Justia U.S. 6th Circuit Court of Appeals Opinion Summaries

A group of car owners from ten states sued Nissan, alleging that certain models equipped with automatic electronic braking systems had a defect causing "phantom activations" at inappropriate times, such as at railroad crossings or in parking garages. The plaintiffs claimed this defect breached warranties, constituted fraud, violated consumer protection statutes, and unjustly enriched Nissan. They sought to certify ten statewide classes of owners or lessees of the affected models.The United States District Court for the Middle District of Tennessee certified the ten classes under Civil Rule 23(b)(3), finding that the plaintiffs had demonstrated common questions of law or fact. Nissan appealed, arguing that the classes did not meet the requirements for certification, particularly due to differences in the software updates that had been applied to the braking systems over time.The United States Court of Appeals for the Sixth Circuit reviewed the case and found that the district court had not conducted a rigorous analysis of the commonality requirement. The appellate court noted that the district court failed to consider the material differences in the software updates and how these differences might affect the existence of a common defect. Additionally, the district court did not analyze the elements of each state law claim to determine whether they could be resolved with common answers.The Sixth Circuit vacated the district court's certification of the classes and remanded the case for further proceedings. The appellate court emphasized the need for a detailed examination of the elements of each claim and the impact of the software updates on the alleged defect. The court also held that the district court must perform a Daubert analysis to ensure the reliability of the plaintiffs' expert testimony, which was critical to establishing the commonality of the defect across the different models and software versions. View "IN RE: NISSAN NORTH AMERICA,INC. LITIGATION" on Justia Law

Plaintiffs, a group of consumers, alleged that Strange Honey Farm, LLC, fraudulently marketed its honey products as "100% raw Tennessee honey." They claimed the honey was not raw, as it was heated during processing, not purely honey, as it was diluted with corn syrup, and not from Tennessee, as it was sourced from Vietnam. Plaintiffs filed a complaint against Strange Honey, its owners, and two supermarket chains that sold the honey, asserting fraudulent misrepresentation and violations of various state consumer protection laws.The United States District Court for the Eastern District of Tennessee dismissed the claims against all defendants except one, citing a lack of specificity required by Federal Rule of Civil Procedure 9(b). The court also denied plaintiffs' motion for leave to amend their complaint. Plaintiffs then voluntarily dismissed the remaining defendant and appealed the district court's decisions.The United States Court of Appeals for the Sixth Circuit reviewed the case and addressed several jurisdictional issues. The court determined that it had jurisdiction to hear the appeal because the district court's eventual entry of final judgment, after the premature notice of appeal, ripened the appellate jurisdiction. On the merits, the Sixth Circuit affirmed the district court's dismissal, finding that the plaintiffs' complaint failed to meet the specificity requirements of Rule 9(b). The court noted that the complaint did not adequately allege why the statements on the honey labels were false or when the statements were made to the plaintiffs. The court also upheld the district court's denial of leave to amend, concluding that the proposed amendments would be futile as they did not cure the deficiencies in the original complaint. View "Greer v. Strange Honey Farm" on Justia Law

Plaintiffs from twenty-six states sought class certification in their lawsuit against General Motors, LLC (GM) for alleged defects in the 8L45 and 8L90 transmissions of vehicles purchased between 2015 and 2019. Plaintiffs experienced "shudder" and shift quality issues that persisted despite repairs. GM argued that the class lacked standing and that individualized issues would predominate over common issues in the class-action suit.The United States District Court for the Eastern District of Michigan determined that the Plaintiffs had standing and could satisfy Federal Rule of Civil Procedure 23, thus certifying the class. GM appealed, claiming the district court abused its discretion in certifying the class.The United States Court of Appeals for the Sixth Circuit reviewed the case and held that the Plaintiffs had standing, as they alleged overpayment for defective products, which suffices for Article III standing. The court also found that the district court did not abuse its discretion in certifying the class, as the common questions of law and fact predominated over individualized issues. The court addressed GM's arguments regarding state laws requiring manifest defects, reliance, causation, and merchantability, concluding that these issues did not preclude class certification. The court also held that GM had waived its right to arbitration by engaging in litigation and seeking dispositive rulings on the merits.The Sixth Circuit affirmed the district court's class certification, allowing the class-action lawsuit against GM to proceed. View "Speerly v. General Motors, LLC" on Justia Law

A group of consumers who purchased or leased 2011-2016 GM Silverado or Sierra trucks with Duramax diesel engines sued General Motors LLC and Robert Bosch entities. They alleged that GM falsely advertised the trucks as having "clean diesel" technology with low emissions, while the vehicles actually emitted pollutants at levels much higher than advertised and above EPA standards. The plaintiffs claimed violations of state consumer protection laws, fraud, deceptive trade practices, and the Racketeer Influenced and Corrupt Organizations (RICO) Act.The United States District Court for the Eastern District of Michigan granted summary judgment in favor of the defendants. The court found that the plaintiffs' state-law claims were preempted by the Clean Air Act (CAA) and that the plaintiffs lacked standing to bring RICO claims because they were indirect purchasers.The United States Court of Appeals for the Sixth Circuit reviewed the case. The court held that the plaintiffs' state-law claims were not preempted by the CAA. The court distinguished this case from a previous decision, In re Ford Motor Co. F-150 and Ranger Truck Fuel Economy Marketing and Sales Practices Litigation, noting that the plaintiffs' claims did not challenge EPA determinations but rather focused on GM's misleading advertisements to consumers. The court emphasized that the state-law claims were based on traditional state tort law and did not depend on proving fraud against the EPA.However, the court affirmed the district court's decision regarding the RICO claims. The court held that the plaintiffs, as indirect purchasers, lacked standing to bring RICO claims under the indirect-purchaser rule, which bars suits by consumers who are two or more steps removed from the violator in a distribution chain.In conclusion, the Sixth Circuit reversed the district court's grant of summary judgment on the state-law claims, allowing those claims to proceed, but affirmed the summary judgment on the RICO claims, barring those claims. View "Fenner v. General Motors, LLC" on Justia Law

Thomas Merck applied for an entry-level position at Walmart and was given a conditional job offer pending a background check. Merck failed to disclose an old misdemeanor conviction, which was discovered during the background check. Walmart, through a third-party vendor, provided Merck with an incomplete version of the report, which indicated he was "not competitive" for the job. Walmart then revoked the job offer. Merck claimed that Walmart violated the Fair Credit Reporting Act by not providing him with the full consumer report before taking adverse action.The United States District Court for the Southern District of Ohio initially denied Walmart's motion to dismiss, finding that Merck had standing based on a procedural violation of the Act. However, after the Supreme Court's decision in TransUnion LLC v. Ramirez, which clarified the requirements for standing under the Fair Credit Reporting Act, Walmart renewed its motion for summary judgment. The district court granted the motion, concluding that Merck had not demonstrated a concrete injury as required by TransUnion.The United States Court of Appeals for the Sixth Circuit reviewed the case and affirmed the district court's decision. The court held that Merck failed to show he suffered adverse effects from the denial of the full consumer report. Specifically, Merck did not provide evidence that he could have used the withheld information to his benefit, such as changing the outcome of his job application or affecting his subsequent job search. The court also rejected Merck's analogy to procedural due process claims and traditional common-law harms, finding that the statutory duty under the Fair Credit Reporting Act did not closely resemble these traditional harms. Therefore, Merck did not have constitutional standing to sue Walmart. View "Merck v. Walmart, Inc." on Justia Law

Adam N. Berry alleged that Experian Information Solutions, a consumer reporting agency, negligently or willfully published inaccurate information in his consumer report, indicating he owed spousal and child support. Berry provided Experian with court orders that purportedly showed he had no outstanding support obligations, but Experian continued to report a balance due as indicated by the Michigan Office of Child Support (OCS).The United States District Court for the Eastern District of Michigan granted Experian’s motion for judgment on the pleadings. The district court reasoned that the Fair Credit Reporting Act (FCRA) required Experian to report any information received from OCS about Berry’s failure to pay support. The court concluded that because Experian was required to report the unpaid balance and had verified the information’s accuracy with OCS, Berry’s claims were not actionable.The United States Court of Appeals for the Sixth Circuit reviewed the case and reversed the district court’s decision. The appellate court held that Berry sufficiently pleaded that Experian did not adopt reasonable procedures to ensure maximum possible accuracy and did not reasonably reinvestigate Berry’s consumer report after he challenged its accuracy. The court emphasized that the FCRA requires consumer reporting agencies to adopt reasonable procedures to assure maximum possible accuracy and to conduct a reasonable reinvestigation if a consumer disputes the report’s accuracy. The court found that Experian’s reliance on automated verification with OCS, without further investigation into the court orders provided by Berry, was insufficient. The case was remanded for further proceedings consistent with the appellate court’s opinion. View "Berry v. Experian Information Solutions" on Justia Law

Michigan First Credit Union reimbursed its customers for unauthorized electronic fund transfers resulting from a SIM Swap scam involving T-Mobile USA, Inc. Michigan First sought to recover these funds from T-Mobile, claiming indemnification or contribution under the Electronic Fund Transfer Act (EFTA) and state law. The district court dismissed the complaint, ruling that Michigan First failed to state a claim for indemnification or contribution under both the EFTA and state law.The United States District Court for the Eastern District of Michigan dismissed Michigan First’s claims, finding no basis for indemnification or contribution under the EFTA or state law. Michigan First appealed, arguing that the EFTA implies a right to indemnification or contribution, that the Michigan Electronic Funds Transfer Act (MEFTA) is not preempted by the EFTA, and that its state common-law indemnification claim should stand.The United States Court of Appeals for the Sixth Circuit reviewed the case de novo. The court held that the EFTA does not imply a right to indemnification or contribution for financial institutions, as the statute is designed to protect consumers, not financial institutions. The court also found that the EFTA preempts the MEFTA and any state common-law claims for indemnification or contribution, as allowing such claims would conflict with the EFTA’s comprehensive regulatory scheme. Consequently, the Sixth Circuit affirmed the district court’s dismissal of Michigan First’s complaint. View "Michigan First Credit Union v. T-Mobile USA, Inc." on Justia Law

The case involves a group of bettors who sued Churchill Downs, Inc., and trainers Robert Baffert and Bob Baffert Racing, Inc., after the horse they bet on, Medina Spirit, was disqualified from the 2021 Kentucky Derby due to a failed post-race drug test. The bettors claimed that they would have won their bets under the new order of finish after Medina Spirit's disqualification. However, under Kentucky law, only the first order of finish marked "official" counts for wagering purposes. The plaintiffs brought claims for negligence, breach of contract, violation of the Kentucky Consumer Protection Act, and unjust enrichment.The case was initially heard in the United States District Court for the Western District of Kentucky, which granted the defendants' motions to dismiss and denied the plaintiffs leave to amend the complaint. The court found that the plaintiffs' claims were based on the theory that they had "unpaid winning wagers," but under Kentucky law, the first official order of finish is final. Therefore, the plaintiffs' wagers were lost, and the complaint failed to state a claim upon which relief could be granted.The case was then appealed to the United States Court of Appeals for the Sixth Circuit. The appellate court affirmed the lower court's decision, agreeing that the plaintiffs' claims were based on the theory that they had "unpaid winning wagers." However, under Kentucky law, the first official order of finish is final for wagering purposes. Therefore, the plaintiffs' wagers were lost, and the complaint failed to state a claim upon which relief could be granted. The court also found that the proposed amendment to the complaint did not cure this flaw, so the lower court properly denied leave to amend. View "Mattera v. Baffert" on Justia Law

The case involves a truck driver, Frank McKenna, who sued his former employer, Dillon Transportation, LLC, for defamation based on a report Dillon sent to HireRight, a consumer reporting agency. The report claimed McKenna had an unsatisfactory safety record and had been involved in an accident. McKenna alleged the report was defamatory and resulted in his inability to secure employment. Dillon argued that the Fair Credit Reporting Act (FCRA) preempted McKenna’s claims.The United States Court of Appeals for the Sixth Circuit affirmed the district court's decision granting summary judgment in favor of Dillon. The court ruled that the FCRA does preempt McKenna's defamation claim. The court determined that under the FCRA, McKenna was a consumer, HireRight was a consumer reporting agency, and Dillon was a furnisher of information. The court found that the FCRA's preemption clause applied in this case, as it preempts state causes of action based on providing information to consumer reporting agencies like HireRight.Additionally, the court rejected McKenna’s argument that his suit was authorized under a Department of Transportation regulation that requires motor carriers to investigate the safety performance history of drivers, which preempts certain state-law claims against those providing such information. The court found the two preemption statutes, the FCRA, and the Department of Transportation regulation, complemented each other and could coexist. The court also ruled that the district court did not err in denying McKenna's request to postpone summary judgment to obtain additional documents related to his accident. View "McKenna v. Dillon Transportation, LLC" on Justia Law

FedEx Ground Package Systems, Inc. (FXG) filed a lawsuit against Route Consultant, Inc., alleging that the latter company had made nine false or misleading statements about FXG's business practices. FXG contended that these statements were intended to foster discontent between FXG and its contractors, thereby damaging FXG and benefiting Route Consultant. The suit was brought under both the Lanham Act's false advertising provision and the Tennessee Consumer Protection Act's statutory disparagement provision.The United States Court of Appeals for the Sixth Circuit confirmed the lower court's decision to dismiss the case. The court found that FXG had failed to plausibly allege that Route Consultant made a single false or misleading statement. The court emphasized that only statements of fact--not opinions, puffery, or rhetorical hyperbole--are actionable under the false advertising provision of the Lanham Act. Moreover, a plaintiff must plead and prove the literal falsity of the defendant's statement or demonstrate that the statement is misleading. FXG's complaint did not meet these standards.The court also held that FXG's claim under the Tennessee Consumer Protection Act failed for the same reasons as its Lanham Act claim. Thus, the court affirmed the district court's dismissal of FXG's lawsuit against Route Consultant. View "FedEx Ground Package Systems, Inc. v. Route Consultant, Inc." on Justia Law