Justia U.S. 2nd Circuit Court of Appeals Opinion Summaries

A major radio broadcasting company sought to purchase national radio audience data from a market research firm, which is the sole supplier of such data in the United States. The broadcaster also desired to buy the firm’s local radio audience data in select markets, while sourcing local data from a competitor in other markets. In 2024, the research firm instituted a policy requiring national broadcasters to purchase its local data in every market where they operate in order to access the full national report. This policy forced the broadcaster to choose between buying all local data from the firm or losing access to the essential national data product.The broadcaster sued in the United States District Court for the Southern District of New York, alleging that the firm’s policy constituted an unlawful tying arrangement under the Sherman Act. After discovery and a hearing, the district court found that the firm used its monopoly power in the national data market to coerce customers into buying local data products, resulting in anticompetitive effects in local markets by excluding competitors. The district court granted a preliminary injunction prohibiting the firm from enforcing its tying policy and from charging commercially unreasonable rates for the national report as a standalone product. The firm’s subsequent counterclaims and the broadcaster’s bankruptcy petition led the district court to stay litigation of the counterclaims, but not the broadcaster’s claims.The United States Court of Appeals for the Second Circuit reviewed the district court’s order for abuse of discretion. The appellate court held that constructive tying—where pricing effectively conditions the purchase of one product on another—can violate the Sherman Act. It affirmed the district court’s findings regarding coercion, anticompetitive effects, irreparable harm, and the tailored injunction, and held that the bankruptcy did not require a stay of the appeal. The preliminary injunction was affirmed. View "Cumulus Media New Holdings Inc. v. The Nielsen Co. (US), LLC" on Justia Law

The case centers on events that took place in December 2015 involving a man who was arrested by New York City police officers after allegations surfaced that he was holding a woman, Miranda, against her will and abusing her. The police received a report from Miranda’s aunt, Marisol Lopez, who claimed that Miranda was being beaten and forced to take drugs. Officers went to Lopez’s apartment, gathered information about Miranda and McClarin, then proceeded to 393 Warwick Street where Miranda was allegedly held. There, conflicting accounts emerged: McClarin and Miranda testified that police forcibly entered without a warrant and ransacked the apartment, while the officers claimed Miranda opened the door voluntarily and that exigent circumstances justified the entry. Miranda later provided a sworn statement accusing McClarin, but at trial testified the statement was coerced and false.The United States District Court for the Eastern District of New York presided over the jury trial. The jury found for the plaintiff on claims of unlawful search and malicious prosecution, awarding significant compensatory and punitive damages against several officers. The officers moved post-trial for judgment as a matter of law or a new trial, primarily arguing the exclusion of recorded conversations between McClarin and Miranda prejudiced their defense. The district court denied all post-trial motions, finding sufficient evidence for the jury’s verdict and ruling the exclusion appropriate because the recordings had not been disclosed before trial.On appeal, the United States Court of Appeals for the Second Circuit rejected the officers’ arguments for judgment as a matter of law, upholding the jury’s findings on the absence of exigent circumstances and qualified immunity. However, it found the district court erred in excluding the recordings, which were relevant to witness credibility and impeachment. The appellate court vacated the judgment against the officers and remanded for a new trial on the unlawful search and malicious prosecution claims. View "McClarin v. City of New York" on Justia Law

A coalition of trade associations, real estate brokerage firms, landlords, and related entities challenged New York City’s Fairness in Apartment Rental Expenses Act (FARE Act), passed in November 2024. The Act prohibits brokers from charging tenants fees for apartments where they have published listings with a landlord’s permission or agreed to work for the landlord, and prevents landlords from making rental conditional on prospective tenants hiring agents. The plaintiffs argued that the Act infringed their federal and state free speech rights, particularly by burdening their ability to publish listings and receive compensation, and violated the Contracts Clause of the U.S. Constitution by rendering certain existing agreements unenforceable.The United States District Court for the Southern District of New York heard the case, with the City opposing injunctive relief and moving to dismiss the claims. The district court dismissed the plaintiffs’ First Amendment claims, finding the FARE Act to be content-neutral regulation of commercial speech that survived intermediate scrutiny under the Central Hudson test. The court denied the plaintiffs’ motion for a preliminary injunction on those claims. As for the Contracts Clause argument, the district court denied the City’s motion to dismiss, reasoning that factual issues remained, but denied a preliminary injunction after finding plaintiffs unlikely to succeed on the merits. The district court also rejected a state preemption claim.The United States Court of Appeals for the Second Circuit reviewed the appeal, affirming the district court’s judgment. The Second Circuit held that the FARE Act regulates commercial speech in a content-neutral manner and is valid under the Central Hudson test. It also concluded that the Act does not violate the Contracts Clause, as plaintiffs failed to establish a substantial likelihood of success on that claim. The court thus affirmed denial of injunctive relief and dismissal of the constitutional claims. View "Real Estate Board of New York, Inc. v. The City of New York" on Justia Law

A group of parents, guardians, and children alleged that prenatal exposure to acetaminophen, the active ingredient in Tylenol and similar over-the-counter drugs, caused attention-deficit/hyperactivity disorder (ADHD) and/or autism spectrum disorder (ASD) in children. The defendants were manufacturers, pharmacies, and retailers of acetaminophen products. The plaintiffs’ claims centered on the companies’ alleged failure to warn about the risk of these neurodevelopmental disorders associated with prenatal acetaminophen use.These cases were consolidated and transferred to the United States District Court for the Southern District of New York. In the Rutledge action, the district court excluded all five of plaintiffs’ expert witnesses on general causation, concluding their methodologies were unreliable, and granted summary judgment to defendants. In the Phippen action, which involved only ADHD claims, the district court excluded another expert, Dr. Ness, and again granted summary judgment to defendants. The district court also rejected defendants’ arguments that federal drug labeling law preempted the plaintiffs’ claims, holding that federal law did not bar additional, specific pregnancy-related warnings.On appeal, the United States Court of Appeals for the Second Circuit reviewed whether the district court properly exercised its gatekeeping role under Federal Rule of Evidence 702 in excluding the plaintiffs’ expert testimony. The Second Circuit held that the district court exceeded its discretion in excluding the testimony of Drs. Baccarelli, Hollander, and Pearson, because their methodologies were consistent with those generally accepted in their fields and their reasoning was within the range of scientific debate. The appellate court affirmed the exclusion of testimony from Drs. Cabrera and Louie. In light of its rulings, the Second Circuit vacated the summary judgments, remanded both cases for further proceedings, and directed reconsideration of Dr. Ness’s exclusion in Phippen. The court also affirmed that federal law did not preempt the plaintiffs’ state-law failure-to-warn claims. View "Rutledge v. Walgreen Co." on Justia Law

New York State created a congestion-pricing program in 2019, requiring vehicles entering the Central Business District (CBD) in Manhattan to pay a daily toll. The stated purposes of the program include reducing traffic congestion and raising funds to support mass transit projects. Rockland and Orange Counties, neighboring municipalities with limited mass-transit access to Manhattan, argued that this program disproportionately burdens their residents, who often rely on driving rather than transit. Before the program began, Rockland and Orange Counties sued the Triborough Bridge and Tunnel Authority and the Metropolitan Transportation Authority, alleging that the toll was an unauthorized tax, violated the right to travel, and infringed upon the Due Process, Equal Protection, and Excessive Fines Clauses of both the New York and U.S. Constitutions.The United States District Court for the Southern District of New York consolidated the cases and granted the defendants’ motion to dismiss for failure to state a claim, also denying leave to amend. The court found that the plaintiffs failed to plausibly allege constitutional violations and determined that any challenge to the toll as a tax should be brought in state court.The United States Court of Appeals for the Second Circuit reviewed the appeal, assuming without deciding that the toll was not a tax. The Second Circuit affirmed the district court’s dismissal, holding that the congestion-pricing program does not create invidious distinctions or more than a minor restriction on the right to travel and thus is reviewed for reasonableness. The court found the toll to be a reasonable user fee, rationally related to legitimate state interests in funding transit and reducing congestion. It also determined there was no due process, equal protection, or excessive fines violation. The Second Circuit further ruled that the district court did not abuse its discretion in denying leave to amend the complaints. View "County of Rockland v. Triborough Bridge & Tunnel Auth." on Justia Law

A union representing over 100,000 current and former home healthcare workers in New York City entered into collective bargaining agreements (CBAs) with more than 40 employers. In 2015, the union and employers amended their CBAs with a Memorandum of Agreement (2015 MOA), mandating arbitration of statutory wage-and-hour claims, including those under the Fair Labor Standards Act and New York Labor Law. The union subsequently initiated a class arbitration in 2019 for wage claims dating back to 2008. The arbitrator found for the union, ordering employers to create a $30 million fund for affected workers and established a rapid payout process. The union sought, and the United States District Court for the Southern District of New York confirmed, the arbitration awards, making them binding on virtually all covered workers, except for nine individuals named in ongoing state litigation.Prior to the arbitration, several former employees who had left their jobs before the 2015 MOA was executed sued their employers in New York State courts, asserting similar wage claims. State courts uniformly held that these individuals, no longer union members or bargaining unit employees at the time of the 2015 MOA, could not be retroactively bound to arbitrate their claims. Despite this, the district court denied intervention by these former employees in the confirmation proceedings, concluding they lacked standing and were adequately represented by the union.The United States Court of Appeals for the Second Circuit reviewed the case. It held that the district court, not the arbitrator, must decide whether the union and employers clearly agreed to arbitrate these statutory claims. The Circuit Court found that the union and employers did not agree to mandatory arbitration for former employees’ accrued statutory claims until the 2015 MOA, and the union could not lawfully waive the rights of individuals who had already left employment. The Court vacated the district court’s orders as to the appellants and remanded for further proceedings, ruling these individuals are not bound by the arbitration awards and may pursue their claims in state court. View "1199 SEIU UNITED HEALTHCARE WORKERS EAST v. CHINESE-AMERICAN PLANNING COUNCIL HOME ATTENDANT PROGRAM" on Justia Law

Investors, referred to as the Opt-Out Plaintiffs, brought state court actions against Quasar Distributors, LLC, the underwriter of a collapsed mutual fund, after choosing not to participate in a class action settlement following the fund’s collapse. The collapse was caused by fraudulent inflation of asset values by the fund’s adviser, resulting in substantial losses. The Securities and Exchange Commission initiated a federal action in the United States District Court for the Southern District of New York, which oversaw the distribution of the remaining assets of the fund, known as the Special Reserve, through a court-appointed Special Master.While the class action settlement in New York state court resolved claims against several parties without drawing from the Special Reserve, the Opt-Out Plaintiffs pursued separate state law claims against Quasar and others. The District Court entered an order staying litigation, later amended to permit certain claims, but ultimately issued a permanent injunction against the Opt-Out Plaintiffs' state court actions against Quasar. The court reasoned that permitting these actions would create indemnification obligations for the fund, potentially depleting the Special Reserve and undermining its equitable distribution.On appeal, the United States Court of Appeals for the Second Circuit reviewed whether the injunction was permissible under the Anti-Injunction Act, 28 U.S.C. § 2283. The court held that the “in aid of jurisdiction” exception to the Act—which generally applies only to actions involving control over a specific property or res—did not justify enjoining the Opt-Out Plaintiffs’ state court in personam actions against Quasar. The court found that the Opt-Out Plaintiffs’ claims did not threaten federal jurisdiction over the Special Reserve, and the narrow exception recognized in In re Baldwin-United Corp. did not apply. Accordingly, the Second Circuit vacated the injunction and remanded the case for further proceedings. View "Mutual Fund Opt-Out Plaintiffs v. Calamari" on Justia Law

A company that had succeeded Bed Bath & Beyond after bankruptcy sued two investment entities, asserting that they owed the company profits made from short-term trading of its stock. Before the bankruptcy, Bed Bath & Beyond had sold derivative securities to the investment entities, giving them the right to acquire large amounts of its stock at a discount. However, the contracts for these derivatives included “blocker” provisions, which stated that the investment entities could not acquire more than 9.99% of the company’s stock at any time. The investment entities repeatedly exercised their rights under these contracts, buying and selling shares while maintaining their holdings below the 10% threshold.The United States District Court for the Southern District of New York reviewed the case after the successor company filed suit, arguing that the contractual blockers were illusory and that, in substance, the investment entities effectively had the right to acquire more than 10% of the stock, triggering liability under section 16(b) of the Securities Exchange Act of 1934. The district court dismissed the complaint, finding that the blockers were valid and shielded the defendants from section 16(b) liability.On appeal, the United States Court of Appeals for the Second Circuit reviewed the district court’s dismissal de novo. The court held that effective and enforceable contractual blockers, which cap an investor's beneficial ownership below 10% and are not sham provisions, prevent section 16(b) liability for short-swing profits. The court found no plausible allegations that the blockers were illusory or that the investment entities ever exceeded the 10% threshold. The Court of Appeals also rejected arguments that the parties’ contractual arrangements were part of a scheme to evade regulatory obligations. The judgment of the district court was affirmed in full. View "20230930-DK-BUTTERFLY-1,INC. v. HBC Invs. LLC" on Justia Law

A hospital and a union representing registered nurses entered into a collective bargaining agreement, which required the hospital to staff its Cardio-Thoracic Intensive Care Unit according to a specific grid. When the hospital failed to maintain the agreed-upon staffing levels, the union filed a grievance on behalf of the affected nurses. The dispute proceeded to arbitration, where the arbitrator found that the hospital had breached the agreement and issued a monetary award to compensate nurses who worked on significantly understaffed shifts.The United States District Court for the Southern District of New York reviewed cross-motions from both parties—one to vacate and one to confirm the arbitral award. The district court denied the hospital’s motion to vacate and granted the union’s motion to confirm the award, concluding that the arbitrator had acted within her authority under the agreement. The hospital appealed this decision, contending that the monetary relief was not authorized by the contract and that it constituted a punitive award in violation of public policy.The United States Court of Appeals for the Second Circuit affirmed the district court’s confirmation of the arbitral award. The court held that the arbitrator did not exceed her authority under the agreement, as the agreement’s remedial authority clause permitted the issuance of monetary relief and did not expressly prohibit such remedies. The court further found that the award was compensatory, not punitive, as it was intended to make the nurses whole for extra work performed, and was not designed to punish the hospital. The court concluded that the award did not violate any explicit public policy and that the arbitrator’s remedy was properly derived from the terms of the agreement. View "The New York and Presbyterian Hospital v. New York State Nurses Association" on Justia Law

A noncitizen defendant, a member of the MS-13 gang, pleaded guilty to assault in aid of racketeering after providing advice and supplies to junior gang members involved in a shooting. He was charged as part of a multi-defendant racketeering indictment covering violent crimes from 2016 to 2018. The defendant was sentenced to 210 months of imprisonment and three years of supervised release. One special condition of his supervised release required him to “cooperate with and abide by all instructions of immigration authorities.” The defendant did not object to this special condition during sentencing.The United States District Court for the Eastern District of New York imposed the sentence and adopted the presentence report’s recommendations, including the special conditions of supervised release. The defendant filed an appeal challenging only the “Immigration Authorities Condition,” arguing that it was procedurally unreasonable, unconstitutionally vague, and impermissibly delegated judicial authority to non-judicial officers. The government argued the appeal was barred by a waiver in the plea agreement, but the United States Court of Appeals for the Second Circuit determined that the waiver did not cover conditions of supervised release and denied the motion to dismiss.The United States Court of Appeals for the Second Circuit reviewed the case for plain error. The court held that the challenge was ripe, was not waived but forfeited, and that the district court’s reasons for imposing the condition were self-evident in the record. The court further held that the condition was not unconstitutionally vague and did not unlawfully delegate sentencing authority. The judgment of the district court, including the challenged special condition, was affirmed. View "United States v. Salvador" on Justia Law