Seventh Circuit Review

The Class Action Fairness Act ("CAFA") expands removal jurisdiction to include most state court class action suits that "commenced" before CAFA's enactment. The question facing many courts now is what constitutes a suit's commencement? The Seventh Circuit recently determined that the addition of new defendants or new claims that do not relate back to the original cause of action, "commence" a new suit for purposes of removal jurisdiction under CAFA. This article examines the Seventh Circuit's interpretation and concludes that it will likely upset the settled expectations of plaintiffs who filed their cases in state court expecting to go to judgment there, although this broad interpretation is consistent with CAFA's underlying purpose. [Hide Abstract]

How great is the divide between federal and state courts when state law mirrors federal law? Can federal courts improve judicial efficiency by extending the statute of limitations for federal antitrust claims based on concurrent state antitrust class actions? The Seventh Circuit's recent attempt at docket control in In re Copper Antitrust Litigation refused to accept this counter intuitive approach. This article addresses the effect of the Seventh Circuit's decision, which actually decreased judicial efficiency by encouraging state antitrust class action members to file duplicative claims in federal court despite identical state and federal antitrust statutory schemes. [Hide Abstract]

Inmates confined to correctional facilities have necessarily forfeited many of their civil rights. But what happens when the institution that houses them restricts one of their few remaining rights? The answer for many inmates was to sue in federal court alleging violations under 42 USC § 1983. In an attempt to limit the number of inmate suits heard by an already over-burdened federal judiciary, Congress enacted the Prisoner's Litigation Reform Act ("PLRA") in 1996. The PLRA requires that inmates exhaust the administrative remedies available to them as a prerequisite to filing suit in federal court. The effects of the PLRA exhaustion requirement was to immediately and drastically constrain the civil rights of inmates by limiting access to federal courts. This article analyzes the Seventh Circuit's attempt to protect the rights of inmates and balance the interests of correctional officials against the protections of the Constitution. [Hide Abstract]

The United States Supreme Court previously ruled that recording television programs or movies using Betamax or VHS tapes does not constitute copyright infringement. However, the Supreme Court recently held that downloading music from a peer-to-peer (P2P) file-sharing network does constitute copyright infringement. Thus, federal district court decisions are now targeting individuals who illegally download music from these networks and entering large monetary judgments against them. The U.S. Court of Appeals for the Seventh Circuit is upholding these judgments. This article discusses the difference between video taping and downloading and why is there a discrepancy in terms of copyright law. [Hide Abstract]

In Crawford v. Washington, the Supreme Court overturned years of precedent holding that any hearsay statement that is deemed "testimonial" cannot be admitted into evidence unless the defendant has the opportunity to confront and cross-examine the declarant. Because the Court did not define testimonial, trial and appellate courts have been required to do so. Many Courts of Appeals have held that a statement is testimonial if a reasonable declarant would believe the statement would be used in court. However, in United States v. Gilbertson the Seventh Circuit abandoned the Supreme Court's reasoning in Crawford v. Washington when it held that only communications initiated by the government qualify as testimonial. This article concludes that the Seventh Circuit improperly narrowed the definition of testimonial by holding that the government must initiate the communication. [Hide Abstract]

Under the Equal Pay Act, an employer may avoid liability by proving the affirmative defense that a wage disparity is based "on any factor other than sex." Where an employee's starting salary is based on their prior salary, will this satisfy the "factor other than sex" defense? The Seventh Circuit recently approached this issue in Wernsing v. Dep't of Human Services. Unlike other circuits that require an employer to show a legitimate business reason for using prior salaries to set wages and satisfy the "factor other than sex" defense, this article discusses the Seventh Circuit's conclusion that prior salary standing alone satisfies this defense. The article concludes that this holding perpetuates sex discrimination contrary to the purposes of the Equal Pay Act. [Hide Abstract]

The Supreme Court's decision in Firestone v. Bruch required that conflicts of interest by a plan administrator be "weighed as a factor in determining whether there is an abuse of discretion" in the decision to deny benefits. Nearly every circuit court of appeals, except the Seventh Circuit, has determined that where the plan administrator is also the funder or insurer of a plan, there is an inherent conflict of interest that warrants adjusting the standard of review. This article discusses the Seventh Circuit's reasons for departing from the wisdom of the other circuit courts, and why its reasons are unjustifiable. [Hide Abstract]

Can officials at public colleges and universities in the Seventh Circuit censor student speech? How free is the college free press? In Hazelwood School District v. Kuhlmeier, the U.S. Supreme Court permitted high school administrators to censor school-sponsored speech if their actions were supported by "legitimate pedagogical concerns." However, the high court specifically stated that it was not deciding whether the same degree of deference is appropriate with respect to speech in higher education. Thus, this article argues that the Seventh Circuit's application of the Hazelwood standard to assess a student newspaper censorship claim at a Illinois public university is an unwarranted extension of the Supreme Court's high school-specific holding and has sweeping implications on First Amendment jurisprudence. [Hide Abstract]

The adjudication of asylum applications is of vital importance to refugees seeking safe haven within the United States and is often a matter of life or death. However, in its current term, the Seventh Circuit reversed the asylum decisions of immigration judges and the Board of Immigration Appeals in approximately two-thirds of its published opinions. Many of these reversals can be traced to unsupported subjective assessments performed by immigration judges. Blame may also lie with the Board of Immigration Appeals, the Department of Justice, and the Department of Homeland Security. Although the Seventh Circuit identified several noticeable and repetitive problems, it is left with few options other than reversal. Congress, on the other hand, recently expanded the scope of subjective immigration judge decisions that can act as the solitary basis for asylum denials. This article examines whether this legislation may compound the problems identified by the Seventh Circuit. [Hide Abstract]

Should manufacturers of cutting-edge medical devices ever be able to avoid liability from common law tort claims? Recently, the Seventh Circuit held that tort claims against these manufacturers are preempted when the manufacturer has received pre-market approval from the Food and Drug Administration. This article discusses whether this position adequately balances the competing concerns of developing technologically advanced medical devices with protecting the consumers of such devices. [Hide Abstract]

The Securities Litigation Reform Act ("SLUSA") grants exclusive federal jurisdiction to securities actions where plaintiffs have purchased or sold securities. Similarly, the Supreme Court case, Blue Chip Stamps v. Manor Drug Stores, requires that only purchasers and sellers of securities may bring private securities actions under federal securities law. This article discusses the cases of Kircher v. Putnam Funds Trust and Putnam Investment Management, LLC, et al., where the Seventh Circuit held that the purchaser-seller rule announced in Blue Chip Stamps did not affect SLUSA's coverage and that therefore a claim brought by a plaintiff class comprised entirely of non-traders would still be preempted by SLUSA. Because a plaintiff class that neither bought nor sold stock during the class period could not bring a claim in state court, it would be compelled to either file a derivative action or commit the case to public prosecutors. [Hide Abstract]

What is the substantive standard of scienter under the PSLRA? What must be pled to adequately allege a "strong inference" of scienter? The circuit courts of appeal debate both of these issues, resulting in different pleading standards across the nation. The Seventh Circuit case of Makor Issues & Rights v. Tellabs, Inc. concluded that the substantive standard of scienter remains "recklessness" despite the PSLRA's enactment, and that a showing of "motive and opportunity" to defraud can suffice to create the requisite "strong inference" of scienter in some cases, but not in others. In light of the unclear legislative history of the PSLRA, this article analyzes whether the Seventh Circuit properly allows the "motive and opportunity" test to create a "strong inference" of scienter without establishing a hard-and-fast rule that a showing of "motive and opportunity" are always or never sufficient. [Hide Abstract]

An administrative law judge's decision to deny a claim for Social Security Disability Insurance benefits must be supported by substantial evidence. In practice, the application of this standard has varied as the Seventh Circuit has struggled over the degree of deference that should be accorded to the administrative law judge's findings. This article examines the Seventh Circuit's most recent attempts to advance a standard in terms of the broad objectives of the Social Security Disability Insurance program and a renewed emphasis on the investigatory role of the administrative law judge. [Hide Abstract]