Del Webb Communities, Inc. v. Partington

United States Court of Appeals for the Ninth Circuit · Property

Propertyinjunctionslicensing of home inspectorsdeceptive trade practicesstandingchamperty and maintenanceRule 65(d)vagueness

Facts

Mojave inspected homes in Del Webb's Sun City Anthem development and encouraged homeowners to pursue Nevada Chapter 40 construction-defect claims against Del Webb. Mojave advertised the inspections as free, suggested that it was working with the builder or the builder's inspection team, and represented itself as affiliated with Del Webb while lacking a Chapter 645D structural inspection license. Mojave expected payment for its inspection work through homeowners' recoveries from builders and took assignments of the right to recover inspection fees. The district court entered a permanent injunction barring Mojave from inspections and reports in Del Webb developments through illegal, unlicensed, and false practices, including false claims of licensing and affiliation.

Issue

Whether the district court's permanent injunction was sufficiently specific under Rule 65(d), whether Nevada law required Mojave to have a Chapter 645D license and allowed Del Webb to seek relief for Mojave's unlicensed practices, and whether Nevada common law supported an independent tort claim for champerty and maintenance by Del Webb. The appeal also concerned whether the specific prohibitions on false claims of licensing and affiliation could stand even if the broader injunction language could not.

Rule

An injunction must state specifically and in reasonable detail the acts restrained; a broad prohibition on acting through 'illegal, unlicensed and false practices' is too vague even when followed by illustrative examples. Under Nevada Chapter 645D, a person who examines components of a structure and prepares or communicates inspection reports for or with the expectation of compensation must obtain the required certificate unless an express statutory exception applies. Under NRS 41.600, any person directly harmed as a victim of consumer fraud, including deceptive trade practices based on operating without required licenses, has standing to sue. A federal court sitting in diversity should not recognize a new Nevada common-law tort for champerty absent a secure basis to predict the Nevada Supreme Court would do so.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Phoenix, a trial court enters a permanent injunction against Desert Frame Analytics, a company that evaluates house foundations in a planned community. The order bars the company from conducting inspections there "through unlawful, unlicensed, or misleading methods, including prior tactics shown at trial," and then lists two examples of past misconduct.

If the company appeals, which argument is strongest?

Explanation. Rule 65(d) requires an injunction to state specifically and in reasonable detail the acts restrained. A broad prohibition on acting through "unlawful, unlicensed, or misleading methods" is too vague even if followed by illustrative examples, because a layperson still cannot tell what other future conduct would violate the order. The case approved specific prohibitions but rejected this kind of general catchall language.