Providing summaries of opinions as they are released from the Michigan Supreme Court, Michigan Court of Appeals (published & unpublished), and selected U.S. Sixth Circuit. Over 60,000 cases summarized to date.
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Federal Communications Commission (FCC) data breach reporting requirements under § 222 of the Telecommunications Act (47 USC § 222); “Customer proprietary network information” & “personally identifiable information” (PII); Whether the FCC’s 2024 Order exceeded its statutory authority; § 201(b); “Practice”; Global Crossing Telecomms, Inc v Metrophones Telecomms, Inc; Whether the FCC had the authority under §§ 225(a)(3) & (d)(1)(A) to impose the reporting requirements on “telecommunications relay services” (TRS) providers; Whether the 2024 Order violated the Congressional Review Act (CRA)
The court denied consolidated petitions for review, holding that the FCC had the authority to issue its 2024 Order “imposing reporting requirements on telecommunications carriers in the event of data breaches involving customers’ personally identifiable information.” Petitioners argued the 2024 Order exceeded the FCC’s statutory authority and violated the CRA where it was substantially the same as a 2016 Order that Congress had rejected. The court reviewed the statutes on which the FCC based its authority. It first concluded “that the FCC does not have the authority under § 222(a) to impose data breach reporting requirements regarding customer PII.” However, it held, “based on the statutory text, context, and structure, that § 201(b) gives the FCC the authority to impose reporting requirements in the event of a data breach of customer PII.” It rejected petitioners’ argument that the FCC’s historical interpretation and implementation of § 201(b) undermined this conclusion. It noted that it had “been over a decade since the FCC invoked § 201(b) as part of its statutory authority to protect customer data. That invocation is properly supported by the statute’s plain text, context, and structure.” The court also held that § 225 gave the FCC authority to apply the 2024 data breach reporting requirements to TRS providers. Given that it “determined that the FCC has the statutory authority to impose the 2024 data breach reporting rule on telecommunications carriers . . . . [§] 225’s functional equivalency requirement, in turn, gives the Commission authority to extend the same data privacy protections to the TRS context.” As to petitioners’ CRA argument, the court noted that “under the CRA’s plain text, we must compare the 2024 Order to the entire 2016 Order and determine whether they are substantially the same.” It found that the 2024 Order was “far from ‘fully,’ ‘considerably,’ or ‘significantly’ the same as the 2016 Order. The 2016 Order was far more expansive, imposing a broad array of privacy rules on broadband Internet access services. The data breach notification requirements were a mere subset of the broader compendium of privacy rules in that Order. The 2024 Order, by contrast, addresses only data breach reporting requirements. The two rules are not substantially the same.”
Class certification under FedRCivP 23(b)(3); Liability under § 10 of the Securities Exchange Act (15 USC § 78j(b)) & Securities & Exchange Commission (SEC) Rule 10b-5 (17 CFR § 240.10b-5); Applicability of the “presumption of reliance” analysis applied under Affiliated Ute Citizens of UT v United States in a case alleging both omissions & misrepresentations; Basic Inc v Levinson; “Rigorous analysis” of whether plaintiff class established that “damages are susceptible of measurement across the entire class”; Comcast Corp v Behrend
In this interlocutory appeal, the court held that the district court erred by granting plaintiffs in this securities case class certification where it applied the Affiliated Ute presumption of reliance. The legal standard should be to analyze a “mixed” case (one based on both omissions and misrepresentations) “under Affiliated Ute only if it is primarily based on omissions.” The district court “abused its discretion when it incorrectly applied that standard and concluded that in this case ‘the communications at issue are primarily omissions-based.’” Rather, the allegations here “make up a mixed case that is primarily based on misrepresentations.” Thus, it was “subject to analysis under Basic, not Affiliated Ute.” Plaintiffs moved for class certification on behalf of a group of defendant-FirstEnergy’s bondholders and stock purchasers. The court found that the district court erred by granting plaintiffs class certification on their Exchange Act § 10(b) and SEC Rule 10b-5 claims. The Supreme Court has limited use of Affiliated Ute to “cases involving ‘primarily’ omissions[.]” The court held that a federal court in this circuit, “in assessing what a mixed case is ‘primarily’ based on, must follow a two-step analysis. First, it must classify each claim or group of claims as alleging either an omission or a misrepresentation. Both half-truths and generic, aspirational corporate statements are classified as misrepresentations. Second, it must characterize whether the overall case is primarily based on omissions or on misrepresentations by analyzing whether any of these four factors are satisfied: (1) the alleged omissions are only the inverse of the misrepresentations, i.e., the only omissions are the truth that is misrepresented; (2) reliance is in fact possible to prove by pointing to an alleged misrepresentation and connecting it to an injury; (3) the preponderance and primary thrust of the claims involve alleged misrepresentations made by the defendant(s); or (4) the alleged omissions have no standalone impact apart from any alleged misrepresentations. If even one of these four factors is satisfied, the mixed case is primarily based on misrepresentations and thus subject to analysis under the Basic presumption.” Only if none of them are satisfied, is the mixed case “primarily based on omissions and thus subject to analysis under the Affiliated Ute presumption.” The court found that this mixed case was “primarily based on misrepresentations” and thus, the analysis should have been under Basic, not Affiliated Ute. It also held that “the district court incorrectly overlooked Comcast’s rigorous-analysis requirement in its damages analysis of” the Exchange Act claims. Vacated and remanded.
Land contract dispute; Zurcher v Herveat; Principle that because land contracts involve an interest in lands, they are subject to the statute of frauds under MCL 566.106 & MCL 566.108; The partial-performance doctrine; Dumas v Auto Club Ins Ass’n; Distinguishing Bruno v Zwirkoski; Oral agreement; Clear & convincing evidence standard
The court held that the trial court did not err by granting defendants summary disposition of plaintiff’s claims regarding the parties’ land contract. According to the contract, plaintiff was to make monthly payments for three years followed by a balloon payment to purchase defendants’ property. Plaintiff did not meet the ballon payment deadline and continued making monthly payments, but ten months later emailed defendant-Torres stating she was ready to close. Defendants declined, and plaintiff claimed Torres had verbally agreed to the time extension. Plaintiff sued defendants seeking specific performance of the land contract based on their failure to perform the necessary duties to finalize the transaction. Defendants moved for summary disposition on the ground that plaintiff’s claims were barred by the statute of frauds and her own breach of the contract. Plaintiff claimed she raised a genuine issue of material fact as to whether Torres agreed to extend the balloon-payment deadline, and that the partial-performance exception to the statute of frauds applied. The trial court granted defendants’ motion and dismissed the complaint. On appeal, the court found that because plaintiff could not “produce a writing supported by consideration indicating that the parties agreed to extend the balloon-payment deadline, any verbal agreement to that effect was unenforceable under the statute of frauds.” In addition, because the “contract specifically noted that the monthly installments were insufficient to pay the full obligation” plaintiff’s conduct did “not amount to substantial performance of the contract to warrant the partial-performance exception.” Further, given “the lack of clarity in plaintiff’s own testimony, she failed to meet her burden of establishing an oral agreement by clear and convincing evidence.” Affirmed.
Sufficiency of the evidence; Resisting or obstructing a police officer; MCL 750.81d(1); People v Quinn; Whether the officer’s conduct was lawful; People v Moreno; Ineffective assistance of counsel for inadequately investigating the circumstances of the traffic stop, failing to consult an expert witness, & neglecting to request appropriate jury instructions; Trial strategy; Right to a properly instructed jury; People v Guajardo; Right to resist instruction; M Crim JI 13.1 & 13.2; Use Note to M Crim JI 13.5; Prejudice
The court held that the evidence was sufficient to support defendant’s conviction, and that he was not denied the effective assistance of counsel. He was convicted of resisting or obstructing a police officer and sentenced as a third-offense habitual offender to 10 days in jail. On appeal, the court rejected his arguments that: (1) the evidence was insufficient to support his conviction, and (2) his trial counsel rendered ineffective assistance by inadequately investigating the circumstances of the traffic stop, failing to consult an expert witness, and neglecting to request appropriate jury instructions. First, “[g]iven the testimony and video evidence, the jury could reasonably conclude that defendant resisted or obstructed” and that the officer “acted lawfully when he attempted to arrest defendant.” Second, although defendant claimed “expert testimony ‘would have further supported the defense theory that’” the officer acted unlawfully, the mere fact that such testimony might have been helpful did not render counsel’s performance deficient. “The central issues in this case—visibility, distance, and perception—were within the understanding of the average juror.” Further, although “M Crim JI 13.1 may have been the more appropriate instruction for the charged offense, defendant cannot establish prejudice. By using M Crim JI 13.2, the [trial] court effectively increased the prosecution’s burden by requiring proof of intent, which is not required under MCL 750.81d(1).” Moreover, defendant’s “defense theory of the case—that he lawfully resisted an unlawful arrest—presumes that his actions were intentional. It is therefore unclear how including the intent element undermined the defense.” He also failed to show “that the omission of the Use Note language prejudiced his defense.” Affirmed.
Sufficiency of the evidence; Assaulting, resisting, or obstructing a police officer; MCL 750.81d(1); Knowledge; Distinguishing People v Prude; Lawfulness of the officers’ conduct
Holding that there was sufficient evidence to support defendant’s assaulting, resisting, or obstructing a police officer conviction under MCL 750.81d(1), the court affirmed. The court concluded that “taken together, the facts and circumstances presented at trial gave defendant ample reason to know that Deputy [H] and Sergeant [B] were police officers performing their official duties at the time of the incident.” The court noted that both “officers arrived in marked patrol vehicles and wore full police uniforms. The headlights from [H’s] patrol vehicle illuminated the driveway, and he stood in front of those lights while interacting with defendant.” Although neither “officer expressly identified himself as law enforcement, [H] repeatedly stated that he was responding to a call about a potential assault and warned that he would use a taser if defendant did not show his hands—clear indications that he was acting as a police officer. During the struggle, both officers stated that defendant was under arrest, and [B] can be heard communicating with dispatch over his radio.” Moreover, the “officers testified that they had interacted with defendant on multiple prior occasions in their official capacities.” Defendant also contended “that the officers acted unlawfully when they detained him, relying on Prude.” The court held that argument mischaracterized the record. There was “no support in the record for the claim that the officers sought to detain defendant before he made threatening gestures and hostile statements. Nor were defendant’s convictions predicated on resisting an attempted detention or arrest, as was the case in Prude.” The relevant inquiry was “not whether the officers had reasonable suspicion to detain defendant, but whether their commands were lawful in light of the circumstances. The evidence was sufficient to establish that the officers’ commands, ‘when viewed under a lens sufficiently deferential to that conduct,’” were lawful. The court concluded that given his “behavior—including his refusal to comply, his aggressive posture, and his ambiguous and potentially threatening comments—the officers reasonably feared for their safety and were justified in ordering him to show his hands. Because those commands were lawful, defendant’s noncompliance supports his convictions under MCL 750.81d(1).”
Child’s best interests; In re Gonzales/Martinez; In re White; In re Rippy; In re Olive/Metts Minors
Holding that the trial court did not clearly err in finding that terminating respondent-mother’s parental rights was in the best interests of the child at issue on appeal, the court affirmed the termination order. Respondent only appealed the order as to one of the children, and only challenged the trial court’s best-interests determination. The court found that the trial court’s statements indicated that it considered the child’s best interests individually. The child had “special needs involving his diagnoses for autism, post-traumatic stress disorder, and attention-deficit hyperactivity disorder.” The trial court also acknowledged the child’s “bond with respondent, but” additionally noted “the fact that respondent lacked housing, employment stability, and the parental capacity to provide for [the child’s] basic needs, let alone special needs, after two years.” The trial court further noted “that respondent had recently addressed her transportation issues by living in a city that provided a consistent bus system, but [it] still expressed concern over transportation for [the child] ‘if there was an emergency.’” In addition, it “acknowledged that respondent had her own trauma that she had to deal with in individual counseling and through the use of approximately 10 different medications for her mental health.” Thus, it found that she “struggled to take care of herself, much less” show that she could care for the child’s “special needs. In contrast, [his] placement—although not firmly determined to be permanent at the time of trial—was providing him with stability and consistency. CPS reported that [he] was doing well in his placement where his special and medical needs were being addressed by his foster parents and through services at his school, including speech and sensory therapy.” In light of “respondent’s inability to maintain employment, secure appropriate housing, and to consistently demonstrate the parenting skills necessary to care for” the child, the court found no clear error in the trial court’s best-interests ruling.
Termination under § 19b(3)(c)(i); Children’s best interests; Whether the factual record was complete or adequate
The court held that as to § (c)(i), “the record clearly and convincingly proved that there was no reasonable likelihood that respondent[-mother] would timely rectify her drug abuse and other barriers to reunification, and the trial court did not err by so finding.” Also, it saw “no error in the trial court’s determination that termination of respondent’s parental rights was in the children’s best interests.” Finally, her “lack of participation in her service plan or these child protective proceedings was not caused by her being improperly excluded or denied a meaningful opportunity, it was caused by her choice not to participate.” As to § (c)(i), “the conditions that led to the adjudication and that continued to exist as being respondent’s mental health, substance abuse, domestic violence, inadequate parenting skills, inadequate housing, and financial issues.” She did “not contest that these conditions continued to exist, nor does she dispute that more than 182 days elapsed between the issuance of an initial dispositional order and termination.” Rather, she argued “that the trial court erred by finding that there was no reasonable likelihood that she would rectify these conditions within a reasonable time considering the ages of the children.” Respondent claimed “that the trial court improperly focused on her problematic history, and not on the recent positive steps that she had made.” The court found that because “of her drug use, respondent never secured stable employment, which in turn prevented her from having her own transportation, led to utilities in her home being shut off, and led to her home being foreclosed upon for unpaid property taxes.” Despite her claim “that she has made recent progress toward rectifying the issues that led to the adjudication, she has not demonstrated any kind of meaningful and lasting progress.” Affirmed.