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February 23, 2017
  Boone v. Everett, et al. -- Fourth Circuit
Both Sides of Story Must Be Considered in Pro Se Eighth Amendment Case

Areas of Law: Constitutional Law, Eighth Amendment

Issue Presented: Whether the District Court properly granted a motion for summary judgment on a defendant's excessive force claims against two prison officers.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that the United States District Court for the Eastern District of Virginia erred in granting Officer C.D. Everett summary judgment on a 42 U.S.C. § 1983 excessive force claim when the court based its decision solely on the affidavits and story of the prison where the defendant was incarcerated. However, the Fourth Circuit upheld the motion for summary judgment for Sergeant L. Rodriguez because the only evidence Boone, a pro se appellant, offered to support his Eighth Amendment claims against Rodriguez were conclusory allegations.

Extended Summary: Wally Boone asked Fourth Circuit to review the District Court's grant of summary judgment and denial of relief on his 42 U.S.C. § 1983 excessive force claim. In his claim to the district court, Boone alleged that two prison officials, Officer C.D. Everett and Sergeant L. Rodriguez, used excessive force against him. Specifically, he alleged that Officer Everett slammed his head into a wall, threw him on the floor, jumped on top of him, and choked him until he lost consciousness. He also alleged that Sergeant Rodriguez dragged him to the medical department while threatening to drop him and allowed his genitals to remain exposed. The district court granted the Defendants' motion for summary judgment. The Fourth Circuit affirmed in part, vacated in part, and remanded for further proceedings.

The Fourth Circuit noted that a district court can only award summary judgment if no genuine dispute of material fact remains and the record indicates that the moving party is entitled to judgment as a matter of law. When the moving party shows there is no genuine issue of material fact, the nonmoving party must "go beyond the pleadings" and rely on evidence, including affidavits, to demonstrate that a genuine issue of material fact exists. Thus, to survive summary judgment, the nonmoving party must produce competent evidence that is more than conclusory or speculative allegations. The Fourth Circuit noted that in reviewing the evidence submitted by the parties, a court cannot "credit the evidence of the party seeking summary judgment and fail to properly acknowledge key evidence offered by the party opposing that motion." In other words, at the district court level, the district court could not only credit the evidence of Everett and Rodriguez, but had a duty to credit that proffered by Boone as well.

In making an Eighth Amendment claim for excessive force, a prisoner must prove that the official possessed a culpable state of mind and caused the prisoner a sufficiently serious deprivation or injury. Specifically, a prisoner must prove that the official acted "maliciously and sadistically for the very purpose of causing harm" rather than "in a good faith effort to maintain or restore discipline." Factors used to analyze malicious or sadistic intent include: (1) the need for force, (2) the degree of force used in relation to the need for force, (3) the existence of a threat reasonably perceived by the official, (4) any efforts made to lessen the severity of a forceful response, and (5) the extent of a prisoner's injury. In analyzing the excessive force claim against Everett, the Fourth Circuit held that the district court's opinion contained flaws that necessitated remand. The Fourth Circuit noted that the opinion made no mention of the evidence Boone proffered to support his claim which included (1) his affidavit attesting to his account of the incident, (2) his prison grievances detailing injuries consistent with his allegations, and (3) affidavits from three other inmates who attested that they observed Everett's alleged conduct. The Fourth Circuit stated that a court may only reject the nonmoving party's evidence, such as Boone's, when uncontroverted evidence in the record "blatantly contradicts it." The court found no such blatant contradictions to exist in the record below. The Fourth Circuit noted that by overlooking Boone's evidence, the district court's opinion relied almost exclusively on the Defendant's account.

Turning to Boone's excessive force claims against Sergeant Rodriguez, the Fourth Circuit held that the district court applied the proper standard in granting Rodriguez's motion for summary judgment. The Fourth Circuit held that Boone's conclusory allegations coupled with an affidavit by a witness (who testified to seeing the alleged violation, but failed to identify the officer or explain why the officer dragged Boone), presented "a mere scintilla of evidence." Thus, the Fourth Circuit found that Boone had not raised a genuine dispute of material fact regarding whether Rodriguez acted maliciously or sadistically.

The Fourth Circuit vacated the grant of summary judgment to Everett and affirmed the grant of summary judgment to Rodriguez. They affirmed in part, vacated in part, and remanded the case.

To view a full version of the opinion, clickhere.

Panel: Judges Traxler, Keenan, and Wynn

Argument Date: 09/28/2016

Date of Issued Opinion: 10/21/2016

Docket Number:
No. 16-6843

Decided: Affirmed in part, vacated in part, and remanded by unpublished per curiam opinion

Case Alert Author: Dena Robinson, Univ. of Maryland Carey School of Law

Counsel:
Wally Boone, Appellant Pro Se. John Michael Parsons, Assistant Attorney General, Richmond, Virginia, for Appellees.

Author of Opinion: Per curiam

Case Alert Supervisor:
Professor Renee Hutchins

    Posted By: Renee Hutchins @ 02/23/2017 03:36 PM     1st Circuit     Comments (0)  

February 14, 2016
  McFarland v. Wells Fargo Bank -- Fourth Circuit
Homeowners Take Note: Mortgage Loan Contracts May Be Unenforceable Under West Virginia Statute, If Unconscionably Induced

Areas of Law: Business Law, Contracts Law

Issue Presented: Whether under the West Virginia Consumer Credit and Protection Act ("WVCCPA"), a loan can be found to be substantively unconscionable, unconscionably induced, or both, solely on the ground that the loan amount exceeds the property value.

Brief Summary: In a published opinion, the United States Court of Appeals for the Fourth Circuit upheld the United States District Court for the Southern District of West Virginia's holding that a mortgage loan exceeding the home's value cannot be deemed substantively unconscionable on that ground alone. However, the Fourth Circuit also found that the district court erred when it dismissed the loan recipient's separate unconscionable inducement claim on the ground that the recipient had not made a proper showing of substantive unconscionability.

Extended Summary: In 2004, Philip McFarland purchased his home in Hedgesville, West Virginia, for approximately $110,000. In 2006, seeking to combine his $40,000 student and vehicle debt with his mortgage, McFarland entered into two secured loan agreements. The first, the subject of this dispute, was a mortgage agreement with Wells Fargo Bank ("Wells Fargo"), with a principal amount of $181,800 and an adjustable interest rate between 7.75% and 13.75%. The second loan, which is not directly at issue here as the parties reached a settlement, was with Greentree Mortgage Corporation ("Greentree"), a third party mortgage lender, for an interest-only home equity line of credit of $20,000. Prior to the agreements, Greentree appraised McFarland's property at $202,000. However, a 2012 retroactive appraisal showed that McFarland's home was worth just $120,000 in 2006.

In 2012, after several failed mortgage restructure attempts, a 2010 loan modification and years of McFarland falling behind on his payments, Wells Fargo initiated foreclosure proceedings on his home. In order to stop the proceedings, McFarland filed suit against Greentree, Wells Fargo, and U.S. Bank National Association ("U.S. Bank"), a loan trustee, alleging that the Wells Fargo loan was unconscionable under the WVCCPA. McFarland asserted a traditional substantive unconscionability argument - arguing that because the Wells Fargo loan exceeded the property value and did not provide him with a "net tangible benefit," the loan was substantively unconscionable. McFarland also raised a novel unconscionable inducement argument asserting that the loan was induced by misrepresentation as evidenced by the inflated 2006 home appraisal.

The district court granted the lenders' motion for summary judgment and dismissed McFarland's unconscionability claims on the ground that a loan's size alone without unfairness in the specific loan terms does not amount to substantive unconscionability. Moreover, the district court concluded that since McFarland was not able to make a showing of substantive unconscionability, which is required under West Virginia's unconscionability doctrine, there was no need to even consider his unconscionable inducement argument regarding the process that led to the loan contract's formation. McFarland appealed.

The Fourth Circuit affirmed the district court's decision on McFarland's substantive unconscionability claim finding that the loan was not one-sided because it benefited McFarland by providing him with the money that he requested, and the loan exposed all parties to risk (not just McFarland). The court also affirmed the lower court's conclusion that cancelling the debt altogether, thereby relieving McFarland of his debt, was not a permissible remedy under West Virginia law and the "net tangible benefit" test was not relevant as that test would have applied to fees that McFarland had not challenged.

However, the Fourth Circuit remanded the district court's ruling on McFarland's unconscionable inducement claim, ordering the lower court to consider McFarland's unconscionable inducement evidence and to determine if it allowed him to proceed against the lenders. The Fourth Circuit found that although the matter had not yet been fully settled under West Virginia law, the West Virginia Supreme Court of Appeals might rule that the WVCCPA authorized a stand-alone unconscionable inducement claim that did not require a showing of substantive unconscionability.

The Fourth Circuit based its finding on a prior West Virginia Supreme Court of Appeals case that strongly indicated the WVCCPA allows for unconscionable inducement claims separate and apart from substantive unconscionability. The Fourth Circuit also concluded that the comments to the Uniform Consumer Credit Code (UCCC), which are highly relevant to construction of the WVCCPA, indicate that a stand-alone unconscionable inducement claim does exist.

The Fourth Circuit also vacated and remanded the district court's order on a separate count of McFarland's complaint that sought to hold the lenders' liable for unconscionable contracting under agency and joint venture theories.

To read the full text of this opinion, please click here.

Panel: Judges Shedd, Diaz, and Harris

Argument Date: 10/28/15

Date of Issued Opinion: 01/15/16

Docket Number: Case No. 14-2126

Decided: Affirmed in part, vacated in part, and remanded by published opinion.

Case Alert Author: Simone Chukwuezi, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Jennifer S. Wagner, MOUNTAIN STATE JUSTICE, INC., Clarksburg, West Virginia, for Appellant. John Curtis Lynch, TROUTMAN SANDERS LLP, Virginia Beach, Virginia, for Appellees. ON BRIEF: Bren J. Pomponio, MOUNTAIN STATE JUSTICE, INC., Charleston, West Virginia, for Appellant. Jason Manning, Megan Burns, TROUTMAN SANDERS LLP, Virginia Beach, Virginia, for Appellees. Jason E. Causey, BORDAS & BORDAS, PLLC, St. Clairsville, Ohio; Jonathan Marshall, Patricia M. Kipnis, BAILEY & GLASSER, LLP, Charleston, West Virginia, for Amici The National Consumer Law Center, AARP, The National Association of Consumer Advocates, and The Center for Responsible Lending. Floyd E. Boone, Jr., Stuart A. McMillan, Sandra M. Murphy, James E. Scott, BOWLES RICE LLP, Charleston, West Virginia, for Amici Community Bankers of West Virginia, Inc. and The West Virginia Bankers Association, Inc.

Author of Opinion: Judge Harris

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 02/14/2016 02:52 PM     1st Circuit     Comments (0)  

February 12, 2016
  U.S. v. Snowden - Tenth Circuit
Case Name: U.S. v. Snowden

Headline: Tenth Circuit Holds Possible $1.5 million Error in Sentencing Calculations Was Harmless

Area of Law: Criminal Procedure, Sentencing

Issue Presented: Whether the district court erred in calculating the sentencing enhancement based on a calculation of loss that was the sum of the pecuniary costs and the costs to develop a proprietary database. And if so, whether the error was harmless.

Brief Summary:

Defendant pleaded guilty to unlawfully obtaining information from a protected computer and to unlawfully intercepting emails. The district court found that because these crimes caused over one million dollars in losses, a 16-level sentencing enhancement was appropriate. The resulting guideline range was 41-51 months in prison, though the court varied downward and imposed a 30-month sentence.

Defendant appealed, arguing that the loss amount mistakenly included the $1.5 million cost to develop the proprietary database he hacked into and, consequently, the sentencing range was too high. The Tenth Circuit, without determining whether the loss calculation was improper, held that any perceived error was harmless because the district court unequivocally stated it would still impose a 30-month sentence even under a lower guideline range. The Tenth Circuit affirmed.

Extended Summary:

Since 2005, Onyx, M.D., Inc., a physician-staffing agency, developed a proprietary database. Defendant was a former employee who, a year after being terminated, obtained an executive's password and copied information out of the database to help him compete with Onyx. Defendant also intercepted over 20,000 emails to and from four Onyx executives. Onyx eventually noticed the hack, which the FBI traced to Defendant's address. Defendant pleaded guilty to unlawfully obtaining information from a protected computer and to unlawfully intercepting emails.

At sentencing, the district court determined that Onyx's losses were 1) $25,000 monetary harm in responding to the hack, and 2) $1.5 million in costs to develop the database. This resulted in a 16-level increase and guideline range of 41-51 months.

Defendant argued that the proper loss amount was $25,000, which would call for a 4-level increase and guideline range of 8-14 months. The district court disagreed and varied downward to impose a 30-month sentence, stating that even under a lower range it would impose a 30-month sentence with an upward variance. Defendant appealed.

First, the Tenth Circuit considered whether the district court properly calculated Onyx's losses. The Tenth Circuit looked to the guidelines commentary, which defined actual loss as the reasonably foreseeable pecuniary harm (meaning monetary harm) resulting from the offense. See USSG § 2B1.1 cmt. n.3(A)(i), (iii).

The Tenth Circuit held that the $1.5 million development cost was not adequately tied to any actual loss suffered by Onyx. Interpreting the commentary to require a district court to not only take into account the cost of developing trade secrets, but to substitute the development cost for the loss calculation contradicts the guideline's emphasis on actual losses. Without explicitly reversing, the Tenth Circuit stated its reluctance to affirm the offense level and corresponding guideline range.

Second, the Tenth Circuit held that any alleged error in the loss calculation was harmless. In the rare situation where there is harmless error in the loss calculation, it is because the error did not affect the sentence imposed by the district court. See U.S. v. Glover, 413 F.3d 1206, 1210 (10th Cir.2005). Here, the sentence was not affected because the district court clearly expressed that it would impose a 30-month sentence as an upward variance even if the correct range was lower.

Moreover, the Tenth Circuit held that the district court properly gave more than a boiler plate or perfunctory explanation for why it would exercise an upward variance. See U.S. v. Pena-Hermosillo, 522 F.3d 1108, 1117-18 (10th Cir.2008). The court relied on specific factors from 18 U.S.C. § 3553(a). Since the district court is not otherwise required to sentence within the guideline range, see U.S. v. Booker, 543 U.S. 220 (2005), a remand was inappropriate. The Tenth Circuit held that any error was harmless and affirmed the district court's sentence.

To read the full opinion, please visit: https://www.ca10.uscourts.gov/opinions/15/15-1107.pdf

Panel: Tymkovich, Hartz, and Baldock

Date of Issued Opinion: November 27, 2015

Docket Number: No. 15-1107

Decided: The Tenth Circuit affirmed the sentence imposed by the district court.

Case Alert Author: Veronica C. Gonzales

Counsel:

O. Dean Sanderford, Assistant Federal Public Defender (Virginia L. Grady, Federal Public Defender, with him on the briefs), Denver, Colorado, for Defendant - Appellant.

Paul Farley, Assistant United States Attorney (John F. Walsh, United States Attorney, with him on the brief), Denver, Colorado, for Plaintiff - Appellee.

Author of Opinion: Hon. Harris L. Hartz

Case Alert Circuit Supervisor: Dawinder S. Sidhu

    Posted By: Veronica Gonzales @ 02/12/2016 12:02 AM     1st Circuit     Comments (0)  

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