Seventh Circuit Review
Volume 11, Issue 2 (Spring 2016)
Introduction (contains Table of Contents, Masthead, About the Seventh Circuit Review and Preface)
Abstract: As the wage-market remains stagnant, and student indebtedness continues to rise, many graduates struggle to balance their student loan debt. Generally, when a debtor files for bankruptcy, her student loan debt is not dischargeable. However, under 11 U.S.C. § 523(a)(8), debtors can discharge their student loans through bankruptcy if they can prove that maintaining those student loan debts would impose an "undue hardship" upon themselves. Unfortunately, Congress did not define what "undue hardship" meant when enacting the bankruptcy code. Courts have since been left to interpret the definition of "undue hardship," and many do so in different ways. [Read more...]
Across the various circuits, “undue hardship” is evaluated similarly—but the differences in definitions can sometimes be outcome determinative. While rare, a jurisdiction employing a “totality-of-the-circumstances” approach to undue hardship may discharge a debtor’s student loans when a different jurisdiction employing a more rigid test would not. This is a problem because the United States Constitution requires uniform federal bankruptcy laws to be applied throughout the states. This Comment calls for the legislature to further define undue hardship to avoid the rare circumstances when debtors are treated dissimilarly solely because of what court they appear in.
Since there has been no further definition of “undue hardship,” it is important to understand how the student loan discharge process works within the states of Illinois, Indiana, and Wisconsin. The Seventh Circuit, after the recent holding in Tetzlaff v. Educational Credit Management Corp., now has one of the strictest tests for evaluating undue hardship. The unanimous Tetzlaff opinion reiterated that the Seventh Circuit employs a three-pronged test to determine whether undue hardship exists. The debtor must show that: (1) he cannot currently maintain a “minimal” standard of living for himself and his dependents if forced to repay the loans; (2) additional circumstances show that this state of affairs is likely to persist for a significant portion of the repayment period; and (3) he made a good faith effort to repay the loans in question. The Seventh Circuit clarified that the dischargeability of loans should be based on a certainty of hopelessness standard, not a present inability to fulfill a financial commitment. In light of that rationale, the second prong of the undue hardship analysis requires a debtor to show his “certainty of hopelessness.” Further, the Seventh Circuit held that the third prong of the analysis—the good faith requirement—requires payment on the specific loans the debtor is attempting to discharge. Paying private student loans in lieu of paying federal loans does not allow debtors to discharge those federal loans. Ultimately, this Comment argues that this strict application of the “undue hardship” definition is more exacting than the language of “undue hardship” itself, and that the Seventh Circuit should reconsider its rigid application of the undue hardship analysis.[Condense Abstract]
Abstract: Data breaches are becoming a more frequent and more troubling part of modern life. When customer or employee information is stolen en masse, lawsuits often follow. Courts have frequently dismissed such cases very early for want of Article III standing. For purposes of standing, courts are faced with the question of whether or not the fact of a breach is sufficient for plaintiffs to bring lawsuits against the credit card companies, employers, or stores that, as victims of a cyberattack, have compromised the information of hundreds or thousands. But the real victims are those whose personal information has been stolen. Therefore, the essential question is whether or not their harm is sufficient to allege the injury element of Article III standing. [Read more...]
The Seventh Circuit addressed this matter in Remijas v. Neiman Marcus, LLC, in which Neiman Marcus shoppers brought suit against the luxury store following a data breach that compromised the information of 350,000 shoppers, 9,200 of whom suffered fraudulent charges on their credit cards. At the trial level, the United States District Court for the Northern District of Illinois held, inter alia, that the fraudulent charges were not enough to prove injury sufficient to confer standing because the charges were reimbursed, rendering the alleged injury insufficiently “concrete.” The district court also found that the remaining shoppers who did not suffer fraudulent charges also suffered no injury-in-fact. The Seventh Circuit reversed, holding that the District Court had improperly applied the Supreme Court’s holding in Clapper v. Amnesty International USA. The Seventh Circuit held that Clapper did not foreclose the use of future injuries. On the contrary, standing was held to be appropriate where there was a substantial risk of future harm to all plaintiffs whose information was stolen. This Comment first discusses the history of Article III standing, with a focus on data breaches, followed by a discussion of the Seventh Circuit’s decision in Remijas. Finally, this Comment argues that Remijas was correctly decided and was properly distinguished from Clapper.[Condense Abstract]
Abstract: This nation is currently engaged in vigorous discussion about how to address brutality and targeting of minorities committed by law enforcement. In some cases, even where liability is admitted as to racially targeted policing, a court may significantly reduce the amount of damages awarded by a jury to victims of police brutality through use of a procedure call “remittitur.” Remittitur occurs when a trial judge determines that a jury award is excessive, and offers the plaintiff the option of accepting a reduction in the jury verdict or proceeding to a new trial. Although the Seventh Amendment provides that “no fact tried by a jury, shall be otherwise reexamined in any court of the United States,” courts have insisted that remittitur results only where a jury verdict is excessive as a matter of law. [Read more...]
The Supreme Court of the United States has never directly addressed the question of whether remittitur violates the Seventh Amendment. However, dicta found in the 1935 case Dimick v. Scheidt, combined with longterm practice of remittitur in federal courts, has allowed the procedure to occur largely without question. Such acceptance is not based on constitutional precedent or good public policy. Recent scholarship suggests that the trial option presented to a plaintiff as an alternative to reduced damages is illusory due to the increased cost, delay, and risk of losing a new trial. Further, damages awarded by a jury to compensate for pain and suffering or emotional distress involve a subjective determination of fact. Here, a judge has little basis for supplanting the jury’s determination with a subjective conclusion about damages of his or her own.
Recently, the Seventh Circuit addressed the use of remittitur in Adams v. City of Chicago. There, two brothers appealed a remittitur order that reduced damages awarded to them for claims brought under the Fourth Amendment, the Fourteenth Amendment, and malicious prosecution in violation of Illinois state law. Although the Seventh Circuit reversed the order of remittitur in that case, its dismissal of the plaintiff’s argument that the order of remittitur violated their rights under the Seventh Amendment failed to issue a decision that would prevent similar harm to future victims of police brutality. This Article considers the application and ramifications of remittitur in a civil rights context. Through an analysis of the trial option and the process by which a judge determines that a jury award is excessive in civil rights cases, this Article argues that the practice of remittitur serves no constitutional or public policy interest when a plaintiff sues for violation of his or her civil rights.[Condense Abstract]
Class Action Law
Abstract: The class action is often the only way for victims of consumer fraud to pursue a remedy. Several federal circuit courts have recently adopted the heightened ascertainability requirement—a requirement that makes certifying a consumer class almost impossible. A plaintiff can only meet the heightened ascertainability requirement by showing that members of her proposed class can be identified in a reliable and administratively feasible way. This typically requires documentary proof of class membership. For classes made up of purchasers of deceptive low-cost products who have not kept their receipts, heightened ascertainability has served as an insurmountable barrier to certification. [Read more...]
In Mullins v. Direct Digital LLC, the Seventh Circuit rejected the adoption of the heighted ascertainability requirement. The court held that nothing in Rule 23 mentioned or implied the requirement, and that Rule 23 and the court’s settled class certification analysis already adequately addressed the policy concerns motivating its adoption. In so holding, the court recognized the negative implications that heightened ascertainability would have on the consumer class action.
The Seventh Circuit got it right in rejecting heightened ascertainability. This rule should be abandoned because it undercuts the core policy behind the class action: the vindication of the rights of a group of people who individually would be without effective strength to bring a corporate defendant to court at all. The Judicial Conference’s Committee on Rules of Practice and Procedure should amend Rule 23 to codify the Seventh Circuit’s approach to class certification outlined in Mullins. Such an amendment would eliminate judicially created hurdles to class certification and preserve the class action as an instrument for consumer protection and deterrent against corporate wrongdoing.
Deference to the Lower Court: How the Seventh Circuit Improperly Granted Habeas Corpus Relief in Jensen v. Clements
David J. Welch
11 Seventh Circuit Rev. 231 (2016) [Full Article]
Abstract: As Justice Blackstone once opined, a writ of habeas corpus, oft referred to as the “great Writ,” is “another Magna Carta” established to safeguard people imprisoned in violation of the law. Codified under 28 U.S.C. § 2254, the writ compels a judicial body to review the legality of a state prisoner’s conviction. A granted writ of habeas corpus may require the court to set aside or vacate the conviction or detention. If a petitioner’s case has already been adjudicated on the merits in state court, then the writ cannot be granted. However, if the petitioner can show that either the state court proceeding resulted in a decision that was contrary to, or the state court unreasonably applied, clearly established federal law, or the state court’s decision was based on an unreasonable determination of the facts in light of the evidence presented at trial, then the petitioner’s habeas relief must be issued. [Read more...]
In Jensen v. Clements, the United States Court of Appeals for the Seventh Circuit reviewed the Wisconsin Appellate Court’s decision in the Petitioner’s murder trial that the admission of a “letter from the grave,” which violated his confrontation clause rights, was harmless error. In review, the Seventh Circuit highlighted five guiding factors for a harmless error analysis and determined that the Wisconsin State Court’s decision was so unreasonable that fair-minded jurists could not possibly agree on the outcome.
Yet, a fair-minded jurist did find the outcome reasonable. Judge Tinder dissented from the majority opinion and explained how the Wisconsin Appellate Court’s decision, while perhaps not the best analysis, was reasonable based on the five factors highlighted by the majority. The Seventh Circuit’s majority opinion appears result driven and fails to adequately address the high level of deference given to State court decisions—raising significant policy concerns regarding state sovereignty and finality of criminal convictions if the high bar for relief is lowered.[Condense Abstract]
"Equity Will Not Enjoin a Libel": Well, Actually, Yes, It Will
Ann C. Motto
11 Seventh Circuit Rev. 271 (2016) [Full Article]
Abstract: The First Amendment prohibits prior restraints on speech. Indeed, prior restraints are the most serious and the least tolerable infringements on First Amendment rights. Because of this, for nearly 200 years, courts stood by the maxim that "equity will not enjoin a libel"; traditionally, money damages were the only remedy available to a defamed plaintiff. However, there is a modern trend among some state and federal courts allowing the issuance of a narrow, permanent injunction against statements that have been adjudicated defamatory. [Read more...]
In December 2015, the Seventh Circuit Court of Appeals in its decision McCarthy v. Fuller became the second circuit court to permit a district court to enter such an injunction. The Supreme Court has never answered the question of whether the First Amendment forbids the issuance of an injunction against defamation, but courts ought to realize that each time a permanent injunction against defamation is granted in favor of one plaintiff, everyone’s constitutional right to free speech is chilled and eroded.[Condense Abstract]
Law and Entertainment
Filming Police & Legal Dramas: Examining the Influence of Television Programs on the Legal Profession and Law Enforcement
Ryan D. Suniga
11 Seventh Circuit Rev. 303 (2016) [Full Article] [Audio Synopsis]
Abstract: Criminal trials make for inherently compelling television. There are very few things as dramatic as watching an individual being forced to defend their liberty. Because of the spectacle associated with criminal proceedings, the legal drama has evolved into a staple of television programing. Media programing like Serial and Making a Murderer can have profound effects on the operation and integrity of criminal proceedings. While televising criminal justice proceedings adds a level of accountability to those procedures, it also creates an opportunity for abuse by allowing the media to negatively influence individuals vital to the integrity of the criminal justice system throughout law enforcement and judicial proceedings. [Read more...]
Recently, the Seventh Circuit addressed some of the concerns posed by televising the criminal justice process in Hart v. Manina, and urged caution in allowing cameras into the courtroom or police interrogations. James Hart was the subject of a murder investigation where the law enforcement was being filmed for a reality television program. During the investigation, the lead detective made mistakes relating to a lineup identification.
This Note explores the concerns associated with media’s involvement in these proceedings more thoroughly, and suggests that in order to protect criminal defendants, and the criminal justice system in general, courts should impose limits on television’s intrusion into courtrooms and police proceedings. These limits should be reasonably designed to balance the benefits associated with televising these events with the potential dangers that television can unleash on the credibility of the criminal justice procedures.[Condense Abstract]
Trade Secret Law
Abstract: Today, when 70% of business value is derived from intangible assets, and trade secret misappropriation (TSM) is the most frequently litigated form of intellectual property protection, it is critical to ensure that judicial remedies for misappropriation of intellectual property remain adequate without encouraging abusive litigation. With this goal in mind, in 1979, the National Conference of Commissioners on Uniform State Laws promulgated the Uniform Trade Secrets Act (UTSA) in order to ensure a uniform and consistent treatment of trade secrets among the states. The Uniform Act displaced business torts claims that arise in common law, but only if those claims conflicted with the law of trade secrets. In its most recent decision interpreting the Illinois equivalent of the Uniform Act, Spitz v. Proven Winners, the Seventh Circuit Court of Appeals, by upholding the district court's dismissal of common-law claims on summary judgment, held that the plaintiff's statutory claim of trade secret misappropriation displaced the plaintiff's common-law claim of unjust enrichment even in the absence of a finding that the business information at issue amounted to a trade secret. As a result of this holding, TSM plaintiffs may be left without a common-law remedy if they plead, but do not adequately prove, statutory trade secret misappropriation-notwithstanding the fact that different elements are required for common-law tort claims. [Read more...]
This Article promotes legal certainty by answering the following questions: (1) whether it is appropriate to dismiss common-law claims on summary judgment, and (2) whether all common-law claims should be displaced by claims of trade secret misappropriation or whether some should be allowed. The viability of any principled approach to answering these questions and avoiding adjudicative loopholes hinges on the definition of the statutory term “displace.” Typically, courts do not give a second thought to defining the term “displace,” but the UTSA and state statutes are silent on how this term should be construed, suggesting an expectation of judicial discretion. This Article posits that the statutory term “displace” should be construed as “preempt” (adjudicate first) rather than “preclude” (prohibit). As a necessary consequence of this interpretation, displacement of common-law claims should require adjudication of concurrently brought claims of trade secret misappropriation. This Article will demonstrate that otherwise TSM plaintiffs may, erroneously, be left without any remedy, which is not consistent with statutory intent.[Condense Abstract]
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