Justia Civil Rights Opinion SummariesArticles Posted in Business Law
Thurston v. Omni Hotels Management Corporation
Plaintiff-appellant Cheryl Thurston was blind and used screen reader software to access the Internet and read website content. Defendant-respondent Omni Hotels Management Corporation (Omni) operated hotels and resorts. In November 2016, Thurston initiated this action against Omni, alleging that its website was not fully accessible by the blind and the visually impaired, in violation of the Unruh Civil Rights Act. By way of a special verdict, the jury rejected Thurston’s claim and found that she never intended to make a hotel reservation or ascertain Omni’s prices and accommodations for the purpose of making a hotel reservation. On appeal, Thurston contended the trial court erred as a matter of law: (1) by instructing the jury that her claim required a finding that she intended to make a hotel reservation; and (2) by including the word “purpose” in the special verdict form, which caused the jury to make a “factual finding as to [her] motivation for using or attempting to use [Omni’s] Website.” Finding no reversible error, the Court of Appeal affirmed the trial court. View "Thurston v. Omni Hotels Management Corporation" on Justia Law
Vitolo v. Guzman
The American Rescue Plan Act of 2021 allocated $29 billion for grants to help restaurant owners. The Small Business Administration (SBA) processed applications and distributed funds on a first-come, first-served basis. During the first 21 days, it gave grants only to priority applicants--restaurants at least 51% owned and controlled by women, veterans, or the “socially and economically disadvantaged,” defined by reference to the Small Business Act, which refers to those who have been “subjected to racial or ethnic prejudice” or “cultural bias” based solely on immutable characteristics, 15 U.S.C. 637(a)(5). A person is considered “economically disadvantaged” if he is socially disadvantaged and he faces “diminished capital and credit opportunities” compared to non-socially disadvantaged people who operate in the same industry. Under a pre-pandemic regulation, the SBA presumes certain applicants are socially disadvantaged including: “Black Americans,” “Hispanic Americans,” “Asian Pacific Americans,” “Native Americans,” and “Subcontinent Asian Americans.” After reviewing evidence, the SBA will consider an applicant a victim of “individual social disadvantage” based on specific findings.Vitolo (white) and his wife (Hispanic) own a restaurant and submitted an application. Vitolo sued, seeking a preliminary injunction to prohibit the government from disbursing grants based on race or sex. The Sixth Circuit ordered the government to fund the plaintiffs’ application, if approved, before all later-filed applications, without regard to processing time or the applicants’ race or sex. The government failed to provide an exceedingly persuasive justification that would allow the classification to stand. The government may continue the preference for veteran-owned restaurants. View "Vitolo v. Guzman" on Justia Law
Electra v. 59 Murray Enterprises, Inc.
Plaintiffs filed suit alleging that defendants unlawfully used photographs of them to advertise strip clubs owned by defendants in violation of New York Civil Rights Law sections 50 and 51. The district court granted summary judgment for defendants, holding that plaintiffs signed full releases of their rights to the photographs.The Second Circuit concluded that the terms of Plaintiff Shake and Hinton's release agreements are disputed material facts, and defendants concede that neither they nor the third-party contractors that created and published the advertisements secured legal rights to use any of the photographs at issue. The court held that the district court erred in granting summary judgment to defendants and in denying summary judgment to plaintiffs on liability. Therefore, the court vacated in part and remanded for further proceedings.The court affirmed in part and held that the district court correctly concluded that plaintiffs had not accepted the offer of judgment because the offer's settlement amount term was ambiguous, the parties disagreed over how to interpret the term, and there was accordingly no meeting of the minds. Finally, the court held that the district court correctly dismissed the Lanham Act, 15 U.S.C. 1125(a), New York General Business Law Section 349, and libel claims. View "Electra v. 59 Murray Enterprises, Inc." on Justia Law
Ariix, LLC v. NutriSearch Corp.
The Ninth Circuit reversed the district court's dismissal of a false advertising claim under the Lanham Act, remanding for further proceedings. At issue is whether the First Amendment shields a publisher of supposedly independent product reviews if it has secretly rigged the ratings to favor one company in exchange for compensation. The panel ruled that this speech qualifies as commercial speech only, and that a nonfavored company may potentially sue the publisher for misrepresentation under the Lanham Act.In this case, Ariix alleges that NutriSearch rigged its ratings to favor Usana under a hidden financial arrangement. The panel held that Ariix plausibly alleges that the nutritional supplement guide is commercial speech, is sufficiently disseminated, and contains actionable statements of fact. However, the panel remanded for the district court to consider the "purpose of influencing" element under the Lanham Act. View "Ariix, LLC v. NutriSearch Corp." on Justia Law
Department of Human Rights v. Oakridge Healthcare Center, LLC
In 2014, a $30,880 judgment covering backpay and pre-judgment interest was entered against Oakridge Nursing & Rehabilitation Center, LLC, for its age and disability discrimination against a former employee, in violation of the Illinois Human Rights Act, 775 ILCS 5/1-101. Oakridge Rehab had already gone out of business and transferred the assets and operation of its nursing home facility to Oakridge Healthcare Center, LLC in 2012. Unable to enforce the judgment against Oakridge Rehab, the state instituted proceedings to enforce the judgment against Oakridge Healthcare.The Illinois Supreme Court ruled in favor of Oakridge Healthcare, declining to adopt the federal successor liability doctrine in cases arising under the Human Rights Act. The court noted four limited exceptions to the general rule of nonliability for corporate successors and declined to apply the fraudulent purpose exception, which exists “where the transaction is for the fraudulent purpose of escaping liability for the seller’s obligations.” The court stated that it is within the legislature’s power to abrogate the common-law rule of successor nonliability or otherwise alter its standards through appropriately targeted legislation for employment discrimination cases. View "Department of Human Rights v. Oakridge Healthcare Center, LLC" on Justia Law
Thurston v. Fairfield Collectibles of Georgia, LLC
Plaintiffs Cheryl Thurston and Luis Licea (collectively Thurston) were California residents who purchased items from defendant Fairfield Collectibles of Georgia, LLC (Fairfield), a Georgia limited liability company, through the company's website. Thurston alleged Fairfield’s website was not fully accessible by the blind and the visually impaired, in violation of the Unruh Civil Rights Act. The trial court granted Fairfield’s motion to quash service of summons, ruling that California could not obtain personal jurisdiction over Fairfield, because Fairfield did not have sufficient minimum contacts with California. The Court of Appeal reversed, finding the evidence showed that Fairfield made some eight to ten percent of its sales to Californians. "Hence, its website is the equivalent of a physical store in California. Moreover, this case arises out of the operation of that website." The trial court therefore could properly exercise personal jurisdiction over Fairfield. View "Thurston v. Fairfield Collectibles of Georgia, LLC" on Justia Law
Sherwin Williams Co. v. County of Delaware
Two counties sued Sherwin-Williams in state court, seeking abatement of the public nuisance caused by lead-based paint. Anticipating suits by other counties, Sherwin-Williams sued in federal court under 42 U.S.C. 1983. Sherwin-Williams claimed that “[i]t is likely that the fee agreement between [Delaware County] and the outside trial lawyers [is] or will be substantively similar to an agreement struck by the same attorneys and Lehigh County to pursue what appears to be identical litigation” and that “the Count[y] ha[s] effectively and impermissibly delegated [its] exercise of police power to the private trial attorneys” by vesting the prosecutorial function in someone who has a financial interest in using the government’s police power to hold a defendant liable. The complaint pleaded a First Amendment violation, citing the company’s membership in trade associations, Sherwin-Williams’ purported petitioning of federal, state, and local governments, and its commercial speech. The complaint also argued that the public nuisance theory would seek to impose liability “that is grossly disproportionate,” arbitrary, retroactive, vague, and “after an unexplainable, prejudicial, and extraordinarily long delay, in violation of the Due Process Clause.”The Third Circuit affirmed the dismissal of the suit. Sherwin-Williams failed to plead an injury in fact or a ripe case or controversy because the alleged harms hinged on the County actually filing suit. View "Sherwin Williams Co. v. County of Delaware" on Justia Law
Colucci v. T-Mobile USA, Inc.
T-Mobile USA, Inc. (T-Mobile) appeals a judgment entered on a $5 million jury verdict in favor of former employee Stephen Colucci in a workplace retaliation case. T-Mobile primarily challenged the punitive damages award, arguing insufficient evidence was presented at trial that a T-Mobile agent engaged in retaliatory conduct, or that the agent's actions were malicious or oppressive. Alternatively, T-Mobile argued the $4 million punitive damages award was constitutionally excessive. Stephen Colucci worked for T-Mobile from 2007 until 2014 as the manager of a store in Ontario, California. A series of incidents ranging from a medical accommodation request, defamatory comments made by co-workers, and an allegation that Colucci was running a side business while on duty for his T-Mobile store. On day, complaining of back pain, Colucci was permitted to leave work for the day; while away, Robson recommended to HR that T-Mobile terminate Colucci for "cause" (conflict of interest), notwithstanding no loss prevention investigator interviewed Colucci or any co-workers about Colucci's alleged side-dealings while on T-Mobile time. In making this decision, Robson admittedly bypassed T-Mobile's progressive discipline policy, which might have included a warning or less severe consequence before resorting to termination. Information about the alleged conflict of interest had come almost entirely from the associate; at no point did anyone speak to Colucci about a purported conflict. Unaware of any pending termination, Colucci submitted a formal request to HR for a medical leave of absence. Colucci also lodged a second complaint to T-Mobile's integrity line, reporting that Robson was discriminating against him and neglecting to resolve the defamation incident. Undeterred, Robson proceeded with processing Colucci's termination. Ultimately, a jury returned a unanimous verdict in Colucci's favor on his claim of retaliation, awarding $1,020,042 in total compensatory damages for past and future economic losses, and past and future noneconomic damages and/or emotional distress. After review, the Court of Appeal reduced the punitive damages award to an amount one and one-half times the amount of compensatory damages, but otherwise affirmed the judgment. View "Colucci v. T-Mobile USA, Inc." on Justia Law
Beem USA Limited-Liability Limited Partnership v. Grax Consulting LLC
In this business case, the Supreme Court reversed the orders of the business court denying Plaintiffs' motion for default judgment based on its finding that Plaintiffs had failed to satisfy their burden of proving that the court possessed personal jurisdiction over Defendant, a nonresident company, holding that Defendant's contacts with North Carolina were sufficient to permit the exercise of personal jurisdiction over it in North Carolina state courts.In the complaint, Plaintiffs sought an injunction, in part, directing Defendant to turn over certain documents and information necessary for Plaintiffs to wind up the affairs of a limited-liability limited partnership. A default was entered against Defendant, but the business court denied Plaintiffs' motion for default judgment. The Supreme Court reversed, holding that Defendant had sufficient minimum contacts with this state such that a North Carolina court could constitutionally exercise personal jurisdiction over it. View "Beem USA Limited-Liability Limited Partnership v. Grax Consulting LLC" on Justia Law
Johnson v. Morales
Johnson rented her restaurant to a private party. For unknown reasons, individuals unaffiliated with her or the party emerged from a vehicle that night and shot at the restaurant. Police were called during the shooting but never apprehended the shooters. Less than two days later, Saginaw City Manager Morales issued Johnson a notice ordering the suspension of all business activity related to her restaurant under an ordinance that permits such suspensions “in the interest of the public health, morals, safety, or welfare[.]” There was hearing three days later. More than two months after the hearing, Human Resources Director Jordan upheld the suspension. Johnson filed suit with a motion for a temporary restraining order and, alternatively, a motion for a preliminary injunction to prevent Morales from sitting on the appeal panel expected to review Jordan’s decision. The district court denied that motion. The appeal panel, which did not include Morales, held a hearing and affirmed Jordan’s decision upholding the suspension. The Sixth Circuit reversed, in part, the dismissal of Johnson’s burden-shifting, substantive due process, and equal-protection claims. Johnson adequately alleged selective enforcement and pled that the city lacked a rational basis to suspend her license. Johnson has plausibly alleged that the procedures afforded to Johnson fell short of constitutional requirements. View "Johnson v. Morales" on Justia Law