Fellowes Inc. v. Changzhou Xinrui Fellowes Office Equip. Co.
Court: U.S. 7th Circuit Court of Appeals
Docket: 12-3124 Opinion Date: July 22, 2014
Judge: Easterbrook
Areas of Law: Business Law, Civil Procedure, Contracts, International Trade
Fellowes filed a
breach-of-contract suit against Changzou Fellowes, a business
established in China, under the international diversity jurisdiction, 28
U.S.C. 1332(a)(2). Without discussing subject-matter jurisdiction, the
district court entered a preliminary injunction in favor of Fellowes,
despite the court’s assumption that Changzhou Fellowes had not been
served with process. The Seventh Circuit vacated, reasoning that
diversity jurisdiction is proper only if Changzhou Fellowes has its own
citizenship, independent of its investors or members. Deciding
whether a business enterprise based in a foreign nation should be
treated as a corporation for the purpose of section 1332 can be
difficult. Given the parties’ agreement that Changzhou Fellowes is
closer to a limited liability company than to any other business
structure in the U.S., it does not have its own citizenship and it does
have the Illinois citizenship of its member Hong Kong Fellowes, which
prevents litigation under the diversity jurisdiction.
United States v. Sheth
Court: U.S. 7th Circuit Court of Appeals
Docket: 13-2040 Opinion Date: July 18, 2014
Judge: Per curiam
Areas of Law: Civil Procedure, Professional Malpractice & Ethics, White Collar Crime
In 2009, Sheth, a
cardiologist, pled guilty to a single count of healthcare fraud, 18
U.S.C. 1347. As agreed by Sheth, the district court entered an order of
criminal forfeiture for cash and investment accounts then valued at $13
million plus real estate and a vehicle. The government represented that
the forfeited assets represented the proceeds of Sheth’s fraud,
calculated to be about $13 million. Sheth’s plea agreement specifies
that forfeited assets would be credited against the amount of
restitution, which the district court had determined to be $12,376,310.
In 2012, before the government had liquidated all of the forfeited
assets or disbursed any of the proceeds, it sought more of Sheth’s
assets to apply to restitution. Sheth objected. Without resolving the
factual dispute, the district court ordered turnover of the assets,
which were held by third parties. The Seventh Circuit vacated, holding
that the court erred by ordering turnover of the assets without first
allowing for discovery and holding an evidentiary hearing.
Spitz v. Proven Winners N. Am., LLC
Court: U.S. 7th Circuit Court of Appeals
Docket: 13-3084 Opinion Date: July 21, 2014
Judge: Kanne
Areas of Law: Contracts
Spitz, a freelance
copywriter, developed a plan to market “pet safe plants” to the
burgeoning pet supplies market. She pitched the idea to Amerinova, a
company that develops and licenses plant varieties. Although Amerinova
expressed interest, the project stalled. When Spitz discovered that
Proven Winners, a company partially owned by the owners of Amerinova,
had described some of its plants as “pet friendly” on its website and
plant tags, she sued Proven Winners and its owner, Euro. The district
court entered summary judgment in favor of Proven Winners and Euro. The
Seventh Circuit affirmed. Spitz did not identify any legal theory that
would make Proven Winners and Euro accountable for a contract allegedly
reached with Amerinova.
ABA Deadline: August 8, 2014.
Posts
