Jurisdictional Boundaries of the Federal Circuit in ITC-Related Matters Are Limited
In Realtek Semiconductor Corporation v. ITC (23-1187), the Federal Circuit concluded that it lacked jurisdiction to decide whether the International Trade Commission (ITC) correctly denied Realtek’s motion for sanctions against Future Link Systems, LLC because the ITC decision did not involve a final determination affecting the entry of articles. As a result, the panel did not address the merits of Realtek’s appeal.
Background
In 2019, Future Link entered into a license agreement with MediaTek, Inc., which stipulated a lump sum payment if Future Link filed a lawsuit against Realtek. After filing a complaint with the ITC accusing Realtek of patent infringement, Future Link subsequently settled with a third party and told Realtek that the settlement resolved the underlying investigation. Realtek filed a motion for sanctions alleging that the agreement between Future Link and MediaTek was improper.
Despite expressing concern about the agreement between Future Link and MediaTek, the administrative law judge (ALJ) denied the sanctions motion on the basis that the agreement did not influence Future Link’s decision to file the complaint. Future Link then withdrew its complaint, and the investigation was successfully terminated. As such, there was no final determination on the merits by the Commission.
Once the ITC adopted the ALJ’s order, Realtek appealed the denial of the sanctions motion to the Federal Circuit.
Jurisdictional Analysis
The Federal Circuit’s jurisdiction to hear appeals from the ITC is governed by 28 U.S.C. § 1295(a)(6), which allows for the review of final determinations under 19 U.S.C. § 1337.
On appeal, Realtek was not able to persuade the panel that the ITC’s denial of the sanctions motion was a final determination within Section 1295(a)(6). Rather, the panel explained that Realtek’s position misconstrued Federal Circuit case law and that a final decision on the merits, such that it would trigger jurisdiction under 28 U.S.C. § 1295(a)(6), must be a decision that is tied to the entry of articles. In doing so, the panel harkened back to an almost 40-year old decision in which the appellant asked the Federal Circuit to review a decision by the Commission regarding the declassification of certain materials. More specifically, in Viscofan, S.A. v. U.S. International Trade Commission, the Federal Circuit found that it did not have jurisdiction to review an ITC decision on declassification because (1) 28 U.S.C. § 1295(a)(6) only gave the Federal Circuit exclusive jurisdiction to review final determinations “relating to unfair practices in import trade” and (2) Congress specifically defined final determinations to include those set forth in the first sentence of Section 1337(c):
The Commission shall determine, with respect to each investigation conducted by it under this section, whether or not there is a violation of this section, except that the Commission may, by issuing a consent order or on the basis of an agreement between the private parties to the investigation, including an agreement to present the matter for arbitration, terminate any such investigation, in whole or in part, without making such a determination.
In other words, ITC decisions that do not affect the validity of an exclusion order are not within the Federal Circuit’s jurisdiction. Since Realtek’s appeal sought sanctions unrelated to the entry of articles, the appeal did not meet this requirement and was dismissed.
Takeaways
While the Federal Circuit did not reach the merits of Realtek’s appeal on the sanctions issue, this decision highlights the importance of understanding the specific jurisdictional boundaries of the Federal Circuit in ITC-related matters, particularly concerning sanctions and other issues that are not ancillary to a final determination. As an aside, the panel did lend some insight into what “ancillary issues” would still be deemed to fall within Federal Circuit jurisdiction under 28 U.S.C. § 1295(a)(6). In this aspect, a decision not to institute an investigation or dismissal for lack of subject matter jurisdiction would be an ancillary issue appropriate for appellate review under Section 1295(a)(6) because they have the effect of conclusively denying the complainant’s request to exclude particular items from entry.
However, the panel recognizes that, based on the statute, it remains an open question which court can review this type of matter. The only guidance from the panel on this question is that “in other settings, courts have held that, in the absence of an indication of where judicial review will take place, ‘the normal default rule is that persons seeking review of agency action go first to district court rather than to a court of appeals.’”
Listen to this post
Elder Care Facilities Not Liable for Sales Tax on Purchase of Ingredients Used to Prepare Food for Residents
In a recent decision, the Louisiana First Circuit Court of Appeal held that nursing homes and adult residential care providers are not required to pay sales tax on their purchases of food ingredients used to prepare meals for residents. Camelot of North Oaks, LLC et al. v. Tangipahoa Parish School System, Sales and Use Tax Division, 2024 CA 0840 (May 22, 2025).
The Facts: Camelot of North Oaks, Kentwood Manor Nursing Home, and Summerfield of Hammond (collectively, the “Taxpayers”) are licensed Louisiana nursing homes and adult residential care facilities required by regulation to provide a “nourishing, palatable, well-balanced diet” to their residents. The Taxpayers contract with their residents to provide services to their residents, including three meals a day, for a lump-sum monthly fee. During the tax periods at issue, the Taxpayers purchased food ingredients, paid taxes on those purchases, and later sought refunds, claiming that the purchases were exempt from sales tax. The Taxpayers cited a statute which exempts sales of meals to residents of nursing homes and residential care providers from sales tax, La. R.S. 47:305(D)(2). The Tangipahoa Parish School System, Sales and Use Tax Division (the “Collector”) denied the refund claims, arguing that the food purchased by the Taxpayers were not “sold” to the residents, and therefore, the initial purchase could not qualify as a nontaxable sale for resale.
The Louisiana Board of Tax Appeals disagreed with the Collector, finding that the provision of meals to residents did constitute a sale and that the initial ingredient purchases were therefore nontaxable sales for resale.
The Decision: The Court began its analysis with La. R.S. 47:305(D)(2), which exempts “[s]ales of meals furnished . . . [t]o the . . . residents of nursing homes [and] adult residential care providers . . . .” The Court recognized that the Taxpayers’ sales of meals to residents would fall within the exemption, but the key issue was whether the Taxpayers “sold” the meals to their residents. The Court looked to the statutory definition of “retail sale,” which is “a sale to a consumer . . . for any purpose other than for resale in the form of tangible personal property . . . .” (Emphasis added). The Court concluded that the Taxpayers’ provision of meals to residents for consideration (as part of the monthly fee) constituted a sale and that the initial purchase of ingredients was therefore a nontaxable sale for resale. The fact that the meals were provided for a bundled fee, rather than being separately itemized, did not alter the character of the transaction as a sale.
The Concurrence: Chief Judge McClendon, in her concurrence, took a more streamlined approach, focusing on the two distinct transactions: (1) the purchase of ingredients by the Taxpayers, and (2) the provision of prepared meals to residents. The concurrence explained that the first transaction is a nontaxable sale for resale if the second transaction is a sale—regardless of whether the second transaction is itself exempt from tax. Because the residents paid consideration for the meals (as part of their monthly fee), the second transaction was a sale, making the initial purchase of ingredients a nontaxable sale for resale. The concurrence also noted that, while residents would normally bear the burden of sales tax as the ultimate consumers, the sale to residents was exempt under La. R.S. 47:305(D)(2). This interpretation of the statutes, the concurrence observed, furthers the public policy of minimizing the cost of meals to nursing home and adult care residents (presumably, if the Taxpayers’ purchase of the ingredients were taxable, the additional cost would be passed through to the residents).
The Takeaway: The main opinion’s focus on the exemption in La. R.S. 47:305(D)(2) is a red herring. The critical issue is not whether the sale by the Taxpayers to their residents was exempt, but whether it was a “sale” at all. The exemption is relevant to the taxability of the end transaction, but the initial purchase of ingredients is nontaxable as a sale for resale so long as the subsequent transaction is a sale—regardless of whether that sale is taxable or exempt. It is important to focus on each transaction in a series of transactions and to determine whether each is subject to tax. Under Louisiana law, a transaction may not be subject to tax, where, as in this case, it is “for resale,” or the transaction may not be subject to tax based on a specific statutory exemption, such as La. R.S. 47:305(D)(2).
Departments’ Opinions Are Not Law
Departments of Revenue frequently issue pronouncements, fact sheets, notices, and the like. While having guidance issued by the taxing authority is generally helpful and encouraged, Departments often forget that such documents are merely statements of their opinion. By definition, an opinion is “a view, judgement, or appraisal formed in the mind about a particular matter” – it is not the final word on that matter. See merriam-webster.com/dictionary/opinion (last visited June 15, 2025). Significantly, the Department’s opinions cannot alter or expand an existing law. This guiding principle was highlighted in a recent Mississippi Supreme Court decision.
In Mississippi Department of Revenue v. Tennessee Gas Pipeline Company, LLC, No. 2023-SA-01079-SCT (May 1, 2025), the taxpayer purchased tangible personal property outside of Mississippi for use in the State. The taxpayer then arranged for shipment of the property into Mississippi by a third party that was not the seller. Use tax was paid in Mississippi on the property, but not on the delivery charges. On audit, the Department assessed use tax on the third-party delivery charges.
On review of the controlling statutes, the Mississippi Supreme Court stated that when property is purchased from a seller and then shipped by that same seller, any freight and delivery charges are likely subject to use tax. However, as in this case, when the seller of the property and the shipper of the property are separate third parties, then such charges are not subject to use tax.
The Department made a meritless argument that the language of the statutes does not limit the Department’s authority to impose use tax on delivery charges. However, the Court refused to so broadly apply the Department’s interpretation and grant the Department authority not specifically vested by the statute.
The Department also alleged that its Fact Sheet was entitled to deference, which stated that use tax was due on delivery charges even when paid to a third-party common carrier that was not the seller. However, the Department’s argument was belied by its own Fact Sheet, which provided that “[n]othing in this fact sheet supersedes, alters, or otherwise changes any provisions of the tax law, regulations, court decisions, or notices.” Miss. Dep’t of Revenue, Delivery Charges (last revised Oct. 2017). Because the controlling statutes did not extend the Department’s authority to impose use tax on third-party delivery charges, the Department’s opinion document to the contrary did not change the Court’s conclusion.
While it is often useful for Departments to issue guidance regarding their interpretation of the tax laws, this case serves as a reminder that such guidance is just their opinion. Such opinions are not—and should not be—irrefutable.
Texas Federal Court Vacates Most of 2024 HIPAA Rule on Reproductive Health Information
In 2024, the U.S. Department of Health and Human Services’ (“HHS”) implemented a new privacy rule under the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) that applied specifically to reproductive health information (the “2024 Rule”). On June 18, 2025, Judge Matthew J. Kacsmaryk of the U.S. District Court for the Northern District of Texas issued an opinion largely vacating the 2024 Rule. The decision in Purl v. U.S. Department of Health and Human Services nullifies the 2024 Rule, except for technical provisions unrelated to reproductive health information.
Judge Kacsmaryk held that HHS exceeded its statutory authority when it created “special protections for medical information produced by politically favored medical procedures…” without a clear congressional mandate. Relying on the major questions doctrine and principles of federalism, the opinion concludes that HIPAA does not authorize HHS to distinguish among categories of protected health information to advance policy goals. The court further found that the 2024 Rule impermissibly: limited state public health and child abuse reporting laws; redefined the terms “person” (to exclude unborn humans) and “public health”; required an attestation prior to the release of certain information; and forced HIPAA covered entities to ascertain the lawfulness of the reproductive services provided before responding to information requests (an obligation Judge Kacsmaryk deemed unworkable).
Because the court vacated the 2024 Rule based on the Administrative Procedure Act, the HIPAA framework in place prior to the 2024 Rule is back in effect. Under that framework, disclosures of protected health information for law enforcement and public health purposes are permissible, but not mandatory (without the need for an attestation regarding how the information will be used), subject to the existing HIPAA Privacy Rule conditions and any state law protections more stringent than HIPAA.
Judge Kacsmaryk’s ruling is effective nationwide, but HHS could seek a stay or pursue an appeal to the Fifth Circuit.
STIR(red) and SHAKEN: How McLaughlin is Changing TCPA and TRACED Act Enforcement
Well, well, well—McLaughlin Chiropractic v. McKesson has truly stirred up the legal landscape—or better yet, shaken an imbalanced tower of FCC interpretations and court splits surrounding one of the most litigated federal statutes: our beloved TCPA. And TCPAWorld is no stranger to this ever-shifting landscape—or the tangled web of regulations that define both compliance and the defense of what has become a cash cow of litigation.
In McLaughlin Chiropractic v. McKesson, the Supreme Court held that the Hobbs Act does not bind district courts in civil enforcement proceedings to an agency’s interpretation of a statute. Rather district courts must independently determine the law’s meaning under ordinary principles of statutory interpretation while affording appropriate respect to the agency’s interpretation. And for companies navigating the FCC’s STIR/SHAKEN framework under the TRACED Act, that’s a big deal.
The TRACED Act (Telephone Robocall Abuse Criminal Enforcement and Deterrence Act) was Congress’s response to the flood of illegal robocalls and spoofed caller IDs. It gave the FCC stronger enforcement tools and required STIR/SHAKEN (Secure Telephone Identity Revisited and Signature-based Handling of Asserted Information Using toKENs) protocols, which require voice service providers to digitally sign and verify caller ID information, making it harder for bad actors to disguise their numbers..
Until now, challenging the FCC’s interpretation of the TRACED Act or its implementation of STIR/SHAKEN was considered nearly impossible at the district court level. The Hobbs Act gave federal court of appeals exclusive jurisdiction to review FCC orders, and many courts treated the agency’s interpretations as binding—regardless of context.
That’s where McLaughlin makes a difference because district courts now have greater freedom to evaluate how the FCC reads and applies the TRACED Act.
This shift is particularly important in litigation involving STIR/SHAKEN. McLaughlin opens the door to as-applied challenges in enforcement actions or private lawsuits. If you’re being sued, the district court can evaluate the FCC’s interpretation of the TRACED Act. Since the TRACED Act is a statute passed by Congress, it is not easily challenged unless there’s a constitutional issue. But how that statute is interpreted and enforced—especially through FCC rules like STIR/SHAKEN—is very much in play.
In the end, McLaughlin clarifies that courts have a duty to interpret statutes for themselves, not simply follow the agency’s lead. And in the TCPA landscape where regulatory rules can dictate millions in liability, it’s critical.
New Jersey Court Allows Product Liability Claims Against Cannabis Retailers
Dispensaries and retailers may face potential liability under the New Jersey Product Liability Act (NJPLA) for alleged design defects or failure to warn.
Hypothetical and speculative future losses are not sufficient to allege an ascertainable loss under the New Jersey Consumer Fraud Act (NJCFA).
New Jersey’s innocent seller statute provides a strong defense, if its requirements are followed.
In the Monmouth County (N.J.) Superior Court, a judge denied a motion to dismiss product liability claims brought by a track and field athlete who alleged that consumption of high-potency, THC-based products led the plaintiff to experience psychotic episodes and attempt suicide. The plaintiff claimed that the retailers “knew or should have known” the risks and failed to adequately warn consumers.
Overview of Claims
The plaintiff sued numerous CBD/THC dispensaries and stores carrying similar products in Monmouth County, alleging claims for: (1) violation of the New Jersey Product Liability Act (NJPLA) for design defect and failure to warn; (2) violation of the New Jersey Consumer Fraud Act (NJCFA); and (3) punitive damages.
The core allegation was that dispensaries and retailers did not adequately disclose the alleged potential dangers associated with consumable edibles and disposable vape devices. Specifically, the plaintiff alleged that defendants failed to disclose that consumption of “high-potency THC concentrates” could result in “hallucinations or psychosis.”
Court’s Ruling on Motion to Dismiss
The retailer defendants moved to dismiss the plaintiff’s NJPLA claims, citing immunity under New Jersey’s innocent seller statute (N.J.S.A. 2A:58C-9). Under this statute, a product retailer who did not exercise significant control over the design, manufacturing, packaging or labeling of the product, is immune from liability if the retailer files an affidavit identifying the product’s manufacturer, with certain exceptions.
The court held that the retailer’s affidavits under the statute were deficient for two reasons: (1) there was insufficient evidence that the manufacturers could be served or satisfy a judgment; and (2) the affidavits did not present sufficient evidence that the retailers were without knowledge of the alleged defects in the products.
The retailers also argued for dismissal of the NJPLA claims, stating the complaint failed to identify any product defect or allege that the products were the proximate cause of the plaintiff’s alleged injuries. The court, applying New Jersey’s liberal standard at the motion to dismiss stage, held that the plaintiff’s complaint alleged sufficient facts to support the NJPLA claims.
The retailers also sought dismissal of the NJCFA claims on the basis that the plaintiff failed to allege an ascertainable loss. The plaintiff argued that the allegations of “hypothetical future pain and suffering, and hypothetical future medical expenses” were sufficient to plead an ascertainable loss. The court held that potential future endorsements or winnings from his professional athletic career were too speculative and were “not quantifiable or measurable damages.” Therefore, the plaintiff failed to allege a claim under the NJCFA.
Finally, the court dismissed the plaintiff’s claim for punitive damages, noting that under New Jersey law, punitive damages are a remedy, not an independent cause of action. The court clarified that while there is no separate claim for punitive damages, the plaintiff may seek such damages if they ultimately prevail on NJPLA claims.
Takeaways
Cannabis has been legal in New Jersey since the state’s Constitution was amended after the 2020 election. This decision serves as a reminder that despite legalization, cannabis retailers may still face product liability claims under certain tort theories. Compliance with the requirements of New Jersey’s innocent seller statute is key when seeking the benefits of its immunity from liability.
New Jersey Required to Turn Square Corners and Pay Untimely Filed Refund Claim
The New Jersey Tax Court has required the Director of the Division of Taxation to turn square corners and pay a refund despite the claim not being timely filed. The ARC/Mercer, Inc. v. Dir., Div. of Tax’n, Docket No. 007970-2024 (N.J. Tax Ct. May 8, 2025).
The Facts: New Jersey imposes a mansion tax on the sales price of certain types of properties including certain commercial properties. The Legislature, however, exempted I.R.C. § 501(c)(3) entities from the mansion tax.
The ARC/Mercer, Inc. (“ARC/Mercer”) is an I.R.C. § 501(c)(3) entity that purchased a commercial property and mistakenly paid the mansion tax. Nine months later it sought a refund of the erroneous payment. The Director refused to pay the refund on the basis that the statute of limitations period under the mansion tax is 90-days.
The Decision: The Tax Court first reviewed the mansion tax, which provides that it is subject to the provisions of the State Uniform Tax Procedure Law (the “Procedure Law”). The mansion tax also provides that, notwithstanding the provisions of N.J.S.A. 54:49-14(a) (which is part of the Procedure Law and generally provides a four-year limitations period for refunds), a taxpayer may file a refund claim within 90 days of payment of the tax. Since ARC/Mercer filed its refund claim nine months after payment, it was untimely and the Tax Court found that the company did not have a refund claim.
The Tax Court then stated “[h]owever, the case is not over” and found that N.J.S.A. 54:49-16(a) of the Procedure Law requires the return of the erroneously paid monies to which “the Director has no entitlement.” That statute generally provides for a limitations period of two years for the return of undisputed erroneous payments under certain limited circumstances. First, the statute is limited to situations where no questions of fact or law are involved. Second, the monies must have been erroneously or illegally collected or paid under a mistake of fact or law.
Here, there are no disputes of fact or law. The fact is that ARC/Mercer is an I.R.C. § 501(c)(3) entity, and the law is that I.R.C. § 501(c)(3) entities are exempt from the mansion tax. The additional requirement is satisfied since ARC/Mercer paid the tax under a mistake of law. Accordingly, the two-year limitations period applied.
The Tax Court rejected the Director’s allegation that the I.R.C. § 501(c)(3) exempt status of ARC/Mercer is in dispute as the status of I.R.C. § 501(c)(3) organizations is a matter of public record available from the Internal Revenue Service’s internet site. “The Director cannot claim ignorance of the status of ARC/Mercer when verification of the status is literally right at her fingertips.”
It is always frustrating when taxing agencies attempt to keep taxes to which they are not entitled. The Tax Court’s decision demonstrates that it will require the Director to turn square corners and not keep such amounts.
Department of Labor Reverses Course on Crypto Guidance for 401(k) Plans
On May 28, 2025, the Department of Labor (DOL) issued Compliance Assistance Release No. 2025‑01 (the 2025 Release), formally rescinding Compliance Assistance Release No. 2022-01 (the 2022 Release) that had urged fiduciaries to exercise “extreme care” before offering cryptocurrencies in 401(k) plans. This rescission marks a shift from placing higher security on plan fiduciaries that offered cryptocurrencies to a more neutral approach towards plans that offer this digital investment option.
The DOL’s 2022 Release
In March 2022, the DOL issued the 2022 Release, in which the agency cautioned plan fiduciaries against offering cryptocurrencies in 401(k) plans. This guidance warned fiduciaries that adding crypto options — whether coins, tokens, or any crypto-linked derivatives — could raise serious ERISA concerns due to digital assets’ volatility, valuation challenges, inexpert plan participants, custodial and recordkeeping risks, and evolving regulations. Although non-binding, the guidance conveyed that fiduciaries may breach their fiduciary duties if they fail to exercise “extreme care” when offering cryptocurrencies in 401(k) plans and further indicated the potential for investigations of plans that invested in cryptocurrencies.
The DOL’s 2025 Release
On May 28, 2025, the DOL issued the 2025 Release, which rescinded the “extreme care” fiduciary interpretation and reaffirmed that plan fiduciaries must continue to satisfy ERISA’s duties of prudence and loyalty when selecting investment options. The 2025 Release explained that the “standard of ‘extreme care’ is not found in [ERISA]” and is beyond ERISA’s ordinary fiduciary principles. The 2025 Release further underscored that the DOL is returning to its “historical approach by neither endorsing nor disapproving of plan fiduciaries who conclude that the inclusion of cryptocurrency in a plan’s investment menu is appropriate.”
The DOL’s Revised Fiduciary Standard
Moving forward, when evaluating any particular investment type, including cryptocurrencies, a plan fiduciary’s decision must generally satisfy ERISA’s duties of prudence and loyalty, should “consider all relevant facts and circumstances,” and will “necessarily be context specific.” Fifth Third Bancorp v. Dudenhoeffer, 573 U.S. 409, 425 (2014).
Supreme Court Provides Crucial Guidance on Venue for Clean Air Act Challenges
On June 18, 2025, the Supreme Court decided Oklahoma v. EPA and EPA v. Calumet, a pair of cases that focus on the Clean Air Act’s (CAA or Act) venue selection provisions.
The judicial review provisions of the Act send review of “nationally applicable” EPA actions to the DC Circuit and review of “locally or regionally applicable” EPA actions to the regional circuits. See 42 U.S.C. § 7607(b)(1). However, in an exception to that rule, venue may lie in the DC Circuit for regionally applicable actions that are “based on a determination of nationwide scope or effect.” In the Court’s two recent decisions, it explained that the CAA venue analysis called for a two-step inquiry. First, courts must decide whether the EPA action is nationally applicable or only locally or regionally applicable; if nationally applicable, the case belongs in the DC Circuit. Second, if locally or regionally applicable, courts must decide whether the case falls within the exception for “nationwide scope or effect” to override the default rule of regional circuit review.
In Oklahoma, the Court held that EPA’s disapproval of the Oklahoma and Utah state implementation plans (SIPs) belonged in a regional circuit, not the DC Circuit. At the first step, the Court found the SIP disapprovals were “[c]learly” “locally or regionally applicable.” The Court held that the disapproval of a SIP by its nature (and by statute) is always a locally or regionally applicable action. EPA cannot change that by grouping multiple state-specific disapprovals into one Federal Register notice. At the second step, the Court set forth a high standard that EPA must clear in order to show that a locally or regionally applicable action is based on a determination of nationwide scope or effect: That determination must lie at the “core” of EPA’s decision, i.e., it must serve as the most important part of EPA’s rationale. EPA receives no deference on this issue. If it is “debatable” whether such a determination lay at the core of EPA’s rationale, then the exception does not apply. In Oklahoma, the Court explained that the SIP disapprovals were based on a variety of state-specific facts and that EPA’s various nationwide determinations were not the primary reasons for disapproving the SIPs. Thus, the exception did not apply, and the litigation belonged in the Tenth, not DC, Circuit.
In Calumet, the Court reached a different conclusion regarding challenges to exemptions under the CAA’s renewable fuels program for fuel refineries. Although EPA’s denial of exemption petitions was “locally applicable,” the Court concluded that EPA had relied on national legal and economic determinations that applied “generically to all refineries, regardless of their geographic location.” Because those nationwide determinations provided the basis for denying the individual exemption requests, they lay at the core of EPA’s action and thus triggered the exemption to bring venue to the DC Circuit.
Together, these decisions clarify the line between national and local or regional EPA actions for purposes of venue under the CAA. Oklahoma suggests that actions grounded in state-specific facts (like SIP disapprovals) belong in regional circuits, even if decided in omnibus fashion or using a shared analytical framework. Calumet shows that when EPA applies a uniform national rationale not grounded in state- or region-specific considerations, challenges belong in the DC Circuit.
The Oklahoma decision will be particularly helpful in clarifying proper venue in other cases involving state plans. For example, under the current administration, EPA is proposing to approve state plans for “reasonable progress” on visibility improvement during the second planning period. Venue for any challenges to those EPA approvals will presumptively lie in the local circuits.
Looks Like Estoppel, Sounds Like Estoppel … But It’s Just Director Discretion
The acting director of the US Patent & Trademark Office (PTO) granted a patent owner’s request for discretionary denial and denied institution of an inter partes review (IPR) proceeding, finding that the petitioner engaged in unfair dealings by challenging a patent on which its employees were the inventors. Tessell, Inc. v. Nutanix, Inc., IPR2025-00322 (PTAB June 12, 2025) (Stewart, Act. Dir.)
Four individuals were Nutanix employees when they invented the subject matter of the challenged patent. Two of the individuals left to form Tessell and later hired the other two. Tessell, which now includes nearly all of the inventors of the challenged patent, filed a petition for IPR arguing that the claims of the patent were unpatentable. Nutanix filed a request for discretionary denial, which Tessell opposed.
The doctrine of assignor estoppel generally prevents an inventor who has sold or assigned a patent from challenging the validity of the patent. Although assignor estoppel does not apply in IPR proceedings, the acting director explained that the PTO may consider unfair dealings as a factor when determining whether to exercise discretion to deny institution under 35 U.S.C. § 314(a). The acting director found that it was inappropriate for the inventors to have used PTO resources to obtain a patent only to later advocate for its unpatentability. The acting director therefore exercised discretion to deny institution.
Overdraft Fee Agreements — A Cautionary Tale
Community banks are being sued more frequently in overdraft fee lawsuits. Many of these actions are putative class action lawsuits that can be costly for banks to defend and complicated to settle. At the center of these lawsuits are claims that banks’ account agreements are confusing, unfair, or deceptive. These claims often focus on banks’ “authorize positive, settle negative” (APSN) overdraft practices. Plaintiffs also commonly claim that banks charge nonsufficient funds fees and multiple re-presentment fees on a single item without customers’ agreement and charge multiple foreign ATM transaction fees.
Overdraft Fees and Opt-In Agreements
An APSN transaction happens when a debit card transaction is authorized while there are sufficient funds in the customer’s account, but then intervening transactions settle and decrease the amount of available funds, resulting in insufficient funds to cover the initial transaction. Because there are insufficient funds in the account when the initial transaction settles, the bank charges an overdraft fee.
Plaintiffs claim that charging an overdraft fee in this situation is either a breach of the account agreement or is unfair and deceptive because the agreement did not clearly explain the bank’s overdraft practices. Regulation E (12 CFR § 1005) requires financial institutions, including community banks, to provide notice to customers of the bank’s overdraft services and give the customer a reasonable time to “opt in” to those services. Banks are also required to provide written confirmation of the customer’s opt in and inform the customer of their right to “opt out” of the overdraft services at any time. The form, substance, and presentation of these disclosures are critical to defending an overdraft fee lawsuit and minimizing the risk of future litigation.
To aid in drafting these disclosures, the Federal Reserve created the Model A-9 Consent Form for Overdraft Services (Model Form). In the years since its creation, courts have considered whether the Model Form provides customers with sufficient notice of a bank’s overdraft services. Generally, courts have found that if the Model Form does not exactly and completely describe a bank’s overdraft practices, then it is an inadequate disclosure. Inadequate or confusing opt-in agreements can also give rise to breach of contract claims if customers incur overdraft fees that they believe are in violation of a bank’s stated overdraft practices.
Class Action Lawsuits in Mississippi
Mississippi banks are not immune from these lawsuits. Plaintiffs have recently filed class action lawsuits against community banks for breach of contract, claiming that the defendant bank charged overdraft fees in violation of the bank’s overdraft agreement. Bringing claims for breach of contract is usually preferable for plaintiffs because they have three years to bring state law breach of contract claims and only one year to bring federal claims under the Electronic Funds Transfer Act. The three-year limitation period on breach of contract claims also broadens the criteria for potential members of a plaintiff class. However, there are jurisdictional defenses that community banks in Mississippi should consider.
Class Action Fairness Act
Because Mississippi state courts do not have a procedural device for plaintiffs to bring class action lawsuits in state court, plaintiffs must file class action lawsuits in a federal court in Mississippi. In class action lawsuits where the plaintiff only asserts state law breach of contract claims, the plaintiff must establish federal class action jurisdiction under the Class Action Fairness Act (CAFA). CAFA expands federal jurisdiction to class action lawsuits where at least one plaintiff is a citizen of a different state than at least one defendant and the amount in controversy exceeds $5 million in the aggregate.
However, there are a few exceptions to CAFA jurisdiction. The “home state” exception is particularly relevant for community banks with large, local customer bases. This exception applies when two-thirds of the proposed plaintiff class are citizens of the state where the lawsuit is filed, and the defendant bank either (1) is incorporated in the state where the lawsuit is filed or (2) has its principal place of business in the state where the lawsuit is filed. If the defendant bank shows the requirements of the home state exception are met, a court cannot exercise jurisdiction over the lawsuit.
Banks should also be aware that exceptions to CAFA jurisdiction can be waived if not raised early in the proceedings. Evaluating the availability of the home state exception and other exceptions to CAFA jurisdiction is critical as similar class action lawsuits have survived the motion to dismiss stage, with courts finding that the defendant bank’s opt-in agreement is not so clear as to preclude the plaintiffs’ claims.
Case Closed: Commission Sanctions Ruling Isn’t an Import Decision
The US Court of Appeals for the Federal Circuit dismissed an appeal for lack of jurisdiction, finding that a denial of sanctions at the International Trade Commission was not a “final determination” under trade law because it did not affect the exclusion of imported goods. Realtek Semiconductor Corp. v. ITC and Future Link Systems, LLC, Case No. 23-1187 (Fed. Cir. June 18, 2025) (Reyna, Bryson, Stoll, JJ.)
In 2019, Future Link entered into a license agreement with MediaTek, Inc. (not a party to the present litigation), which included a provision for a lump-sum payment if Future Link filed a lawsuit against Realtek. Future Link subsequently initiated a patent infringement complaint against Realtek before the Commission. During the proceedings, Future Link settled with a third party and determined that the settlement resolved the underlying dispute, prompting it to notify Realtek and ultimately withdraw its complaint. Realtek moved for sanctions, citing the MediaTek agreement as improper, but the administrative law judge (ALJ), while expressing concern about the agreement’s lawfulness, found no evidence it influenced the complaint and denied sanctions. The Commission terminated the investigation after no petition for review of the ALJ’s termination order was filed. Realtek then petitioned the Commission to review the denial of sanctions, but the Commission declined, closing the sanctions proceeding. Realtek appealed to the Federal Circuit, not challenging the investigation’s termination but seeking an order requiring Future Link to pay a fine based on the alleged impropriety of its agreement with MediaTek.
Realtek argued that the Commission and the ALJ violated the Administrative Procedure Act (APA). In response, the Commission and Future Link not only defended the denial on the merits but also challenged the Federal Circuit’s jurisdiction and Realtek’s standing to appeal. The Court agreed that it lacked jurisdiction under 28 U.S.C. § 1295(a)(6), which only authorizes review of final determinations under specific subsections of Section 337 of the Tariff Act of 1930 (19 U.S.C. § 1337). Because the Commission’s denial of sanctions under subsection (h) does not constitute a “final determination” under § 1337(c), the Court declined to address standing or the merits of the sanctions issue.
The Federal Circuit emphasized that a “final determination” within the meaning of § 1295(a)(6) refers to decisions affecting the exclusion of imported articles, such as those made under subsections (d), (e), (f), or (g) of § 1337. Realtek argued that the Commission’s denial of its sanctions request qualified as a final merits decision, but the Court disagreed, citing long-standing precedent, including its 1986 decision in Viscofan, S.A. v. ITC, that limits appellate jurisdiction to exclusion-related rulings. Because the sanctions decision had no bearing on whether products were excluded from importation, the Court held that it lacked the authority to review and dismissed the appeal.