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

A Dutch life insurance company, through its trustees, sought to enforce an arbitral award against its former owners after they failed to maintain the company’s required solvency capital ratio, as agreed. When the capital ratio fell below the stipulated threshold, the company initiated urgent arbitration proceedings in the Netherlands, resulting in an award ordering the owners to restore the ratio and imposing a substantial penalty for noncompliance. Despite confirmations of the award by Dutch courts—including the Court of Rotterdam, the Court of Appeal of the Hague, and the Supreme Court of the Netherlands—the owners did not comply, leading to the company's liquidation.The trustees filed a petition in the United States District Court for the Middle District of North Carolina, seeking to confirm the arbitration award under the Federal Arbitration Act (FAA) and the New York Convention, as well as to recognize the Dutch court’s judgment under the North Carolina Uniform Foreign-Country Money Judgments Recognition Act. The district court found the arbitration award enforceable, holding the FAA’s three-year statute of limitations was “permissive,” not “mandatory,” and also concluded the Dutch judgment was recognizable as a foreign-country judgment under North Carolina law. The court entered judgment, confirming the award under federal law and did not rule on the alternative state-law claim.On appeal, the United States Court of Appeals for the Fourth Circuit held that the three-year statute of limitations in 9 U.S.C. § 207 is mandatory, not permissive, and reversed the district court’s order confirming the foreign arbitral award under the FAA due to untimeliness. However, the appellate court agreed that the Dutch court judgment qualifies for recognition under the North Carolina Act and remanded the case for further proceedings on the petitioners’ motion to enforce that judgment under state law. View "van Faassen v. Lindberg" on Justia Law

An American software company based in North Carolina and a Dutch company entered into a business relationship that later soured. The American company alleged that the Dutch company stole its brand name, software code, and customer base. The Dutch company operated a website nearly identical to the American company’s, using its name, logo, and marketing materials, and targeted American customers, even convincing at least one U.S. company to switch providers. Disputes between the parties also led to reciprocal lawsuits in both the United States and the Netherlands, with overlapping subject matter.The United States District Court for the Western District of North Carolina initially issued a preliminary injunction against the Dutch company, finding the American company was likely to succeed on its copyright, trademark, trade secret, and tortious interference claims. After the Supreme Court’s decision in Abitron Austria GmbH v. Hetronic International, Inc. altered the standard for the extraterritorial application of the Lanham Act, the district court modified its injunction to comply with the new “conduct-focused” approach and dismissed the copyright claim. The district court also ordered the Dutch company to correct statements made to the Dutch court and later held the company in civil contempt for failing to comply fully, imposing a monetary sanction.The United States Court of Appeals for the Fourth Circuit reviewed the case. Applying the Supreme Court’s new guidance from Abitron, the Fourth Circuit affirmed the second amended preliminary injunction, holding that the Dutch company’s conduct constituted infringing use in U.S. commerce under the Lanham Act, and that the Defend Trade Secrets Act’s express extraterritorial provision was satisfied by acts in furtherance of misappropriation occurring in the United States. The court dismissed the appeals from the correction and contempt orders for lack of appellate jurisdiction. View "Dmarcian, Inc. v. DMARC Advisor BV" on Justia Law

A North Carolina software company initiated a lawsuit in the United States District Court for the Western District of North Carolina against its former business partner, a Dutch entity, after their business relationship dissolved. The plaintiff alleged copyright and trademark infringement, misappropriation of trade secrets, and various state law violations. Shortly after the complaint, the plaintiff obtained a preliminary injunction limiting the defendant’s business activities. Meanwhile, the defendant commenced related litigation in the Netherlands. During those Dutch proceedings, the defendant’s American attorney, Pressly Millen, submitted an affidavit that the plaintiff claimed misrepresented the scope and timing of the U.S. litigation.The Dutch court initially denied the plaintiff’s request to stay the Dutch proceedings, partly relying on representations from the defendant’s counsel. The plaintiff returned to the North Carolina court, seeking an order requiring the defendant to correct these alleged misrepresentations in the Dutch court. The district court ordered the defendant to submit both its order and a corrective statement to the Dutch court. The defendant submitted the order but did not file the separate corrective statement. Later, the Dutch court stayed its proceedings. The plaintiff then moved for contempt sanctions in the North Carolina court against the defendant and its attorneys for failing to comply fully with the correction order. Following a show cause hearing, the district court held the defendant and Millen in civil contempt, sanctioning Millen by suspending his ability to practice in the district, though not holding him jointly liable for monetary sanctions.On appeal, the United States Court of Appeals for the Fourth Circuit found that it had jurisdiction to review the contempt order against Millen, a nonparty. The appellate court held that the district court abused its discretion by imposing civil contempt sanctions on Millen without clear and convincing evidence that the plaintiff was harmed by Millen’s failure to submit the separate statement. The court vacated the civil contempt adjudication and sanction against Millen. View "Dmarcian, Inc. v. Millen" on Justia Law

During the onset of the COVID-19 pandemic, a limited liability company (LLC), FS Medical Supplies, entered into a contract to supply personal protective equipment and related products to TannerGAP, Inc. and Tanner Pharma UK Limited for distribution. FS Medical later discovered that the Tanner entities had contracted directly with one of its suppliers, prompting FS Medical to sue for breach of contract.Initially, FS Medical brought suit in California state court, but the defendants removed the case to federal court, where it was dismissed for lack of personal jurisdiction. FS Medical then filed two actions in the United States District Court for the Western District of North Carolina, asserting diversity jurisdiction under 28 U.S.C. § 1332(a)(3). FS Medical alleged that its members were citizens of Texas and California, and later acknowledged that one member was a citizen of China. The defendants included both U.S. citizens domiciled in North Carolina and a United Kingdom corporation. After limited discovery and amendment of the complaint, the district court, following a magistrate judge’s recommendation, dismissed the actions for lack of subject matter jurisdiction, concluding that the presence of both domestic and foreign members in the plaintiff LLC destroyed diversity jurisdiction.On appeal, the United States Court of Appeals for the Fourth Circuit reviewed the dismissal de novo. The court held that, under § 1332(a)(3), complete diversity requires at least one U.S. citizen on each side of the action. Because FS Medical, as an LLC, had both domestic and foreign members at the time the complaints were filed, and because there were foreign defendants as well, the suit was not between “citizens of different States.” The Fourth Circuit affirmed the district court’s dismissal and declined to grant relief under North Carolina’s savings statute, finding it lacked jurisdiction to do so. View "FS Medical Supplies, LLC v. Tanner Pharma UK Limited" on Justia Law

South Carolina has administered its own workplace safety program under federal law for decades. In July 2016, the Occupational Safety and Health Administration (OSHA) issued an interim final rule requiring states with their own plans to increase monetary penalties in line with federal levels. South Carolina did not adjust its penalties, and OSHA’s annual monitoring reports repeatedly noted this issue without finding formal noncompliance until 2022. That year, OSHA formally found South Carolina noncompliant and recommended legislative changes to bring the state into alignment with federal standards.Previously, in 2022, South Carolina officials challenged only OSHA’s 2022 inflation adjustment in the United States District Court for the District of South Carolina. The district court held that the 2022 adjustment was not a final agency action and dismissed the claim. In 2023, South Carolina brought a new suit in the same court, this time challenging the 2016 interim final rule under the Administrative Procedure Act (APA). The Department of Labor moved to dismiss, arguing the claims were untimely under the APA’s six-year statute of limitations. The district court agreed, finding that any injury occurred when the 2016 rule was promulgated and dismissed the APA claims as time-barred.On appeal, the United States Court of Appeals for the Fourth Circuit reviewed whether the APA claims were timely. The court held that a claim accrues when the plaintiff is injured by a final agency action, which, in this case, was when the 2016 rule was published. The court determined that South Carolina could have filed suit as early as 2016 and was therefore outside the six-year limitations period. The court also noted that South Carolina may still raise its substantive arguments if an enforcement action is initiated. The Fourth Circuit affirmed the district court’s dismissal. View "McMaster v. Department of Labor" on Justia Law

Deque Systems Inc., a company specializing in web accessibility software, developed and registered multiple versions of its DevTools and Rules Help Pages products. To access these, users agreed not to copy, reverse-engineer, or otherwise misuse the software or its documentation. In 2021, BrowserStack, a competing firm, sought to develop its own accessibility testing tools. More than 100 BrowserStack employees created accounts with Deque—agreeing to Deque’s terms—and later, BrowserStack released an Accessibility Toolkit, which Deque alleged was developed by unlawfully copying and reverse-engineering DevTools and the Rules Help Pages.Deque filed suit in the United States District Court for the Eastern District of Virginia, claiming copyright infringement, false advertising, breach of contract, and unjust enrichment, and sought injunctive relief, damages, and other remedies. During discovery, Deque repeatedly failed to properly disclose its damages calculations and supporting evidence by the deadlines set in the court’s scheduling order. Despite several opportunities to supplement its disclosures and a late attempt to introduce expert testimony, Deque did not timely provide the required information. BrowserStack moved to exclude Deque’s damages evidence and for summary judgment. The district court granted these motions, finding that Deque’s noncompliance with disclosure rules was neither substantially justified nor harmless, and that Deque presented no evidence supporting injunctive or other relief.On appeal, the United States Court of Appeals for the Fourth Circuit reviewed and affirmed the district court’s judgment. The Fourth Circuit held that the district court did not abuse its discretion in excluding all evidence of Deque’s damages under Federal Rule of Civil Procedure 37(c)(1) due to repeated and unjustified failures to comply with disclosure requirements. The court also held that summary judgment for BrowserStack was warranted because Deque could not establish entitlement to injunctive, declaratory, or monetary relief. View "Deque Systems Inc. v. Browserstack, Inc." on Justia Law

While incarcerated at Sussex 1 State Prison in Virginia, the plaintiff was accused of indecent exposure in July 2017. He consistently denied the charge and urged prison officials to review video footage from a RapidEye camera, which he claimed would show he was elsewhere when the incident occurred. The officials did not review the footage, stating it was of poor quality and not helpful, and ultimately found the plaintiff guilty after a delayed hearing. As a result of this conviction, and considering his prior offenses, the plaintiff’s security classification was increased and he was transferred to a higher-security facility. He requested that the video footage be preserved, but the prison officials failed to do so.The plaintiff filed suit, alleging procedural due process and First Amendment retaliation claims. The United States District Court for the Eastern District of Virginia initially dismissed the due process claim and granted summary judgment on the retaliation claim. On appeal, the United States Court of Appeals for the Fourth Circuit reversed, noting the importance of the missing video evidence to the plaintiff’s case and remanded for further proceedings. During discovery on remand, it became clear that the video footage had not been preserved, leading the plaintiff to move for spoliation sanctions. The magistrate judge began considering the sanctions motion, but the district court granted summary judgment to the defendants on all claims before ruling on the sanctions issue.The United States Court of Appeals for the Fourth Circuit held that the district court abused its discretion by granting summary judgment before addressing the plaintiff’s motion for sanctions related to the missing video footage. Because the footage was central to the claims, the appellate court vacated the district court’s decision and remanded with instructions to fully consider the sanctions motion. View "Shaw v. Foreman" on Justia Law

A group of children in West Virginia’s foster care system filed a class action lawsuit against state officials, alleging systemic failures by the state agencies responsible for their care. The plaintiffs claimed the state’s practices resulted in widespread abuses, neglect, inadequate placements, understaffing, and failure to provide necessary physical and mental health services. They alleged violations of their constitutional rights under the Fourteenth Amendment, as well as statutory violations under the Adoption Assistance and Child Welfare Act, the Americans with Disabilities Act, and the Rehabilitation Act. The class action encompassed approximately 6,800 foster children, with additional subclasses for kinship placements, children with disabilities, and those aging out of the system.The United States District Court for the Southern District of West Virginia initially dismissed the case on abstention and mootness grounds, but that decision was reversed by the United States Court of Appeals for the Fourth Circuit in Jonathan R. ex rel. Dixon v. Justice. Upon remand, the district court certified the General Class and ADA Subclass, denied certification of other subclasses, and proceeded with discovery. In February 2025, the district court, acting sua sponte and without notice or briefing, dismissed the case with prejudice for lack of standing, finding that it lacked power under Article III to grant the requested injunctive and declaratory relief and concluding the plaintiffs’ injuries were not redressable.The United States Court of Appeals for the Fourth Circuit reviewed the dismissal de novo. It held that federal courts have the authority and duty to remedy systemic constitutional violations, including through comprehensive injunctive relief and declaratory judgments in institutional reform cases. The court found that the plaintiffs’ injuries were sufficiently concrete and ongoing, and that the requested relief was likely to redress those injuries. The district court’s dismissal was reversed and the case remanded for further proceedings. The Fourth Circuit declined to reassign the case to a new judge and found West Virginia’s cross-appeal on class decertification unreviewable at this stage. View "Jonathan R. v. Morrisey" on Justia Law

A nurse formerly employed at a West Virginia hospital system brought a qui tam action on behalf of the United States under the False Claims Act. She alleged that the hospital system, its affiliated entities, and a former executive submitted claims to the federal government that were prohibited by the Stark Law and the Anti-Kickback Statute. Specifically, she claimed that the defendants’ compensation and financial arrangements with physicians created unlawful incentives for referrals, resulting in the submission of false claims to Medicare between 2013 and 2022. The complaint included detailed tables of claims and described physician compensation structures, as well as financial transfers between entities within the health system.The United States District Court for the Southern District of West Virginia reviewed the case after the government declined to intervene. The court dismissed the amended complaint for failure to plead fraud with the particularity required by Rule 9(b) of the Federal Rules of Civil Procedure. The district court found that the complaint did not sufficiently allege the necessary elements of a False Claims Act violation, including a plausible connection between physician compensation and prohibited referrals, or that any claims submitted were actually false under the Stark Law or the Anti-Kickback Statute. The district court also denied the plaintiff’s post-judgment motions to vacate the judgment and for leave to amend the complaint, finding that additional amendment would prejudice the defendants after years of litigation and access to substantial discovery.On appeal, the United States Court of Appeals for the Fourth Circuit affirmed the district court’s dismissal and denial of leave to amend. The Fourth Circuit held that the complaint did not plead fraud with the required particularity, failed to plausibly allege violations of the Stark Law or the Anti-Kickback Statute, and did not present facts sufficient to support claims of conspiracy or reverse false claims. The court found no abuse of discretion in denying post-judgment relief. View "United States ex rel. Kyer v. Thomas Health System, Inc." on Justia Law

The case centers on the operations of a chemical manufacturing facility in Parkersburg, West Virginia, owned by The Chemours Company. Chemours used hexafluoropropylene oxide dimer acid (HFPO-DA), a member of the PFAS class of chemicals, as a processing aid in polymer production. The company discharged wastewater containing HFPO-DA into the Ohio River under a Clean Water Act (CWA) permit that established specific effluent limits. However, from 2022 onward, Chemours exceeded these limits on multiple occasions. Local water testing showed that HFPO-DA concentrations sometimes surpassed newer, not-yet-enforceable federal health standards but did not exceed West Virginia’s own goals. Chemours entered into an administrative consent order with the EPA to address permit compliance.The United States District Court for the Southern District of West Virginia reviewed a citizen suit brought by West Virginia Rivers Coalition, Inc., seeking a preliminary injunction against Chemours for ongoing permit violations. The district court found that the Coalition had Article III associational standing through a member who avoided boating in the Ohio River due to Chemours’ discharges. The court granted the preliminary injunction, enjoining Chemours from exceeding permit limits and requiring remedial measures. Chemours appealed, challenging both the standing determination and the irreparable harm finding.The United States Court of Appeals for the Fourth Circuit examined both issues. The court agreed that the Coalition had established a substantial likelihood of standing at this stage. However, it found that the district court committed legal errors in its irreparable harm analysis, including incorrectly presuming harm from permit violations and conflating harm to the public with harm to the plaintiff. The Fourth Circuit also found clear error in the factual findings regarding irreparable harm. Accordingly, the Fourth Circuit vacated the preliminary injunction granted by the district court. View "West Virginia Rivers Coalition, Inc. v. The Chemours Company FC, LLC" on Justia Law