer protection statute. The district court granted summary judgment for TelTech, concluding that no reasonable jury could find that TelTech’s actions caused Appellant’s injuries. The First Circuit affirmed, holding that the district court did not err in ruling that, on this record, TelTech was entitled to summary judgment on Appellant’s state law claim. View "Walsh v. Teltech Systems, Inc." on Justia Law

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Three putative class action complaints alleged that Defendants engaged in deceptive marketing and advertising about the health benefits of certain “barefoot” running shoes. The district court preliminary approved a settlement and certified a class for settlement purposes only. Notice was subsequently distributed to the class, and some 154,927 timely claims were filed. Objections were filed by three individuals, none of whom complied with the requirement in the proposed settlement agreement that proof of purchase must be submitted with an objection to establish class membership. The district court rejected the objectors’ claims, approved the proposed settlement, and awarded attorneys’ fees and expenses to class counsel. The First Circuit affirmed, holding (1) there was no misrepresentation in the notices sent to class members; (2) the settlement was fair, reasonable, and adequate; (3) the district court did not abuse its discretion in concluding that injunctive relief was a valuable contribution to the settlement agreement; and (4) there was no abuse of discretion in the district court’s award of attorneys’ fees. View "Bezdek v. Vibram USA, Inc." on Justia Law