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

Plaintiff Stacy Cales, a nurse practitioner, owned Road to Recovery, LLC, a substance abuse treatment business in West Virginia. In 2020, Cales engaged attorney Kristopher Justice, from the Ohio firm Theisen Brock, LPA, to assist in selling her business. Justice drafted sales documents, including a Promissory Note that defined payment terms and specified a liquidated damages amount in the event of default. Cales expressed concern to Justice about the damages provision, fearing it would limit her recovery if the buyer defaulted. Justice reassured her that the contract’s implied covenant of good faith would prevent the buyer from exploiting the provision. After the buyer ceased payments, litigation ensued in West Virginia, where the buyer asserted that damages should be limited to the liquidated amount. Dissatisfied with her representation and the contract, Cales hired a new attorney, who later advised her that she was entitled only to liquidated damages, prompting her to settle.Plaintiffs subsequently filed a legal malpractice claim and a vicarious liability claim in the United States District Court for the Southern District of Ohio. Both sides moved for summary judgment. The district court granted summary judgment for defendants, holding that the Ohio one-year statute of limitations barred plaintiffs' claims. The court reasoned that the statute began running when Cales terminated her prior attorney in March 2022, as that constituted a “cognizable event.”On appeal, the United States Court of Appeals for the Sixth Circuit held that the statute of limitations began on April 13, 2023, when Cales was advised by her new attorney about the consequence of the liquidated damages provision. Since the complaint was filed within one year of that date, the claims were timely. The appellate court reversed the district court’s judgment and remanded for further proceedings. View "Cales v. Theisen Brock LPA" on Justia Law

MTG, Inc., a company specializing in tooling for the auto industry, filed for Chapter 11 bankruptcy in 1995, which was later converted to a Chapter 7 proceeding in 1996. Charles Taunt was appointed as the Chapter 7 trustee and, during his tenure, entered into a fee agreement with Comerica Bank, MTG's largest secured creditor. Taunt failed to disclose this agreement to the bankruptcy court, despite rules requiring disclosure of such connections. Several orders were issued during this time that benefited Comerica, including allowance of its claim, relief from stay, and settlement of pre-petition lender liability claims. After Taunt's undisclosed conflict of interest was revealed, litigation ensued over whether the resulting orders should be set aside and whether Taunt, his law firms, and Comerica were liable for fraud, conversion, and unauthorized transfers.Following discovery of Taunt's conflict, the United States Bankruptcy Court for the Eastern District of Michigan vacated the orders benefitting Comerica and found Taunt and his law firm had committed fraud on the court. Taunt was disqualified as trustee, his firm was denied fees, and Guy Vining was appointed as successor trustee. Vining initiated an adversary proceeding with multiple claims, primarily post-petition claims alleging fraud on the court, avoidable transfers, and conversion. The bankruptcy court granted summary judgment for defendants on most claims, awarding only limited attorney’s fees for exposing the fraud. The United States District Court for the Eastern District of Michigan affirmed these rulings.The United States Court of Appeals for the Sixth Circuit reviewed the case and affirmed the district court’s decision. The court held Comerica was not directly or vicariously liable for fraud on the court, as it was not an officer of the court and did not control Taunt. The court also ruled that the challenged post-petition transfers were authorized by valid court orders and thus not avoidable under bankruptcy law. Finally, the court found Taunt’s actions as trustee were authorized, rejecting the conversion claim. The limited attorney’s fees award and denial of punitive damages were upheld as within the bankruptcy court’s discretion. View "Vining v. Plunkett Cooney, P.C." on Justia Law

HRT Enterprises pursued a takings claim against the City of Detroit after losing a jury verdict in state court in 2005. Subsequently, HRT filed suit in federal court in 2008, alleging a post-2005 violation under 42 U.S.C. § 1983. The United States District Court for the Eastern District of Michigan dismissed the federal action, citing the requirement from Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City, 473 U.S. 172 (1985), to exhaust state remedies first. HRT then returned to state court, where its claim was dismissed on claim preclusion grounds, a decision affirmed by the Michigan Court of Appeals. After the state court denied compensation, HRT initiated a federal § 1983 action in 2012. The case was stayed when the City filed for bankruptcy, prompting HRT to participate in bankruptcy proceedings to protect its compensation rights. Ultimately, the bankruptcy court excepted HRT’s takings claim from discharge, allowing the federal case to proceed. After two jury trials, the district court entered judgment for HRT in September 2023.Following its success, HRT moved for attorney fees under 42 U.S.C. § 1988, presenting billing records that included work from related state and bankruptcy proceedings. The district court applied a 33% discount to the claimed hours due to commingled and poorly described entries, set an average hourly rate, and awarded $720,486.25, which included expert witness fees. Both parties appealed aspects of the fee award to the United States Court of Appeals for the Sixth Circuit.The Sixth Circuit held that the district court erred by concluding it had no discretion to award fees for work performed in the related state-court and bankruptcy proceedings, as such fees are recoverable when the work is necessary to advance the federal litigation. The court also found the district court erred in awarding expert witness fees under § 1988(c) in a § 1983 action, as the statute does not authorize such fees for § 1983 claims. The appellate court vacated the fee award and remanded for recalculation consistent with its opinion. View "HRT Enterprises v. City of Detroit" on Justia Law

In the early months of the COVID-19 pandemic, Ohio ordered the closure of "non-essential businesses." A group of dance-studio owners filed a lawsuit in federal court, alleging that various state and local officials had violated their constitutional rights by issuing these orders. The district court dismissed the complaint for failure to state a claim, and the United States Court of Appeals for the Sixth Circuit affirmed this dismissal on August 22, 2022. The appellate court held that the plaintiffs lacked standing against all defendants except former Ohio Director of Public Health Amy Acton and that the plaintiffs' substantive-due-process and equal-protection claims failed under rational-basis review. The court also affirmed the district court's rejection of the plaintiffs' takings claim.After the appellate court affirmed the dismissal, the district court issued a sanctions order against the plaintiffs' attorneys, Thomas B. Renz and Robert J. Gargasz, for their extensive legal failings throughout the case. The attorneys appealed the sanctions order. The United States Court of Appeals for the Sixth Circuit reviewed the case and affirmed the district court's decision to impose sanctions. The appellate court agreed that the attorneys had violated Rule 11 by presenting a complaint that was haphazard, incomprehensible, and littered with factual and legal errors. The court also upheld the imposition of sanctions under 28 U.S.C. § 1927, finding that the attorneys had unreasonably and vexatiously multiplied the proceedings with frivolous claims.The appellate court concluded that the district court did not abuse its discretion in granting sanctions and awarding attorney's fees and costs. The court emphasized that the attorneys' conduct fell short of the obligations owed by members of the bar and that the extreme sanction of attorney's fees was warranted given the egregious nature of their legal failings. The appellate court affirmed the district court's holding that the attorneys violated Rule 11 and section 1927 and upheld the grant of attorney's fees and costs. View "Bojicic v. DeWine" on Justia Law

Debra Tucker applied for disability insurance benefits under Title II of the Social Security Act in 2018. After multiple denials at the administrative level, she appealed to the federal district court. In 2023, the district court reversed the final administrative decision of the Commissioner of Social Security, remanding Tucker’s claim for further administrative proceedings. The district court awarded Tucker’s attorney $7,500 in attorney’s fees under the Equal Access to Justice Act (EAJA), along with $402 in costs. Tucker’s attorney had a contingency-fee agreement for twenty-five percent of any past-due benefits awarded. In August 2024, an administrative law judge found Tucker disabled and granted her monthly disability benefits retroactive to February 2018, totaling $124,821.70 in past-due benefits.The district court granted in part and denied in part the attorney’s motion for $31,205.43 in fees under 42 U.S.C. § 406(b), awarding $17,400 instead. The court found the requested fee excessive, amounting to a windfall, and set an imputed hourly rate of $500. The attorney’s motion for reconsideration, reducing the fee request to $22,620, was denied. The attorney appealed, seeking the full $31,205.43.The United States Court of Appeals for the Sixth Circuit reviewed the district court’s decision for abuse of discretion. The appellate court found that the district court properly started with the contingency-fee agreement and then tested it for reasonableness, considering the effective hourly rate and other factors. The district court did not misapply the law by comparing the effective hourly rate to the EAJA rate and the attorney’s ordinary rate. The appellate court affirmed the district court’s decision, concluding that it acted within its discretion in reducing the fee to avoid a windfall. View "Tucker v. Commissioner of Social Security" on Justia Law

Several hundred children in Benton Harbor, Michigan, suffered from elevated lead levels in their blood after drinking lead-contaminated water from the city’s public water system for three years. Plaintiffs, represented by their guardians, filed a lawsuit against various state and city officials, as well as two engineering firms, alleging that these parties failed to mitigate the lead-water crisis and misled the public about the dangers of the drinking water. The claims included substantive-due-process and state-created-danger claims under 42 U.S.C. § 1983, as well as state-law negligence claims.The U.S. District Court for the Western District of Michigan dismissed the complaint in full. The court found that the plaintiffs did not plausibly allege a violation of their constitutional rights and declined to exercise supplemental jurisdiction over the state-law claims. Plaintiffs appealed the dismissal of their federal claims against the city and state officials and the state-law claims against one of the engineering firms.The United States Court of Appeals for the Sixth Circuit reviewed the case. The court affirmed the dismissal of the claims against the state officials, finding that the plaintiffs did not plausibly allege that these officials acted with deliberate indifference. However, the court reversed the dismissal of the claims against the city officials and the City of Benton Harbor, finding that the plaintiffs plausibly alleged that these officials misled the public about the safety of the water, thereby causing the plaintiffs to drink contaminated water. The court also reversed the district court’s declination of supplemental jurisdiction over the state-law claims against the engineering firm and remanded the case for further proceedings. The court affirmed the district court’s denial of leave to amend the complaint. View "Mitchell v. City of Benton Harbor" on Justia Law

Amaury Villa participated in two significant burglaries in 2011, stealing $61 million worth of pharmaceuticals from an Eli Lilly warehouse in Connecticut and $1.5 million worth of cigarettes from a warehouse in Kentucky. He was indicted by federal grand juries in Florida, Connecticut, and Kentucky. Villa pled guilty in the Florida and Connecticut cases, receiving concurrent prison terms of 140 and 98 months, respectively. In January 2016, Kentucky prosecutor Joshua Judd emailed Villa’s attorney, Donald Meier, a proposed plea agreement that did not mention concurrent sentencing. Villa later pled guilty without a plea agreement and was sentenced to 77 months, to be served consecutively.Villa moved to set aside his Kentucky sentence under 28 U.S.C. § 2255 in January 2019, claiming ineffective assistance of counsel. He later sought to amend his motion to add a claim that Meier failed to inform him of a potential cooperation agreement. The district court initially denied the motion as untimely. On appeal, the Sixth Circuit remanded for an evidentiary hearing on the timeliness of the claim. The district court found the claim timely but denied it on the merits.The United States Court of Appeals for the Sixth Circuit reviewed the case and affirmed the district court’s decision. The court found that Judd’s January 21 email did not constitute a formal plea offer but was an invitation to negotiate. The court also found that Meier had informed Villa of the January 9 plea offer, which was discussed at Villa’s change-of-plea hearing. The court concluded that Meier’s performance was not deficient and that Villa himself impeded further negotiations by refusing to provide additional information about his co-conspirator. The district court’s judgment denying Villa’s motion to vacate, set aside, or correct his sentence was affirmed. View "Villa v. United States" on Justia Law

In 1979, Karu Gene White, along with two accomplices, committed a brutal home invasion and murder of three elderly individuals in Kentucky. White, who had known the victims, planned the crime to steal money they had saved. The victims were beaten to death with a crowbar and other weapons. White was subsequently arrested and charged with burglary, robbery, and capital murder.At trial, White's defense initially focused on an alibi, but this strategy collapsed when one of his accomplices agreed to testify against him in exchange for immunity. White's counsel then pursued an insanity defense, presenting evidence of White's abusive and traumatic childhood. Despite this, the jury found White guilty on all counts and recommended the death penalty, which the trial judge imposed.White appealed his conviction and sentence, but the Kentucky Supreme Court affirmed the decision, and the U.S. Supreme Court denied certiorari. White then sought post-conviction relief, arguing ineffective assistance of counsel for failing to investigate and present mitigating evidence. The Kentucky Supreme Court ultimately rejected this claim, finding that counsel's performance was reasonable and that additional mitigating evidence would not have changed the jury's decision.White filed for federal habeas relief, which was denied by the U.S. District Court for the Eastern District of Kentucky. The court found that counsel's investigation and presentation of mitigating evidence were reasonable and that the Kentucky Supreme Court's application of Strickland v. Washington was not unreasonable. The Sixth Circuit Court of Appeals affirmed this decision, holding that White's counsel's performance was within the wide range of reasonable professional assistance and that there was no substantial likelihood that additional mitigating evidence would have changed the jury's recommendation for the death penalty. View "White v. Plappert" on Justia Law

Duane Gary Underwood, II was convicted of possession with intent to distribute methamphetamine, possession of a stolen firearm, and possession of a firearm in furtherance of a drug trafficking crime. Underwood appealed his conviction on ten grounds, including the constitutionality of 18 U.S.C. § 924(c)(1)(A), the legality of his detention and search, the validity of a search warrant for his phone, the admissibility of certain evidence, voir dire procedures, the sufficiency of the evidence, jury instructions, and the licensure status of the prosecuting Assistant U.S. Attorney (AUSA).The United States District Court for the Western District of Michigan denied Underwood's pretrial motions to suppress evidence and dismiss charges. The court admitted evidence from Underwood's phone and grand jury testimony under Rule 803(5). The jury convicted Underwood on all counts, and he was sentenced to 180 months' imprisonment. Post-trial, Underwood moved to dismiss his conviction, arguing that the AUSA's administrative suspension for nonpayment of bar dues constituted prosecutorial misconduct and a jurisdictional defect. The district court denied this motion.The United States Court of Appeals for the Sixth Circuit reviewed the case and affirmed the district court's judgment. The court held that 18 U.S.C. § 924(c)(1)(A) is constitutional, the officers had reasonable suspicion to detain and search Underwood, and the search warrant for Underwood's phone was valid. The court found no abuse of discretion in admitting the contested evidence or in the voir dire procedures. The evidence was deemed sufficient to support the convictions, and the jury instructions were appropriate. The court also ruled that the AUSA's administrative suspension did not constitute prosecutorial misconduct or create a jurisdictional defect, and there was no Brady violation. View "United States v. Underwood" on Justia Law

Jonathon Neuhard was convicted by a jury of producing, receiving, and possessing child pornography. The evidence included testimony from his niece, MV1, who identified herself in the images and stated that Neuhard had taken them. Law enforcement found the images on a laptop and memory card in Neuhard's trailer, with metadata linking the images to his phone. Neuhard sought to vacate his sentence under 28 U.S.C. § 2255, claiming ineffective assistance of trial and appellate counsel.The United States District Court for the Eastern District of Michigan denied Neuhard's motion but granted a certificate of appealability. Neuhard argued that his trial counsel, Richard Korn, failed to adequately investigate and present evidence of his autism and did not request an evidentiary hearing regarding a government witness's mention of polygraph tests. He also contended that his appellate counsel was ineffective for not appealing the denial of his mistrial motion.The United States Court of Appeals for the Sixth Circuit reviewed the case. The court found that Korn had conducted a reasonable investigation into Neuhard's autism and made a strategic decision not to present this evidence at trial, fearing it would harm Neuhard's case. The court also determined that Neuhard did not suffer prejudice from Korn's failure to request an evidentiary hearing about the polygraph testimony, as the district court had issued a clear and immediate instruction to the jury to disregard the comment.Regarding appellate counsel, the court held that the decision not to appeal the mistrial denial was within the bounds of reasonable professional judgment. The court noted that appellate counsel had raised six other issues on appeal, and the mistrial claim was not clearly stronger than the issues presented.The Sixth Circuit affirmed the district court's denial of Neuhard's § 2255 motion. View "Neuhard v. U.S." on Justia Law