Seventh Circuit Court of Appeals Commentary : In Their Opinion : Lawyer & Attorney Michael E. Rigney : Kelley Drye & Warren Law Firm

SPIVEY v. ADAPTIVE MARKETING (September 20, 2010)

Quinten Spivey ordered a diet product over the telephone from Adaptive Marketing in early 2003. Adaptive Marketing claims that its representative continued the conversation and told Spivey that she would send him a "risk free" 30-day membership in HomeWorks (apparently some kind of retail discount program), that he could cancel the membership within 30 days, that he would be billed $96 per year if he did not cancel, and that the membership would renew automatically each year. Spivey, on the other hand, claims that he does not recall the conversation and that he never received membership materials (or, if he did, that they were designed to look like junk mail). In any event, Adaptive Marketing charged Spivey's credit card $96.00 in 2003, $149.95 in 2004, $199.95 in 2005, $199.95 in 2006, and an unknown amount in 2007. Each charge was shown as "HomeWorks" and included a reference telephone number. Spivey brought suit for breach of contract and unjust enrichment. Judge Reagan (S.D. Ill.) granted summary judgment to Adaptive Marketing on the contract claim concluding, in the alternative, that a) there was both an oral and written contract that Adaptive Marketing did not breach, and b) Spivey's claim is barred by the voluntary payment doctrine. The court also granted summary judgment on the unjust enrichment claim on the alternative bases that a) unjust enrichment is not available where a contract exists, and b) recovery is barred by the voluntary payment doctrine. Spivey appeals.

In their opinion, Associate Justice (Ret.) O'Connor and Circuit Judges Kanne and Rover affirmed. The Court did not address the contract theories, resting its holding solely on the voluntary payment doctrine. Under that doctrine, one cannot recover money that has been paid under a claim of right even if paid under a mistake of law, unless there is fraud, coercion or a mistake of fact. Spivey asserts a mistake of fact -- that he assumed for four years but the charges related to purchases made by his wife (she is a teacher and he thought a charge for “HomeWork” must be hers). The Court rejected the mistake of fact claim: each charge was properly identified and included a telephone number, each charge listed the name of the product that he was given in the original telephone call, he never asked his wife about the charges, and he never called the number on his credit card statement about the charges. Illinois law does not accept a mistake of fact claim when the true facts are not obscured and the mistake is a result of the plaintiff's failure to investigate or inquire.

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ILLINOIS v. HEMI GROUP (September 14, 2010)

Hemi Group is located in New Mexico but sells cigarettes throughout the United States (except New York - maybe this is why) through several interactive websites as well as by phone, mail, and fax. Hemi pays the federal tax on the cigarettes it sells but it directs its customers to investigate their own state tax liability. Hemi is not registered to do business in Illinois, has no offices or employees in Illinois, and does not advertise in print media in Illinois. An Illinois Department of Revenue agent purchased hundreds of packs of cigarettes from Hemi in 2005 and 2007. Illinois brought suit in state court against Hemi, alleging numerous violations of law. After removing the case to federal court, Hemi moved to dismiss for lack of personal jurisdiction. Judge Scott (C.D. Ill.) denied the motion. Hemi appeals.

In their opinion, Judges Bauer, Kanne, and Evans affirmed. The Court briefly considered, but rejected, the argument that the Illinois Constitution is more restrictive than the federal constitution in its personal jurisdiction requirements. The Court therefore conducted its analysis with respect to the due process clause of the federal constitution. Since Hemi does not have general, systematic business contacts in Illinois, the Court considered only specific jurisdiction and found that it existed. First, Hemi's contacts with Illinois satisfy due process: a) Illinois customers could buy cigarettes on their many interactive websites, b) they held themselves out as ready to do business in Illinois , c) their refusal to sell to New York residents showed that they were aware of the ramifications of selling into a particular state, and d) they shipped cigarettes into Illinois. The Court emphasized that it was not using the Zippo sliding scale approach that other circuits have adopted for Internet jurisdiction cases. Second, the relatedness requirement for specific jurisdiction is satisfied -- the claims arise out of Hemi's contacts. Finally, the exercise of jurisdiction here "does not offend traditional notions of fair play and substantial justice." Hemi set up a nationwide, online commercial venture. It wanted to do business nationwide and has customers throughout the nation. The Court cautioned against exercising jurisdiction over a company simply because it has an interactive website accessible in the forum state. Here, additional voluntary contacts with the state make the exercise of jurisdiction permissible.

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MCCANN v. IROQOUIS MEMORIAL HOSPITAL (September 13, 2010)

Valerie McCann was forced out of her job as director of physicians' services at Iroquois Memorial Hospital in early February of 2006, most likely as part of a reorganization spearheaded by a new CEO. She was not happy. Dr. Leslie Lindberg provided radiology services to the Hospital. He also disapproved of the new administration and feared that the reorganization could put his opportunities at risk as well. McCann paid a visit to Dr. Lindberg at the Hospital later in February on unrelated business. At some point, the conversation turned to the subject of the Hospital. They were both critical of the Hospital, the CEO, and the Trustees. Unbeknownst to them, much of the conversation was recorded on Lindberg's dictation machine. Susan Freed, who oversaw the staff that transcribed dictated notes, learned of the conversation. She had it transcribed and she turned it over to the CEO. The CEO informed the trustees and provided the transcript to one of them. McCann and Lindberg brought suit against Freed, the CEO, the Hospital, and the trustees. They asserted claims under the Federal Wiretap Act as well as state law. Plaintiffs' theory is that Freed, while collecting some papers from Lindberg's office during his conversation with McCann, surreptitiously turned on his dictation machine to record the conversation. Freed denied doing so. Defendants’ theory is that Lindberg forgot to turn the machine off when McCann arrived. Judge Baker (C.D. Ill.) granted summary judgment to the defendants. McCann and Lindberg appeal.

In their opinion, Judges Flaum, Manion, and Rovner affirmed with respect to the CEO and the trustees but vacated and remanded with respect to the Hospital and Freed. The Court first addressed defendants' argument that it should not consider the McCann and Lindberg affidavits submitted in response to the summary judgment motion because they contradicted earlier testimony about the date of the conversation. The Court conceded that such a rule exists but cautioned that it does not apply when sufficient reasons are provided for any discrepancies. First of all, the Court thought the date to be immaterial. Second, and more important, the changes are easily explained here. The plaintiffs were originally mistaken about the date of the recorded conversation. Information that became readily available only after the complaint was filed (the timestamp on the recording, cell phone records, and canceled checks) all confirmed that the conversation took place on February 24 -- not February 10, as the plaintiffs originally believed. On the merits, the Court addressed the elements of the Wiretap Act claims. The Act prohibits intentionally "intercepting" a conversation or using or disclosing the contents of an interception, knowing that it was unlawful. The Court concluded that there were genuine issues of material fact when all facts and inferences were drawn in plaintiffs' favor. Even if one side's version of the facts or theory is more believable, summary judgment is not the stage to weigh evidence or make credibility determinations. The claims against Freed and the Hospital can proceed. On the other hand, the record contains no evidence on which to base the CEO’s or the trustees’ liability. The only allegation against the CEO is that he used or disclosed the interception -- but that Act requires that he do so with the knowledge that the interception was unlawful. The record does not support such a conclusion. With respect to the trustees, the only allegation is that one of them knew the interception was illegal -- but not that he used or disclosed the information. Even if true, his knowledge would not amount to a violation of the Act.

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TEMME v. BEMIS CO. (September 13, 2010)

Hayssen Manufacturing Company operated a facility in Sheboygan, Wisconsin until 1985. A strike during the summer of that year led to the company's decision to close the plant. The company and the union representing its workers entered into a Plant Closing Agreement (the “Agreement”). The agreement terminated the strike, all employment relationships, and the union bargaining relationship. It also addressed employee benefits. With respect to health benefits, it provided that terminated employees who were not eligible for or who did not apply for retirement benefits could continue their medical coverage for 12 months, or until they were covered by another plan, by paying the full monthly premiums. It further provided that individuals who qualified and elected to retire were eligible for retired employee medical benefits. Although the agreement did not define the scope of "retired employee medical benefits," the final Collective Bargaining Agreement (CBA) did. Among other terms, it provided for: a) two $50 deductibles per year, b) 100% prescription drug coverage, and c) dependent spouse coverage after the death of a retiree. The company provided those benefits, even after being acquired by Bemis Company, until 2004. In 2005, the deductible was increased to $250. In 2007, prescription drug coverage was eliminated. A class action was filed on behalf of the retirees. Judge Stadtmueller (E.D. Wis.) certified the class and granted summary judgment to Bemis. The class appeals.

In their opinion, Circuit Judges Kanne and Williams and District Judge Springmann reversed and remanded. The Court laid out several principles of contract interpretation: a) if a contract is not ambiguous, there is no need for external evidence, b) contract terms are given their ordinary meaning, c) a contract is read as a whole and in conjunction with related documents, and d) welfare benefits contracts are presumed not to create a lifetime vested benefit unless specifically provided. Applying those principles, the Court looked to both the Agreement and the CBA. It rejected Bemis’ argument that the CBA was extrinsic evidence, citing language in the Agreement expressly permitting reference to the CBA "to effectuate the provisions" of the Agreement. Reading the agreements together, the Court concluded that they unambiguously provided retired employees with health benefits. Bemis further argued, however, that any benefits were not vested for life. The Court disagreed, noting that the presumption against vesting is not as strong in a plant closing agreement as it is in, for example, a short-term collective bargaining agreement. It found several indicia of an intent to vest. It identified the "stark contrast" between the terminated employee and retired employee benefits. The retired employee benefits do not have an end date, as do those for the terminated employees. In addition, the provision granting coverage to spouses after the death of a retiree strongly implied an intent to vest lifetime coverage. Although the Court concluded that the Agreement provided for lifetime medical benefits (and it reversed summary judgment in Bemis' favor), it did not conclude that Bemis breached the agreement. The Court found questions of fact regarding whether any changes could be made to the lifetime coverage and the impact, if any, of a reservation of rights clause in the underlying insurance contract. The Court remanded for further determinations. 

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FINCH v. PETERSON (September 10, 2010)

In 1978, the Indianapolis Police Department and the United States Department of Justice entered into a consent decree designed to correct racial discrimination in the Department. The long-range goal of the decree was to increase the number of African-Americans to the point where it reflected the racial composition of the workforce in the city. In part, it provided that assignments, transfers, and promotions were to be based on appropriate criteria without regard to race. Now fast forward almost 30 years to 2006. That year, the Department promoted 11 lieutenants to captain. To prepare for the promotions, the Department screened, tested, and ranked each applicant. Instead of promoting the highest-ranked applicants, however, the Department promoted three African-Americans who ranked as low as 26th. Three white applicants, all of whom ranked in the top 10, brought suit pursuant to Title VII, § 1981, and § 1983. Magistrate Judge Lynch (S.D. Ind.) rejected the individual defendants' argument that they were entitled to qualified immunity because their actions were required by the consent decree and denied their motion for judgment on the pleadings. The defendants appeal.

In their opinion, Judges Flaum, Williams, and Sykes affirmed. The Court first confirmed its jurisdiction under the collateral-order doctrine. Even in the absence of a final judgment, a decision denying qualified immunity on an issue of law is immediately appealable. On the merits, the Court recited the familiar two questions raised by a qualified immunity analysis -- was a constitutional right violated and was the right sufficiently well-established to put the defendants on notice. The Court rejected the defendants' only argument that their race-based promotion decisions did not violate the Constitution -- that is, that the consent decree required them. Although it conceded that the consent order had general goals of increasing the number of African-American captains, the Court pointed to the several, very specific provisions of the order requiring race-neutral decisions. Other provisions of the consent decree (e.g., requiring sufficient African-American representation in an applicant pool) were designed to allow the department to reach its general goal without engaging in race-based promotions. The Court also rejected the defendants' only argument with respect to the "sufficiently well-established" prong because it also relied on the premise that the consent order required them to promote the African-Americans.

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KINGSTAD v. STATE BAR OF WISCONSIN (September 9, 2010)

Any person who wants to practice law in Wisconsin must join the Wisconsin State Bar and pay the compulsory dues it charges its members. Pursuant to Wisconsin Supreme Court rule, the Bar may fund activities that are related to its purposes but may not fund “political or ideological activities that are not reasonably intended for the purpose of regulating the legal profession or improving the quality of legal services.” In 2007, the State Bar proposed to use compulsory dues for a public image campaign. Several members objected. An arbitrator ruled in the Bar's favor. On appeal, Magistrate Judge Crocker upheld the finding. The objectors appeal.

In their opinion, Judges Bauer, Rovner, and Hamilton affirmed. The First Amendment is implicated when a state requires its attorneys to join a group and to provide financial support for that group. The Supreme Court has concluded that some mandatory associations are permissible because they serve legitimate governmental purposes. Mandatory state bars are such associations. There are limits, however, to the types of activities that can be funded by compulsory dues. The Court referred to its 1996 decision in Thiel. In that case, the Court found constitutional a Wisconsin rule that permitted the funding of non-political and non-ideological activities even if they were not germane to the “constitutional purposes” (that is, the purposes that justify the association’s existence under the First Amendment) of the association. In an alternative holding, the Court concluded that the activities at issue were germane to those purposes. Since Thiel, however, the Supreme Court has decided United Foods and the First Circuit has decided Romero. In United Foods, the Supreme Court held that mandatory support for an agricultural collective's generic advertising violated the First Amendment. Although the speech was not political or ideological, the Supreme Court concluded that it was not related to an otherwise proper goal that justified the collective’s existence. Likewise, in Romero, the First Circuit held that a bar association's mandatory life insurance plan violated the First Amendment. The court concluded that mandatory dues are permissible only for activities that were germane to the purposes that justified the association. In light of United Foods and Romero, the Court overruled one of the alternative holding in Thiel and concluded that the State Bar's mandatory dues must be reasonably related to one of its dual constitutional purposes -- regulating the profession or improving the quality of legal services. In applying that standard to the activities in question, the Court adopted a deferential, "reasonably related," standard of review. The Court concluded that the public image campaign expenditures were germane to improving the quality of legal services. The campaign was meant to improve lawyers' public image, which could lead to better client relationships, which could lead to higher-quality services.

Because the panel opinion overruled one of the alternative holdings of Thiel, it was circulated among active service judges. Although no judge favored rehearing en banc on that issue, Judge Sykes favored rehearing on the panel's application of the standard to the activities in question. She wrote separately, dissenting from the denial of rehearing en banc. She called the panel's approach "procedurally questionable" and "substantively flawed." With respect to procedure, Judge Sykes noted that the arbitrator never ruled on "germaneness" and that there is very little in the record on that issue. She suggested the remand requested by the objectors might be appropriate. With respect to substance, she took exception to the panel's conclusion that the campaign was germane. Not only was there no support in the record for that conclusion, what little there was in the record supported the opposite conclusion. The campaign was about marketing and in the interests of the lawyers, not the public.

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IN RE SPECHT (September 8, 2010)

Years ago, Eric Specht started a small business that he called Android Data Corporation. He registered "Android Data" as a trademark and registered the domain name “androiddata.com." Within a few years, however, he allowed the business to fold, the domain name registration to lapse, and the corporation to be dissolved. He must have had a change of heart several years later when Google came out with the Android operating system for cell phones. He tried to resurrect the corporation, he registered the domain name "android-data.com" –and then he sued Google and a number of other defendants for trademark infringement. The case was assigned to Judge Leinenweber. After the case had been pending for a year and as discovery was closing, he sought leave to add four defendants, including AT&T. Because his wife is on the AT&T board and together they own AT&T stock, Judge Leinenweber is never assigned a case in which AT&T is a party. Nevertheless, the judge decided to hear the motion. He denied the motion to amend and also refused to recuse himself. Specht petitioned for a writ of mandamus.

In their opinion, Chief Judge Easterbrook and Judges Kanne and Hamilton denied the petition. With respect to 28 U.S.C. §§ 455(b)(5) and 455(b)(6), the Court noted that disqualification depends on the relationship between a judge and a "party." Since AT&T is not a party, those sections do not require disqualification. The Court did conclude, however, that § 455(a)’s disqualification requirement when a judge's impartiality might be questioned comes into play. Although the Court expressly rejected the notion that the mere filing of the motion required recusal, it did conclude that a judge should not decide the merits of a motion if granting the motion would require his recusal. The proper procedure, said the Court, would have been for Judge Leinenweber to refer the underlying motion to another judge. If the uninterested judge denied the motion, Judge Leinenweber could continue to preside over the case. The Court nevertheless concluded that mandamus was unnecessary because it, as a disinterested panel, could decide the motion. Indeed, in the Court's view, granting the motion would be an abuse of discretion -- the case is a year old, discovery is closed, AT&T could have been named when the case was filed, and Google is the only necessary defendant for the relief requested.

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BROWN v. AUTOMOTIVE COMPONENTS HOLDINGS (September 8, 2010)

Letecia Brown was employed at Ford's Indianapolis plant from 1998 until her discharge in 2006. Her discharge resulted from her noncompliance with the FMLA leave policies in the Collective Bargaining Agreement (CBA). Under the CBA, an employee desiring leave: a) must submit a doctor's form before the leave’s expiration date, b) is deemed AWOL if she fails to do so, c) is considered AWOL if she fails to do so even if she seeks extension, and d) is sent a five day termination notice by registered mail if AWOL. Brown requested leave on August 11, 2006. Her doctor submitted the required form on August 21, indicating an August 28 leave expiration date. He also referred her to a psychiatrist. When Brown could not get an appointment with the psychiatrist until August 29, she asked her referring doctor to submit additional paperwork for an extension. He failed to do so – she failed to check. Brown's psychiatrist recommended that she extend her leave through September 15. Brown claims she advised Ford of the extension and was told to pick up a new form. Once her original leave expiration date (August 28) arrived without additional forms, Ford considered her AWOL and sent her a termination notice on August 31 by certified mail. Brown picked up a form from the clinic on September 6. She claims that she advised Ford that she could not return the completed form until September 11. On September 11, she found out that she had been fired. Her union filed a grievance but withdrew it because of her failure to follow the CBA procedures. Brown filed suit, alleging FMLA interference. Chief Judge Young (S.D. Ind.) granted summary judgment to the defendants. Brown appeals.

In their opinion, Circuit Judges Evans and Sykes and District Judge Der-Yeghiayan affirmed. The FMLA prohibits an employer from interfering with an employee's exercise of any rights under the Act. In order to state an interference claim, an employee must prove that she was eligible, that the employer was covered, that she was entitled to the leave, that she provide sufficient notice to her employer, and that her employer denied her FMLA benefits. At issue in the appeal was the notice element. The FMLA regulations in effect at the time addressed the notice requirement in the context of an unforeseeable extension of leave. The regulation provided that the employee should give notice as soon as practicable -- "within no more than one or two working days of learning of the need for leave." Here, Brown's doctor referred her to the psychiatrist on August 21. On that same day, she learned that she would not be able to see him until August 29, the day after her leave expired. She knew at that time that she would need an extension. The regulation required her to notify Ford within one or two days of August 21. She did not contact Ford until August 30. Brown fails to satisfy the notice element of an FMLA interference claim.

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MCEVOY v. IEI BARGE SERVICES (September 7, 2010)

IEI Barge Services (Services) is a bulk material handler with a facility on the banks of the Mississippi River in East Dubuque, Illinois. Among other materials, Services handles coal, receiving it from train cars and loading it onto river barges. Several of Services' neighbors, including Charles McEvoy, complained that the coal-handling activity releases coal dust which, in turn, is blown onto their properties. McEvoy filed suit in early 2006 under the citizen-suit provisions of the Clean Air Act. Other neighbors filed similar suits in early 2007. The theory of recovery in both suits is that Services' violation of two Illinois environmental regulations provided plaintiffs with a remedy under the Act. Judge Kapala (N.D. Ill.) granted summary judgment to Services in both cases. The plaintiffs appealed -- the appeals were consolidated.

In their opinion, Chief Judge Easterbrook and Judges Bauer and Wood affirmed. The Court turned its attention to the Act. The citizen-suit provision of the Act permits a private action against a person who is alleged to have violated "an emission standard or limitation under this chapter." Under the definition of that phrase, the enforceable standards and limitations are (as is relevant to the appeal): a) an "emission limitation, standard of performance or emission standard," and b) "any other standard, limitation, or schedule established under any permit issued pursuant to [another section of the Act] or under any applicable State implementation plan." In order to be enforceable under the Act, therefore, the Illinois regulations at issue must qualify under one of those two definitions. Before proceeding to an application of the Act to the regulations, the Court expressed its disagreement with the district court's interpretation of the second prong. The district court found that the phrase was ambiguous and concluded that the better reading was that it allowed enforcement only of a standard contained in a permit -- as opposed to a standard contained in a permit or a State implementation plan. The Court found that the statute was not ambiguous and that the natural reading allowed for enforcement of a standard contained in a permit or a State implementation plan. The first regulation the plaintiffs seek to enforce is entitled "Prohibition of Air Pollution" and, in the Court's words, says little more than "thou shall not pollute." The Court concluded that this "broad, hortatory statement" does not qualify as a standard or limitation enforceable under the Act. The second regulation, the "Fugitive Particulate Matter" regulation, presented a closer question. The regulation contained more specifics than the general prohibition, but fell far short of other highly specific standards contained in Illinois' regulations. The Court referred to some of the undefined words in the regulation: "visible," "an observer," "looking generally," "at a point beyond," etc. The Court noted that other Illinois regulations contain more specific metrics subject to objective measurement. The Fugitive Particulate Matter regulation does not. Finding no additional guidance or definitions to guide its interpretation, he Court concluded that the regulation could not be enforced through the Act.

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WILSON v. O'BRIEN (September 3, 2010)

Robert Wilson was convicted of attempted murder in state court. After that conviction was set aside, Wilson brought suit against the City of Chicago and others pursuant to § 1983. During discovery, the defendants attempted to depose Tyler Nims. While a law student, Nims had assisted Wilson with his defense. Nims asserted the attorney work-product privilege and refused to answer questions. After the district court ordered Nims to answer, he complied. Wilson (the party) and Nims (the nonparty) both appeal.

In their opinion, Chief Judge Easterbrook and Judges Kanne and Hamilton dismissed for lack of jurisdiction. The appeal raised interesting issues under the Cohen collateral-order doctrine in light of Mohawk Industries. After a short discussion of those issues, the Court tabled them. A necessary premise in considering an interlocutory appeal from an order concerning the disclosure of privileged information is that the person ordered to disclose has refused to so. Here, Nims complied with the district court's order -- his matter is moot. Likewise, with respect to Wilson, there is nothing the Court can do to protect the confidentiality of the already disclosed information. Wilson's opportunity to challenge the district court's decision will come after a final decision in the district court.

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GOODMAN v. NATIONAL SECURITY AGENCY (September 3, 2010)

Claudette Goodman was hired in August 2004 as a private security guard by the National Security Agency (National). Her initial pay was $8.25 an hour. National assigned her to an overnight shift at a housing complex. For family reasons, Goodman desired a daytime shift. She soon transferred to a different location on the more desirable dayshift. Although she was promoted to supervisor with a raise to $8.75, her employment was not without problems. National had difficulty with its payroll -- paying late, paying less than owed, bouncing checks, etc. In mid-2005, she began suspecting that National paid its male employees more than she. The owner denied it. In any event, in October 2005, she found another job at $10.00 an hour and quit her job at National. She brought suit against National under the Equal Pay Act and Title VII of the Civil Rights Act. Judge Norgle (N.D. Ill.) granted summary judgment to the defendants. Goodman appeals.

In their opinion, Judges Rovner, Sykes, and Tinder affirmed. The Court first addressed her retaliation claims under both statutes. Goodman relied on three acts in support of her claims -- that her hours were reduced, that she was demoted, and that she was reassigned. Unfortunately, the evidence did not fully support the accuracy of her claims. For example, her own testimony was that her hours did not change and that she was never actually reassigned (only threatened). To the extent it did, she failed to establish any harm. Her testimony suffered from inconsistencies and a lack of clarity and was insufficient to support a retaliation claim. Goodman's equal pay claims suffered from the same lack of clarity in the record. She offered the testimony of Michael Moore, a male supervisor, in support of the claim. Upon close examination, and adjusting for confusion about certain dates, the Court concluded that the evidence established that Goodman was in fact paid more than Moore. Obviously, that was fatal to her Equal Pay Act claim.

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FLYING J, INC. V. VAN HOLLEN (September 3, 2010)

A Wisconsin statute requires a minimum markup on gasoline sold in the state. The statute itself provides the formula with which to calculate the markup. The statute also authorizes a state agency to sue violators, issue cease and desist orders, and seek injunctions. It also provides for a private cause of action. Despite receiving over 1500 complaints of violations between 2003 and 2008, the agency did not prosecute one case. Flying J, a Wisconsin gasoline retailer, brought suit to enjoin the state from enforcing the minimum markup provisions. It alleged that the statute was preempted by the Sherman Act. Judge Randa (E.D. Wis.) agreed and issued a permanent injunction. When the state defendants elected not to appeal, the Wisconsin Petroleum Marketers and Convenience Store Association moved to intervene. The Court, in an earlier opinion (intheiropinion), reversed the District Court's denial of the intervention motion and accepted the Association as the appellant.

In their opinion, Judges Posner, Ripple, and Kanne reversed, dissolved the injunction, and remanded. In order to be preempted by the Sherman Act, a statute must mandate or authorize illegal conduct or place "irresistible pressure" to violate the law. Flying J's argument that the statute allows gasoline retailers to collude on prices is not enough -- the statute does not on its face mandate or authorize that conduct. Furthermore, there was no evidence in the record of actual collusion. The Court thought the outcome controlled by the Supreme Court's decision in Fisher. Flying J also argued that the statute was preempted as a "hybrid" statute (in which a government enforces prices set at the discretion of private parties). The Court concluded that the statute is not a hybrid statute. In hybrid statute cases, private parties -- not the state -- set the prices. Here, the state sets the minimum price. The fact that the statute includes a private cause of action and a “meet competition” exception does not make it a hybrid.

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CHAPIN v. FORT-ROHR MOTORS (September 3, 2010)

Trent Chapin is a used-car salesman. For years, he has worked on and off for Larry Kruse at several different dealerships owned by Bob Rohrman. In early 2004, Kruse hired him at Rohrman's Mid-States Motors in Fort Wayne, Indiana. Within weeks, however, Kruse was replaced by a Pakistani Muslim. The new manager fired Chapin within a month. In June, Kruse became the manager of Rohrman's newly opened Fort-Rohr dealership, also in Fort Wayne. He hired Chapin again as a used-car salesman. Chapin filed an EEOC charge in February of the following year. He alleged that Mid-States had discriminated against him on the basis of race. When Kruse found out about it, he was very upset. He met with Chapin and made it very clear to him that he needed to withdraw the EEOC charge if he wanted to keep his job. Although Chapin indicated at the meeting that he would withdraw the charge, he did not -- and he did not return to work. Kruse tried to contact Chapin on several occasions after the meeting. They finally met again in March. Kruse made it clear at that meeting that he had not intended to fire Chapin and that he still had a job. Chapin told him that he would return to work when he was finished with a painting project. The dealership followed up that meeting with several letters to Chapin stating that he was still employed and was expected to be at work. Chapin filed suit under Title VII, alleging racial discrimination against Mid-States and retaliation against Fort-Rohr. A jury found against him on his discrimination claim but found in his favor on the retaliation claim, awarding $1.1 million in compensatory and punitive damages. Fort-Rohr appeals.

In their opinion, Judges Flaum, Williams, and Sykes reversed and remanded. Title VII makes it illegal for an employer to take an adverse employment action against an employee for filing an unfair employment charge. The Court addressed both of Chapin's “adverse employment action” theories -- that he was actually discharged or that he was constructively discharged. On the former, the Court concluded that no rational juror could have found that Chapin was actually discharged at the first meeting with Kruse. The Court conceded that the exchange at the first meeting, in a vacuum, could support an argument for discharge, particularly if he filed suit the next day. Kruse was angry, raised his voice, and told Chapin that he would not have a job unless he withdrew the charge (which Chapin did not). However, the Court emphasized that the question must be addressed not in isolation but in the context of all subsequent interaction. All of the dealership's conduct after that short meeting is inconsistent with an actual discharge. In fact, Chapin's own testimony is that he was not fired at that meeting but that he would have been fired had he returned without withdrawing the charge. There was no actual discharge. With respect to the constructive discharge argument, the Court again concluded that no reasonable juror could find for Chapin. Two forms of constructive discharge are recognized in this Circuit and both require intolerable working conditions. In the first, an employee resigns because of discriminatory harassment -- that does not apply here. In the second, an employer acts in such a way as to communicate to a reasonable employee that he or she will be terminated. Again, Chapin may have had such a belief immediately after the first meeting but such a belief would have been corrected almost immediately in response to subsequent events and communications. Chapin simply decided not to return to work -- the Court refused to speculate on what would have happened had he decided otherwise.

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION v. HYATT (September 3, 2010)

In June and August of 2008, the SEC issued two third-party subpoenas to Brian Hollnagel and BCI Aircraft Leasing (BCI) in connection with other federal litigation. Over several weeks, BCI produced a significant amount of material. The SEC found problems with each production and requested additional information. The SEC ultimately became frustrated with what it believed to be inadequate compliance. On August 28, it filed a motion for a rule to show cause why BCI should not be held in contempt. The notice of motion indicated that the SEC would appear in court on September 3 and "seek a hearing date" on its motion. On September 3, BCI did not appear and the SEC asked the court to order a complete and proper production, to hold BCI in contempt, and to award attorney's fees. The court did so. It then issued two orders. The first indicated that the matter was continued to September 10 and asked for BCI's response to the motion by September 5. The second order was prepared by the SEC -- it held BCI in contempt, it ordered a full and complete production by September 5, it imposed a $1000 per day fine for noncompliance, and it awarded attorneys fees. The court vacated its first order the following day. Although BCI filed a substantive response, the court struck it as moot. Eventually, Judge Lindberg (N.D. Ill.) found that BCI had substantially complied with the subpoenas and rescinded the fine. He did not, however, vacate the contempt finding or the award of fees. BCI appeals.

In their opinion, Circuit Judges Posner and Sykes and District Judge Van Bokkelen vacated the contempt order. The Court first rejected BCI's argument that the subpoenas, which were issued by the SEC attorney, were not court orders and could not therefore be the basis for a contempt finding. Rule 45 of the Federal Rules of Civil Procedure is on point. Rule 45(e) specifically states that a court may hold a person in contempt for failure to comply with a subpoena and does not distinguish between a subpoena issued by a court or one prepared by an attorney. The Advisory Committee Notes make the point even more clearly. The notes, however, also make it clear that a court's contempt power should be used more sparingly and with greater attention to the non-party's rights when the subpoena is issued by an attorney. Although BCI did not exercise its rights to object to or move to quash the subpoenas, it was certainly entitled to adequate notice of an attempt to hold it in contempt. At a minimum, the SEC was required to give notice of the place and time for a hearing. Here, the Court noted that the SEC could have simply moved for a finding of contempt and provided notice to BCI of the time and place when it would appear on its motion. But it did not. Instead it used the obsolete and unnecessary “motion for rule to show cause” procedure. Under that procedure, the first appearance of the parties seeks only a preliminary order directing the alleged contemnor to "show cause" why it should not be held in contempt. The Court concluded that the SEC, having chosen to proceed in a certain manner, should be held to the traditional practice associated with that procedure. BCI did not have adequate notice that a hearing on contempt was to be held on September 3.

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CARLSON v. BUKOVIC (September 2, 2010)

June Carlson and her adult handicapped son Paul were shopping at their local Walmart store when Paul scratched himself on a fire hose box. They reported the incident to store personnel and were in the process of completing some forms when things got heated. The store manager eventually felt threatened and the police were called. Officer Bukovic interviewed the manager and the Carlsons. June Carlson, a woman in her 80s, became very upset, raised her voice, and accused the manager of lying -- but refused to cooperate with the Officer's interview. The manager told Officer Bukovic that he wanted Ms. Carlson to leave the store. After Ms. Carlson refused several requests to leave, Officer Bukovic gently placed his hands on her arm to guide her out. She began screaming and flailing about. Eventually, she calmed down and left the store -- and sued. She asserted a § 1983 Monell claim against the City of Darien and a Fourth Amendment excessive force claim against Bukovic. Magistrate Judge Nolan (N.D. Ill.) granted the City's summary judgment motion on the Monell claim. The excessive force claim was tried to a jury, which found that no “seizure” had occured. Carlson appeals.

In their opinion, Judges Ripple, Manion, and Sykes affirmed. The principal issue before the Court was Carlson's argument that the mere touching by Bukovic was a seizure as a matter of law and "per se" unreasonable. The Court rejected the argument. The Fourth Amendment inquiry has two prongs -- whether there was a seizure and, if so, whether it was unreasonable. There are a number of factors that go into the "totality of the circumstances" test to determine whether there was a seizure. Physical contact is one of those factors. But so are the number of officers, the display of a weapon, and the tone of voice. The Supreme Court has held that the purpose of the contact is relevant in physical contact cases. The mere fact that there is a touching or physical contact does not automatically create a seizure. The Court concluded that the district court properly submitted the question to the jury. Given the Court's disposition of the excessive force claim, it also rejected Carlson’s appeal of the Monell claim. There can be no municipal Monell liability without an underlying constitutional violation.

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GOLDHAMER v. NAGODE (September 2, 2010)

Don Goldhamer and Robin Schirmer participated in a peaceful demonstration near a military recruitment booth during the Taste of Chicago festival in the summer of 2006. They expressed their opposition to military recruitment by handing out fliers and speaking to passers-by. The police asked them to relocate to a designated area. When they refused, the police ordered them to leave. Again they refused. They were arrested and charged with a city ordinance violation. The ordinance makes it unlawful to fail to disperse when ordered to do so -- but only in a situation where "three or more persons are committing acts of disorderly conduct in the immediate vicinity, which acts are likely to cause substantial harm.” A state court ultimately dismissed the charges for failure to prosecute. Goldhamer and Schirmer brought suit under § 1983, alleging that the ordinance was facially invalid under the First Amendment and that it was unconstitutionally vague. They sought an injunction and damages. Judge Grady (N.D. Ill.) granted plaintiffs summary judgment on liability and permanently enjoined enforcement of the ordinance. The City appeals.

In their opinion, Chief Judge Easterbrook and Judges Bauer and Hamilton vacated and remanded. The Court first noted that, although the district court had not disposed of all claims, it had limited appellate jurisdiction under § 1292(a)(1). Before reaching the merits, the Court addressed the plaintiffs' standing on their request for injunctive relief. Among other things, they must show that a favorable decision from the court will prevent or redress the injury. The Court found that element absent. There is no evidence in the record of any disorderly conduct in their vicinity -- an essential element of the offense for which they were arrested. Given that their conduct was clearly outside the scope of the ordinance, the requested injunction is unlikely to prevent future injury. The Court concluded that this misuse of the ordinance by the Chicago police does not provide a basis on which a federal court should examine the constitutionality of the law. The Court added that plaintiffs of course have standing to challenge their arrest and seek money damages.

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BODUM USA v. LA CAFETIERE, INC. (September 2, 2010)

In 1991, Bodum Holding purchased the stock of a French company whose principal product was a french-press coffeemaker sold under the name “Chambord.” One of the principal investors in the French company also owned Household, a British company that sold a very similar looking French-press coffeemaker under the “La Cafetiere” name. The parties negotiated over Household's ability to continue selling its coffeemaker after the sale. An early draft of the sales agreement allowed it to sell the La Cafetiere only in England. The later, signed version allowed it to sell the La Cafetiere anywhere in the world except France. In 2006, Household began distributing the La Cafetiere in the United States. Bodum filed suit under state and federal law. Judge Kennelly (N.D. Ill.) granted summary judgment to Household. Bodum appeals.

In their opinion, Chief Judge Easterbrook and Judges Posner (concurring) and Wood (concurring) affirmed. The only issue the Court addressed was the meaning of the contract, which was governed by French law. Although FRCP 44.1 allows the use of expert testimony as an aid to the interpretation of foreign law, the Court criticized the practice. Instead, it noted its preference for treatises. Here, the Court relied on the plain language of the contract and its "straightforward" negotiation history in concluding that Household was within its rights to sell its product in the United States. It rejected Bodum's argument that a provision in the French Civil Code required a trial to determine the actual intent of the parties.

Judge Posner agreed with the disposition on the merits but wrote a separate concurrence even more critical than Chief Judge Easterbrook of the practice of using experts to aid the court in foreign law interpretation. In his judgment, courts should rarely rely on expert testimony for the meaning of foreign law. Judge Posner has expressed this view in the past, as well (see his opinion in Sunstar, Inc. v. Alberto-Culver Co. - and my post).

Judge Wood also agreed with the disposition of the case on the merits and also wrote separately on the subject of Rule 44.1. Judge Wood, however, disagreed with the harsh criticism from her colleagues. In her judgment, experts are frequently necessary to ensure that a district court judge completely understands the nuances of foreign law.

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WEBER v. UNIVERSITIES RESEARCH ASSOCIATION (September 2, 2010)

Katherine Weber had been employed at Universities Research Association (URA) for almost twenty years when she received a negative performance review. She believed the review was unfair and filed a grievance. The grievance was ultimately resolved in her favor and the negative review was removed from her record. Weber claims that a number of bad things began to happen to her after the grievance, ultimately including the elimination of her position in early 2004. She accepted another position with the organization under a new supervisor. Weber had difficulty with her new supervisor from the beginning. She complained that she was the victim of retaliation and that her new supervisor treated her differently than other employees. Her supervisor complained that she was not getting her work completed and became suspicious of her computer usage. URA decided to monitor her Internet usage. The results of its trace showed that Weber spent more than 16 hours in one workweek visiting websites unrelated to her work. Her usage included accessing dog-related sites and her personal e-mail accounts in connection with her dog training business. URA terminated Weber's employment for violating its policies: a) requiring disclosure and authorization of outside employment and b) prohibiting the use of URA computer equipment in connection with outside employment. Weber brought suit pursuant to Title VII for gender discrimination and retaliation. Judge Andersen (N.D. Ill.) granted summary judgment to URA. Weber appeals.

In their opinion, Judges Bauer, Kanne, and Tinder affirmed. The Court first concluded that Weber waived both claims under the direct method of proof by not sufficiently developing them in the district court. Since Weber does not challenge the district court's decision with respect to the retaliation claim under the indirect method, the only other issue before the Court was the discrimination claim under the indirect method. Weber attempted to meet the "similarly situated" element of her prima facie case by identifying a number of male co-workers who had unauthorized outside employment, who accessed the Internet for personal and outside employment use, and who accessed the Internet to view pornography. The Court concluded that Weber did not meet the "similarly situated" element. To meet that requirement, she must identify employees who engaged in similar conduct in the absence of circumstances that would distinguish their conduct from hers. The Court acknowledged that she identified multiple instances of policy violations but distinguished those violators. Weber presented no evidence that the violators had trouble finishing their work or that any of them violated a company policy "with the same reckless abandon" as Weber.

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BADGER CATHOLIC, INC. v. WALSH (September 1, 2010)

Badger Catholic is an approved and registered student organization at the University of Wisconsin. As such, it is eligible to apply for and receive money from the University. The monies come from a University account that is funded by a fee charged to every university student. The Supreme Court approved the University's practice (University of Wisconsin v. Southworth) because it was a neutral, forum-creating program that distributed funds without regard to viewpoint. The University rejected Badger Catholic's request for funds for six different programs. The denial was based on the University's practice of not funding programs that involve "worship, proselytizing, or religious instruction." Judge Adelman (W.D. Wis.) concluded that funding such activity would not violate the Establishment Clause and entered a declaratory judgment requiring the University to fund Badger Catholic on the same basis it funds other organizations. The University appeals -- Badger Catholic cross-appeals.

In their opinion, Chief Judge Easterbrook and Judges Evans and Williams (dissenting) affirmed. The Court cited two Supreme Court cases (Widmar and Rosenberger) in support of its conclusion that the district court was correct in its decision that funding the programs would not violate the Establishment Clause. The University also argued that it was permitted to withhold the funds even if the funding did not violate the First Amendment. The Court distinguished the University's reliance on Locke (which permitted a state to exclude ministry study from its scholarship program). The decision in Locke was a form of government speech -- here, the University created a public forum for student speech. Having created the public forum, it must not discriminate among the speakers within the scope of the forum. The University must fund the rejected programs if similar, secular programs are funded. The Court also rejected Badger Catholic's cross-appeal: a) damages are not available against the University because it is not a "person" under § 1983, b) damages are not available against the individual defendants because of official immunity, c) damages are not available under state law because Badger Catholic failed to comply with statutory notice requirements, and d) the district court did not abuse its discretion in issuing a declaratory judgment instead of an injunction.

Judge Williams dissented. She phrased the issue as whether the University's rejection of Badger Catholic's programs was disallowing a particular view on a permissible topic (viewpoint discrimination -- unconstitutional) or disallowing any view on a particular topic (content discrimination -- constitutional). Her conclusion was that the University was engaged in the latter. The Constitution allows it to decide not to fund purely religious activity. It gets around any problem in defining the scope of that restriction by allowing the student organizations themselves to identify purely religious activities.

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WICKENS v. SHELL OIL CO. (August 31, 2010)

Daniel and Pamela Wickens owned a small parcel of land in central Indiana that had previously been the site of a Shell gasoline station. During preparations for the sale of the parcel, they discovered that the soils were contaminated. Their attorney, Mark Shere, began negotiations with Shell -- under the Indiana Underground Storage Tank Act (the “Act”), a person who takes steps to remedy soil contamination caused by an underground storage tank may be reimbursed by the owner and may recover his attorneys' fees if he brings a successful suit. When a neighbor's property (also the site of a former gasoline station -- but not owned by Shell) was also found to be contaminated, the parties fought over the source and responsibility for the contamination. The Wickenses brought suit in early 2005. The district court denied Shell's summary judgment motion, concluding that it probably bore full responsibility for the contamination. Although the Wickenses continued to control the investigation and rack up remediation costs and attorneys' fees, the parties could not seem to reach a settlement. The court adopted a three month freeze on the parties' liability for each other's fees and costs in early 2007 in an attempt to foster a resolution. She also instructed the parties to select and retain an independent consultant to investigate the properties. Notwithstanding the court's order, the parties continued to incur substantial fees and costs during and after the freeze. The parties finally reached an agreement -- Shell purchased the property, made a payment for property damages, and agreed that the Wickenses were entitled to their costs and fees. They left the calculation up to the court. Judge Barker (S.D. Ind.) awarded all of the Wickenses' costs and fees up to the point of her freeze order, after which she disallowed all costs (with the exception of some corrective action costs pursuant to a state work plan) and fees. On post-judgment motions, the court a) deducted the amount of fees billed as attorney services by Shere’s wife, a non-attorney, and b) admonished Shere for concealing the fact that his fees were largely paid by an insurance company throughout the litigation but granted Shell no relief. Shell appeals. Shere (after being allowed to appear as a real party in interest) cross-appeals.

In their opinion, Circuit Judges Bauer and Wood and District Judge Kennelly affirmed in part and reversed and remanded in part. The only issues on appeal relates to the award of expert costs and attorneys' fees. The Court first concluded that the lower court correctly applied a statutory purpose test for calculating a fee award under the Act. Second, the Court ruled that the lower court did not abuse its discretion in concluding that the statutory purpose was satisfied as of January 2007. The Court rejected Shell's suggestions that an earlier date was appropriate and the Wickenses's suggestions that a later date was required. Next, the Court upheld (with a small clerical error reversed and remanded) the deduction for fees incurred by Shere’s wife. There was nothing wrong with the her time entries. They could have been billed as non-attorney time -- but were improperly billed as attorney time. Finally, the Court concluded that the district court did not clearly err in its award of expert costs after January 2007. On Shere’s cross-appeal, the Court a) found no abuse of discretion in denying prejudgment interest, b) concluded that Shell suffered no prejudice from Shere’s insurance concealment and found no error in the court's denial of relief, and c) refused to consider Shere’s complaint that the district court was unduly critical of his litigation conduct.

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CENTRAL STATES SOUTHEAST AND SOUTHWEST AREAS PENSION FUND v. O'NEILL BROS. TRANSFER & STORAGE (August 31, 2010)

Until 2007, O’Neill Bros. Transfer & Storage took part in a multi-employer pension fund administered by the Central States Southeast and Southwest Areas Pension Fund (the “Fund”). A multi-employer fund is a pension plan in which numerous employers make contributions to a single fund on behalf of their employees. ERISA requires adequate funding levels and withdrawal liability payments upon the withdrawal of an employer from the plan. When O'Neill advised the Fund that it was preparing to liquidate, the Fund considered it a withdrawal, deemed O'Neill in default, and demanded immediate payment. The Fund filed a complaint several months later seeking the entire amount of the payment. The Court ordered the Fund to propose a payment schedule, which it did. O'Neill never accepted the schedule. Judge Der-Yeghiayan (N.D. Ill.) granted summary judgment to the Fund for a lump sum payment of the entire amount of liability. O'Neill appeals.

In their opinion, Judges Bauer, Ripple, and Kanne affirmed. The Court reviewed relevant statutory and plan provisions:

•  the plan must calculate withdrawal liability and provide an installment payment plan
•  the employer may challenge but must make the payments during the arbitration process
•  the plan may demand immediate payment in the event of default (defined as the failure to make payment if not cured or any event which the plan defines as indicating a substantial likelihood that the employer will be unable to pay)
• under the "substantial likelihood" default, a plan may demand full payment of withdrawal liability
• the Fund adopted a rule that included an employer's insolvency as a default event under the "substantial likelihood" clause.

The issue before the Court was whether the employer must immediately pay, notwithstanding arbitration, its entire withdrawal liability when demanded under the substantial likelihood default clause. The Pension Benefit Guarantee Corporation (PBGC) has promulgated a regulation that a default under the failure to pay paragraph does not take effect until 61 days after the arbitrator makes its decision. The substantial likelihood clause does not contain the same language as the failure to pay clause relied upon by the PBGC in reaching that conclusion. The PBGC is the agency charged with the administration of the provision -- the Court found that interpretation a reasonable one and found it worthy of deference. It therefore concluded that an accelerated default payment under the substantial likelihood clause is not deferred pending arbitration.

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WOLFE v. SCHAEFER (August 31, 2010)

Mervin Wolfe ran an unsuccessful campaign for Cumberland County State's Attorney in 2008 against Barry Schaefer, the incumbent. Wolfe brought suit against Schaefer and others (with whom he had a long history) pursuant to § 1983. He alleges that the defendants violated his Fourth and Fourteenth Amendment rights when they published the fact that he was under investigation by certain state agencies as part of their attempt to defeat his campaign. Judge Scott (C.D. Ill.) dismissed the complaint. Wolfe appeals.

In their opinion, Judges Posner, Wood, and Hamilton affirmed. The Court noted that the state law required the investigations be kept confidential. But Wolfe did not allege a violation of state law -- he alleged that the state law granted him a constitutional right. The Court recognized that a state law can create a liberty or property interest protected by the due process clause. There is also a common law breach of privacy tort, including one that protects an unreasonable interference with one's private life. The issue for the Court was whether any of this rose to the level of a protected property or liberty interest. The Supreme Court has not held that disclosure of private information violates the due process clause. In Whalen, it suggested that the disclosure of certain private information might do so -- but in Paul v. Davis held that one's reputation is not constitutionally protected. The courts of appeals have used Whalen to recognize certain constitutionally protected privacy rights. Although the Court recognized that certain situations might give rise to a constitutional right to privacy, it concluded that Wolfe's case was at the other end of the continuum. Information regarding the investigations of a candidate for public office is a matter of significant public interest. Wolfe's complaint was properly dismissed.

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FORREST v. PRINE  (August 31, 2010)

In responding to a 911 call, the Rock Island County Sheriff's police came upon Roger Forrest. Forrest was uncooperative and belligerent. After he struck an officer, the police employed a taser several times to subdue him. He was arrested and charged with a felony. Pursuant to County procedure, he was subject to a strip search. Forrest refused to cooperate, instead pacing back and forth in a small room, shouting obscenities and insulting the officers present. One of those officers, Michael Prine, warned him on several occasions that he would use a taser again if Forrest did not comply with the search. Eventually, he did use the taser. The testimony differs on this point. Prine and other officers testified that he aimed the taser at Forrest's back -- Forrest testified that Prine aimed at his face. In any event, one of the darts did hit his face. He fell and suffered a head injury. Forrest brought an action pursuant to § 1983 against Officer Prine. He complained of the use of excessive force in violation of the Fourth and Fourteenth Amendments. Magistrate Judge Gorman (C.D. Ill.) granted summary judgment to Prine. Forrest appeals.

In their opinion, Judges Posner, Ripple, and Kanne affirmed. The Court first commented on the basis for Forrest's claim. The Fourth Amendment grants certain rights to be free from excessive force but applies only in the search and seizure context. The Court admitted that it had not precisely defined the temporal contours of Fourth Amendment protection but concluded that allegations arising in the pretrial detention process, such as Forrest's, are clearly outside its temporal bounds. On the other end of the spectrum, the Eighth Amendment protects sentenced prisoners from claims of unnecessary or excessive force or punishment. Forrest's claims arise in the pretrial detainee context and are governed by the due process clause of the Fourteenth Amendment. In analyzing Forrest's claim, the Court applied an Eighth Amendment approach. The due process clause provides at least as much (and maybe more -- but Forrest did not argue so) protection as the Eighth Amendment. The test under the Eighth Amendment is whether the force is "unnecessary and wanton infliction of pain." The relevant factors include the need for and amount of force, the existence of a threat, any effort to use less force, and the extent of any injury. Applying that test here, the Court concluded that no reasonable factfinder could find Prine's use of force impermissible. Forrest was a large man in a small space, pacing and shouting, threatening and swearing, clenching his fists and refusing to follow orders. Prine warned him several times that he would use the taser if Forrest did not follow instructions. Finally, the Court refused Forrest's invitation to infer some malicious intent from the mere fact that one dart struck him in the face. There is simply no evidence to support such an inference.

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SIEFERT v. ALEXANDER (August 31, 2010)

On June 14, 2010, a panel of the Court issued its opinion in Siefert v. Alexander (opinion here – intheiropinion here). In a 2-1 decision, the majority applied a balancing test in upholding a Wisconsin prohibition on judges or judicial candidates from publicly endorsing other partisan candidates. Siefert petitioned for Rehearing En Banc.

In their opinion, the Court denied the petition.

Judge Rovner (joined by Judges Wood, Williams, and Hamilton) dissented from the denial. Judge Rovner stated that the Supreme Court and every other circuit court that has addressed the First Amendment rights of judges have done so by applying a strict scrutiny test. She disagreed with the application of the balancing test by the majority and favored rehearing.
 

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HAYES LEMMERZ INTERNATIONAL v. ACE AMERICAN INSURANCE CO. (August 31, 2010)

An explosion at a plant owned by Hayes Lemmerz International-Huntington (LMIH) , a subsidiary of Hayes Lemmerz International (HLI), injured one employee and killed another. The injured employee and the widow of the deceased employee filed workers' compensation claims against both HLI and HLIH as employers and recovered. They then brought a tort suit against the same two companies. The suit did not identify either defendant as an employer. Rather, it alleged that the defendants owned and operated the plant and failed to exercise reasonable care. Apparently, they did not identify the defendants as employers because the exclusive remedy against an employer for a workplace injury is a workers’ compensation claim. HLI notified ACE American Insurance Co., its employer liability policy carrier. ACE declined to take over the defense and offered to pay only half the combined litigation expenses. HLI incurred over $250,000 in defense costs attempting to convince the state court that it was not the employer -- and therefore not liable. Ironically, it eventually discovered that Indiana, by statute, treats a parent and its subsidiaries as joint employers, for workers' compensation purposes, of each other's employees. The suit against HLI was therefore dismissed with prejudice because of the workers' compensation bar. HLI brought an action against ACE for recovery of its attorneys' fees. Chief Judge Simon (N.D. Ind.) dismissed the complaint. HLI appeals.

In their opinion, Judges Bauer, Posner, and Flaum affirmed. Under Indiana law, the duty to defend is determined by the nature of the complaint. The "nature of the complaint" includes not only the specific allegations contained therein but also facts readily ascertainable by the insurer. Here, although neither HLI nor HLIH were identified as employers in the complaint, the Indiana statute made their status as such readily ascertainable. The fact that the complaint lacked merit is irrelevant -- an insured deserves a defense to meritless complaints as well as meritorious ones. A duty to defend (or reimburse) therefore existed. However, that duty requires reimbursement only of reasonable costs of defense. HLI's failure to appreciate the existence and significance of the Indiana statute (HLI has filed a malpractice action against its lawyers) led the Court to conclude that the defense costs were unreasonable and unrecoverable. The Court also rejected HLI's argument that ACE's duty to defend included a duty to advise it about the existence of the statute. ACE had no duty to provide legal advice.

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MEYERS v. NATIONAL RAILROAD PASSENGER CORP. (AMTRAK)(August 30, 2010)

Greg Meyers was an Amtrak pipe fitter for years. It was a difficult job -- requiring lifting, twisting, reaching, etc., frequently in confined spaces. Meyers' size (approximately 350 pounds) made the job even more difficult. He started experiencing problems in 2004. He was referred to Dr. Rosseau, a neurosurgeon, who diagnosed him with cervical spondylosis and carpal tunnel syndrome. Rosseau performed carpal tunnel surgery in 2004 and back surgery in 2008. Dr. Tonino, an orthopedic surgeon, operated on his right shoulder in 2007. Meyers brought suit against Amtrak under the Federal Employers' Liability Act ("FELA"). He alleged that his injuries were caused by Amtrak's failure to use ordinary care. He relied on the Rosseau and Tonino expert reports and a report by his expert ergonomist. Judge Der-Yeghiayan (N.D. Ill.) granted partial summary judgment to Amtrak on statute of limitations grounds but then struck the reports of both doctors and the ergonomist. Without those reports and testimony, Meyers was unable to establish the elements of the offense. The court granted full summary judgment. Meyers appeals.

In their opinion, Judges Kanne, Williams, Hamilton affirmed. The Court addressed only the doctor expert issue. It stated that a party offering an expert witness who was retained to provide expert testimony in a case must comply with the requirements of Rule 26(a)(2). Those requirements include disclosing the bases of the expert's opinions and the reasons for them, which Meyers did not. The Court noted that it had never ruled on whether a treating physician is required to comply with those disclosure requirements if the subject of the opinion was not determined at the time of treatment. It concluded that a treating physician should be held to the same disclosure requirement if the physician is offered for testimony regarding the cause of injury and that testimony is based on a conclusion that was not made at the time of treatment. The testimony of Meyers' two doctors fits that definition and was properly excluded. Without those reports, there is no evidence of causation and summary judgment was appropriate.

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RUNYON v. APPLIED EXTRUSION TECHNOLOGIES (August 30, 2010)

Timothy Runyon began working at Applied Extrusion Technologies' (AET) Terre Haute, Indiana plant in 2005 at the age of 45. A few months later, the company hired Troy Corbett, about fifteen years his junior. The two men worked for the same supervisor and had the same job title. Runyon had two fairly serious and heated altercations with coworkers in his first seven months on the job. Then, in February of 2006, Runyon and Corbett got into a heated argument that escalated into a fight. Both men were suspended for three days and instructed to write letters of apology. Runyon's letter focused more on his desire to remain employed and did not address the fight or issue an apology until its fourth and final paragraph. Corbett's letter, on the other hand, opened with an apology and expressed his sincere regret. Because of the earlier two incidents and the content of the letter, AET fired Runyon. It did not fire Corbett. Runyon brought an action against the company based on the Age Discrimination in Employment Act ("ADEA"). Judge McKinney (S.D. Ind.) granted judgment as a matter of law to AET at the close of Runyon's case-in-chief. Runyon appeals.

In their opinion, Judges Posner, Flaum, and Wood affirmed. The Court stated that Runyon was wrong in approaching the appeal as if it were a McDonnell Douglas indirect proof analysis. That burden-shifting approach is only appropriate at summary judgment, not after a plaintiff has had an opportunity to present his entire case at trial. The question at that time is whether he presented enough evidence to allow a rational factfinder to rule in his favor. On that question, Runyon must fail. He presented insufficient evidence to carry his burden that his age rather than his behavior was the real reason for his discharge.

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METAVANTE CORP. v. EMIGRANT SAVINGS BANK (August 30, 2010)

Emigrant Savings Bank wanted to expand its operations by launching an on-line bank. In early 2004, Emigrant met with Metavante Corp. The Metavante team presented its system, emphasizing its ability to service a great number of accounts. The Emigrant team knew that certain capabilities were still being developed and that the system lacked some desired traits. Nevertheless, Metavante submitted a proposal referencing existing clients and indicated that its product was in current use. It even identified Capital One as a client reference. The parties negotiated an agreement over the next several months and signed it in August. Under the agreement, Metavante was to provide electronic banking and funds transfer services. Metavante warranted that it would provide those services in a "commercially reasonable manner." Certain services were exempt from the warranty because they contained their own service-level target measurements. Finally, the agreement allowed termination for cause (but with broad cure rights), termination for convenience (for a fee), and termination for convenience and migrating the process to an in-house solution (with a lower termination fee). The program went live in early 2005. It had many flaws – for example, it could not ensure that a customer had sufficient funds to make a particular transfer, it generated error messages, it could not complete online applications, and it failed to process some transactions. On the other hand, Emigrant landed 250,000 new accounts and over $6 billion in deposits. It advertised its bank as "the most successful" bank of its type. Metavante brought suit against Emigrant in September 2005 and gave notice of termination for non-payment. Emigrant objected but made the payments. Several months later, Metavante again gave notice of termination for nonpayment. Emigrant countered that it was terminating for cause for Metavante 's "flawed and inadequate" performance. Metavante amended its complaint to add breach of contract claims. Emigrant counterclaimed for fraud in the inducement. After a bench trial, Judge Stadtmueller (E.D. Wis.) ruled that Metavante had not materially breached the contract but awarded the lower termination fee, finding that Emigrant had migrated the system to an in-house solution. The court also awarded approximately $10 million in attorneys' fees to Metavante. Emigrant appeals.

In their opinion, Judges Ripple, Manion, and Tinder affirmed. First, although criticizing the district court for its oral decision and verbatim adoption of many of Metavante 's proposed findings of fact, the Court declined Emigrant's invitation to apply a less deferential standard of review. Second, although criticizing the district court for its inadequate reliability determination with respect to Metavante's expert, its de novo review led it to conclude that the testimony was relevant and reliable. Third, with respect to whether Metavante breached its "commercially reasonable" warranty, the Court concluded that the district court did not err in considering the venture's success as probative evidence. Although a venture's success may not conclusively establish the commercial reasonableness of a party's performance, a court is certainly entitled to consider it. Here, the district court considered it as one factor, albeit a significant one, of many. Fourth, the Court found no clear error in the district court's finding of commercial reasonableness. The Court specifically cited the working relationship between the parties, the fact that both parties understood they were dealing with a new technology, and the fact that Metavante undertook diligent efforts to correct problems when they occurred. Fifth, the Court concluded that the record supported the district court's conclusion that there was no breach of the implied duty of good faith and fair dealing. Sixth, with respect to Emigrant's fraud claims, the Court found that Emigrant failed to prove reliance or falsity. The Court concluded that it was unreasonable for Emigrant to rely on any of the early "sales pitch" statements, given that these two sophisticated businesses proceeded to negotiate over several months a complex arms-length transaction. The negotiation process and the contract itself made the expectations and capabilities of the parties very clear -- Emigrant may not rely on any earlier inconsistent statements. With respect to falsity, the Court concluded that the district court did not err in its finding that none of the representations at issue amounted to fraud. Finally, the Court turned to the fee award. Several issues were presented related to the fee award. The fee shifting provision in the contract provided that the "prevailing party" is entitled to fees. The Court concluded that Emigrant's partial success in the court's awarding of the $3.8 million lower termination fee instead of the $20.7 million higher termination fee did not make it a prevailing party on that issue and entitle it to fees. The Court also concluded that the submission of redacted bills was sufficient under Medcom. Although a request for fees must be reasonable under a fee shifting provision, the Court noted that market considerations normally render unnecessary line by line scrutiny of individual time entries. The district court acted within its discretion in awarding the fees.

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HILL v. POTTER (August 30, 2010)

Carla Hill has been an employee of the United States Postal Service in Hazel Crest, Illinois for several years. In the early 2000s, she filed a number of EEO complaints against her supervisors for discrimination. In late 2002, Hill hurt her back in a work related injury and went on "limited duty" status. Limited duty status employees are paid for a full day's work even if no qualifying work is available. Just as her limited duty status period was about to end, Hill claimed that she reinjured her back and reapplied. Her supervisor, Patrick Kavanaugh, wrote a letter to Dale Schultz of the Office of Workers' Compensation Programs. He communicated his belief that Hill’s injury was not as serious as she claimed. Schultz put Hill on "light duty" status. Light duty status employees are not guaranteed a full day's pay if qualifying work is not available. Hill lost 618 hours of pay while on light duty status -- even while other employees worked in excess of 800 hours of overtime. Hill, who was a letter carrier, also wanted a position as a window clerk. She submitted written applications in 2000 and 2003 and again documented her interest in 2004. Clerk positions became available in 2005, 2006, and 2007. She did not submit written applications at any of those times. On each of those occasions, the Postal Service offered the job to someone who had submitted a written application. Hill brought an action against the Postmaster General, alleging that the lost hours and failure to promote were in retaliation for her protected activities (her EEO complaints). Judge Coar (ND. Ill.) granted summary judgment to the defendant. Hill appeals.

In their opinion, Judges Flaum, Kanne, and Evans affirmed. The Court noted that Hill proceeded under the indirect method of proof -- which requires proof of a statutorily protected activity, a materially adverse job action, satisfactory job performance, and treatment worse than a similarly situated employee. The elements at issue here are whether there was an adverse job action (on the reduction in hours claim) and whether Hill was treated differently from similarly situated employees (on the failure to promote claim). The Court first addressed adverse job action. Although a reduction in hours can be an adverse job action, the reduction here came as a result of her light duty status. It does not amount to an adverse job action without other evidence. The Court rejected Hill's claim that Kavanaugh's letter to Schultz somehow imputed a retaliatory motive to Schultz under a "cat's paw" theory. There was no evidence in the record that the letter had any effect on Schultz -- let alone a dispositive one. Therefore, Hill's light duty assignment itself was not an adverse job action. The Court also concluded that sending her home without pay was also not an adverse job action. Although there was evidence in the record that other employees worked overtime, there was no evidence in the record that that overtime work fell within her work performance limitations. Finally, the Court rejected Hill's failure to promote theory of liability. In order to prevail, she had to establish that she properly applied for the promotion. The Postal Service presented evidence that its unofficial policy required an application in writing -- even though that unofficial policy was inconsistent with the written policy and the Postal Service presented no documentary evidence that supported it. Nevertheless, the Court concluded that Hill had not met her burden of establishing pretext. She failed to come forward with any evidence from which an inference could be drawn that the Postal Service evidence was not credible.

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HATMAKER v. MEMORIAL MEDICAL CENTER (August 30, 2010)

When the director of its chaplain staff died, Memorial Medical Center announced a search for her replacement. Rev. Greg Stafford, the acting director, was a candidate for the job. Forrest Hester, the Center's Human Resources Officer, solicited opinions from the staff regarding Stafford's candidacy. Janet Hatmaker, a part-time chaplain, expressed concerns about Stafford's demeanor, appropriateness, and leadership. Hatmaker remained critical of Stafford after his appointment. She told Hester that she and other women were uncomfortable with him, that she thought he was distrustful and uncomfortable with women, and that he had diminished view of younger women. Her remarks prompted Hester to conduct an investigation into the possibility of a hostile work environment. Although Hatmaker was reluctant to participate in the investigation, she ultimately did so. Hatmaker was quite opinionated in her remarks to the investigator, including negative references to Jews, Catholics, Al Sharpton, Jesse Jackson, and the Center itself. Hester and the investigator concluded that no hostile work environment existed. In fact, Hester was more concerned about Hatmaker's attitude and remarks. He instructed her to stop talking with her co-employees about Stafford and advised that she should resign if she was uncomfortable working under his leadership. When she responded with another communication indicating her preoccupation with Stafford's professional development, Hester suspended her. He later fired her. She brought suit against the Center under Title VII. Title VII prohibits discrimination against an employee because the employee has opposed an unlawful employment practice or has participated in an investigation under the statute. Judge Scott (C.D. Ill.) granted summary judgment to the Center. Hatmaker appeals.

In their opinion, Chief Judge Easterbrook and Judges Posner and Evans affirmed. Title VII’s “participation” clause prohibits discrimination against an employee who participates in investigation but does not protect the employee from being fired if circumstances otherwise warrant. Here, Hatmaker was not fired because of her communications to the investigator -- she was fired for exercising poor judgment and for being preoccupied with some rather innocuous characteristics of her new supervisor. None of her comments actually accused him of discrimination or of creating a hostile work environment. Furthermore, alternatively, the Court stated that an independent ground for affirmance was the fact that Title VII's reference to an "investigation" includes only official investigations, not purely internal investigations. Since no official investigation was conducted here, the participation clause does not apply. Finally, the Court briefly addressed her "opposition" claim. An opposition claim must be based on a good faith and reasonable belief that there is a statutory violation. That belief is not present here.

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PALOIAN v. LASALLE BANK (August 27, 2010)

James Desnick purchased the Doctors Hospital of Hyde Park in 1992, after he left the practice of medicine amid charges of misconduct. The Hospital remained open until 2000. Two loans are at issue in this appeal. In March of 1997, MMA Funding (also owned by Desnick) obtained a $25 million line of credit from Daiwa, which it then made available to the Hospital. In return, the Hospital transferred its accounts receivable to MMA, and MMA gave Daiwa a security interest in them. In August of the same year, Nomura Asset Capital Corporation loaned $50 million to HPCH (which owned the building and land -- and was also owned by Desnick). HPCH made the $50 million available to the Hospital. In return, the Hospital paid additional rent to HPCH and HPCH gave Nomura a security interest in the rent. The Nomura loan was later securitized, sold to a third party, and transferred to a trust. LaSalle National Bank is the trustee. Cash-flow problems led to the Hospital's bankruptcy filing. The trustee in bankruptcy sought to recover some of the payments on the loans as fraudulent conveyances. The bankruptcy court concluded that the Hospital was insolvent at least by August of 1997, that the increased rent was in reality debt service, and that the Nomura loan repayments were fraudulent conveyances. The bankruptcy court also concluded that repayments on both loans after July of 1998 were outside the bankruptcy because they were made with MMA's assets, not the Hospital's. Judge Pallmeyer (N.D. Ill.) affirmed the bankruptcy court. Both trustees appeal.

In their opinion, Chief Judge Easterbrook and Judges Rovner and Tinder vacated and remanded. The Court first addressed LaSalle's argument that it is not an "initial transferee" under the Code and that the payments cannot therefore be recovered. Although the Code does not define "initial transferee," the Court relied on its own earlier decision in Bonded Financial Services to conclude that LaSalle was the real recipient of the transfer since it was the legal owner of the trust's assets. Next, the Court addressed whether the Hospital was insolvent in August of 1977. The trustee in bankruptcy cannot avoid the transfers unless it was. The bankruptcy court used a discounted-cash-flow analysis (which showed that the Hospital was comfortably solvent), but then subtracted $18.5 million that a later audit determined to be the amount of Medicare overpayments, and then reduced its future income calculation by 40% because it was a Subchapter S corporation. The court reasoned that a tax-paying buyer would reduce the purchase price because of tax consequences. The Court found both downward adjustments to be in error. With respect to the Medicare overpayments, the Court stated that the balance sheet should have included an estimate (as of 1997) of the Hospital's liability on the Medicare audit and an estimate of how much Desnick would contribute. Here, Desnick paid the entire $18.5 million. Since the court used hindsight to include the $18.5 million of liability, it should have used the same hindsight to eliminate the liability because of Desnick's contribution. With respect to the 40% reduction, the Court concluded that the discount could only be justified by the illiquidity of the Hospital's shares or the potential that a tax-paying entity bought the hospital. But neither of those is relevant to the Hospital's solvency. The Court therefore concluded that the Hospital was solvent in August of 1997 and that the following months’ debt service was not a fraudulent conveyance. The Court noted that, on remand, the bankruptcy court may be asked to determine whether the Hospital was insolvent at some other time after August of 1997 but before it filed for bankruptcy. Finally, the Court addressed whether Desnick and Daiwa succeeded in creating a "bankruptcy-remote vehicle" in MMA. If they did, Daiwa could rely on the assets of MMA without fear of bankruptcy implications if the Hospital failed. Such an arrangement requires that the separate entity (here, MMA) be independent and separate and observe corporate formalities. The Court noted that those attributes appear to be missing here. MMA was not independent, it was not separate, it had little existence outside the loan documents, and did not even actually purchase the accounts receivable. The Court did allow for the possibility that a record could be developed otherwise on remand -- if, in fact, the bankruptcy court determines that the Hospital was insolvent at some time before filing.

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SKS & ASSOCIATES v. DART (August 27, 2010)

SKS & Associates owns a number of residential rental properties in and around Chicago. From time to time, SKS has used Illinois' eviction procedures to deal with tenants who do not pay their rent. In November of 2008, the Chief Judge of the Cook County Circuit Court entered a General Order that prohibited the Sheriff from carrying out an eviction order during a specified period around the winter holidays, whenever the temperature was lower than 15°, or when the Sheriff determined that "extreme weather conditions" threatened the health and welfare of persons evicted. SKS brought an action pursuant to § 1983 against the Chief Judge and the Sheriff. It alleges that the Order denies it equal protection, deprives it of property without due process, and that it amounts to the establishment of a religion. Judge Shadur (N. D. Ill.) dismissed the action before the defendants appeared. SKS appeals.

In their opinion, Judges Kanne, Wood, and Hamilton affirmed. Although a federal court should normally exercise the jurisdiction which it has been granted by the Constitution, there are exceptions. The Court noted the four main abstention doctrines: Pullman, Burford, Younger, and Colorado River. With respect to each of these doctrines, a federal court can decline to exercise its jurisdiction. The Younger doctrine, the only abstention doctrine inapplicable here, teaches a federal court to abstain from resolving federal constitutional claims when doing so would interfere with ongoing state proceedings. The Younger doctrine started in the criminal context and required abstention when a criminal defendant sought to block a state prosecution on federal constitutional grounds. The Supreme Court has extended it, on a limited basis, to civil proceedings. It has not, however, extended to a situation, like this, where SKS is not the target of any state enforcement. Nevertheless, the Court identified the same principles (equity, comity, and federalism) at stake here that support the Younger doctrine. SKS wants a federal court to tell a state court how to manage its cases. Doing so would demonstrate a lack of respect for the state court's abilities. Furthermore, the Court did not believe that SKS had no state remedies. It could simply ask the court to issue an eviction order notwithstanding the General Order, it could file suit in state court to vacate the General Order, or it could seek a writ of mandamus to compel a reversal of the Order. SKS must allow a state court the opportunity to address its constitutional complaints about the Order.

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XODUS v. WACKENHUT CORP. (August 27, 2010)

Lord Osunfarian Xodus is a Rastafarian and Hebrew Israelite. He sports a dreadlocked hairstyle as a result of his religious beliefs. In mid-2004, his employer, a security firm, discharged him for his failure to comply with its grooming policy. He sought another security guard position and on July 7 interviewed at Allied Security and Wackenhut Corporation. Allied refused to hire him because of his dreadlocks. Later the same day, Wackenhut also refused to hire him. Xodus brought an action against Wackenhut, alleging religious discrimination. On summary judgment, Judge Walter (N.D. Ill.) concluded that genuine issues of fact existed and denied Wackenhut's motion. The case was tried to the court -- the only issue was whether Xodus brought to the interviewer's attention the fact that he had dreadlocks because of his religious beliefs. Xodus and the interviewer presented different versions of the day's events. Xodus testified that he specifically informed the interviewer that his refusal to cut his dreadlocks, which led to his earlier discharge, was based on his religious beliefs. The interviewer, on the other hand, testified that he raised the company's grooming policy as soon as he saw the dreadlocks and told Xodus that he would have to cut his hair in order to be hired. He further testified that Xodus never informed him of his specific religious beliefs, although he admitted that Xodus did make a single, innocuous reference to a "belief." The interviewer testified that he made no connection to a religious belief as a result of the remark. The court found for Wackenhut, concluding that the testimony of the interviewer was more credible. Xodus appeals.

In their opinion, Judges Bauer, Rovner, and Hamilton affirmed. The Court concluded that the district court's factual finding that the interviewer was not aware of Xodus’ religious beliefs was not clearly erroneous. A person's religion, unlike a person's gender or race, is not readily apparent. An employee or prospective employee, therefore, must advise his employer of particular religious practices or beliefs. The Court found that the district court's opinion, although brief, provided sufficient detail of the testimony and corroborating evidence that led to his conclusion that the interviewer's testimony was more credible.

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GROSS v. TOWN OF CICERO (August 27, 2010)

For several years after Clarence Gross retired as a Cicero police officer, he served in a number of appointed positions in the Town's government. The Town President appointed him Chairman of the Board of Fire and Police Commissioners. As Chairman, Gross oversaw the hiring of the Town's police officers. Gross admits that he hired several officers that he deemed unqualified because he was directed to do so by the Town President. Rhonda Gross, Clarence's daughter, also served as a Cicero police officer during this time. She complained to Gross that she and other female police officers were the victims of sexual harassment. Gross approached the Town President on several occasions to discuss the harassment. On each occasion, she deflected his attempt and promised to address it later. Rhonda filed an EEOC charge. The EEOC found substantial evidence that she was the subject of sexual harassment -- the Town settled. After Rhonda filed her charge, Gross was removed from his various appointments. He complained to the Town's attorney that he was owed compensation. When he became involved as a potential witness in litigation against the Town, he claims that the attorney told him he would not get his compensation until the other litigation was resolved. Gross brought suit pursuant to § 1983 against the Town, the President, a successor President, and the Town’s attorney. He alleged First Amendment free-speech violations. The Town brought counterclaims for breach of fiduciary duty and unjust enrichment. Judge Darrah (N.D. Ill.) granted summary judgment to the defendants on Gross' claim, granted summary judgment to Gross on the unjust enrichment claim, but granted summary judgment on liability to the Town on the breach of fiduciary duty claim. The court ultimately awarded over $300,000 on the claim after a bench trial, representing Gross' entire salary for the years in question.

In their opinion, Judges Cudahy, Williams, and Tinder affirmed in part and reversed and remanded in part. The Court first addressed Gross' First Amendment retaliation claims, specifically the first prong of the retaliation inquiry -- whether his speech was constitutionally protected. Three different episodes of retaliation were alleged: a) his sexual harassment complaints on behalf of Rhonda to the Town President, b) his instruction to Rhonda to file an EEOC charge, and c) his conversations with the plaintiffs’ lawyers in another case against the Town. The Court concluded that none of the episodes constituted protected speech: a) his complaints to the Town President about sexual harassment (to the extent there was even any actual content to the speech, as opposed to a mere request to discuss) were not matters of public concern but merely a private grievance, b) any encouragement to Rhonda to file the EEOC charge was not speech on a matter of public concern but, again, a mere private matter (the record also contains no evidence that any defendant was aware of this speech, precluding a finding of causation), and c) there is no evidence in the record to establish that a conversation with plaintiffs' lawyers in another case could constitute protected speech. The Court therefore affirmed the district court's finding in favor of the defendants on Gross’ First Amendment claim. The Court next addressed the Town’s breach of fiduciary duty claim. The district court noted that an Illinois statute sets standards by which municipalities’ Police Boards must evaluate appointed police officers. The court held that the statute created a fiduciary duty on the part of Police Board members to exercise independent judgment. The Court disagreed. The statute does not refer to fiduciary duties and the Court was reluctant to create one. Instead, the statute merely grants authority and establishes rules for the exercise of that authority. Although it concluded that the statute did not create a duty, the Court did recognize that Gross was subject to a duty of loyalty owed by all public officials. Relying on the standard the Illinois Supreme Court stated in upholding a criminal conviction, the Court ruled that there was sufficient evidence (barely) in the record for a factfinder to conclude that Gross violated that duty. A factfinder could conclude that Gross engaged in a quid pro quo arrangement with the Town President by which he protected his and his daughter’s jobs in return for appointing unqualified police officers selected by the President. The Court remanded for additional factual findings on that issue. Its conclusion on liability did not necessitate any analysis of the damage award. Nevertheless, the Court commented that the district court’s total salary forfeiture was not correct, unless Gross was breaching his duty during his entire tenure, a conclusion not supported by the current record.

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UNIVERSITY OF CHICAGO MEDICAL CENTER v. SEBELIUS (August 25, 2010)

Prior to 1980, the federal Medicare program treated teaching hospitals and non-teaching hospitals the same for reimbursement purposes. Teaching hospitals, however, had higher service costs. The Secretary established an adjustment for teaching hospitals in 1980. The adjustment was based on the number of full-time equivalent (FTE) residents employed on a particular date. When Congress further amended the Medicare reimbursement program in 1983, it included an indirect medical education (IME) adjustment to replace the Secretary's 1980 directive that also was based on the number of FTEs. The regulations in effect in 1996 required a resident to be assigned to the outpatient department of a hospital or the "portion" of the hospital subject to the 1983 program. Further amendments in 2001 excluded time spent in research not associated with treatment or diagnosis even if the resident was assigned to one of those two departments. The University of Chicago Medical Center included pure research time in calculating its residents' FTE count for fiscal year 1996. The Medicare program Administrators excluded that time. The district court disagreed. Judge Andersen (N.D. Ill.) concluded that "outpatient department" and "portion" are geographic areas, not spheres of operation as argued by the Administrator. The Secretary appeals.

In their opinion, Judges Cudahy, Evans, and Sykes affirmed. Although the Court agreed that the plain language of the regulation referred to a resident's geographic location, it also conceded that the answer to the ultimate question was not clear. If the regulation was ambiguous, the Court would have to address the degree of deference owed to the Secretary. In any event, the Court concluded that legislation enacted after oral argument provided the answer. The Patient Protection and Affordable Care Act, enacted in March of 2010, allowed the inclusion of non-patient care activities in the IME FTE count retroactively to 1983. It also provided that pure research activities should not be counted after 2001. Although the 2001 provision specifically stated that no inference should be drawn regarding pre-2001 calculations, the Court concluded that pure research was a subcategory of "non-patient care activities" and therefore specifically included in the Act's retroactive language.

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In its August 24 opinion in Rexam Beverage Can Co. v. Bolger, the Court affirmed an award of attorney’s fees based on a lease provision. The lease paragraph at issue was not a “prevailing party” fee-shifting provision but rather a pretty standard lessee indemnification provision. In it, the lessee agreed to indemnify lessor against all claims “by or in behalf of any person” arising from the occupation, use, etc. of the premises arising during the term of the lease – and against all cost and attorney fees incurred “in or about any such claim.” The Court applied this provision to award attorneys’ fees to the lessor in a suit brought by the lessor to require the lessee to make certain repairs to the premises before returning possession to the lessor. The Court rejected arguments that the provision only applied to third party claims and that it required the lessor to prevail on its claims.

Can this be correct? Although the lessor did prevail on part of its claim for repairs, the Court held that the plain and unambiguous language of the lease did not exclude claims between the parties and did not require success. What if the lessor brought an action for repairs and lost? Under the Court’s analysis, the lessee would have to pay the lessor’s attorneys’ fees. In fact, under the Court’s analysis, the lessee could never prevail in an action against the lessor because it indemnified the lessor against “all actions.”

It seems obvious that the reason the provision does not have a “prevailing party” or success requirement is because it is not meant to address actions between the parties. The lessee is required to indemnify the lessor, including fees, in any action by a third party, whether or not the lessor prevails. The lessor is basically saying: “If I get sued, you will handle it.” The problem is that the language of the lease does not specifically address the issue. The Court has, in the past, refused to read contracts in a way that would create a commercially unreasonable result – it should have done so here as well, in my opinion. (See here for a recent article on the New York courts’ treatment of the issue.)

The Court also affirmed the fee award under a second lease provision dealing with correcting events of default. Therefore, the case would have turned out the same had it rejected the indemnification argument - all the more reason not to go there.

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REXAM BEVERAGE CAN CO. v. BOLGER (August 24, 2010)

Almost 50 years ago, David Bolger constructed a warehouse near Rockford, Illinois and leased it to Rexam Beverage Can Company. In 2005, Rexam attempted to renew the lease for another five-year term, but failed to give the requisite notice. Bolger advised Rexam that it would have to vacate the premises at the expiration of the lease in March of 2006. Bolger also requested that certain repairs be made. Rexam did not vacate the premises. Instead, it filed a declaratory judgment action. It also continued to pay all utilities and rent, although Bolger returned the rent checks. Eventually, Rexam found a new home, made some repairs to the Rockford warehouse, and returned possession to Bolger at the end of August, 2007. Although Rexam made significant repairs to the warehouse, it did not replace the roof as Bolger had requested. The roof repair estimate was approximately $400,000. Bolger sold the property within several months without replacing the roof. Shortly before Rexam vacated the warehouse, Judge Ashman (N.D. Ill.) ruled on the declaratory judgment action. He concluded that Rexam did not meet the lease's renewal notice requirements and that its continued occupation of the warehouse was "willful" under Illinois' Holdover Statute. After a bench trial, the court found for Bolger and awarded $1.1 million for the holdover, $400,000 for the roof replacement, $20,000 for other repairs, and over $800,000 in attorneys' fees. Rexam appeals.

In their opinion, Chief Judge Easterbrook and Judges Manion and Tinder affirmed in part and vacated and remanded in part. The Court first addressed Rexam's liability for roof repairs under the lease. Under Illinois law, the lease is like any other contract and, if unambiguous, will be applied according to its terms. Using that analysis, the Court concluded that the lease language ("Lessor shall have no obligation with respect to the maintenance and repair . . .” and "Lessee shall be solely responsible . . . for keeping all of the [buildings] in good condition, order and repair, including all structural and extraordinary changes . . .") was unambiguous and placed the contractual burden of roof repairs on Rexam. With respect to damages for the roof, which the district court fixed at the estimated repair costs, the Court noted that Illinois law limits damages in such a situation to the diminution in property value. If the repair cost exceeds diminution in value, only the latter is awarded. The district court was presented with conflicting evidence on this issue and determined that the two measurements of damages were equal. The Court found no clear error. The Court turned to the award of damages under the Holdover Statute. It first concluded that there was no clear error in the district court's factual finding that the holdover was willful. Although the statute does not define willful, the Court relied on an intermediate Illinois case that rejected a "bad faith" test and instead adopted a test that excuses a tenant who remains in possession for a "colorably justifiable" reason. The Court agreed with the district court's conclusion that Rexam's holdover was not justifiable. With respect to damages, the statute assesses a penalty of "double the yearly value of the lands." The district court based its award on expert testimony establishing the monthly gross rental rate of the warehouse. The Court concluded that the use of the gross rental rate to measure damages was incorrect. Relying on the plain language of the statute, the intent of the legislation, and the dictionary definitions of "annual value" and "land," the Court concluded that holdover damages should be based on net rental value instead of gross rental value. The Court remanded for a determination of net rental value. Finally, the Court turned to the award of attorneys’ fees. Litigants in Illinois are generally responsible for their own attorneys' fees unless a statute or contract provides otherwise. The Court agreed with the district court's conclusion that the lease in question provided a basis for Bolger to recover fees associated with the repair issues but not the holdover issue. Fees for the holdover issue were not covered because the fee provision was limited to claims arising during the lease term. By its very nature, the holdover claim did not arise during of the lease term. The Court next rejected Rexam's argument that Bolger should be limited to recovering fees on those repair claims on which he was successful. The language of the lease's fee provision did not require success. With respect to the district court's efforts to disentangle fees associated with the repair issues and the holdover issues, the Court found no abuse of discretion although it did not endorse the district court's rather superficial approach.

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BERRY v. CHICAGO TRANSIT AUTHORITY (August 23, 2010)

Cynthia Berry was one of only two females among the approximately fifty Chicago Transit Authority (CTA) employees in her work area. Early in 2006, during a morning break, Berry alleges that she was the victim of sexual harassment. The episode included significant, unwelcome physical touching. She reported the episode to a supervisor the following day. According to Berry, her supervisor told her she could lose her job if she pursued charges, told her he was going to protect the CTA, and instructed her to stay away from the break area. The supervisor took statements from the other witnesses, all of whom identified Berry as the aggressor. The official internal investigation came to the same conclusion. Shortly thereafter, Berry went on short-term leave and never returned to her job. She sought injured-on-duty status, which would have qualified her for workers compensation, but alleges that her supervisor refused. Berry brought suit for sex discrimination and hostile work environment. Judge Conlon (N.D. Ill.) granted summary judgment to the CTA, concluding that the CTA took prompt and reasonable steps in response to the allegations and that Berry suffered no adverse employment action. Berry appeals.

In their opinion, Judges Kanne, Rover, and Tinder affirmed in part and reversed and remanded in part. The Court agreed with the district court that Berry could not establish an adverse employment action -- so her discrimination claim must fail. Berry asserted a hostile environment claim both with respect to her co-worker (the unwelcome physical contact) and her supervisor (his dismissive comments). The Court first pointed out that Berry's testimony, although self-serving and uncorroborated, can be evidence of a disputed fact if it is based on personal knowledge. With respect to the hostile environment claim against the supervisor, the Court criticized the lower court for discounting Berry's testimony but nonetheless concluded that the dismissive comments were not severe or pervasive enough to constitute a hostile environment. They were infrequent, not threatening, and did not interfere with her employment. The allegations against the co-worker were different. Unwelcome and uninvited contact with intimate body parts is the most severe type of harassment. The Court concluded that Berry's claim could go forward. In addition, the Court concluded that the claim against the CTA based on the co-worker's harassment should go forward. Again, the Court criticized the district court's treatment of Berry's testimony. She contends that her supervisor sabotaged the investigation. A reasonable fact finder could find that the CTA was negligent in responding to her charges, and therefore liable.

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SCHLEICHER v. WENDT (August 20, 2010)

Conseco was a large financial services company traded on the New York Stock Exchange. It filed for bankruptcy in 2002 and successfully reorganized. This securities-fraud claim was filed against Conseco managers who are alleged to have made false statements prior to the bankruptcy. Then-District Judge Hamilton (S.D. Ind.) certified a class. Defendants appeal.

In their opinion, Chief Judge Easterbrook and Judges Bauer and Rovner affirmed. The Court began by noting that securities-fraud claims are regularly litigated as class actions. Common questions generally include falsehood, intent, causation, and materiality. Individual questions, such as an individual investor's extent of loss, can frequently be addressed mechanically. Prior to 1988, defendants fought class certification by focusing on the reliance element. But the Supreme Court that year, in Basic, concluded that the stock price conveys the same public information to each investor if the stock is frequently traded in an efficient market. The Basic doctrine, called fraud on the market, replaced the reliance element. Here, the defendants argued that the fraud on the market doctrine does not apply because, notwithstanding the alleged false statements, Conseco's stock was falling during the relevant period. The Court found that fact to be irrelevant and concluded that the case met the Basic requirements. The Court also rejected defendants’ arguments that certification was improper because the class included short sellers and because the court failed to determine falsity and materiality. On the former, the Court noted that both long and short sellers are affected by news related to the value of a stock. The fact that short sellers may not realize a loss as a result of a false statement affects computation of damages, not the propriety of a class. On the latter, the Court stated that falsity and materiality are elements to be decide on the merits – not at the class certification stage. In doing so, it specifically expressed its disagreement with the Fifth Circuit’s decision in Oscar Private Equity that reads Basic to allow a tightening of class certification requirements. Congress has spoken on the issue in the Private Securities Litigation Reform Act and the Securities Litigation Uniform Standards Act. The Court declined to legislate other changes.

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BAUER v. SHEPARD (August 20, 2010)

Indiana Right to Life, Inc. sends questionnaires to judicial candidates for election or retention. The questionnaires seek information on the recipient's views on abortion. The organization filed suit challenging certain provisions of Indiana's Code of Judicial Conduct relating to the political activities of judges and candidates for judicial office. The suit was dismissed for lack of standing. In the present suit, the organization is joined by a sitting judge and a candidate for judicial office. The plaintiffs challenge five provisions of the code, four current and one which was in effect in 2008: a) the current and former rules forbidding "commitments that are inconsistent with the impartial performance of judicial office," b) the rule requiring recusal of a judge if he or she made a public statement "that commits or appears to commit the judge to reach a particular result," c) the rule limiting the partisan political activities of judges, and d) limits on fundraising. Judge Springmann (N.D. Ind.) concluded that the challenge to the earlier version of the code was moot and concluded that the challenged sections of the current code were all constitutional. Plaintiffs appeal.

In their opinion, Chief Judge Easterbrook and Judges Manion and Evans affirmed as modified. The Court first concluded that the individual plaintiffs had standing because of the threat to prosecute and the probability of future injury. Next, the Court addressed the challenge to the no-longer current section of the code. It disagreed with the lower court's finding of mootness. The code's amendment in 2009 did not eliminate the possibility of a prosecution for an earlier violation. Nevertheless, given the significant number of unlikely steps that must occur before such a prosecution, the Court concluded that the matter was not ripe for adjudication. The Court then addressed the merits of the challenge to the four current provisions in light of the Supreme Court's decision in White and the Court's own decision earlier this year in Siefert. The Court held: 1) The solicitation prohibition is fundamentally the same as the one the Court upheld in Siefert. It is not facially unconstitutional and the state should be given an opportunity to make exceptions as appropriate. 2) Although Siefert did not address political leadership roles and speechmaking, it did uphold a prohibition on public political endorsements. Its analysis led the Court to conclude that the preservation of public confidence in the judiciary is enough of a compelling interest to uphold the leadership and speechmaking prohibitions of the Indiana code. White dealt with limitations on the judge's own positions -- it did not affect precedent dealing with a judge's impact on the other elections. 3) With respect to the "commits" provision, the Court distinguished between the questionnaire, which asked for a candidate's views on certain topics and which the Supreme Court said was allowable, and the code provision, which only prohibits commitments "inconsistent with the impartial performance" of one's office. The Court did recognize some vagueness in the language. However, instead of identifying hypothetical situations in which the state may act too broadly, the Court chose to assume that the state would act reasonably and continue to refine the meaning of the provision through the administrative processes. 4) Finally, with respect to the recusal provision, the Court found no constitutional issue at all. The recusal clause does not address a judge's role as candidate -- it addresses a judge's role as public employee. Under Garcetti, a judge's speech in his role as a judge is not protected speech. Furthermore, a state has every right to allocate a court case to a judge whose impartiality is not open to debate.

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TRENTADUE v. REDMON (August 18, 2010)

During the 2003-2004 school year, Major Lee Redmon supervised the Junior ROTC program at Pekin High School and Mark Cole was one of his instructors. Cole admittedly had sexual contact with a female student on multiple occasions. The student reported the abuse to her mother on November 5. They immediately reported the incident to school authorities, the school district, and the police. The student's stepfather confronted Redmon. According to the stepfather, Redmon said that "this incident has happened before." After the local newspaper reported the incident, two former students came forward with allegations that they two had been abused by Cole, one in 1996 and one in 2002. The student brought suit against Redmon under § 1983 and against the school district under Title IX. Judge Mihm (C.D. Ill.) dismissed the action against Redmon based on circuit precedent that Title IX precludes a § 1983 action based on supervisor liability. The court later entered summary judgment for the school district on the Title IX claim. The student appeals.

In their opinion, Judges Flaum, Wood, and Sykes affirmed as modified. The Court first concluded that the district court was in error in dismissing the § 1983 claim -- but only because of the Supreme Court's intervening holding in Fitzgerald that such a claim is not precluded by Title IX. Since the district court did not address the claim on the merits, a remand would normally be appropriate. However, here the § 1983 claim rested on the same set of facts as the Title IX claim, which the court did fully consider on the merits, so a remand is unnecessary. Liability under either theory requires evidence of knowledge and indifference or facilitation -- on the part of Redmon with respect to the § 1983 claim and on the part of the school district with respect to the Title IX claim. The parties do not dispute that neither the school officials nor Redmon knew of Cole's abuse of the plaintiff. It is also undisputed that no school official knew of the two earlier incidents. The only issue, therefore, is whether Redmon knew of either of the earlier incidents. Plaintiff's entire argument rests on Redmon’s "this incident happened before" statement. But Redmon testified that he did not know of Cole's earlier abuse and explained his reference to an earlier incident as one involving his predecessor, not Cole. On that record, the Court concluded that the plaintiff's interpretation of the remark was mere speculation unsupported by evidence. At the summary judgment stage, plaintiff had the obligation to identify some evidence on that issue.

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SOTTORIVA v. CLAPS (August 17, 2010)

Joseph Sottoriva was a State of Illinois employee and a member of the United States Army Reserve. He was on leave from the State for approximately 17 months in 2003 and 2004. The State's policy was to retain reservists on the payroll and continue to compensate them at their regular rate of pay, minus their military income. The State consistently overcompensated Sottoriva, despite its best efforts to calculate the proper amounts. Shortly before Sottoriva's return, the State calculated that he owed approximately $18,000 in excess compensation. He filed a union grievance, which the union (apparently without his consent) resolved with the State by agreeing to repay the $18,000 under a payment plan. While still negotiating the payment plan, the State recalculated the excess compensation as $24,000. Sottoriva was given several repayment options. When he selected none of them, the State notified him that it would begin involuntary withholding. Sottoriva brought a three count complaint against the department's director and the State Comptroller: a) Count I sought to enjoin any wage reduction, alleging due process violations with respect both to the original union grievance procedure and the State's failure to conduct any hearing with respect to the recalculation, b) Count II sought monetary damages for Sottoriva’s tax losses, and c) Count III sought to remove the director from office for an alleged violation of the State Finance Act. On Count I, Judge Scott (C.D. Ill.) granted summary judgment to the defendants with respect to the $18,000 calculation but granted summary judgment to Sottoriva on any amount above the $18,000 figure, concluding that the State had not provided a meaningful hearing. Sottoriva withdrew Count II. The court held that Count III was barred by the Eleventh Amendment. Sottoriva sought an award of attorney's fees. The court carefully calculated a "lodestar" figure and reduced it by 67%. Sottoriva appeals.

In their opinion, Judges Ripple, Kanne, and Sykes vacated and remanded. The Court noted that § 1988(b) allows the district court, in its discretion, to award attorney's fees to a prevailing party. Although the Court grants great latitude in setting a fee award, a district court must justify its award. The Court applied a two-part test to the district court's reduction of the "lodestar." The first question was whether a downward reduction was appropriate. The second question was whether the amount of the reduction was reasonable. Here, the Court answered the first question affirmatively. Although Sottoriva prevailed on one portion of his due process claim, he also failed on a significant part of his request for relief. With respect to the amount of the reduction, however, the Court vacated. Although it expressed no opinion on the reasonableness of the 67% reduction, it concluded that the district court did not sufficiently explain its rationale for imposing that reduction. In particular, the Court was concerned that the lower court was engaged in unacceptable "claim counting" and simply awarded one third of the fees incurred because Sottoriva prevailed on one of the three counts asserted. The lack of explanation amounted to an abuse of discretion.

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CASTILE v. ASTRUE (August 13, 2010)

Barbara Castile filed her application for Social Security disability benefits in 2002. She asserted that her disability began in 2001 and was a result of the combined effects of fibromyalgia, arthritis, chronic fatigue, obesity, and a host of other maladies. Her application was denied, denied again after reconsideration, denied again after an administrative hearing, and denied again after a supplemental evidentiary hearing. The denial was affirmed by the Appeals Council. Castile filed suit for judicial review and then-District Judge Hamilton (S.D. Ind.) affirmed. Castile appeals.

In their opinion, Chief Judge Easterbrook and Judges Posner and Kanne affirmed. The Court first addressed Castile's argument that the ALJ erred in not considering her chronic fatigue syndrome as a severe impairment. It found not only the presence of substantial evidence to support that finding, but also noted that any error would have been of no consequence. The ALJ did find other severe impairments and was required to (and did) consider the cumulative effect of all impairments, severe and non-severe. His severity finding with respect to chronic fatigue did not matter. Next, the Court concluded that the Castile did not carry her burden in proving the combination of impairments rendered her disabled because of absenteeism. She failed to present any medical evidence on that issue. Next, the Court noted that the record did not support Castile's claim that the ALJ failed to properly consider her obesity. The Court noted the ALJ's careful consideration and thorough discussion of the evidence. Similarly, the Court concluded that the ALJ's assessment of her credibility was amply supported by the record and the result of careful consideration.

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ABCARIAN v. MCDONALD (August 13, 2010)

Dr. Herand Abcarian was a senior surgeon at the University of Illinois College of Medicine and the University of Illinois Medical Center in Chicago. Over time, he clashed frequently with co-employees over issues like recruitment, compensation, risk management, and benefits. He alleges that several of these co-employees conspired to defame him and deprive him of his constitutional rights. In particular, he alleges: a) they caused the University to settle a malpractice claim against him for almost $1 million, b) the reported the malpractice settlement to federal and state databanks, and c) they caused the malpractice plaintiff's attorney to file suit against Abcarian only to then have it dismissed as a result of the settlement. Abcarian brought suit pursuant to § 1983, alleging constitutional violations of his right to free speech, equal protection, and procedural due process. Judge Der-Yeghiayan (N.D. Ill.) dismissed for failure to state a claim. He also denied Abcarian's requests to amend the judgment and to amend his complaint. Abcarian appeals.

In their opinion, Judges Kanne, Williams, and Hamilton affirmed. The Court first addressed his First Amendment claim that he was retaliated against for his speech. Garcetti dealt with an employer's retaliation and the Court noted that it had already reserved judgment once about whether that rule applied to a co-employee's retaliation. Again, the Court ducked the question whether Garcetti applies to all employees but did conclude that it applies to employees whose actions are advancing the interests of their employer. The Court also concluded that a practical view of the speech, keeping in mind Abcarian's role and the content and context of the speech, lead to the conclusion that he spoke as a public employee under Garcetti, not as a private citizen. His speech was therefore not protected. Abcarian's equal protection claim was a "class-of-one" claim under which a plaintiff need not allege a suspect classification. The plaintiff must, however, allege arbitrary treatment without a rational basis. The basis of Abcarian's claim is that the defendants reported the malpractice settlement. But they had no discretion in the matter. Federal and state law required the report and would have exposed them to punishment had they failed to report. The Court concluded that the lack of discretion precluded an equal protection claim. Abcarian's third constitutional claim was a procedural due process claim based on the defendants' defamation. In order for defamation to rise to the level of a due process violation, a plaintiff must allege that was stigmatized by publicly disclosed information and that he suffered a loss of employment opportunities. The Court concluded that Abcarian could not meet this test because he still maintains his same positions at the Medical Center and College of Medicine. One cannot be thought to have been deprived of something that one still possesses. Finally, the Court concluded that Abcarian could not and did not meet the test for a Rule 59(e) motion. Since a post-judgment amendment would only be allowed if his Rule 59(e) motion was granted and it was clear that the district court had entered a final judgment, Abcarian was also not entitled to amend his complaint.

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