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

Several individuals brought a class action lawsuit against a group of insurance companies after a data breach compromised the driver’s license numbers of nearly three million people. The breach occurred when hackers exploited the companies’ online insurance quoting platform, which auto-populated sensitive information using data from both customers and third-party sources. The plaintiffs, whose information was compromised, alleged various harms, including time spent monitoring their financial records, increased risk of identity theft, emotional distress, and, for two plaintiffs, discovery of their driver’s license numbers on the dark web.The United States District Court for the Eastern District of Virginia dismissed the consolidated class action complaint, finding that none of the named plaintiffs had standing to pursue their claims. The district court concluded that the alleged injuries were either too speculative or not sufficiently concrete to satisfy Article III’s standing requirements, and granted the defendants’ motion to dismiss under Rule 12(b)(1).On appeal, the United States Court of Appeals for the Fourth Circuit reviewed whether the plaintiffs had standing to bring suit. The Fourth Circuit held that two plaintiffs, who alleged that their driver’s license numbers were actually posted on the dark web, suffered a concrete and particularized injury analogous to the common-law tort of public disclosure of private information. This injury was sufficient to confer standing to seek damages. However, the court found that the other plaintiffs, who did not allege their information was made public, lacked standing because their alleged injuries—such as increased risk of future harm, time spent on mitigation, and emotional distress—were either not imminent or not independently sufficient for standing. The Fourth Circuit therefore affirmed the district court’s dismissal as to those plaintiffs, reversed as to the two plaintiffs with information posted on the dark web, and remanded for further proceedings. View "Holmes v. Elephant Insurance Co." 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

Three individuals were tried and convicted following a three-week jury trial for their involvement in a violent criminal enterprise. The evidence showed that they were members of a gang operating in northern Virginia and participated in two attempted murders in 2019. One victim was lured into a car, attacked, and left for dead, while another was targeted after surveillance and shot. The defendants played various roles, including driving, surveillance, and assisting in evasion from law enforcement. The charges included racketeering conspiracy, conspiracy to commit murder, drug distribution conspiracy, and, for some, attempted murder, assault with a dangerous weapon, and firearms offenses.The United States District Court for the Eastern District of Virginia presided over the trial. During the proceedings, issues arose regarding the quality of interpretation provided by a court-appointed interpreter, leading the defendants to move for a mistrial. The district court conducted a hearing, found the interpretation errors to be limited and not material, and denied the motion for mistrial. After the trial, the government disclosed unrelated official misconduct by its expert witness on gangs, prompting the defendants to move for a new trial. The district court denied this motion, finding the new evidence was merely impeaching and not material, given the overwhelming evidence of guilt.The United States Court of Appeals for the Fourth Circuit reviewed the case. It held that the interpretation errors did not rise to the level of a constitutional or structural error, as they were isolated and did not render the trial fundamentally unfair. The court also held that the post-trial disclosure regarding the government’s expert witness did not warrant a new trial under Rule 33 or Brady, as it was not material and would not have likely produced a different result. The Fourth Circuit affirmed the district court’s judgment. View "US v. Sandoval" on Justia Law

Marian Hudak was charged with two federal hate crimes after separate assaults on two men in North Carolina. The first victim, J.D., was a Mexican-American neighbor whom Hudak had repeatedly harassed with racial slurs and threats, culminating in a physical attack. The second victim, J.S., was a Black man whom Hudak confronted in traffic, using racial epithets and threats, and physically attacked his vehicle before chasing him to his apartment complex and threatening further violence. Evidence showed Hudak possessed Nazi and Ku Klux Klan memorabilia and had a history of expressing racist views.The United States District Court for the Middle District of North Carolina presided over Hudak’s trial. The government presented evidence of Hudak’s racist motives, including testimony about his Nazi memorabilia and prior racist conduct. Hudak conceded intent to injure and intimidate but argued his actions were due to road rage and mental illness, not racial animus. The district court excluded expert testimony about Hudak’s mental illness, finding it unreliable and irrelevant under Federal Rule of Evidence 702 and the Insanity Defense Reform Act, since Hudak did not plead insanity. The court also admitted evidence of Nazi memorabilia after Hudak testified about his interest in military history, determining he had “opened the door” to its relevance.On appeal, the United States Court of Appeals for the Fourth Circuit reviewed the district court’s evidentiary rulings for abuse of discretion. The Fourth Circuit held that the district court properly excluded the mental health evidence and correctly admitted the Nazi memorabilia after Hudak’s own testimony. The court affirmed the jury’s verdict, holding that the government only needed to prove the victims’ race or national origin was a but-for cause of the assaults, and that Hudak received a fair trial. The judgment of the district court was affirmed. View "United States v. Hudak" on Justia Law

Ann Tierney Smith owned real property in West Virginia but failed to pay the assessed real estate taxes for 2016. As a result, the Mercer County Sheriff sold a tax lien on the property to Ed Boer. Boer sought a tax deed and provided the West Virginia State Auditor’s Office with a list of individuals to be notified about the right to redeem the property, including Smith. However, Boer did not include Smith’s current mailing address, which was available in county records. Notices sent by mail were returned as undeliverable, and attempts at personal service were unsuccessful, leading to notices being posted at the property and other addresses. After the redemption deadline passed, G. Russell Rollyson, Jr., an employee of the State Auditor’s Office, issued a tax deed to Boer. Smith learned of the deed in late 2020.Smith, and later her estate representatives, sued Rollyson and Boer under 42 U.S.C. § 1983, alleging deprivation of property without due process. The United States District Court for the Southern District of West Virginia granted summary judgment to Rollyson, finding him entitled to qualified immunity. The court determined that while Rollyson could have directed Boer to search county records for Smith’s address after the mailed notices were returned, the duty to do so was not clearly established at the time. The estate representatives appealed the decision.The United States Court of Appeals for the Fourth Circuit reviewed the district court’s summary judgment and qualified immunity rulings de novo. The Fourth Circuit held that it was not clearly established on April 1, 2019, that Rollyson was required to have Boer search county records anew for Smith’s address after the mailed notices were returned. The court found that existing precedent did not prescribe a specific follow-up measure and that Rollyson’s actions did not violate clearly established law. The judgment of the district court was affirmed. View "Ann deWet v. G. Russell Rollyson, Jr." on Justia Law

Horace Meredith worked as a coal miner for several decades, with his last employment at Hobet Mining, Inc. During Meredith’s tenure at Hobet, Arch Coal Company, Inc. was Hobet’s parent company and provided self-insurance for black lung liabilities. Years after Meredith left Hobet and after Arch had sold Hobet to Magnum Coal (which was later acquired by Patriot Coal Company), Meredith filed a claim for black lung benefits. By the time of his claim, both Patriot and Hobet were defunct, and the Department of Labor sought to hold Arch liable for Meredith’s benefits, despite Arch no longer owning or insuring Hobet.After Meredith filed his claim, the district director designated Hobet as the responsible operator and Arch as the insurance carrier. Arch and Hobet contested this designation, arguing that Arch was no longer responsible for Hobet’s liabilities and that the Black Lung Disability Trust Fund should cover the claim. The Administrative Law Judge (ALJ) found Hobet to be the responsible operator and Arch liable as its self-insurer at the time of Meredith’s last employment. The Department of Labor’s Benefits Review Board affirmed the ALJ’s decision, holding Hobet and Arch liable for the claim.The United States Court of Appeals for the Fourth Circuit reviewed the Board’s decision. The court held that neither the Black Lung Benefits Act nor its regulations imposed liability on Arch under these circumstances. Specifically, the court found that Hobet did not meet the regulatory requirements to be a financially capable responsible operator, and Arch could not be held liable as a self-insurer for claims filed long after it ceased to own or insure Hobet. The Fourth Circuit granted the petition for review, vacated the Board’s decision, and remanded for further proceedings consistent with its opinion. View "Hobet Mining, Inc. v. Director, Office of Workers' Compensation Programs" 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

The defendant was charged with one count of wire fraud after orchestrating a scheme in which he falsely presented himself as a wealthy and experienced investor to at least ten individuals, promising guaranteed returns on investments in the stock market and a cannabis store. Instead of investing the funds, he used the money for personal expenses. To maintain the appearance of legitimacy, he provided promissory notes and sent updates to victims about their supposed investments. When victims requested their money, he made excuses and, at times, threatened them.The United States District Court for the Western District of North Carolina accepted the defendant’s guilty plea to wire fraud. At sentencing, the court applied a two-level enhancement for abuse of trust under U.S.S.G. § 3B1.3, based on evidence that the defendant had assumed a position of trust with his victims by posing as a financial advisor and investor. The court also imposed two discretionary conditions of supervised release, requiring participation in substance abuse testing and treatment, and transitional support services. The defendant objected to the abuse-of-trust enhancement but did not object to the supervised release conditions.On appeal, the United States Court of Appeals for the Fourth Circuit reviewed the district court’s factual findings for clear error and its legal interpretations de novo. The Fourth Circuit held that the abuse-of-trust enhancement was properly applied because the defendant provided sufficient indicia to his victims that he held a position of private trust, even though he was an imposter. The court also held that the challenged supervised release conditions did not constitute an improper delegation of judicial authority to the Probation Officer, relying on its precedent. The judgment of the district court was affirmed. View "United States v. Brewer" 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

Two former employees of a large technology company, along with a real estate developer and related individuals and entities, were alleged to have engaged in a kickback scheme involving real estate transactions in Northern Virginia. The employees, responsible for managing real estate deals for the company, allegedly steered contracts to the developer’s firm in exchange for secret payments funneled through a network of trusts and entities. The scheme purportedly inflated the company’s costs for both leasing and purchasing properties, with millions of dollars in kickbacks distributed among the participants. The company discovered the scheme after a whistleblower report, conducted an internal investigation, and reported the matter to federal authorities.The United States District Court for the Eastern District of Virginia granted summary judgment in favor of the defendants on several claims, including those under the Racketeer Influenced and Corrupt Organizations (RICO) Act, fraud, unjust enrichment, and conversion, and partially on a civil conspiracy claim. The district court found that the company failed to establish the existence of a RICO enterprise, did not show injury to its business or property, and that equitable claims were precluded by the availability of legal remedies or the existence of contracts. The court also ruled that an attorney defendant could not be liable for conspiracy with his clients.The United States Court of Appeals for the Fourth Circuit reversed the district court’s summary judgment. The appellate court held that genuine disputes of material fact existed regarding the existence of a RICO enterprise, whether the company suffered financial harm, and the viability of the fraud, unjust enrichment, conversion, and civil conspiracy claims. The court clarified that the company was entitled to pursue legal and equitable remedies in the alternative and that the attorney’s potential liability for conspiracy could not be resolved on summary judgment. The case was remanded for further proceedings. View "Amazon.com, Inc. v. WDC Holdings LLC" on Justia Law