Justia U.S. 4th Circuit Court of Appeals Opinion Summaries

In September 2020, a college student alleged she was sexually assaulted by a man during a late-night traffic stop in Virginia. She reported the incident to local law enforcement and participated in multiple interviews with detectives, who investigated her claims but found surveillance footage that was low-quality and recorded at a different time than the alleged assault. During a subsequent interview, detectives pressured her about inconsistencies in the evidence and, after the interview, she received threatening text messages. The detectives later told university officials she had confessed to fabricating her report. The sheriff then directed detectives to use her confession as probable cause for an arrest warrant charging her with filing a false police report. After her arrest, officers issued a press release with her personal information and photo, which led to widespread public shaming and emotional distress.Initially, she was convicted in a bench trial in Washington County District Court, but after appealing, her conviction was annulled and she was acquitted in a de novo bench trial in Washington County Circuit Court. She then sued the officers and the sheriff in the United States District Court for the Western District of Virginia, alleging violations of her constitutional rights and state law torts.The district court dismissed the complaint under Rule 12(b)(6), relying on an audio recording of the key interview. The court found the recording contradicted her claims of coercion, ruling that it showed a civil discussion without coercion and that her confession appeared voluntary. It also found her allegation of having no choice but to confess was not credible based on the recording.The United States Court of Appeals for the Fourth Circuit reviewed the case. It held that the district court erred by dismissing the complaint based on the audio recording, because the recording did not "blatantly contradict" her factual allegations as required by Fourth Circuit precedent. The appellate court vacated the dismissal and remanded the case for further proceedings. View "Bermeo v. Andis" on Justia Law

The dispute centers on a Florida-based construction project, where Westerfeld Construction by Glick, LLC served as the general contractor. Westerfeld, a Florida company, retained Jessup Construction, LLC as a subcontractor. Jessup and GSH of Alabama, LLC entered into a joint venture to work on the project and later obtained a $5.8 million loan from Mobilization Funding, LLC, a company with operations in South Carolina. The loan contracts involved Mobilization Funding, Jessup, GSH, and individual guarantors, and included South Carolina choice-of-law and venue provisions. Westerfeld was not a party to these loan contracts. When Jessup allegedly defaulted, Mobilization Funding sued Jessup, GSH, and the guarantors in South Carolina, and GSH, joined by individual guarantors, brought third-party claims against Westerfeld, alleging conspiracy and fraud.After removal, the United States District Court for the District of South Carolina reviewed Westerfeld’s motion to dismiss for lack of personal jurisdiction. Applying the prima facie standard, the district court held that it lacked both general and specific jurisdiction over Westerfeld. The court found Westerfeld had no offices, employees, or business activities in South Carolina and was not party to any South Carolina-centered agreements. The court also determined that GSH’s conspiracy allegations were conclusory and did not plausibly tie Westerfeld to conduct in South Carolina sufficient to establish jurisdiction. The district court dismissed the third-party complaint against Westerfeld and certified its order as final.On appeal, the United States Court of Appeals for the Fourth Circuit reviewed the district court’s ruling de novo. The Fourth Circuit affirmed, holding that Westerfeld did not have sufficient minimum contacts with South Carolina to justify the exercise of personal jurisdiction under the Due Process Clause. The court rejected both direct and conspiracy-based theories of jurisdiction, concluding that GSH failed to present plausible, particularized facts to support jurisdiction over Westerfeld. The judgment of dismissal was affirmed. View "Stokes v. Westerfeld Construction by Glick, LLC" on Justia Law

A dispute arose from the design and installation of cabinetry in a luxury home in Charleston, South Carolina. Design Gaps, Inc., owned by David and Eva Glover, had a longstanding business relationship with Shelter, LLC, a general contractor operated by Ryan and Jenny Butler. After being dissatisfied with Design Gaps’ performance, the homeowners, Dr. Jason and Kacie Highsmith, and Shelter terminated their contract with Design Gaps and hired Distinctive Design & Construction LLC, owned by Bryan and Wendy Reiss, to complete the work. The Highsmiths and Shelter initiated arbitration against Design Gaps, which led to the arbitrator ruling in favor of the homeowners and Shelter on their claims, and against Design Gaps on its counterclaims, including those for copyright infringement, tortious interference, and unfair trade practices.After the arbitration, Design Gaps sought to vacate the arbitration award in the United States District Court for the District of South Carolina, but the court instead confirmed the award. Concurrently, Design Gaps filed a separate federal lawsuit against several parties, including some who were not part of the arbitration. The defendants moved to dismiss, arguing that res judicata and collateral estoppel barred the new claims, or alternatively, that the claims failed on other grounds such as the statute of limitations and laches. The district court agreed, dismissing most claims based on preclusion or other legal bars, and granted summary judgment on the remaining claims.The United States Court of Appeals for the Fourth Circuit reviewed the district court’s decisions. The court held that res judicata and collateral estoppel applied to bar most of Design Gaps’ claims, even against parties not directly involved in the arbitration but in privity with those who were. For the remaining claims, the court found they were properly dismissed on grounds such as the statute of limitations, waiver, or laches. The Fourth Circuit affirmed the district court’s judgment in full. View "Design Gaps, Inc. v. Distinctive Design & Construction LLC" on Justia Law

The case involved two related companies and three individuals who operated a business targeting immigrants detained by U.S. Immigration and Customs Enforcement (ICE) and eligible for release on immigration bonds. The companies marketed their services as an affordable way to secure release, but in reality, they charged high fees for services that were often misrepresented or not provided. The agreements were complex, mostly in English, and required significant upfront and recurring payments. Most consumers did not understand the terms and relied on the companies’ oral representations, which were deceptive. The business was not licensed as a bail bond agent or surety, and the defendants’ practices violated federal and state consumer protection laws.After the plaintiffs—the Consumer Financial Protection Bureau, Massachusetts, New York, and Virginia—filed suit in the United States District Court for the Western District of Virginia, the defendants repeatedly failed to comply with discovery obligations and court orders. They did not produce required documents, ignored deadlines, and failed to appear at hearings. The district court, after multiple warnings and opportunities to comply, imposed default judgment as a sanction for this misconduct. The court also excluded the defendants’ late-disclosed witnesses and exhibits from the remedies hearing, finding the nondisclosures unjustified and prejudicial.The United States Court of Appeals for the Fourth Circuit reviewed the case and affirmed the district court’s decisions. The Fourth Circuit held that the default judgment was an appropriate sanction for the defendants’ repeated and willful noncompliance. The exclusion of evidence and witnesses was also upheld, as was the issuance of a permanent injunction and the calculation of monetary relief, including restitution and civil penalties totaling approximately $366.5 million. The court found no abuse of discretion or legal error in the district court’s rulings and affirmed the final judgment in all respects. View "Consumer Financial Protection Bureau v. Nexus Services, Inc." on Justia Law

A flight attendant on a Delta Air Lines flight observed a 13-year-old passenger crying during turbulence and believed the man accompanying her was behaving inappropriately. Concluding that the man was sexually assaulting and trafficking the child, the attendant reported her concerns to the flight captain, who relayed the information to a station manager. The manager contacted local police, who detained and questioned the man, Nicholas Cupp, and his daughter upon landing. After investigation, police determined Cupp was the child’s father and released him without charges. Cupp later filed suit, alleging the report was false and reckless, and claimed significant emotional distress and harm to his relationship with his daughter.The case was initially filed in the Circuit Court of Newport News, Virginia, but was removed to the United States District Court for the Eastern District of Virginia based on diversity jurisdiction. The defendants moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), arguing immunity under Virginia Code § 63.2-1512 for good-faith reports of suspected child abuse. The district court granted the motion, finding the immunity statute applicable even though the report was made to law enforcement rather than directly to social services, and concluded that Cupp had not sufficiently alleged bad faith or malicious intent.On appeal, the United States Court of Appeals for the Fourth Circuit reviewed whether a nonmandatory reporter who makes a good-faith complaint of suspected child abuse to law enforcement, rather than directly to social services, is entitled to immunity under Virginia Code § 63.2-1512. Finding no controlling Virginia precedent, the Fourth Circuit certified this question to the Supreme Court of Virginia, as its answer will determine whether the district court’s dismissal should be affirmed or reversed. View "Cupp v. Delta Air Lines, Inc." on Justia Law

A North Carolina police officer, Clarence Belton, was shot multiple times by fellow officer Heather Loveridge during the execution of a search warrant. The incident, which resulted in serious injuries to Belton and ended his law enforcement career, was captured on video and body camera footage. Belton sued Loveridge and the City of Charlotte, alleging excessive force and other claims. During the litigation, both parties moved to seal the video exhibits related to the shooting, and the district court granted these motions, placing the footage under seal.After the district court denied Loveridge’s motion for summary judgment, which was later vacated and remanded by the United States Court of Appeals for the Fourth Circuit, a local television station, WBTV, sought to intervene in the case to unseal the video footage. Belton supported WBTV’s motion, but Loveridge opposed it, arguing that unsealing would jeopardize her right to a fair trial. The United States District Court for the Western District of North Carolina denied WBTV’s motion to intervene, citing lack of jurisdiction due to the pending appeal, and also denied the motion to unseal, finding no right of access under the common law or the First Amendment and concluding that Loveridge’s fair trial rights outweighed any public interest.On appeal, the United States Court of Appeals for the Fourth Circuit affirmed the district court’s denial of WBTV’s motion to intervene, agreeing that the district court lacked jurisdiction at that stage. However, the appellate court treated WBTV’s appeal regarding the sealing order as a petition for a writ of mandamus. The Fourth Circuit held that the district court’s order sealing the video exhibits violated the First Amendment right of access to judicial records. The court vacated the sealing order and remanded with instructions to unseal the video footage, finding that Loveridge had not met her burden to justify continued sealing. View "Gray Media Group, Inc. v. Loveridge" on Justia Law

Dorothy Seabrook, a black woman, was the Family Programs Manager for the U.S. Army Reserve Command at Fort Bragg, North Carolina. In 2013, she was involved in disciplinary actions against an employee, Scott Hamilton. Subsequently, the Army investigated Seabrook for creating a toxic work environment and making inappropriate comments and physical contact. In 2014, she was suspended for two weeks and reassigned to another division. Seabrook filed an Equal Employment Opportunity (EEO) complaint in January 2015, alleging discrimination based on race, color, and sex. She received a poor performance evaluation in February 2015, which she believed was retaliatory, leading her to file a second EEO complaint.The Equal Employment Opportunity Commission (EEOC) investigated and found no discrimination. Seabrook then filed a pro se complaint in federal court, which was construed as alleging disparate treatment, hostile work environment, and retaliation under Title VII. The United States District Court for the Eastern District of North Carolina dismissed her complaint for failure to state a claim and denied her motion to alter or amend the judgment.The United States Court of Appeals for the Fourth Circuit reviewed the case. The court affirmed the district court's dismissal, holding that Seabrook failed to plausibly allege that the Army's actions were motivated by discriminatory bias. The court found that Seabrook's allegations did not support claims of disparate treatment, as her comparators were not similarly situated. Her hostile work environment claim failed because the alleged actions were not objectively abusive or severe. Lastly, her retaliation claim was dismissed due to a lack of causal connection between her EEO activity and the adverse employment actions. The court concluded that Seabrook's complaint did not meet the pleading standards required to survive a motion to dismiss. View "Seabrook v. Driscoll" on Justia Law

Plaintiffs filed a class action lawsuit in state court against Defendants, alleging violations of state securities laws. Defendants removed the case to federal court under the Securities Litigation Uniform Standards Act (SLUSA), arguing that the case involved covered securities. Plaintiffs amended their complaint to exclude any claims related to covered securities, leading the district court to remand the case to state court. After three years of state court litigation, Defendants removed the case again, citing an expert report that allegedly identified covered securities. The district court remanded the case again and awarded Plaintiffs $63,007.50 in attorneys' fees.The United States District Court for the District of South Carolina initially denied Plaintiffs' motion to remand but later granted it after Plaintiffs amended their complaint. The court found that the amended complaint excluded any claims related to covered securities, thus SLUSA did not apply, and no federal question remained. After Defendants removed the case a second time, the district court remanded it again and awarded attorneys' fees, finding the second removal lacked a reasonable basis.The United States Court of Appeals for the Fourth Circuit reviewed the case and affirmed the district court's award of attorneys' fees. The court held that the second removal was improper because the amended complaint explicitly excluded claims related to covered securities, and thus SLUSA did not apply. Additionally, the court found that the removal was objectively unreasonable, as the district court had already addressed the issues in its first remand order. The Fourth Circuit also denied Plaintiffs' request for additional attorneys' fees for defending the appeal, stating that 28 U.S.C. § 1447(c) does not authorize fee awards on appeal. View "Black v. Mantei & Associates, Ltd." on Justia Law

CPI Security Systems, Inc. filed a lawsuit against Vivint Smart Home, Inc., alleging that Vivint engaged in deceptive practices to lure away CPI’s customers. Vivint sales representatives falsely claimed that Vivint had acquired CPI, that CPI was going out of business, or that Vivint needed to upgrade CPI’s equipment. These tactics led many CPI customers to switch to Vivint, causing significant losses for CPI. A jury found Vivint liable for violating the Lanham Act, the North Carolina Unfair and Deceptive Trade Practices Act (UDTPA), and for committing the common-law torts of unfair competition and tortious interference with contracts. The jury awarded CPI $49.7 million in compensatory damages and $140 million in punitive damages.The United States District Court for the Western District of North Carolina upheld the jury’s verdict. Vivint appealed, raising several issues, including the requirement of CPI’s reliance on false statements for the UDTPA claim, the sufficiency of evidence supporting the damages award, the application of North Carolina’s cap on punitive damages, and the admission of prejudicial evidence.The United States Court of Appeals for the Fourth Circuit reviewed the case and found no reversible error. The court held that CPI was not required to prove its own reliance on Vivint’s false statements to establish a UDTPA claim, as the claim was based on unfair competition rather than fraud. The court also found that the evidence presented by CPI was sufficient to support the jury’s damages award. Additionally, the court ruled that the district court correctly applied North Carolina’s cap on punitive damages by considering the total compensatory damages awarded. The court further held that the district court did not abuse its discretion in denying Vivint’s motion to bifurcate the trial or in its evidentiary rulings. The reassignment of the trial judge post-trial did not warrant a new trial. Consequently, the Fourth Circuit affirmed the district court’s judgment. View "CPI Security Systems, Inc. v. Vivint Smart Home, Inc." on Justia Law

A Virginia statute established procedures for internet broadband service providers to access railroad property and lay cable across tracks. The Association of American Railroads (AAR) challenged the statute, arguing it was preempted by federal law and violated the Takings Clause of the U.S. Constitution. The district court dismissed the case, ruling that AAR lacked standing to bring the claims because they required the participation of individual member railroads.The United States District Court for the Eastern District of Virginia held that AAR lacked associational standing for both its preemption and Takings Clause claims. The court found that the preemption claim required a fact-intensive inquiry into whether the statute unreasonably burdened rail transportation, necessitating individual member participation. Similarly, the Takings Clause claim required individualized proof of inadequate compensation for each crossing, which also required member participation.The United States Court of Appeals for the Fourth Circuit reviewed the case. The court held that AAR had standing to pursue its preemption claims, as these could be litigated without the participation of individual members. The court reasoned that the preemption claims involved general judgments about the statute's nature and operation, not specific operations of individual railroads. However, the court affirmed the district court's ruling on the Takings Clause claim, agreeing that it required individualized proof of compensation for each crossing, necessitating member participation.The Fourth Circuit thus affirmed the district court's judgment in part, reversed it in part, and remanded the case for further proceedings consistent with its opinion. View "Association of American Railroads v. Hudson" on Justia Law