Justia U.S. D.C. Circuit Court of Appeals Opinion Summaries

Articles Posted in Contracts
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The case involves Pablo Abreu, a student who was expelled from Howard University College of Medicine. Abreu appealed his expulsion, arguing that the university violated his rights under Title III of the Americans with Disabilities Act (ADA) and the Rehabilitation Act of 1972 by refusing to grant him additional opportunities to retake a required examination, in light of his diagnosed test-taking-anxiety disability. The district court dismissed his complaint, applying a one-year statute of limitations and ruling that his claims were time-barred.The United States Court of Appeals for the District of Columbia Circuit disagreed with the lower court's application of a one-year statute of limitations to Abreu’s ADA and Rehabilitation Act claims. The court pointed to its decision in another case, Stafford v. George Washington University, in which it concluded that a three-year statute of limitations should apply to civil rights claims under Title VI of the Civil Rights Act of 1964. Since Abreu's ADA and Rehabilitation Act claims were also civil rights claims alleging discrimination, the court ruled that the three-year statute of limitations should apply. This made Abreu’s claims timely since he filed the suit less than three years after his expulsion.The court then remanded the case back to the district court for further proceedings on the ADA and Rehabilitation Act claims. However, it affirmed the dismissal of Abreu's contractual claims, agreeing with the district court that Abreu failed to state a claim for breach of contract. View "Abreu v. Howard University" on Justia Law

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Petitioner Cboe Futures Exchange (CFE) announced plans to list futures contracts based on the Cboe Volatility Index, more commonly known as the “VIX Index.” The following year, the SEC and the CFTC issued a joint order “excluding certain indexes comprised of options on broad-based security indexes”—including the VIX—“from the definition of the term narrow-based security index.” The petition, in this case, challenged the SEC’s 2020 order treating SPIKES futures as futures.   The DC Circuit granted the petition. The court explained that the SEC did not adequately explain why SPIKES futures must be regulated as futures to promote competition with VIX futures. However, the court wrote that while it vacates the Commission’s order, it will withhold issuance of our mandate for three calendar months to allow market participants sufficient time to wind down existing SPIKES futures transactions with offsetting transactions. The court explained that the Exemptive Order never mentions the futures disclosures. And at any rate, those disclosures only partially fill the void left by the absence of the Disclosure Statement. As with the Exemptive Order’s exceptions and conditions, the futures disclosures do not address any number of matters covered by the Disclosure Statement. And even when the two sets of disclosures overlap, the Disclosure Statement tends to provide much greater detail than the futures disclosures. View "Cboe Futures Exchange, LLC v. SEC" on Justia Law

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Norfolk Southern Railway Company (Norfolk Southern) petitioned for review of a decision of the Surface Transportation Board (STB or Board), the successor agency to the Interstate Commerce Commission (ICC) charged with authorizing certain rail carrier transactions under the Interstate Commerce Act. Norfolk Southern is a rail carrier that owns a 57.14 percent share of the Norfolk & Portsmouth Belt Line Railroad Company (Belt Line), the operator of a major switching terminal in Norfolk, Virginia. Norfolk Southern’s majority interest goes back to 1982, when its corporate family acquired and consolidated various rail carriers with smaller ownership interests in the Belt Line. Norfolk Southern’s competitor, CSX Transportation, Inc. (CSX), owns the remainder of the Belt Line’s shares (42.86 percent). This case involves a different question raised before the Board for the first time:  whether the ICC/Board approvals of Norfolk Southern’s subsequent corporate-family consolidations in 1991 and 1998 authorized Norfolk Southern to control the Belt Line. The Board again answered no. Norfolk Southern petitioned for review.   The DC Circuit affirmed. The court concluded that the Board’s decision regarding the 1991 and 1998 transactions is neither arbitrary nor capricious. The Board reasonably sought to avoid an absurd interpretation of 49 C.F.R. Section 1180.2(d)(3)’s corporate-family exemption that would allow a carrier to gain control of a new entity without following the Board’s review requirements and then “cure that unauthorized acquisition by reorganizing the corporate family.” The Board reasonably rejected Norfolk Southern’s claim that, by reshuffling the pieces of its corporate family, it acquired control authority of the Belt Line sub silentio. View "Norfolk Southern Railway Company v. STB" on Justia Law

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Plaintiff is the former Vice President of Program and Community of the Eugene and Agnes E. Meyer Foundation. She received largely positive feedback during her tenure, but less than two years after she was hired, the CEO of the Foundation fired her for purported interpersonal and communication-related issues. Plaintiff, who is African-American, believes these stated reasons were pretext to mask discriminatory animus. Plaintiff and the Foundation signed a severance agreement, under which Plaintiff agreed to release employment-related claims against the Foundation and its employees, and which contained a mutual non-disparagement clause. But roughly a month after Plaintiff was fired, the CEO told another leader in the non-profit space that Plaintiff was let go because she was “toxic,” created a “negative environment.” Plaintiff sued the Foundation and its CEO for breaching the severance agreement, for doing so in a racially discriminatory manner in violation of 42 U.S.C. Section 1981, and for defaming her. The district court dismissed all three claims.   The DC Circuit held that the district court erred in dismissing all three claims. As to Plaintiff’s breach of contract claim, the non-disparagement clause could reasonably be interpreted to preclude the Foundation from disparaging Plaintiff, and dismissal under Federal Rule of Civil Procedure 12(b)(6) is therefore inappropriate. As to her Section 1981 claim, the court found that she has plausibly alleged a prima facie case that the Foundation, through the CEO, breached the severance agreement due to racial animus. And lastly, the CEO’s statements are not protected by the common interest privilege, which requires a showing of good faith on the part of the speaker. View "Terri Wright v. Eugene & Agnes E. Meyer Foundation" on Justia Law

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The Office of Personnel Management (OPM) administers retirement benefits for civilian employees of the U.S. government. OPM typically pays retirement benefits to retirees themselves. But when a retiree’s benefits are subject to division pursuant to a divorce decree, OPM divides them between the retiree and his or her former spouse according to the terms of the decree. The Federal Law Enforcement Officers Association (Association) brought this action against OPM in district court, claiming that OPM’s method of apportioning one type of retirement benefit, the Annuity Supplement, violates the Administrative Procedure Act. OPM moved to dismiss the complaint on jurisdictional grounds.   The district court acknowledged that federal employees’ claims for retirement benefits are generally routed through that system of review, but held that the Association’s claims fell within an exception allowing pre-enforcement challenges to agency rules to proceed in district court. Exercising jurisdiction, the district court dismissed one of the Association’s counts for failure to state a legally cognizable claim and, after the administrative record was filed, granted summary judgment to OPM as to the others.   The DC Circuit vacated the district court’s orders and remanded with instructions to dismiss for lack of jurisdiction. The court held that the CSRA’s system of review—which channels disputes about FERS retirement benefits through an administrative process, subject to direct review in the Federal Circuit—precludes district court review of the Association’s claims. View "Federal Law Enforcement Officers Association v. Kiran Ahuja" on Justia Law

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Plaintiff asked the Foreign Service Grievance Board to review the Foreign Service’s decision to deny her tenure. While the Board was considering her grievances, Plaintiff asked the Board to grant “interim relief.” That relief would have let Plaintiff keep working for the Foreign Service until her case was decided. But the Board refused to grant it. So Plaintiff filed suit, claiming that the Board should have given her relief. After Plainitff in lost in the district court and appealed to this court, the Board reached final decisions on her grievances. 
 The DC Circuit affirmed the district court’s decision to dismiss Plaintiff’s backpay claim, and the court dismissed Plaintiff’s appeal of her interim-relief claims as moot. The court explained backpay is not an available remedy on judicial review of the Board’s orders. Nothing in the Foreign Service Act authorizes a court to issue backpay. Plus, under the Act, judicial review is adjudicated “in accordance with the standards set forth in [the Administrative Procedure Act].” Here, the Board found no merit to four of Plaintiff’s grievances. As for the fifth grievance, the Board held that Plaintiff’s claim had merit, but it still denied her backpay. And because Plaintiff has not petitioned for judicial review of the Board’s decision to deny backpay in that grievance, the court wrote it cannot direct the Board to reconsider it. View "Julie Beberman v. Antony Blinken" on Justia Law

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Before the parties arrived at the 2016 labor agreement at issue, the Company’s benefit plan offered bargaining-unit employees a tax-advantaged defined contribution plan under Internal Revenue Code Section 401(k)—a “401(k)” for short. When the Company upgraded its retirement-benefit offering in 2018, the Union brought the unfair labor practice charge at issue here. The Union claimed that the Company unilaterally modified the parties’ collective bargaining agreement by “implementing a 401(k) contribution matching structure other than that specifically negotiated and memorialized in the CBA [Collective Bargaining Agreement].” The parties dispute which of the two documents—with different 401(k) terms—reflects their final and binding agreement   The Company asserted, and the National Labor Relations Board (the Board) determined that the binding agreement is September 16, 2016, Memorandum of Agreement, as a hand signed by Company and Union bargaining representatives. The Union asserts that a different contract document, as typed up and circulated to the parties almost a year later, is the one that binds. 
The DC Circuit denied the Union’s petition for review. The court held that here the parol evidence of the parties' bargaining history allowed the Board to identify the Memorandum of Agreement as the final product of the parties’ negotiations and to conclude that the 401(k) term in the 2017 revised version of the Collective Bargaining Agreement contained an unenforceable unilateral mistake. View "District 4, Communications Workers of America (CWA), AFL-CIO v. NLRB" on Justia Law

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The surety (“Colonial”) for the prime contractor (“Hirani”) challenged the district court’s award of quantum meruit damages on the Miller Act claim of the subcontractor (“ACC”), and the district court’s award as double recovery for the subcontractor. The subcontractor continues to challenge the district court’s denial of recovery under the Miller Act for the reasonable value of its superintendent’s services at the job site.   The DC Circuit affirmed the district court’s judgment except to remand for the district court to expressly address whether there would be impermissible double recovery for the subcontractor. The court wrote that even if D.C. contract law caps the subcontractor’s restitution recovery against the prime contractor to expectation damages and does not permit recovery in quantum meruit where there is an express contract, no such limit applies to the claim against the surety under the Miller Act. Second, the court explained it need not resolve the surety’s contention that the district court awarded the subcontractor double recovery. Further, given that the construction work at issue had to be supervised and inspected for conformance with the subcontract and other requirements, such as government quality control standards, the superintendent’s on-site supervisory work constitutes “labor” within the meaning of the Miller Act. View "USA v. Hirani Engineering & Land" on Justia Law

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The United States Court of Appeals for the District of Columbia Circuit reversed the judgment of the district court declining to reach the merits of Plaintiffs' complaint challenging a determination of the Federal Deposit Insurance Corporation (FDIC) as unlawful under the Administrative Procedure Act (APA), 5 U.S.C. 706(2), holding that the district court erred in concluding that the FDIC exceeded its authority in making the determination.Plaintiffs, two bank executives, were fired after a proposed merger because they refused to accept a reduction in the amount of a payment that was contractually provided for them. Plaintiffs sued the bank that terminated them and the bank with which it merged, alleging that they were entitled to the full payments. The banks, in turn, sought guidance from the FDIC as to whether the relief sought by Plaintiffs would constitute a statutorily-restricted "golden parachute" payment. The FDIC responded that the payment would constitute a golden parachute. Plaintiffs then brought this action challenging the FDIC's determination as unlawful under the APA. The district court declined to reach the merits, concluding that the FDIC lacked authority to render a golden parachute determination at all. The Court of Appeals reversed and remanded the case, holding that the district court erred in concluding that the FDIC lacked authority to render its golden parachute determination. View "Bauer v. Federal Deposit Insurance Corp." on Justia Law

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In this insurance coverage dispute, Plaintiff, an insured company, sought to sidestep its insurer by collecting a $22 million claim from ten insurance brokers and reinsurers. The district court dismissed Plaintiff’s claims for breach of contract and declaratory judgment.   The D.C. Circuit affirmed the district court’s dismissal. The court held that Plaintiff failed to plead facts to establish a contractual relationship with reinsurers. Plaintiff’s evidence of the reinsurance binders did not create a contractual relationship between Plaintiff and reinsurers. Further, the court held that summary judgment for reinsurers was proper; finding that Plaintiff’s claims of implied contract, promissory estoppel, and unjust enrichment are wholly unsupported by record evidence. The court further held that the “economic loss doctrine” bars Plaintiff’s claims against the other defendants. The economic loss doctrine prohibits claims of negligence where, as here, a claimant seeks to recover purely economic losses. View "Vantage Commodities Financial Services v. Assured Risk Transfer PCC" on Justia Law