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

Plaintiffs, investment funds, filed suit seeking, by ex parte application, to discover certain documents from the defendant American and international accounting firms relating to audits conducted by their Middle Eastern affiliates. 28 U.S.C. 1782 provides assistance to litigants in proceedings before foreign and international tribunals. The statute authorizes a district court, “upon the application of any interested person,” to order a party “found” in the judicial district in which the court sits to produce discovery “for use” in a foreign proceeding. The court concluded that (1) assuming arguendo that the funds were “interested person[s]” in ongoing foreign proceedings, the funds did not establish that the evidence they sought was “for use” in those proceedings; and (2) the district court did not err in finding that additional proceedings that the funds asserted they intended to initiate were not “within reasonable contemplation” at the time the application was made. Accordingly, the court affirmed the district court's denial of the application. View "Certain Funds v. KPMG LLP" on Justia Law

This appeal stems from actions filed by holders of Argentina's bonds after the Republic of Argentina defaulted on sovereign debt. After previous panels of this court twice vacated aggregate judgments entered by the district court in favor of plaintiff classes, the court remanded with specific instructions. The district court, however, certified expanded plaintiff classes. The court concluded that the district court erred in following Hickory Sec. Ltd. v. Republic of Argentina's (Seijas II) mandate where, even though it did not expressly preclude recertification, Seijas II cannot be read to have permitted the district court to disregard the court's instructions and expand the plaintiff classes as a solution to a problem for which the court had already prescribed a specific response. Accordingly, the court vacated the district court's orders and remanded. View "Puricelli v. Republic of Argentina" on Justia Law

This appeal stems from actions filed by holders of Argentina's bonds after the Republic of Argentina defaulted on sovereign debt. After previous panels of this court twice vacated aggregate judgments entered by the district court in favor of plaintiff classes, the court remanded with specific instructions. The district court, however, certified expanded plaintiff classes. The court concluded that the district court erred in following Hickory Sec. Ltd. v. Republic of Argentina's (Seijas II) mandate where, even though it did not expressly preclude recertification, Seijas II cannot be read to have permitted the district court to disregard the court's instructions and expand the plaintiff classes as a solution to a problem for which the court had already prescribed a specific response. Accordingly, the court vacated the district court's orders and remanded. View "Puricelli v. Republic of Argentina" on Justia Law

Plaintiff appealed from the district court's refusal to enter the parties' stipulation of settlement dismissing, with prejudice, plaintiff's claims under the Fair Labor Standards Act (FLSA), 29 U.S.C. 216(c), and New York Labor Law. The court agreed with the district court's holding that parties cannot enter into private settlements of FLSA claims without either the approval of the district court or the DOL. Therefore, in the absence of such approval, parties cannot settle their FLSA claims through a private stipulated dismissal with prejudice pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(ii). Accordingly, the court affirmed and remanded for further proceedings. View "Cheeks v. Freeport Pancake House, Inc." on Justia Law

Plaintiffs are commercial trucking companies, their national trade association, and a putative class of commercial truckers. Plaintiff filed suit against the Thruway Authority under 42 U.S.C. 1983, alleging that the Thruway Authority charges excessive tolls in violation of the Commerce Clause because it diverts excessive highway tolls to fund maintenance and improvements of unrelated projects. The district court dismissed the suit under Rule 12(b)(7) for failure to join the State of New York as a necessary party under Rule 19. The court reversed and remanded, concluding that the district court abused its discretion because the State of New York is not a necessary party under Rule 19(a). View "Am. Trucking Ass'n v. N.Y. State Thruway Auth." on Justia Law

Plaintiffs appealed the dismissal of their putative shareholder derivative actions against Facebook and its directors and lead underwriters. Plaintiffs alleged that Facebook’s directors breached duties owed to the company because its Registration Statement failed to disclose the mid‐quarter impact of mobile usage on the company’s projected growth. The court concluded that it was not error for the district court to decide, as a threshold matter, whether plaintiffs adequately pleaded contemporaneous share ownership, as required by Federal Rule of Civil Procedure 23.1. The court affirmed the judgment because none of the putative plaintiffs satisfied this requirement. The court did not reach the additional bases for dismissal raised by the district court or Facebook. View "In re Facebook, Inc. IPO Derivative Litig." on Justia Law

Plaintiff appealed the district court's dismissal of his complaint under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). The court affirmed the dismissal of plaintiff's wrongful termination claims because the court concluded that an affidavit attached as an exhibit to a complaint is not a "written instrument" that is deemed part of the complaint under Rule 10(c); affirmed the dismissal of plaintiff's remaining claims for lack of standing and for failure to state a claim upon which relief can be granted; and affirmed the district court's denial of plaintiff's motion for leave to amend his complaint, a motion which was first made following the entry of the final judgment. View "Smith v. Hogan" on Justia Law

Applicant appealed the district court's denial of her application to compel discovery from respondent under 28 U.S.C. 1782. Applicant sought discovery from respondent to plead and to prove a contemplated defamation suit against him in her home country of the Netherlands. The district court denied the application on the ground that the materials sought were not “for use” in the Dutch proceeding, as required by section 1782, because they were not necessary for applicant to draft an adequate complaint. The court concluded that the district court's conclusion was erroneous because an applicant may satisfy the statute’s “for use” requirement even if the discovery she seeks is not necessary for her to succeed in the foreign proceeding and because the discovery need not be sought for the purpose of commencing a foreign proceeding in order to be “for use” in that proceeding. That is so even where a section 1782 applicant is a private litigant who has yet to commence the foreign proceeding for which discovery is sought, so long as the proceeding is within reasonable contemplation. A section 1782 applicant, such as the case here, satisfies the statute’s “for use” requirement by showing that the materials she seeks are to be used at some stage of a foreign proceeding. Accordingly, the court vacated and remanded. View "Mees v. Buiter" on Justia Law

Plaintiff, a New York corporation, filed suit attempting to collect money owed to it under defaulted Sub Notes issued by a now-dissolved entity, Hellas. On appeal, plaintiff argued that the district court erred in granting defendantsʹ motion to dismiss its complaint for lack of subject matter jurisdiction pursuant to Fed. R. Civ. P. 12(b)(1). Plaintiff also argued that the district court erred in failing to grant to it the opportunity to cure any standing defect under Fed. R. Civ. P. 17(a)(3). The court affirmed the judgment, concluding that plaintiff has not carried its burden of showing a valid assignment of a claim. Nor has plaintiff pointed to anything in the assignment, or to other evidence in the record, suggesting that title to claims arising under the Sub Notes was assigned to it. Although the court determined that plaintiff did not forfeit its rights under Rule 17, the court concluded that the district courtʹs decision to deny relief under that rule was not an abuse of discretion because neither of the requests made by plaintiff in its effort to cure the standing problem would have been consistent with Rule 17(a)(3). Accordingly, the court affirmed the judgment. View "Cortlandt St. Recovery Corp. v. Hellas Telecommunications" on Justia Law

This derivative action arose out of the London Whale trading debacle. Plaintiff, a JPMorgan shareholder, filed suit seeking to compel JPMorgan to take action, up to and including suing the alleged wrongdoers. The district court dismissed the complaint, finding that plaintiff had not pleaded facts showing that the JPMorgan Board of Directors had wrongfully refused the demand for action. The court noted that the abuse‐of‐discretion standard of review for the dismissal of derivative action cases should be retired, and that dismissals of derivative actions should be reviewed under the same de novo standard that the court followed in all other similarly situated cases. However, because the court is bound by the rule of the Circuit, the court concluded that the district court did not abuse its discretion by dismissing this derivative action. Accordingly, the court affirmed the judgment. Finally, the district court did not err by denying plaintiff an opportunity to amend his complaint. View "Espinoza v. Dimon" on Justia Law