Litigation / Trial Practice – Page 11

Federal Court Vacated Gender Identity Portions of EEOC Harassment Guidance: Employer Uncertainty Remains

Takeaways

A federal court in Texas vacated the gender identity portions of the EEOC’s harassment guidance.
Uncertainty remains about issues like sex-designated restrooms and personal pronouns, but employers should continue to require employees to treat everyone with respect.
Employers also should consider carefully all accommodation requests and always engage in the interactive process.

Is An LLC’s Membership List A Trade Secret?

Yesterday’s post considered one of several matters raised on appeal in Perry v. Stuart, 2025 WL 1501935. The case involves a former member’s demand for inspection of records of a California limited liability company. Another issue raised in the appeal was whether the trial court erred in its finding that the LLC’s member list must be redacted prior to production because it is a trade secret.
The California Revised Uniform Limited Liability Company Act requires an LLC to keep, among other things, a current list of the full name and last known business or residence address of each member and of each transferee set forth in alphabetical order, together with the contribution and the share in profits and losses of each member and transferee. Cal. Corp. Code § 17701.13(d)(1). The RULLCA further provides that each member, manager, and transferee has the right, upon reasonable request, for purposes reasonably related to the interest of that person as a member, manager, or transferee, to inspect and copy during normal business hours any of the records required to be maintained pursuant to Section 17701.13. Cal. Corp. Code § 17704.10(b)(1).
The courts found that the membership list was a protectible trade secret, as defined under Section 3426.1 of the California Civil Code. Thus, the question was which code prevailed. The Court of Appeal concluded that the Civil Code took precedence as the more specific statute and thus the trial court had not erred in ordering the redaction of the membership list. The Court did not articulate why the Civil Code statute was more specific other than to note that trade secrets are a subset of business information. However, it is certainly arguable that membership list is an even smaller subset of business information and that the RULLCA provision is even more specific (i.e., detailing the exact information to be maintained) than the general Civil Code definition.

Plausibly Alleging Access Requires More Than Social Media Visibility

The US Court of Appeals for the Ninth Circuit affirmed a district court’s dismissal of a copyright action, finding that the plaintiff failed to plausibly allege either that the defendant had “access” to the work in question merely because it was posted on social media, or that the accused photos were substantially similar to any protectable elements of plaintiff’s photographs. Rodney Woodland v. Montero Lamar Hill, aka Lil Nas X, et al., Case No. 23-55418 (9th Cir. May 16, 2025) (Lee, Gould, Bennett, JJ.)
The dispute arose between Rodney Woodland, a freelance model and artist, and Montero Lamar Hill, also known as Lil Nas X, a well-known musical artist. Woodland alleged that Hill infringed on his copyright by posting photographs to his Instagram account that bore a striking resemblance to images Woodland had previously posted. Woodland claimed that the arrangement, styling, and overall visual composition of Hill’s photos closely mirrored his own, asserting that these similarities constituted unlawful copying of his original work.
Woodland’s original images had been publicly shared on his Instagram account, where he maintained a modest following. He did not allege any direct contact or interaction with Hill or his representatives, nor did he claim that Hill had acknowledged or referenced his work. Instead, Woodland’s claim rested on the contention that the similarities between the two sets of photographs were so substantial that copying could be inferred. In his complaint, Woodland asserted that Hill had access to his publicly posted images and that the degree of similarity supported a finding of unlawful copying. The district court dismissed the complaint, holding that Woodland failed to plausibly allege either access or substantial similarity. Woodland appealed.
The Ninth Circuit affirmed, agreeing with the district court that Woodland failed to satisfy the pleading standard necessary to survive a motion to dismiss. The Ninth Circuit explained that to state a viable claim for copyright infringement, a plaintiff must alleged both the fact of copying and the unlawful appropriation of protected expression. The Court found that Woodland failed to establish either element.
The Ninth Circuit considered two principal legal issues:

Whether Woodland sufficiently alleged that Hill had access to Woodland’s copyrighted works
Whether the photographs posted by Hill were substantially similar to Woodland’s photographs in their protectable elements under copyright law

On the issue of access, the Ninth Circuit found that the merely alleging availability of Woodland’s photos on Instagram did not, by itself, plausibly demonstrate that Hill had seen them. The Court noted that in the era of online platforms, “the concept of ‘access’ is increasingly diluted.” And while that might make it easier for plaintiffs to show “access,” there must be a showing that the defendants had a reasonable chance of seeing that work under the platform’s policies. The mere fact that Hill used Instagram and Woodland’s photos were available on the same platform raised only a “bare possibility” that Hill viewed the photos. Woodland had not plausibly alleged that Hill “followed, liked, or otherwise interacted” with Woodland’s posts or other similar accounts – the content merely being of a similar subgenre, even if true, was not sufficient. Without additional factual allegations suggesting that Hill had encountered Woodland’s work, the Court found that there was no reasonable basis to infer access.
Woodland also alleged that Hill copied 12 of Woodland’s photographs, characterizing the case as one of “serial infringement.” The Ninth Circuit rejected these allegations, finding that the number of allegedly copied images did not constitute direct evidence of access, nor was it dispositive of infringement. The Court noted that there was no precedent tilting the scale in Woodland’s favor based solely on the volume of alleged copying. Accordingly, the Court concluded that Woodland failed to plausibly allege a “reasonable possibility” that Hill had viewed his work.
On the issue of substantial similarity, the Ninth Circuit conducted a qualitative comparison of the two sets of photographs and found them lacking in protectable overlap. While both featured similar themes, such as styling, lighting, and pose, these elements were deemed either unoriginal or too general to warrant protection under copyright law. The Court emphasized that copyright does not extend to ideas, concepts, or unoriginal components such as generic backdrops, common poses, or standard photographic techniques. Furthermore, the Court found that the selection and arrangement of elements in the photographs was not sufficiently unique to establish a valid claim for infringement of elements protectable by copyright.

This Week in 340B: May 20 – 26, 2025

Find this week’s updates on 340B litigation to help you stay in the know on how 340B cases are developing across the country. Each week we comb through the dockets of more than 50 340B cases to provide you with a quick summary of relevant updates from the prior week in this industry-shaping body of litigation.
Issues at Stake: Contract Pharmacy; Other; Rebate Model

In four cases challenging Utah state law governing contract pharmacy arrangements, amici filed a motion for leave to file an amicus brief.
In one case challenging Nebraska state law governing contract pharmacy arrangements, the plaintiffs filed an opposition to an amicus curiae brief and an opposition to defendants’ motion to dismiss.
A trade association of drug manufacturers filed a complaint challenging a Tennessee state law governing contract pharmacy arrangements.
A drug manufacturer filed a complaint challenging a Utah state law governing contract pharmacy arrangements.
In an appealed case challenging a Louisiana law governing contract pharmacy arrangements, the court denied the intervenor-defendant’s motion for leave to file a sur-reply to appellant’s reply brief.
In a case by a covered entity against the government, the covered entity filed a motion for leave to file a response to the intervenors’ amicus brief.
In two cases against the government related to rebate models, the plaintiff filed an appeal to the circuit court.

Supreme Court Addresses Fraudulent Concealment and Indemnification in Post-Closing Dispute

The Delaware Supreme Court provides useful clarification regarding when a fraudulent concealment claim tolls the statute of limitations for indemnification claims, in LGM Holdings, LLC v. Gideon Schurder, et al., Del. Supr., No. 314, 2024 (April 22, 2025).
Background
In this post-closing dispute involving claims of intentional breach of representations and warranties in an acquisition agreement as well as fraudulent concealment, the court considered evidence of wrongdoing the sellers found after closing and in connection with an investigation by the FDA and the United States DOJ.
The post-closing investigation was the basis for claims that triggered indemnification. After the investigation, a separate letter agreement between the parties imposed caps on indemnification–but only for certain claims related to the government investigation.
Key Legal Principles
The high court explained that when contract interpretation is at issue, the trial court may not grant a motion to dismiss when there is more than one reasonable interpretation. See Slip op. at 16, 20-21.
The Supreme Court also instructed that when additional support for a key argument made at the trial level is presented for the first time on appeal, that additional support is not waived even if not presented to the trial court. Slip op. at 20.
The court addressed when fraudulent concealment will–or will not–toll the statute of limitations. The court’s analysis should be reviewed in its entirety but a few highlights include the following:

Under the doctrine of fraudulent concealment, the statute of limitations can be disregarded, like “stopping a clock,” when a defendant has fraudulently concealed from a plaintiff facts necessary to put the plaintiff on notice of the truth.
Specifically, a plaintiff must allege “an affirmative act of actual artifice” by the defendant that either prevented the plaintiff from being aware of material facts or led the plaintiff away from the truth. Slip op. at 22.
The statute of limitations begins to run when the plaintiff is objectively aware of the facts giving rise to the wrong, i.e., on inquiry notice. Slip op. at 23.
The tolling stops on the date the plaintiff was put on inquiry notice of the claim—if the plaintiff successfully proves fraudulent concealment. Slip at 25. The trial court erred when it instead held that the plaintiff was put on inquiry notice such that the plaintiff had sufficient time to file a claim. Id.
Partial disclosure of facts in a misleading or incomplete way can rise to the level of the requisite actual artifice. Slip op. at 26.

United States: Wiretaps in the Web Code? The Asset Management Pixel Litigation Explained

Earlier this month, two investors filed a putative class action challenging the deployment of third-party tracking tools—including the Meta Pixel, LinkedIn Insight Tag, and Google Analytics—on the website and mobile app of a major asset management firm.
Similar to previous class action litigation in healthcare, retail, and other industries, this lawsuit claims that these tools are deployed without user consent, in violation of state anti-wiretapping statutes (such as the California Invasion of Privacy Act) and the federal Wiretap Act.
The plaintiffs allege that the tools at issue captured real-time account logins, trade instructions, fund tickers, and search queries, and then funneled that data—paired with unique identifiers—to the third-party platforms for advertising and analytics. The complaint seeks certification of nationwide and statewide classes, along with aggregated, classwide damages for each purported statutory violation.
The case is in its early stages, and the asserted claims appear vulnerable to multiple challenges—both on the merits and at class certification—including the lack of common classwide injury, and the likelihood of user consent via applicable privacy policies. In the meantime, asset management and investment firms with similar online properties may wish to consider the following steps:

Inventory every tag. Identify all third-party scripts that load, particularly behind authenticated investor pages.
Pause sensitive flows. Disable any code that transmits account or transaction data until consent and data-minimization strategies are assessed and validated.
Update notices and banners. Review disclosures to site users— especially as part of annual privacy evaluations.

Pixels and similar tools that once seemed like innocuous adjuncts to online marketing may present significant class action risk if not properly analyzed and deployed. If your digital stack includes social media driven analytics, now is the time to audit, remediate, and evaluate disclosures

Arbitration Rights Are Not Indestructible: Appellate Division Finds Waiver Based on Litigation Conduct

Arbitration provisions are a cornerstone of dispute-resolution strategy. As the Appellate Division recently made clear in Hopkins v. LVNV Funding, LLC, however, the right to arbitrate is not self-executing—and can be forfeited through strategic delay or active participation in litigation. A party that eschews arbitration in favor of judicial process may find those rights extinguished when invoked later. The decision demonstrates that arbitration rights are preserved not merely by contract but by conduct consistent with their enforcement. Put simply, a contractual right to arbitrate means little if a party’s litigation conduct signals abandonment rather than preservation.
In response to LVNV Funding, LLC’s (“LVNV”) complaint alleging that it had defaulted on its account with Credit One Bank, N.A., incurring $746.71 in debt, Randy Hopkins (“Hopkins”) filed an answer and “class action counterclaim” in May 2022 against several LVNV-affiliated debt purchasers and collectors (“Defendants”). Hopkins v. LVNV Funding, LLC, 481 N.J. Super. 49, 56 (App. Div. 2025). Hopkins alleged that Defendants violated the New Jersey Consumer Finance Licensing Act and the Consumer Fraud Act by attempting to collect consumer debts without the requisite state licenses. Id. at 57. Though represented by counsel, Defendants waited almost sixteen months before moving to compel arbitration. Id. at 64. During that time, they filed a motion to dismiss which the trial court granted in part, resulting in the dismissal of Hopkins’s unjust enrichment claim. Id. at 58. When Defendants ultimately filed an answer to Hopkins’s remaining claims, not only had they failed to assert arbitration as an affirmative defense, id. at 65, but their Rule 4:5-1(b)(2) certifications expressly disclaimed any pending or contemplated arbitration, id. at 58.
Only after Hopkins moved to compel their long-overdue discovery responses, did Defendants finally invoke the arbitration clause and move to compel arbitration. Id. at 59. The trial court granted the motion to compel arbitration, reasoning that the parties had not engaged in sufficiently “prolonged litigation” to support a finding of waiver. Id. In doing so, however, the court focused primarily on the passage of time. It gave little weight to Defendants’ litigation conduct, including their earlier motion to dismiss, omission of arbitration from their pleadings, and affirmative disclaimer of arbitration in the Rule 4:5-1 certifications accompanying the pleadings. Ibid. The Appellate Division reversed and remanded, holding that the trial court failed to conduct the totality-of-the-circumstances analysis required under Cole v. Jersey City Medical Center, 215 N.J. 265, 280–81 (2013). Hopkins, 481 N.J. Super. at 59.
Applying Cole, the Appellate Division considered seven non-exclusive factors to determine whether Defendants had waived their right to arbitrate. These include:
(1) the delay in making the arbitration request; (2) the filing of any motions, particularly dispositive motions, and their outcomes; (3) whether the delay in seeking arbitration was part of the party’s litigation strategy; (4) the extent of discovery conducted; (5) whether the party raised the arbitration issue in its pleadings, particularly as an affirmative defense, or provided other notification of its intent to seek arbitration; (6) the proximity of the date on which the party sought arbitration to the date of trial; and (7) the resulting prejudice suffered by the other party, if any.[Cole, 215 N.J. at 280-81.]

In analyzing all of the above factors, the court first found that the delay was substantial. Defendants waited nearly sixteen months to raise arbitration, a period the appellate court found particularly unreasonable given that they were represented by counsel and had actively litigated the case. Hopkins, 481 N.J. Super. at 64. Second, the motion practice supported waiver. Defendants filed a dispositive motion to dismiss and secured dismissal of a claim, which signaled submission to the trial court’s adjudicative authority. Ibid. Third, the appellate court found the timing of the arbitration demand to be strategic, noting that Defendants sought arbitration only after gaining partial dismissal and when discovery pressure mounted. Ibid. Fourth, although Defendants had not served discovery, they failed to respond to Hopkins’s discovery requests and filed for arbitration two days after Hopkins moved to compel those responses. Id. at 64-65. Fifth, Defendants’ failure to raise arbitration in their pleadings—combined with express representations in their Rule 4:5-1(b)(2) certifications that no arbitration was pending or contemplated—weighed heavily in favor of a finding of waiver. Id. at 65. Sixth, the proximity to trial weighed against a finding of waiver, as no trial date had been set. Ibid. Seventh, the appellate court found prejudice based on Hopkins’s investment of time and resources in litigating the matter and the fact that a claim (unjust enrichment) had already been dismissed through motion practice. Id. at 66. The Appellate Division concluded that considering the totality of the circumstances, Defendants’ conduct was inconsistent with the right and that the “purported right” had therefore been waived. Ibid.
Hopkins reinforces the importance of asserting arbitration rights early, clearly, and consistently. Parties wishing to preserve arbitration should assert their right to the dispute resolution mechanism at the outset of litigation—typically in a pre-answer motion to dismiss and to compel arbitration or in an answer. If that motion is denied, it is subject to immediate appellate review pursuant Rule 2:2-3, which treats such orders as final for appeal purposes.
If an answer is filed, the Rule 4:5-1(b)(2) certification must invoke the possibility of arbitration. Disclaiming any pending or contemplated arbitration in a Rule 4:5-1(b)(2) certification can later be used as evidence of waiver. Although attorneys often treat this certification as routine, Hopkins serves as a reminder that courts will hold parties to the representations made pursuant to Rule 4:5-1—especially where subsequent conduct reinforces the appearance that arbitration is off the table. The Appellate Division also emphasized that Rule 4:5-1 certifications carry a continuing obligation to amend if arbitration later becomes a viable or intended course of action. Id. at 65. A failure to amend the certification in a timely manner—especially when coupled with dispositive motion practice, participation in discovery, or delay until adverse rulings loom—can weigh heavily in a court’s waiver analysis.
To avoid these pitfalls, attorneys should flag and assess arbitration provisions at the outset of a case. Strategic inconsistency is risky and may result in the permanent forfeiture of a bargained-for right. Ultimately, Hopkins sends a cautionary message to all litigants who intend to rely on arbitration clauses—whether in low-stakes consumer matters or complex commercial disputes: courts will enforce such provisions only when parties treat arbitration as a right to be proactively preserved, not casually presumed.

China’s Supreme People’s Court Designates Record-Setting Trade Secret Case as a Typical Case

On May 26, 2025, China’s Supreme People’s Court (SPC) released the “Typical cases on the fifth anniversary of the promulgation of the Civil Code” (民法典颁布五周年典型案例) including one intellectual property case – the record-setting 640 million RMB trade secret case of June 2024. While the decision was a hollow victory as the defendant is insolvent and has not paid any damages, designation as a typical case may encourage lower courts to award higher damages in future trade secret cases. While the parties are unnamed, the plaintiff is Geely Holding Group and the defendant is WM Motor.
As explained by the SPC:
III. “Strict protection” and “high compensation” to actively create an environment that encourages innovation – Ji XX Company et al. v. Wei XX Company et al. Case of infringement of technical secrets
1. Basic Facts of the Case
Nearly 40 senior managers and technical personnel of Ji XX Company and its affiliated companies resigned and went to work for Wei XX Company and its affiliated companies, of which 30 joined the company immediately after resigning in 2016. In 2018, Ji Co. discovered that Wei Co. and the two companies used some of the above-mentioned resigned personnel as inventors or co-inventors, and applied for 12 patents using the new energy vehicle chassis application technology and 12 sets of chassis parts drawings and technical information carried by digital models (hereinafter referred to as “the technical secrets involved in the case”) that hey learned from their prior employer. In addition, the Wei EX series electric vehicles launched by Wei Co. were suspected of infringing the technical secrets involved in the case. Ji Co. filed a lawsuit with the first instance court, requesting that Wei Co. be ordered to stop the infringement and compensate for economic losses and reasonable expenses totaling 2.1 billion RMB.
2. Judgment Result
The effective judgment held that this case was an infringement of technical secrets caused by the organized and planned use of improper means to poach technical personnel and technical resources of new energy vehicles on a large scale. Through overall analysis and comprehensive judgment, Wei Co. obtained all the technical secrets involved in the case by improper means, illegally disclosed part of the technical secrets involved in the case by applying for patents, and used all the technical secrets involved in the case. Therefore, the judgment is: unless the consent of Ji Co. is obtained, Wei Co. shall stop disclosing, using, or allowing others to use the technical secrets involved in the case in any way, and shall not implement, permit others to implement, transfer, pledge, or otherwise dispose of the 12 patents involved in the case; all drawings, digital models, and other technical materials containing the technical secrets involved in the case shall be destroyed or handed over to Ji Co.; the judgment and the requirements for stopping infringement shall be notified to Wei Co. and all its employees, affiliated companies, and relevant component suppliers by means of announcements, internal company notices, etc., and the relevant personnel and units shall be required to sign a letter of commitment to maintain secrecy and not infringe, etc.; considering that Wei Co. has obvious intention to infringe, the circumstances of infringement are serious, and the consequences of infringement are serious, double punitive damages shall be applied to Wei Co.’s infringement profits from May 2019 to the first quarter of 2022, and Wei Co. shall compensate Ji Co. for economic losses and reasonable expenses of about 640 million RMB. At the same time, it is made clear that if Wei Co. violates the obligation to stop infringement determined by the judgment, it shall pay the late performance fee on a daily basis or in one lump sum.
3. Typical significance
General Secretary Xi Jinping profoundly pointed out that protecting intellectual property rights is protecting innovation. Strengthening judicial protection of intellectual property rights is an inherent requirement and important guarantee for the development of new quality productivity. In this case, the People’s Court, in accordance with the relevant provisions of the Civil Code, based on the determination of infringement of technical secrets, while applying punitive damages in accordance with the law, also actively explored the specific way to bear civil liability for stopping infringement and the calculation standard of delayed performance of non-monetary payment obligations, which promoted the renewal of intellectual property trial concepts and innovation of judgment rules, fully demonstrated the clear attitude of strictly protecting intellectual property rights and the firm stance of punishing unfair competition, and was conducive to creating a legal business environment of honest operation, fair competition, and innovation incentives.
4. Guidance on the provisions of the Civil Code
Article 179 The main forms of civil liability include:
(1) cessation of the infringement;
(2) removal of the nuisance;
(3) elimination of the danger;
(4) restitution;
(5) restoration;
(6) repair, redoing, or replacement;
(7) continuance of performance;
(8) compensation for losses;
(9) payment of liquidated damages;
(10) elimination of adverse effects and rehabilitation of reputation; and
(11) extension of apologies.
Where punitive damages are available as provided by law, such provisions shall be followed.
The forms of civil liability provided in this Article may be applied separately or concurrently.
Article 1168: Where two or more persons jointly commit an infringement and cause damage to others, they shall bear joint and several liability.

The original text, including four other Civil Code Typical Cases, can be found here (Chinese only).

EXPENSIVE LOSS: #BigLaw Firms Charge Volkswagen Over $2.2MM in Fees and Costs– Settle TCPA Class Action For $275,000 Individually Anyway (GROSS!)

For anyone wondering what the cost of TCPA class action defense looks like when you retain #biglaw, buckle up because I have a fantastic story for you.
A while back a guy named Brian Trenz sued Volkswagen in a TCPA class action.
The suit apparently arose out of the actions of some companies called On-Line Administrators, Inc. dba Peak Performance Marketing Solutions, On-Line Administrators, LLC, and Affinitiv, Inc–at least they ended up owing VW indemnity, but we will get to that.
So VW goes off and hires two large firms to defend it. Faegre and Baker Hostetler.
Now if you’re a TCPAWorld reader you already know that was a mistake. But how big of a mistake? Let’s find out.
Well after litigating the case for years the big law firms finally got the case settled for $275,000.00 on an individual basis.
Eesh.
So many opinions on that.
But it gets so much worse.
These two lovely law firms apparently billed Volkswagen–wait or it– $2,245,305.62 in attorneys fees to defend the suit.
Over $2.2MM to defend a TCPA class action suit folks.
Now, as mentioned, the Peak defendants were apparently on the hook for indemnity. So after the case settled–and all those fees were paid to defend the suit– VW turned around and hired more lawyers to sue Peak to recover the $2.2MM.
Here’s where things get REALLY interesting.
In order to recover its fees, the Defendant needed to demonstrate the demanded fees were reasonable.
The Peak defendants hired an expert to look at the #biglaw billing entries and–surprise surprise– the expert found the billing to be wildly inefficient, duplicative, and just flat unreasonable.
Yeah, nobody surprised there.
Nonetheless the court determined the $2MM+ charged by #biglaw was actually mostly reasonable!
In Volkswagen Group v. On-Line Administrators 2025 WL 1503120 (C.D. Cal May 27, 2025) the court essentially determined paying two law firms over $2MM in fees is actually pretty smart considering that the TCPA class action had over $2BB in potential liability.
The Court’s reasoning was essentially the amount #biglaw spent on the stuff it did was not too high– but the Court (and Peak’s expert) missed that the stuff it did SHOULD NEVER HAVE BEEN DONE had the case been litigated properly.
Ironically, therefore, Peak screwed up by retaining an expert to review the BILLING practices of #biglaw as opposed to the LITIGTION practices.
For instance, had the case been competently handled in my view it would never have been certified. And a million in fees could have been avoided easily. But… whatever.
The Court did find some of #biglaws billing practice to be unacceptable, but only trimmed the fees by a moderate ~7%. So Volkswagen was entitled to recover just over $2MM in fees although it had to take a bit of a haircut.
In terms of the settlement itself, the Court determined “Volkswagen’s $275,000 settlement was reasonable and is recoverable in full.”
Think about that.
A guy gets a few phone calls and settles his case INDIVIDUALLY for $275,000.00 because the defendant hired #biglaw.
THIS is why TCPA class actions have doubled year-over-year. THIS is why TCPA class actions are overrunning our courts. THIS is why small businesses are getting hit with shake down lawsuits daily.
Get sued in a TCPA class action– thank #biglaw.
By comparison, Troutman Amin, LLP handles multi-billion dollar exposure TCPA class litigation in federal court EVERY SINGLE DAY. While I cannot reveal settlement amounts it is public record that we do CLASS settlements in the $275,000.00 range– not individual settlements.
Our results CRUSH those like happen here and we NEVER spend millions to defend a single TCPA suit. Absolutely nuts.
If you want to waste millions in fees and LOSE, by all means hire #biglaw.
If you want to get better results for way less money, hire the guys who actually know what the hell they’re doing.
But at the end of the day Volkswagen won, sort of.
Sure it had to eat millions of dollars in fees and have its settlement publicly disclosed but now it has spent some unknown amount of additional money to obtain a judgment against the Peak defendants who will now probably try to negotiate the settlement down or just declare bankruptcy and not pay it.
And that leads to the ultimate take aways here:

Be INCREDIBLY careful with who you work with for outbound calling or lead generation. Just because someone gives you an indemnity agreement does not mean it is worth the paper it is printed on– and even if it is you may still have to defend resulting TCPA lawsuit all the way to judgment.
Be INCREDIBLY careful about who you retain to defend you in TCPA class litigation. This is literally a multi-million dollar decision and it DOES matter. Many people don’t know that #biglaw attorneys will try to sell you to work with their partners while taking secret kick backs they don’t tell you about. Totally unethical but it happens all the time.
The exposure in these cases is wild. And companies will pay hundreds of thousands of dollars to settle these suits individually just to get out from under #biglaw’s bills. This, of course, just incentivizes more lawsuits. But that’s the way it goes.

Trade Secret Law Evolution- Episode 77: Establishing Irreparable Harm and Likelihood of Success [Podcast]

In this episode, Jordan breaks down a recent ruling from the Northern District of New York that addresses what to do and not to do to establish the elements of irreparable harm and likelihood of success for a motion to enjoin trade secret misappropriation.

Better Late Than Never? Not in the 5th Circuit: Delayed Action on Accommodation May Be ADA Violation

Earlier this month, in Strife v. Aldine Independent School District, the Fifth Circuit Court of Appeals held that an employer’s delayed accommodation of an employee’s disability could amount to a failure to accommodate under the Americans with Disabilities Act. This case serves as an important reminder not only to take all requests for disability accommodations seriously but also to respond swiftly and without undue delay.
ADA Basics
Under the ADA, employers cannot discriminate against employees based on their disabilities. In addition, employers must accommodate known disabilities, if requested. The employer does not have to give the exact requested accommodation, but they must engage in the “interactive process,” through which the employer and employee work together to find a reasonable accommodation that will both enable the employee to perform the essential job functions and work for the employer’s business needs. The duty to engage in the interactive process begins when the employer is on notice of the employee’s disability and desire for an accommodation.
The Facts
Alisha Strife requested that her employer, the Aldine Independent School District, allow her service dog to accompany her at work, in connection with her multiple disabilities. The school requested additional information, and Strife submitted a letter from her treating provider. The school, however, deemed the letter insufficient because it was not from a board-certified medical provider and requested further supporting documentation. Strife then submitted a letter from her psychiatrist, after which the school requested that she submit to an independent medical examination.
After the examination, the school and Strife’s lawyer exchanged various communications, and Strife provided three additional letters and underwent another exam confirming her need for the service dog. The school took issue with these items, including stating that they failed to “provide any information regarding potential alternative accommodations.” After roughly six months, the school ultimately granted the request.
Strife filed suit alleging, in part, that the school failed to accommodate her disabilities, and the school moved to dismiss. The court granted the motion to dismiss as to the failure to accommodate claim and a hostile work environment claim and later granted summary judgment on other ADA claims. On appeal, however, the Fifth Circuit reversed the dismissal of the failure to accommodate claim (but affirmed the district court’s treatment of the other claims).
The Holding
The Fifth Circuit held that Strife plausibly stated a claim for failure to accommodate, even though the school ultimately granted her requested accommodation. The court defined the question as “whether th[e] six-month delay, in and of itself, constitutes a failure to accommodate.” While noting that employers are not required to move “with maximum speed,” the court held that a delay can constitute a failure to accommodate because, “otherwise, an employer could circumvent the ADA’s protections by forcing an aggrieved employee to endure an endless interactive process.”
Under these facts, the court held that the delay could constitute a failure to accommodate. Specifically, the court noted that the school’s actions indicated a lack of good faith, as Strife repeatedly provided documents confirming her need for the accommodation, the accommodation was granted only after she initiated legal action, and the delay forced her to work in “suboptimal conditions” for six months.
Takeaways
This case serves as an important reminder to move expeditiously on accommodation requests. While you do not need to rush into a decision or simply grant an employee’s exact request as soon as it comes in, remember to engage in the interactive process in good faith and without undue delay. As always, consult with your employment lawyer with any questions about best practices in the interactive process. As for Ms. Strife’s case, the Fifth Circuit held that she had plausibly alleged a failure to accommodate due to the six-month delay and that her claim should go forward. Time will tell whether she will succeed on this claim.
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Court Rules On Personal Jurisdiction In A Trust Dispute, Holding That In Rem Jurisdiction Still Requires Personal Contacts With A Defendant, But Otherwise Affirming The Trial Court’s Denial Of An Objection To Personal Jurisdiction

In Hooten v. Collins, a dispute arose between the trustee of a Texas trust and a beneficiary who resided overseas regarding the distribution of trust assets, which primarily consisted of real estate in Texas. No. 08-23-00327-CV, 2024 Tex. App. LEXIS 6805 (Tex. App.—El Paso September 16, 2024, no pet.). The trustee filed suit for instructions in Texas regarding approval of a distribution plan and discharge relief. The beneficiary shortly thereafter filed suit in California for breach of fiduciary duty based on the same set of facts. The beneficiary then objected to the Texas court’s jurisdiction based on an alleged lack of personal jurisdiction. After discovery, the trial court held a hearing and denied the objection, and the beneficiary appealed. The court of appeals affirmed the denial of the objection.
The first issue was whether the trial court had in rem jurisdiction over the beneficiary due to the trust assets residing in Texas. The court held that even in in rem jurisdiction, a court must still have in personam jurisdiction over a defendant:
More than a century ago, the U.S. Supreme Court distinguished between in personam and in rem jurisdiction for state-court jurisdictional inquiries. Pennoyer v. Neff, 95 U.S.714, 24 L. Ed. 565 (1877). As later explained in Shaffer v. Heitner, 433 U.S. 186, 189, 97 S. Ct. 2569, 53 L. Ed. 2d 683 (1977):

If a court’s jurisdiction is based on its authority over the defendant’s person, the action and judgment are denominated “in personam” and can impose a personal obligation on the defendant in favor of the plaintiff. If jurisdiction is based on the court’s power over property within its territory, the action is called “in rem” or “quasi in rem.”

Id. at 199. Consequently, the jurisdictional analysis following Pennoyer centered on the physical—and in some cases constructive—presence of people and things within the forum state. Id. at 201-03. Texas courts acknowledge the same distinction: “The general rule of in rem jurisdiction is that the court’s jurisdiction is dependent on the court’s control over the defendant res.” Costello v. State, 774 S.W.2d 722, 723 (Tex. App.—Corpus Christi 1989, writ denied). “[A]n in rem action affects the interests of all persons in the world in the thing,” but an in rem judgment’s effect is limited only “to the property that supports jurisdiction.” Bodine v. Webb, 992 S.W.2d 672, 676 (Tex. App.—Austin 1999, pet. denied). For that reason, the “court need not acquire jurisdiction over the person.” City of Conroe, 602 S.W.3d at 457-58 (citing Batjer v. Roberts, 148 S.W. 841, 842 (Tex. App.—El Paso 1912, writ ref’d)) (observing that service of process in in rem suits may be constructive, and persons with interest in rem may never know of suit).

Robert argues that this is not a true in rem action because it is not a suit against the property. We agree that the claim here would be better described as quasi in rem:
A quasi in rem proceeding is an action between parties where the object is to reach and dispose of property owned by them or of some interest therein. While an in rem action affects the interests of all persons in the world in the thing, a quasi in rem action affects only the interests of particular persons in the thing.
Bodine, 992 S.W.2d at 676 (internal citations omitted); see also Hanson v. Denckla, 357 U.S. 235, 246 n.12, 78 S. Ct. 1228, 2 L. Ed. 2d 1283 (1958) (“A judgement quasi in rem affects the interest of particular persons in designated property.”).
Drawing on these principles, Marsha contends that the court need not have in personam jurisdiction over Robert because Texas has in rem jurisdiction over the trust property. Robert disagrees with Marsha’s characterization of the claims and argues that, even if the location of property provides part of the alleged jurisdictional basis, a Texas court must still have in personam jurisdiction over him. In this respect, we agree with Robert that developments since Pennoyer have cemented due process protections into both in personam and in rem jurisdictional inquiries.

In Shaffer v. Heitner, the Court was asked to decide whether the seizure of property in the forum state could justify a court’s exercise of jurisdiction over nonresident defendants in a suit unrelated to the ownership of that property. Shaffer, 433 U.S. at 189. The Court traced the constitutional doctrine of state-court jurisdiction to Pennoyer v. Neff. See Shaffer, 433 U.S. at 196. But the Schaffer Court recognized the watershed change occasioned by International Shoe. Id. at 203 (citing Int’l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S. Ct. 154, 90 L. Ed. 95 (1945)). After International Shoe, the focus of the personal jurisdictional inquiry changed from a state’s sovereignty over persons within its border to the “relationship among the defendant, the forum, and the litigation.” Id. at 204.

The Shaffer Court then reasoned that an assertion of jurisdiction over property is equivalent to an assertion of jurisdiction over a person’s interest in that property. It dispensed with the theoretical distinction between in rem and in personam jurisdiction and concluded that all assertions of personal jurisdiction — whether based on property ownership (i.e., “in rem” or “quasi in rem”) or personal contacts with the forum (i.e., “in personam”) — are to be measured against the minimum-contacts and fairness prongs of the International Shoe test. Id. at 212 (“We therefore conclude that all assertions of state-court jurisdiction must be evaluated according to the standards set forth in International Shoe and its progeny.”).

Several Texas courts have resolved challenges to personal jurisdiction in trust litigation where the trust res included Texas real property; each conducted a thorough minimum-contacts tests analyzing the defendant’s contacts with the state. See Johnson v. Kindred, 285 S.W.3d 895, 899 (Tex. App.—Dallas 2009, no pet.); Alexander v. Marshall, No. 14-18-00425-CV, 2021 Tex. App. LEXIS 1952, 2021 WL 970760, at *5 (Tex. App.—Houston [14th Dist.] Mar. 16, 2021, pet. denied) (mem. op.); JPMorgan Chase Bank, N.A. v. Campbell, No. 09-20-00161-CV, 2021 Tex. App. LEXIS 5001, 2021 WL 2583573, at *5 (Tex. App.—Beaumont June 24, 2021, no pet.) (mem. op.). Similarly, we must determine whether Texas has personal jurisdiction over Robert based on a detailed analysis of his alleged forum contacts and the relationship between those Texas contacts and the litigation. See Dawson-Austin v. Austin, 968 S.W.2d 319, 327 (Tex. 1998) (conducting a minimum-contacts analysis in a divorce case relating to the distribution of Texas property that was part of the marital estate); see also Smith v. Lanier, 998 S.W.2d 324, 333 (Tex. App.—Austin 1999, pet. denied) (conducting separate minimum-contacts analyses to determine the character of an estate’s property—i.e., separate or community—and to determine the propriety of jurisdiction over the nonresident representative of the deceased’s estate in her individual capacity).

Id.
The court then discussed personal jurisdiction standards:
The Texas long-arm statute extends a Texas court’s personal jurisdiction “as far as the federal constitutional requirements of due process will permit,” but no further. Thus, the contours of federal due process guide our decision.
Federal due process limits a court’s jurisdiction over nonresident defendants unless: (1) the defendant has established minimum contacts with the forum state; and (2) the exercise of jurisdiction comports with traditional notions of fair play and substantial justice. “As a general rule, the exercise of judicial power is not lawful unless the defendant ‘purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.’” Due process requires purposeful availment because personal jurisdiction “is premised on notions of implied consent—that by invoking the benefits and protections of a forum’s laws, a nonresident consents to suit there.” Purposeful availment includes deliberately engaging in significant activities within a state or creating continuing obligations with residents of the forum. It includes seeking profit, benefits, or advantage from the forum. It excludes, however, “random,” “fortuitous,” or “attenuated” contacts or the “unilateral activity of another party or a third person.” Moreover, a party may purposefully avoid a particular forum by structuring its transactions in such a way as to neither profit from the forum’s laws nor subject itself to jurisdiction there.

A plaintiff asserting that a court has specific jurisdiction over a nonresident defendant must also show that its claim arises out of, or relates to, the defendant’s contacts with the forum. Under the Texas application of that requirement, “for a nonresident defendant’s forum contacts to support an exercise of specific jurisdiction, there must be a substantial connection between those contacts and the operative facts of the litigation.” Specific jurisdiction is not as exacting as general jurisdiction in that the contacts may be more sporadic or isolated so long as the cause of action arises out of those contacts.

Id. (internal citations omitted). The court held that there was sufficient evidence to support the trial court’s exercise of personal jurisdiction over the beneficiary:
First, we acknowledge the significant role that the Texas properties play in this dispute. When it established International Shoe as the standard for all assertions of jurisdiction for in rem actions, the United States Supreme Court in Shaffer v. Heitner observed the following:

[T]he presence of property in a State may bear on the existence of jurisdiction by providing contacts among the forum State, the defendant, and the litigation. For example, when claims to the property itself are the source of the underlying controversy between the plaintiff and the defendant, it would be unusual for the State where the property is located not to have jurisdiction. In such cases, the defendant’s claim to property located in the State would normally indicate that he expected to benefit from the State’s protection of his interest.

Shaffer, 433 U.S. at 207. The Court specifically noted the interest of a forum in “the marketability of property within its borders,” “providing a procedure for peaceful resolution of disputes about the possession of that property” and the reality that “important records and witnesses will be found in the State.” Id. at 208.
The Court’s observation rings particularly true here. This trust had 21 Texas income-producing properties. Their aggregate value was in the tens of millions of dollars. The properties required the services of a property management firm to collect rents, undertake maintenance, and handle the day-to-day tasks inherent with commercial real estate. Because Robert wanted to be involved in their disposition, he asked to receive an ongoing stream of information for the properties. The income generated by the properties further required accounting advice for quarterly tax obligations, here provided to Robert by a Texas CPA. And when many of the properties were sold (at Robert’s urging), the beneficiaries only enjoyed the fruits of those sales under the benefits and protection of Texas law.
To be sure, Robert’s ownership interest in Texas property was only equitable and resulted from decisions made by the settlors and trustees. Which brings us to Robert’s core argument: as a passive trust beneficiary, he cannot be deemed to have contacts in a jurisdiction where the trust happens to own property. Owning an equitable interest in the trust property alone is insufficient to confer jurisdiction when an interested person assumes only a passive role in the trust’s administration. Johnson, 285 S.W.3d at 903 (finding no jurisdiction over passive beneficiary of trust).

…
Yet when interested parties take an active role in the trust’s affairs with the knowledge that their actions will create continuing obligations towards Texas residents, those parties are subject to personal jurisdiction in Texas… Here, Marsha’s evidence is legally sufficient to show that Robert assumed an active role in managing the trust’s assets. For example, for 18 months, Robert kept in continuous communication with the trust’s Texas-based property manager, Investar, and the trust’s tax advisor, J.M. Trippon & Co., receiving information about the financial health of the Texas trust assets. Robert attended two in-person meetings in Texas to discuss the trust’s administration, analyze its assets, and make additional requests for information from the trust’s Texas-based professionals. While Robert minimizes the Texas visit by arguing his primary purpose was to attend his father’s funeral, that explanation does nothing to refute the fact that he purposefully engaged in these contacts in Texas.
More importantly, Robert attempted to insert himself into the trust’s management such that there is some evidence he was more than a passive beneficiary… The trial court could have fairly considered how Robert’s requests had some influence over the plans to distribute the trust… Collectively, these contacts are legally sufficient to show Robert purposefully availed himself of the Texas forum: he inserted himself in the distribution plans of Trust B’s property to obtain a benefit, advantage, or profit from transactions or conveyances of Texas real estate. For the above reasons, we find the evidence is legally sufficient to confer jurisdiction over Robert.

Id. The court also held that there was a sufficient connection between the defendant, the forum, and the litigation:
This case arises out of the parties’ inability to agree on a plan to realize an appropriate and equitable distribution of a trust’s Texas property. Robert sought to influence the sale and distribution of Texas assets to beneficiaries of the trust. Additionally, Robert’s demands and criticism of Marsha’s performance as trustee are tied to the declaratory relief that Marsha now seeks. He accused Marsha of ignoring his interests and withholding information. Accordingly, some claims for declaratory relief enumerated in Marsha’s petition are a request for the court to approve her actions as trustee and an accounting of the trust.

Id. The court finally found that the exercise of jurisdiction was consistent with fair play and substantial justice and affirmed the order denying the defendant’s objection to the Texas court’s jurisdiction over him.
Interesting Note: When there are trust disputes, finding a forum or state to determine those disputes can be a very important factor in resolving them. One issue that can be confounding is filing suit in a state and a trustee or beneficiary objecting the jurisdiction’s personal jurisdiction. The Model Trust Code has a provision that expressly discusses personal jurisdiction in trust disputes. Unform Trust Code Section 202 is entitled: “Jurisdiction Over Trustee And Beneficiary,” and it states:
(a) By accepting the trusteeship of a trust having its principal place of administration in this State or by moving the principal place of administration to this State, the trustee submits personally to the jurisdiction of the courts of this State regarding any matter involving the trust.
(b) With respect to their interests in the trust, the beneficiaries of a trust having its principal place of administration in this State are subject to the jurisdiction of the courts of this State regarding any matter involving the trust. By accepting a distribution from such a trust, the recipient submits personally to the jurisdiction of the courts of this State regarding any matter involving the trust.
(c) This section does not preclude other methods of obtaining jurisdiction over a trustee, beneficiary, or other person receiving property from the trust.

The comments to the Uniform Trust Code Provision state:
The jurisdiction conferred over the trustee and beneficiaries by this section does not preclude jurisdiction by courts elsewhere on some other basis. Furthermore, the fact that the courts in a new State acquire jurisdiction under this section following a change in a trust’s principal place of administration does not necessarily mean that the courts of the former principal place of administration lose jurisdiction, particularly as to matters involving events occurring prior to the transfer. The jurisdiction conferred by this section is limited. Pursuant to subsection (b), until a distribution is made, jurisdiction over a beneficiary is limited to the beneficiary’s interests in the trust. Personal jurisdiction over a beneficiary is conferred only upon the making of a distribution. Subsection (b) also gives the court jurisdiction over other recipients of distributions. This would include individuals who receive distributions in the mistaken belief they are beneficiaries.

Under the Hooten opinion, Texas courts will lose jurisdiction to other states, who may have less of a connection to the administration of trusts, solely because of Texas’s common-law jurisdictional precedent. Other states do not require the same contacts analysis for in rem or quasi in rem jurisdiction. So, at this point, a trustee of a Texas Trust may not be able to get jurisdiction for trust disputes in Texas if there are beneficiaries who do not take an active role in trust management and live in another state. That fact does not deprive a Texas court of jurisdiction. Further, potentially, a Texas court can appoint a guardian ad litem or attorney ad litem to represent absent beneficiaries. Legislature needs to address this important issue.