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

A public hospital in New York contracted with a new parking management company to provide valet services, replacing a previous vendor whose employees were represented by a union and were covered by a collective bargaining agreement (CBA). After winning the contract, the new company considered retaining the existing unionized valet attendants but ultimately did not hire any of them, despite initially recruiting them. Instead, the company posted job listings for the same roles and hired other workers, leaving the former unionized employees without jobs. Evidence suggested that the new company’s refusal to hire was motivated by the employees’ union affiliation.After the union filed an unfair labor practice charge, the Regional Director of the National Labor Relations Board (NLRB) filed a petition with the United States District Court for the Eastern District of New York, seeking a temporary injunction under § 10(j) of the National Labor Relations Act. The requested injunction would have required the company to reinstate the discharged employees, recognize the union, and bargain in good faith. The district court denied the petition in a brief text order, finding no cognizable irreparable harm and noting the delay in seeking relief. Meanwhile, an Administrative Law Judge found that the company violated the Act by refusing to hire the unionized employees and failing to recognize and bargain with the union.The United States Court of Appeals for the Second Circuit reviewed the district court’s denial. The Second Circuit held that the district court’s order violated Rule 52(a)(2) by failing to provide adequate findings and conclusions. The Second Circuit further found that the Regional Director had met all four prongs required for a § 10(j) injunction: likelihood of success on the merits, irreparable harm, balance of equities, and public interest. The court reversed the district court’s order and remanded for entry of the requested injunction. View "Poor v. Parking Systems Plus, Inc." on Justia Law

A South Korean entertainment company that owns trademarks for the popular “Baby Shark” song and related products brought a lawsuit in the United States District Court for the Southern District of New York against dozens of China-based businesses. The company alleged these businesses manufactured or sold counterfeit Baby Shark merchandise, violating trademark, copyright, and unfair competition laws. Seeking to stop the alleged counterfeiting, the company obtained temporary and preliminary injunctions and moved to serve the defendants by email, arguing that this method was appropriate under Federal Rule of Civil Procedure 4(f)(3).After the plaintiff served process by email, most defendants did not respond, leading to default judgments against many of them. However, two defendants appeared and challenged the court’s jurisdiction, arguing that service by email violated the Hague Service Convention, to which both the United States and China are parties. The district court agreed, finding that the Convention did not permit service by email on parties in China, and dismissed the claims against these defendants without prejudice for improper service. The plaintiff appealed to the United States Court of Appeals for the Second Circuit.The United States Court of Appeals for the Second Circuit affirmed the district court’s decision. The appellate court held that the Hague Service Convention does not allow email service on defendants located in China, as China has expressly objected to alternative methods such as those in Article 10 of the Convention. The court further held that neither Federal Rule of Civil Procedure 4(f)(2) nor any purported emergency exception permitted email service in these circumstances. The court also upheld the denial of a default judgment, finding no abuse of discretion. Accordingly, the dismissal of the claims against the two China-based defendants for lack of proper service was affirmed. View "Smart Study Co., LTD v. Shenzhenshixindajixieyouxiangongsi" on Justia Law

Several parents of disabled children brought a class action against the New York City Department of Education, the Board of Education of the City School District of New York, and the Chancellor, alleging that the defendants violated the Individuals with Disabilities Education Act (IDEA). The plaintiffs claimed the defendants maintained a policy of discontinuing special education services to disabled students before their twenty-second birthday, despite federal and state guidance and previous case law indicating that such services should continue until that age.The United States District Court for the Southern District of New York dismissed the suit, finding that it lacked subject-matter jurisdiction because the plaintiffs had not exhausted administrative remedies as generally required under the IDEA. The district court agreed with the defendants’ argument that exhaustion was necessary and rejected the plaintiffs’ contention that exhaustion would be futile due to the existence of a blanket, citywide policy.On appeal, the United States Court of Appeals for the Second Circuit reviewed the district court’s dismissal. The appellate court clarified that the IDEA’s exhaustion requirement is not jurisdictional but is instead a claim-processing rule, meaning that failure to exhaust is not a bar to the court’s power to hear the case. The Second Circuit held that exhaustion of administrative remedies is excused when plaintiffs challenge a policy or practice of general applicability that is contrary to law and when the purposes of exhaustion—such as developing a factual record or utilizing agency expertise—would not be served. Because the plaintiffs’ claims raised a purely legal question regarding the validity of a blanket policy, the court found that exhaustion would be futile. The Second Circuit vacated the district court’s dismissal and remanded the case for further proceedings. View "J.M. v. New York City Dept. of Ed." on Justia Law

A former deputy executive director of a bi-state agency, the Port Authority of New York and New Jersey, was prosecuted in connection with the “Bridgegate” scandal. Although convicted, his convictions were ultimately vacated and the indictment dismissed. Having incurred approximately $4 million in legal expenses, he sought indemnification from the Port Authority under its bylaws, which provide for reimbursement of legal costs upon acquittal or dismissal of criminal charges, subject to certain notice and procedural requirements.After the Port Authority denied his request for indemnification, he commenced suit in New York state court. The Port Authority removed the case to the United States District Court for the Southern District of New York. There, the Port Authority argued that the court lacked subject matter jurisdiction because the plaintiff had not satisfied a condition precedent for suit—specifically, timely delivery of the judgment of acquittal per the bylaws—meaning that the necessary waiver of sovereign immunity had not occurred. The district court agreed, dismissing the case for lack of subject matter jurisdiction and subsequently denying leave to amend the complaint as futile, finding that the plaintiff had failed to plead compliance with the condition precedent.The United States Court of Appeals for the Second Circuit reviewed the dismissal. It held that the Port Authority does not possess state sovereign immunity from suit in federal court, as established by the Supreme Court in Hess v. Port Authority Trans-Hudson Corp., and therefore a failure to plead waiver of sovereign immunity does not deprive the federal court of subject matter jurisdiction. The court vacated the district court’s judgment and remanded for further proceedings, overruling prior circuit precedent to the contrary. The court also vacated the denial of leave to amend, clarifying that compliance with contractual or statutory conditions is an affirmative defense, not a jurisdictional prerequisite. View "Baroni v. Port Authority of New York and New Jersey" on Justia Law

A dispute arose between a manufacturer of construction equipment and its distributor over a 2012 distribution agreement. The distributor alleged that the manufacturer breached the agreement by selling covered equipment directly to third parties, bypassing the distributor. The manufacturer, in turn, counterclaimed that the distributor failed to pay amounts due under a 2016 rental agreement and for various purchases made between 2016 and 2017. Both parties sought damages and prejudgment interest related to their respective claims and counterclaims.The United States District Court for the Southern District of New York, after the completion of discovery, granted summary judgment for the distributor on liability for its breach-of-contract claim, leaving damages to be determined by a jury. The court also granted summary judgment for the manufacturer as to both liability and damages on its breach-of-contract counterclaim. A jury awarded the distributor substantial damages for the manufacturer’s breach. The district court denied the manufacturer’s post-trial motions for judgment as a matter of law and for a new trial or remittitur, and later awarded prejudgment interest to the distributor, despite the manufacturer’s objection that the request was untimely under Federal Rule of Civil Procedure 59(e).On appeal, the United States Court of Appeals for the Second Circuit addressed whether the distributor’s motion for prejudgment interest was timely. The court held that the initial judgment entered by the district court was not sufficiently final, as it omitted reference to the manufacturer’s successful counterclaim and the award of prejudgment interest. As a result, the 28-day deadline for a Rule 59(e) motion was not triggered until a later, comprehensive, final judgment was entered. The Second Circuit affirmed the district court’s award of prejudgment interest to the distributor. View "Alessi Equip., Inc. v. Am. Piledriving Equip., Inc." on Justia Law

Several individuals and a firearms association challenged provisions of New York’s Concealed Carry Improvement Act (CCIA) that require ammunition sellers to conduct background checks on purchasers, pay a $2.50 fee per check, and register with the Superintendent of the New York State Police. The plaintiffs alleged that these requirements deterred them from purchasing or selling ammunition, and that one plaintiff was unable to complete a purchase due to a system failure. They also claimed that dealers were passing the background check fee onto purchasers, and that the registration requirement deterred private sales.The United States District Court for the Western District of New York found that the association lacked standing but that the individual plaintiffs did have standing to challenge the provisions. The district court denied a preliminary injunction, concluding that the plaintiffs were unlikely to succeed on the merits of their Second Amendment claims because the state had shown that the provisions were consistent with the nation’s historical tradition of firearm regulation, as required by the framework set out in New York State Rifle & Pistol Ass’n, Inc. v. Bruen.On appeal, the United States Court of Appeals for the Second Circuit agreed that the individual plaintiffs had standing. However, the Second Circuit affirmed the denial of a preliminary injunction on different grounds. The court held that the plaintiffs failed to show that the background check, fee, and registration provisions meaningfully constrained their ability to “keep” or “bear” arms under the first step of the Bruen framework. Because the plaintiffs did not meet this threshold, the court did not address the historical analysis. The Second Circuit affirmed the district court’s order and remanded for further proceedings. View "N.Y. State Firearms Ass'n v. James" on Justia Law

The City of New York brought suit in New York state court against several major oil companies and the American Petroleum Institute, alleging violations of New York’s consumer protection laws through deceptive advertising about the environmental impact of fossil fuels. The defendants removed the case to the United States District Court for the Southern District of New York, asserting multiple grounds for federal jurisdiction. The City moved to remand the case to state court, but the district court stayed proceedings pending the outcome of a similar case, Connecticut v. Exxon Mobil Corp., in the United States Court of Appeals for the Second Circuit.After the Second Circuit affirmed the remand in the Connecticut case, the district court in New York lifted the stay and allowed the parties to re-brief the remand motion in light of the new precedent. The City renewed its motion to remand and requested attorneys’ fees and costs under 28 U.S.C. § 1447(c). The oil companies continued to oppose remand, pressing several arguments that had already been rejected by numerous federal courts, including the Second Circuit in the Connecticut case. The district court granted the motion to remand and awarded the City attorneys’ fees and costs, but only for work related to five of the six grounds for removal, and only for work performed after the Connecticut decision.On appeal, the United States Court of Appeals for the Second Circuit reviewed only the award of attorneys’ fees and costs. The court held that the district court did not abuse its discretion in awarding fees and costs for the objectively unreasonable grounds for removal pressed after the legal landscape had shifted. The Second Circuit affirmed the district court’s order, concluding that the award was justified under the “unusual circumstances” exception recognized in Martin v. Franklin Capital Corp. View "The City of New York v. Exxon Mobil Corp." on Justia Law

A group of local residents and an environmental organization alleged that a nonprofit entity operating a large compound in Deerpark, New York, was discharging stormwater and wastewater containing fecal coliform bacteria into nearby surface waters in violation of the Clean Water Act (CWA). The plaintiffs claimed that these discharges, which they supported with water testing data, exceeded legal limits and were the result of ongoing construction and improper maintenance of the defendant’s wastewater treatment plant. The affected waters are used by the plaintiffs for recreational purposes and are part of a larger watershed.Previously, the United States District Court for the Southern District of New York dismissed the plaintiffs’ initial complaint, finding that their pre-suit notice of intent to sue was deficient and thus failed to satisfy the CWA’s notice requirement. The court treated this requirement as jurisdictional and dismissed the case without prejudice. After the plaintiffs sent a new, more detailed notice and refiled their claims, the district court again dismissed the case, this time with prejudice under Rule 12(b)(6), holding that the revised notice still lacked sufficient information to enable the defendant to identify the alleged violations and the specific location of the discharges.On appeal, the United States Court of Appeals for the Second Circuit reviewed whether the CWA’s pre-suit notice requirement is jurisdictional and whether the plaintiffs’ notice was adequate. The Second Circuit held that the notice requirement under 33 U.S.C. § 1365(b) is not jurisdictional but is instead a mandatory condition precedent to suit. The court further found that the plaintiffs’ notice provided sufficient information to inform the defendant of the alleged violations, including the pollutant, the standards allegedly violated, and the location of the discharges. Accordingly, the Second Circuit vacated the district court’s dismissal and remanded the case for further proceedings. View "Mid-New York Environ. v. Dragon Springs" on Justia Law

Several plaintiffs, including an individual, an investment fund, and a limited partnership, engaged in trading derivatives tied to the Sterling London Interbank Offered Rate (Sterling LIBOR). They alleged that a group of major banks conspired to manipulate Sterling LIBOR for their own trading advantage. The plaintiffs claimed that the banks coordinated false submissions to the rate-setting process, sometimes inflating and sometimes deflating the benchmark, which in turn affected the value of Sterling LIBOR-based derivatives. The plaintiffs asserted that this manipulation was orchestrated through internal and external communications among banks and with the help of inter-dealer brokers.The United States District Court for the Southern District of New York reviewed the case and dismissed the plaintiffs’ claims under the Sherman Act and the Commodity Exchange Act (CEA). The district court found that two plaintiffs lacked antitrust standing because they were not “efficient enforcers” and had not transacted directly with the defendants, resulting in only indirect and remote damages. The court also determined that the third plaintiff, a limited partnership, lacked the capacity to sue and had not properly assigned its claims to a substitute entity. Additionally, the court found that one plaintiff failed to adequately plead specific intent for the CEA claims.On appeal, the United States Court of Appeals for the Second Circuit affirmed the district court’s dismissal, but on a narrower ground. The Second Circuit held that none of the plaintiffs plausibly alleged actual injury under either the Sherman Act or the CEA. The court explained that because the alleged manipulation was multidirectional—sometimes raising and sometimes lowering Sterling LIBOR—the plaintiffs did not show that they suffered net harm as a result of the defendants’ conduct. Without specific allegations of transactions where they were harmed by the manipulation, the plaintiffs’ claims could not proceed. The judgment of dismissal was affirmed, and the cross-appeal was dismissed as moot. View "Sonterra Cap. Master Fund, Ltd. v. UBS AG" on Justia Law

A hotel in the Town of Newburgh, New York, agreed to provide long-term housing to asylum seekers as part of a program initiated by New York City. In response, the Town alleged that the hotel’s actions violated local zoning and occupancy ordinances, which limited hotel stays to transient guests for no more than 30 days. The Town inspected the hotel, found modifications suggesting long-term use, and filed suit in the Supreme Court of the State of New York, Orange County, seeking to enjoin the hotel from housing asylum seekers for extended periods. The state court issued a temporary restraining order, but allowed the asylum seekers already present to remain pending further orders.The hotel removed the case to the United States District Court for the Southern District of New York, arguing that the Town’s enforcement was racially motivated and violated Title II of the Civil Rights Act of 1964, thus justifying removal under 28 U.S.C. § 1443(1). The district court found that removal was improper because the hotel had not sufficiently pleaded grounds for removal under § 1443(1), and remanded the case to state court.While the hotel’s appeal of the remand order was pending before the United States Court of Appeals for the Second Circuit, the underlying state court action was discontinued with prejudice after the asylum seekers left and the City ended its program. The Second Circuit determined that, because the state court case was permanently terminated, there was no longer a live controversy regarding removal. The court held the appeal was moot and, following standard practice when mootness occurs through no fault of the appellant, vacated the district court’s remand order and dismissed the appeal. View "Town of Newburgh v. Newburgh EOM LLC" on Justia Law