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March 24, 2017
  Heyer v. U.S. Bureau of Prisons -- Fourth Circuit
No ASL Interpreter, No Videophone: Deaf Prisoner Wins First and Fifth Amendment Claims

Areas of Law: First Amendment, Fifth Amendment

Issue Presented: Whether the district court erred in granting summary judgment to the defendant on the plaintiff's Fifth Amendment claims for failure to provide ASL interpreters for medical appointments and the mental health treatment in the Commitment and Treatment Program and on the plaintiff's First Amendment claim for failure to provide access to a videophone.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that the district court erred in granting summary judgment in favor of the defendant on the plaintiff's First and Fifth Amendment claims. First, the defendant's failure to provide ASL interpreters for the plaintiff's medical appointments amounted to deliberate indifference to his medical needs in violation of the Fifth Amendment. Second, the defendant's post-litigation decision to provide interpreters for some aspects of Heyer's treatment in the Commitment and Treatment Program provides no basis for rejecting Heyer's Fifth Amendment claim on the merits. Third, the defendant's failure to provide the plaintiff with access to a videophone improperly restricts his First Amendment rights to communicate with those outside the prison. Therefore, the Fourth Circuit vacated the district court's order in part and remanded for further proceedings.

Extended Summary: Thomas Heyer ("Heyer") is a deaf individual, who communicates primarily through American Sign Language ("ASL") and has extremely limited proficiency in spoken or written English. Heyer was previously convicted of possessing child pornography. In December 2008, the government filed a petition seeking to detain Heyer under the Adam Walsh Child Protection and Safety Act (the "Adam Walsh Act"). Since the filing, Heyer has remained in civil custody at the federal correctional institution in Butner, North Carolina. After a hearing on the petition in March 2012, the district court ordered Heyer detained as a sexually dangerous person.

Under the Adam Walsh Act, Heyer will remain in civil custody until such time as the government determines that his "condition is such that he is no longer sexually dangerous to others, or will not be sexually dangerous to others if released under a prescribed regimen of medical, psychiatric, or psychological care or treatment." 18 U.S.C. § 4248(e). Adam Walsh Act detainees at Butner are expected to participate in the "Commitment and Treatment Program" (the "CT Program"), which includes mental health treatment in group and individual settings and other activities. Heyer began participating in the CT Program in July 2012.

Since December 2008, Heyer has made multiple requests for ASL interpreters. The prison officials refused to provide qualified interpreters for any purpose, including scheduled medical appointments and medical emergencies, until late 2012. Heyer has had multiple seizures during his time at Butner. In 2010, the prison officials assigned another inmate, who does not know ASL, to act as Heyer's "inmate companion person" to help Heyer communicate with others. The prison officials also required Heyer to rely on this "companion" during medical interactions. As to the CT Program, the prison officials concluded that Heyer's inmate companion would be "inadequate" to facilitate Heyer's participation, but did not provide Heyer with ASL interpreters for the CT Program until September 2012.

In 2011, Heyer filed a lawsuit against the United States Bureau of Prisons ("BOP"). Heyer alleged, among other claims, that (1) the BOP violated Heyer's Fifth Amendment rights by failing to provide ASL interpreters for medical appointments and for the mental health treatment provided through the CT Program, and (2) the BOP violated Heyer's First Amendment rights by failing to provide access to a videophone. The district court granted summary judgment in favor of BOP on the claims.

With respect to his first Fifth Amendment claim, Heyer contended that he, a civil detainee, is entitled under the Fifth Amendment to at least the same protection prisoners receive under the Eighth Amendment. As deliberate indifference to serious medical needs of prisoners constitutes the unnecessary and wanton infliction of pain proscribed by the Eighth Amendment, Heyer argued that the failure to provide ASL interpreters amounted to deliberate indifference to his medical needs and thus violated his Fifth Amendment rights.

The Fourth Circuit agreed and held that Heyer's evidence was sufficient to support a finding of deliberate indifference. The deliberate indifference standard has two components: the plaintiff must show (1) that he had serious medical needs, and (2) that the defendant acted with deliberate indifference to those needs. See Iko v. Shreve, 535 F.3d 225, 241 (4th Cir. 2008). First, the Fourth Circuit found that Heyer, who suffered multiple seizures during his confinement, had serious medical needs. In addition, citing Farmer v. Brennan, 511 U.S. 825, 837 (1994), the court found that the absence of ASL interpreters during medical appointments exposed Heyer to "a substantial risk of serious harm." Second, the Fourth Circuit found that BOP acted with deliberate indifference to those needs by knowing Heyer's deafness since his arrival at Butner in 2008, knowing his need for an ASL interpreter for communication and treatment, knowing his inmate companion was inadequate to ensure understanding, and disregarding his requests for ASL interpreters. Thus, the Fourth Circuit concluded that the district court erred in granting summary judgment in favor of the BOP on the first Fifth Amendment claim.

With respect to his second Fifth Amendment claim, Heyer contended that BOP failed to provide ASL interpreters for the mental health treatment in the CT Program. The district court granted summary judgment for BOP, explaining that BOP had agreed to provide ASL interpreters for Heyer's participation in most aspects of the CT Program. The Fourth Circuit disagreed.

The Fourth Circuit observed that Heyer sought a court ruling that, because the length of his confinement is dependent in large part on BOP's assessment of his mental health, BOP is constitutionally obliged to provide interpreters for all aspects of the mental-health treatment it offers to Adam Walsh Act detainees. Heyer also sought an injunction ordering BOP to provide the necessary interpreters. Thus, the court held that BOP's post-litigation decision to provide interpreters for some aspects of Heyer's treatment clearly provided no basis for rejecting Heyer's claim on the merits. Accordingly, the court concluded that the district court erred by granting summary judgment in favor of BOP on this claim as well.

With respect to his First Amendment claim, Heyer contended that BOP's failure to provide him with access to a videophone improperly restricted his First Amendment right to communicate with those outside the prison. The Fourth Circuit agreed. In Turner v. Safley, 482 U.S. 78 (1987), the Supreme Court concluded that a prison policy or regulation that "impinges on inmates' constitutional rights . . . is valid if it is reasonably related to legitimate penological interests," and the Court identified four factors to consider when determining the reasonableness of the policy.

To start with, the Fourth Circuit held that BOP's TTY-only policy did impinge on Heyer's First Amendment rights. The court found that Heyer cannot effectively communicate through the TTY device because it requires proficiency in written English, in which Heyer does not possess.

The Fourth Circuit then determined whether that policy "is reasonably related to legitimate penological interests" based on the four-factor test in Turner. In discussing the first factor, the Fourth Circuit found that there is not a "valid, rational connection between the prison regulation and the legitimate governmental interest put forward to justify it." Although BOP argued that its TTY-only policy furthered its legitimate interest in maintaining prison security and that videophone conversations must go through its secure Inmate Telephone System, the Fourth Circuit noted that the TTY system currently in place operates on an unsecured line in a private staff office. Also, as to whether monitoring of a videophone conversation would be more demanding of staff time than the monitoring of the TTY conversations that is already being done, the Fourth Circuit held that the fact finder could question whether a videophone system would in fact present the difficulties asserted by BOP.

Second, the Fourth Circuit held that Heyer has no alternate effective means of communication. Although BOP argued that alternative means of communicating (TTY, emails, written letters, and in-person visits) with those outside Butner were available to Heyer, the Fourth Circuit found all (except in-person visitation) involve the use of written English, in which Heyer has extremely limited proficiency. In addition, the court found that the availability of in-person visitation is of little help in emergencies or other situations where there is a need for immediate contact.

Third, the Fourth Circuit held that accommodating Heyer's needs would have a minimal effect on guards or other inmates or on the prison's allocation of resources. The court found that it was questionable that a videophone would require creation of a new, secure IT infrastructure, as BOP claimed. Moreover, nothing in the record indicated why a system-wide solution, as BOP claimed, would be required.

Finally, the Fourth Circuit found that there is a "ready alternative" to the challenged policy. Given Heyer's evidence of the minimal cost of a videophone and the ease with which security concerns could be mitigated, the court held that a fact finder could reasonably conclude that BOP's refusal to provide a videophone is an exaggerated response to the perceived security concerns. Accordingly, the Fourth Circuit concluded that the district court erred by granting summary judgment to BOP on the First Amendment claim.

To read the full opinion, click here.

Panel: Judges Motz, Traxler, and Floyd

Argument Date: 10/26/2016

Date of Issued Opinion: 02/23/2017

Docket Number: No. 15-6826

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

Case Alert Author: Maria Nazarova, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Ian S. Hoffman, ARNOLD & PORTER LLP, Washington, D.C., for Appellant. Robert J. Dodson, OFFICE OF THE UNITED STATES ATTORNEY, Raleigh, North Carolina, for Appellees. ON BRIEF: Deborah Golden, Elliot Mincberg, WASHINGTON LAWYERS' COMMITTEE FOR CIVIL RIGHTS & URBAN AFFAIRS, Washington, D.C.; David B. Bergman, ARNOLD & PORTER LLP, Washington, D.C., for Appellant. John Stuart Bruce, Acting United States Attorney, Jennifer P. May-Parker, Jennifer D. Dannels, Assistant United States Attorneys, OFFICE OF THE UNITED STATES ATTORNEY, Raleigh, North Carolina, for Appellees. Marc Charmatz, Howard A. Rosenblum, Debra Patkin, NATIONAL ASSOCIATION OF THE DEAF, Silver Spring, Maryland, for Amicus Curiae.

Author of Opinion: Circuit Judge Traxler

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/24/2017 03:48 PM     4th Circuit     Comments (0)  

March 20, 2017
  Sixth Circuit: nondisclosure of State's payment to key witness violates due process
Headline: Prosecution's nondisclosure of witness's payment for testimony violates defendant's due-process rights under Brady v. Maryland.

Case: Thomas v. Westbrooks

Area of law: Criminal procedure, constitutional law, due process.

Issue presented: Whether the state violated the defendant's right to due process under Brady v. Maryland when the prosecutor suppressed evidence that the key witness had received payment for her testimony.

Brief summary: The state's key witness in Thomas's murder trial received $750 for her testimony. The prosecution failed to disclose this evidence during trial and failed to correct on the record the witness's false testimony that she did not receive any payment. Thomas argued that this violated his due-process rights under Brady, which prohibits the state from suppressing material evidence that is favorable to the defendant. The Sixth Circuit found that the evidence of the witness's payment was material under the circumstances. It reasoned that a large payment made in direct connection to the case in which the witness is testifying presents a pecuniary bias that is likely to weigh heavily on a juror's assessment of the witness's credibility. The Court also emphasized that the focus with a Brady claim is not on whether the other evidence at trial was sufficient to convict the defendant, but whether suppression of this evidence made the defendant's trial fundamentally unfair.

Extended summary: In 1997, Thomas shot and robbed an armored-truck driver. A federal court convicted Thomas of interfering with interstate commerce and other firearm-related crimes, sentencing him to life in prison. After the truck driver died of his injuries, the State of Tennessee charged him with felony murder. A jury convicted him and sentenced him to death.

The key witness at both trials was Angela Jackson, who was Thomas's girlfriend at the time of the crime. Before the murder trial began, the FBI paid Jackson $750 as a reward for her testimony. Her receipt of this payment was noted in the files that federal authorities gave state prosecutors to use in their case.

The state prosecutor did not inform Thomas of this payment. On the contrary, the prosecutor continuously emphasized during the murder trial that Jackson was testifying because she believed it was the "'the right thing to do.'" The prosecutor also failed to correct Jackson on the record when she twice perjured herself by testifying that she didn't receive any money in exchange for her testimony.

On appeal, Thomas claimed that the state's nondisclosure of Jackson's payments violated his due-process rights established in the U.S. Supreme Court case Brady v. Maryland. Brady held that a prosecutor's suppression of evidence violates a defendant's due-process rights if (1) the evidence is favorable to the defendant, (2) the evidence is either intentionally or accidentally suppressed by the state, and (3) the suppression results in prejudice to the defendant. The state conceded that the first two Brady elements were met, leaving only the question of prejudice.

Under the Brady test, prejudice results when the suppressed evidence is material, even if that evidence is only relevant for impeachment purposes. Evidence is material when, considering all relevant evidence, the suppressed evidence deprived the defendant of a fair trial with a trustworthy verdict. A defendant's burden for meeting this standard is between a mere possibility and a preponderance of the evidence that disclosure of the suppressed evidence would have resulted in an acquittal.

The Sixth Circuit held that evidence of Jackson's payment was material under the circumstances. The Court reasoned that this case was factually similar to a previous Sixth Circuit case, Robinson v. Mills, where the prosecution's key witness had previously received $70 for being a confidential informant - all, however, for cases that had nothing to do with the defendant's. Nonetheless, the Court held that the prosecution's failure to disclose these facts warranted relief under Brady because it revealed a potential bias relevant to the witness's credibility and truthfulness. Applying Robinson, the Sixth Circuit found that the $750 payment to witness Angela Jackson for testifying against Thomas was certainly material if the $70 payment in Robinson for past informant services was material.

The state argued that there was sufficient evidence to convict Thomas without Jackson's testimony, making anything related to her testimony, like the fact that she received payment, immaterial. But the Court reiterated that a Brady claim is meant to protect a defendant's right to a fair trial; therefore, the focus is not on whether the defendant could have been convicted if the suppressed evidence had been presented, but whether the suppression of the evidence made the defendant's trial fundamentally unfair. Furthermore, the Court rejected the state's factual argument that Jackson's testimony did not weigh heavily on the jury's decision to convict Thomas. Jackson provided credible testimony on key aspects of the prosecution's case, such as placing Thomas at the crime scene and linking him to the driver of the getaway car used after the robbery.

The state also argued that the defense had been able to effectively impeach Jackson on her inconsistent statements and her own past bad acts, and therefore evidence of her payment was immaterial. The Court, however, stressed the difference between impeachment based on pecuniary bias and impeachment based on other grounds. The Court found that jurors are more likely to distrust witnesses whose testimony is linked to a financial gain.

Since the Court found that Thomas was entitled to relief on his Brady claim, the Court found it unnecessary to determine whether the prosecutor engaged in prosecutorial misconduct for failing to correct Jackson's perjurious testimony that she never received a payment in exchange for her participation.

Panel: Circuit Judges Gilbert S. Merritt, Eugene E. Siler, Jr., and Bernice B. Donald.

Date of issued opinion: February 24, 2017

Docket number: 15-5399

Decided: Reversed and remanded.

Counsel: Robert L. Hutton, GLANKLER BROWN, PLLC, Memphis, Tennessee, for Appellant. Michael M. Stahl, OFFICE OF THE TENNESSEE ATTORNEY GENERAL, Nashville, Tennessee, for Appellee. ON BRIEF: Robert L. Hutton, GLANKLER BROWN, PLLC, Memphis, Tennessee, Kevin Wallace, Elizabeth Cate, Mollie Richardson, WINSTON & STRAWN LLP, New York, New York, for Appellant. Michael M. Stahl, OFFICE OF THE TENNESSEE ATTORNEY GENERAL, Nashville, Tennessee, for Appellee. Mark A. Fulks, BAKER DONELSON BEARMAN CALDWELL & BERKOWTIZ, P.C., Johnson City, Tennessee, for Amicus Curiae.

Author of opinion: Circuit Judge Gilbert S. Merritt.

Case alert author: Andrea Randall, Western Michigan University Cooley Law School

Case alert circuit supervisor: Professor Mark Cooney

Link to the case: http://www.opn.ca6.uscourts.go...ns.pdf/17a0045p-06.pdf

Edited: 03/23/2017 at 12:42 PM by Mark Cooney

    Posted By: Mark Cooney @ 03/20/2017 11:52 AM     6th Circuit     Comments (0)  

March 19, 2017
  Gil v. Sessions - Second Circuit
Headline: Second Circuit denies petition to review Board of Immigration Appeals decision denying claim of derivative citizenship

Area of Law: Immigration Law

Issue Presented: Whether the petitioner, who was born out of wedlock in the Dominican Republic to two Dominican citizens, could claim derivative citizenship as a legitimized "child" of his naturalized father under the Immigration and Nationality Act.

Brief Summary: The petitioner was born in the Dominican Republic to unwed Dominican citizens. He petitioned for review of a Board of Immigration Appeals ("BIA") decision that found him ineligible for derivative citizenship through his naturalized father and, accordingly denied his motion to terminate removal proceedings initiated based upon his two prior convictions. To be a "child" eligible for derivative citizenship under § 101(c)(1) of the Immigration and Nationality Act, an individual born out of wedlock must be "legitimated" under the Act by the age of 16. The Second Circuit affirmed the findings of the BIA and held that petitioner failed to gain legitimated status under Dominican or New York law before he turned 16 years old and, therefore, was not eligible for derivative citizenship.

To read the full opinion, visit:
http://www.ca2.uscourts.gov/de...52cfa3ec46d/1/hilite/

Extended Summary: Gil was born in the Dominican Republic in 1968. His parents, unwed, were both Dominican citizens. In 1978, at nine years old, Gil came to the United States to live with his father as a lawful permanent resident. His father became a naturalized United States citizen in November 1980 when Gil was 11 years old and Gil received a Certificate of Citizenship at this time on the basis that he derived citizenship as a result of his father's naturalization. Gil was convicted of first-degree robbery in 1987 and of a controlled substance offense in federal court in 1995.

Thereafter, in 2010, the United States Citizenship and Immigration Services determined that Gil's Certificate of Citizenship was unlawfully or fraudulently obtained because he was not a qualifying "child" under the Immigration and Nationality ("INA") requirement for derivative citizenship. His Certificate of Citizenship was therefore cancelled and the Department of Homeland Security instituted removal proceedings against Gil based upon his prior convictions.
On November 18, 2013, an Immigration Judge ("IJ") rejected Gil's motion to terminate the removal proceedings based upon a claim of derivative citizenship, finding Gil was not "legitimate" under Dominican or New York law before reaching the age of sixteen as specified in the INA. The Board of Immigration Appeals (BIA) affirmed the IJ's ruling and Gil petitioned the Second Circuit for review of the BIA decision.

The INA § 321(a) addresses when a "child" born outside of the United States to alien parents may become a United States citizen through derivative citizenship. INA § 101(c)(1) then defines a "child" under the Act as "includ[ing] a child legitimated under the law of the child's residence or domicile, or under the law of the father's residence or domicile if such legitimation . . . takes place before the child reaches the age of 16 years . . . and the child is in the legal custody of the legitimating . . . parent . . . at the time of such legitimation." 8 U.S.C. § 101(c)(1). While not defined in the Act, the BIA has interpreted "legitimated" to refer to a child born out of wedlock who has been accorded legal rights that are identical to those enjoyed by a child born in wedlock. The issue of this case turned on whether, before Gil turned 16 years old, Dominican or New York had eliminated all legal distinctions between children born in and out of wedlock.

The Second Circuit ruled that Gil had not "legitimated" by the time he was 16 years old under Dominican law. A law was enacted in 1994 that changed Dominican law to eliminate all legal distinctions between children born in wedlock and those born out of wedlock, however Gil was 26 years old when this law took effect and therefore, the court found, was not a legitimated child by the age of 16 as required by the Act. The Second Circuit further ruled that Gil was not a legitimated child under New York law finding that New York law distinguishes between children born in and out of wedlock for inheritance purposes, citing to N.Y. Est. Powers & Trusts Law § 4-1.2(b) (McKinney 2010). Concluding Gil did not "legitimate" by the age of 16 years old under Dominican or New York law, and accordingly was not a "child" under § 101(c)(1) of the INA. the Second Circuit agreed with that he was not eligible for derivative citizenship through his father's naturalization. Accordingly, the Second Circuit denied Gil's petition for review of the BIA's decision that rejected his claim of derivative citizenship and denied his motion to terminate his removal proceedings.

To read the full opinion, visit,
http://www.ca2.uscourts.gov/de...52cfa3ec46d/1/hilite/

Panel: Circuit Judges Walker, Hall, and Chin

Argument Date: 10/31/2016

Date of Issued Opinion: 3/17/2017

Docket Number: 15-3134-ag

Decided: Petition Denied

Case Alert Author: Leigh G. Wellington

Counsel: Joshua E. Bardavid, New York, New York for Petitioner; Lisa M. Damiano, Trial Attorney, Terri J. Scadron, Assistant Director, Office of Immigration Litigation, Benjamin C. Mizer, Principal Deputy Assistant Attorney General, Civil Division, United States Department of Justice, Washington, D.C. for Respondent.

Author of Opinion: Circuit Judge Chin

Case Alert Circuit Supervisor: Professor Elyse Diamond

    Posted By: Elyse Diamond @ 03/19/2017 11:33 AM     2nd Circuit     Comments (0)  

March 16, 2017
  Beck v. McDonald -- Fourth Circuit
"That Alone Is Not Enough" -- Fourth Circuit Takes Stand on Standing in Data Breach Case

Areas of Law: Civil Procedure, Constitutional Law

Issue Presented: Whether a plaintiff can establish an Article III injury-in-fact based on an increased risk of identity theft.

Brief Summary: In consolidated appeals from two class action suits alleging injury from a data breach, the United States Court of Appeals for the Fourth Circuit affirmed the dismissal of the cases for lack of subject matter jurisdiction. The Plaintiffs alleged they had been harmed by the William Jennings Bryan Dorn Veterans Affairs Medical Center's ("Dorn VAMC") loss of a laptop and files containing patients' medical records and personal information. The court found the alleged harm was too speculative and hypothetical to establish the "certainly impending" injury-in-fact that is required for standing. The Fourth Circuit also rejected the Plaintiffs' argument that standing existed based on the "substantial risk" that harm will occur as a result of the data breach. With regard to this argument, the court refused to infer that such a risk existed when an organization offers remedial free credit monitoring services.

Extended Summary: This case arose from consolidated appeals from two class actions (Beck v. McDonald and Watson v. McDonald) filed by veterans who received medical treatment and health care at the Dorn VAMC. The Plaintiffs sought money damages and declaratory and injunctive relief under the Privacy Act of 1974 ("Privacy Act") and the Administrative Procedures Act ("APA").

In both cases, the Plaintiffs attempted to establish standing and sufficient injury-in-fact based on the potential damages that could arise from the VAMC's loss of information. In the first class action suit, filed by Richard Beck and Lakreshia Jeffery, the Plaintiff's claims were based on the loss of a laptop computer containing unencrypted, confidential patient information of 7,400 patients. While the Beck litigation was still pending, Beverly Watson brought a class action lawsuit on behalf of the over 2000 individuals whose medical files were lost or stolen while being transported to a long term storage facility. The laptop contained patient's names, birth dates, the last four digits of social security numbers and physical descriptions. The files contained patient's names, full social security numbers, and medical diagnoses. Both the computer and the files have never been recovered and all parties affected by the loss of the data were offered one year of free credit monitoring.

In both cases, the Plaintiffs attempted to establish standing and injury-in-fact by arguing that the loss of information by the Dorn VAMC violated the Privacy Act, and caused Plaintiffs "embarrassment, inconvenience, unfairness, mental distress, and the threat of current and future substantial harm from identity theft and other misuse." Additionally, Plaintiffs argued that the risk of identity theft required them to frequently monitor their credit reports, bank statements, health insurance reports, purchase credit watch services, and shift financial accounts.

In Beck, the district court denied the Defendant's' initial motion to dismiss so the Plaintiff could conduct discovery. After discovery concluded, the Defendants again made a motion to dismiss, which was granted. In granting the motion, the district court found that the Plaintiffs had not submitted enough evidence to establish an issue of material fact that they faced a "certainly impending" risk of identity theft. In Watson, the district court did not even allow for discovery, and granted the Defendant's motion to dismiss.

On appeal, the United States Court of Appeals for the Fourth Circuit affirmed the dismissal of both cases for lack of subject matter jurisdiction. The court held that the Plaintiffs' alleged harm was too speculative and hypothetical to establish "certainly impending" injury-in-fact. In dismissing both cases, the Fourth Circuit noted that in other circuits where plaintiffs can establish injury-in-fact based on an increased risk of future identity theft, the plaintiff also alleged that "the data thief intentionally targeted the personal information comprised in the data breaches."

The Fourth Circuit also rejected the Plaintiffs' argument that they had standing based on a "substantial risk" that harm will occur. The Plaintiffs argued there was a substantial risk that harm would occur because generally 33% of health related data breaches result in identity theft. The Fourth Circuit, however, found that if that general point was true, than 66% of the veterans impacted by the breach would suffer no harm at all. The Fourth Circuit also declined to infer a substantial risk of harm exists if an organization offers free credit monitoring services, because that inference would discourage organizations from offering assistance. Finally, the Fourth Circuit found that the Plaintiffs did not suffer an injury-in-fact because they incurred a cost to protect against speculative threat because "self-imposed harms can not confer standing."

Finally, in denying the Plaintiffs injunctive relief request, the Fourth Circuit found that the Plaintiffs did not have standing under the APA. This was because allegations of the Dorn VAMC's past Privacy Act violations only demonstrated that the Plaintiffs could be victimized by a future data breach, not that there is an immediate danger that they will be victimized by a future data breach.

To read the full opinion, click here.

Panel: Judges Niemeyer and Diaz, and District Judge Keeley

Argument Date: 9/20/2016

Date of Issued Opinion: 2/6/2017

Docket Numbers: No. 15-1395

Decided: Affirmed by published opinion

Case Alert Author: Fernando Kirkman, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Douglas J. Rosinski, Columbia, South Carolina, for Appellants. Sonia Katherine McNeil, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellees. ON BRIEF: D. Michael Kelly, Bradley D. Hewett, MIKE KELLY LAW GROUP, LLC, Columbia, South Carolina, for Appellants. Benjamin C. Mizer, Principal Deputy Assistant Attorney General, Mark B. Stern, Civil Division, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C.; William N. Nettles, United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Columbia, South Carolina, for Appellees.

Author of Opinion: Judge Diaz

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/16/2017 01:40 PM     4th Circuit     Comments (0)  

March 14, 2017
  Iraq Middle Market Development Foundation v. Harmoosh, et al. - Fourth Circuit
Fourth Circuit Applies Basic Contractual Right to Claim for Recognition of Foreign Civil Judgment

Areas of Law: Contracts

Issue Presented: Whether the Maryland Recognition Act's arbitration clause exception applies if a party forgoes the right to arbitrate by participating in judicial proceedings in a foreign court.

Brief Summary: In a published opinion, the Fourth Circuit vacated the grant of summary judgment in favor of the appellee and remanded the case to the United States District Court for the District of Maryland. In a lawsuit brought by the appellant-creditor to recognize a civil judgment against the appellee-debtor from an Iraqi court, the district court granted a motion for summary judgment upon the appellee's invocation of an arbitration clause in the loan agreement. Upon appeal of this ruling, the Fourth Circuit held there was still a genuine issue of material fact as to whether the appellee voluntarily waived the arbitration clause during judicial proceedings in the Iraqi court. Because the Fourth Circuit found that such a voluntary waiver in a foreign court is not contrary to the disputed arbitration clause for the purposes of the Maryland Recognition Act, the appellee was not entitled to summary judgment by the district court.

Extended Summary: The appellant, Iraq Middle Market Development Foundation, is a non-profit corporation that makes and services loans to businesses in Iraq. In 2006, Iraq Middle Market agreed to lend $2 million to Jawad Al-Harmoosh for his company, AGTTT. A managing partner at AGTTT, Mohammad Harmoosh, signed a promissory note guaranteeing repayment of the loan. Harmoosh is a dual citizen of Iraq and the United States, and lives in Maryland. The loan agreement contained an arbitration clause which required that all legal disputes be "finally and exclusively settled by arbitration."

In 2010, Iraq Middle Market sued the appellees in federal court in Maryland for breach of contract after the appellees refused to repay the loan. The appellees moved to dismiss the claim by invoking the loan agreement's arbitration clause. The district court dismissed the suit, but thereafter the appellees did not move to compel arbitration. Subsequently, in 2014, the appellant filed another civil action against the appellees to collect on the promissory note. This time, the appellant did so in an Iraqi court. The appellees asserted multiple affirmative defenses, but the parties disagreed as to whether they ever raised the arbitration clause in that proceeding. Although invocation of an arbitration clause would have deprived the Iraqi court of jurisdiction, the suit was litigated on the merits through final judgment. The Iraqi court found in favor of the appellant and awarded $2 million in damages. That judgment was subsequently affirmed by two appellate courts in Iraq.

Upon that decision, appellant brought the present complaint seeking recognition of the Iraqi judgment under the Maryland Uniform Foreign Money-Judgments Recognition Act. Under that act, a foreign judgment regarding a sum of money is generally conclusive between the parties if it is "final, conclusive, and enforceable where rendered." Md. Code, Courts and Judicial Proceedings, § 10-702 & 10-703. However, the act does recognize exceptions to this general rule, including if "the proceeding in the foreign court was contrary to an agreement between the parties under which the dispute was to be settled out of court." Md. Code, Courts and Judicial Proceedings, § 10-704(b)(4). The appellee invoked this statutory exception in a motion for summary judgment, which the district court granted because, in the court's view, the Iraqi judgment was "contrary to an arbitration provision."

The Fourth Circuit reviewed the grant of summary judgment de novo and first examined whether the disputed exception applies if a party forgoes its right to arbitrate by participating in judicial proceedings in a foreign court. This issue is a question of state law that had not yet been addressed by the Maryland Court of Appeals. Therefore, because the federal court had diversity jurisdiction over the case, its role was "to anticipate how [Maryland's highest court] would rule on this question."

The appellee contended that this exception permits courts to decline recognition of a foreign judgment if the dispute should not have been litigated at all under the terms of an arbitration clause. The Fourth Circuit found this argument to be overly broad. The court did not believe the state legislature would have intended for courts to enforce contractual rights the parties had waived or resolved in front of a foreign court. The Fourth Circuit had not addressed this issue before, but those courts that had considered similar provisions recognized that parties may waive such exceptions. Furthermore, the parallel federal act on recognition of foreign judgments, largely adopted by Maryland in creating the act at issue herein, allowed for either express or implied waiver of out-of-court remedies. The Fourth Circuit also found that appellee's argument was at odds with Maryland's common law of contracts, in which arbitration clauses can be waived the same as any other contractual right. Finally, the Fourth Circuit felt that appellee's arguments would frustrate the purpose of the Maryland Recognition Act, specifically international comity and mutual recognition of foreign judgments.

Therefore, the Fourth Circuit held that "judicial proceedings in a foreign court are not 'contrary to' an arbitration clause for the purposes of the Maryland Recognition Act if the parties choose to forego their rights to arbitrate by participating in those proceedings." In that event, the Fourth Circuit held that the exception invoked by the appellee simply would not apply.

With that new rule in mind, the Fourth Circuit considered whether the appellant had raised genuine issues of material fact on the issue of appellee's waiver of his arbitration rights. In this instance, waiver occurred only if appellee "so substantially utilize[d] the litigation machinery that to subsequently permit arbitration would prejudice" the appellant. Appellee did not dispute that appellant would lose entitlement to recover on a $2 million judgment if the appellee were allowed to assert the right to arbitrate.

The Fourth Circuit found that the appellant introduced sufficient evidence to preclude summary judgment. Specifically, the appellant showed that the appellee was aware of the right to arbitrate, as he had raised it in defense of the first lawsuit in Maryland, but still voluntarily litigated the dispute in Iraq. Both sides introduced conflicting evidence as to whether the issue of the arbitration clause was ever raised as a defense in the Iraqi court proceedings. Consequently, the Fourth Circuit found there were still genuine issues of material fact as to whether the appellee waived his right to arbitrate. Therefore, the appellee was not entitled to summary judgment and that grant was vacated, with the case remanded to the district court to resolve the factual questions still at issue in the case.

To read full opinion, click here.

Panel: Judges Wilkinson, Motz, and Floyd

Argument Date: 12/7/2016

Date of Issued Opinion: 2/2/2017

Docket Number: No. 16-1403

Decided: Vacated and remanded by published opinion

Case Alert Author: Patrick J.L. Dillon, Univ. of Maryland Carey School of Law

Counsel: ARGUED: D. Michelle Douglas, KALBIAN & HAGERTY, LLP, Washington, D.C., for Appellant. Mukti N. Patel, FISHERBROYLES LLP, Princeton, New Jersey, for Appellees. ON BRIEF: Haig V. Kalbian, KALBIAN & HAGERTY, LLP, Washington, D.C., for Appellant.

Author of Opinion: Judge Motz

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/14/2017 01:20 PM     4th Circuit     Comments (0)  

  United States v. Dozier -- Fourth Circuit
Fourth Circuit Joins Ninth Circuit in Adopting Two-Step Analysis to Find General Attempt Conviction Constitutes Controlled Substance Offense under Sentencing Guidelines

Areas of Law: Criminal Law, Sentencing Guidelines

Issue Presented: Whether a defendant's prior conviction for attempt to distribute a controlled substance under West Virginia law constitutes a "controlled substance offense" under U.S.S.G. § 4B1.2 for purposes of the career offender sentencing enhancement.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that the District Court erred in applying the modified categorical approach to determine whether the defendant's prior attempt conviction constituted a "controlled substance offense" for purposes of career offender sentencing. The Fourth Circuit explained that, under the categorical approach required by the U.S. Supreme Court in Mathis, a court must engage in two analyses: first, a court must determine whether the state's definition of "attempt" categorically comports with the generic definition of "attempt" as that term is used in the career-offender enhancement. Second, a court must determine whether the underlying state offense is a categorical match for the Guideline predicate offense. Applying this analysis, the Fourth Circuit nevertheless found that the District Court correctly concluded that the defendant's prior attempt conviction constituted a "controlled substance offense." Therefore, the Fourth Circuit affirmed the District Court's judgment.

Extended Summary: In 2015, Deshawn Dozier was charged with knowingly and intentionally distributing cocaine in violation of federal law. After Dozier entered his guilty plea, the probation officer provided the District Court with a presentence investigation report ("PSIR"), which recommended in part a career offender enhancement.

Dozier was designated a career offender due to two prior state convictions, which were categorized as "controlled substance offenses" under § 4B1.2 of the U.S. Sentencing Guidelines. Under § 4B1.2, a "controlled substance offense" includes the "attempt[] to commit such [an] offense[]." Dozier's second state conviction was a conviction for attempt to distribute a controlled substance under West Virginia law. Dozier objected to the categorization of his second conviction and his resulting career offender status. The District Court overruled Dozier's objection, holding that Dozier's attempt conviction constituted a "controlled substance offense" under a modified categorical approach. Thus, the District Court adopted the PSR's recommendation and imposed a sentence of 151-month imprisonment.

The Fourth Circuit first found that the District Court erred in applying the modified categorical approach to the West Virginia general attempt statute, reasoning that the statute is not divisible. Nevertheless, the Fourth Circuit held that the District Court correctly concluded that Dozier's prior attempt conviction constituted a "controlled substance offense" after analyzing the case under the proper categorical approach.

Citing United States v. Cabrera-Umanzor, 728 F.3d 347, 350 (4th Cir. 2013), Taylor v. United States, 495 U.S. 575, 602 (1990), and Mathis v. United States, 136 S. Ct. 2243, 2246 (2016), the Fourth Circuit explained that, when addressing whether a prior conviction triggers a Sentencing Guideline enhancement, the categorical approach focuses on the elements of the prior offense. For a prior conviction to qualify as a Guideline predicate offense, "the elements of the prior offense [must] 'correspond[] in substance' to the elements of the enumerated offense." Citing the Ninth Circuit decision in Rebilas v. Mukasey, 527 F.3d 783, 787 (9th Cir. 2007), the Fourth Circuit found that because Dozier was convicted under West Virginia's general attempt statute two sets of elements were at issue: the elements of attempt and the elements of the underlying attempted controlled substance offense.

Citing two Ninth Circuit decisions United States v. Gomez-Hernandez, 680 F.3d 1171, 1175 (9th Cir. 2012), and United States v. Gonzalez-Monterroso, 745 F.3d 1237, 1240 (9th Cir. 2014), the Fourth Circuit held that a court must engage in two related analyses to adhere to the "elements-only inquiry" required by Mathis. First, a court must determine whether the state's definition of "attempt" categorically comports with the generic definition of "attempt" as that term is used in the career-offender enhancement. Second, a court must determine whether the underlying state offense is a categorical match for the Guideline predicate offense.

First, the Fourth Circuit held that, under the Taylor categorical approach, West Virginia's attempt statute is a categorical match for the generic definition of "attempt." The Fourth Circuit's precedent defines "generic attempt" as requiring (1) culpable intent to commit the crime charged and (2) a substantial step towards the completion of the crime. West Virginia criminal law defines attempt as requiring "(1) a specific intent to commit the underlying substantive crime; and (2) an overt act toward the commission of that crime, which falls short of completing the underlying crime." After comparison, the Fourth Circuit found that the degree of intent required under West Virginia's general attempt statute is no broader than that required under the generic definition. The Fourth Circuit also found that the definition of an overt act under West Virginia law "corresponds in substance" to the generic definition of a substantial act.

Second, the Fourth Circuit held that the underlying offense is a categorical match for a generic "controlled substance offense." U.S.S.G. § 4B1.2(b) provides that a controlled substance offense is an offense that "prohibits the manufacture, import, export, distribution, or dispensing of a controlled substance (or a counterfeit substance) or the possession of a controlled substance (or a counterfeit substance) with intent to manufacture, import, export, distribute, or dispense." The underlying statutory offense at issue, West Virginia Code § 60A-4-401, provides "it is unlawful for any person to manufacture, deliver, or possess with intent to manufacture or deliver, a controlled substance." Accordingly, the Fourth Circuit found the act and related intent elements of § 60A-4-401(a) are no broader than those of the generic offense. In addition, both the controlled substance offense and Dozier's underlying attempted offense, i.e., distributing cocaine, are felonies punishable by imprisonment for a term exceeding one year.

Therefore, the Fourth Circuit concluded that Dozier's prior attempt conviction qualifies as a controlled substance offense, and Dozier was properly deemed a career offender under the Sentencing Guidelines. As a result, the Fourth Circuit affirmed the District Court's judgment.

To read the full opinion, click here.

Panel: Judges Shedd and Keenan, and Senior Judge Davis

Argument Date: 10/27/2016

Date of Issued Opinion: 01/30/2017

Docket Number: No. 15-4532

Decided: Affirmed by published opinion.

Case Alert Author: Maria Nazarova, Univ. of Maryland Carey School of Law

Counsel: Jonathan D. Byrne, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Charleston, West Virginia, for Appellant. Miller A. Bushong, III, OFFICE OF THE UNITED STATES ATTORNEY, Beckley, West Virginia, for Appellee. ON BRIEF: Christian M. Capece, Federal Public Defender, Rachel E. Zimarowski, Assistant Federal Public Defender, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Charleston, West Virginia, for Appellant. Carol A. Casto, Acting United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Charleston, West Virginia, for Appellee.

Author of Opinion: Senior Judge Davis

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/14/2017 12:58 PM     4th Circuit     Comments (0)  

  Sijapati v. Boente -- Fourth Circuit
Removability Statute: 5-Year Clock Resets Every Time a Non-Immigrant Leaves the United States

Areas of Law: Criminal Law, Immigration Law

Issue Presented: Whether the Fourth Circuit should accord Chevron deference to the Board of Immigration Appeals' interpretation of "the date of admission" under 8 U.S.C. § 1227(a)(2)(A)(i)(I) in Matter of Alyazji.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that the Board of Immigration Appeals' interpretation of "the date of admission" in Matter of Alyazji is entitled to Chevron deference. In Alyazji, "the date of admission" under 8 U.S.C. § 1227(a)(2)(A)(i)(I) was construed as the date of admission "by virtue of which an alien was in the United States at the time that he committed the crime involving moral turpitude." Thus, the Fourth Circuit found that the petitioner's second admission date was "the date of admission" for purposes of determining his removability. The Fourth Circuit affirmed the Board of Immigration Appeals' order.

Extended Summary: Ashish Sijapati, a native of Nepal, was admitted to the United States on a non-immigrant L-2 visa on January 25, 2001. On December 31, 2002, Sijapati departed the United States for a two-and-a-half-week vacation to Nepal. On January 18, 2003, Sijapati reentered the United States pursuant to his existing L-2 visa. On December 12, 2007, a circuit court in Virginia convicted Sijapati of felony embezzlement and imposed an eighteen-month suspended sentence.

Following Sijapati's conviction, the Department of Homeland Security ("DHS") instituted removal proceedings against Sijapati under 8 U.S.C. § 1227(a)(2)(A)(i)(I), alleging that Sijapati had been convicted of a crime involving moral turpitude within five years of the date of his admission. Sijapati filed a motion to terminate the removal proceedings against him, arguing that his embezzlement conviction did not render him removable.

The immigration court denied Sijapati's motion. The immigration court found that the Board of Immigration Appeals' ("BIA") decision in Matter of Alyazji controlled the determination of Sijapati's date of admission. In Alyazji, the BIA construed "the date of admission" as the date of "admission pursuant to which the alien was in the United States at the time that he committed the crime involving moral turpitude." Thus, the immigration court found that Sijapati's admission on January 18, 2003 was the date of admission for purposes of the statute. Accordingly, the immigration court declined to terminate Sijapati's removal proceedings but ordered that he be granted voluntary departure in lieu of removal. Sijapati appealed to the BIA, which, in its unpublished decision, affirmed the immigration court's determination. Sijapati then petitioned the Fourth Circuit for review of the BIA's order.

The Fourth Circuit denied the petition and affirmed the BIA's decision. According to Chevron U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837, 844 (1984), the BIA's interpretation of an ambiguous provision in the Immigration and Nationality Act ("INA") "must be given controlling weight unless th[at] interpretation[] [is] 'arbitrary, capricious, or manifestly contrary to the statute.'" ("Chevron deference"). However, because Chevron deference "is accorded only when an 'agency's interpretation is rendered in the exercise of [its] authority [to make rules carrying the force of law],'" the Fourth Circuit could not defer to the BIA's unpublished decision denying Sijapati's relief. Nevertheless, according to Hernandez v. Holder, 783 F.3d 189, 192 (4th Cir. 2015), when an unpublished decision lacking precedential weight relies on a precedential decision to which Chevron deference can apply that precedential decision controls "to the extent that 'Congress has not directly addressed the precise question at issue' and 'the [BIA]'s answer is based on a permissible construction of the statute.'"

Thus, to determine whether Alyazji's construction of "the date of admission" was entitled to deference, the Fourth Circuit applied this two-step inquiry. First, the court considered "whether Congress has directly spoken to the precise question at issue." If Congress' intent is clear, the court's inquiry comes to an end. If the statute is silent or ambiguous as to the specific issue, the court must then determine "whether the agency's answer is based on a permissible construction of the statute."

First, the Fourth Circuit held that the phrase "the date of admission" is ambiguous. Citing Ojo v. Lynch, 813 F.3d 533, 539 (4th Cir. 2016), the Fourth Circuit explained that when conducting the first inquiry, a court focuses "purely on statutory construction without according any weight to the agency's position." After looking at the plain language of the statute, the Fourth Circuit found that the INA is silent as to which admission should be used in determining an alien's removability under 8 U.S.C. § 1227(a)(2)(A)(i)(I), in the event an alien has multiple admissions, like Sijapati.

The Fourth Circuit continued to the second inquiry - whether Alyazji reasonably interpreted the meaning of "the date of admission." In Alyazji, concentrating on the statutory provision's "focus[] on admission plus presence," the BIA concluded that "the most natural reading of section 237(a)(2)(A)(i) is that the phrase 'the date of admission' refers to the date of admission by virtue of which the alien was present in the United States when he committed his crime." The Fourth Circuit found that Alyazji's construction was not arbitrary, capricious, or manifestly contrary to the statute for three reasons. First, the BIA followed the normal principles of statutory construction, considering the statute's "overall design" and "the language of the [moral turpitude] provision itself." Second, the BIA explained how its interpretation was informed by its own precedent and judicial constructions of the statute. Third, the BIA reasonably concluded that an alternative construction - treating the date of an alien's first admission as "the date of admission" - "is not reconcilable with the language and purpose of the statute."

In conclusion, the Fourth Circuit held that the BIA's interpretation of "the date of admission" in Alyazji was entitled to Chevron deference. The court concluded that Sijapati's second admission date (January 18, 2003) was the date of admission, and therefore he committed a crime involving moral turpitude within five years of his admission.

To read the full opinion, click here.

Panel: Judges Traxler, Keenan, and Wynn

Argument Date: 10/25/2016

Date of Issued Opinion: 02/01/2017

Docket Number: No. 15-1204, No. 15-1804

Decided: Petitions for review denied by published opinion

Case Alert Author: Ziyi He, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Benjamin Winograd, IMMIGRANT & REFUGEE APPELLATE CENTER, LLC, Alexandria, Virginia, for Petitioner. Laura Halliday Hickein, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Respondent. ON BRIEF: Irina Manelis, DYER IMMIGRATION LAW GROUP, P.C., Henrico, Virginia, for Petitioner. Benjamin C. Mizer, Principal Deputy Assistant Attorney General, Shelley R. Goad, Assistant Director, Office of Immigration Litigation, Civil Division, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Respondent

Author of Opinion: Circuit Judge Wynn

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/14/2017 12:38 PM     4th Circuit     Comments (0)  

  Birmingham v. PNC Bank -- Fourth Circuit
Homeowner Underwater and Out of Luck

Areas of Law: Bankruptcy Law, Statutory Interpretation

Issue Presented: Whether reference in the deed of trust to escrow funds, insurance proceeds, and miscellaneous proceeds constituted additional collateral for purposes of 11 U.S.C. § 1322(b)(2) such that the creditor was not entitled to protection against claim being crammed down.

Brief Summary: In a published opinion, the United States Court of Appeals for the Fourth Circuit held that the district court did not err in affirming the bankruptcy court's determination that PNC Bank, the creditor, was entitled to protection from having its claim crammed down. The Fourth Circuit found that PNC Bank's loan was secured solely by debtor Birmingham's principal residence, and not by any additional collateral. Therefore, PNC Bank was entitled to 11 U.S.C. § 1322(b)(2)'s anti-modification protection of its claim against Birmingham.

Extended Summary: On May 23, 2014, Gregory Birmingham filed a voluntary petition for Chapter 13 bankruptcy. PNC Bank had a claim against Birmingham for a mortgage in the amount of $343,101.87, which was secured by a deed of trust on Birmingham's primary residence in Beltsville, Maryland. Birmingham was in arrears on his mortgage in the amount of $93,386.58. Birmingham filed his Original Chapter 13 Bankruptcy Plan on June 4, 2014. The plan included a cram-down (or modification) of PNC's interest in the property. A cram-down occurs when the principal balance of a debt is reduced to the value of the property securing the debt. At that time, Birmingham's property was valued at $206,400.

The anti-modification provision in the bankruptcy code protects a secured creditor from having its claim in a Chapter 13 bankruptcy proceeding modified. Birmingham sought to avoid application of this provision with regard to the debt he owed PNC. In particular, Birmingham filed a Complaint for Declaratory Action requesting that PNC's claim be treated as a partially unsecured claim subject to modification. He argued that certain provisions of the Deed of Trust ("Provisions") required collateral other than real property, which would remove the claim from 11 U.S.C. § 1322(b)(2)'s anti-modification protection. PNC filed a motion to dismiss contending that the items referred to in the Deed of Trust constituted incidental property, which was a part of Birmingham's principal residence. Therefore, PNC argued that the additional items did not expose the PNC mortgage to a cram-down. The bankruptcy court granted PNC's motion, noting that arguments identical to Birmingham's had been repeatedly denied by the bankruptcy court. Birmingham appealed to the United States District Court for the District of Maryland. The District Court affirmed the bankruptcy court's determination, holding that the Provisions were benefits that were "merely incidental" to the interest in real property and were not additional security for purposes of § 1322(b)(2). Birmingham then appealed to the Fourth Circuit.

The Fourth Circuit held that the district court properly affirmed the bankruptcy court's determination that PNC Bank was entitled to the protection of the anti-modification provisions of § 1322(b)(2) because the Provisions of the Deed of Trust were incidental property.

The court first analyzed the relevant statutory provisions. It noted that under Chapter 13, debtors may obtain adjustment of their debt through flexible repayment plans approved by a bankruptcy court. The adjustment of a debtor's debt depends on two statutory provisions, 11 U.S.C. § 506(a) and 11 U.S.C. § 1322(b)(2). Under § 506(a), a secured creditor's claim can be modified, or bifurcated, into secured and unsecured portions when the claim exceeds the value of the secured property. However, relying on the Supreme Court precedent Nobelman v. Am. Sav. Bank., 508 U.S. 324 (1993), the Fourth Circuit noted that a debtor's debt cannot be modified if the mortgage is secured "only by a security interest in real property that is the debtor's principal residence." The court looked to the Bankruptcy Code for the definition of "debtor's principal residence," which is "a residential structure if used as the principal residence by the debtor, including incidental property, without regard to whether that structure is attached to real property." Additionally, it defined "incidental property" as including "escrow funds" and "insurance proceeds."

Furthermore, the Fourth Circuit pointed to several cases from sister circuits, which held that the insurance and other items mentioned in the Provisions were only incidental property and did not create additional security in the property. For example, in Allied Credit Corp v. Davis, 989 F.2d 208 (6th Cir. 1993), the Sixth Circuit found that certain items that are inextricably bound to the real property itself as "part of the possessory bundle of rights" do not extend a lender's security beyond the real property. The Fourth Circuit found this reasoning persuasive as it applied to the provisions involving the escrow items, property insurance proceeds and miscellaneous proceeds. Therefore, the court found the Deed of Trust on Birmingham's property was secured only by real property that was his principal residence. Therefore, the Fourth Circuit affirmed the District Court's judgment.

To read the full opinion, click here.

Panel: Judges Thacker and Harris, and District Judge Lee

Argument Date: 10/26/2016

Date of Issued Opinion: 01/18/2017

Docket Number: 15-1800

Decided: Affirmed by published opinion.

Case Alert Author: Lauren Harrison, Univ. of Maryland Carey School of Law

Counsel: ARGUED: John Douglas Burns, THE BURNS LAW FIRM, LLC, Greenbelt, Maryland, for Appellant. Daniel J. Tobin, BALLARD SPAHR LLP, Washington, D.C., for Appellee. ON BRIEF: Bryan J. Harrison, Matthew G. Summers, BALLARD SPAHR LLP, Baltimore, Maryland, for Appellee.

Author of Opinion: District Judge Lee

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/14/2017 12:22 PM     4th Circuit     Comments (0)  

  Hall v. Direct TV,LLC -- Fourth Circuit
DIRECTV Cannot Escape Claims that It Underpaid Employees

Areas of Law: Employment Law; Civil Procedure

Issue Presented: Whether the district court erred in finding that the Plaintiffs' claims should be dismissed because they did not sufficiently allege that the Defendants jointly employed them for purposes of the Fair Labor Standards Act ("FLSA").

Brief Summary: In a published opinion, the United States Court of Appeals for the Fourth Circuit reversed the district court's decision to dismiss the Plaintiffs' complaint. The court held that the Plaintiffs (who were satellite television technicians) adequately stated a claim under the FLSA because they sufficiently alleged the Defendants were jointly their employers and that they were employees, and not independent contractors of the Defendants.

Extended Summary: DIRECTV is the nation's largest satellite television provider and uses thousands of technicians to install and repair its satellite systems. DIRECTV manages the technicians through its "Provider Network." This network is organized as a pyramid in which DIRECTV contracts with home and secondary service providers who then contract with subcontractors. These subcontractors contract directly with the individual technicians. DirectSat was a home service provider in DIRECTV's network at the time of the filing of the relevant complaint. DirectSat was the middleman between DIRECTV and individual technicians. DirectSat implemented DIRECTV's hiring criteria, relayed DIRECTV's scheduling to the technicians using DIRECTV's work-assignment system, and supervised the technicians. DirectSat also maintained personnel files that were audited and regulated by DIRECTV. Additionally, DIRECTV required technicians to use DIRECTV equipment and attend DIRECTV training at Directsat facilities.

Between 2007 and 2014, each Plaintiff worked as a technician for DirectSat DIRECTV, or one of the other entities in the DIRECTV pyramid. Plaintiffs principal duty was to install and repair DIRECTV equipment. During their periods of employment, each Plaintiff was classified by their employer(s) as an independent contractor. The Plaintiffs alleged that DIRECTV directed and controlled Plaintiffs' work. For example, DIRECTV was the primary, if not the only client of each of the providers who served as the Plaintiffs' direct employers. Additionally, the Plaintiffs were required to wear DIRECTV gear, carry DIRECTV ID cards, and display the DIRECTV logo on their cars. DIRECTV also exercised quality control over each technician's work and controlled compensation. Finally, DIRECTV was allowed to terminate technicians by not assigning them work assignments through the work assignment system.

The Plaintiffs claimed they regularly worked in excess of forty hours per week, but were not paid overtime while they were DIRECTV technicians. So, the Plaintiffs filed various lawsuits in several jurisdictions, which were then consolidated. The Plaintiff's allege that the Defendants (DIRECTV and DirectSat) were their joint employers during the relevant period and that the Defendants' failure to pay overtime for the additional hours violated the overtime and minimum wage requirements of the Fair Labor Standards Act (FLSA). Additionally, the Plaintiffs brought claims under several Maryland wage statutes. The Defendants each moved to dismiss the Plaintiffs' Complaint, which was granted by the district court. The district court found that since the Plaintiffs did not allege that DIRECTV directly hired or fired them or controlled their compensation, the complaint did not allege facts that were sufficient to show DIRECTV was a joint employer. Additionally, the court concluded that the claims under the Maryland wage and labor statutes also failed. The Plaintiffs appealed the district court's dismissal.

The Fourth Circuit reversed the district court's decision finding that the Plaintiffs' allegations demonstrated that DIRECTV and DirectSat both jointly employed the Plaintiffs. The Fourth Circuit found that the district court (1) applied the improper legal test for determining whether entities are joint employers under the FLSA, and (2) misapplied the plausibility standard from Twombly and Iqbal. First, the court found that the district court incorrectly concluded that a worker must be an employee, as opposed to an independent contractor, of each joint employer for the entities to even be considered joint employers. Additionally, the Fourth Circuit found the district court improperly relied on Bonnette v. California, 704 F.2d 1465 (9th Cir. 1983), to determine whether the Defendants jointly employed the Plaintiffs.

The Fourth Circuit concluded that the correct inquiry involved two steps: (1) considering whether the Defendant and one or more additional entities shared, agreed to allocate responsibility for, or otherwise co-determined the key terms of the Plaintiffs' work; and (2) considering whether the worker was an employee or independent contractor by looking to the entire agreement as one agreement. Additionally, the Fourth Circuit concluded that Bonnette was not the correct test for determining whether two employers are joint employers. Instead, the 6-factor test announced in Salinas v. Commercial Interiors Inc., No. 15-1915, slip op. (argued Oct. 27, 2016), is the correct test for making the joint employment determination. Therefore, the court erred in granting the motion to dismiss.

Even with this determination, the Fourth Circuit had to consider whether the Plaintiffs' allegations were sufficient to state a plausible FLSA joint employment claim against the Defendants. The court found that the Plaintiffs stated plausible claims that DIRECTV and DirectSat were their joint employers because they alleged sufficiently that the companies codetermined the key terms and conditions of Plaintiffs' employment. Additionally, the court found that Plaintiffs were employees within the meaning of the FLSA. The court looked to the six factors from United States v. Silk in making this determination. It found that the Plaintiffs sufficiently alleged they were economically dependent on the Defendants while they were technicians.

Finally, the court considered the Defendants contention that the district court's determination should be affirmed because the Plaintiffs did not adequately "articulate a sufficiently detailed accounting of the number of uncompensated hours they worked during their respective periods of employment" to state a claim for unpaid overtime under the FLSA. The court noted that some courts have a strict standard and others have a more lenient standard in determining the sufficiency of the Plaintiffs accounting of their hours. Under the lenient standard, the Plaintiffs just need to state that they worked 40 hours and some additional hours, which they were not compensated for. The Fourth Circuit adopted the lenient standard in which "a plaintiff must provide sufficient factual allegations to support a reasonable inference that he or she worked more than forty hours in at least one workweek and that his or her employer failed to pay the requisite overtime premium for those over time hours." Additionally, the court carefully noted that plaintiffs do not have to specify the weeks, they just have to move the claim from conceivable to plausible. In this case, the Plaintiff's allegations provided a sufficient basis to support the reasonable inference that they were uncompensated for overtime hours while they were DIRECTV technicians.

To read the full opinion, click here.

Panel: Judges Wynn, Floyd, and Harris

Argument Date: 10/27/2016

Date of Issued Opinion: 01/25/2017

Docket Number: 15-1857

Decided: Reversed and remanded by published opinion.

Case Alert Author: Lauren Harrison, Univ. of Maryland Carey School of Law

Counsel: Larkin E. Walsh, STUEVE SIEGEL HANSON LLP, Kansas City, Missouri, for Appellants. Colin David Dougherty, FOX ROTHSCHILD LLP, Blue Bell, Pennsylvania, for Appellees. ON BRIEF: George A. Hanson, Kansas City, Missouri, Ryan D. O'Dell, STUEVE SIEGEL HANSON LLP, San Diego, 3 California, for Appellants. Nicholas T. Solosky, FOX ROTHSCHILD LLP, Washington, D.C., for Appellees.

Author of Opinion: Circuit Judge Wynn

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/14/2017 12:10 PM     4th Circuit     Comments (0)  

  Salinas v. Commercial Interiors Inc. -- Fourth Circuit
Who's the Boss? New Test to Determine Joint Employment under the Fair Labor Standards Act

Areas of Law: Employment Law

Issue Presented: Whether a worker is jointly employed for the purposes of determining liability under the employer's FLSA obligations.

Brief Summary: In a published opinion, the United States Court of Appeals for the Fourth Circuit reversed the district court's judgment granting the defendant's motion for summary judgment, and ruled that the defendants jointly employed the plaintiffs. Relying on a newly announced six-factor test that focuses on whether employers "share[d] or codetermined the essential terms and conditions of employment," the Fourth Circuit held that the defendants did jointly employee the plaintiffs for the purposes of determining liability under the employers FLSA obligations.

Extended Summary: The plaintiffs sued JI General Contractor Inc. ("JI") and Commercial Interior Inc. ("Commercial") for unpaid wages in violation of the Fair Labor Standards Act ("FLSA"), Maryland Wage and Hour Law, and the Maryland Wage Payment and Collection Law. The complaint alleged that Commercial and JI (1) jointly employed the plaintiffs, and (2) were jointly and severally liable.

The district court granted Commercial's motion for summary judgment and held that JI was the plaintiffs' sole employer because Commercial and JI entered into a legitimate contractor-subcontractor agreement. On appeal to the Fourth Circuit, the plaintiffs argued that the district court did not properly conform to the FLSA definition of "employ," "employee," and "employer;" and improperly limited joint employment. On appeal, the United States Court of Appeals for the Fourth Circuit reversed the district court's award of summary judgment.

In reversing the lower court, the Fourth Circuit reaffirmed that for the purposes of determining FLSA liability the business agreement is not important. For the purposes of determining joint employment and liability, the court first looks at whether two entities agree to allocate responsibility or codetermine the terms and conditions of the worker's employment. Next, the court must consider whether the two entities combined influence over the terms and conditions of the worker's employment makes the worker an employee.

The Fourth Circuit noted that while JI formally employed the plaintiffs, Commercial supervised the plaintiffs on the job site and maintained JI employee's time sheets. Additionally, before working, Commercial required JI employees to attend daily meetings where Commercial employees gave workers instructions while JI supervisors translated the instructions from English to Spanish. While working, JI employee used tools and materials owned and issued by Commercial bearing Commercial's logo while being directly supervised by Commercial employees. Finally, Commercial employees threatened to fire JI employees for substandard work, and during certain projects JI workers worked directly for Commercial and were issued pay checks from Commercial.

In determining whether a relationship between two corporate entities exists to determine FLSA obligations, the Fourth Circuit first looked to the Department of Labor regulations distinguishing "separate and distinct employment" from "joint employment." The regulations define separate employment as two or more employers that act entirely independently and may disregard all work performed by workers for another employee. The regulation defines joint employment as employment where the employment by one employer is not completely disassociated from employment by the other employer.

Relying on these regulations, the Fourth Circuit created a test to determine if employers "share or codetermine the essential terms and conditions" of employment, instead of relying on the test from other circuits that focuses on the economic relationship between the employers. To determine whether two entities constitutes joint employers for the purposes of FLSA, the Fourth Circuit held that courts should consider the following factors:

(1) Whether, formally or as a matter of practice, the putative joint employers jointly determine, share, or allocate the power to direct, control, or supervise the worker, whether by direct or indirect means; (2) Whether, formally or as a matter of practice, the putative joint employers jointly determine, share, or allocate the power to - directly or indirectly - hire or fire the worker or modify the terms or conditions of the worker's employment; (3) The degree of permanency and duration of the relationship between the putative joint employers; (4) Whether, through shared management or a direct or indirect ownership interest, one putative joint employer controls, is controlled by, or is under common control with the other putative joint employer;(5) Whether the work is performed on a premises owned or controlled by one or more of the putative joint employers, independently or in connection with one another; and (6) Whether, formally or as a matter of practice, the putative joint employers jointly determine, share, or allocate responsibility over functions ordinarily carried out by an employer, such as handling payroll; providing workers' compensation insurance; paying payroll taxes; or providing the facilities, equipment, tools, or materials necessary to complete the work.

In announcing the new test the Fourth Circuit cautioned that the factors are not exhaustive and the ultimate determination of joint employment must be based on the circumstances of the whole activity.

Using the factors in the new test, the Fourth Circuit held that the plaintiffs were jointly employed by both JI and Commercial. In applying the first and second factors, the court found that Commercial and JI jointly supervised and controlled the plaintiffs. Under the third and fourth factors, the court recognized that while Commercial did not own JI, most of JI's work came directly from Commercial. When JI did take work from another general contractor it was because Commercial did not have work for JI. Finally, the court held that the final factor supported the fact that JI and Commercial jointly employed the plaintiffs because Commercial supplied JI works with the tools, materials, and equipment necessary to work.

To read the full opinion, click here.

Panel: Judges Wynn, Floyd, and Harris

Argument Date: 10/27/2016

Date of Issued Opinion: 01/25/2017

Docket Numbers: No. 15-1915

Decided: Reversed by published opinion

Case Alert Author: Fernando Kirkman, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Sally Jean Dworak-Fisher, PUBLIC JUSTICE CENTER, Baltimore, Maryland, for Appellants. Michael J. Jack, LAW OFFICES OF MICHAEL J. JACK, Marriottsville, Maryland, for Appellee. Dean Romhilt, UNITED STATES DEPARTMENT OF LABOR, Washington, D.C., for Amicus Secretary of Labor. ON BRIEF: Darin M. Dalmat, Kathy L. Krieger, JAMES & HOFFMAN, P.C., Washington, D.C., for Appellants. M. Patricia Smith, Solicitor of Labor, Jennifer S. Brand, Associate Solicitor, Paul L. Frieden, Counsel for Appellate Litigation, Office of the Solicitor, UNITED STATES DEPARTMENT OF LABOR, Washington, D.C., for Amicus Secretary of Labor. Brian J. Petruska, LIUNA MID ATLANTIC REGIONAL ORGANIZING COALITION, Reston, Virginia; Catherine K. Ruckelshaus, NATIONAL EMPLOYMENT LAW PROJECT, INC., New York, New York, for Amici National Employment Law Project, Laborers' International Union of North America Mid-Atlantic Regional Organizing Coalition, and Centro De Los Derechos Del Migrantes.

Author of Opinion: Judge Wynn

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/14/2017 11:03 AM     4th Circuit     Comments (0)  

  Verisign, Inc. v. XYZ.com LLC, et al. -- Fourth Circuit
Dueling Domain Operator Falls Short of Proving Lanham Act Claim

Areas of Law: Lanham Act

Issue Presented: Whether the appellees violated the Lanham Act's prohibition against false advertising by promoting their product as "the next .com" and by criticizing their competitor's product through subjective language.

Brief Summary: In a published opinion, the United States Court of Appeals for the Fourth Circuit affirmed the District Court's award of summary judgment to appellees XYZ.com, LLC and Daniel Negari in a false advertising action brought by Verisign, Inc. under the Lanham Act.

Extended Summary: This case arose out of a false advertising action under the Lanham Act. Appellant Verisign, Inc. ("Verisign") is the exclusive operator of .com. and .net top-level domains. In 2014, after the Internet Corporation for Assigned Names and Numbers ("ICANN") approved the introduction of new top-level domains into the market, appellee XYZ.com, LLC ("XYZ") launched the .xyz domain. To promote the domain, XYZ and its CEO Daniel Negari ("Negari") made statements within two broad categories. First, XYZ made self-promotional statements about its registration numbers and popularity, including that XYZ secured over one million registrations and that .xyz was "the next .com." Second, XYZ made allegedly disparaging statements about Verisign's .com domain by declaring that it is "impossible to find the domain name that you want" and that "[a]ll of the good real estate is taken" except for "only . . . something with a dash or maybe three dashes and a couple numbers in it."

Verisign filed suit against XYZ and Negari alleging that appellees' statements violated the Lanham Act. To prevail on a false advertising claim under the Lanham Act, a plaintiff must show: (1) the defendant made a false or misleading representation of fact in a commercial advertisement; (2) the misrepresentation is material and likely to influence a consumer's decision; (3) the misrepresentation deceives or tends to deceive a substantial portion of the audience; (4) the defendant placed the misrepresentation in interstate commerce; and (5) the plaintiff suffered or is likely to suffer an injury by diversion of sales or lessening of goodwill.

Verisign contended that XYZ misrepresented actual consumer demand for the .xyz domain through its self-promotional statements and that XYZ made falsely disparaging statements about the .com domain. To support its claim, Verisign conducted a survey to test consumers' reactions to XYZ's statements. Verisign argued that it suffered approximately $527,000 in lost profits due to diverted sales, relying on an expert's testimony that she multiplied Verisign's lost profits by XYZ's market share at the time of the challenged statements. The District Court granted summary judgment to XYZ and Negari.

On appeal, the Fourth Circuit affirmed the District Court's judgment on the basis that Verisign failed to demonstrate that appellees' statements violated the Lanham Act. With respect to XYZ's self-promotional statements, the Fourth Circuit concluded that Verisign failed to prove that it suffered an injury caused by the challenged statements. Verisign's expert testimony proved only a temporal link between XYZ's statements and Verisign's lost profits, rather than the causal link required by the Lanham Act.

Turning to XYZ's allegedly disparaging statements, the Fourth Circuit held that the challenged statements did not constitute false or misleading factual statements, as required by the first element of a Lanham Act claim. Citing the Eighth Circuit's decision in American Italian Pasta Co. v. New World Pasta Co., 371 F.3d 387 (8th Cir. 2004), the Fourth Circuit reasoned that XYZ's statements concerning the availability of desirable .com names constituted mere opinion or puffery and therefore did not violate the Lanham Act. Specifically, XYZ's claim that it is "impossible to find the domain name that you want" was not verifiable due to the indefinite nature of "you." The Fourth Circuit also extended its reasoning to Negari's statements that "[a]ll of the good real estate is taken" and that the "only thing that's left is something with a dash." The Fourth Circuit emphasized that "good" constituted a subjective opinion and that "only" resembled a colloquial exaggeration upon which no reasonable consumer would rely. The Fourth Circuit therefore affirmed the District Court's award of summary judgment to XYZ and Negari.

To read the full opinion, click here.

Panel: Judges Wynn, Floyd, and Harris

Argument Date: 10/27/2016

Date of Issued Opinion: 02/08/2017

Docket Numbers: No. 15-2526

Decided: Affirmed by published opinion

Case Alert Author: Linda Morris, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Lisa Schiavo Blatt, ARNOLD & PORTER LLP, Washington, D.C., for Appellant. Derek Alan Newman, NEWMAN DU WORS LLP, Seattle, Washington, for Appellees. ON BRIEF: Ronald L. Johnston, Los Angeles, California, Robert N. Weiner, Robert A. DeRise, Elisabeth S. Theodore, ARNOLD & PORTER LLP, Washington, D.C., for Appellant.

Author of Opinion: Judge Harris

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/14/2017 10:48 AM     4th Circuit     Comments (0)  

  Smith v. Munday -- Fourth Circuit
A Case of Mistaken Identity: 4th Circuit Rules No Evidence, No Probable Cause

Areas of Law: Constitutional Law, Fourth Amendment, and Qualified Immunity

Issues Presented: 1) Whether investigating officers had probable cause to arrest appellant and 2) whether the arresting officer was entitled to qualified immunity.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that Officer Jason Munday's application for an arrest warrant lacked probable cause and thus violated Smith's Fourth Amendment rights. Having found that no probable cause existed for the warrant, the court determined that Officer Munday was not entitled to qualified immunity. Accordingly, the Fourth Circuit reversed the district court's ruling and remanded for further proceedings.

Extended Summary: In March 2009, investigating officers Munday and McGinley conducted an undercover investigation using a confidential informant, Rufus Lynch. The officers wired Lynch with audio and video recorders and paid him sixty dollars to engage in a drug transaction. Lynch then went to a location where he purchased crack cocaine from two individuals. After the transaction, Lynch returned to the officers and told them he had purchased the drugs from a "skinny Black female" named "April Smith." Both the audio recorder and camera failed to capture the drug transaction. Over a nine-month period following the transaction, Officer Munday scanned police databases for residents of Lincoln County with criminal records named April Smith. He eventually found a woman named April Yvette Smith, who was a Black female resident of Lincoln County and had been convicted of selling crack cocaine on three separate occasions. He also found two other "April Smiths" with criminal records. Officer Munday had no evidence that the woman who sold crack to Lynch had a criminal record, or was even a Lincoln County resident. He also did not attempt to investigate April Yvette Smith or connect her to the drug transaction. Nevertheless, Munday applied for and received an arrest warrant for Smith on charges of possession with intent to sell crack cocaine and selling or distributing cocaine. Smith was arrested in December 2009 in her home, which was eleven miles away from the site of the drug sale. Smith was held in custody for approximately eighty days until the Lincoln District Attorney's Office dropped the charges against her. Smith allegedly lost her job while in police custody.

Smith filed suit alleging, inter alia, constitutional violations of the Fourth and Fourteenth Amendments and state law claims for negligence and false arrest. The district court found no constitutional violation had occurred. The district court reasoned that the investigating officers had probable cause to believe that Smith was the woman who sold crack cocaine to Lynch because they were looking for a Black woman named April Smith who sold drugs, and found a person fitting this description only eleven miles away from where the drug sale occurred. The Fourth Circuit disagreed, stating that a criminal history, and common race, gender, and name are insufficient to establish probable cause. The court determined that Officer Munday did not have enough information for any reasonable or prudent person to believe there was probable cause. Moreover, the court reasoned, Munday had no evidence about Smith's conduct, let alone whether she was a participant in, connected to, or even physically present near the drug sale in question. All he knew was that she had previously been convicted for selling drugs, that she was a Black woman, and that she lived "near" the site of the drug sale. The court warned that finding this amount of evidence sufficient for probable cause would allow officers to obtain arrest warrants for any local residents who fit generic descriptions and have an unfortunately common name. The court distinguished this case from two previous cases with similar facts, Thompson v. Prince William County, 753 F.2d 363 (4th Cir. 1985), and Durham v, Horner, 690 F.3d 183 (4th Cir. 2012). In Thompson, the court noted, the police officer used multiple methods to establish the arrestee's identity; and in Durham, a grand jury - not the police officer - determined the existence of probable cause and found that it was the proximate cause of the arrest.

To the question of whether Munday was entitled to qualified immunity, the court determined that he was not. The court found it would be unreasonable for any officer to view Munday's dearth of evidence as sufficient to establish probable cause. Further, the court explained, had Munday carefully reflected on his warrant application, perhaps Smith would not have been incarcerated for eighty days and allegedly lost her job.

Judge Agee disagreed with the majority's finding that the arrest warrant was not supported by probable cause and that Officer Munday was not entitled to qualified immunity. He determined that reasonable minds could disagree as to whether probable cause existed, and therefore found that Munday was entitled to qualified immunity. In particular, Judge Agee disagreed with the majority's distinction between Smith's case and Durham, arguing that the two were analogous because Munday's evidence was "ample" when viewed in its totality. Moreover, Judge Agee argued the evidence in this case was stronger because, unlike in Durham, there was no contradictory evidence. Judge Agee thus concluded that the majority's holding that probable cause was lacking was erroneous. Finally, Judge Agee argued that Munday was entitled to qualified immunity because the majority failed to leave room for the "reasonable error" inherent in a qualified immunity analysis.

To read the full opinion, click here.

Panel: Gregory, Chief Judge, and King and Agee, Circuit Judges.

Argument Date: 09/20/2016

Date of Issued Opinion: 02/03/2017

Docket Number: No. 15-1496

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

Case Alert Author: Yvette Pappoe, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Algernon Williams, Sr., LAW OFFICE OF ALGERNON WILLIAMS, Charlotte, North Carolina, for Appellant. Patrick Houghton Flanagan, CRANFILL SUMNER & HARTZOG LLP, Charlotte, North Carolina; Joseph Finarelli, NORTH CAROLINA DEPARTMENT OF JUSTICE, Raleigh, North Carolina, for Appellees. ON BRIEF: Matthew K. Lilly, CRANFILL SUMNER & HARTZOG LLP, Charlotte, North Carolina; Roy Cooper, North Carolina Attorney General, Donna Elizabeth Tanner, Assistant Attorney General, NORTH CAROLINA DEPARTMENT OF JUSTICE, Raleigh, North Carolina, for Appellees.

Author of Opinion: Chief Judge Gregory

Case Alert Circuit Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/14/2017 10:36 AM     4th Circuit     Comments (0)  

  Abilt v. Central Intelligence Agency -- Fourth Circuit
National Security > Disability Discrimination: Sleepy Spy Shoulders "Unfortunate Burden" in State Secrets Privilege Case

Areas of Law: Employment Law, Disability Law

Issue Presented: Whether the district court correctly applied the state secrets doctrine.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that the district court correctly applied the state secrets doctrine. The court affirmed the district court's decision to dismiss Abilt's lawsuits against the Central Intelligence Agency.

Extended Summary: In June 2006, the Central Intelligence Agency ("CIA" or the "Agency") hired Jacob E. Abilt as an Applications Developer. Abilt informed the Agency that he had narcolepsy. Abilt became a covert employee in May 2008, rendering classified many of the basic facts of his employment with the Agency, including his job responsibilities and the identities of most of his supervisors and coworkers. In early 2009, Abilt began to experience difficulty managing his narcolepsy and asked his then-supervisor for permission to take periodic naps. His then-supervisor granted this request. Around the same time, the Agency's Medical Officer cleared Abilt for a temporary-duty-yonder ("TDY") assignment to an overseas warzone. Abilt was then assigned to a new supervisor, who delayed Abilt's TDY assignment by 30 days after he saw Abilt sleeping at his desk. Over the next two years, the Agency cancelled Abilt's war zone and TDY assignments and allegedly denied him other assignments and training opportunities because of his narcolepsy. Abilt filed administrative complaints with the Equal Employment Opportunity Office ("EEOO"), alleging disability discrimination, failure to accommodate, and retaliation. The Agency rejected his claims as unsupported, and the Equal Employment Opportunity Commission affirmed. Abilt was fired in October 2011.

Abilt sued the Agency and Director John Brennan in February 2014 and again in December 2014. He presented the same claims he had alleged in his EEOO complaint, as well as a failure to accommodate claim under both Title VII of the Civil Rights Act of 1964 and the Rehabilitation Act of 1973. The Agency invoked the state secrets privilege over various information related to Abilt's employment in both suits. Under the state secrets doctrine, the government may prevent the disclosure of information in a judicial proceeding if there is a reasonable danger that such disclosure will expose military matters which, in the interest of national security, should not be divulged. The district court dismissed Abilt's claims in both suits, holding that the Agency properly invoked the privilege. The court reasoned that neither Abilt nor the Agency could make a case without disclosing privileged information.

On appeal, Abilt argued that the district court misapplied the state secrets doctrine. He also contended that the Agency could defend itself by using non-classified information. The court disagreed, finding that even if Abilt could establish a prima facie case, the Agency could not defend itself without relying on privileged information. The court relied heavily on United States v. Reynolds, 345 U.S. 1, 10 (1953), and El-Masri v. United States, 479 F.3d 296, 302 (4th Cir. 2007), which established procedural requirements for invoking the privilege and the three-step analysis for the resolution of a claim of the privilege, respectively. The three-step analysis requires a court to: 1) ascertain that the procedural requirements for invoking the state secrets privilege have been satisfied; 2) decide whether the information sought to be protected qualifies as privileged under the state secrets doctrine; and 3) determine how the matter should proceed in light of the successful privilege claim if the information is determined to be privileged.

First, the court determined the Agency satisfied Reynolds' procedural requirements by submitting Director John Brennan's affidavit asserting the state secrets privilege after personal consideration of Abilt's claims and determining that classified information related to his employment was at risk of disclosure in this case. Second, the court found that the information the government sought to protect, such as the identity of covert CIA employees, Abilt's work assignments, the location of CIA facilities overseas, and the sources and methods used by the CIA, was properly privileged. Therefore, the disclosure of such information would threaten the national security of the United States. Finally, in deciding the ultimate question of how the matter should proceed given the privileged information, the court determined the case had to be dismissed. The court first noted that establishing each of the prima facie elements of Abilt's claims without the privileged information would be an "extremely high hurdle." Nevertheless, the court reasoned, assuming Abilt could clear the hurdle, the case should still be dismissed because any defenses the Agency could offer would "undoubtedly" rely on privileged information. The court found unconvincing Abilt's argument that the lower burden at step two of the McDonnell Douglas framework, a framework used to evaluate discrimination and retaliation claims under both statutes, was evidence that the Agency could defend itself without resort to privileged information. The court reasoned that the Agency was entitled to proffer legitimate, non-discriminatory reasons for its actions and because those reasons are privileged, the case had to be dismissed.

The court acknowledged the "unfortunate burden" its decision placed on Abilt on behalf of the entire country, noting that "Abilt suffers dismissal of his claim 'not through any fault of his own, but because his personal interest in pursuing his civil claim is subordinated to the collective interest in national security.'"

To read the full opinion, click here.

Panel: Wynn, Floyd, and Harris, Circuit Judges.

Argument Date: 10/27/2016

Date of Issued Opinion: 02/08/2107

Docket Number: No. 15-2568

Decided: Affirmed by published opinion. Judge Floyd wrote the opinion, in which Judge Wynn and Judge Harris joined.

Case Alert Author: Yvette Pappoe, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Donna Renee Williams Rucker, TULLY RINCKEY PLLC, Washington, D.C., for Appellant. Jaynie Randall Lilley, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellees. ON BRIEF: Benjamin C. Mizer, Principal Deputy Assistant Attorney General, Sharon Swingle, Civil Division, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C.; Dana J. Boente, United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Alexandria, Virginia, for Appellees.

Author of Opinion: Judge Floyd, Circuit Judge

Case Alert Circuit Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/14/2017 09:57 AM     4th Circuit     Comments (0)  

March 11, 2017
  United States v. Monsalvatge
Headline: Second Circuit Affirms District Court's Admission of Clips From 2010 Film "The Town" into Evidence During Armed Robbery Trial

Area of Law: Evidence and Criminal Law

Issue Presented: Whether the district court abused its discretion in admitting into evidence at trial clips from the 2010 film The Town, which were intended to shed light on the defendants' modus operandi in carrying out a bank robbery.

Brief Summary:
Defendant-appellants Akeem Monsalvatge, Edward Byam, and Derrick Dunkley were convicted in the Eastern District of New York of armed robberies of two Pay-O-Matic check-cashing stores. At the trial, the prosecution had played for the jury several short clips from the 2010 film The Town, which was about a group of Boston bank robbers. The Government used the clips to illustrate and explain the differences in modus operandi between the two robberies that occurred almost two years apart, arguing that before the second robbery, the defendants saw and admired The Town and used ideas from it. On appeal, the defendant-appellants argued that the district court abused its discretion in allowing the prosecution to show the clips. The Second Circuit disagreed. Affirming the Defendant-Appellants' convictions, the court found that the clips were relevant and that their probative value outweighed the potential for prejudice, particularly given the clips' very short length, the clips' narrow tailoring, and the district court's two curative instructions.

Extended Summary: Defendant-Appellants Akeem Monsalvatge, Edward Byam, and Derrick Dunkley appealed from their judgments of conviction in the United States District Court for the Eastern District of New York entered on April 10, 2014. The Defendant-Appellants were convicted after a jury trial of committing two armed bank robberies in violation of 18 U.S.C. § 1951(a), two counts of unlawful use of a firearm during the commission of a crime of violence in violation of 18 U.S.C. § 9124(c)(1)(A)(ii), and conspiracy to commit Hobbs Act robbery in violation of 18 U.S.C. § 1951(a). On April 10, 2014, District Court Judge Dearie sentenced each of the three Defendant-Appellants to thirty-two years of imprisonment, five years of supervised release, $240,795.62 in restitution, and a $500 special assessment.
On appeal, Defendant-Appellants raised a variety of claims. The Second Circuit's opinion addresses one of Monsalvagte's claims, which Dunkley joins: whether the district court abused its discretion in admitting into evidence at trial four clips from the the film The Town.

In advance of the trial, the Government filed a motion in limine requesting to play for the jury at trial film clips from The Town, a 2010 crime drama about a group of Boston bank robbers. The Government asserted the clips would serve as evidence regarding the genesis of the Defendant-Appellants' modus operandi in the second 2012 robbery and to explain the change in modus operandi between the first robbery committed in 2010 and the second in 2012. The district court granted the Government's motion to admit the clips over the Defendant-Appellants objections.
In the first robbery on February 24, 2010, three bandana-covered men, wielding guns, stole $44,039.73 from a Pay-O-Matic in Queens, New York, with one of the robbers gaining access to the protected area of the store by descending through the roof. In the second robbery on February 14, 2012, three robbers stole $200,755.89 at gunpoint from a Pay-O-Matic also located in Queens, New York. This time, however, the robbers wore police uniform disguises and lifelike special effects masks. The robbers also accosted a store employee by showing her pictures of her home in gaining access to the store. In addition, unlike in the first robbery, the robbers poured bleach on the teller counter in order to remove any fingerprints or DNA.

The clips from The Town, totaling one minute and seven seconds, depicted the film's protagonists utilizing the same methods in robbing banks as the robbers who committed the second robbery: pouring bleach on bank surfaces, threatening an employee by revealing knowledge of the employee's home address, wearing police badges, uniforms, and sunglasses, and wearing special effect masks. Furthermore, the Government admitted evidence intended to show that Defendant-Appellant Monsalvatge had seen The Town and admired it.

At trial, before and after the playing of the clips, the district court gave two curative instructions to the jury emphasizing that anything heard on the clips was not before them for the truth of it. Additionally, the district court also further instructed the jury about two differences between the 2012 robbery and the movie clips: that there was no evidence that any perpetrators of the robbery were at the home of the store employee and that unlike the movie clips, there was no evidence that the 2012 robbers used assault weapons in the commission of the robbery.

The Second Circuit reviewed the district court's evidentiary ruling over objection for abuse of discretion. The circuit court will only reverse an evidentiary ruling under abuse of discretion review if the ruling was arbitrary and irrational. Furthermore, the circuit court noted it had in the past declined to second-guess a district court's admission of relevant video or media evidence where the evidence bears an identifiable connection to an issue or defendant in the case.

In affirming the district court's admittance of the movie clips, the Second Circuit found the clips, in conjunction with other evidence, tended to make more probable the factual inference that the 2010 and 2012 robberies were part of the same conspiracy. The Second Circuit noted the aforementioned similarities between the 2012 robbery and the robberies portrayed in The Town as well as the fact that the film had not yet been released prior to the 2010 robberies. In rejecting the Defendant-Appellants contention that the admittance of the clips was prejudicial, the Second Circuit held any prejudicial effect was minimal given the clips' extreme short length, the clips' narrow tailoring and the district court's two curative instructions.
Thus, the Second Circuit found the district court did not abuse its discretion in admitting into evidence the clips from the The Town and therefore affirmed the convictions of Defendant-Appellants Monsalvatge and Dunkley.

To read the full opinion, click http://www.ca2.uscourts.gov/de...11df30b888aa/3/hilite/ .

Panel: Circuit Judges Livingston and Droney; District Judge Torres, sitting by designation

Argument Date: 10/02/2015

Date of Issued Opinion: 03/08/2017

Docket Numbers:
14-1113

Decided: Affirmed

Case Alert Author: Thomas J. Baroni

Counsel: Jonathan I. Edelstein, Edelstein & Grossman, New York, N.Y. for Defendant-Appellant Akeem Monsalvatge; Patrick Michael Megaro, Orlando, Fla. for Defendant-Appellant Edward Byam; Daniel M. Perez, Law Offices of Daniel M. Perez, Newton, N.J. for Defendant-Appellant Derrick Dunkley; Tyler J. Smith, Jo Ann M. Navickas, Tiana A. Demas, Maria Cruz Melendez, Assistant United States Attorneys, New York, N.Y., (Kelly T. Currie, Acting United States Attorney for the Eastern District of New York) for Appellee United States of America

Author of Opinion: Judge Livingston; concurrence by Judge Torres

Circuit: Second Circuit

Case Alert Circuit Supervisor: Professor Emily Gold Waldman

    Posted By: Emily Waldman @ 03/11/2017 02:55 PM     2nd Circuit     Comments (0)  

March 9, 2017
  Saleh v. Bush - Ninth Circuit
Headline: Ninth Circuit panel holds that Westfall Act provides immunity from liability under the Alien Tort Statute to high ranking Bush Administration officials.

Areas of Law: Westfall Act, Immunity of Government Officials

Issues Presented: (1) Whether the Westfall Act provides absolute immunity to government officials for alleged violations of the Alien Tort Statute. (2) Whether Congress can grant immunity from liability to federal officials for a jus cogens violation.

Brief Summary: Appellant Sundus Shaker Saleh ("Saleh") filed a class action lawsuit against a number of Bush Administration officials ("Appellees"), alleging that they conspired to wage a war of aggression against Iraq, a violation of the "law of nations" under the Alien Tort Statute. Pursuant to the Westfall Act, the district court substituted the United States as the only defendant and dismissed the case due to Saleh's failure to exhaust administrative remedies as prescribed by the Federal Tort Claims Act. Saleh appealed, arguing that Appellees did not enjoy immunity under the Westfall Act and, even if they did, Congress cannot grant immunity to officials for a jus cogens violation. The Ninth Circuit panel affirmed the district court's decision to dismiss the case.

Significance: The Westfall Act provides immunity to federal government officials for claims arising from actions they performed in the course of their employment, even if those actions violate international law.

Extended Summary: In 2003 Kurdish Army troops allied with the United States and participating in the Iraq war allegedly forced Saleh and members of her family to leave their home and relocate to Jordan. She filed a class action lawsuit representing "all innocent Iraqi civilians who, through no fault of their own, suffered damage" as a result of the Iraq war. Her complaint alleged that Appellees, high ranking members of the Bush Administration, began planning an invasion of Iraq as early as 1997 and that they used the September 11, 2001 terrorist attacks as a pretext to convince the public and Congress of the need to launch the war on Iraq. Saleh alleged that Appellees often used fabricated information to support their position. The complaint claimed Appellees were liable under the Alien Tort Statute for an alleged violation of the "law of nations."

The United States filed a certification that Appellees were acting within the scope of their employment. The district court agreed and substituted the United States as the only defendant. The court then dismissed Saleh's suit without prejudice, finding that she failed to exhaust her administrative remedies as mandated by the Federal Tort Claims Act. Saleh then filed an amended complaint. The district court again substituted the United States and then dismissed the lawsuit with prejudice. Appellee moved for an evidentiary hearing to contest the certification that Appellees were acting within the scope of their employment but the district court denied the motion. This appeal followed.

The Ninth Circuit panel affirmed the district court's decision that Appellees were entitled to immunity under the Westfall Act and that the United States was the only proper defendant. The Westfall Act grants federal officials absolute immunity for torts committed in the course of their employment. The Act requires courts to employ the principles of respondeat superior in the state where an alleged tort occurred to determine the scope of employment inquiry. The policy behind this grant of immunity is to prevent the fear of potential litigation from affecting the decision making process of those involved in government. Under the Westfall Act, an official who is sued and believes he is entitled to immunity is instructed to forward all documents served to him to his supervisor who then must give copies to the United States Attorney General. The Attorney General investigates the matter and makes a determination as to whether the sued government official was working within the scope of his employment. If the determination is made that he was, the Attorney General issues a scope certification which changes the action against the government official into one against the United States and precludes any other civil action against the government official.

Saleh asserted two arguments to support her claim that Appellees were not working within the scope of their employment when they conspired to make war against Iraq. The first was that the preparation for the war began before the Appellees took office as government officials, the attack was incited by personal motives, and Appellees were not employed to start an illegitimate war. The second was that immunity under the Westfall Act must be analyzed in light of the treaty obligations of the United States.

The panel rejected both arguments. It applied District of Columbia respondeat superior principles to find Appellees' actions were committed within the scope of their employment as the Iraq war did not begin until after Appellees took office. Appellees' actions promoting the war prior to their taking office was not planning for the war, but merely advocacy. The panel further found Saleh's claim that the motives for the war were personal was not supported by the factual allegations in her complaint. Finally, the panel held that, as members of the Executive Branch of government, Appellees were authorized to act to ensure national security and as such their actions fell within their official duties. As for Saleh's second argument, the Ninth Circuit panel noted that the case she relied on was not instructive because the scope of employment test used there was created by international law and not one of a domestic nature as in this case. Further, the panel noted that the unambiguous language of the Westfall Act evidences Congress's specific intent to grant immunity to federal officers.

The Ninth Circuit panel also rejected Saleh's contention that the district court erred in denying her motion for an evidentiary hearing to challenge the scope certification by the Attorney General. The panel reasoned that because the allegations in Saleh's complaint viewed in the light most favorable to her were not enough to show that Appellees had acted outside the scope of their employment, such a hearing was unnecessary.

Finally the panel also rejected Saleh's argument that Congress cannot provide immunity to a federal government official for violations of a jus cogens norm of international law. A jus cogens norm is a norm acknowledged by international law from which no derogation is permitted. Without deciding whether the prohibition of aggression is a jus cogens norm, the panel concluded that Saleh's argument conflicted with United States case law. Precedent cases dealing with sovereign immunity of officials reveal that Congress can provide immunity to foreign government officials despite inconsistencies with international law. This precedent supported the conclusion that Congress can do the same for federal officers when they violate jus cogens norms.

To read the full opinion, please visit:

http://cdn.ca9.uscourts.gov/da...17/02/10/15-15098.pdf

Panel: Susan P. Graber and Andrew D. Hurwitz, Circuit Judges, and Richard F. Boulware, District Judge (sitting by designation)

Argument Date: December 12, 2016

Date of Issued Opinion: February 10, 2017

Docket Number: 15-15098

Decided: Judgment affirmed.

Counsel: Dave Inder Comar (argued), Comar Law, San Francisco, California, for Plaintiff-Appellant.

Patrick G. Nemeroff (argued), and Matthew M. Collette, Attorneys, Appellate Staff; Melinda Haag, United States Attorney; Benjamin C. Mizer, Principal Deputy Assistant Attorney General; Civil Division, United States Department of Justice, Washington D.C.; for Defendants-Appellees.

Jerome Paul Wallingford, San Diego, California, for Amicus Curiae Lawyers for International Law.

Rajeev E. Ananda, New York, New York, for Amicus Curiae Planethood Foundation.

Author of Opinion: Judge Graber

Circuit: Ninth Circuit

Case Alert Author: Maria Vittoria

Case Alert Supervisor: Philip L. Merkel

    Posted By: Glenn Koppel @ 03/09/2017 01:42 PM     9th Circuit     Comments (0)  

March 8, 2017
  United States v. Williams
Headline: Ninth Circuit panel affirms a suppression order when a criminal defendant invoked his Miranda rights and the government subsequently attempted to use unadmonished responses to a jail official's questions about the defendant's gang affiliation at trial.

Areas of Law: Criminal Law, Constitutional Law, Miranda Warnings.

Issue Presented: Whether the government may introduce evidence of a defendant's gang affiliation obtained through unadmonished questioning of defendant by a jail official after defendant asserted his Miranda rights.

Brief Summary: Appellee was initially charged with murder and other offenses in state court. When police attempted to interrogate him, he immediately invoked his Miranda rights. Later, a deputy sheriff handling the booking process asked him whether he had gang affiliations. Appellant responded in the affirmative. Appellee was later charged with numerous RICO offenses, and the United States attempted to use Appellee's booking statement in its case-in-chief. The district court issued an order suppressing the evidence. The government appealed, arguing the response fell under either the "booking exception" or the "public safety exception" to the Miranda warnings. The Ninth Circuit panel affirmed the district court ruling.

Significance: Once a criminal defendant invokes his Miranda rights, the government cannot use his responses to unadmonished questions regarding gang affiliation in its case-in-chief, even if the questions are part of routine booking procedures or related to promoting safety in jails.

Extended Summary: State authorities arrested Appellee for the murder. Homicide detectives advised him of his Miranda rights and attempted to interrogate him, but he explicitly invoked his right to an attorney. Appellee was later taken to a county jail. The deputy sheriff handling the booking process asked him if he was a gang member, and Appellee responded, "Yeah, I hang out there, put me where I'm from." The deputy entered the response on forms used by jail officials in determining where to house inmates. The forms designate any gang affiliation and reflect whether a prisoner presents "High Risks." The deputy reported Appellee's gang affiliation and marked "Gang Member" on the list of "High Risks."

Appellee was initially charged in state court with murder and other crimes. Later, the state charges were dismissed and he was indicted by a federal grand jury and charged with conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. § 1962(d); murder in aid of racketeering, 18 U.S.C. §1959(a)(1); and firearms offenses. The United States wished to use Appellee's statements of gang membership to satisfy an important element to the RICO charge: membership in a RICO enterprise. Appellee moved to suppress the statements, the district court granted the motion, and the United States appealed.

The Ninth Circuit panel began its analysis by citing the iconic rule of Miranda v. Arizona which holds that once a defendant indicates in any manner and at any stage of the process that he wishes to consult with an attorney before speaking there can be no questioning. 384 U.S. 436, 444-45 (1966). The panel also recognized, however, that there are exceptions to the rule, and discussed two exceptions the "booking questions exception" and the "public safety exception," ones that the government argued applied in this case.
The government asserted that the booking exception applied because the deputy sheriff who asked questions regarding gang affiliation could not have known the responses would be incriminating as no gang-related charges were pending at the time. The panel rejected this argument, holding that the issue is whether a booking question was reasonably likely to elicit an incriminating response in light of all the circumstances. The test is an objective one and the subjective intent of the officer is relevant but not conclusive. United States v. Washington, 462 F.3d 1124 (9th Cir. 2006). In this case, the absence of gang charges did not mean admission of gang affiliation could not be incriminating. The panel cited the California Supreme Court's decision in People v. Elizalde, which found that gang membership exposes a defendant to "a comprehensive scheme of penal statutes aimed at eradicating criminal activity by street gangs." 61 Cal. 4th 523, 538 (2015). The panel determined that questions about Appellee's gang affiliation were reasonably likely to elicit an incriminating response even though the federal RICO charges had not yet filed because it could have exposed him to even more charges under both California and federal laws.

The government also argued that the public safety exception to Miranda does not require adherence to the warnings when there is an "objectively reasonable need to protect the police or public from any immediate danger." United States v. Carrillo, 16 F.3d 1046, 1049 (9th Cir. 1994). The United States claimed the deputy sheriff asked questions regarding gang affiliation in the interests of inmate safety. The Ninth Circuit panel rejected this argument as there was no need to protect the deputy or others against immediate danger.

Dissent: Senior Circuit Judge Kleinfeld dissented, writing that both the booking exception and the public safety exception applied because the deputy sheriff asked questions regarding gang affiliation for the purpose of separating gang members from one another and protecting inmates from jail house violence.


To real the full opinion, please visit: https://cdn.ca9.uscourts.gov/datastore/opinions/2016/12/05/15-10475.pdf

Panel: Andrew J. Kleinfeld, Johnnie B. Rawlinson, and Andrew D. Hurwitz, Circuit Judges.

Argument Date: March 16, 2016

Date of Issued Opinion: December 5, 2016

Docket Number: 15-10475

Decided: Affirmed

Case Alert Author: Kyle Case

Counsel: Ann M. Voigts (argued), Assistant United States Attorney; Barbara J. Walliere, Chief, Appellate Division; Brian J. Stretch, United States Attorney; United States Attorney's Officer, San Francisco, California; for Plaintiff-Appellant
Mark Stuart Goldrosen (argued), San Francisco, California for Defendants-Appellees

Author of Opinion: Judge Hurwitz

Circuit: Ninth

Case Alert Supervisor: Professor Philip L. Merkel

    Posted By: Glenn Koppel @ 03/08/2017 07:17 PM     9th Circuit     Comments (0)  

  Silvester v. Harris
Headline: Ninth Circuit panel applies intermediate scrutiny standard in upholding California's waiting period law as relates to firearms purchasers who previously passed background checks.

Areas of Law: Constitutional Law; Second Amendment Rights; Waiting Period Laws

Issues Presented: The panel considered whether California's 10-day waiting period to take possession of any firearm violated the Second Amendment rights of subsequent purchasers where those purchasers passed the required background checks in less than the required 10-day wait period.

Brief Summary: The panel applied intermediate scrutiny in this case of first impression. The 10-day waiting period, as applied to three specified classes of "subsequent purchasers," was found to reasonably fit the State's important interest in promoting safety and requiring a cooling-off period to deter violence resulting from impulsive purchases of firearms.

Significance: The Supreme Court expressly left undecided the determination of the level of scrutiny applied to laws or regulations relating to individual rights under the Second Amendment. The Ninth Circuit panel determined that intermediate scrutiny should be applied to regulations which do not substantially burden the Second Amendment.

Extended Summary: This case involved a challenge to California's required 10-day wait period between the purchase and receipt of any firearm as it applied to purchasers belonging to specified classes. The 10-day waiting period was not challenged in its entirety. Instead, the challenge was limited to how it applied to three classes of purchasers. The first class of purchasers included individuals who have previously registered a firearm in the Automated Firearms System (AFS) database. The second class consisted of those purchasers with a concealed weapons permit. The final class included those purchasers who possessed a "certificate of eligibility" (COE) in the AFS. Plaintiffs did not assert that belonging to one of these classes meant they should receive the weapon on the same day as a purchase, but rather if their application was processed faster than 10 days and the purchaser was part of one of these three classes, then they should receive the weapon prior to the end of the 10-day wait period.

The district court applied intermediate scrutiny and found in favor of the plaintiffs, holding that the State's interest in a 10-day cooling off period did not justify denying the receipt of a firearm to purchasers belonging to these three classes where their applications were processed faster than ten days. The State appealed.

The panel's decision and reasoning stemmed from the Supreme Court's decision in District of Columbia v. Heller, 554 U.S. 570 (2008). In Heller, the District of Columbia banned all handguns and operable hunting rifles in the home. This case laid out the analysis required in a Second Amendment challenge. First, there must be a determination of whether the regulation is within the scope of the Second Amendment right. Next, the regulation must survive the appropriate level of scrutiny. However, the question as to what level of scrutiny should be applied was left unanswered, as the regulation in Heller would not have passed any level of scrutiny because it placed too heavy of a burden on the right to self-defense. The only determination made regarding the level of scrutiny was the express rejection of the rational basis standard of review.

The Supreme Court's decision to leave the standard of review open to either strict scrutiny or intermediate scrutiny led the panel to examine Ninth Circuit law that has developed since the decision in Heller. The two-step test of Heller has been consistently used with the second step requiring a determination of the level of scrutiny applicable. In Jackson v. City & County of San Francisco, the Ninth Circuit stated that a determination of the level of scrutiny requires consideration of: "(1) how close the challenged law comes to the core of the Second Amendment right, and (2) the severity of the law's burden on that right." 746 F. 3d at 960-61 (9th Cir. 2014). This established three types of categories in which a law may fall: (1) the law will be unconstitutional on any level of review; (2) met with strict scrutiny; or, (3) met with intermediate scrutiny depending upon the severity of the burden it imposes upon the Second Amendment right. A law falls into the first category will be unconstitutional under any level of review. A regulation falls within the second category where it places a substantial burden on Second Amendment rights. If the regulation falls in some other category, then it shall be met with intermediate scrutiny.

Intermediate scrutiny requires a determination of whether the regulation "reasonably fits" with an important governmental interest. A determination of an important governmental interest can be identified by looking to the history and operation of the California law. The history of the waiting period for firearms purchases began in 1923 and has been in continuous existence since. Waiting period laws began as a ban on certain firearms from being delivered on the day of the purchase. In addition to the waiting period, the law created the Dealer Record of Sale (DROS), which is presently used electronically. Throughout the history of the waiting period, it has been extended up to as long as fifteen days. The extensions were reflective of the State's need to conduct more extensive background checks and were only reduced when technology permitted faster processing. The 1996 reduction of wait period time to ten days included a legislative explanation for the waiting period laws. The governmental interests asserted were: (1) the time required to conduct a proper background check, and (2) the need for a "cooling off" period.

The panel applied the two-step test for intermediate scrutiny to the waiting period law. There must be important governmental objectives behind the law, and the law must be reasonably suited to achieve those objectives. It was uncontested that the State's interests in promoting safety and reducing gun violence were important. The dispute was over whether the 10-day waiting reasonably fit those objectives. The panel concluded there was a reasonable fit because the waiting period allowed for background checks to be properly conducted and created a cooling-off period even for those purchasers who already owned a firearm. For these reasons, the 10-day waiting period for these classes of purchasers was held to be constitutional.


To read the full opinion, please visit: https://cdn.ca9.uscourts.gov/datastore/opinions/2016/12/14/14-16840.pdf

Panel: Sidney R. Thomas, Chief Judge, and Mary M. Schroeder and Jacqueline H. Nguyen, Circuit Judges.

Argument Date: February 9, 2016

Date of Opinion: December 14, 2016

Docket Number: 14-16840

Decided: Reversed the judgment of the district court's bench trial in favor of plaintiffs-appellees. Remanded the case to the court for an entry of judgment in favor of defendant-appellant, the State of California.

Case Alert Author: Greyson Morain

Counsel: Jonathan M. Eisenberg (argued) and Peter H. Chang, Deputy Attorneys General; Mark R. Beckington, Supervising Deputy Attorney General; Douglas J. Woods, Senior Assistant Attorney General; Kamala D. Harris, Attorney General; Office of the Attorney General, San Francisco, California; for Defendant-Appellant.

Bradley A. Benbrook (argued) and Stephen M. Duvernay, Benbrook Law Group PC, Sacramento, California; Donald E.J. Kilmer, Jr., Law Offices of Donald Kilmer, San Jose, California; Victor J. Otten, Otten Law PC, Torrance, California; for Plaintiffs-Appellees.

Anna M. Barvir, Clinton B. Monfort, and C.D. Michel, Michel & Associates PC, Long Beach, California, for Amici Curiae California Rifle and Pistol Association and Gun Owners of California.

Jeremiah L. Morgan, John S. Miles, William J. Olson, Robert J. Olson, and Herbert W. Titus, William J. Olson P.C., Vienna, Virginia; for Amici Curiae Gun Owners of America, Inc., Gun Owners Foundation, U.S. Justice Foundation, The Lincoln Institute for Research and Education, The Abraham Lincoln Foundation for Public Policy Research, Inc., Institute on the Constitution, and Conservative Legal Defense and Education Fund.

Michael Connelly, Ramona, California, as and for Amicus Curiae U.S. Justice Foundation.

George M. Lee, Seiler Epstein Ziegler & Applegate LLP, San Francisco, California; John R. Lott, Jr., Ph.D., Crime Prevention Research Center, Swarthmore, Pennsylvania; for Amicus Curiae Crime Prevention Research Center.

Marienne H. Murch, Rebecca A. Jacobs, and Simon J. Frankel, Covington & Burling LLP, San Francisco, California, for Amicus Curiae The Law Center to Prevent Gun Violence.

Jonathan E. Taylor and Deepak Gupta, Gupta Beck PLLC, Washington, D.C., for Amicus Curiae Everytown for Gun Safety.

David Skaar and Anthony Basich, Hogan Lovells US LLP, Los Angeles, California; Jonathan E. Lowry, Brady Center to Prevent Gun Violence - Legal Action Project, Washington, D.C.; for Amicus Curiae Brady Center to Prevent Gun Violence.

Author of Opinion: Judge Schroeder

Concurrence: Chief Judge Thomas

Circuit: Ninth Circuit

Case Alert Supervisor: Professor Philip L. Merkel

    Posted By: Glenn Koppel @ 03/08/2017 07:15 PM     9th Circuit     Comments (0)  

  Marilley v. Bonham
Headline: The Ninth Circuit, sitting en banc, holds that California's differential fees imposed on nonresident commercial fishers do not violate the Privileges and Immunities Clause or Equal Protection Clause.
Areas of Law: Constitution, Privileges and Immunities, Equal Protection, Commercial Fishing
Issue Presented: Whether differential fees charged by California to nonresident commercial fishers violates the Privileges and Immunities Clause or Equal Protection Clause when California uses the differential fees to compensate the State for the annual shortfall of roughly $14 million suffered by the California Department of Fish and Game to manage its commercial fishery and that shortfall is paid by California taxpayers.
Brief Summary: California charges nonresident commercial fishers a differential fee for commercial fishing licenses. However, for many years, California has operated its commercial fishery at a substantial loss. In fiscal year 2010-11, California spent roughly $20 million in managing its commercial fishery, yet it only received about $5.8 million in fees - including fees by both residents and nonresidents. This approximately $14 million deficit was paid for by California tax payers.
The Ninth Circuit held that the differential fees charged to nonresidents are justified under the Privileges and Immunities Clause because the differential fees are closely related to a substantial state interest which is to recover the state's expenditures in managing its commercial fishery that is attributable to the nonresidents. This is a deficit that would otherwise be covered by California's taxpayers. The Court also held the differential fees do not violate the Equal Protection Clause.
Significance: A state may collect compensation from nonresidents or exclude the nonresidents from the benefits when the state makes expenditures from a fund to which nonresidents do not contribute and the state provides a benefit by that expenditure to both residents and nonresidents. A state may not exclude nonresidents from access to a natural resource, but may pursue reimbursement for funds spent on managing and preserving the resource.
Extended Summary: California charges nonresident commercial fishers a differential fee for commercial fishing licenses. Beginning in 1986, California has charged nonresidents a higher fee than its residents for commercial fishing licenses, registrations, and permits, and subsequently began charging nonresidents more than residents for herring gill net permits, commercial vessel registrations, and Dungeness crab permits.
However, for many years, California has operated its commercial fishery at a substantial loss. In 2010-11, California spent roughly $20 million in managing its commercial fishery, yet it only received about $5.8 million in fees - including fees paid by both residents and nonresidents. This approximately $14 million shortfall was covered by California tax payers.
The Plaintiffs are a class of nonresident commercial fishers who engage in commercial fishing in California. They brought a class action in the district court against the Director of California's Department of Fish and Game, challenging the differential fees it charges to nonresidents under the Privileges and Immunities Clause, the Dormant Commerce Clause, and the Equal Protection Clause of the United States Constitution. They later voluntarily withdrew their Dormant Commerce Clause claim. The district court granted summary judgment for the plaintiffs based on their Privileges and Immunities claim. The Ninth Circuit, sitting en banc, reversed.
The Ninth Circuit referred to Toomer v. Witsell, 334 U.S. 385 (1948) and Mullaney v. Anderson, 342 U.S. 415 (1952) as authority for holding, "a state may charge differential fees to nonresident commercial fishers in order to recover the state's expenditures in enforcement and conservation measures that are attributable to the nonresidents."
California operates its commercial fishery at an annual cost of approximately $20 million, and it receives only about $6 million in fees collected from both residents and nonresidents. This shortfall of roughly $14 million is a subsidy or benefit conferred to both resident and nonresident commercial fishers paid for by California taxpayers.
Because 12% of all commercial fishers in fiscal year 2010-11 were nonresidents, and 12% of the $5,341,000 subsidy that went to all commercial fishers is approximately $641,000, California could have charged nonresidents up to that amount as their proportionate benefit received from California's general fund. Because nonresident commercial fishers paid a total of $435,000 in fee differentials which is significantly less than their proportionate share of the subsidy or benefit provided to them by California, the Ninth Circuit held that the differential fees are justified by the state and therefore permitted under the Privileges and Immunities Clause.
The Ninth Circuit also dismissed the claim under the Equal Protection Clause by applying a rational basis standard because commercial fishing fee differentials do not warrant a higher level of scrutiny. The Court held that California's interest in receiving compensation for the benefits it provides to nonresidents is sufficiently a rational basis for the fee differentials.
Dissent: The dissenting opinions argued that there are unnamed class members that paid substantially more in California income taxes than the named plaintiffs, an argument raised by the plaintiffs for the first time during oral argument to the en banc panel. Based on this rationale, the dissenting opinions argued that the out-of-state commercial fishers should be protected under the Privileges and Immunities Clause from having to pay the differential fees.

To read the full opinion, please visit: https://cdn.ca9.uscourts.gov/datastore/opinions/2016/12/21/13-17358.pdf
En Banc Panel: Sidney R. Thomas, Chief Judge, and Stephen Reinhardt, Kim McLane Wardlaw, William A. Fletcher, Marsha S. Berzon, Milan D. Smith, Jr., Mary H. Murguia, Jacqueline H. Nguyen, Andrew D. Hurwitz, John B. Owens, and Michelle T. Friedland, Circuit Judges
Argument Date: June 21, 2016
Date of Issued Opinion: December 21, 2016
Docket Number: No. 13-17358
Decided: Reversed and Remanded
Case Alert Author: Steve Kim
Counsel: M. Elaine Meckenstock (argued) and Gary Alexander, Deputy Attorneys General; Annadel A. Almendras, Supervising Deputy Attorney General; Robert W. Byrne, Senior Assistant Attorney General; Kamala D. Harris, Attorney General; Office of the Attorney General, Oakland, California; for Defendant-Appellant
Stuart G. Gross (argued) and Jared M. Galanis, Gross Law, San Francisco, California; Todd R. Gregorian and Tyler A. Baker, Fenwick & West LLP, Mountain View, California; for Plaintiffs-Appellees
Author of Opinion: Judge Fletcher
Dissents: Judges Smith, Hurwitz, Owens, Reinhardt, and Berzon
Circuit: Ninth
Case Alert Supervisor: Philip L. Merkel

    Posted By: Glenn Koppel @ 03/08/2017 07:11 PM     9th Circuit     Comments (0)  

March 3, 2017
  Briseno v. ConAgra Foods, Inc. - Ninth Circuit
Headline: Ninth Circuit panel holds FRCP Rule 23 does not require named plaintiffs to proffer an administratively feasible way to identify class members as a prerequisite for class certification.

Areas of Law: Civil Procedure, Class Actions

Issues Presented: Whether class representatives must demonstrate there is an "administratively feasible" means of identifying absentee class members to a class action lawsuit under Federal Rules of Civil Procedure ("FRCP") Rule 23.

Brief Summary: Plaintiff-Appellee Robert Briseno, the named plaintiff in a class action complaint, along with other class members, sued Defendant-Appellant ConAgra Foods, Inc. ("ConAgra") for state-law claims for damages arising from an alleged misrepresentation on Wesson cooking oil products that it sold and marketed as 100% natural. The district court certified the class action as a 23(b)(3) class and ConAgra timely appealed under FRCP Rule 23(f). ConAgra contended the class should not have been certified as a class action because class representatives did not demonstrate an administratively feasible way to identify other class members, defined as those who had purchased Wesson cooking products within the class period. A panel for the Ninth Circuit reviewed the text of FRCP Rule 23 and concluded that a showing of administrative feasibility is not a prerequisite for class certification under Rule 23(a). Accordingly, the panel joined the Sixth, Seventh and Eight Circuits in rejecting the Third Circuit's recognition of an administrative feasibility requirement, holding that the Third Circuit's policy concerns are addressed by the enumerated requirements within the rule itself and that the drafters and the Supreme Court did not intend for courts to add requirements to be assessed a vacuum.

Significance: When plaintiffs seek to certify a class action they are not required to provide an administratively feasible way to identify class members as a condition for class action certification under FRCP Rule 23. The Ninth Circuit panel joins the Six, Seventh, and Eighth Circuits in limiting the requirements of class action certification to those enumerated within the rule itself, and rejecting the Third Circuit's justification that administrative feasibility should be shown to make certain the class can function as a class.

Extended Summary: Defendant-Appellant ConAgra markets, manufactures, sells, and distributes Wesson food products to multiple states within the United States. Plaintiff-Appellee Robert Briseno and other class members argued that ConAgra misrepresented certain Wesson cooking oil products when it labeled them as 100% natural because the products contained (and still contain) bioengineered ingredients which make them unnatural. Plaintiffs asserted state-law claims against ConAgra and filed class action complaints in eleven states which were ultimately consolidated into this action. The district court held that defining class members as those who purchased Wesson oil during the class period sufficiently identified the class for class certification purposes, and it granted Plaintiff's motion to proceed with damages claims in eleven states under FRCP Rule 23(b)(3).
To obtain class certification, the four requirements of Rule 23(a) (numerosity, commonality, typicality, and adequacy of the class representative) and at least one requirement of Rule 23(b) must be met. ConAgra argued that, in addition to these enumerated requirements, class proponents must demonstrate that there is an administratively feasible way to determine who is in the class and that plaintiffs did not meet this additional requirement.
The Ninth Circuit panel used "traditional rules of statutory construction" to interpret the plain language of the Rule 23(a), which provides:
"One or more members of a class may sue or be sued as representative parties on behalf of all members only if:
(1) the class is so numerous that joinder of all members is impracticable;
(2) there are questions of law or fact common to the class;
(3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and
(4) the representative parties will fairly and adequately protect the interests of the class."
The panel concluded that drafters' enumeration of "prerequisites" implies that Rule 23(a) constitutes an exhaustive list reasoning that the drafters must have intentionally omitted anything they did not consider a true prerequisite for the class action to be certified. The Supreme Court also affirmed a close reading of Rule 23 text in Amchem Products, Inc. v. Windsor, 521 U.S. 591 (1997) holding that "Federal courts . . . lack authority to substitute for Rule 23's certification criteria a standard never adopted." The panel found that imposing an additional showing of administrative feasibility would deviate from the Supreme Court's guidance.
The panel addressed and rejected the three rationales behind the Third Circuit's administratively feasible requirement (1) mitigating administrative burdens, (2) protecting bona fide and present class members from fraudulent claims, and (3) protecting due process rights of defendants.
The Third Circuit requires an administratively feasible means to identify class members because of the need to mitigate administrative burdens imposed when litigating a Rule 23(b)(3) class action which requires notice that a class has been certified and an opportunity for absent class members to withdraw from the class. However, the panel found that Rule 23(b)(3)'s manageability criterion of the superiority requirement, which specifically mandates that courts consider "the likely difficulties in managing a class action," already provides a specifically enumerated mechanism that addresses judicial efficiency and administrative burdens in managing class actions. Adopting a freestanding administrative feasibility requirement, instead of evaluating manageability as one component of the superiority requirement, would conflict with Rule 23(b)(3)'s call for a comparative assessment of the costs and benefits of class adjudication, including the availability of "other methods" for resolving the controversy, thereby inviting courts to consider the administrative burdens of class litigation "in a vacuum." The panel observed that the "authors of Rule 23 opted not to make the potential administrative burdens of a class action dispositive and instead directed courts to balance the benefits of class adjudication against its costs."
The panel did not find the Third Circuit's concern for providing individual notice to absentee class members compelling because neither Rule 23 nor due process requires actual notice to class members. The text of the rule requires individuals to be identified by reasonable effort and be provided with the best notice under the circumstances. The due process clause also allows for an alternative means of notice, such as publication, third party notice, and paid advertising. The risk that an absentee class member will not be notified and therefore not have the option to opt out, as required for a 23(b)(3) class action, is minimal because the types of actions that proceed as 23(b)(3) claims often involve low-value consumer products where individual recoveries are low and not likely to entice one to pursue individual litigation. Similarly, because recovery amounts tend to be low, it is unlikely individuals would submit illegitimate claims that could dilute the claims of legitimate claimants.
Finally, the Third Circuit's due process concern that defendants have an opportunity to dispute whether claimants actually bought their product is addressed by the fact that the defendant can raise damages issues at the certification stage, challenging the class plaintiff's Article III standing, and, if certification is granted, throughout the course of the litigation. . Furthermore, after the class action has been adjudicated, defendants will have the opportunity "to individually challenge the claims of absent class members if and when they file claims for damages." .
The panel further noted that "identification of class members will not affect a defendant's liability in every case." In this case, for example, where the aggregate damages are calculated by multiplying the price premium for the allegedly false statement on each unit sold by the total units sold during the class period, "the identity of particular class members does not implicate the defendant's due process interest at all" because adding and subtracting claimants does not change its aggregate liability.
The text of Rule 23 does not explicitly require nor does it imply that named plaintiffs must show an administratively feasible way to identify absent class members. The Third Circuit's policy arguments for imposing this additional requirement have already been addressed within the parameters of the rule itself. The district court did not error in its class certification of this action.
To read the full opinion, please visit:

http://cdn.ca9.uscourts.gov/da...17/01/03/15-55727.pdf

Panel: William A. Fletcher, Morgan B. Christen, and Michelle T. Friedland, Circuit Judges.

Argument Date: September 12, 2016

Date of Issued Opinion: January 3, 2017

Docket Number: 15-55727

Decided: Affirmed. The district court did not error in deciding plaintiffs do not need to show an administratively feasible means of identifying class members as a condition for class certification.

Case Alert Author: Amanda Cline

Counsel: Angela Spivy (argued), McGuireWoods LLP, Atlanta Georgia; R. Trent Taylor, McGuireWoods LLP, Richmond, Virginia; E. Rebecca Gantt, McGuireWoods LLP, Norfolk, Virginia; A. Brooks Gresham and Laura E. Coombe, McGuireWoods LLP, Los Angeles, California; for Defendant-Appellant.
Adam Levitt (argued) and Edmund S. Aronowitz, Grant & Eisenhofer P.A., Chicago, Illinois; Mary S. Thomas, Grant & Eisenhofer P.A., Wilmington, Deleware; Ariana J. Tadler, Henry J. Kelston, Meagan Keenan, and Carey Alexander, Milberg LLP, New York, New York; David E. Azar, Milberg LLP, Los Angeles, California; for Plaintiff-Appellee.

Author of Opinion: Judge Friedland

Circuit: Ninth Circuit

Case Alert Supervisor: Glenn Koppel

    Posted By: Glenn Koppel @ 03/03/2017 06:46 PM     9th Circuit     Comments (0)  

  Pepper v. Apple Inc. - Ninth Circuit
Headline: The Ninth Circuit Panel held that reviewing courts should be "forgiving" of a district court's failure to follow Rule 12(g)(2), when granting late-filed Rule 12(b)(6) motions and held customers who buy iPhone applications are "direct purchasers" for purposes of standing in an antitrust suit against Apple, Inc.

Areas of Law: Federal Rules of Civil Procedure, Antitrust, Statutory Standing

Issues Presented: The panel's opinion focused on two questions. First, whether the district court erred in granting Apple's fourth motion to dismiss asserting the defense of lack of standing, when Rule 12(g)(2) by its terms may have barred Apple's motion because that defense was omitted from Apple's previous Rule 12 motion. Second, whether the plaintiffs were direct purchasers of Apple's iPhone applications within the meaning of Illinois Brick.

Brief Summary: Plaintiffs brought a putative antitrust class action against Apple alleging monopolization, attempted monopolization, and conspiracy between Apple and AT&T Mobility LLC to monopolize the voice and data services market for iPhones. Plaintiffs that Apple has monopolized and attempted to monopolize the market for iPhone apps and further alleged that they were direct purchasers . Plaintiffs allege that claimed that were "direct purchasers" of Apple's iPhone applications and thus suffered financial injury sufficient to satisfy Article III standing, as well as satisfying the statutory standing per Illinois Brick.

Plaintiffs claim Rule 12(g)(2) should have barred Apple's late-filed 12(b)(6) motion because Apple omitted its lack-of-standing defense from an earlier Rule 12 motion; therefore, the district court erred when ruling on Apple's 12(b)(6) motion. Noting a disagreement among the Circuits on the proper interpretation and application of Rule 12(g)(2), the panel sided with the Third and Tenth Circuits in concluding that the district court may have failed to apply Rule 12(g)(2), but the error was harmless and should be forgiven since the intent and policy of the Federal Rules are to ensure "just, speedy, and inexpensive determination of every action and proceeding." By ruling on the merits of Apple's Rule 12(b)(6) motion, the district court "materially expedited the district court's disposition of the case, which was a benefit to both parties." The panel found that Rule 12(g)(2) was designed to punish parties who unduly delay trial by strategically not filing motions, and Apple was found to have filed the motions in a timely manner. Therefore, any procedural error was harmless, and the panel then focused on the merits of the decision.

The United States Supreme Court case Illinois Brick stated, "the overcharged direct purchaser, and not others in the chain of manufacturer or distribution," has standing to sue. The panel held Apple, and not the third-party developers, were the direct distributors of iPhone apps, so that the plaintiffs were direct purchasers of iPhone apps from Apple under Illinois Brick and, therefore, have standing to sue. The panel reversed the district court's decision on the merits, and remanded the case for further proceedings.

Significance: Owners of iPhones who purchase iPhone applications are now considered direct purchasers from Apple's "App Store." Purchasers now have standing to sue since Apple has the exclusive authority to sell the product at a price Apple sets, making the argument for antitrust violation sustainable in court. If plaintiffs prevail on remand this may allow third-party developers to sell the applications they created at a more competitive price outside the "App Store."

Extended Summary: In 2007, Apple Inc. released the iPhone. Apple allowed its customers to search, purchase, and download applications (apps) from Apple's "App Store." Some apps were created by Apple, but most were produced by third-party developers. Of the apps sold, Apple earned 30% commission and the other 70% of the sale price went to the developers. Apple strictly prohibited developers from going outside of Apple's App Store to sell their apps and threatened the developers who violated this prohibition by cutting off their sales. In addition, Apple discouraged iPhone users from downloading unapproved apps from other sources, and disciplined them by voiding their warranties.

On December 29, 2011, four named plaintiffs filed a putative antitrust class action complaint ("Complaint 1") against Apple alleging monopolization and attempted monopolization of the app market. Because the plaintiffs did not join AT&T Mobility, LLC ("ATTM") as a party, for the conspiracy count of the complaint, Apple moved to dismiss the entire complaint under Rule 12(b)(7). Apple's motion was deemed moot when the district court consolidated the action with another action.

On March 21, 2012, seven named plaintiffs filed another putative class action complaint ("Complaint 2") against Apple, alleging the same counts as those in Complaint 1. Complaint 2 also failed to join ATTM as a defendant. On April 16, 2012, Apple moved to dismiss the entire complaint under Rule 12(b)(7) and in the alternative under Rule 12(b)(6). The district court granted the motion to dismiss without prejudice, but ordered the plaintiffs either to add ATTM as a defendant or to drop the conspiracy count of the complaint. The district court deemed Apple's Rule 12(b)(6) motion premature.

The plaintiffs third complaint ("Complaint 3") was the same as Complaint 2, except it was labeled "Preserved for Appeal." At this point in the proceedings, none of the named plaintiffs alleged that they had ever purchased or sought to purchase, iPhone apps and ATTM was still not a named defendant. Apple moved under Rule 12(f) to strike the conspiracy claim, and the district court granted the motion. For the first time, Apple moved under Rule 12(b)(1) for lack of Article III standing and under Rule 12(b)(6) stating plaintiffs lacked statutory standing under Illinois Brick. Plaintiffs relying on Rule 12(g)(2) opposed Apple's motion to dismiss.

In the Fourth and final complaint ("Complaint 4"), plaintiffs alleged they had purchased iPhone apps giving them Article III standing to sustain their monopolization claims. In addition, they responded to Apple's defense of lack of statutory standing under Illinois Brick by alleging their status as "direct purchasers" from Apple. Apple filed a motion under Rule 12(b)(6) contending the plaintiffs lacked statutory standing. The district court granted the motion and dismissed the entire complaint with prejudice. Plaintiffs timely appealed.

Plaintiffs argue that Rule 12(g)(2) should have barred Apple from raising the Illinois Brick statutory standing defense when Apple raised four different Rule 12 motions to dismiss and that the district court erred in deciding the motion on the merits.. Rule 12(g)(2) provides "that a party that makes a motion under this rule must not make another motion under this rule raising a defense or objection that was available to the party but omitted from its earlier motion." The Ninth Circuit panel recognized a split among the circuits regarding proper interpretation and application of Rule 12(g)(2). The panel disagreed with the Seventh Circuit's holding that Rule 12(g)(2) does not foreclose a motion to dismiss under Rule 12(b)(6) when there has been a previous motion to dismiss under Rule 12. Agreeing with the Third and Tenth Circuits, the panel held that, strictly applied, Rule 12(h)(2) required Apple to answer the complaint and then make a Rule 12(c) motion for judgment on the pleadings. However, where there is no evidence of a defendant's intent to delay proceedings, the court of appeals, should be forgiving of a district courts failure to strictly follow Rule 12(g)(2)..

The panel applied Rule 12(g)(2) in light the general policy expressed in Rule 1 that federal courts should construe the Federal Rules in a way that ensures a "just, speedy, and inexpensive determination of every action and proceeding." Though Rule 12(g) "technically prohibits successive motions," its purpose was to punish parties whose intent is to delay court proceedings, practice ambush tactics, and extend costly litigation. In the present litigation, the panel held that Apple's motions did not appear to be filed for any "strategically abusive purpose" and that Apple made their motions in timely manners. Further, if the district court properly followed Rule 12(g)(2), the alternative avenues for Apple would have "substantially delayed" resolutions of the issues. Therefore, the panel held the late filed 12(b)(6) motion, which was granted by the district court, was harmless, despite the failure to follow Rule 12(g)(2).

The district court ruled on the merits stating that the plaintiffs were not "direct purchasers" under Illinois Brick. Illinois Brick held that only "the direct purchaser, and not others in the chain of manufacture or distribution," has standing to sue. The direct purchaser rule originated in Hanover Shoe v. United Shoe Machinery Co., 392 U.S. 481 (1968) in which the Supreme Court held that, for purposes of antitrust damages, the direct purchaser is injured by the full amount of the overcharge irrespective of who ultimately bears the cost of that injury. Hanover Shoe and Illinois Brick, the consumer was an indirect purchaser from the manufacturer because the intermediary was the party who actually sold to the consumer. In distinguishing these cases, the panel held that Apple was a distributor who sold directly to plaintiffs. The panel analogized this case to Ticketmaster, an Eighth Circuit case in which purchasers bought concert tickets directly from Ticketmaster. Though the Eighth Circuit held plaintiffs were indirect purchasers the panel believed that ruling to be in error. Instead the panel, focused on the rule in Illinois Brick, which stated, "the distributor who supplies the product directly to the plaintiffs, rather than the producer of the product, is the appropriate defendant in an antitrust suit." In Ticketmaster, the plaintiffs directly purchased the ticket distribution service from Ticketmaster, just like the plaintiffs here, bought iPhone apps directly from Apple. Plaintiffs have no say in price, nor do the developers have any control over Apple's commission. The panel deemed Apple the distributor of the iPhone apps that sold directly to the plaintiffs thorough their app store. Therefore, the plaintiffs are direct purchasers under Illinois Brick and have standing to sue Apple for the alleged monopolization and attempted monopolization of the sale of iPhone apps.

To read the full opinion, please visit: http://cdn.ca9.uscourts.gov/da...17/01/12/14-15000.pdf

Panel: A. Wallace Tashima and William A. Fletcher, Circuit Judges, and Robert W. Gettleman, District Judge

Argument Date: February 10, 2016

Date of Issued Opinion: January 12, 2017

Docket Number: 14-15000

Decided: Reversed and Remanded

Case Alert Author: David T. Griego

Counsel: Mark C. Rifkin (argued), Alexander H. Schmidt, and Michael Liskow, Wolf Haldenstein Alder Freeman & Herz LLP, New York, New York; Francis M. Gregorek and Rachele R. Rickert, Wolf Haldenstein Adler Freeman & Herz LLP, San Diego, California; for Plaintiffs-Appellants

Daniel M. Wall (argued), Christopher S. Yates, and Sadik Huseny, Latham & Watkins LLP, San Francisco, California; J. Scott Ballenger, Latham & Watkins LLP, Washington, D.C.; for Defendant-Appellee

Author of Opinion: Judge W. Fletcher

Circuit: Ninth

Case Alert Supervisor: Professor Glenn Koppel

    Posted By: Glenn Koppel @ 03/03/2017 06:44 PM     9th Circuit     Comments (0)  

  Norcia, et al. v. Samsung Telecommunications America, LLC - Ninth Circuit
Headline: Ninth Circuit panel, applying California contract law, declined to enforce the arbitration provision in a brochure contained in a Samsung phone box's Product & Safety Warranty Information brochure, holding that California courts have not adopted the Seventh Circuit's view that arbitration clauses contained in in-the-box contracts are enforceable.

Areas of Law: Contract Law, Arbitration Clause, Warranty Law

Issues Presented: Whether an arbitration clause in a Product & Safety Warranty Information brochure included in the box of a phone created a binding contract between the phone purchaser and the phone manufacturer to arbitrate the purchaser's claim; and (2) whether a Customer Agreement signed by the product seller created a binding contract between the phone purchaser and the phone manufacturer to arbitrate the purchaser's claim.

Brief Summary: The Ninth Circuit panel affirmed the district court's order denying Samsung's motion to compel arbitration of a class action complaint alleging that Samsung made misrepresentations as to the performance of the Galaxy S4 phone. Samsung moved to compel arbitration of the dispute on the ground that an arbitration provision, contained in a warranty brochure in the Galaxy 4S box, was binding on plaintiff.

The panel applied California contract law and held that Samsung failed to demonstrate the applicability of any exception to the general California rule that an offeree's silence does not constitute consent. The panel further held that the brochure was not enforceable as an "in-the-box" contract ruling that, even if a customer may be bound by an in-the-box contract under certain circumstances, such a contract is ineffective where the brochure entitled "Product & Safety Warranty Information" did not give the purchaser notice that the brochure contained a freestanding obligation outside the scope of the warranty.

The panel also rejected Samsung's argument that the plaintiff agreed to arbitrate his claims by signing a Customer Agreement with Verizon Wireless. The panel concluded that Samsung failed to bear its burden of establishing that it was a third party beneficiary of the Customer Agreement, and therefore Samsung could not enforce the arbitration provision in the agreement.

Significance: Finding that California contract law has not adopted the Seventh Circuit's view that a brochure containing an arbitration clause is enforceable as an in-the-box contract, the Ninth Circuit panel concluded that an arbitration provision in a Product Safety & Warranty Information brochure was not enforceable because (1) the box it was contained in did not notify the consumer that opening the box would be considered agreement to the terms set forth in the brochure; and (2) the brochure would not have put a reasonable person on notice that the brochure contained a freestanding obligation outside the scope of the warranty.

Extended Summary: Plaintiff-Appellee Daniel Norcia ("Norcia") purchased a Samsung Galaxy S4 phone at a Verizon Wireless store. Upon purchasing the phone, a Verizon Wireless employee provided a receipt entitled "Customer Agreement." The receipt stated (in all capital letters), in pertinent part: "I understand that I am agreeing to . . . settlement of disputes by arbitration and other means instead of jury trials, and other important terms in the Customer Agreement." The Customer Agreement did not reference Samsung or any other party. Norcia signed the Customer Agreement. Norcia left the store with the phone, the phone charger, and the headphones, but he declined the offer by the Verizon Wireless employee to take the box and the rest of its contents. The back of the Galaxy S4 box stated: "Package Contains . . . Product Safety & Warranty Brochure."

Section 2 of the "Product Safety & Warranty Information" brochure contained Samsung's "Standard Limited Warranty" and "End User License Agreement for Software." The warranty section included the following (in all capital letters): "All disputes with Samsung arising in any way from this limited warranty or the sale, condition or performance of the products shall be resolved exclusively through final and binding arbitration, and not by court or jury." Further down Section 2 a paragraph explained the procedures for arbitration and stated that purchasers could opt out of the arbitration agreement by providing notice to Samsung within 30 calendar days of purchase, either through email or by calling a toll-free telephone number. Norcia did not take any steps to opt out.

Norcia filed a class action complaint against Samsung Telecommunications America, LLC, and Samsung Electronics America, Inc., (collectively, "Samsung"), alleging that Samsung misrepresented the Galaxy S4's storage capacity and rigged the phone to operate at a higher speed when it was being tested. The complaint sought certification of the case as a class action for all purchasers of the Galaxy S4 phone in California. Norcia did not bring any claims for breach of warranty.

Samsung moved to compel arbitration by invoking the arbitration provision in the Product Safety & Warranty Information brochure. The district court denied Samsung's motion, holding that even though Norcia should be deemed to have received the Galaxy S4 box, including the Product Safety & Warranty Information brochure, the receipt of the brochure did not form an agreement to arbitrate non-warranty claims. Samsung timely appealed the district court's order.

"[A]rbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit." AT&T Techs., Inc. v. Commc'ns Workers of Am., 475 U.S. 643, 648 (1986). Therefore, in order to evaluate the district court's denial of Samsung's motion to compel arbitration, the panel first determined "whether a valid agreement to arbitrate exists." Chiron Corp. v Ortho Diagnostic Sys., Inc., 207 F.3d 1126, 1130 (9th Cir. 2000).

Samsung raises two theories of contract formation to support its argument that Norcia entered into a binding contract with Samsung to arbitrate his claims. First, Samsung claims that the inclusion of the arbitration provision in the Product Safety & Warranty Information brochure created a valid contract between Samsung and Norcia to arbitrate all claims related to the Galaxy S4 phone. Second, Samsung contends that the Customer Agreement signed by Norcia incorporated the terms of its Product Safety & Warranty Information brochure by reference and created a binding contract between Norcia and Samsung.

Samsung's first argument that the arbitration provision in the Product Safety & Warranty Information brochure created a binding contract between Samsung and Norcia.

Here, contract law governed the panel's analysis, as Norcia's complaint involves a non-warranty dispute. "A contract for sale of goods may be made in any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of such a contract." Cal. Com. Code § 2204(1). California courts have long held that "[a]n offer made to another, either orally or in writing, cannot be turned into an agreement because the person to whom it is made or sent makes no reply, even though the offer states that silence will be taken as consent, for the offerer cannot prescribe conditions of rejection so as to turn silence on the part of the offeree into acceptance." Leslie v. Brown Bros. Inc., 208 Cal. 606, 621 (1929).

There are exceptions to this rule, however. An offeree's silence may be deemed to be consent to a contract when the offeree has a duty to respond to an offer and fails to act in the face of this duty. Golden Eagle, 20 Cal. App. 4th at 1386 (1993). Additionally, an offeree's silence may also be treated as consent to a contract when the party retains the benefit offered. See Id.; see also Cal. Civ. Code § 1589. Even if there is an applicable exception to the general rule that silence does not constitute acceptance, courts have rejected the argument that an offeree's silence constitutes consent to a contract when the offeree reasonably did not know that an offer had been made. The court in Windsor Mills, Inc. v. Collins & Aikman Corp. held that "an offeree, regardless of apparent manifestation of his consent, is not bound by inconspicuous contractual provisions of which he was unaware, contained in a document whose contractual nature is not obvious." 25 Cal. App. 3d 993, 993 (1972).

Samsung failed to demonstrate the applicability of any exception to the general California rule that an offeree's silence does not constitute consent. Because Norcia did not give any "outward manifestations of consent [that] would lead a reasonable person to believe the offeree has assented to the agreement," Knutson, 771 F.3d at 565, the panel concluded that no contract was formed between Norcia and Samsung, and Norcia is not bound by the arbitration provision contained in the brochure.

Samsung argued that Norcia was bound by the terms set forth in the brochure because the brochure is analogous to a shrink-wrap license, which was held enforceable in California, see Wall Data Inc. v. L.A. Cty. Sheriff's Dep't, 447 F.3d 769 (9th Cir. 2006). The court previously defined a "shrink-wrap license" as "a form on the packing or on the outside of the CD-ROM containing the software which states that by opening the packaging or CD-ROM wrapper, the user agrees to the terms of the license." Id. at 775. The panel held that even if a license to copy software could be analogized to a brochure that contains contractual terms, the outside of the Galaxy S4 box did not notify the consumer that opening the box would be considered agreement to the terms set forth in the brochure. Accordingly, Wall Data does not support Samsung's argument that Norcia was bound by the brochure contained in the Galaxy S4 box.

Samsung also argued that the terms set forth in the brochure are analogous to terms included in a box sent to the consumer (an "in-the-box" contract), which the Seventh Circuit has also held to be enforceable in Hill v. Gateway 2000, Inc., 105 F.3d 1147, 1148 (7th Cir. 1997). Samsung claimed that California courts have adopted the reasoning expressed in Hill, citing Weinstat v. Dentsply International Inc., 180 Cal. App. 4th 1213 (2010). However, Samsung misapplied Weinstat, as the case focused on warranty formation under section 2313 of the California Commercial Code, not on contract formation. Accordingly, Weinstat did not adopt the rule stated in Hill, that statements in a brochure enclosed in a product box create a contract between the seller and the consumer that can limit the consumer's rights to bring legal actions against the manufacturer for claims involving an express warranty.

Samsung also relied on a Second Circuit case, Schnabel v. Trilegiant Corp., 697 F.3d 110 (2d Cir. 2012), to support its argument that California courts have adopted the reasoning in Hill for enforcing in-the-box contracts. Schnabel noted that holding licenses in a product box as enforceable contracts "do[es] not nullify the requirement that a consumer be on notice of the existence of a term before he or she can be legally held to have assented to it." Id. at 24. The panel held that the information provided in Samsung's brochure would not have put a reasonable person in Norcia's position on notice that the brochure contained a freestanding obligation outside the scope of the warranty. Nor would a reasonable person understand that receiving the seller's warranty and failing to opt out of an arbitration provision contained within the warranty constituted assent to a provision requiring arbitration of all claims against the seller, including claims not involving the warranty. Samsung's inclusion of a brochure in the Galaxy S4 box, and Norcia's failure to opt out, does not make the arbitration provision enforceable against Norcia.

Samsung's second argument that the Customer Agreement signed by Norcia created a binding contract between Norcia and Samsung.

The Customer Agreement was an agreement between Verizon Wireless and its customer. Samsung was not a signatory. Samsung argued that it may enforce the arbitration agreement because it is a third-party beneficiary of the agreement, however, the parties to the contact must have intended the third party to benefit and Samsung did not point to any evidence in the record indicating that Norcia and Verizon Wireless intended the Customer Agreement to benefit Samsung. Samsung failed to meet its burden of establishing that it was a third-party beneficiary.

The district court's order denying Samsung's motion to compel arbitration of a class action was affirmed.

To read the full opinion, please visit:

http://cdn.ca9.uscourts.gov/da...017/01/19/14-16994.pdf

Panel: Sidney R. Thomas, Chief Judge, and Carlos T. Bea and Sandra S. Ikuta, Circuit Judges.

Argument Date: October 17, 2016

Date of Issued Opinion: January 19, 2016

Docket Number: 3:14-cv-00582-JD

Decided: Affirmed

Case Alert Author: Brandon Homan

Counsel: John R. Hurley (argued), Eduardo G. Roy, Daniel C. Quintero, and Jill Dessalines, Prometheus Partners L.L.P., San Francisco, California, for Plaintiff-Appellee. Sean D. Unger (argued), John P. Phillips, and Ryan C. Nier, Paul Hastings LLP, San Francisco, California, for Defendants-Appellants.

Author of Opinion: Circuit Judge Sandra S. Ikuta

Circuit: Ninth

Case Alert Supervisor: Professor Glenn Koppel

    Posted By: Glenn Koppel @ 03/03/2017 06:42 PM     9th Circuit     Comments (0)  

  New York Pet Welfare Ass'n, Inc. v. New York City - Second Circuit
Headline: Second Circuit Upholds New York City Animal Welfare Laws Aimed at Controlling Overpopulation of Cats and Dogs

Area of Law: Animal Law, Commerce Clause, State & Federal Preemption

Issue(s) Presented: Whether newly-enacted New York City animal welfare laws are preempted by state or federal law or violate the dormant Commerce Clause.

Brief Summary: Plaintiff-appellant brought suit against New York City in the United States District Court for the Eastern District of New York to challenge two New York City animal welfare laws enacted in 2015. Plaintiff-appellant, the New York Pet Welfare Association, alleged that one law, requiring New York City pet shops to buy dogs and cats only directly from a specific class of federally-licensed breeders, violated the dormant commerce clause. In addition, plaintiff-appellant alleged that the federal Animal Welfare Act preempted this law. Second, plaintiff-appellant alleged that New York law preempted a second animal welfare law that required pet stores to sterilize dogs and cats before consumers could purchase them.

The district court held that plaintiff-appellant's Commerce Clause challenge failed because the laws did not "discriminate against or unduly burden interstate commerce." The district court also found that neither federal law nor New York state law preempted the City's animal welfare laws. Plaintiff-appellant appealed, and the Second Circuit affirmed the district court's dismissal.

To read the full opinion, please visit: http://www.ca2.uscourts.gov/de...adf82ec74c6/2/hilite/.

Extended Summary: This case concerns animal welfare laws that aim to protect the approximately 1.1 million dogs and cats that reside in New York City. In 2015, defendant-appellant New York City (the "City") drafted a series of animal welfare laws aimed at the breeding of dogs and cats, their subsequent sale, and the unfortunate issue of overpopulation. Before the laws took effect, plaintiff-appellant, the New York Pet Welfare Association, sued the City in the United States District Court for the Eastern District of New York, challenging two of the laws: the "Sourcing Law" and the "Spay/Neuter Law."

The Sourcing Law required that City pet stores sell only animals from a specific class of federally-licensed breeders, while the Spay/Neuter Law required pet stores to spay and neuter the animals before selling them. Plaintiff-appellant alleged that the Sourcing Law violated the Commerce Clause and was preempted by the federal Animal Welfare Act ("AWA and alleged that the Spay/Neuter Law was preempted by New York state law. The district court dismissed the complaint in its entirety, and plaintiff-appellant appealed to the Second Circuit.

In its analysis, the Second Circuit explained that the AWA covers any "person who, in commerce, for compensation or profit, delivers for transportation, or transports, except as a carrier, buys, or sells, or negotiates the purchase or sale of . . . any dog or other animal . . . [for] use as a pet." The AWA gives wide discretion to the Secretary of Agriculture to form a licensing scheme and set standards. With this discretion, the Secretary created three categories of dealers, Classes A-C. Despite the AWA's broad scope, by the Act's express terms, states may still promulgate standards in addition to those set by the Secretary. States have taken the initiative to regulate large-scale breeders and require pet stores to strengthen their warranties and provide more disclosures about the pets they sell.

Plaintiff-appellant argued that the AWA preempted the Sourcing Law because it interfered with the AWA's established licensing systems. The Second Circuit rejected this argument, holding that plaintiff-appellant did not meet its burden in proving that the two laws could not stand together. Specifically, the court noted that plaintiff-appellant failed to show how the Sourcing Law prohibited the Secretary of Agriculture's licensing system from fulfilling Congress's intended goal of inspection. The Court differentiated between the Sourcing Law's goal of regulating sales by a federally-licensed class and the AWA's ability to "facilitate federal enforcement activities." Since Congress directed the Secretary to cooperate with state officials in promulgating and enforcing state animal welfare laws, Congress, the Second Circuit concluded, did not intend the AWA to automatically preempt any proposed state laws.

The Second Circuit likewise rejected plaintiff-appellant's argument that the Sourcing Law's violated the Commerce Clause. As an initial matter, the court determined that the Sourcing Law did not discriminate against interstate commerce. The court stated that the law posed only an incidental burden on commerce because even if the law made it difficult for some out-of-state breeders to sell to City pet stores, as long as some breeders are able to this does not constitute an impermissible burden on interstate commerce overall.

Regarding the Spay/Neuter Law, plaintiff-appellant argued that, because the law set a certain minimum age and weight for required sterilization, these standards conflicted with and were preempted by New York state law dictating that veterinarians should apply independent judgment and obtain informed consent from the owner before performing the surgeries. However, the Second Circuit found no preemption because the Spay/Neuter Law did not impose any obligations on veterinarians who, the court said, could simply refuse to perform any surgeries that they felt would violate their duties under state law.

As a result, the Second Circuit affirmed the lower court's decision dismissing plaintiff-appellant's complaint in its entirety.

To read the full opinion, please visit: http://www.ca2.uscourts.gov/de...adf82ec74c6/2/hilite/.

Panel (if known): Circuit Judges Leval and Lohier, and District Judge Korman

Argument Date: 09/19/16

Date of Issued Opinion: 03/02/17

Docket Number:
No. 15-4013-cv

Decided: Affirmed.

Case Alert Author: Samantha Hazen

Counsel: Jeffrey M. Pollock (Nancy Elizabeth Halpern, on the brief), Fox Rothschild LLP, Lawrenceville, NJ (James M. Lemonedes, Fox Rothschild LLP, New York, NY, on the brief), for Plaintiff- Appellant, Benjamin Welikson, of Counsel (Zachary W. Carter, Corporation Counsel, Richard Dearing, Assistant Corporation Counsel, Devin Slack, of Counsel, on the brief), City of New York, New York, NY, for Defendants-Appellees, S. Reid Kahn, Kane Kessler, P.C., New York, NY, for Amicus Curiae The Humane Society of the United States.

Author of Opinion: District Judge Edward R. Korman

Case Alert Circuit Supervisor: Professor Elyse Diamond

    Posted By: Elyse Diamond @ 03/03/2017 02:20 PM     2nd Circuit     Comments (0)  

March 2, 2017
  Billy E. Prince v. Sears Holding Corporation -- Fourth Circuit
Employee Beware--Check Your Mail for Insurability Questionnaires to Avoid ERISA Preemption

Areas of Law: Employee Retirement Income Security Act

Issue Presented: Whether the Employee Retirement Income Security Act ("ERISA") preempts state law claims for misrepresentation, constructive fraud, and infliction of emotional distress.

Brief Summary: Billy E. Prince, an employee of Sears Holding Corporation, brought a suit alleging that Sears improperly administered his late wife's life insurance benefits. Specifically, Mr. Prince brought the suit alleging misrepresentation, constructive fraud, and infliction of emotional distress. The United States Court of Appeals for the Fourth Circuit held that ERISA completely preempted Billy Prince's state law claims under the three prong test articulated in Sonoco Prods. Co. v. Physicians Health Plan, Inc.

Extended Summary: In November 2010, Mr. Prince submitted an application to Sears for $150,000 in life insurance for his wife. Sears administered its life insurance plans through The Prudential Insurance Company of America ("Prudential"). In May 2011, Sears sent Mr. Prince an acknowledgement letter and began withholding premiums from his pay. In late 2011, Mr. Prince's wife learned that she had Stage IV liver cancer. In 2012, Mr. Prince confirmed through his online benefits summary that he had elected to purchase life insurance coverage for his wife in the amount of $150,000. In 2013, however, Sears sent Mr. Prince a letter saying that his wife's coverage never became effective because there was no evidence that Mr. Prince had submitted his insurability questionnaire. According to Sears, Prudential sent Mr. Prince a notice in 2011 stating that if he failed to send in the questionnaire his application for life insurance would be terminated. Mrs. Prince passed away in May 2014.

Mr. Prince filed a complaint against Sears alleging constructive fraud and negligent misrepresentation as well as the intentional and reckless infliction of emotional distress. Concerning the claim of intentional and reckless infliction of emotional distress, Mr. Prince alleged that Sears misrepresented the life insurance policy and that this misrepresentation inflicted harm on him and the late Mrs. Prince. Sears removed the case to the United States District Court for the Northern District of West Virginia and argued that the suit should be dismissed because ERISA completely preempted Mr. Prince's state law claims. The district court agreed.

ERISA's § 502(a) is a broad provision that provides participants and beneficiaries with causes of action for the denial of benefits or rights under an ERISA plan. The Fourth Circuit determined that ERISA can preempt state law causes of action when: (1) a plaintiff has standing under § 502(a) to pursue his claim; (2) the claim falls within the scope of an ERISA provision that ERISA can enforce via § 502(a); and (3) the claim is not capable of resolution without interpreting the ERISA plan. Because Mr. Prince conceded that he had standing, the Fourth Circuit only considered the second and third prongs of the test articulated in Sonoco Products Company v. Physicians Health, Inc.

Under the second prong, Mr. Prince argued that his claims were not preempted because they were dependent upon Sears's actions prior to the denial of benefits when they began deducting premiums from his pay and reported that he had coverage. The court held that regardless of whether Mr. Prince's claims attacked Sears's actions prior to the denial or in issuing the denial, they were preempted because they challenged the administration of the ERISA plan, which is a core §502(a) claim. Additionally, because Mr. Prince's claims addressed only Sears's duties as an ERISA plan administrator, Sears owed Mr. Prince no independent legal duty. Regarding the third prong, Mr. Prince again argued that he was only challenging the actions Sears took prior to the denial of benefits. The court, however, held that the claims of misrepresentation and constructive fraud required an analysis of Sears's "duty" as a plan administrator, which stemmed from the ERISA plan. Similarly, for the claim of emotional distress, determining whether Sears acted in an "outrageous" manner required interpretation of the company's duties and responsibilities under the ERISA plan. Thus, the Fourth Circuit held that ERISA completely preempted Mr. Prince's state law claims, affirmed the judgment of the District Court, and dismissed the complaint.

To read the full opinion, click here.

Panel: Judges Motz, Kennan, and Thacker

Argument Date: 12/06/2016

Date of Issued Opinion: 01/27/2017

Docket Number: No. 16-1075

Decided: Affirmed by published opinion

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

Counsel: Chad Lewis Taylor, SIMMERMAN LAW OFFICE, PLLC, Clarksburg, West Virginia, for Appellant. Jill E. Hall, BOWLES RICE LLP, Charleston, West Virginia, for Appellee. ON BRIEF: Frank E. Simmerman, Jr., SIMMERMAN LAW OFFICE, PLLC, Clarksburg, West Virginia, for Appellant. Gerard R. Stowers, BOWLES RICE LLP, Charleston, West Virginia, for Appellee.

Author of Opinion: Judge Motz

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 03/02/2017 10:31 AM     4th Circuit     Comments (0)  

February 27, 2017
  United States of America v. Dominique Jackson - Third Circuit
Headline: Third Circuit Affirms Conviction Based on "Listening Post" Theory in Wiretap Statute

Area of Law: Pennsylvania Wiretap Statute, Evidence

Issues Presented: Did the District Court erroneously deny pretrial motions to suppress evidence derived from intercepted calls?

Brief Summary:

Defendant Dominique Jackson appealed his conviction for conspiracy to possess with the intent to distribute cocaine. He claimed that the district court erred by denying his pretrial motions to suppress evidence from calls because he claimed the calls were unlawfully intercepted. Defendant argued that the evidence from the wiretaps should have been suppressed because the state court did not have jurisdiction to wiretap cells phones when they were outside of Pennsylvania. The Third Circuit adopted the "listening post" theory, which permits interception of out-of-state calls if the interception itself is located within the jurisdiction of the court authorizing the interception. The Third Circuit reviewed Pennsylvania's wiretap statute and Title III, the federal wiretap statute, and confirmed that Pennsylvania's statute was modeled to be substantially similar to Title III in terms of jurisdiction. Therefore, the state court had authority to grant the wiretap on the evidence from the calls outside of Pennsylvania and the evidence was admissible.

Extended Summary:

Defendant appealed his conviction for conspiracy to possess with the intent to distribute cocaine. Defendant claimed the district court erroneously denied his pretrial motions to suppress evidence from cell phone calls. A Pennsylvania state court had authorized the wiretaps and information from those wiretaps was used in affidavits of probable cause. Intercepted calls were placed and received outside of the state and Defendant contended that the state court lacked subject matter jurisdiction to permit wiretaps outside of Pennsylvania. The jury convicted Defendant of one count of conspiracy to distribute and possess with intent to distribute five or more kilograms of cocaine.

Defendant contended that the evidence from the wiretaps should have been suppressed because the state court did not have jurisdiction over the cellphones when they were outside of Pennsylvania. Defendant maintained that a state's jurisdiction is limited to its borders, and several conversations involving Defendant occurred while the cellphones were located outside of Pennsylvania. The government responded that Defendant lacked standing because, except for six calls which he was a party and had standing to challenge, he was not a party to the intercepted calls. The government also claimed the evidence was admissible under the "listening post" theory, which permits interception of out-of-state calls if the interception itself is located within the jurisdiction of the court authorizing the interception.

The Third Circuit joined other courts of appeals in adopting the "listening post" theory under Title III. The Court reasoned that the Pennsylvania wiretap statute was amended to clarify the definition of "intercept" based on the "listening post" theory. For interception to be lawful, therefore, only the interception had to have been in Pennsylvania. There was no dispute that the interceptions were made in Pennsylvania. The Court, thus, upheld the district court's denial of the motion to suppress.

Defendant also claimed on appeal that the district court erred in not precluding the government's agent, "Countryman," from interpreting the meaning of certain intercepted calls. The government claimed that the phone conversations were unclear and needed interpretation. It also claimed that the testimony involved Countryman's personal observations as a lay witness. The Third Circuit found that Countryman's testimony was not based on his direct knowledge of events. Therefore, he was in no better position than the jury to interpret the calls, and his testimony was overly broad and improper. Although the district court erred in not precluding that evidence, the Third Circuit found that the error was not plain for purposes of granting appellate relief.

Defendant also claimed that the government wrongfully attempted to use two of his co-conspirators' guilty pleas as evidence of Defendant's guilt. The Third Circuit held the government's use of the co-conspirators' guilty pleas was permissible because they went to the heart of whether the co-conspirators were credible, whether the government had selectively prosecuted Defendant, and whether the co-conspirators had firsthand knowledge of the crime for which Defendant was charged. The evidence of the pleas was not offered as substantive evidence of Defendant's guilt. The district court also provided appropriate limiting instructions. Therefore, the district court did not err in allowing the testimony.

Finally, Defendant argued that the district court erred by allowing admission of a co-conspirator's Fifth Amendment privilege not to testify. The Third Circuit held that the prosecutor's mention of the witness's invocation of the Fifth Amendment in front of the jury was inopportune, but was not so serious as to constitute plain error for purposes of appeal.

The Third Circuit, thus, found that Defendant failed to show plain error on appeal and his conviction and sentence were affirmed.

Find the full opinion at:

http://www2.ca3.uscourts.gov/opinarch/143712p.pdf

Panel: Fisher, Krause, and Greenberg, Circuit Judges

Argument Date: Argued December 7, 2016

Date of Issued Opinion: February 24, 2017

Docket Number: No. 14-3712

Decided: Affirmed

Case Alert Author: Jessica Wood

Counsel:

David S. Hickton, United States Attorney, Donovan J. Cocas (argued), Assistant U.S. Attorney, Rebecca R. Haywood, Assistant U.S. Attorney, Michael Ivory, Assistant U.S. Attorney, Counsel for Appellee

F. Clinton Broden (argued), Counsel for Appellant

Author of Opinion: Greenberg, Circuit Judge

Circuit: Third Circuit

Case Alert Supervisor: Professor Mary E. Levy

    Posted By: Susan DeJarnatt @ 02/27/2017 06:54 PM     3rd Circuit     Comments (0)  

February 23, 2017
  Scinto v. Stansberry -- Fourth Circuit
Federal Prisoner's Claims of Improper Medical Care Survive

Areas of Law: Constitutional Law, Eighth Amendment

Issue Presented: Whether the District Court in dismissing three Eighth Amendment claims improperly made credibility determinations and weighed the evidence.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that the United States District Court for District of North Carolina erred in dismissing two Eighth Amendment claims against Dr. Phillip and Administrator McClintock, two employees at the Federal Prison Camp Seymour Johnson. The Fourth Circuit held that Scinto's claim against Dr. Phillip for his denial of insulin and the claim against Administrator McClintock and Dr. Phillip for the failure to provide aid during a medical emergency fit the Supreme Court's two-pronged test in Farmer v. Brennan.

Extended Summary: Paul Scinto, a former federal prisoner, appealed to the Fourth Circuit to review the District Court of North Carolina's dismissal of three Eighth Amendment claims that Defendants Phillip, Stansberry, and McClintock were deliberately indifferent to his medical needs, in violation of the Eighth Amendment. Scinto argued that in dismissing these claims, the district court violated the summary judgment standard by making credibility determinations and weighing the parties' evidence.

The Fourth Circuit noted that when prisoners allege they have been subjected to unconstitutional conditions of confinement, they must satisfy the Supreme Court's two-pronged test in Farmer v. Brennan. The first prong of Farmer's test is an objective prong requiring plaintiffs to demonstrate that "the deprivation alleged [was], objectively "sufficiently serious." The deprivation itself must be "extreme." The second prong of Farmer is a subjective prong, requiring plaintiffs to show that prison officials acted with a "sufficiently culpable state of mind." In order to prove deliberate indifference, plaintiffs must show that "the official kn[ew] of and disregard[ed] an excessive risk to inmate health or safety." Importantly, the Fourth Circuit noted that a plaintiff could make out a prima facie case of deliberate difference by demonstrating "that a substantial risk of [serious harm] was longstanding, pervasive, well-documented, or expressly noted by prison officials[.]"

Regarding Scinto's first claim against Dr. Phillip for allegedly denying him insulin to treat his diabetes, the Fourth Circuit found the plaintiff provided sufficient evidence to establish a genuine dispute of fact as to Farmer's objective and subjective prongs. The court found Scinto did this because he established that he suffered from a serious medical condition and he created a genuine issue of material fact regarding whether Dr. Phillip's failure to provide him with insulin constituted an "extreme deprivation." Additionally, the Fourth Circuit found that plaintiff's lengthy prison medical records showed that his diabetes diagnosis was "longstanding, pervasive, and well-documented." Plaintiff's second claim arose out of Dr. Phillip's and Administrator McClintock's alleged failure to provide him aid during a medical emergency. Specifically, Plaintiff alleged that during a lockdown he experienced extreme stomach pain and began throwing up vomit and blood. The Fourth Circuit held that Plaintiff's evidence created a genuine dispute of fact as to whether the denial of medical attention during this emergency resulted in serious injury or a substantial risk of serious injury. The Fourth Circuit also held that Plaintiff's evidence established genuine disputes of material fact as to both Farmer prongs. Last, regarding Plaintiff's final claim against Warden Stansberry alleging a denial of a proper diabetic diet during his six-month confinement in the Special Housing Unit, the Fourth Circuit affirmed the district court's award of summary judgment for the claim, but not for the reason stated. Instead, the Fourth Circuit held that the Plaintiff failed to raise a genuine dispute of material fact regarding whether the lack of a diabetic diet was a sufficiently serious deprivation actionable under the Eighth Amendment.

In addressing the qualified immunity claims raised by the Defendants, the Fourth Circuit held the Defendant's allegedly violated a clearly established statutory or constitutional right -- a prisoner's right to adequate medical care and freedom from deliberate indifference to medical needs. In addition, the Fourth Circuit found there was sufficient evidence that Plaintiff's aforementioned Eighth Amendment right was violated and that the right was clearly established. Thus, Dr. Phillip and Adminstrator McClintock were not entitled to qualified immunity.

To view the full opinion, click here.

Panel: Judges Niemeyer, Motz, and Wynn

Argument Date: 09/23/2016

Date of Issued Opinion: 11/04/2016

Docket Number: No. 15-1587

Decided:
Affirmed in part and reversed in part.

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

Counsel: ARGUED: Adam H. Farra, COHEN MILSTEIN SELLERS & TOLL PLLC, Washington, D.C., for Appellant. Robert J. Dodson, OFFICE OF THE UNITED STATES ATTORNEY, Raleigh, North Carolina, for Appellees. ON BRIEF: Paul J. Zidlicky, SIDLEY AUSTIN LLP, Washington, D.C., for Appellant. John Stuart Bruce, Acting United States Attorney, G. Norman Acker, III, Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Raleigh, North Carolina, for Appellees.
Author of Opinion: Judge Wynn

Case Alert Supervisor: Professor Renee Hutchins

    Posted By: Renee Hutchins @ 02/23/2017 03:51 PM     4th Circuit     Comments (0)  

  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)  

  Sotnikau v. Lynch -- Fourth Circuit
Involuntary Manslaughter under Virginia Law Is Not a Crime Involving Moral Turpitude

Areas of Law: Criminal Law, Immigration Law

Issue Presented: Whether involuntary manslaughter under Virginia law is categorically a crime involving moral turpitude for the purposes of removal proceedings.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that involuntary manslaughter under Virginia law is not categorically a crime involving moral turpitude, because a defendant can be convicted of the offense upon a showing of criminal negligence. Therefore, the Fourth Circuit concluded that the defendant was not subject to removal pursuant to 8 U.S.C. § 1227(a)(2)(A)(i)(I). The Fourth Circuit vacated the Board of Immigration Appeals' order of removal and remanded for further proceedings.

Extended Summary: Ihar Sotnikau ("Sotnikau") is a native of Belarus who was admitted to the United States as a lawful permanent resident in 2008. On June 18, 2010, Sotnikau and his friend Randy Hines were drinking on a pier along the Elizabeth River in Portsmouth, Virginia. At some point, Hines fell into the river and his body was found the next day. Sotnikau was charged with involuntary manslaughter in the Circuit Court of the City of Portsmouth, Virginia. He pleaded guilty and was sentenced to five years in prison.

In October 2011, the Department of Homeland Security (the "DHS") instituted removal proceedings against Sotnikau under 8 U.S.C. § 1227(a)(2)(A)(i)(I). Under the statute, a removable alien is one who "is convicted of a crime involving moral turpitude committed within five years . . . after the date of admission." The DHS alleged that Sotnikau was convicted of a crime involving moral turpitude, i.e. involuntary manslaughter, committed within five years of being admitted to the United States. Sotnikau contested the DHS's interpretation of Virginia's involuntary manslaughter offense.

In March 2013, the Immigration Judge (the "IJ") concluded that Sotnikau had been convicted of a crime involving moral turpitude, citing the Board of Immigration Appeals' (the "BIA") 1994 decision in In re Franklin, 20 I. & N. Dec. 867 (BIA 1994). In that case, the BIA held that an involuntary manslaughter offense in Missouri constituted a crime involving moral turpitude because "the Missouri statute defined involuntary manslaughter as 'recklessly causing the death of another person.'" The IJ found that, because the mental state required to support a conviction for involuntary manslaughter under Virginia law is identical to the mental state that was at issue in the In re Franklin decision, Virginia's involuntary manslaughter offense is categorically a crime involving moral turpitude. Sotnikau appealed the IJ's decision to the BIA, which affirmed the decision and ordered Sotnikau's removal. Stonikau petitioned the Fourth Circuit for review.

The Fourth Circuit granted relief. In examining whether Virginia's involuntary manslaughter offense is a crime involving moral turpitude, the Fourth Circuit used the categorical approach outlined in Prudencio v. Holder, 669 F.3d 472, 484 (4th Cir. 2012): The court looks at the elements of the crime at issue and determines whether those elements solely encompass behavior that involves moral turpitude. If they do, the crime is categorically one involving moral turpitude. But if those elements can include behavior that does not involve moral turpitude, the crime is not categorically one involving moral turpitude.

The Fourth Circuit started by discussing the definition of "moral turpitude." Citing the BIA decision In re Perez-Contreras, 20 I. & N. Dec. 615, 618 (BIA 1992), the Fourth Circuit found that moral turpitude is present "[w]here knowing or intentional conduct is an element of an offense." Those circumstances include criminally reckless conduct, which "reflect[s] a willingness to disregard the risks inherent in the conduct." Criminally negligent conduct, however, is not included because "there [is] no intent required for conviction, nor any conscious disregard of a substantial and unjustifiable risk."

In analyzing the elements of Virginia's involuntary manslaughter offense, the Fourth Circuit found that the offense requires that "the offender either knew or should have known the probable results of his acts." See Conrad v. Commonwealth, 521 S.E.2d 321, 326 (Va. Ct. App. 1999 (en banc)). Thus, the court held that an involuntary manslaughter conviction can be secured in Virginia upon a showing of criminal negligence, without proving a conscious disregard of risks attendant to the offender's conduct. Therefore, the Fourth Circuit concluded that Virginia's involuntary manslaughter offense is not categorically a crime involving moral turpitude.

In response to the IJ's reliance on the In re Franklin decision, the Fourth Circuit held that decision did not control the outcome of this case because the definition of involuntary manslaughter in Virginia is "materially distinguishable" from the definition of involuntary manslaughter in Missouri. The court noted that while Missouri's involuntary manslaughter requires a "conscious disregard of a substantial and unjustifiable risk," Virginia's involuntary manslaughter does not.

To read the full opinion, click here.

Panel: Judges Niemeyer, King, and Agee

Argument Date: 12/08/2016

Date of Issued Opinion: 01/24/2017

Docket Number: No. 15-2073

Decided: Petition for review granted; vacated and remanded by published opinion

Case Alert Author: Ziyi He, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Jason Matthew Zarrow, O'MELVENY & MYERS LLP, Washington, D.C., for Petitioner. Keith Ian McManus, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Respondent. ON BRIEF: Mary Patrice Brown, O'MELVENY & MYERS LLP, Washington, D.C., for Petitioner. Benjamin C. Mizer, Principal Deputy Assistant Attorney General, Cindy S. Ferrier, Assistant Director, Office of Immigration Litigation, Civil Division, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Respondent.

Author of Opinion: Circuit Judge King

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 02/23/2017 03:23 PM     4th Circuit     Comments (0)  

  Patterson v. Commissioner of Social Security Administration -- Fourth Circuit
'Show Your Work' - Fourth Circuit Remands SSA Claim for ALJ's Failure to Employ Special Technique in Evaluating Claimant's Mental Impairment

Area of Law: Administrative Law

Issue Presented: Whether an Administrative Law Judge's failure to follow the special technique required by 20 C.F.R. § 404.1520a when evaluating a claimant's mental impairment requires remand or may constitute harmless error.

Brief Summary: On an issue of first impression, the United States Court of Appeals for the Fourth Circuit held that an Administrative Law Judge's failure to follow the special procedures outlined in 20 C.F.R. § 404.1520a does not automatically require remand, but that the error was not harmless on the facts of the present case. Accordingly, the Fourth Circuit reversed the district court's order with instructions to remand to the Administrative Law Judge for appropriate review of claimant's impairment.

Extended Summary: In 2010, the Social Security Administration ("SSA") denied Constance L. Patterson's ("Patterson") application for disability insurance benefits. Patterson filed a request for a hearing, after which an Administrative Law Judge ("ALJ") affirmed the SSA's decision. The ALJ found Patterson was not disabled during the period for which she sought benefits based primarily on the conclusions of one doctor. Patterson sought review of the ALJ's decision on the grounds that the ALJ (1) failed to follow the special technique outlined in 20 C.F.R. § 404.1520a and (2) reached a decision without considering other medical evidence. The SSA's Appeals Council denied relief and Patterson subsequently filed suit in federal district court. The magistrate recommended affirming the SSA, on the grounds that (1) substantial evidence supported all of the ALJ's challenged findings and (2) the ALJ's failure to articulate his findings in accordance with the special technique regulation constituted harmless error. The district court adopted the magistrate's recommendation and affirmed the SSA's decision.

On appeal, Patterson sought to remand the case to the SSA for proceedings consistent with the regulations. Counsel for the SSA conceded the ALJ failed to apply the special technique regulation, but argued remand was unnecessary because the Fourth Circuit could conduct the analysis itself in determining whether substantial evidence supported the ALJ's denial of benefits. The court disagreed. The court found the ALJ's failure to use the special-technique regulation frustrated effective judicial review. In deciding this issue of first impression, the Fourth Circuit noted a split among its sister circuits on whether harmless error review applies. The court disagreed with the Sixth Circuit's holding in Rabbers v. Comm'r Soc. Sec. Admin., 582 F.3d 647 (6th Cir. 2009), that the special technique regulation offers only non-binding guidance for the benefit of the ALJ. The court reasoned that the plain language of the regulation describes what the SSA must do and the fact that the SSA chose to codify the procedure in a regulation prevents a conclusion that the special technique process was simply for the benefit of ALJs. Further, the court reasoned, an ALJ's failure to properly document application of the special technique would rarely be harmless because such a failure prevents judicial review.

The court noted that although the failure to follow the special technique regulation may not always require remand, the error did require remand in this case because the ALJ did not explain how he weighed all relevant evidence, nor did he explain how he reached his conclusions about the severity of the mental impairment as required by the regulation. The court did not take a position on the merits of Patterson's application for disability benefits because reviewing the ALJ's mental impairment evaluation was beyond the scope of its review. Ultimately, the Fourth Circuit reversed the district court's order with instructions to remand to the SSA for proceedings consistent with its own regulations in the interest of judicial efficiency.

To read the full opinion, click here.

Panel: King, Duncan, and Keenan, Circuit Judges

Argument Date: 12/07/2016

Date of Issued Opinion: 01/19/2017

Docket Number: No. 15-2487

Decided: Reversed and remanded with instructions by published opinion.

Case Alert Author: Yvette Pappoe, Univ. of Maryland Carey School of Law

Counsel: ARGUED: William Daniel Mayes, SMITH, MASSEY, BRODIE, GUYNN & MAYES, P.A., Aiken, South Carolina, for Appellant. Evelyn Rose Marie Protano, SOCIAL SECURITY ADMINISTRATION, Philadelphia, Pennsylvania, for Appellee. ON BRIEF: Nora Koch, Acting Regional Chief Counsel, Charles J. Kawas, Acting Supervisory Attorney, Office of the General Counsel, SOCIAL SECURITY ADMINISTRATION, Philadelphia, Pennsylvania; William N. Nettles, United States Attorney, Marshall Prince, Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Columbia, South Carolina, for Appellee.

Author of Opinion: Judge Duncan

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 02/23/2017 10:47 AM     4th Circuit     Comments (0)  

February 22, 2017
  United States v. Robinson -- Fourth Circuit
Gun Owners, Beware: Armed = Dangerous

Areas of Law: Fourth Amendment, Second Amendment

Issue Presented: Whether a law enforcement officer is justified in frisking a person whom the officer has lawfully stopped and whom the officer reasonable believes to be equipped with a firearm, if state law allows persons to carry concealed firearms with a permit.

Brief Summary: The United States Court of Appeals for the Fourth Circuit affirmed the district court's denial of the defendant's motion to suppress a firearm uncovered during a frisk, because the frisk was justified. Citing Terry v. Ohio, 392 U.S. 1 (1968), and Pennsylvania v. Mimms, 434 U.S. 106 (1997), the Fourth Circuit held that when an officer reasonably suspects the person he has stopped is armed, the officer is "warranted in the belief that his safety . . . [is] in danger," thus justifying a Terry frisk. Accordingly, the Fourth Circuit concluded that because the officers made a lawful traffic stop and had reasonable suspicion to believe that the defendant was armed, the frisk was lawful.

Extended Summary: On the afternoon of March 24, 2014, the West Virginia Police Department received an anonymous tip. The tipster stated that a black male in the parking lot of a 7-Eleven had just loaded a firearm, concealed it in his pocket, and climbed into a blue-green Toyota Camry being driven by a white woman. Knowing that the parking lot was frequently used as a site for drug trafficking, Officer Hudson and Captain Roberts immediately responded. After observing a blue-green Toyota Camry driven by a white woman with a black male passenger who were not wearing seatbelts, Officer Hudson effected a traffic stop. Officer Hudson asked the driver for her license, registration, and proof of insurance. He also asked the passenger, the appellant, Shaquille Robinson, for his identification and to step out of the car.

As Robinson was exiting the vehicle, Captain Roberts asked Robinson if he had any weapons on him. Robinson "gave [Roberts] a weird look." Captain Roberts took the look to mean, "I don't want to lie to you, but I'm not going to tell you anything [either]." At that point, Captain Roberts directed Robinson to put his hands on the car and performed a frisk for weapons, recovering a loaded gun from Robinson's pocket.

Robinson was charged with illegal possession of a firearm by a felon. In the district court, he filed a motion to suppress the firearm, arguing that the frisk violated his Fourth Amendment rights. As explained in Terry v. Ohio, 392 U.S. 1 (1968), an officer can frisk a validly stopped person if the officer reasonably suspects the person is "armed and dangerous."

Robinson argued that the officers did not have reasonable suspicion to believe he was dangerous for two reasons. First, at the time of the frisk, West Virginia residents could lawfully carry a concealed firearm if they had a license. Because the police did not know whether Robinson possessed such a license, the tip that a suspect matching his description was carrying a loaded firearm concealed in his pocket was a report of innocent behavior that was not sufficient to indicate that he posed a danger to others. Second, Robinson argued that his behavior during the stop - being compliant, cooperative, and not displaying signs of nervousness - did not create suspicion.

The district court denied Robinson's motion to suppress. The district court explained that the "anonymous tip that [Robinson] [had] recently loaded a firearm and concealed it on his person in a public parking lot in a high-crime area," as well as Robinson's "weird look and failure to verbally respond to the inquiry whether he was armed," gave rise to the officers' reasonable suspicion that Robinson was armed and dangerous.

Robinson appealed the denial of his motion to suppress, and a panel of the Fourth Circuit reversed the district court's decision and vacated Robinson's conviction. The government then filed a petition for rehearing en banc. The full court vacated the panel's judgment and opinion.

Relying on Terry v. Ohio and Pennsylvania v. Mimms, the Fourth Circuit held that when an officer reasonably suspects the person he has stopped is armed, the officer is "warranted in the belief that his safety . . . [is] in danger," thus justifying a Terry frisk. The Fourth Circuit first acknowledged the Supreme Court's statement in Terry discussing the legality of the frisk: "there is the more immediate interest of the police officer in taking steps to assure himself that the person with whom he is dealing is not armed with a weapon that could unexpectedly and fatally be used against him." "[T]he danger," the Fourth Circuit concluded, "was thus found in the presence of a weapon during a forced police encounter."

Second, the Fourth Circuit acknowledged similar language in both Terry and Mimms regarding the relationship between "armed" and "dangerous." In Terry, in approving an officer's frisk of Terry, the Supreme Court stated that "a reasonably prudent man would have been warranted in believing petitioner was armed and thus presented a threat to the officer's safety." In Mimms, the Supreme Court found the frisk there was justified because the bulge in Mimms' jacket "permitted the officer to conclude that Mimms was armed and thus posed a serious and present danger to the safety of the officer." The Fourth Circuit concluded that in both Terry and Mimms, the Supreme Court deliberately linked "armed" and "dangerous," recognizing that the risk of danger is created simply because the person, who was forcibly stopped, is armed. Accordingly, the Fourth Circuit held that, in the present case, because the officers made a lawful traffic stop and had reasonable suspicion to believe that Robinson was armed, the frisk was lawful.

Robinson also argued that Mimms was distinguishable because the frisk there took place in a jurisdiction that made it a crime to carry a concealed deadly weapon, while West Virginia permitted its citizens to carry firearms. Robinson argued that when the person forcibly stopped might be legally permitted to possess a firearm, the risk of danger posed by the firearm is eliminated. The Fourth Circuit rejected this argument as well. Citing Adams v. Williams, 407 U.S. 143, 146 (1972), the Fourth Circuit held that the legality of the frisk does not depend on the illegality of the firearm's possession.

Finally, in dicta, the Fourth Circuit agreed with the district court's findings that the reliable tip that Robinson had recently loaded a firearm and concealed it in his pocket in a public parking lot in a high-crime area, as well as Robinson's failure to verbally respond to the inquiry whether he was armed, gave rise to a reasonable suspicion that Robinson was armed and dangerous. As a result, the Fourth Circuit affirmed the district court's decision.

Judge Harris (together with Chief Judge Gregory, Circuit Judge Motz, and Senior Judge Davis) disagreed with the majority's interpretation of "armed and dangerous." Judge Harris acknowledged that for many years, carrying firearms in public was prohibited or closely regulated, and a concealed gun was indicative of criminal activity and might give rise to "reasonable suspicion" sufficient to justify an investigative stop. However, Judge Harris emphasized, "that is no longer the case, at least in states like West Virginia."

Judge Harris observed that within the last decade, federal constitutional law has recognized new Second Amendment protections for individual possession of firearms, see McDonald v. City of Chicago, 561 U.S. 742, 791 (2010); District of Columbia v. Heller, 554 U.S. 570, 635 (2008); and state law has followed, providing expanded rights to carry guns in public, see United States v. Williams, 731 F.3d 678, 691 (7th Cir. 2013). Citing United States v. Black, 707 F.3d 531, 539-40 (4th Cir. 2013), Judge Harris noted that the Fourth Circuit had held that when a state elects to legalize the public carrying of firearms, the Fourth Amendment equation changes, and public possession of a gun is no longer "suspicious" in a way that would authorize a Terry stop. This view, Judge Harris found, had been supported by the Third, Sixth, and Seventh Circuits.

Therefore, Judge Harris concluded that in a state like West Virginia, which broadly allows public possession of firearms, reasonable suspicion that a person is armed does not by itself give rise to reasonable suspicion that the person also is dangerous, so as to justify a Terry frisk. Additionally, none of the conduct reported in the anonymous tip was illegal under West Virginia law, or unusual where it occurred.

Judge Harris refused to "endorse a rule that puts us on a collision course with rights to gun possession rooted in the Second Amendment and conferred by state legislatures. Nor would [she] adopt a rule that leaves to unbridled police discretion the decision as to which legally armed citizens will be targeted for frisks, opening the door to the very abuses the Fourth Amendment is designed to prevent."

To read the full opinion, click here.

Panel: Chief Judge Gregory, Judges Wilkinson, Niemeyer, Motz, Traxler, King, Shedd, Duncan, Agee, Keenan, Wynn, Diaz, Floyd, Thacker, and Harris, and Senior Judge Davis

Argument Date: 09/22/2016

Date of Issued Opinion: 01/23/2017

Docket Number: No. 14-4902

Decided:
Affirmed by published opinion.

Case Alert Author: Maria Nazarova, Univ. of Maryland Carey School of Law

Counsel: Nicholas Joseph Compton, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Martinsburg, West Virginia, for Appellant. Thomas Ernest Booth, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee. ON BRIEF: Kristen M. Leddy, Research and Writing Specialist, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Martinsburg, West Virginia, for Appellant. William J. Ihlenfeld, II, United States Attorney, Jarod J. Douglas, Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Wheeling, West Virginia, for Appellee.

Author of Opinion: Judge Niemeyer

Dissenting Opinion:
Judge Harris

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 02/22/2017 12:52 PM     4th Circuit     Comments (0)  

February 21, 2017
  United States v. Moreno-Tapia -- Fourth Circuit
Since-Vacated Convictions Cannot Undo Conviction or Sentencing Enhancement for Illegal Reentry

Areas of Law: Immigration Law, Criminal Law, Sentencing Guidelines

Issue Presented: Whether an undocumented person can collaterally attack an illegal reentry charge on the ground that his original deportation proceedings was predicated on since-vacated convictions. Whether the District Court wrongly considered since-vacated convictions when determining a defendant's sentencing range under the "crime of violence" provision in the Sentencing Guidelines.

Brief Summary: In a published opinion, the United States Court of Appeals for the Fourth Circuit affirmed the District Court's judgment denying the defendant's motion to vacate his prior removal order and to withdraw his guilty plea to the charge of illegal reentry. Moreover, the Fourth Circuit found no error in the District Court's reliance on the defendant's vacated state convictions in determining his sentencing range under the Sentencing Guidelines.

Extended Summary: This case arose from the illegal reentry of a Mexican native. As a child, defendant-appellant Juan Antonio Moreno-Tapia ("Moreno-Tapia") immigrated to the United States from Mexico with his family. Although his parents and five siblings became legal permanent residents, Moreno-Tapia was unable to obtain legal permanent residency.

In 2006, Moreno-Tapia pled guilty to three charges of indecent liberties with a child, arising from a consensual relationship with a fifteen-year-old girl when he was twenty-one years old. The state court sentenced Moreno-Tapia to a sentence of fifteen to eighteen months' imprisonment and ordered him to register as a sex offender upon release. Neither the state court nor his attorney informed Moreno-Tapia of the immigration consequences associated with his guilty plea. Thereafter, the Department of Homeland Security ("DHS") initiated expedited removal proceedings against Moreno-Tapia. He was deported in 2009.

At some point prior to 2011, Moreno-Tapia reentered the United States without permission and was subsequently arrested. In 2014, Moreno-Tapia was charged with illegal reentry by a removed alien and with failure to register as a sex offender. Moreno-Tapia pled guilty to illegal reentry, and the District Court dismissed the charge for failure to register.

In 2015, Moreno-Tapia moved to vacate his 2006 convictions in state court. Specifically, Moreno-Tapia argued that his lawyer's failure to disclose his plea's immigration consequences rendered his 2006 convictions unconstitutional under the Supreme Court's decision in Padilla v. Kentucky, 559 U.S. 356 (2010). The state court agreed and vacated Moreno-Tapia's 2006 convictions. Moreno-Tapia then returned to the District Court, moving to (1) vacate his 2009 removal order and withdraw his 2014 guilty plea for illegal reentry and (2) dismiss both counts of his 2014 indictment. The District Court denied both motions. On appeal, Moreno-Tapia challenged his federal charges and the enhancement of his sentence due to his since-vacated convictions.

To establish illegal reentry, the government must prove the defendant's prior removal, which generally requires a DHS removal order. The defendant, however, may bring a collateral attack against a removal order by demonstrating the following: (1) the defendant exhausted available administrative remedies; (2) the deportation proceedings improperly deprived the defendant of the opportunity for judicial review; and (3) the order's entry was fundamentally unfair. Moreno-Tapia argued that his immigration proceedings were fundamentally unfair, because they were grounded on unconstitutional, since-vacated convictions.

The Fourth Circuit affirmed the District Court's judgment. The Fourth Circuit declined to decide whether due process permits a collateral attack against an immigration order based on the constitutionality of an underlying conviction. Instead, the Fourth Circuit concluded that Moreno-Tapia's state convictions were in fact constitutional despite being vacated. Because the Supreme Court's 2010 decision in Padilla does not apply retroactively, the failure to warn Moreno-Tapia of his plea's immigration consequences did not render his 2006 convictions unconstitutional.

Turning to his sentence, Moreno-Tapia argued that the District Court improperly considered his since-vacated convictions when calculating his Sentencing Guidelines range. Rejecting this argument, the Fourth Circuit asserted that the relevant time for determining whether a prior conviction triggers enhancement under the "crime of violence" provision is the date of deportation, rather than the date of the subsequent illegal reentry charge or sentencing hearing. The Fourth Circuit articulated two reasons for its conclusion. First, the enhancement provision is written in the past tense, applying only if a defendant "previously was deported . . . after[] a conviction." Second, the enhancement provision did not expressly exclude since-vacated convictions from consideration. The Fourth Circuit further declined to find an exception for unconstitutional convictions, emphasizing again that Moreno-Tapia's state convictions were in fact constitutional.

To read the full opinion, click here.

Panel: Judges Harris, Traxler, and Diaz

Argument Date: 10/28/2016

Date of Issued Opinion: 01/26/2017

Docket Numbers: No. 15-4610

Decided: Affirmed by published opinion

Case Alert Author: Linda Morris, Univ. of Maryland Carey School of Law

Counsel:
John Arthur Duberstein, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Greensboro, North Carolina, for Appellant. Anand P. Ramaswamy, OFFICE OF THE UNITED STATES ATTORNEY, Greensboro, North Carolina, for Appellee. ON BRIEF: Louis C. Allen, Federal Public Defender, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Greensboro, North Carolina, for Appellant. Ripley Rand, United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Greensboro, North Carolina, for Appellee.

Author of Opinion: Judge Harris

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 02/21/2017 04:39 PM     4th Circuit     Comments (0)  

  United States v. Schmidt -- Fourth Circuit
Americans Abroad: No Transfer of Citizenship? No Property Abroad? You Are Still a "Traveler in Foreign Commerce" under U.S. Jurisdiction

Areas of Law: Criminal Law, Habeas Corpus

Issue Presented: Whether the defendant's "travel in foreign commerce" for purposes of 18 U.S.C. § 2423(c) ended after he departed the United States for the Philippines, got a work permit, had a full-time job, rented a home, used a local driver's license, and stayed in the Philippines for eighteen months.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that the defendant was travelling in foreign commerce from the time he departed the United States until the time of his illicit sexual conduct in Cambodia. Citing United States v. Jackson, 480 F.3d 1014 (9th Cir. 2007) and United States v. Bollinger, 798 F. 3d 201 (4th Cir. 2015), the Fourth Circuit construed "travel in foreign commerce," under 18 U.S.C. § 2423(c), as any movement abroad that maintains some nexus with the United States. Where Richard Schmidt kept a substantial amount of money in a United States bank account, never purchased any property abroad, and never made an effort to obtain permanent legal status in another country, the Fourth Circuit found that he was merely a visitor in the Philippines and Cambodia. Therefore, the Fourth Circuit reversed the district court's grant of the defendant's habeas corpus petition.

Extended Summary: Richard Schmidt ("Schmidt") is a sexual predator who has been repeatedly convicted of sex offenses involving young boys. In June 2002, to avoid arrest for allegedly making unauthorized contact with a minor in violation of his parole, Schmidt fled the United States for the Philippines. In the Philippines, Schmidt worked as a school instructor until he was arrested by Philippine authorities on charges of once again sexually molesting young boys. In December 2003, during a period of pre-trial release, Schmidt fled to Cambodia. His pattern of sex misconduct continued there and he was arrested by Cambodian authorities. Schmidt was subsequently deported to the United States to face numerous criminal charges, including a violation of 18 U.S.C. § 2423(c) ("§ 2423(c)") for illicit sexual conduct in Cambodia. Schmidt pled unconditionally guilty to this charge and was sentenced to a prison term of fifteen years and a lifetime of supervised release.

Schmidt filed a petition for a writ of habeas corpus under 28 U.S.C. § 2254 in the United States District Court for the District of Maryland. He argued that he was innocent of violating § 2423(c) and that his counsel was ineffective for failing to notice this defect at the time he entered his plea.

Section 2423(c) provides that "[a]ny United States citizen or alien admitted for permanent residence who travels in foreign commerce, and engages in any illicit sexual conduct with another person shall be fined under this title or imprisoned not more than 30 years, or both."

Schmidt contended that his travel in foreign commerce ended during his stay in the Philippines, long before his illicit sexual conduct in Cambodia. He further claimed that any subsequent travel, such as his flight to Cambodia, was not independent travel in foreign commerce for purposes of § 2423(c). The district court agreed.

The Fourth Circuit disagreed, holding that Schmidt was "traveling in foreign commerce" from the time he departed the United States until the time of his illicit sexual conduct in Cambodia. The Fourth Circuit started its analysis by interpreting the term "travel in foreign commerce." First, the Fourth Circuit held that the term "travel" did not simply encompass movement from one place to another, but instead denoted a broader concept of movement abroad. Citing the Ninth Circuit's decision in United States v. Jackson, 480 F.3d 1014 (9th Cir. 2007), the Fourth Circuit found that a person might still be traveling even after a significant amount of time in a given location so long as the visit was sufficiently transient or contemplated eventual departure. Thus, the Fourth Circuit concluded that travel could continue until a party either returned to his or her place of origin or permanently resettled elsewhere. Second, citing United States v. Bollinger, 798 F. 3d 201 (4th Cir. 2015), the Fourth Circuit held that "foreign commerce" required some nexus with the United States. Therefore, the Fourth Circuit construed "travel in foreign commerce" as "movement abroad that maintain[ed] some nexus with the United States."

Schmidt first argued that his travel in foreign commerce ended shortly after he arrived in the Philippines because he got a work permit, had a full-time job, rented a home, used a local driver's license, and remained in the Philippines for eighteen months. The Fourth Circuit disagreed, holding that Schmidt's status remained transient in the Philippines and Cambodia. The Fourth Circuit observed that Schmidt stayed in the Philippines on tourist visas and worked using an "alien employment permit" for "non-resident foreign nationals." Further, the Fourth Circuit found that Schmidt maintained a substantial amount of money in a United States' bank account, and never purchased a home or other property abroad. Specifically, the Fourth Circuit noted that Schmidt continually traveled on a United States passport and made no effort to obtain permanent status in another country. Therefore, the Fourth Circuit concluded that he was "just a visitor in the Philippines and Cambodia."

Schmidt also argued that his travel in foreign commerce ended shortly after he arrived in the Philippines because he had no intention of returning to the United States. The Fourth Circuit, however, observed that the element of travel and requisite nexus with the United States was an objective inquiry that did not turn solely on self-serving and subjective allegations of intent. Even though intent to permanently resettle might be one factor in determining when relevant travel in foreign commerce comes to an end, the Fourth Circuit found that it was not dispositive.

Finally, the Fourth Circuit compared Schmidt's case with United States v. Jackson. In United States v. Jackson, the Ninth Circuit concluded that the defendant's travel in foreign commerce ended after he moved to Cambodia, purchased a home, and commenced the five-year residency requirement for Cambodian citizenship. The defendant and his partner also sold their home and remaining property in the United States, transferring all their assets to Cambodia. The Fourth Circuit found that Schmidt's stay displayed none of these features. Therefore, the Fourth Circuit reversed the district court's decision and remanded for reinstatement of the judgment of conviction.

To read the full opinion, click here.

Panel: Judges Wilkinson, Agee, and Harris

Argument Date: 12/06/2016

Date of Issued Opinion: 01/04/2017

Docket Number: No. 16-6567

Decided: Reversed by published opinion

Case Alert Author: Ziyi He, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Sujit Raman, OFFICE OF THE UNITED STATES ATTORNEY, Greenbelt, Maryland, for Appellant. Mary Elizabeth Davis, DAVIS & DAVIS, Washington, D.C., for Appellee. ON BRIEF: Rod J. Rosenstein, United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Baltimore, Maryland, for Appellant.

Author of Opinion: Judge Wilkinson

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 02/21/2017 10:49 AM     4th Circuit     Comments (0)  

February 16, 2017
  United States v. Barret
Headline: Second Circuit Rules That Testimony of a Former Co-Defendant Who Pleads Guilty During Trial is Admissible During the Same Trial, With Appropriate Precautions

Area of Law: Criminal

Issue Presented: Whether the testimony of a former co-defendant who switches his plea to guilty and agrees midtrial to testify against the remaining co-defendants is admissible, provided that steps are taken to avoid undue prejudice to the remaining defendants.

Brief Summary:
This case developed from a joint investigation by the United States Postal 5 Inspection Service, the Drug Enforcement Administration ("DEA"), and the New York City and New York State Police Departments, into the activities of a large-scale marijuana distribution organization in Queens, New York known as the "Fatherless Crew." The Fatherless Crew is alleged to have run its operation out of the Barret residence in Jamaica, Queens, one other residential property, and several commercial mail receiving agencies ("CMRAs") located in Queens. The first four days of trial consisted primarily of testimony by the case agent, after which one defendant entered into proffer talks with the government. He then entered into a cooperation agreement with the government and changed his plea from innocent to guilty on January 17, 2012. That same day, the government advised the court and defense counsel of its intention to add the now-cooperating defendant to its witness list. The remaining co-defendants were convicted in the United States District Court for the Eastern District of New York, and they appealed. The Second Circuit joined the Third and Seventh Circuits in holding that a district court may allow such testimony, provided that it takes appropriate steps to avoid causing unfair prejudice to the remaining co‐defendants. To read the full opinion, please visit http://www.ca2.uscourts.gov/de...abfc524b541/2/hilite/

Significance, if Any: Issue of first impression in the Second Circuit.

Extended Summary: On October 5, 2010, ten packages weighing roughly 120 kilograms were sent from Arizona to three CMRAs in Flushing. Investigators observed Wilson pick up nine of the boxes and deliver them to the Barret residence. Investigators later discovered the tenth box at another CMRA in Flushing, and seized 10.63 kilograms of marijuana from the box. In addition, on August 19, September 2, and 23, 2010, investigators conducted "trash pulls" of garbage left outside the Barretr residence and discovered bags containing remnants of marijuana, bags with marijuana residue and rubber bands.

Following Barret's arrest, a New York Police Department SWAT team executed a search warrant at the Barret residence. The police also arrested Scarlett, Forrest and several others. During their search of the residence, investigators discovered an open box, along with one bale of marijuana on the kitchen counter and another bale on the floor. Investigators also opened the remaining unopened parcels and found more 13 bales of marijuana. The total weight of the marijuana recovered from the packages exceeded 95.7 kilograms. Investigators recovered approximately 20.4 kilograms more of marijuana elsewhere in Barret's house.

The first four days of trial in the United States District Court for the Eastern District of New York consisted primarily of testimony by the case agent, after which Forrest entered into proffer talks with the government. He entered into a cooperation agreement with the government and changed his plea from innocent to guilty on January 17, 2012. That same day, the government advised the court and defense counsel of its intention to add Forrest to its witness list.

Scarlett, Mitchell, and co-defendant Ryan Anderson objected and moved to exclude Forrest's testimony, arguing: (1) Forrest participated in defense strategy before entering into his cooperation agreement, enabling him to report on such strategies to the government in violation of the co-defendants' Sixth Amendment rights to counsel; (2) Forrest was present at trial for the testimony of the government's first witness, violating Rule 615 of the Federal Rules of Evidence which requires the exclusion of witnesses from the courtroom; and (3) Forrest's testimony would likely refute assertions made during the defense's opening and arguments that were critical to the defense. Nonetheless, the testimony was admitted and the defendants were ultimately convicted.

On appeal, the Second Circuit noted that "the question of whether a district court may permit the testimony of co-defendants who change their pleas to guilty mid-trial and testify for the government is a question of first impression in our Circuit." The court ruled: "We join our sister Circuits in holding that a district court may allow such testimony, but must take appropriate steps to avoid causing unfair prejudice to the remaining co-defendants.

The court then explained what those "appropriate steps" involve. First, the district court must ensure that the testimony of the former co-defendant is admitted "only for the limited purpose of testifying to events other than the witness's involvement in joint defense planning," so that no testimony is given about the defense strategy. Second, the district court must "deliver adequate cautionary instructions to the jury to make certain that the jury does not draw any adverse or unfair inferences against the remaining co-defendants, does not use the former co-defendant's admission as guilt as evidence of the guilt of the remaining co-defendants, and does not give the former co-defendant's testimony undue weight." Here, the court approved of the jury instructions that the district court had given, and affirmed the conviction.
To read the full opinion, please visit: http://www.ca2.uscourts.gov/de...efc17f8cf2d/1/hilite/

Panel (if known): Circuit Judges Pooler, Hall, and Carney

Argument Date: 1/6/16

Date of Issued Opinion: 2/15/17

Docket Number: Nos. 12‐4663(L), 13‐3800, 14‐573, 14‐2014

Decided: Affirmed

Case Alert Author: Belino Voshtina

Counsel: James M. Branden, New York, NY, for Defendant-Appellant Christopher Barret. Michael H. Sporn, New York, NY, for Defendant‐Appellant Omar Mitchell. Peter Tomao, Garden City, NY, for Defendant‐Appellant Leon Scarlett. Tyler J. Smith, Assistant United States Attorney (Amy Busa, Peter A. Norling, Assistant United States Attorneys, on the brief), for Robert L. Capers, United States Attorney for the Eastern District of New York, New York, NY, for Appellee.

Author of Opinion: Judge Pooler

Circuit: Second Circuit

Case Alert Circuit Supervisor: Professor Emily Gold Waldman

    Posted By: Emily Waldman @ 02/16/2017 04:46 PM     2nd Circuit     Comments (0)  

February 15, 2017
  Brown Jordan International, Inc., v. Carmicle - 11th Circuit
Headline: Eleventh Circuit holds an interruption of service is not required to be compensated under the Computer Fraud and Abuse Act ("CFAA").

Area of Law: Civil, Commerce, Employment

Issue: Whether interruption of service is required to be compensated under the CFAA.

Extended Summary: On March 11, 2014, Appellee, Brown Jordan International, Inc. ("Brown Jordan"), initiated a suit against Appellant, Christopher Carmicle ("Carmicle"), including claims for violation of the CFAA and of the Stored Communications Act ("SCA"). After a bench trial, the district court concluded Carmicle's access to the email accounts violated the CFAA and SCA. On appeal, Carmicle contended the district court erred in finding a violation of the CFAA because there was no interruption of service, and thus no "loss." In a case of first impression, the Eleventh Circuit found a "loss" included the direct costs of responding to a CFAA violation, without it being related to an interruption of service. Accordingly, the Eleventh Circuit affirmed the lower court's determination on the CFAA violation. The court also rejected the other contentions raised by Carmicle.

To view the full opinion: http://media.ca11.uscourts.gov...ub/files/201611350.pdf

Panel: Marcus and Black, Circuit Judges, and Cohen (United States District Judge for the Northern District of Georgia, sitting by designation).

Argument: November 18, 2016

Date of Issued Opinion: January 25, 2017

Docket Number: 16-11350

Decided: Affirmed

Case Alert Authors: Luis Garcia, Shantell Monreal, and Uxsunn Ramirez

Counsel:
Glenn Alan Cohen for Appellant
Lloyd B. Chinn for Appellees

Author of Opinion: Black, Circuit Judge

    Posted By: Gary Kravitz @ 02/15/2017 03:46 PM     11th Circuit     Comments (0)  

  Dukes v. Deaton - 11th Circuit
Headline: Eleventh Circuit holds officers who used a "flashbang" without visually inspecting a room violated the Fourth Amendment, but were entitled to qualified immunity.

Area of Law: Criminal, Constitutional law

Issue: Whether officers who used a "flashbang" without visually inspecting a room, in violation of the Fourth Amendment, are entitled to qualified immunity.

Extended Summary: On July 21, 2010, law enforcement officers executed a search warrant on an apartment connected with the sale of narcotics. Prior to entering the apartment, one of the officers used a "flashbang" to disorient the occupants, which included Appellant, Treneshia Dukes ("Dukes"). Dukes filed a complaint for various claims, including violation of her right to be free from excessive force under the Fourth Amendment. The district court entered summary judgment in favor of the officers based on qualified immunity. On appeal, the Eleventh Circuit noted the decisions of other circuit courts, which found the use of a "flashbang" in similar circumstances, constituted excessive force in violation of the Fourth Amendment. While the Eleventh Circuit agreed with that determination, the court held qualified immunity applied because the use of excessive force was not "clearly established" as a statutory or constitutional violation at the time the search warrant in this case was executed. Accordingly, the summary judgment was affirmed.

To view the full opinion: http://media.ca11.uscourts.gov...b/files/201514373.pdf

Panel: William Pryor and Rosenbaum, Circuit Judges, and Ungaro (United States District Judge for the Southern District of Florida, sitting by designation)

Argument: December 14, 2016

Date of Issued Opinion: January 26, 2017

Docket Number: 15-14373

Decided: Affirmed

Case Alert Authors: Luis Garcia, Shantell Monreal, and Uxsunn Ramirez

Counsel:
Mario Bernard Williams for Appellant Treneshia Dukes
Wayne Steven Melnick for Appellees Nicholas Deaton and Steve Branham.

Author of Opinion: William Pryor, Circuit Judge

    Posted By: Gary Kravitz @ 02/15/2017 03:39 PM     11th Circuit     Comments (0)  

February 14, 2017
  Craig Williams and Shaun T. Walker v. Sec. Pa. Dept. of Corrections - Third Circuit
Headline: Third Circuit provides fair and clear warning that "those no longer subject to the death penalty have a due process right to be free from indefinite conditions of solitary confinement"; qualified immunity will not bar future claims

Area of Law: Due Process, Qualified immunity

Issues Presented: Whether there is a constitutionally protected liberty interest that prohibits the State from continuing to house inmates in solitary confinement on death row after they have been granted resentencing hearings, without meaningful review of the continuing placement?

Brief Summary:
Plaintiffs sued various Department of Corrections officials, alleging the officials violated their Fourteenth Amendment rights to due process by continuing to subject them to the deprivations of solitary confinement on death row without meaningful review of their placements for years after their death sentences had been vacated. Plaintiffs' appeals from summary judgment rulings for the defendants were consolidated.

On appeal, the Third Circuit established that there is a constitutionally protected liberty interest that prohibits the State from continuing to house inmates in solitary confinement on death row after they have been granted resentencing hearings, without meaningful review of the continuing placement. The Due Process Clause of the Fourteenth Amendment limits the State's ability to subject an inmate to the deprivations of death row once the death sentence, initially relied upon to justify such extreme restrictions, is no longer operative. However, because this principle was not clearly established, the defendants were entitled to qualified immunity.

Extended Summary: Craig Williams and Shawn T. Walker ("Plaintiffs") are inmates in the custody of the Pennsylvania Dept of Corrections ("DOC"). Each was sentenced to death and housed on the death row of his respective institution. Eventually, their death sentences were vacated, but several years elapsed before they were resentenced to life without parole and placed in the general population. In the interim, Plaintiffs were kept on death row in solitary confinement, without regular placement reviews to determine if the deprivations of those placements were necessary.

Each Plaintiff brought suit, seeking damages from various DOC officials ("Defendants"). Their suits alleged the officials violated their Fourteenth Amendment rights to due process by continuing to subject them to the deprivations of solitary confinement on death row without meaningful review of their placements after their death sentences had been vacated. Defendants argued that DOC policy required Plaintiffs' continued confinement on death row until they were resentenced to life imprisonment. According to Defendants, this policy only permitted removal from death row when a death sentence had actually been modified. They claimed that the grants of resentencing merely put Plaintiffs' sentences on hold because reimposition of the death penalty was possible. In any event, Defendants asserted they were protected from Plaintiffs' suits by qualified immunity.

Defendants' motions for summary judgment were granted for both cases. Plaintiffs' appeals from those rulings were consolidated. The Third Circuit established there is a constitutionally protected liberty interest under the Due Process Clause of the Fourteenth Amendment that prohibits indefinite conditions of solitary confinement but that defendants were entitled to qualified immunity because the right had not yet been clearly established. The Court conducted a two-part inquiry. First, it determined whether a right of the Plaintiffs had been violated; and second, it determined whether that right was clearly established when violated such that it would have been clear to a reasonable person that his conduct was unlawful.

With regards to the first inquiry, the Court held that "virtual isolation for almost eight years" in solitary confinement created a protected liberty interest under the Fourteenth Amendment. The Court explained a liberty interest may arise from the Constitution or "from an expectation or interest created by state laws." To rise to the level of a liberty interest, the right alleged must confer "freedom from restraint which . . . imposes atypical and significant hardship on the inmate in relation to the ordinary incidents of prison life."

Plaintiffs sufficiently alleged atypical hardship for several reasons. Plaintiffs' isolation on death row lasted six and eight years after the initial justification for subjecting them to such extreme deprivation, their death sentences, ceased to exist. Moreover, their isolation contrasted sharply with other common forms of solitary confinement because it was indefinite. Plaintiffs' continued confinement on death row after their death sentences were vacated continued for years with no ascertainable date for their release into the general population. The Court noted researchers have found that even a few days in solitary confinement can cause cognitive disturbances. Thus, the conditions Plaintiffs had to endure while awaiting re-sentencing constituted an "atypical . . . hardship on the inmate in relation to the ordinary incidents of prison life."

The Third Circuit also found Plaintiffs sufficiently alleged significant hardship. It explained in detail that the conditions Plaintiffs experienced on death row "differ[ed] significantly from 'routine' prison conditions in Pennsylvania state institutions." For example, Plaintiffs were confined to their respective cells for twenty-two to twenty-four hours a day and ate all meals accompanied only by the emptiness within the walls of their cells, among other hardships. Additionally, the Court again noted research has shown that such conditions can trigger devastating psychological consequences, and that these hardships are stark departures from conditions in the general prison population.

In opposition to the Court's reasoning, Defendants argued that Plaintiffs' continued confinement on death row could not be atypical since the appropriate standard in this case is not the general prison population. Instead, Defendants claimed the metric that should have been applied was either the conditions imposed on inmates eligible for the death penalty, or what Plaintiffs' convictions have "authorized the State to impose." However, the Court found Defendants' argument failed for several reasons. First, the Court explained that the "similar sentence" standard Defendants proposed was inconsistent with Third Circuit precedent. The Court had previously judged the conditions of solitary confinement "in relation to the ordinary incidents of prison life" or relative to "'routine' prison conditions." Second, the metric Defendants proposed was unworkable in the context of this case. The Court explained it could not resolve Plaintiffs' claims by reference to "inmates serving similar sentences" because, during the period at issue, Plaintiffs were not serving any sentence whatsoever. Their sentences had been vacated and resentencing had been ordered. Defendants' other metric - what the State is authorized to impose - was also based on a similarly mistaken premise.

Finally, the Court pointed out that the cases Defendants relied on in arguing against Plaintiffs' liberty interest were readily distinguishable from the cases at hand. While those cases held that inmates confined under a death sentence did not have a liberty interest that precludes confinement on death row without regular review, those inmates were all confined pursuant to death sentences that had not been vacated. Accordingly, confinement on death row was not a significant or atypical hardship for them. Rather, it was expressly within the "expected perimeters of the sentence imposed." The Court found that their liberty interests were thus unparalleled to those of inmates with active death sentences that arguably require continued placement on death row.

For these reasons, the Court held that Plaintiffs had a due process liberty interest in avoiding the extreme sensory deprivation and isolation endemic in confinement on death row after their death sentences had been vacated.

The Third Circuit next held that, although the precedent that existed when Defendants continued Plaintiffs' confinement on death row should have suggested caution, it was not sufficient to inform Defendants that their conduct violated clearly established law. Instead, Defendants were merely following a prison policy that required appellants to remain on death row until they were resentenced. The Court concluded that Defendants read the policy as creating a rule that required "prisoners like Williams and Walker, whose death sentences have been vacated but who are still exposed to the death penalty, [to] remain [on death row] until resentenced to something other than death." Thus, Defendants' continued confinement of Plaintiffs on death row resulted from a reasonable interpretation of the policy. According to the Court, Defendants' actions were neither "plainly incompetent" nor a "knowing[] violat[ion of] the law." Defendants should have qualified immunity from suit.

In conclusion, the Third Circuit affirmed the district courts' grants of summary judgment based on qualified immunity in favor of all Defendants and against both Plaintiffs. The Court also stressed that despite their ruling against Plaintiffs, its holding-- that Plaintiffs had a protected liberty interest-- provided "fair and clear warning" that qualified immunity will not bar such claims in the future.

The full opinion can be found at http://www2.ca3.uscourts.gov/opinarch/141469p.pdf

Panel: McKee, Fuentes, and Roth, Circuit Judges

Argument Date: April 18, 2016

Date of Issued Opinion: February 9, 2017

Docket Number: No. 14-1469

Decided: Affirmed

Case Alert Author: Brooke A. Hutchins

Counsel: James J. Bilsborrow, Esq., Counsel for Appellants; John G. Knorr III, Kemal A. Mericli, Esq., Randall J. Henzes, Esq., and Claudia M. Tesoro, Esq., Counsel for Appellees

Author of Opinion: Circuit Judge McKee

Circuit: Third Circuit

Case Alert Circuit Supervisor: Prof. Susan L. DeJarnatt

    Posted By: Susan DeJarnatt @ 02/14/2017 01:51 PM     3rd Circuit     Comments (0)  

February 11, 2017
  In re ACTOS End-Payer Antitrust Litigation
Headline: Second Circuit Revives Pharmaceutical Antitrust Suit Over Takeda's Diabetes Drug ACTOS

Areas of Law: Patent; Antitrust

Issue Presented: Whether the plaintiffs adequately alleged that Takeda had harmed them by filing false patent descriptions about its diabetes drug ACTOS

Brief Summary: A group of drug purchaser plaintiffs sued Takeda Pharmaceuticals, alleging that it had falsely described two patents regarding its diabetes drug ACTOS, thereby delaying competitors from selling generic versions of the drug and causing them to pay monopoly prices. The United States District Court for the Southern District of New York dismissed their complaint, finding that the drug purchasers had not plausibly alleged that Takeda's allegedly false descriptions caused other generic competitors to delay their entry into the market. The Second Circuit affirmed in part and vacated in part, finding that the causation theory was plausible with respect to one out of the ten generic manufacturers. To read the whole opinion, please visit http://www.ca2.uscourts.gov/de...423bbfb3495/2/hilite/

Extended Summary: Takeda Pharmaceuticals received a patent for its diabetes drug ACTOS in the 1980s. The patent had an expiration date of January 17, 2011. Importantly, this expiration date marked the earliest point at which generic forms of ACTOS could enter the market. Takeda subsequently filed two more patents for the same drug, both of which had a later expiration date of June 19, 2016. According to the complaint, Takeda falsely represented the type of these patents to the FDA, thereby making it appear as though June 19, 2016 was the date until which generic competitors had to wait to enter the market.

Plaintiffs, purchasers of the drug ACTOS, brought a lawsuit alleging that Takeda's false descriptions of the two later patents to the FDA delayed competitors from offering generic versions of ACTOS on the market, thereby forcing plaintiffs to pay monopoly prices for longer than necessary. The district court dismissed the plaintiffs' claims, finding that plaintiff's complaint failed to adequately plead that the false descriptions had caused the generic competitors to delay entering the market.

The plaintiffs then appealed to the Second Circuit, alleging two theories of causation. The first theory was that Takeda's allegedly false descriptions of the two subsequent patents forced other pharmaceutical companies to file certifications, which triggered an exclusivity period. Plaintiffs claim that but for the false descriptions, other companies would not have filed certifications and no exclusivity period would have arisen. The Second Circuit concluded, however, that the complaint lacked the factual allegations necessary to allege that the other companies even knew Takeda had described the subsequent patents as drug product patents.

For the second theory of causation, Plaintiffs alleged that Takeda's allegedly false descriptions of the two subsequent patents caused FDA to make an announcement that they would not approve an ACTOS ANDA, and that this announcement specifically caused Teva (one of the generic manufacturers) to stall entering the market. The Second Circuit found that this theory of causation was plausible. Accrodingly, the Second Circuit affirmed the dismissal in part, and vacated it in part, explaining that the complaint could go forward specifically on "plaintiffs' theory as to Teva."

Panel: Circuit Judges Jacobs and Livingston; District Judge Rakoff

Argument Date: 09/16/2016

Date of Issued Opinion: 02/08/2017

Docket Number:
15-3364

Decided: Affirmed in Part and Vacated in Part

Case Alert Author: Alexandra Dobles

Counsel: Steve D. Shadowen, Hilliard & Shadowen LLP for Plaintiffs-Appellants; Rohit K. Singla, Munger, Tolles & Olson LLP for Defendants-Appellees

Author of Opinion: Judge Rakoff

Case Alert Circuit Supervisor:
Emily Gold Waldman

    Posted By: Emily Waldman @ 02/11/2017 05:21 PM     2nd Circuit     Comments (0)  

February 9, 2017
  Coutard v. Municipal Credit Union - Second Circuit
Headline: Second Circuit Vacates Grant of Summary Judgment to Employer who Denied FMLA Leave To Employee to Care for Grandparent

Area of Law: Employment

Issue Presented: Whether an employee gave sufficient notice for FMLA leave when it informed its employer that it needed leave to take care of a sick grandparent but not that the grandparent was in loco parentis.

Brief Summary: The Second Circuit vacated a decision by the United States District Court for the Eastern District of New York which had granted summary judgment to the Municipal Credit Union (MCU), an employer, who was sued by its employee alleging MCU improperly denied him leave to care for his grandfather under the Family and Medical Leave Act of 1993 ("FMLA"). In seeking leave, the employee had notified MCU that his grandfather was sick, but did not specify that his grandfather was in loco parentis, which would have entitled him to leave to care for him under the FMLA. The Second Circuit held that the case should not have been dismissed because an employer is obligated to inquire further whether an employee is entitled to FMLA once the employer has received sufficient information from the employee that he or she may be entitled to leave.

To read the full opinion, go to:
http://www.ca2.uscourts.gov/de...4ff747ac304/1/hilite/

Extended Summary: The Second Circuit Court of Appeals reversed a judgment of the United States District Court for the Eastern District of New York regarding an interpretation and application of the Family and Medical Leave Act of 1993 ("FMLA"), 29 U.S.C. § 2601 et seq. The plaintiff, Frantz Coutard, was employed by the defendant, Municipal Credit Union ("MCU"). As defined under the FMLA, MCU is an "employer" and Coutard is an "employee," to which the FMLA applies. Coutard sought leave from his job at MCU to take care of his seriously ill grandfather, who raised him as a child in loco parentis. Under the FMLA, employees are entitled to leave in situations when a grandfather who stood in loco parentis to the employee when the employee was a child under the age 18. When seeking leave, however, Coutard did not mention to MCO that his grandfather raised him in loco parentis. Upon Coutard's request, MCU denied leave stating that the FMLA did not cover leave to take care of a grandparent. Coutard stayed home to take care of his sick grandfather, missing work, and MCU terminated his employment.

The district court ruled that Coutard's failure to mention the nature of his relationship with his grandfather was grounds for dismissal of this case. Coutard appealed on the basis that his failure to tell MCU that his grandfather raised him in loco parentis was not dispositive because MCU did not inform its employees that an in loco parentis relationship could entitle them to FMLA leave, did not inquire whether Coutard had such a relationship with his grandfather, and when he requested FMLA leave, MCU responded categorically that FMLA did not entitle him to such leave to care for a grandparent. In response, MCU maintained that it is the employee's burden, at the time the request for leave is made, to provide all the facts needed to show the employee is entitled to leave.

The Department of Labor regulations, promulgated pursuant to the FMLA, 29 C.F.R. § 825.303(a) and (b) state that: "[a]n employee shall provide sufficient information for an employer to reasonably determine whether the FMLA may apply to the leave request. . . . When an employee seeks leave for the first time for a FMLA-qualifying reason, the employee need not expressly assert rights under the FMLA or even mention the FMLA. . . . The employer will be expected to obtain any additional required information through informal means."

Based on this regulation, the Second Circuit ruled that the obligation of an employee to give notice of his need for FMLA leave is not the obligation to provide the employer with all the necessary details for a definitive determination of the FMLA's applicability. Rather, the court found, in the absence of a request for additional information, an employee provides sufficient notice to its employer if the notice reasonably indicates that the FMLA may apply. The Second Circuit therefore held that the district court erred in ruling the Coutard's notice to MCU was deficient because he failed to specify that in loco parentis relationship with his grandfather at or before his request for FMLA leave and found that the burden was on MCU to request additional information to determine if Coutard was eligible for FMLA leave. Accordingly, the grant of summary judgment by the district court was vacated and the case was remanded for further proceedings.

To read the full opinion, go to:
http://www.ca2.uscourts.gov/de...4ff747ac304/1/hilite/

Panel: Circuit Judges Kearse, Pooler, and Sack

Argument Date: 02/10/2016

Date of Issued Opinion: 02/09/2017

Docket Number: 15-1113

Decided: Vacated and Remanded

Case Alert Author: Leigh Wellington

Counsel: Abdul K. Hassan, Abdul Hassan Law Group for Plaintiff-Appellant; Douglas E. Motzenbecker, Gordon & Rees for Defendant-Appellee.

Author of Opinion: Judge Kearse

Case Alert Circuit Supervisor:
Elyse Diamond

    Posted By: Elyse Diamond @ 02/09/2017 08:32 PM     2nd Circuit     Comments (0)  

February 3, 2017
  Metro Machine Corp. v. Dir., Office of Workers' Comp. Programs, U.S. Dept. of Labor -- Fourth Circuit
Expansive Presumption Under Longshore and Harbor Workers' Compensation Act

Areas of Law: Federal Maritime Workers' Compensation, Administrative Law

Issue Presented: Whether claims for "secondary" injuries and injuries not listed on an original claim form are entitled to the Longshore and Harbor Workers' Compensation Act's presumption that they fall within the Act unless there is substantial evidence to the contrary.

Brief Summary:
The United States Court of Appeals for the Fourth Circuit denied the petition for review of a Benefits Review Board order affirming the ALJ's grant of a medical benefits claim under the Longshore and Harbor Workers' Compensation Act ("the Act"). The Fourth Circuit rejected the petitioner's argument that only primary injuries are entitled to the statutory presumption that they fall within the Act unless there is substantial evidence to the contrary. As long as a claimant identifies a primary injury that arose during work, secondary injuries are also entitled to the presumption. Moreover, the Act does not bar recovery for an injury that a claimant fails to identify on the original claim form but that evolves as a part of the claim without prejudice to the respondent.

Extended Summary: Claimant John Stephenson ("Claimant") began working for petitioner Metro Machine Corporation ("Metro") as a pipefitter in 1983. He had a long history of breathing problems and in 1996 was diagnosed with chronic obstructive pulmonary disease (COPD). On February 18, 2008, Claimant worked in the superstructure of a vessel and inhaled fumes from welding, burning, and the application of epoxy paint for over eight hours. During a subsequent eight-day hospitalization, Claimant was prescribed steroids, inhalers, antibiotics and albuterol. Upon discharge, he was prescribed a nebulizer and oxygen concentrator. After Claimant voluntarily retired in 2011, he was treated for a T7 vertebra fracture that his doctor attributed "most likely" to excessive coughing. In 2012, Claimant filed a claim for compensation under the Act.

The Act requires employers to provide medical care to employees who suffer an "injury." The Act defines injury to include both primary and secondary injuries. Primary injuries are those that arise out of, and in the course of, employment, while secondary injuries are those that "naturally or unavoidably result[]" from primary injuries. The Act also permits a presumption that any claim filed under it is presumed to fall within the Act unless there is substantial evidence to the contrary.

The only injury Claimant identified on his original claim form was exposure to fumes on February 18, 2008, that affected his lungs. At the informal conference regarding the claim, however, the claims examiner recommended payment of benefits for both Claimant's ongoing COPD and his fractured vertebra. Despite the recommendation, the ALJ only considered Claimant's COPD claim and found that he made a prima facie case showing harm, the worsening of the COPD, and a work incident that could have aggravated the harm. Therefore, the ALJ found that the presumption applied to the claim. Claimant moved for reconsideration due to the ALJ's failure to consider his fractured vertebra claim. After granting the motion, the ALJ rejected Metro's argument that the statutory presumption did not apply to the fractured vertebra injury because the Claimant did not identify it in his original claim form. Subsequently, the ALJ found the Claimant made a prima facie case with regard to the fracture and the presumption applied. The Benefits Review Board ("Board") affirmed the ALJ's decision. With regard to the vertebra fracture, the Board rejected Metro's arguments that the presumption could not apply to the claim because: (1) it was a secondary injury; and (2) it was outside the scope of Claimant's initial claim.

On appeal, the Fourth Circuit found no reversible error and denied the petition for review. After rejecting two of Metro's evidentiary arguments regarding the COPD claim, the court turned to Metro's argument that because Claimant's fracture was secondary and not identified in the original claim form, the presumption should not have applied to this claim regardless of whether Claimant made prima facie cases. In support of its argument that secondary injuries were not entitled to the presumption, Metro relied on two split-panel decisions by the Fifth Circuit in addition to the United States Supreme Court case U.S. Indus./Fed. Sheet Metal, Inc. v. Dir., OWCP, 455 U.S. 608 (1982). The Fourth Circuit found that Metro misread U.S. Industries. Contrary to Metro's reading, that case stands for just two propositions: (1) the statutory presumption only applies to injuries actually claimed; and (2) a claim must include a primary injury. Because the ALJ found that Claimant suffered a primary injury when his COPD was exacerbated, U.S. Industries posed no obstacle.

Addressing whether the presumption applied to the vertebra fracture, the court noted that Metro did not challenge that the claim evolved to include this injury. Moreover, Metro was made aware that Claimant was seeking medical benefits for this injury as early as the initial informal conference. Metro therefore could not claim that its ability to defend itself against this claim at the ALJ hearing, 16 months after the initial conference, was prejudiced by the failure of Claimant to initially include the injury.

The court also rejected Metro's argument that the ALJ failed to apply the "naturally or unavoidably results" standard under the Act for secondary injuries. While the court did agree that the ALJ made no reference to this standard, it concluded that the evidence clearly showed that this standard was met and remanding the case would be "futile." Finally, the court rejected Metro's argument that substantial evidence did not support the ALJ's conclusion that Metro failed to rebut the presumption with regard to the fracture.

To read the full opinion, click here.

Panel: Judges Traxler, Floyd and Thacker

Argument Date: 12/8/2016

Date of Issued Opinion: 1/20/2017

Docket Number: No. 15-2525

Decided:
Petition denied by published opinion

Case Alert Author: Annie McGuire, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Frank Nash Bilisoly, VANDEVENTER BLACK, LLP, Norfolk, Virginia, for Petitioners. Gregory Edward Camden, MONTAGNA, KLEIN, CAMDEN, LLP, Norfolk, Virginia; Matthew W. Boyle, UNITED STATES DEPARTMENT OF LABOR, Washington, D.C., for Respondents. ON BRIEF: M. Patricia Smith, Solicitor of Labor, Rae Ellen James, Associate Solicitor, Mark Reinhalter, Counsel for Longshore, Sean G. Bajkowski, Counsel for Appellate Litigation, Office of the Solicitor, UNITED STATES DEPARTMENT OF LABOR, Washington, D.C., for Respondent United States Department of Labor.

Author of Opinion: Judge Traxler

Case Alert Supervisor:
Professor Renée Hutchins

    Posted By: Renee Hutchins @ 02/03/2017 01:43 PM     4th Circuit     Comments (0)  

February 2, 2017
  Ho v. ReconTrust Co.
Headline: The Ninth Circuit panel affirms that the trustee of a California deed of trust securing a non-judicial foreclosure under California state law is not a" debt collector" within the purview of the Fair Debt Collection Practices Act.

Areas of Law: Fair Debt Collection Practices Act, Consumer Finance, State (California) and Federal Civil Procedure

Issues Presented: (1) Whether the trustee of a California deed of trust is a "debt collector" pursuant to the Fair Debt Collection Practices Act where the trustee mailed a notice of default and a notice of sale to the borrower in pursuance of a non-judicial foreclosure on the borrower's home. (2) Whether the district court's dismissal, without prejudice, of plaintiff's Truth in Lending Act claim in trying to rescind the mortgage is preserved for appeal even if not repleaded.

Brief Summary: Plaintiff-Appellant Vien-Phuong Thi Ho ("Ho"), borrower, filed suit in the United States District Court for the Central District of California against Defendants-Appellees ReconTrust Company, N.A. ("ReconTrust"), trustee, and Countrywide Home Loans Inc. ("Countrywide"), lender, and Bank of America, N.A., asserting that ReconTrust violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq., ("FDCPA") because its mailing of notices of default and sale to Ho in initial pursuance of non-judicial foreclosure on Ho's California home misrepresented the amount she owed to Countrywide, 15 U.S.C. § 1692e(2)(A). The district court granted ReconTrust's motion to dismiss the FDCPA violation claim because the court decided that it was not a "debt collector." Ho also sought to rescind the mortgage transaction because she alleged that the defendants committed fraud under the Truth in Lending Act ("TILA"), 15 U.S.C. § 1635(a). The district court twice dismissed Ho's rescission claim without prejudice; Ho did not replead it in her third complaint.

Ho appealed to the Ninth Circuit and asserted that ReconTrust was a "debt collector" because the mailed notices qualified as attempts to collect debt for Countrywide and that ReconTrust fell under the purview of the FDCPA, which prohibits offensive practices by debt collectors attempting to collect debt. The Ninth Circuit panel affirmed the district court's decision that ReconTrust's notices were an enforcement of a security interest for a non-judicial foreclosure under California law, not an attempt to collect money or debt as defined by the FDCPA.

Ho also argued although she did not replead the TILA claim, her prior attempts properly preserved it and the claim should be reinstated pursuant to the court's holding in Merritt v. Countrywide Fin. Corp. 759 F.3d 1023 (9th Cir. 2014). The Ninth Circuit panel agreed with Ho and vacated the dismissal. The court remanded the case to the district court for consideration on ground that the district court erred by not giving Ho the right to replead the TILA claim.

Significance: The Ninth Circuit's decision that a trustee enforcing a security interest is not a "debt collector" within the scope of the FDCPA breaks from Fourth and Sixth Circuit decisions holding that a mortgage foreclosure, including the enforcement of a security interest, is a debt collection that is subject to the FDCPA. Thus, the circuit split illustrates the ambiguity of FDCPA's "debt collector" phrase.

Extended Summary: In June 2007, Plaintiff-Appellant Vien-Phuong Thi Ho ("Ho") purchased a home in Long Beach, California through a loan obtained from Defendant-Appellee Countrywide Bank ("Countrywide"). The loan was secured by a deed of trust with the Defendant-Appellee, ReconTrust Company, N.A. ("ReconTrust"), authorized as the trustee. By late 2008, Ho began missing loan payments. In 2009, ReconTrust initiated a non-judicial foreclosure.

In accordance with California's non-judicial foreclosure process, Cal. Civ. Code § 2924(a)(1), ReconTrust recorded a notice of default and mailed the notice to Ho. The default notice informed Ho of the initiation of non-judicial foreclosure proceedings and that her property "may be sold without any court action." The notice also advised Ho that she could bring her account "in good standing by paying all of her past due payments" to Countrywide in the amount of $22,782.68. Ho did not make any payments.

Subsequently, ReconTrust took the second step of the non-judicial foreclosure process and recorded a notice of sale and mailed the notice to Ho. Cal. Civ. Code § 2924(a)(3). The notice of sale informed Ho that her property would be sold in public auction "unless [she took] action to protect [her] property." The notice of sale also stated that ReconTrust "is a debt collector attempting to collect a debt. Any information obtained will be used for that purpose."

Ho filed suit in the United States District Court for the Central District of California against Defendants-Appellees ReconTrust, Countrywide, and Bank of America, N.A., and asserted that ReconTrust violated the Fair Debt Collection Practices Act, 15 U.S.C. § 1692 et seq. ("FDCPA"). Ho claimed the notices she received by ReconTrust's initial pursuance of a non-judicial foreclosure on her property mispresented the amount she owed to Countrywide in violation of 15 U.S.C. § 1692e(2)(A). In her suit, Ho also sought to rescind the mortgage transaction because she alleged that the defendants committed fraud under the Truth in Lending Act ("TILA"), per 15 U.S.C. § 1635(a).

ReconTrust moved to dismiss the FDCPA violation claim because it asserted that the notices of default and sale mailed to Ho were not attempts to collect on a debt owed and therefore it was not a "debt collector" under the FDCPA. The district court granted ReconTrust's motion to dismiss Ho's claims under the FDCPA.

As for Ho's TILA rescission claim, the district court dismissed it twice without prejudice and Ho did not replead it in her third complaint. In addition to these two issues, the district court also dismissed Ho's other claims under the FDCPA, the Racketeer Influenced and Corrupt Organizations Act ("RICO Act") and the Real Estate Settlement Procedures Act.

Ho appealed to the Ninth Circuit and asserted that ReconTrust was a "debt collector" because the mailed notices qualified as attempts to collect debt for Countrywide and, therefore, ReconTrust as a debt collector fell within the purview of the FDCPA. Additionally, Ho argued that though she did not replead her TILA claim in the district court it should be reinstated on appeal because the Ninth Circuit had clarified the requirements of a TILA claim in Merritt v. Countrywide Fin. Corp., 759 F.3d 1023, (9th Cir. 2014).

The first issue on appeal was whether the trustee of a California deed of trust is a "debt collector" pursuant to the FDCPA where the trustee mailed notices of default and sale to the borrower in pursuance of a non-judicial foreclosure on the borrower's home. The Ninth Circuit panel first looked at the language of the FDCPA. Under the FDCPA, a "debt collector" is liable for civil damages for abusive conduct while attempting to collect debt. §§ 1692d - f, 1692k. The FDCPA general definition of a "debt collector" is any entity that "regularly collects or attempts to collect, directly or indirectly debts owed or due or asserted to be owed or due [to] another." § 1692a(6). Under the FDCPA the word "debt" is akin to money. 15 U.S.C. § 1692a(5). Therefore, ReconTrust would be liable under the FDCPA if it was attempting to collect debt. However, the Ninth Circuit relied on Hulse v. Ocwen Federal Bank, 195 F. Supp. 2d 1188, 1204 (D. Or. 2002), which held that "foreclosing on a trust deed is an entirely different path" than "collecting funds from a debtor."

The Ninth Circuit panel concluded that the objective of a non-judicial foreclosure is to "retake and resell the security," and not collect the debt or money from the borrower. In retaking and reselling the security the trustee collects money from the home purchaser and not the original borrower, such as Ho. Therefore, ReconTrust's conduct and objective in a non-judicial foreclosure on Ho's property made ReconTrust a trustee governed under section 1692f(6) as an enforcer of a security interest and not as a "debt collector" under section 1692a.

In holding that ReconTrust was not a "debt collector" the Ninth Circuit panel broke from Fourth and Sixth Circuit decisions holding that a mortgage foreclosure, including the enforcement of a security interest, is a debt collection that is subject to the FDCPA. Glazer v. Chase Home Fin. LLC, 704 F.3d 453, 461 (6th Cir. 2013); Wilson v. Draper & Goldberg, P.L.L.C., 443 F.3d 373, 378 - 79 (4th Cir. 2006). The Ninth Circuit did agree with the sister circuits that if an entity's "only role in the debt collection process is the enforcement of a security interest" then it does not fall under the "debt collector" category. Wilson, 443 F.3d at 378; see Glazer, 704 F.3d at 464.

The panel noted that had ReconTrust taken additional actions it could possibly be classified as a "debt collector" under the general definition of the term. The panel reasoned that ReconTrust's actions fell under the umbrella of "enforcement of a security interest." Under California's non-judicial foreclosure statutes the only way ReconTrust could enforce the security interest was by sending the notice of default and notice of sale. Therefore, a trustee, such as ReconTrust, acting in compliance with California law in non-judicial foreclosure proceedings would simultaneously violate the FDCPA if the mailing of these notices constituted additional actions.

To avoid a conflict between state and federal law, the panel relied on the Supreme Court's instructions that the "FDCPA should not be interpreted to interfere with state law unless Congress clearly intended to displace that law." Sheriff v. Gillie, 136 S. Ct. 1594, 1602 (2016). The panel reasoned that the Supreme Court in Sheriff v. Gillie was trying to prevent federal encroachment on state rights especially in areas that have been traditionally a matter of state law. Since mortgage foreclosures have been traditionally a matter for the states, the "debt collector" phrase in FDCPA is ambiguous, and FDCPA provisions interfere with California state law regarding non-judicial foreclosure proceedings the Ninth Circuit applied the state law.

The second issue was whether the district court's dismissal, without prejudice, of Ho's TILA claim in trying to rescind the mortgage is preserved for appeal even if not repleaded. Ho asserted that her TILA claim should be reinstated on appeal because the Ninth Circuit had clarified the requirements of a TILA claim in Merritt v. Countrywide Fin. Corp. The panel stated that claims dismissed without prejudice and not repleaded are normally not preserved for appeal and are considered "voluntarily dismissed." Lacey v. Maricopa Cty., 693 F.3d 896, 928 (9th Cir. 2012). However, the panel concluded that Ho's case fell within the exception created by Lacey.

In Ho's case, the district court stated that Ho could replead the claim if she could declare that she had the means or ability to repay the loan. The district court judge concluded that if Ho could not make the declaration to pay the loan in good faith then she should not continue with her TILA claim. However, in Merritt, the Ninth Circuit held that a mortgagor does not have to declare the ability to repay the loan for her TILA rescission claim to survive a motion to dismiss. Following Lacey, the panel held that where the district court "dismisses a claim and instructs the plaintiff not to refile the claim unless he includes certain additional allegations that the plaintiff is unable or unwilling to make, the dismissed claim is preserved for appeal even if not repleaded."

For these reasons, the Ninth Circuit panel affirmed the district court's dismissal of Ho's FDCPA claim alleging that ReconTrust was a "debt collector," and vacated the district court's dismissal of Ho's TILA rescission claim, remanding it to the district court for consideration. In addition, the Ninth Circuit panel also affirmed the district court's dismissal of Ho's other claims under the FDCPA, the RICO Act and the Real Estate Settlement Procedures Act.

Judge Edward R. Korman, partially dissented and partially concurred. Judge Korman argued that the text and the purpose of the FDCPA is that a trustee pursuing a non-judicial foreclosure proceeding is a "debt collector" because the entity is trying to obtain debt or money by forcing the sale of the property being foreclosed upon. Judge Korman also claimed that FDCPA does not interfere with California state law for initiating or conducting non-judicial foreclosures, and therefore the FDCPA should not be overridden by state law. He asserted that other sister circuits have ruled that foreclosure proceedings are a form of debt collection subject to the FDCPA. Judge Korman concurred in vacating the district's dismissal of Ho's TILA claim and remanding it for consideration.

To read the full opinion, please visit:

https://cdn.ca9.uscourts.gov/datastore/opinions/2016/10/19/10-56884.pdf

Panel: Before: Alex Kozinski and Consuelo M. Callahan, Circuit Judges, and Edward R. Korman, Senior District Judge

Argument Date: Argued and Submitted June 5, 2015

Date of Issued Opinion: October 19, 2016

Docket Number: 10-56884

Decided: Affirmed the district court's dismissal of appellant Ho's failure to state a claim under FDCPA, and vacated the dismissal of Ho's TILA claim and remanded for consideration.



Counsel: Nicolette Glazer, Esq. (argued), Law Offices of Larry R. Glazer, Century City, California, for Plaintiff-Appellant.

Margaret M. Grignon (argued) and Kasey J. Curtis, Reed Smith LLP, Los Angeles, California; Carolee A. Hoover and David C. Powell, McGuire Woods LLP, San Francisco, California; for Defendants-Appellees.

Dean T. Kirby, Jr. and Martin T. McGuinn, Kirby & Mcguinn, A P.C., San Diego, California, for Amici Curiae United Trustee's Association, California Bankers Association, American Legal and Financial Network, Arizona Trustee Association and California Mortgage Association.

Meredith Fuchs, General Counsel, To-Quyen Truong, Deputy General Counsel, John R. Coleman, Assistant General Counsel, Nandan M. Joshi and Thomas M. McCray-Worrall, Attorneys, Consumer Financial Protection Bureau, Washington, D.C., for Amicus Curiae Consumer Financial Protection Bureau.

Author of Opinion: Judge Alex Kozinski

Partial Dissent and Partial Concurrence: Judge Edward R. Korman

Circuit: Ninth Circuit

Case Alert Author: Juan Villanueva

Case Alert Supervisor: Philip L. Merkel

    Posted By: Glenn Koppel @ 02/02/2017 07:05 PM     9th Circuit     Comments (0)  

  Ziober v. BLB Resources, Inc.
Headline: The Ninth Circuit joined other circuits in holding that the Uniformed Services Employment and Reemployment Rights Act which institutes employment rights for returning service members does not prohibit required arbitration of claims arising under its provisions.

Areas of Law: Arbitration, Labor Law, Uniformed Services Employment and Reemployment Rights Act

Issue Presented: Whether the Uniformed Services Employment and Reemployment Rights Act prohibits compelled arbitration pursuant to an arbitration clause in a service member's employment contract for claims against his former employer arising under the act.

Brief Summary: Plaintiff-Appellant Kevin Ziober ("Ziober"), a service member of the United States Navy Reserve, signed an agreement with his employer, Defendant-Appellee BLB Resources, Inc. ("BLB Resources"), compelling arbitration of any claims that should arise during the course of his employment or at his termination. Ziober later sued BLB Resources in federal court, claiming a violation of the Uniformed Services Employment and Reemployment Act of 1994 ("USERRA") on the ground he was terminated after notifying his employer that he was being deployed. The district court granted BLB Resources's motion to compel arbitration and dismissed the case holding that the USERRA did not nullify the arbitration agreement. On appeal, the Ninth Circuit panel affirmed, holding there is no indication from the USERRA's text or legislative history that Congress intended to override the Federal Arbitration Act's directive that courts enforce arbitration contracts according to their terms.

Significance: Service-members suing under USERRA can be required to arbitrate claims arising under the act if they entered a compelled arbitration agreement.

Extended Summary: Plaintiff-Appellant Kevin Ziober ("Ziober") was a service member of the United States Navy Reserve. He also worked as an operations director for Defendant-Appellee BLB Resources, Inc. ("BLB Resources"). Soon after joining BLB Resources, Ziober signed a bilateral arbitration agreement with the company that compelled binding arbitration if any dispute arose between Ziober and the company during Ziober's employment or at the time of his termination. Pursuant to the agreement the company would pay all costs for the arbitration and the remedies and discovery available in arbitration would be the same as those afforded by the courts.

The Navy later recalled Ziober into active duty and Ziober gave his employer notice of his upcoming deployment to Afghanistan. On his final day of scheduled employment, BLB Resources told him it would be his last day and that he would no longer be employed with the company upon his return.

After returning from deployment, Ziober sued BLB Resources in federal district court for violating the Uniformed Services Employment and Reemployment Rights Act of 1994 ("USERRA"), which protects reemployment rights of members serving in the armed forces. BLB Resources successfully moved to compel arbitration and the district court dismissed the case, holding that USERRA did not supersede the agreement Ziober signed with his employer.

On appeal, the Ninth Circuit panel considered whether USERRA prohibited the compelled arbitration of disputes arising under the act. The panel based its opinion on an analysis of extensive Supreme Court precedents acknowledging the federal policy supporting arbitration agreements. The panel noted that the only exception to enforcing arbitration agreements as mandated by the Federal Arbitration Act ("FAA") is when this pro-arbitration policy has been superseded by contrary congressional intent in a new statute or act.

USERRA provides, in pertinent part, that, "this chapter supersedes any matter that reduces, limits, or eliminates in any manner any right or benefit provided by this chapter, including the establishment of additional prerequisites to the exercise of any such right or the receipt of any such benefit." The panel reasoned that Ziober did not lose any substantive rights protected by the statute and that compelling arbitration did not require him to take any additional steps before vindicating his rights. The only result of compelling arbitration would be the requirement of an arbitral forum rather than a judicial forum.

The panel relied on the Supreme Court's decision in CompuCredit Corp. v. Greenwood, 132 S.Ct. 665 (2012), where the Court rejected the claim that the Credit Repair Organization Act created a procedural right to a lawsuit in court despite the Act's text which appears to contemplate judicial forums. The panel reasoned that nothing in the text of USERRA mentions compelling arbitration and, had Congress intended to prohibit the arbitration of claims under USERRA, Congress could have done so by the use of unmistakable language. Similarly, the panel found no evidence of contrary congressional intent in the act's legislative history. Thus, the panel affirmed the district court's judgment compelling arbitration.

Judge Watford concurred and joined the court's opinion, but discussed the ambiguity of USERRA. Judge Watford asserted that there were two possible interpretations of USERRA, one that prohibits an employee's waiver of his or her right to bring a suit under USERRA in a court, and another that prohibits only waiver of substantive rights under USERRA. Because nothing in the legislative history of the act settles the ambiguity, Judge Watford concurred to avoid a circuit split. He wrote that if Congress intended a contrary result, it could amend the statute.

To read full opinion, please visit:
https://cdn.ca9.uscourts.gov/datastore/opinions/2016/10/14/14-56374.pdf

Panel: Mary H. Murguia and Paul J. Watford, Circuit Judges, and Susan R. Bolton, District Judge.

Argument Date: July 5, 2016

Date of Opinion: October 14, 2016

Docket Number: 14-56374

Decided: Judgment affirmed.

Counsel:
Peter Romer-Friedman (argued) and R. Joseph Barton, Cohen Milstein Sellers & Toll PLLC, Washington, D.C.; Kathryn S. Piscitelli, Orlando, Florida; Thomas G. Jarrard, Law Office of Thomas Jarrard, PLLC, Spokane, Washington; for Plaintiff-Appellant

Lonnie D. Giamela (argued), Jimmie E. Johnson, and Nathan V. Okelberry, Fisher & Phillips LLP, Los Angeles, California, for Defendant-Appellee

Author of Opinion: Judge Murguia

Concurrence: Judge Watford

Case Alert Author: Maria Vittoria

Case Alert Supervisor: Philip L. Merkel

    Posted By: Glenn Koppel @ 02/02/2017 07:02 PM     9th Circuit     Comments (0)  

  Lynch v. Jackson -- Fourth Circuit
Debtors Filing For Bankruptcy May List Higher Amounts Than Actually Spent

Areas of Law: Bankruptcy

Issue Presented: Whether a debtor filing for bankruptcy can use the National and Local Standard amounts for expenses even if his or her actual expenses are lower.

Brief Summary:
The United States Court of Appeals for the Fourth Circuit affirmed the United States' Bankruptcy Court for the Eastern District of North Carolina's holding that debtors seeking bankruptcy relief are entitled to the full National and Local Standard amount for a category of expenses if they incur any expense within the category.

In Ransom v. FIA Card Servs., 562 U.S. 61 (2011), the Supreme Court interpreted 11 U.S.C. §707(b)(2)(A)(ii)(I), and held that an expense amount is applicable to a debtor under the provision "only if the debtor will incur that kind of expense during the life of the plan." However, the Court did not determine how a debtor should list expenses that are lower than the amounts listed in the National and Local Standards. As such, the Fourth Circuit addressed the unanswered question and determined that the plain language of the statute entitles a debtor to list the full amount provided under the National and Local Standards for expenses, even if their incurred expenses are less than the amounts listed by the Standards.

Extended Summary: On April 6, 2015, Plaintiffs Gabriel and Monte Jackson filed a Chapter 7 bankruptcy petition in the United States Bankruptcy Court for the Eastern District of North Carolina. The Jacksons made more than the median income for a family of four and therefore were required to complete a means test to determine their disposable income. A test revealing disposable income above a certain level would be considered an abuse of the bankruptcy code and would prevent the debtor from proceeding in Chapter 7. The test required the Jacksons to use Official Form 22A-1 and 22A-2 as provided pursuant to 28 U.S.C. § 2075.

These forms instruct submitters to use certain expense amounts as provided under the National and Local Standards to answer certain questions and to deduct the enumerated expense amounts "regardless of [the submitters'] actual expenses." Following the instructions provided, the Jacksons included the standard expense amounts on their forms. However, on June 3, 2015, Bankruptcy Administrator Marjorie Lynch moved to dismiss the Jacksons' petition for abusing the bankruptcy code. Lynch argued that the official form instructions were incorrect and that a Chapter 7 debtor was "limited to deducting their actual expenses or the applicable National or Local Standard, whichever [was] lesser." The Jacksons argued that the statute was unambiguous in directing debtors to use the full National and Local Standard expense amounts.

The bankruptcy court denied Lynch's motion on the basis that the Jacksons complied with the statute. Lynch filed a notice of appeal on September 23, 2015, and all of the parties subsequently jointly filed a certification to appeal directly to the Fourth Circuit on October 21, 2015. The Fourth Circuit granted the bankruptcy court's recommendation for direct appeal to address the split between bankruptcy courts within the Eastern District of North Carolina over interpretation of 11 U.S.C. § 707(b)(2). Turning to the plain language of the statute, the Fourth Circuit found that it unambiguously established that a debtor is entitled to take the full amount of the Standards' expenses if the debtor incurs any expense in that category. Consequently, the Fourth Circuit affirmed the decision of the bankruptcy court.

To read the full opinion click here.

Panel: Judges Motz, Keenan, and Thacker

Argument Date:
12/06/16

Date of Issued Opinion: 01/04/17

Amended Date: 01/05/17

Docket Number: No. 16-1358

Decided:
Affirmed by published opinion.

Case Alert Author:
Vanessa Destime, Univ. of Maryland Carey School of Law
Counsel: ARGUED: Brian Charles Behr, OFFICE OF THE BANKRUPTCY ADMINISTRATOR, Raleigh, North Carolina, for Appellant. Robert Lee Roland, IV, LAW OFFICES OF JOHN T. ORCUTT, P.C., Raleigh, North Carolina, for Appellees. ON BRIEF: Tara Twomey, J. Erik Heath, NATIONAL CONSUMER BANKRUPTCY RIGHTS CENTER, San Jose, California, for Amicus Curiae.

Author of Opinion: Judge Thacker

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 02/02/2017 09:36 AM     4th Circuit     Comments (0)  

  Ohio Valley Environmental Coalition et al. v. Fola Coal Co., LLC -- Fourth Circuit
Permit Shield Defense Fails to Protect Noncompliant Coal Company

Areas of Law: Environmental Law

Issues Presented: Whether a National Pollution Discharge Elimination System permit required its permit holder to comply with state water quality standards. Whether the trial court erred by finding that a National Pollution Discharge Elimination System permit holder violated the state water quality standards by discharging ions and sulfates in quantities sufficient to increase conductivity.

Brief Summary: In a published opinion, the United States Court of Appeals for the Fourth Circuit affirmed the District Court's judgment that the Fola Coal Company did not comply with the conditions of its permit and therefore was subject to liability under the Clean Water Act.

Extended Summary:
This case arose out of an action against appellant Fola Coal Company, LLC ("Fola") under the Clean Water Act ("Act"). Pursuant to the Act, National Pollution Discharge Elimination System ("NPDES") permits shield permit holders from liability when their pollution discharges comply with permit conditions. Acting under the approval of the Environmental Protection Agency ("EPA"), the West Virginia Department of Environmental Protection ("Department") is charged with the issuance of West Virginia NPDES permits, which incorporate state water quality regulations. Of particular significance to this case, a West Virginia regulation, titled 5.1.f, provided that permit-covered discharges may not violate applicable water quality standards, "whether or not such standards are delineated in the permit."

In 1996, Fola received a West Virginia NPDES permit, which allowed the facility to discharge into a local waterway. When Fola applied for permit renewal in 2009, it disclosed that its discharges would increase conductivity of the affected waterway in violation of state water quality standards. The Department granted the renewal but did not impose limitations on Fola's conductivity levels.

Appellees Ohio Valley Environmental Coalition, West Virginia Highlands Conservancy, and Sierra Club (collectively "the Coalition") sued Fola under the Act's citizen-suit provision in 2013. The Coalition alleged that Fola discharged ions and sulfates in quantities sufficient to cause increased conductivity and therefore violated the NPDES permit's requirement to comply with state water quality standards. In response, Fola argued that its permit shielded the company from liability, because the Department declined to impose conductivity limits when it renewed the company's permit in 2009. To support its contention, Fola emphasized two points. First, the Department issued a regulatory interpretation that shielded a permit holder from liability upon disclosing its discharges to the Department in 2013. Second, the West Virginia legislature enacted a provision that explicitly prohibited the enforcement of water quality standards against NPDES permit holders in 2015. Rejecting Fola's argument, the District Court held that NPDES permits require compliance with state water quality standards, which Fola violated by depositing significant amounts of ions into the waterway.

On appeal, Fola contended that 5.1.f. regulated the permitting authority only and therefore did not impose obligations on the company to comply with water quality standards. Moreover, in response to the District Court's finding of a violation, Fola argued that (1) it was deprived of "fair notice" of its obligation to comply with water quality standards; (2) it relied on the Department's guidance that West Virginia would not pursue enforcement action; and (3) the District Court engaged in unlawful rulemaking.

Interpreting the NPDES permit as a contract, the Fourth Circuit rejected Fola's argument and held that the text of 5.1.f unambiguously imposed an obligation on the permit holder to comply with state water quality standards. The plain language of 5.1.f and extraneous evidence supported the District Court's determination that NPDES permit holders are obligated to comply with state water quality standards. In particular, the Fourth Circuit emphasized that the Department previously pursued an enforcement action against Fola's parent company for the exact water quality standards at issue in the instant case, removing any doubt that West Virginia intended to hold permit holders liable for violating state regulations. The Fourth Circuit's judgment is consistent with its precedent, which provides that permit holders must comply with all permit terms to be shielded from liability.

Affirming the District Court's finding of a violation, the Fourth Circuit again asserted that Fola's parent company's prior history with enforcement actions provided ample, personalized notice that the NPDES permit was enforceable. The Fourth Circuit also held that, even if Fola believed that West Virginia would not pursue enforcement that did not guarantee that third-party environmental agencies would not do so under the Act's citizen-suit provision. Finally, the Fourth Circuit concluded that the District Court engaged in findings of fact, not unlawful rulemaking.

To read the full opinion, click here.

Panel: Judges Motz, Diaz, and Lee

Argument Date: October 27, 2016

Date of Issued Opinion:
January 4, 2017

Docket Numbers:
No. 16-1024

Decided: Affirmed by published opinion

Case Alert Author: Linda Morris, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Michael Shane Harvey, JACKSON KELLY PLLC, Charleston, West Virginia, for Appellant. Joseph Mark Lovett, APPALACHIAN MOUNTAIN ADVOCATES, Lewisburg, West Virginia, for Appellees. Thomas M. Johnson, Jr., OFFICE OF THE ATTORNEY GENERAL OF WEST VIRGINIA, Charleston, West Virginia, for Amici The State of West Virginia and West Virginia Department of Environmental Protection. ON BRIEF: Robert G. McLusky, Jennifer L. Hughes, JACKSON KELLY PLLC, Charleston, West Virginia, for Appellant. J. Michael Becher, APPALACHIAN MOUNTAIN ADVOCATES, Lewisburg, West Virginia; James M. Hecker, PUBLIC JUSTICE, Washington, D.C., for Appellees. Karen C. Bennett, Samuel L. Brown, Brian R. Levey, Kristy Bulleit, HUNTON & WILLIAMS LLP, Washington, D.C.; Jan A. Poling, AMERICAN FOREST & PAPER ASSOCIATION, Washington, D.C.; Amanda Waters, Erica Spitzig, NATIONAL ASSOCIATION OF CLEAN WATER AGENCIES, Washington, D.C.; Linda E. Kelly, Quentin Riegel, NATIONAL ASSOCIATION OF MANUFACTURERS, Washington, D.C.; Peter Tolsdorf, AMERICAN PETROLEUM INSTITUTE, Washington, D.C.; Tom Ward, NATIONAL ASSOCIATION OF HOME BUILDERS, Washington, D.C., for Amici American Forest & Paper Association, American Petroleum Institute, National Association of Clean Water Agencies, National Association of Home Builders, National Association of Manufacturers, National Mining Association and Utility Water Act Group. John C. Cruden, Assistant Attorney General, David S. Gualtieri, Jennifer Neumann, Environment and Natural Resources Division, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Amicus United States Environmental Protection Agency. Patrick Morrisey, Attorney General, Elbert Lin, Solicitor General, Erica N. Peterson, Assistant Attorney General, OFFICE OF THE ATTORNEY GENERAL OF WEST VIRGINIA, Charleston, West Virginia; Kristin Boggs, General Counsel, Thomas L. Clarke, Senior Policy Advisor and Counsel, WEST VIRGINIA DEPARTMENT OF ENVIRONMENTAL PROTECTION, Charleston, West Virginia, for Amici The State of West Virginia and West Virginia Department of Environmental Protection.

Author of Opinion: Judge Motz

Case Alert Supervisor:
Professor Renée Hutchins

    Posted By: Renee Hutchins @ 02/02/2017 08:45 AM     4th Circuit     Comments (0)  

  United States v. Blankenship - - Fourth Circuit
Coal Company Executive's Conviction Leads to New Directive from the Fourth Circuit

Areas of Law: Criminal Procedure

Issue Presented: Whether the district court committed reversible error in providing a "two-inference" instruction, which instructed the jury that if it "view[ed] the evidence in the case as reasonably permitting either of two conclusions - one of innocence, the other of guilt - the jury should, of course, adopt the conclusion of innocence."

Brief Summary:
In a published opinion arising from a criminal trial held in the Southern District of West Virginia, the Fourth Circuit affirmed the appellant's conviction for conspiring to violate federal mine safety laws and regulations. On appeal, the appellant argued that the district court erred in instructing the jury to choose a verdict of not guilty if the evidence equally permitted either a guilty or not guilty verdict. The Fourth Circuit held that, even though this instruction is legally correct in the instant circumstance of equal inferences, it does not describe how the jury should rule if the inference of guilt is stronger yet still not enough to be beyond a reasonable doubt. Therefore, although the use of this instruction was harmless in appellant's case and his conviction was affirmed, the Fourth Circuit directed district courts in the circuit to not use the two-inference instruction going forward.

Extended Summary: The appellant was the chairman and chief executive officer of Massey Energy Company at the time of a tragic accident in 2010. The accident occurred at the company's Upper Big Branch coal mine in West Virginia, and caused the death of 29 miners. For years preceding the accident, the company had been cited by the Mine Safety & Health Administration ("MSHA") for violations of the Mine Safety & Health Act of 1977, 30 U.S.C. § 801, and its implementing regulations. The MSHA identified 549 separate violations at the Upper Big Branch Mine in the year before the accident. Many of those violations were later determined to be key contributing factors in the accident. The appellant was aware of the violations via daily reports and warnings from other senior officials, but stated that it was "cheaper to break the safety laws and pay the fines than to spend what would be necessary to follow the safety laws." The appellant's actions were consistent with this statement, leading to the death of the miners in the accident.

After a grand jury indictment and a subsequent six-week trial, the appellant was convicted of conspiring to violate federal mine safety laws. The district court sentenced appellant to one year of imprisonment and assessed a $250,000 fine, both of which are the maximum allowable under the law for that offense.

On appeal, the appellant disputed four decisions made by the court at trial. As to the first three, the Fourth Circuit considered arguments about the sufficiency of the indictment, the denial of re-cross examination of a witness, and an instruction about the term "willfully" in the applicable statute, but found no error by the district court in any of those decisions. The appellant also challenged the district court's use of the "two-inference" instruction as reversible error.

That instruction told the jury that, if it "view[ed] the evidence in the case as reasonably permitting either of two conclusions - one of innocence, the other of guilt - the jury should, of course, adopt the conclusion of innocence." The Fourth Circuit reviewed the issue de novo to determine if the instruction "accurately and fairly state[s] the controlling law." United States v. Jefferson, 674 F.3d 332, 351 (4th Cir. 2012). The Fourth Circuit had never ruled on this particular instruction before, but noted that other federal circuits had. The Second Circuit, in United States v. Khan, 821 F.2d 90, 93 (2d. Cir. 1987), ruled that this instruction was technically correct as a matter of law, but implied that "a preponderance of the evidence standard is relevant, when it is not." Furthermore, the Second Circuit also held that this instruction "says nothing on how to decide when the inference of guilt is stronger than the inference of innocence but no[t] strong enough to be beyond a reasonable doubt."

The Fourth Circuit agreed with this interpretation and therefore "direct[ed] our district courts not to use the two-inference instruction going forward." However, despite this new directive, the Fourth Circuit concluded that the district court's decision was not reversible error because, when viewed as a whole with the several dozen other instructions on reasonable doubt provided by the district court, the government's burden was stated correctly. Therefore, with no reversible error, the Fourth Circuit affirmed the appellant's convictions.

To read the full opinion, click here.

Panel: Chief Judge Gregory, Judge Wynn, and Senior Judge Davis

Argument Date: 10/26/2016

Date of Issued Opinion: 01/19/2017

Docket Number: No. 16-4193

Decided:
Affirmed by published opinion

Case Alert Author: Patrick J.L. Dillon, University of Maryland Carey School of Law

Counsel: ARGUED: William Woodruff Taylor, III, ZUCKERMAN SPAEDER LLP, Washington, D.C., for Appellant. Steven Robert Ruby, OFFICE OF THE UNITED STATES ATTORNEY, Charleston, West Virginia, for Appellee. ON BRIEF: Michael R. Smith, Eric R. Delinsky, ZUCKERMAN SPAEDER LLP, Washington, D.C., for Appellant. Carol A. Casto, United States Attorney, R. Gregory McVey, Gabriele Wohl, Assistant United States Attorneys, OFFICE OF THE UNITED STATES ATTORNEY, Charleston, West Virginia, for Appellee. Christopher A. Brumley, Jeffrey M. Wakefield, Nathaniel K. Tawney, Wesley P. Page, Bradley J. Schmalzer, FLAHERTY SENSABAUGH BONASSO PLLC, Charleston, West Virginia, for Amici Curiae.

Author of Opinion: Judge Wynn

Case Alert Supervisor: Professor Renée Hutchins

Edited: 02/02/2017 at 09:30 AM by Renee Hutchins

    Posted By: Renee Hutchins @ 02/02/2017 08:11 AM     4th Circuit     Comments (0)  

February 1, 2017
  Fredrick Capps v. Mondelez Global LLC - Third Circuit
Headline: FMLA retaliation claim fails because employer had an honest belief that employee was misusing the FMLA

Area of Law: Employment Law

Issue(s) Presented: Did the employer's honest belief that an employee was misusing the FMLA justify summary judgment to the employer on a retaliation claim?

Brief Summary:

Frederick Capps appealed the District Court's summary judgment in favor of his former employer, Mondelez Global, LLC. Capps argued that Mondelez: (1) interfered with his rights under the Family and Medical Leave Act ("FMLA"); (2) acted in retaliation to Capps' proper use of FMLA leave; and (3) violated the Americans with Disabilities Act. The Third Circuit affirmed, holding the employer's honest belief that Capps was misusing FMLA leave defeated his FMLA retaliation claim.

Extended Summary:

Nabisco, who was Mondelez's predecessor, hired Capps in November 1989. At all relevant times to this action, Capp held the position of mixer, which required him to operate a mixing machine that makes dough. Mondelez's policy entitles an employee to FMLA leave for " a serious health condition of the employee that makes the employee unable to perform one or more of the essential functions of his/her position." The employee may use intermittent FMLA leave when it is a medical necessity and the employee must provide notice of the leave as soon as practicable. An employee who wishes to take FMLA leave due to his own serious health condition must provide the company with a certification from his health care provider. Mondelez also maintained a policy entitled "Dishonest Acts on the Part of Employees." This policy is considered a major rule and violation of such rules are considered inexcusable offenses that will result in immediate suspension pending investigation, which could lead to termination.

Capps suffers from Avascular Necrosis (AVN), and, as a result, developed arthritis in both hips, which necessitated bilateral hip replacement in 2003. Capps has experienced severe pain in the pelvic region, which sometimes lasted for days or weeks at a time. Therefore, he requested intermittent time off from work when flare-ups occurred. Capps was certified for intermitted FMLA leave following his hip replacements, and was continuously recertified every six months for his condition until his employment was terminated in 2014. In February 2013, Capps took FMLA leave on several days. On one of those days, he was arrested for drunk driving.

Upon returning to work he performed the same work and received the same salary and benefits as before taking FMLA leave. He did not report his arrest to anyone at Mondelez, nor was he required to do so. In August 2013, Capps pled guilty to a DUI. In early 2014, a Human Resources (HR) manager at Mondelez became aware of Capps' DUI conviction through a newspaper article. The HR manager and other HR employees investigated Capp's attendance record to determine if Capps had any absences during the time frame of Capp's arrest and conviction. They noticed that Capp's arrest date and court dates appeared to coincide with days on which Capps had taken FMLA leave. HR confronted Capps with this information on February 2014. Mondelez then received a letter from Capp's physician confirming that on the aforementioned dates Capps had taken FMLA leave due to his "hip pathology." Capps also submitted to Mondelez a copy of a letter dated May 31, 2013, addressed to Capps from his attorney in the DUI matter, confirming some of the dates related to his DUI action.

Capps was terminated in February 2014. The letter confirmed that Capp's termination was based on his violation of the Dishonest Acts Policy. Capps completed a Grievance form on March 2014 claiming he was unlawfully terminated. Mondelez offered Capps reinstatement without back pay on April 2014, which Capps rejected. Capps initiated this lawsuit. He alleged claims of interference and retaliation in violation of the FMLA, violations of the ADA, and violations of the Pennsylvania Human Relations Act (PHRA). Mondelez filed a motion for summary judgment, which the District Court granted. Capps appealed to the Third Circuit for review.

The Third Circuit analyzed Capps' claims of FMLA interference and retaliation. Capps claimed that Mondelez discriminated against him in violation of the FMLA by terminating his employment in retaliation for taking FMLA leave. The Court stated that FMLA retaliation claims require proof of the employer's retaliatory intent. The Court concluded that Capps could not establish a prima facie case of FMLA retaliation, and that Mondelez met its burden of demonstrating a legitimate, nondiscriminatory justification for Capps' discharge. Where an employer provides evidence that the reason for the adverse employment action taken by the employer was an honest belief that the employee was misusing FMLA leave that is a legitimate, nondiscriminatory justification for the discharge.

Capps' FMLA interference claim also failed. The Court stated that an interference claim requires an employee to show that he was not only entitled to FMLA benefits but also that he was denied those benefits. Capps argued that his termination amounted to a deprivation of benefits and therefore interference under the FMLA. The Court held that Capps was unable to show that FMLA benefits were actually withheld as he was unable to point to evidence in the record indicating that he was denied a benefit to which he was entitled under the FMLA.

Capps also argued that requests for intermittent leave may be protected by the ADA and that a request for FMLA leave does not bar an ADA retaliation claim. The Court recognized that a request for FMLA leave may qualify, under certain circumstances, as a request for a reasonable accommodation under the ADA. However, the court concluded that the record in this action did not support the view that Mondelez discriminated against Capps under the ADA or refused to accommodate any such request. The Court stated that there was a lack of evidence to show that Mondelez did not make a good faith effort in accommodating Capps's request for intermittent leave. The Third Circuit affirmed the District Court's order granting summary judgment in favor of Mondelez.


The full opinion can be found at http://www2.ca3.uscourts.gov/opinarch/153839p.pdf

Panel: Fuentes, Shwartz, Restrepo, Circuit Judges

Argument Date: July 12, 2016

Date of Issued Opinion: January 30, 2017

Docket Number: No. 15-3839

Decided: Affirmed

Case Alert Author: Cynthia C. Pereira

Counsel: Christine E. Burke, Ari R. Karpf, Counsel for Appellant; Leslie M. Greenspan, Joe H. Tucker, Jr., Counsel for Appellee; Jeremy D. Horowitz, Counsel for Amicus Appellee.

Author of Opinion: Circuit Judge Restrepo

Circuit: Third Circuit

Case Alert Circuit Supervisor: Prof. Susan L. DeJarnatt

    Posted By: Susan DeJarnatt @ 02/01/2017 03:12 PM     3rd Circuit     Comments (0)  

  Khadidja Issa v. School District of Lancaster - Third Circuit
Headline: Third Circuit Affirms District Court's Preliminary Injunction to Allow English Language Learners to Transfer to Schools of Their Choice

Area of Law: Education Law

Issue(s) Presented: Did the District Court err in granting a preliminary injunction to compel the School District of Lancaster to allow under-credited English Language Learners to transfer to a program designed to teach English language skills?

Brief Summary:

Refugees who attended school in the School District of Lancaster asked the District Court for a preliminary injunction compelling the District to allow them to transfer from Phoenix Academy to McCaskey High School's International School. McCaskey offers a program designed principally to teach language skills to English Language Learners. The District Court granted the request and found violations of Pennsylvania law and of a provision of the Equal Educational Opportunities Act of 1974. The Third Circuit affirmed the District Court's decision based on the EEOA violations but not on the state law violations.

Extended Summary:

The appellees in this action are refugees aged 18 to 21. They arrived in the United States in 2014 and international refugee agencies settled them in Lancaster, Pennsylvania. None are native English speakers. They are also considered students with limited or interrupted formal education (SLIFE). SLIFE are English language learners who are two or more years behind their appropriate grade level, possess limited or no literacy in any language, have limited or interrupted formal educational backgrounds, and have endured stressful experiences causing acculturation challenges. Khadidja Issa fled Sudan when she was five years old to escape insecurity under President Omar al-Bashir. She lived in refugee camps in Chad until she was 17, where she received her only prior schooling. Her native language is Fur and she is also fluent in Arabic. In 2015, Issa immigrated to the United States and resettled in Lancaster. When she first arrived, she couldn't speak, read, write or understand any English. She is eligible to attend public school in Pennsylvania through 2019, the year she turns 21. The other plaintiffs in the action shared similar stories, all being refugees with limited understanding of English and over-aged for their grade level.

The School District of Lancaster administers two institutions relevant to this action: McCaskey High School, which the District operates directly, and Phoenix Academy, operated by a private, for-profit company under contract with the District. McCaskey High School consists of two smaller schools, one which a traditional public high school and the other is known as an International School. The International School is a program designed primarily to teach language skills to students who speak little or no English. Students generally attend the International School for one year, during which they receive intensive English as a second language (ESL) support through a teaching method called "sheltered instruction." Under that method, English Language Learners (ELLs), are grouped together in content courses such as science and math, with other ELLs at comparable English-proficiency levels. ELLs are hence "sheltered" in those classes from other ELLs at higher proficiency levels and from native English Speakers. The International School also introduces ELLs to American cultural values and beliefs. Phoenix Academy is an alternative education program intended to serve at risk students over-age for their grade, and in danger of not graduating high school before they age out of public-school eligibility at 21. Phoenix's principal missions are to ensure that students accumulate enough credits to graduate and to change students' negative behaviors - not to further their academic proficiencies.

In order to change student's "anti-social" behaviors, Phoenix enforces stringent security measures not in effect at McCaskey. These include daily pat down searches, a strict dress code and a ban on students bringing in personal belongings such as backpacks, food, and even homework. At Phoenix, students take an accelerated curriculum which allows them to earn a high school diploma in half the time of a traditional high school. The result is that students at McCaskey, receive twenty-four more hours of instruction per class than do students at Phoenix. In regards to ESL support, Phoenix offers ELLs one 80-minute ESL course per day. ELLs take all of their content courses with Phoenix's general population under the accelerated model. In addition the School District does not assess in any measurable way whether Phoenix's program helps ELLs overcome their language barriers.

Under the District's enrollment policies new-to-the-District students over age 17 and under-credited are not offered a choice of whether to enroll at Phoenix or McCaskey. The School District unilaterally assigns them to Phoenix and doesn't allow them to transfer to McCaskey. This mandatory enrollment rule applies regardless of a student's English proficiency or educational background and even if the student has several years of public school eligibility left under Pennsylvania law. For Issa and the other plaintiffs, a common complaint is that they didn't understand the vast majority of content taught in their non-ESL classes. In addition, Phoenix's accelerated curriculum moved too quickly for them to grasp. Despite these difficulties, they accrued credits and advanced to higher-grade levels.

In 2016, the plaintiffs sued the School District in the District Court for the Eastern District of Pennsylvania, requesting a preliminary injunction allowing them and similarly situated ELLs to enroll in and attend McCaskey. The District Court granted the preliminary injunction and found likely violations of the EEOA and state law. The School District appealed, asking the Third Circuit to stay the injunction's enforcement. The Court began its analysis by interpreting the text of §1703(f) of the EEOA. The Court held that an individual alleging a violation of § 1703(f) must satisfy four elements: (1) the defendant must be an educational agency, (2) the plaintiff must face language barriers impeding her equal participation in the defendant's instructional programs, (3) the defendant must have failed to take appropriate action to overcome those barriers, and (4) the plaintiff must have been denied equal educational opportunity on account of her race, color, sex, or national origin.
The Court held that there is no dispute that the plaintiff's satisfied elements one and two of the statute. In regards to the third element that defendant must have failed to take appropriate action, the court looked to the Supreme Court's decision in Castaneda for guidance as to what entails "appropriate action." Castaneda provides a three-part test to resolve whether the School District took "appropriate action" to overcome the plaintiffs' language barriers under § 1703(f). The Court found that the Lancaster School District floundered on Castaneda's first and third prongs. The District failed to satisfy the first prong of the test as it failed to pursue a program informed by an educational theory recognized as sound by some experts in the field. Experts consistently testified that Phoenix's accelerated, non-sheltered program is unsound for SLIFE. As to the third prong, the Court held that the District failed to produce results indicating that language barriers were being overcome, as the School District does not keep data on the efficacy of Phoenix's ESL program. The Court concluded that plaintiffs had satisfied element three of the statute.

The Court also held that the plaintiffs met the fourth and final element of §1703(f). Section 1703(f) requires that the denial of the equal educational opportunity - in § 1703(f)'s case, the language barrier that is not being overcome - must stem from race, color, sex, or national origin, rather than from, for example, a cognitive disability covered by a different remedial scheme, like the Individuals with Disabilities Education Act. However it does not require a showing of discrimination. The Court concluded that the record fully supported that the plaintiff's language barriers stemmed from their national origins. Having satisfied the four elements of §1703(f), the Court affirmed the District Court's preliminary injunction for violations of the EEOA, finding the lower court had properly found the plaintiffs showed irreparable harm sufficient to justify the injunction. The Court remanded for consideration of cognizability of the state court claims.

The full opinion can be found at http://www2.ca3.uscourts.gov/opinarch/163528p.pdf

Panel: Fisher, Krause, Melloy, Circuit Judges

Argument Date: December 5, 2016

Date of Issued Opinion: January 30, 2017

Docket Number: No. 16-3528

Decided: Affirmed

Case Alert Author: Cynthia C. Pereira

Counsel: Sharon M. O'Donnell, Thomas A. Specht, Counsel for Appellant; Hedya Aryani, Seth Kreimer, Maura I. McInerney, Kristina Moon, Kathleen A. Mullen, Thomas B. Schmidt, III, Eric J. Rothschild, Molly M. Tack-Hooper, Witold J. Walczak, Counsel for Appellees; Tovah R. Calderon, Erin H. Flynn, Counsel for Amicus Appellee.

Author of Opinion: Circuit Judge Fisher

Circuit: Third Circuit

Case Alert Circuit Supervisor: Prof. Susan L. DeJarnatt

    Posted By: Susan DeJarnatt @ 02/01/2017 01:49 PM     3rd Circuit     Comments (0)  

January 27, 2017
  In re: Horizon Healthcare Services Inc. Data Breach Litigation - Third Circuit
Headline: Third Circuit Holds that Consumers Who Have Their Personal Data Stolen Can Sue for a Violation of the Fair Credit Reporting Act Even if They Cannot Show the Data Has Been Improperly Used

Area of Law: Civil Procedure

Issues Presented: Whether Plaintiffs' alleged injury of improper disclosure of personal information is sufficient to satisfy Article III standing (injury in fact), without additional injury.

Brief Summary: On the weekend of November 1 - 3, 2013, two unencrypted laptops were stolen from the headquarters of Horizon Healthcare Services, Inc. The stolen laptops contained personal identifying information and personal health information for 839,000 of Horizon's customers. After being notified of the theft, Plaintiffs (Horizon customers whose personal information was contained on the stolen laptops) filed this class action in district court against Horizon, for violation of the Fair Credit Reporting Act's (FCRA) consumer privacy requirements. The District Court ultimately dismissed Plaintiff's claim, concluding that Plaintiffs' lacked Article III standing since they had not shown that the stolen information had been used to their detriment. On appeal, the Third Circuit relied on precedent to support the proposition that the unlawful disclosure of legally protected information was a recognizable injury in itself, even if the information was never used improperly. The Court then analyzed Congress' intent regarding FCRA violations to address defendant's claim that a recent Supreme Court case, Spokeo, Inc. v. Robins, required a different result The Court concluded that "Congress believed that the violation of FCRA causes a concrete harm to consumers." Thus, the Third Circuit held that both "precedent and congressional action lead [to the conclusion] that the improper disclosure of one's personal data in violation of FCRA is a cognizable injury for Article III standing purposes." Therefore, the Court vacated the District Court's order of dismissal and remanded the matter for further proceedings consistent with the opinion. Judge Shwartz concurred in the judgment.

Extended Summary: This case concerns a class action against a health insurer, Horizon Healthcare Services, Inc., by Horizon customers. The dispute originated on the weekend of November 1 - 3, 2013, when two unencrypted laptops, containing personal information for more than 839,000 Horizon members, were stolen from Horizon's headquarters. Horizon was made aware of the theft the following day, and alerted "potentially affected members" through a press release and letters a month later. As a result of the theft of personal information (including names, dates of birth, social security numbers, and addresses), Plaintiffs filed this action on June 27, 2014, and alleged that Horizon had committed violations of the Fair Credit Reporting Act (FCRA) as well as various state laws.

FCRA was enacted "to ensure fair and accurate credit reporting, promote efficiency in the banking system, and protect consumer privacy." FCRA imposes requirements on any "consumer reporting agency" in order to protect consumer privacy. FCRA further ensures that "any such agency that either willfully or negligently 'fails to comply with any requirement imposed under [FCRA] with respect to any consumer is liable to that consumer."

Plaintiffs alleged that Horizon failed to adequately comply with FCRA requirements. Plaintiffs specifically alleged that Horizon furnished their information in an "unauthorized fashion allowing it to fall into the hands of thieves," and failed to maintain "reasonable procedures" to keep their personal information confidential. Horizon moved to dismiss for, among other things, failing to establish standing under Federal Rule of Civil Procedure 12(b)(1. The District Court granted Horizon's FRCP 12(b)(1) motion, concluding that Plaintiff's lacked Article III standing because they had not shown that the stolen information had been used to their detriment.

The Third Circuit characterized the FRCP 12(b)(1) challenge as a "facial" attack, and thus applied the same standard of review as when the Court reviews a motion to dismiss under FRCP 12(b)(6). Thus, the Court noted that they accepted "the Plaintiff's well-pleased factual allegations as true and [drew] all reasonable inferences from those allegations in the Plaintiff's favor."

The Third Circuit began its analysis by noting the three elements of Article III standing, including injury in fact, a causal connection between the injury and the conduct complained of, and that the injury will be redressed by a favorable decision. Here, the Court noted that the sole element at issue was the first element described, injury in fact. Plaintiffs claimed that "the violation of their statutory right to have their personal information secured against unauthorized disclosure constitutes, in and of itself, an injury in fact." In rejecting this argument, the district court had stated that a showing of standing must include a specific harm that goes beyond "mere violations of statutory and common law rights."

After noting that injury-in-fact determinations are "very generous," the Court proceeded to analyze the Plaintiffs' claim in light of recent Court decisions. The Court relied on a pair of recent Third Circuit decisions, both which allowed "individuals to sue to remedy violations of their statutory rights, even without additional injury. First, the Court discussed In re Google Inc. Cookie Placement Consumer Privacy Litigation, which held that "the actual or threatened injury required by Article III may exist solely by virtue of statutes creating legal rights, the invasion of which creates standing." Similarly, the Court next relied on In re Nickelodeon Consumer Privacy Ligation, holding that "'the unlawful disclosure of legally protected information' constituted 'a clear de facto injury." However, the Court then turned its attention to a recent Supreme Court decision, Spokeo, Inc. v. Robins (2016), which Horizon had relied on, arguing it necessitated the opposite outcome. However, the Third Circuit disagreed, and instead noted that Spokeo stood for the proposition that "Congress has the power to define injuries" and thus this analysis must include a determination of "whether Congress has expressed an intent to make an injury redressable." The Third Circuit further noted that it would not interpret the Spokeo decision to "erect new barriers that might prevent Congress from identifying new causes of action though they may be based on intangible harm." Instead, the Third Circuit read Spokeo to "reiterate traditional notions of standing."

Finally, the Third Circuit addressed the issue of Congress' intent. The Court concluded that by creating a private right of action in order to enforce the requirements of the FCRA, Congress illustrated that it "believed that the violation of FCRA causes a concrete harm to consumers." Therefore, because Plaintiffs alleged the unauthorized disclosure of their personal information, they have alleged the "very injury that FCRA is intended to prevent." The Third Circuit thus held that Plaintiffs' allegations constitute a "de facto injury" sufficient to satisfy the requirements of Article III standing: "Our precedent and congressional action lead us to conclude that the improper disclosure of one's personal data in violation of FCRA is a cognizable injury for Article III standing purposes." Based on this holding, the Court vacated the District Court's order of dismissal and remanded the matter for further proceedings consistent with the opinion.

Judge Shawtz wrote separately concurring in the judgment, but based this conclusion on a different analysis. The concurrence framed the issue of injury as a loss of privacy, which occurred as soon as the laptops were stolen. Judge Shwartz stated, "Plaintiffs here have suffered an injury in fact based on the loss of privacy," which injury provided the necessary standing to bring this case.
To read the full opinion, please visit http://www2.ca3.uscourts.gov/opinarch/152309p.pdf

Panel: Jordan, Vanaskie, and Shwartz, Circuit Judges

Argument Date: July 12, 2016

Date of Issued Opinion: January 20, 2017

Docket Number: No. 15-2309

Decided: Vacated and remanded

Case Alert Author: Tessa M. Carson

Counsel: Ben Barnow, Erich P. Schork, Joseph J. DePalma, Jeffrey A. Shooman, Robert N. Kaplan, David A. Straite, Laurence D. King, Philip A. Tortoreti, Counsel for Appellants; Kenneth L. Chernof, David Jay, Philip R. Sellinger Greenberg Traurig Counsel for Appellee.

Author of Opinion: Judge Jordan

Circuit: Third Circuit

Case Alert Supervisor: Professor Mark Anderson

    Posted By: Susan DeJarnatt @ 01/27/2017 12:57 PM     3rd Circuit     Comments (0)  

January 25, 2017
  Microsoft Corp. v. United States - Second Circuit
Headline: In Split, Second Circuit Declines to Rehear Case; Prior Decision Granted Motion to Quash Warrant to Compel Microsoft Corporation to Disclose Contents of E-Mails Thought to Contain Evidence of Criminal Activity Stored on Foreign Server

Area of Law:
Fourth Amendment; Search Warrants; Technology

Issue(s) Presented: Whether a full panel of the Second Circuit should rehear a motion, granted in the prior opinion, to quash a warrant issued by the United States government to Microsoft seeking to compel it to disclose private e-mails stored on a server in Ireland.

Brief Summary:
A magistrate judge issued a warrant sought by the United States government under the Stored Communications Act (SCA) requiring Microsoft Corporation, a domestically-incorporated company, to reveal the contents of private e-mails stored on a server in Ireland, but accessible by Microsoft on servers in the United States, based upon probable cause that those e-mails contained evidence of criminal activity. The United States District Court for the Southern District of New York denied Microsoft's motion to quash the warrant, but a majority panel of the Second Circuit reversed, finding that the warrant was an unlawful extraterritorial application of the SCA. The United States moved for a rehearing by the full Second Circuit court. In a four-to-four split decision, with one concurring and four dissenting written opinions, the Second Circuit denied rehearing en banc.

To read the full opinion, please visit: http://www.ca2.uscourts.gov/de...60619213ece/2/hilite/

Extended Summary:
The United States sought a warrant under the Stored Communications Act to obtain private emails that it believed contained evidence of criminal activity. The warrant was issued by a neutral magistrate judge of the United States District Court for the Southern District of New York upon a showing of probable cause. The warrant directed Microsoft Corporation, a United States corporation and service provider, to use its computer portal in Redmond, Washington to access and disclose the contents of specific e-mails that were stored on servers in Ireland. Microsoft moved to quash the warrant, and the United States District Court for the Southern District of New York denied Microsoft's motion. The original panel majority of the Second Circuit reversed the district court's decision and quashed the warrant on the ground that the warrant "was an extraterritorial application of the SCA." On the government's motion for rehearing en banc, a split four-four court declined to rehear the case. Five judges issued written opinions in the denial including Judge Carney, who concurred in the denial of rehearing, and Judges Jacobs, Cabranes, Raggi, and Droney who each issued a written dissent.

In concurring, Judge Carney wrote that the majority panel's decision to quash the government's search warrant was required under the plain language of the SCA and governing Supreme Court precedent. Specifically, given the Act's language indicating Congress's intent that the Act's warrant procedures not apply extraterritorially, Supreme Court precedent dictated that the court examine whether execution of this warrant - seeking private customer electronic data stored on servers in Ireland - would constitute an improper extraterritorial application of the SCA in light of the statute's "focus." The original panel majority found that the SCA's "focus" to be privacy protections, and the "locus" of those protections to be the place of data storage - Ireland in this case. Although agreeing with the majority in light of existing law, Judge Carney cited the challenge of balancing the needs of law enforcement with citizens' privacy in the age of modern technology and emphasized the need for congressional revision to the SCA to more effectively balance these concerns. She also highlighted sovereignty concerns with the United States accessing data of a foreign citizen in a foreign country.

In his dissent, Judge Jacobs accepted that the SCA was not intended to apply extraterritorially, but had hoped to rehear the case because, he argued, no extraterritorial reach was required in this case because the data sought was easily accessible via Microsoft's computer portals within the United States and would be delivered there. Judge Jacobs called the original majority panel's approach, which evaluated where the data was stored or located, as if it were a tangible object "unmanageable and increasingly antiquated."

Judge Cabranes also dissented from the majority's decision to deny rehearing, arguing that the opinion quashing the warrant improperly ignored that Microsoft already lawfully possessed the e-mails, could access them domestically, and would deliver them in the United States, making this a domestic, and not extraterritorial, application of the SCA. He contended that the original decision improperly focused on the storage or retrieval location in evaluating the SCA's privacy focus, rather than where the disclosure of the information would take place. Additionally, Circuit Judge Cabranes worried about the decision's "far reaching" impact on law enforcement's ability to investigate crimes.

In her dissent, Judges Raggi similarly contended that the original Second Circuit majority got the decision wrong, and that the challenged warrant applied the SCA domestically because the warrant was served on Microsoft and required delivery in the United States. She went further in challenging whether "privacy" was even the focus of the SCA. Judge Raggi notably emphasized the "disturbing consequences" of the original panel's decision to quash the warrant. Judge Droney remarked on the difficulty of the task that confronted the original Second Circuit panel in attempting to apply the SCA, drafted long ago, in the age of modern technology, but agreed with the other dissenters, that a rehearing en banc should have been granted because this did not constitute an extraterritorial application of the SCA.

To read the full opinion, please visit: http://www.ca2.uscourts.gov/de...60619213ece/2/hilite/

Panel: Chief Judge Katzmann and Circuit Judges Jacobs, Cabranes, Raggi, Hall, Chin, Carney, and Droney

Date of Issued Opinion: 01/24/17

Docket Number: No. 14-2985

Decided: Rehearing en banc denied

Case Alert Author: Samantha Hazen

Counsel: E. Joshua Rosenkranz, Orrick, Herrington & Sutcliffe LLP (Robert M. Loeb and Brian P. Goldman, Orrick, Herrington & Sutcliffe LLP, New York, NY; Guy Petrillo, Petrillo Klein & Boxer LLP, New York, NY; James M. Garland and Alexander A. Berengaut, Covington & Burling LLP, Washington, DC; Bradford L. Smith, David M. Howard, John Frank, Jonathan Palmer, and Nathaniel Jones, Microsoft Corp., Redmond, WA; on the brief), for Appellant, Justin Anderson, Assistant United States Attorney (Serrin Turner, Assistant United States Attorney, on the brief), for Preet Bharara, United States Attorney for the Southern District of New York, New York, NY, Brett J. Williamson, David K. Lukmire, Nate Asher, O'Melveny & Myers LLP, New York, NY; Faiza Patel, Michael Price, Brennan Center for Justice, New York, NY; Hanni Fakhoury, Electronic Frontier Foundation, San Francisco, CA; Alex Abdo, American Civil Liberties Union Foundation, New York, NY; for Amici Curiae Brennan Center for Justice at NYU School of Law, American Civil Liberties Union, The Constitution Project, and Electronic Frontier Foundation, in support of Appellant, Kenneth M. Dreifach, Marc J. Zwillinger, Zwillgen PLLC, New York, NY and Washington, DC, for Amicus Curiae Apple, Inc., in support of Appellant, Andrew J. Pincus, Paul W. Hughes, Mayer Brown LLP, Washington, DC, for Amici Curiae BSA | The Software Alliance, Center for Democracy and Technology, Chamber of Commerce of the United States, The National Association of Manufacturers, and ACT | The App Association, in support of Appellant, Steven A. Engel, Dechert LLP, New York, NY, for Amicus Curiae Anthony J. Colangelo, in support of Appellant, Alan C. Raul, Kwaku A. Akowuah, Sidley Austin LLP, Washington, DC, for Amici Curiae AT&T Corp., Rackspace US, Inc., Computer & Communications Industry Association, i2 Coalition, and Application Developers Alliance, in support of Appellant, Peter D. Stergios, Charles D. Ray, McCarter & English, LLP, New York, NY and Hartford, CT, for Amicus Curiae Ireland, Peter Karanjia, Eric J. Feder, Davis Wright Tremaine LLP, New York, NY, for Amici Curiae Amazon.com, Inc., and Accenture PLC, in support of Appellant, Michael Vatis, Jeffrey A. Novack, Steptoe & Johnson LLP, New York, NY; Randal S. Milch, Verizon Communications Inc., New York, NY; Kristofor T. Henning, Hewlett‐Packard Co., Wayne, PA; Amy Weaver, Daniel Reed, Salesforce.com, Inc., San Francisco, CA; Orin Snyder, Thomas G. Hungar, Alexander H. Southwell, Gibson, Dunn & Crutcher LLP, New York, NY; Mark Chandler, Cisco Systems, Inc., San Jose, CA; Aaron Johnson, eBay Inc., San Jose, CA, for Amici Curiae Verizon Communications, Inc., Cisco Systems, Inc., Hewlett‐Packard Co., eBay Inc., Salesforce.com, Inc., and Infor, in support of Appellant, Laura R. Handman, Alison Schary, Davis Wright Tremaine LLP, Washington, DC, for Amici Curiae Media Organizations, in support of Appellant, Philip Warrick, Klarquist Sparkman, LLP, Portland, OR, for Amici Curiae Computer and Data Science Experts, in support of Appellant, Owen C. Pell, Ian S. Forrester, Q.C., Paige C. Spencer, White & Case, New York, NY, for Amicus Curiae Jan Philipp Albrecht, Member of the European Parliament, in support of Appellant, Owen C. Pell, Ian S. Forrester, Q.C., Paige C. Spencer, White & Case, New York, NY; Edward McGarr, Simon McGarr, Dervila McGirr, McGarr Solicitors, Dublin, Ireland, for Amicus Curiae Digital Rights Ireland Limited, National Council for Civil Liberties, and The Open Rights Group, in support of Appellant.

Author of Opinion(s): Denial en banc (Circuit Judge Carney concurring; Circuit Judges Jacobs, Cabranes, Raggi, and Droney dissenting)

Circuit:
2nd Circuit

Case Alert Circuit Supervisor: Professor Elyse Diamond

    Posted By: Elyse Diamond @ 01/25/2017 07:27 AM     2nd Circuit     Comments (0)  

January 11, 2017
  Karsjens v. Johnson Piper - Eighth Circuit
Headline Eighth Circuit panel rules that Minnesota's sex offender civil commitment statute is constitutional

Area of Law Due Process

Issue(s) Presented Whether the district court properly determined that Minnesota's sex offender civil commitment statute violates substantive due process both facially and as applied.

Brief Summary Minnesota's Civil Commitment and Treatment Act (MCTA) permits a state district court judge to civilly commit a sexually dangerous person or a person with a sexual psychopathic personality to a secure treatment facility based on a showing of clear and convincing evidence. Such commitment is for an indeterminate period of time, but the committed person can be transferred, provisionally discharged, or fully discharged through a petition for a reduction in custody procedure set forth in the statute. Since the statute's enactment in 1994, no committed individual has been fully discharged from the Minnesota Sex Offender Program (MSOP), and only three people have been provisionally discharged.

A class of committed sex offenders filed this suit against a number of state defendants who are managers of MSOP. Plaintiffs brought facial and as applied challenges under 42 U.S.C. § 1983, claiming their substantive due process rights were violated by the MCTA and the MSOP. Following a six week bench trial, the district court agreed, and granted injunctive relief. The district court applied strict scrutiny, placing the burden on the state to show that the MCTA was narrowly tailored to serve a compelling state interest, because it found that plaintiffs had a "fundamental right to live free of physical restraint."

The state defendants appealed, alleging judicial bias, jurisdictional defects, and application of an incorrect standard of scrutiny to plaintiff's due process claims. An Eighth Circuit panel rejected the state defendants' first two arguments. As to the third issue, the panel agreed that the wrong standard of scrutiny was applied to the due process claims. The strict scrutiny standard is only applied to claims of infringement on "fundamental" liberty interests. The Supreme Court, however, has never held people who pose a significant danger to themselves or others possess a fundamental liberty interest in being free from physical restraint. Indeed, the Supreme Court has noted that many states provide for involuntary civil commitment of people who are unable to control their behavior or pose a threat to public health and safety, and thus, it is not the case that involuntary civil commitment is "contrary to our understanding of ordered liberty." As such, the Eighth Circuit held that the proper standard to apply to plaintiffs' due process claims is whether the MCTA bears a rational relationship to a legitimate government purpose.

The Eighth Circuit applied the rational basis standard to both the facial and as applied challenges to the MCTA. It held that the statute does bear a rational relationship to a legitimate Minnesota interest, and that as applied, none of the complained of actions of the state defendants was conscience-shocking. As such, the Eighth Circuit panel held that the statute does not violate plaintiffs' due process rights.

The full text of the opinion may be found at http://media.ca8.uscourts.gov/opndir/17/01/153485P.pdf

Panel Circuit Judges Colloton, Murphy, and Shepherd

Date of Issued Opinion January 3, 2017

Decided Reversed and remanded

Docket Number 15-3485

Counsel Alan Gilbert for Appellants and Daniel Gustafson for Appellees

Author Circuit Judge Shepherd

Case Alert Circuit Supervisor Joelle Larson, University of Minnesota Law School

    Posted By: Joelle Larson @ 01/11/2017 01:26 PM     8th Circuit     Comments (0)  

January 9, 2017
  Kittle-Aikeley v. Claycomb - Eighth Circuit
Headline In en banc rehearing, Eighth Circuit reverses prior ruling of three judge panel and affirms district court holding granting permanent injunction against mandatory drug testing of technical college students

Area of Law Fourth Amendment

Issue(s) Presented Whether the district court properly granted a permanent injunction prohibiting a technical college from fully implementing its new drug-testing policy requiring all incoming students to submit to urinalysis.
Brief Summary State Technical College of Missouri (Linn State) is a two-year technical college. Most of its educational programs require a significant percentage of hands-on training, some of it potentially dangerous. In 2011, Linn State adopted a policy requiring all new students to submit to drug testing in order to provide a safe and healthy educational environment, and to deter drug use and abuse among students. A group of students filed suit, alleging that the drug testing requirement violated students' Fourth Amendment right to be free of unreasonable searches. Following a bench trial, the district court upheld the drug testing requiring as applied to students in five programs involving the most safety risks to others. For the remaining 23 educational programs, the district court found the drug testing requirement to be an unconstitutional search in light of Linn State's failure to show that those programs posed significant safety risks to others. The district court granted an injunction prohibiting Linn State from drug testing students who enroll in these non-safety-sensitive programs. The district court also granted tentative attorneys' fees and costs.

On appeal, a divided panel of the Eighth Circuit reversed, finding that the district court erred in conducting a program-by-program analysis. The panel held that testing the entire incoming class of students was a reasonable and constitutional means of achieving Linn State's interest in providing "a safe, healthy, and productive environment for everyone who learns and works at [Linn State] by detecting, preventing, and deterring drug use and abuse among students."

The plaintiffs petitioned for and were granted rehearing en banc. On rehearing, the Eighth Circuit found no abuse of discretion in the district court's grant of a permanent injunction. It determined that there is a valid interest in deterring drug use among students engaged in programs posing significant safety interests to others which constitutes a "special need" for Fourth Amendment purposes. It further held that there was no error in the district court's decision to conduct a program-by-program analysis to determine whether each program posed a significant safety risk to others. This approach was in keeping with Supreme Court precedent differentiating between job categories designated for drug testing in determining the constitutionality of the testing.

The Eighth Circuit rejected appellants' arguments that safety concerns for the individual students themselves, and fostering a drug free environment, also constituted "special needs" justifying departure from the usual warrant and probable-cause requirements of the Fourth Amendment. Ultimately, the Court affirmed the district court's grant of a permanent injunction with respect to the non-safety-sensitive programs, and reversed the portion of the district court order requiring Linn State to refund the $50.00 fee students were assessed for the drug testing.

Judge Beam and Judge Loken concurred in part, and dissented in part.

The full text of the opinion may be found at http://media.ca8.uscourts.gov/opndir/16/12/133264P.pdf

Panel En Banc

Date of Issued Opinion December 22, 2016

Decided Affirmed in part, and reversed in part

Docket Number 13-3264

Counsel Kent L. Brown for Appellants and Anthony E. Rothert for Appellees

Author Circuit Judge Wollman

Case Alert Circuit Supervisor Joelle Larson, University of Minnesota Law School

    Posted By: Joelle Larson @ 01/09/2017 01:18 PM     8th Circuit     Comments (0)  

December 19, 2016
  Custodio v. Torres Samillan - Eighth Circuit
Headline Eighth Circuit panel affirms denial of petition under international child abduction statute

Area of Law International Law, Child Custody

Issue(s) Presented Whether the district court properly denied a Peruvian citizen's petition under an international child abduction statute seeking the return of his two sons removed to the United States by their mother.

Brief Summary The parties were both born and resided in Peru, and were previously married. That marriage produced two children. After the couple divorced, the children lived primarily with their mother, Torres Samillan. In 2014, Torres Samillan sought and was granted permission by a Peruvian court to take the children to the United States. The order required that they return to Peru by March 24, 2014. Shortly after arriving in the United States, Torres Samillan married an American citizen, and subsequently had a child. Meanwhile, Custodio sought and obtained four Peruvian court orders compelling the return of the children to Peru. Torres Samillan never returned the children, and Custodio filed a petition seeking return of the children under the Hague Convention on Civil Aspects of International Child Abduction (Hague Convention) and its implementing statute, the International Child Abduction Remedies Act (ICARA).

The district court denied the petition. It found that one child was 16 years old, and as such the Hague Convention no longer applied to him. With respect to the younger child, the district court applied the mature child defense in denying the petition, and credited the child's testimony that he wished to remain in the United States with his mother and was afraid of his father. Custodio appealed, and a panel of the Eight Circuit affirmed the denial with respect to both children.

Concerning the elder child, the Eighth Circuit held that the language of the Hague Convention and the State Department's interpretation of the Convention make clear that it ceases to apply to children once they reach the age of 16. Because the elder child had turned 16 years old during the pendency of the proceedings, the Hague Convention no longer applied to him.

With regard to the younger child, who was 15 years old, the court affirmed the district court's application of the mature child defense, which is an affirmative defense to the Hague Convention. It requires that the child be of an age and level of maturity that it is appropriate to take its views into account, and that the child objects to being returned. The proper standard of review to apply to a child's objections was a matter of first impression for the Eighth Circuit, which followed out-of-circuit authority in determining that the child's objection is subject to a clear error standard of review. Here, the district court observed the child twice, in chambers and in open court subject to cross examination. The district court found the child to be thoughtful, intelligent, and genuine. The district court credited his testimony that he wished to remain with his mother, brothers, and stepfather, and did not want to return to Peru because he was afraid of is father and preferred his school and friends in America. A mature child's views on return can be conclusive, and the district court did not commit clear error in finding that the child's statements supported denial of the petition based on the mature child defense.

The full text of the opinion may be found at http://media.ca8.uscourts.gov/opndir/16/12/161268P.pdf

Panel Circuit Judges Arnold, Kelly, and Wollman

Date of Issued Opinion December 2, 2016

Decided Affirmed

Docket Number 16-1268

Counsel Gregory J. Minana for Appellant and Kelley Farrell for Appellees

Author Circuit Judge Kelly

Case Alert Circuit Supervisor Joelle Larson, University of Minnesota Law School

    Posted By: Joelle Larson @ 12/19/2016 12:57 PM     8th Circuit     Comments (0)  

  Keefe v. Adams - Eighth Circuit
Headline Eighth Circuit panel affirms summary judgment regarding removal of student from nursing program due to Facebook posts

Area of Law First Amendment

Issue(s) Presented Whether the district court properly granted summary judgment to defendant college administrators who removed plaintiff from the college nursing program due to student complaints about posts on plaintiff's Facebook page.

Brief Summary Plaintiff was a nursing student at Central Lakes College (CLC). Plaintiff posted to his Facebook page about his frustrations with and feelings toward other students in the program. Multiple students reported Plaintiff's posts to nursing program administrators because they found the posts threatening and were uncomfortable and nervous around plaintiff in class as a result. The Director of Nursing and the Dean of Students met with plaintiff to discuss the posts, and based on plaintiff's "lack of remorse, lack of concern" and failure to meet ethical standards of the nursing profession, the Director of Nursing removed plaintiff from the program.

After his administrative appeal was denied, plaintiff filed this lawsuit against CLC administrators alleging violations of his First Amendment and due process rights. The district court granted summary judgment to the defendants. On appeal, a panel of the Eighth Circuit affirmed.

The panel found that Plaintiff's First Amendment rights were not violated. Professional codes of ethics, such as the Nurses Association Code of Ethics CLC required its nursing students to uphold, are a legitimate part of a professional school's curriculum and do not run afoul of the First Amendment on their face. Further, college administrators in a professional school have discretion to require compliance with the recognized professional standards both on and off campus. Plaintiff's posts were found to be non-compliant with the professional ethical standards, and the First Amendment does not bar administrators from determining that, as a result, Plaintiff was unable to meet the professional demands of being a nurse.

The panel further found that the CLC administrators had not violated Plaintiff's due process rights. The US Supreme Court has adopted a deferential standard when reviewing academic dismissals, requiring a showing of arbitrariness or capriciousness. That standard was not met here. The decision to remove Plaintiff from the nursing program due to unethical and unprofessional behavior was a reasoned academic decision, and defendants allowed Plaintiff to remain at CLC and transfer his credits to another program. Procedurally, Plaintiff had notice, an explanation of why his behavior fell short of the standards of the program, a face-to-face meeting with administrators, an opportunity to respond to the allegations against him, and an chance to appeal the adverse decision. This was sufficient to meet the requirements of the Fourteenth Amendment.

Circuit Judge Kelly concurred in part and dissented in part.

The full text of the opinion may be found at http://media.ca8.uscourts.gov/opndir/16/10/142988P.pdf

Panel Circuit Judges Kelly, Loken, and Shepherd

Date of Issued Opinion October 26, 2016

Decided Affirmed

Docket Number 14-2988

Counsel Jordan S. Kushner for Appellant and Kathryn Morrell Woodruff for Appellees

Author
Circuit Judge Loken

Case Alert Circuit Supervisor
Joelle Larson, University of Minnesota Law School

    Posted By: Joelle Larson @ 12/19/2016 12:54 PM     8th Circuit     Comments (0)  

December 7, 2016
  United States v. Rand -- Fourth Circuit
To Quash or Not to Quash: Fourth Circuit Establishes Standard for Third-Party Subpoenas

Areas of Law: Sixth Amendment, Criminal Procedure

Issue Presented: Whether evidentiary requirements imposed on prosecutors seeking subpoenas also apply to third parties.

Brief Summary: In a published decision written by Chief Judge Gregory, the United States Court of Appeals for the Fourth Circuit wrote, in an issue of first impression, that the district court for the Western District of North Carolina properly used the Nixon test (established in United States v. Nixon, 418 U.S. 683, 689-99 (1974)) when it determined that the appellant's request for a subpoena should be quashed. The appellant claimed: that the Nixon test applied only to prosecutors seeking subpoenas and that the standard embodied in Rule 17(c) of the Federal Rules of Criminal Procedure was the correct standard and thus, his third-party subpoena should not have been quashed because it did not meet the Rule 17(c) standard. The Fourth Circuit disagreed, declined to adopt a lower standard for third-party subpoenas, and wrote that the Nixon standard is not at odds with its interpretation of the Rule 17(c) standard. The Fourth Circuit found that the district court's use of the Nixon standard was correct and for this reason, as well as others established in the opinion, affirmed all of the challenged aspects of the appellant's convictions and sentence.

Extended Summary: This case involved Michael Rand, chief accounting officer of Beazer Homes USA, Inc. (Beazer). Rand was under federal investigation because the government believed he was misrepresenting the company's reported quarterly earnings. There was evidence indicating that Rand engaged in "cookie jar" accounting - the process by which money reserved for a business' future expenditures is taken from or added to the reserve in order to misstate the business' earnings. The government also believed that Rand failed to properly account for transactions involving sale-lease back agreements. These agreements required Rand to sell model homes to investors on behalf of Beazer. Rand would then rent the homes back from those investors until the homes could be sold to third parties. This allowed Beazer to share in the appreciation of the homes even after they were sold.

In March 2007, the FBI began its investigation of Beazer for mortgage fraud. A federal grand jury subpoena was issued to the company on March 23, 2007. The subpoena required the company to keep all emails and documents pertaining to mortgages and sales. On March 28, the company created an email "dumpster." This device saves all deleted emails from employees' trash folders without the employees' knowledge, thereby preventing permanent deletion. By March 30, Beazer's in-house counsel had instructed all employees to not destroy any records, and told Rand directly that he was required to keep everything. That day, and the day before, Rand deleted almost 6,000 emails. In June, Beazer brought in an auditing firm to conduct an internal investigation of its employees. By July 2008, the FBI had interviewed Rand multiple times. During these interviews, Rand admitted 1) to manipulating Beazer's earnings, 2) to the improper sale-lease back agreements, 3) to his mass deleting of emails, and 4) that he knew his conduct was illegal.

Rand was charged with several counts of conspiracy, securities fraud, mismanagement, improper accounting transactions, and obstruction of justice. A jury convicted Rand of seven counts and acquitted him of four. However, Rand was given a new trial due to juror misconduct. The government proceeded on two counts of conspiracy (including wire fraud conspiracy) and three counts of obstruction of justice. Rand was convicted of all five counts. Using the government expert's method of loss calculation to determine Rand's sentence, the district court found a loss of $135 million. This equated with an offense level of 51, resulting in an adjusted offense level of 43 and an advisory guideline sentence of life in prison. The district court ultimately sentenced Rand to 120 months in prison.

Rand appealed to the United States Court of Appeals for the Fourth Circuit. He claimed that the district court made several improper evidentiary rulings. First, Rand argued that the district court abused its discretion when it quashed his subpoena to Beazer, pursuant to Federal Rule of Criminal Procedure 17(c). This presented an issue of first impression for the Fourth Circuit.

Rule 17(c) permits a district court to quash a subpoena if compliance with the subpoena would be unreasonable or oppressive. In 1974, in United States v. Nixon, the Supreme Court instituted a four-part test, establishing the burden that is placed on the subpoena-requesting party. The test requires:(1) that the documents are evidentiary and relevant; (2) that they are not otherwise procurable reasonably in advance of trial by exercise of due diligence; (3) that the party cannot properly prepare for trial without such production and inspection in advance of trial and that the failure to obtain such inspection may tend unreasonably to delay the trial; and (4) that the application is made in good faith and is not intended as a general "fishing expedition." The Nixon Court refined the test into three requirements: relevance, admissibility and specificity.

Rand argued that the Nixon test was only applicable to the prosecution's subpoenas, not to subpoenas issued to third parties - and that the "unreasonable or oppressive" standard, explained in Rule 17(c) was the correct standard. However, the Nixon Court did not decide whether a standard lower than "unreasonable or oppressive" exists because the district court in that case properly quashed the subpoena. The Fourth Circuit has applied the Nixon test to third parties in previous cases, but has also not considered how the Rule 17(c) evidentiary requirement - "unreasonable or oppressive" - should apply to third party subpoenas. Additionally, no federal circuit has applied the Rule 17(c) standard without also employing the Nixon standard in tandem. The Fourth Circuit found that Rand's argument that the Nixon standard was a higher standard that was inconsistent with both Rule 17(c) and his Sixth Amendment right to secure evidence in his favor was flawed. Consequently, the court declined to adopt a lower standard for third party subpoenas and found that the district court's use of the Nixon standard was proper. The Fourth Circuit added that the Nixon standard was not in conflict with the court's interpretation of Rule 17. Therefore, Rand's requests to subpoena Beazer for financial reports over an eight-year period was a "fishing expedition" that the district court rightfully prohibited under Nixon.

The Fourth Circuit also rejected Rand's claims regarding the limitation on certain testimony by a defense expert, the admission of certain lay opinion testimony by government witnesses, and improper comments by the prosecutor during closing. Finally, the court rejected Rand's complaint that his 120-month sentence was procedurally unreasonable.

To read the full opinion, click here.

Panel: Chief Judge Gregory, Judges Niemeyer and Harris

Argument Date: 05/12/2016

Date of Issued Opinion: 08/26/2016

Docket Number: No. 15-4322

Decided: Affirmed by published opinion

Case Alert Author: Vanessa Destime, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Seth Paul Waxman, WILMER CUTLER PICKERING HALE AND DORR LLP, Washington, D.C., for Appellant. Amy Elizabeth Ray, OFFICE OF THE UNITED STATES ATTORNEY, Asheville, North Carolina, for Appellee. ON BRIEF: Stephen D. Councill, ROGERS & HARDIN LLP, Atlanta, Georgia; Claire J. Rauscher, WOMBLE CARLYLE SANDRIDGE AND RICE LLP, Charlotte, North Carolina; Brent J. Gurney, Jeannie S. Rhee, Kelly P. Dunbar, Matthew Guarnieri, WILMER CUTLER PICKERING HALE AND DORR LLP, Washington, D.C., for Appellant. Jill Westmoreland Rose, United States Attorney, Maria K. Vento, Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Charlotte, North Carolina, for Appellee.

Author of Opinion: Chief Judge Gregory

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 12/07/2016 11:38 AM     4th Circuit     Comments (0)  

  Clem v. Fleming, Warden, Keen Mountain Correctional Center -- Fourth Circuit
Common Courtesy - Fourth Circuit Instructs District Court to Wait for Virginia Supreme Court's Ruling Before Resolving Habeas Petition

Areas of Law: Constitutional Law, Criminal Law, Habeas Corpus

Issue Presented: Whether the Virginia statute that mandates life imprisonment without parole for juveniles convicted of capital murder violates the United States Supreme Court's holding in Miller v. Alabama, 132 S. Ct. 2455 (2012).

Brief Summary: The United States Court of Appeals for the Fourth Circuit vacated the district court's order denying Jason Clem's successive habeas petition. Clem argued that his sentence as a juvenile to life without parole violated the Eighth Amendment, and the Supreme Court's ruling in Miller v. Alabama, 132 S. Ct. 2455 (2012). The Fourth Circuit remanded the case, but instructed the district court not to rule on Clem's petition until after the Supreme Court of Virginia rules on Jones v. Commonwealth, 763 S.E.2d 823 (Va. 2014), a case challenging the same Virginia sentencing statute.

Extended Summary: On March 8, 2004, Clem was indicted in Virginia for capital murder after he hit a co-worker with a hammer and then stabbed the co-worker with a knife. The co-worker died because of the attack.

On May 12, 2005, a jury found Clem guilty of capital murder. Because Clem was 16-years old at the time of his conviction, the judge instructed the jury that it could not sentence Clem to death. Instead, under Virginia law the jury could either impose a sentence of life imprisonment, or life imprisonment with a fine up to $100,000. The jury returned a verdict of life imprisonment with a $100,000 fine. After a sentencing hearing where the judge heard evidence of Clem's "tumultuous upbringing and history of mental illness" the judge found "no reason to deviate from the jury verdict," and imposed a sentence of life without parole and a $100,000 fine.

The Supreme Court of Virginia denied relief on direct appeal. Clem also unsuccessfully filed a state habeas petition wherein he argued that sentencing a juvenile to life without parole was cruel and unusual punishment. The Supreme Court of Virginia found Clem was procedurally barred from making the claim because it had not been raised on direct appeal. The United States District Court for the Western District of Virginia also rejected Clem's federal habeas petition where he presented similar arguments.

When the United States Supreme Court decided Miller v. Alabama, 132 S. Ct. 2455 (2012) seven years later, Clem filed an authorized successive habeas petition in district court, challenging his sentence. In Miller, the Court held that the Eighth Amendment prohibits a mandatory life sentence without the possibility of parole for juveniles. Miller also requires a judge or jury to consider mitigating circumstances, including the juvenile's youth and attendant circumstances, during sentencing. On review of Clem's petition, the district court assumed, without deciding, that Miller applied retroactively, and found that Clem was excused from exhausting all of his state remedies before filing a federal habeas petition. However, the district court denied Clem's petition, finding that the judge in the original sentencing hearing considered mitigating factors consistent with the Miller requirements. While Clem's appeal to the Fourth Circuit was being decided, the United States Supreme Court expressly declared that the Miller rule is a substantive rule that applies retroactively. Montgomery v. Louisiana, 136 S. Ct. 718 (2016).

The Fourth Circuit found that Clem had not exhausted all his state remedies because he never raised a Miller claim in the state court. However, the court reasoned that requiring exhaustion would provide no real remedy for Clem because of Virginia's statute of limitations for habeas petitions.

The Fourth Circuit also instructed the district court to wait for the Supreme Court of Virginia to rule in Jones v. Commonwealth, 763 S.E.2d 823 (Va. 2014), before ruling on Clem's habeas petition. Jones challenged the same Virginia statute that Clem challenged in his petition. The Supreme Court of Virginia ruled on Jones after Clem's federal habeas petition was already dismiss. Even though the Supreme Court of Virginia assumed that the Miller rule applied retroactively when deciding Jones, the United States Supreme Court vacated the ruling. The Supreme Court remanded Jones, and instructed the Supreme Court of Virginia to re-consider Jones' petition, because the Supreme Court officially declared that the Miller rule applied retroactively in Montgomery. The outcome in Jones may give Clem a state remedy that he has yet to exhaust or may allow the federal district court to rule because Clem has exhausted all his state remedies.

In a brief concurrence, Senior Judge Davis noted that the Supreme Court of Virginia already assumed the ruling in Miller applied when deciding Clem's petition, so the Court's announcement in Montgomery that Miller applied retroactively should be inconsequential. Judge Davis also reasoned that determining whether a state law violates the Eighth Amendment under Miller and Montgomery is a federal issue, not a state issue.

To read the full opinion, click here.

Panel: Judges Traxler and Duncan, and Senior Judge Davis.

Argument Date: 09/20/2016

Date of Issued Opinion: 10/19/16

Docket Number: No. 14-6682

Decided:
Vacated and remanded by unpublished per curiam opinion. Senior Judge Davis wrote a separate concurring opinion.

Case Alert Author: Fernando Kirkman, Univ. of Maryland Carey School of Law

Counsel:
ARGUED: Amy Lynn DeLine, SIDLEY AUSTIN LLP, Washington, D.C., for Appellant. Robert H. Anderson, III, OFFICE OF THE ATTORNEY GENERAL OF VIRGINIA, Richmond, Virginia, for Appellee.

ON BRIEF: Guy S. Neal, Matthew J. Warren, SIDLEY AUSTIN LLP, Washington, D.C., for Appellant. Mark R. Herring, Attorney General of Virginia, OFFICE OF THE ATTORNEY GENERAL OF VIRGINIA, Richmond, Virginia, for Appellee.

Author of Opinion:
Per Curiam

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 12/07/2016 11:25 AM     4th Circuit     Comments (0)  

  Smith v. Baltimore City Police Department, et al. - Fourth Circuit
First 'Rodeo'? Try Again - Fourth Circuit Reverses Judgment in Favor of Baltimore City Police Department for Evidence Error

Areas of Law: Evidence, First Amendment, Fourth Amendment

Issue Presented: Whether the district court committed reversible error in admitting evidence of appellant's prior arrests in order to properly calculate damages in a police misconduct case.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that the district court abused its discretion and committed reversible error by admitting appellant's prior arrest as evidence relevant to her claim for damages. The Fourth Circuit found the evidence was not relevant to damages and was prejudicial to Ms. Smith. Thus, the court reversed and remanded the judgment for a new trial.

Extended Summary: In May 2013, Makia Smith sued the Baltimore City Police Department ("BCPD"); then-BCPD Commissioner Anthony Batts; Officers Church and Campbell; and two other officers at the scene, Officers Pilkerton Jr. and Ulmer (collectively, "Appellees"). Ms. Smith testified that she saw two police officers arresting a teenager while she was driving with her daughter on Harford Road and became concerned when she saw one of the officer's knees pressed against the teen's temple. Ms. Smith stopped, got out of her car, and pulled her cell phone out to record what the officers were doing. Officer Church noticed her videotaping and ran toward her. According to Ms. Smith's testimony, she tried to get back in her car when Officer Church snatched the phone from her hand and stomped it. Ms. Smith testified that Officer Church then grabbed her by her hair and dragged her out of the car. She responded by punching, scratching and kicking him. Ms. Smith testified that she felt three or four other people join in the beating, and then blacked out when someone hit her in the back of her head. While she was being arrested, Ms. Smith remembered asking Officer Church if she could call her mother to pick up her daughter, to which Officer Church responded, "No. Child Protective Services will be here to get [her]."

Contrary to that testimony, Officer Church testified that he received a call for back up at Hartford Road. When he arrived, several teenagers were running through the street while Officer Jackson was attempting to arrest another teen. As Officer Church assisted Jackson in his efforts, he heard tires screech as multiple cars came to a stop. When he looked up, he testified that he saw Ms. Smith's car blocking traffic and saw Smith standing behind her car holding her phone up, as if she was videotaping. Officer Church testified that he told Ms. Smith to pull her car to the side or keep moving. She refused, so Officer Church "quickstepped" toward Ms. Smith and told her to move again. She refused again, so he moved closer and told her this was a traffic stop and asked for her license. At that point, Ms. Smith ran back to her car and Officer Church followed, reaching into her car to try to grab her keys. Officer Church testified that Ms. Smith started kicking, punching, and scratching him, so he reaching into the car and pulled her out. He then handcuffed her and began to arrest her. Ms. Smith was arrested and charged with various offenses, but the charges were eventually dropped via a nolle prosequi disposition.

Ms. Smith filed suit on May 8, 2013, alleging excessive force, § 1983 claims for First and Fourth Amendment violations, battery, and false arrest. On March 9, 2015, Ms. Smith filed a motion in limine to exclude all evidence or discussion of her prior arrests: a) second degree assault in 2005, b) fleeing and eluding in 2006, and c) second degree assault in 2010. None of those arrests resulted in convictions. At trial, the judge admitted evidence of Ms. Smith's prior arrests. The district court explained that the evidence was relevant to determine whether Ms. Smith suffered pain and suffering resulting from her encounter with Officer Church. The judge, in admitting the evidence, instructed the jury that the evidence could not be used to attack Ms. Smith's credibility. On cross-examination, Appellee's counsel asked Smith whether this was her "first rodeo," to which Ms. Smith's counsel objected. The district court overruled the objection, again reasoning that the evidence of the prior arrests may be relevant to determining the amount of emotional damages. Ultimately, the jury returned a verdict in favor of Officers Church and Campbell on all counts. Ms. Smith timely appealed.

The Fourth Circuit reviewed the district court's decision for abuse of discretion in what it classified a "classic he-said, she-said" dispute. The sole issue on appeal was whether the district court committed reversible error in admitting evidence of Smith's prior arrests. The appeal turned on whether Smith's prior arrests, which did not involve struggles with police, made it more or less probable that she suffered emotional damage. The court determined that the district court erred because this evidence was not relevant to damages and was prejudicial to Ms. Smith.

On the relevance question, the Fourth Circuit began its analysis by citing Federal Rule of Evidence ("FRE") 404(b), which prohibits the admission of prior-act evidence, and imposes a four-part test for assessing the admissibility of that evidence. The court noted that admission of prior-act evidence under FRE 404(b) is appropriate to assist the jury in measuring the extent of damages. However, the court explained, the evidence must still have probative value on the question of damages. The court relied heavily on Nelson v. City of Chicago, 810 F.3d 1061 (7th Cir. 2016) in finding that Smith's prior arrests were not relevant to the extent of her damages. Citing Nelson, the court reasoned that Smith's claims were directly related to the underlying encounter with the police, not her feelings toward police generally. This, the court remarked, was evidenced by Smith's testimony during cross-examination that she had "never had an interaction like this with an officer before." Further, the court admonished the Appellee's failure to disprove Smith's testimony by instead asking if this were Smith's "first rodeo," therefore hinting that she had been arrested before. The Fourth Circuit determined that the Appellees' line of questioning was a "clear indication that the evidence was being used to show character and propensity, rather than to demonstrate the extent of her damages." Finally, the court explained that the admission of Smith's prior arrests, which were not at all similar in nature to the underlying case, permitted the jurors to "fill in the gaps and let their imaginations run wild." Accordingly, the Fourth Circuit held the district court abused its discretion by admitting evidence irrelevant to damages for the purpose of credibility, propensity, and character of Smith.

Regarding prejudice, the court found the risk of prejudice from the mention of Smith's prior arrests was "enormous." Citing Nelson, the court remarked that admission of prior-act evidence generally impugns character and makes it difficult for a jury to draw a distinction between an arrest and a legal finding of wrongdoing. The court also noted that a judge could mitigate prejudice by giving a "carefully framed" limiting instruction telling the jurors to only consider the evidence of prior arrests insofar as it relates to determining the extent of a plaintiff's emotional damages. The Fourth Circuit found the district court judge's instructions insufficient and "meager" at best. The court reasoned that, while the district court instructed the jury to consider the testimony on the issue of damages, it did not confine the jury's consideration to that issue or mention "character" or "propensity to break the law," both of which are prohibited by FRE 404(b). That, the Fourth Circuit concluded, was enough to make the prejudice far outweigh the perceived probative value of Smith's prior arrests.

In addition to finding error, the court was tasked with determining whether the error was harmless. Here, the Fourth Circuit could not say with fair assurance the judgment was not substantially swayed by the admission of Smith's prior arrests. The court noted that the main issues in the case hinged on which witness the jury believed, therefore making Smith's credibility and character central to its verdict. Thus, the court reasoned, once the jury heard the evidence of Ms. Smith's prior arrests, it was reasonable for the jury to assume "where there's smoke, there's fire." Moreover, the court explained that the insufficient limiting instruction failed to mitigate the "naturally flowing" prejudice from the questioning. As a result, the Fourth Circuit held that the error was not harmless. Therefore, the court reversed the judgment of the district court and remanded the case for a new trial.

To read the full opinion, click here.

Panel: Keenan, Floyd, and Thacker, Circuit Judges

Argument Date: 09/20/2016

Date of Issued Opinion: 11/01/2016

Docket Number: No. 15-1604

Decided: Reversed and remanded by published opinion

Case Alert Author: Yvette Pappoe, Univ. of Maryland Carey School of Law

Counsel: Lawrence S. Greenberg, GREENBERG LAW OFFICE, Baltimore, Maryland, for Appellant. Suzanne Sangree, BALTIMORE CITY LAW DEPARTMENT, Baltimore, Maryland, for Appellees. ON BRIEF: Zebulan P. Snyder, GREENBERG LAW OFFICE, Baltimore, Maryland, for Appellant. George Nilson, City Solicitor of Baltimore City, William R. Phelan, Chief Solicitor, Glenn Marrow, Chief of Police Legal Affairs Division, BALTIMORE CITY LAW DEPARTMENT, Baltimore, Maryland, for Appellees.

Author of Opinion: Judge Thacker

Case Alert Circuit Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 12/07/2016 09:43 AM     4th Circuit     Comments (0)  

  Wells Fargo Equip. Fin., Inc. v. Asterbadi -- Fourth Circuit
Clock Is Reset: Limitation Period for Enforcement Begins to Run on Date of Registration of Foreign Judgment

Areas of Law:
Civil Procedure

Issue Presented: Whether Maryland's 12-year limitation period for enforcement on a foreign monetary judgment begins to run on the date of its registration in Maryland.

Brief Summary: The United States Court of Appeals for the Fourth Circuit affirmed the district court's decision that a monetary judgment the plaintiff obtained against the defendant in Virginia, which the plaintiff registered in Maryland pursuant to 28 U.S.C. § 1963, was enforceable against the defendant in Maryland. The Fourth Circuit construed § 1963 to provide for a new judgment in the district court where the judgment was registered. The Fourth Circuit held that with the registered judgment functioning as a new judgment, Maryland's 12-year limitation period for enforcement ran from the date of registration.

Extended Summary: The enforceability of a registered foreign monetary judgment is governed by 28 U.S.C. § 1963. The statute provides that "a judgment in an action for the recovery of money . . . entered in any . . . district court . . . may be registered . . . in any other district . . . . A judgment so registered shall have the same effect as a judgment of the district court of the district where registered and may be enforced in like manner."

On October 4, 1993, CIT/Equipment Financing, Inc. ("CIT") obtained a $2.63 million judgment against Nabil J. Asterbadi ("Asterbadi") in the United States District Court for the Eastern District of Virginia ("the Virginia Judgment"). The judgment arose from a defaulted debt that Asterbadi incurred to invest in an airplane. Under Virginia law, the judgment remained enforceable for 20 years, i.e., until October 4, 2013. On August 27, 2003, in furtherance of its collection efforts, CIT registered the judgment in the United States District Court for the District of Maryland ("the District Court") pursuant to 28 U.S.C. § 1963. Under Maryland Rule 2-624, "a money judgment expires 12 years from the date of entry or most recent renewal."

In 2007, CIT sold and assigned its judgment against Asterbadi to Wells Fargo Equipment Finance, Inc. ("Wells Fargo"). On April 7, 2015, Wells Fargo began collection efforts and filed a notice of the assignment in the District Court.

Asterbadi argued that Maryland's 12-year limitation period for enforcement on the registered judgment began to run on the date that the Virginia judgment was entered, i.e., on October 4, 1993. Thus, Asterbadi argued that the registered judgment was unenforceable, as its enforceability expired on October 4, 2005, 12 years after 1993. Wells Fargo argued that when the Virginia judgment was registered in Maryland, it became, "in effect, a new judgment" governed by Maryland's 12-year limitation, which began to run on the date of registration, i.e., August 27, 2003. Thus, Wells Fargo argued, the registered judgment would expire on August 27, 2015. On August 26, 2015, Wells Fargo filed a renewal of the registered judgment in the District Court, which it contended, extended the judgment's enforceability under Maryland law to 2027.

The District Court agreed with Wells Fargo, holding that Maryland's time limitation for enforcement of the registered judgment began to run on the date of its registration in Maryland, August 27, 2003, and that the judgment was still enforceable against Asterbadi.

The Fourth Circuit affirmed the District Court's decision. The Fourth Circuit began its analysis by examining the legislative intent of 28 U.S.C. § 1963. The Fourth Circuit discussed three other circuits' cases Stanford v. Utley, 341 F.2d 265 (8th Cir. 1965), Home Port Rentals, Inc. v. International Yachting Group, Inc., 252 F.3d 399 (5th Cir. 2001), and Stiller v. Hardman, 324 F.2d 626 (2d Cir. 1963). Based on these cases, the Fourth Circuit found that the statute was enacted "as a device to streamline the more awkward prior practice of bringing suit on a foreign judgment and thereby obtaining a new judgment on the foreign judgment." Thus, the Fourth Circuit held that § 1963 allows the holder of a Virginia judgment "simply to register the Virginia judgment in Maryland but to retain the benefits of obtaining a judgment under the former practice." Moreover, the Fourth Circuit found the explicit statutory language of § 1963, which states that a district court judgment registered in another district court "shall have the same effect as a judgment of the district court . . . and may be enforced in like manner," supported this conclusion.

Therefore, the Fourth Circuit construed § 1963 to provide for a new judgment in the district court where the judgment was registered. The Fourth Circuit further explained that with the registered judgment functioning as a new judgment, the limitation period for enforcement runs from the date of registration. The Fourth Circuit found that other circuits, such as the Fifth, Eighth, and Ninth Circuits, had reached the same conclusion. See, e.g., Home Port Rentals, 252 F.3d at 405; Stanford, 341 F.2d at 268; In re Estate of Ferdinand E. Marcos Human Rights Litig., 536 F.3d 980, 989 (9th Cir. 2008).

Thus, the Fourth Circuit held the registered judgment would have expired on August 27, 2015 - 12 years from the date of registration August 27, 2003. As Wells Fargo renewed the judgment for another 12 years on August 26, 2015, the registered judgment is enforceable in Maryland until August 26, 2027.

To read the full opinion, click here.

Panel: Circuit Judges Niemeyer and Diaz, and District Judge Keeley

Argument Date: 09/20/2016

Date of Issued Opinion:
11/04/2016

Docket Number: No. 15-2182

Decided: Affirmed by published opinion.

Case Alert Author: Maria Nazarova, Univ. of Maryland Carey School of Law

Counsel: ARGUED: David B. Lamb, Washington, D.C., for Appellant. Steven Neal Leitess, LEITESS FRIEDBERG PC, Baltimore, Maryland, for Appellee. ON BRIEF: David A. Donohoe, Potomac, Maryland, for Appellant. Gordon S. Young, Pierce C. Murphy, LEITESS FRIEDBERG PC, Baltimore, Maryland, for Appellee.

Author of Opinion: Circuit Judge Niemeyer

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 12/07/2016 09:27 AM     4th Circuit     Comments (0)  

December 6, 2016
  United States of America v. Gilliam
Headline: Second Circuit Affirms That in "Exigent Circumstances," GPS Information Information Can Be Obtained and Used Without a Warrant to Locate a Suspect

Area of Law: Criminal Procedure

Issue Presented: Whether, in exigent circumstances, information from a global positioning system in a phone can be obtained and used without a warrant to locate a suspect.

Brief Summary: Jabar Gilliam appealed from a judgment of the United States District Court for the Southern District of New York, convicting him after a jury trial of offenses concerning sex trafficking of a minor and sentencing him to 240 months of imprisonment. Gilliam had been employing a minor to work for him as a prostitute in Maryland, and then brought her to the Bronx for her to continue working as a prostitute there. The authorities were informed that she was missing from home and eventually discovered Gilliam's identity. They believed and had testimony indicating that he had taken her with the intention to force her into prostitution. Authorities then contacted Sprint Corporation ("Sprint"), a telecommunications company and requested Global Positioning System ("GPS") location information for Gilliam's cellphone, stating that the request was due to an exigent situation involving immediate danger of death or serious bodily injury to a person. Sprint complied with this request and Gilliam was found, arrested and convicted. Gilliam's primary contention in this appeal was that the district court had erred in denying his motion to suppress his cell phone's location information. The Second Circuit held that the District court did not err, based on both statutory and constitutional interpretation. The first statutory question was whether the language "other information" in 18 U.S.C. § 2702(c)(4), allowed for the disclosure of GPS location information. The court held in the affirmative. The second statutory question and the constitutional question hinged on whether the circumstances presented to Sprint could qualify as an exigent circumstance that would permit a warrantless search. Again, the Second Circuit held in the affirmative and finding that exigent circumstances were demonstrated because the evidence available to law enforcement at the time of the search for Gilliam's location was compelling and involved danger of serious physical injury to the minor. Thus, the Second Circuit affirmed the judgment of the District Court.

Extended Summary: Jabar Gilliam appeals from a January 28, 2015, judgment of the District Court for the Southern District of New York, convicting him after a jury trial of offenses concerning sex trafficking of a minor and sentencing him to 240 months of imprisonment.

Gilliam met the minor, a girl known as Jasmin in Maryland in late October or early November 2011. She was sixteen at the time, but told Gilliam that she was seventeen. Gilliam asked Jasmin to work for him as a prostitute after she told him she was working for another pimp. Gilliam told Jasmin that he was going to take her to New York, where she could work for him.

Jasmin worked for Gilliam as a prostitute in Maryland in November 2011. On November 30, Gilliam brought Jasmin to New York City after threatening to require her fifteen-year-old sister to work as a prostitute for him if Jasmin refused to go. Gilliam purchased Jasmin's bus ticket for the trip, and on the ride to New York City, Gilliam told Jasmin to sit near the window and then made sure she couldn't get out of her seat by putting his legs up beside her. Jasmin worked as a prostitute for Gilliam in the Bronx, giving him all the money that she earned.

On November 30, Jasmin's foster mother reported to the Sheriff's Office in Frederick County, Maryland, that Jasmin was missing from home. The foster mother told authorities that Jasmin had mentioned a "boyfriend," who was known to her as "Jabar," and who was later identified as Gilliam. On December 2, the case was referred to the Maryland State Police, and Corporal Chris Heid was assigned to investigate.

Corporal Heid spoke with Jasmin's social worker, who expressed concern that Jasmin was being forced into prostitution by Jabar Gilliam. This concern was based of conversations with Jasmin's biological mother. Heid then spoke to Jasmin's biological mother, who affirmed this information and stated that Gilliam had communicated with her directly and told her that he was planning to take Jasmin to New York so that she could work there as a prostitute.

After this conversation and based on the information he had received, Heid contacted Sprint and told Sprint that he was "investigating a missing child who is . . . being prostituted," and requested GPS location information for Gilliam's cell phone. Heid said that he was making the request because of "an exigent situation involving . . . immediate danger of death or serious bodily injury to a [] person." Sprint complied with Heid's request and began providing real-time GPS location information to the Maryland State Police, which passed the information on to the FBI and the New York City Police Department ("NYPD)."

On December 2, Jasmin placed a phone call to her biological mother from the Bronx apartment of Gilliam's mother. NYPD officers were dispatched to that apartment and questioned Gilliam's mother. After which location information provided by Sprint indicated that Gilliam's cell phone was a few blocks away. NYPD officers subsequently canvassed the neighborhood and saw Gilliam and Jasmin on the street. The officers then confronted Gilliam, he attempted to flee, and was arrested. Gilliam was charged in Count One with sex trafficking of a minor by force, fraud, or coercion in violation of 18 U.S.C. §§ 1591(a), (b)(1), and (b)(2), and in Count Two with transporting a minor in interstate commerce for purposes of prostitution in violation of 18 U.S.C. § 2423(a). Gilliam was convicted on both counts after a jury trial and by judgment, dated January 28, 2015, sentenced to imprisonment for 240 months.

Gilliam appealed the judgment. Gilliam's primary contention in this appeal was that the District Court had erred in denying his motion to suppress his cell phone's location information, which had been supplied, at the Government's request, by a Sprint. The Second Circuit held that the District court did not err.

In coming to this decision the Second Circuit focused on two statutory questions and a constitutional question. The first question was whether the language "other information" in 18 U.S.C. § 2702(c)(4), allowed for the disclosure of GPS location information. The section states that: A provider . . . may divulge a record or other information pertaining to a subscriber . . . (not including the contents of communications covered by [other subsections]) - . . .
(4) to a governmental entity, if the provider, in good faith, believes that an emergency involving danger of death or serious physical injury to any person requires disclosure without delay of information relating to the emergency.
In determining whether "other information" included GPS location information the Second Circuit looked at the legislative history of 18 U.S.C. § 2702(c)(4) and persuasive authority from district courts. The legislative history of the subsection states that Congress intended "other information" to cover "information about the customer's use of the service." Additionally, district courts under 18 U.S.C. § 2703, a statute different from, albeit, similarly written and closely related to, section 2702, had found that "other information" did include GPS location information. Thus, the Second Circuit similarly held that "other information" did include GPS information from a phone.

The second question was whether the circumstances presented to Sprint showed "an emergency involving danger of . . . serious physical injury to any person." This question also tied into a constitutional question, concerning whether Gilliam's Forth Amendment rights were violated by Sprint's disclosure at the request of a law enforcement officer and the use of that information to locate and arrest Gilliam without a warrant. Both the second statutory question and the Fourth Amendment issue turned on whether the circumstances known to law enforcement and presented to Sprint were within the category of "exigent circumstances" that permit warrantless searches. The Second Circuit found that the District Court did not err in finding that exigent circumstances did exist because the evidence available to law enforcement at the time of the search for Gilliam's location was compelling. They based this on Heid's discussions with Jasmin's foster mother, social worker, and biological mother, which demonstrated that law enforcement had a substantial basis to believe that Gilliam was bringing Jasmin to New York City to require her to work there as a prostitute. This kind of sexual exploitation of a minor has often been found to pose a significant risk of serious bodily injury and thus could be seen as an exigent circumstance.

To read the full decision, please visit:
http://www.ca2.uscourts.gov/de...9a50e0d4b122/2/hilite/ (could not get hyperlink to work for me)

Panel: Circuit Judges Newman, Winter, Cabranes

Argument Date: 9/29/2016

Date of Issued Opinion: 12/1/2016

Docket Numbers: 15-387

Decided: Affirmed.

Case Alert Author: Brian Bendy

Counsel: Robert A. Culp, Law Office of Robert A. Culp, Garrison, NY, for Appellant; Kristy J. Greenberg, Asst. U.S. Atty., New York, NY (Preet Bharara, U.S. Atty., Adam S. Hickey, Asst. U.S. Atty., New York, NY, on the brief), for Appellee.

Author of Opinion: Judge Newman

Circuit: Second Circuit

Case Alert Circuit Supervisor: Emily Gold Waldman

    Posted By: Emily Waldman @ 12/06/2016 08:26 AM     2nd Circuit     Comments (0)  

November 22, 2016
  Fraternal Order of Police, Lodge 1 v. City of Camden - Third Circuit
Headline: "Directed patrols" that required police officers to engage with community members did not violate New Jersey Anti-Quota law, prohibiting quotas for arrests and citations; 1st Amendment did not protect officers' objections to the patrol policy; officers are entitled to trial on their retaliation claims under New Jersey state law.

Area of Law: Evidence, Qualified Immunity, NJ Anti-Quota Law, Conscientious Employee Protection Act, First Amendment, Family and Medical Leave Act

Issues Presented: Does a city's "directed patrols" policy implemented by its police department constitute an illegal quota system in violation of New Jersey's anti-quota law? When does a city's conduct amount to illegal retaliation in violation of New Jersey's Conscientious Employee Protection Act, the First Amendment, and the Family and Medical Leave Act?

Brief Summary: In April 2009, the Fraternal Order of Police filed a complaint against the City of Camden Police Department and the Attorney General of New Jersey ("Defendants"), claiming Camden had imposed an unlawful quota policy by requiring the officers to perform "directed patrols," which required them to engage with community members. The individual plaintiff Officers also accused Defendants of illegal retaliation in violation of NJ's Conscientious Employee Protection Act ("CEPA"), the First Amendment, and the Family and Medical Leave Act ("FMLA"). The Third Circuit concluded that NJ's anti-quota statute is inapplicable to the patrols policy and thus could not support Plaintiffs' allegations of a quota. It affirmed summary judgment on the First Amendment claims because the plaintiffs were speaking as employees, not citizens. But the Court reversed summary judgment on plaintiffs' retaliation claims under the New Jersey Conscientious Employee Protection Act, holding that plaintiffs' reasonable belief that the policy was illegal, the evidence of adverse actions taken against them, and evidence of a causal connection showed material facts in dispute. Plaintiffs were entitled to rely on hearsay evidence to oppose summary judgment because the evidence was capable of being admissible at trial.

Extended Summary: This case arises from a dispute between the Fraternal Order of Police, Lodge 1 as well as certain police officers ("Plaintiffs") on one side, and the City of Camden, NJ and certain supervisory police personnel ("Defendants") on the other. In 2008, Camden implemented a policy known as "directed patrols" requiring police officers to engage with city residents even though the residents are not suspected of any wrongdoing. The announced purpose of the program was to obtain information about the community while making the police presence more visible. In April 2009, Fraternal Order of Police, Lodge 1 filed a complaint against the Camden Police Department and the NJ Attorney General, claiming that the directed controls policy constituted an illegal quota system in violation of NJ's anti-quota law. The individual plaintiff Officers further alleged that Defendants violated NJ's Conscientious Employee Protection Act ("CEPA"), the First Amendment and the Family Medical Leave Act ("FMLA") by retaliating against them because they expressed their disagreement with the policy. The district court granted summary judgment to Defendants on all of Plaintiffs' claims.

On appeal, Plaintiffs contended that the district court erred in dismissing their claims under (1) New Jersey's anti-quota law; (2) CEPA; (3) the First Amendment; and (4) FMLA. In addition, they asserted that the district court erred when it ignored hearsay evidence and concluded that Defendants were entitled to judgment as a matter of law. The Third Circuit discussed each claim of error in turn.

First, the Third Circuit discussed the district court's concern over statements by the individual plaintiffs about statements other officers purportedly made concerning the alleged retaliation and the nature of the patrols constituted hearsay. According to the Third Circuit, this evidence was hearsay, but the court erred in refusing to consider it at the summary judgment stage. The Third Circuit explained "the rule in this circuit is that hearsay statements can be considered on a motion for summary judgment if they are capable of being admissible at trial." Thus, in ruling on Defendants' motion for summary judgment, the district court should have limited its inquiry to determining if the out-of- court statements Plaintiffs were relying on were admissible at trial, "and they clearly were." Accordingly, The Third Circuit reversed the district court's exclusion of hearsay in determining if the record allowed Plaintiffs to survive a motion for summary judgment.

Second, the Third Circuit discussed Plaintiffs assertion that Camden's patrols policy violates NJ's anti-quota statute even though the statute's text only addresses arrests and citations. The Third Circuit found that the district court correctly relied on the limited scope of the statute's text - which does apply only to arrests and citations, and not to the civilian "encounters" that are at the center of this dispute. Accordingly, the Third Circuit affirmed the court's grant of summary judgment in favor of Camden on Plaintiffs' claims under the anti-quota law.

Third, the Third Circuit discussed CEPA, which protects employees against retaliation by employers for whistleblowing activities. The Court made clear that NJ courts have created a four-pronged test for adjudicating CEPA claims that largely replicates the three- part burden-shifting test that is used to decide federal retaliation claims. To establish a CEPA violation, a plaintiff must prove that: (1) she reasonably believed her employer was violating a law or rule; (2) she performed a protected whistleblowing activity; (3) an adverse employment action was taken against her; and (4) there is a causal connection between the whistleblowing activity and the adverse action. According to the Third Circuit, Plaintiffs satisfied each prong, and summary judgment was therefore inappropriate. Accordingly, the Third Circuit reversed the district court's dismissal of the plaintiff-officers' retaliatory transfer claims under CEPA.

Fourth, the Third Circuit addressed plaintiff-officers claim that Defendants violated their First Amendment rights by retaliating against them for objecting to the patrols policy. According to the Third Circuit, a public employee's statement is protected by the First Amendment when "(1) in making it, the employee spoke as a citizen, (2) the statement involved a matter of public concern, and (3) the government employer did not have 'an adequate justification for treating the employee differently from any other member of the general public' as a result of the statement he made." While the Third Circuit noted that the plaintiff-officers provided compelling arguments to support their claim that their speech involved a matter of public concern, it agreed with the district court that their First Amendment claims could not proceed. The Court explained, the First Amendment "provides robust protection to statements pertaining to matters of public concern," but it does not "empower public employees to constitutionalize the employee grievance when they are acting in their official capacities."' Accordingly, the Third Circuit affirmed the dismissal of the plaintiff-officers' First Amendment claims.

Fifth, the Third Circuit discussed the FMLA, which affords eligible employees leave to tend to a serious health condition, and to care for a family member with a serious health condition. A claim that these rights have been breached is referred to as "interference." Officer Holland alleged that Camden interfered with his protected FMLA leave, while Camden contended that any "interference" was in part an internal miscommunication. The Third Circuit found that without more, Camden's conduct was not actionable under FMLA. Accordingly, because FMLA "provides no relief unless the employee has been prejudiced by the violation," the district court was correct in granting summary judgment against Officer Holland.

Finally, the Third Circuit discussed qualified immunity, since in addition to suing the City of Camden, Plaintiffs also sued several officers in their individual capacities. Those officers objected to the suits on the ground that they are protected by qualified immunity. In assessing the qualified immunity claims, the Third Circuit conducted its two-part inquiry by first, determining whether the facts demonstrate the violation of a right; and second, deciding if the right at issue was clearly established at the time of the alleged misconduct. Ultimately, the Third Circuit agreed with the district court that qualified immunity depends, in part, on whether a legal violation occurred, and since Plaintiffs did not show a violation of federal law, it did not need to reach the issue of qualified immunity.

Overall, the Third Circuit reversed the district court's order granting summary judgment to Defendants on Plaintiffs' CEPA claims, and remanded for proceedings consistent with this opinion. In addition, the Third Circuit affirmed the district court's dismissal of Plaintiffs' New Jersey Anti-Quota law, First Amendment claims, and Officer Holland's FMLA claim.

The full opinion can be found at http://www2.ca3.uscourts.gov/opinarch/151963p.pdf

Panel: McKee, Ambro, and Scirica Circuit Judges

Argument Date: January 12, 2016

Date of Issued Opinion: November 17, 2016

Docket Number: No. 15-1963

Decided: Reversed and remanded

Case Alert Author: Brooke Hutchins

Counsel: Gregg L. Zeff, Esq., Counsel for Appellants; John C. Eastlack, Jr., Esq., Daniel E. Rybeck, Esq., Counsel for Appellees

Author of Opinion: Circuit Judge McKee

Circuit: Third Circuit

Case Alert Circuit Supervisor: Prof. Susan L. DeJarnatt

    Posted By: Susan DeJarnatt @ 11/22/2016 03:00 PM     3rd Circuit     Comments (0)  

November 21, 2016
  Delaware Trust Co. v. Energy Future Intermediate Holding Co. - Third Circuit
Headline: Third Circuit holds that the redemption premium in a loan indenture is not cancelled by acceleration due to the borrower's voluntary bankruptcy filing, undertaken in order to refinance the indenture at a lower rate.

Area of Law: Bankruptcy

Issues Presented: What happens when one provision of an indenture for money loaned provides that the debt is accelerated if the debtor files for bankruptcy and while in bankruptcy it opts to redeem that debt, while another indenture provision provides for a redemption premium?

Brief Summary: The Energy Future Intermediate Holding Company LLC and EFIH Finance Inc. (collectively, "EFIH") redeemed Notes after their maturity had accelerated due to EFIH's voluntary bankruptcy filing. It did not pay the redemption premium called for in the Notes. The Third Circuit reversed the courts below which had held that the acceleration due to the bankruptcy cancelled the obligation to pay the redemption premium. The Third Circuit made clear that its "primary objective . . . is to give effect to the intent of the parties as revealed by the language of their agreement." Accordingly, it found that the language of the First Lien Indenture required EFIH to pay a make-whole if it redeemed the First Lien Notes at its option before December 1, 2015, and the Second Lien Indenture required the same for redemptions of Second Lien Notes before May 15, 2016 or March 1, 2017. EFIH redeemed the First Lien Notes at its option on June 19, 2014 and redeemed a portion of the Second Lien Notes on March 10, 2015. Thus, the Third Circuit held that EFIH must pay the make-whole per the indenture language.

Extended Summary: First and Second Lien Trustees brought appeals on behalf of their respective Noteholders, which the Third Circuit consolidated. They argued that the Bankruptcy Court and District Court for the District of Delaware erred by holding that Indentures did not require payment of the make-whole when the Energy Future Intermediate Holding Company LLC and EFIH Finance Inc. (collectively, "EFIH") redeemed the Notes after their maturity had accelerated due to EFIH's voluntary filing for bankruptcy. The issue presented to the Third Circuit was what happens when one provision of an indenture for money loaned provides that the debt is accelerated if the debtor files for bankruptcy and while in bankruptcy it opts to redeem that debt, and another indenture provision provides for a redemption premium.

Section 3.07, titled "Optional Redemption," stated when the make-whole is due: "At any time prior to December 1, 2015, the Issuer may redeem all or a part of the Notes at a redemption price equal to 100% of the principal amount of the Notes redeemed plus the Applicable Premium [i.e., the make-whole] . . . and accrued and unpaid interest." Section 6.02 provided that on the filing of a bankruptcy petition by EFIH "all outstanding Notes shall be due and payable immediately without further action or notice."

The Third Circuit began by discussing the First Lien Indenture. It stated that any duty to pay the make-whole came from § 3.07. Next, the Court next explored whether there was a redemption, if the redemption was optional, and if it occurred before December 1, 2015. Since § 3.07 did not define "redemption," the Court looked to New York and federal courts, which deemed "redemption" to include both pre- and post- maturity repayments of debt. Accordingly, the Court held that EFIH's June 19, 2014 refinancing was a "redemption" within the meaning of § 3.07. The Court then explained that EFIH's contention that any redemption was mandatory rather than optional did not match the facts. Instead, events leading up to the post-petition financing on June 19, 2014 demonstrated that the redemption was at EFIH's option under § 3.07. Finally, the Court explained that since these occurred before December 1, 2015, § 3.07 required that EFIH pay the Noteholders the yield-protection payment.

Second, the Third Circuit found that any conflict between §§ 3.07 and 6.02 was illusory: "We know no reason why we should choose between §§ 3.07 and 6.02 when both plainly apply." According to the Court, § 3.07 governs the optional redemption embedded in the refinancing and requires payment of the make-whole, while § 6.02 is silent. Thus, "it surpasses strange to hold that silence in § 6.02 supersedes § 3.07's simple script."

Third, the Third Circuit discussed the Second Lien Indenture's additional language, not present in the First Lien Indenture. According to the Court, these additions made explicit the link between acceleration under §6.02 and the make-whole for an optional redemption per § 3.07. Unlike the First Lien Indenture, where these concepts are without cross- reference and separate, in the Second Lien Indenture they are tied together: "Sections 3.07 and 6.02 are not merely compatible but complementary." Even still, the Court made clear that the result is the same no matter the Indenture - there were optional redemptions before a date certain, thereby triggering make-whole premiums.

When EFIH filed its bankruptcy petition, Second Lien Indenture § 6.02 caused "all principal of and premium, if any, interest . . . [,] and any other monetary obligations on the outstanding [Second Lien] Notes [to] be[come] due and payable immediately." The words "premium, if any," are most naturally read to reference §3.07's "Applicable Premium" - that is, the make-whole. By including the words "premium, if any," in its acceleration provision, the Second Lien Indenture left no doubt that §§3.07 and 6.02 work together. Thus, both remained applicable following bankruptcy, and, pursuant to the agreement struck with the Second Lien Noteholders, they were entitled to the make-whole.

Fourth, the Third Circuit discussed the effect of acceleration on make-whole provisions. The Court adopted the New York Court of Appeals' holding that contract terms like § 3.07 that are applicable before acceleration remain so afterward. Put differently, § 3.07 applies no less following acceleration of the Notes' maturity than it would to a pre-acceleration redemption. The Third Circuit explained that if parties want a "prepayment" premium to survive acceleration and maturity, they must clearly state it. Accordingly, the Court found nothing in § 6.02 negates the premium § 3.07 requires if an optional redemption occurs before a stated date. Thus, acceleration here had no bearing on whether and when the make-whole is due.

The Court subsequently emphasized that it must give effect to the "words and phrases" the parties chose. It explained that by avoiding the word "prepayment" and using the term "redemption," here, the parties decided that the make-whole would apply without regard to the Notes' maturity. Still, however, the Court found that if EFIH wanted its duty to pay the make-whole on optional redemption to terminate on acceleration of its debt, it needed to make clear that § 6.02 trumps § 3.07. The burden to make that showing was with EFIH. "To place it on the Noteholders for EFIH's decision to redeem the Notes, [would be] a bridge too far."

The Third Circuit concluded by reiterating its primary objective, "to give effect to the intent of the parties as revealed by the language of their agreement." It restated that the language of the First Lien Indenture required EFIH to pay a make-whole if it redeemed the First Lien Notes at its option before December 1, 2015, and the Second Lien Indenture requires the same for redemptions of Second Lien Notes before May 15, 2016 or March 1, 2017. EFIH redeemed the First Lien Notes at its option on June 19, 2014 and redeemed a portion of the Second Lien Notes on March 10, 2015 - before the respective dates noted. Thus, in accordance with statements of New York law by its highest Court and the federal Circuit Court in New York, the Third Circuit held that EFIH must pay the make-whole. The Court reversed the District Court's judgment with instructions to remand to the Bankruptcy Court for further proceedings consistent with this opinion.

The full opinion can be found at http://www2.ca3.uscourts.gov/opinarch/161351p.pdf

Panel: Ambro, Smith, and Fisher, Circuit Judges

Argument Date: September 27, 2016

Date of Issued Opinion: November 17, 2016

Docket Number: Nos. 16-1351, 16-1926, 16-1927 & 16-1928

Decided: Reversed and remanded

Case Alert Author: Brooke Hutchins

Counsel: Philip D. Anker, Esq. [Argued], Danielle Spinelli, Esq., Joel Millar, David Gringer, Isley Gostin, James H. Millar, Esq., Todd C. Shiltz, Esq., Norman L. Pernick, Esq., Counsel for Appellant DE Trust Co; Daniel J. DeFranceschi, Esq., Jason M. Madron, Esq., Mark D. Collins, Esq., Andrew R. McGaan, Esq. [Argued], James H.M. Sprayregen, Esq., Marc Kieselstein, Esq., Chad J. Husnick, Esq., Steven N. Serajeddini, Esq., Edward O. Sassower, Esq., Michael A. Petrino, Esq., Counsel for Appellees EFIH; Joshua K. Brody, Esq., Gregory A. Horowitz, Esq. [Argued], Thomas M. Mayer, Esq., Jeffrey S. Trachtman, Esq., Laura D. Jones, Esq., James E. O'Neill, III, Esq., Robert J. Feinstein, Esq., Stephanie Wickouski, Esq., Counsel for Appellant Computershare Trust Co.

Author of Opinion: Circuit Judge Ambro

Circuit: Third Circuit

Case Alert Circuit Supervisor: Prof. Susan L. DeJarnatt

    Posted By: Susan DeJarnatt @ 11/21/2016 01:35 PM     3rd Circuit     Comments (0)  

November 18, 2016
  Carlton Baptiste v. Attorney General United States of America - Third Circuit
Headline: 18 U.S.C. §16(b) is void as unconstitutionally vague under the Due Process Clause of the Fifth Amendment due to its failure to clearly define "crime of violence"

Area of Law: Due Process Clause of Fifth Amendment, Statutory Interpretation

Issue(s) Presented: Does the definition of a "crime of violence" provided in 18 U.S.C. §16(b) render the statute void for vagueness under the Due Process Clause of the Fifth Amendment?

Brief Summary: The Third Circuit reviewed petitioner Carlton Baptiste's order to be removed as an alien issued by the Board of Immigration Appeals due to a conviction defined as a "crime of violence" and at least two convictions for crimes involving moral turpitude, or an extreme indifference to the value of human life. Baptiste, a native of Trinidad and Tobago, was convicted in 2009 for an aggravated felony, which is defined as a "crime of violence" pursuant to 18 U.S.C. §16(b). According to federal statute, aliens who are convicted of aggravated felonies after admission to the United States are removable.
Mirroring a recent decision by the Supreme Court which held that the definition of "violent felony" was unconstitutionally vague, the Third Circuit similarly held in the case at bar that the definition of a "crime of violence" in 18 U.S.C. §16(b) was unconstitutionally vague under the Due Process Clause of the 5th Amendment. Using the categorical approach of first defining "crime of violence" and then comparing the definition to the conviction statute of an aggravated felony, the Third Circuit did not find the definitions of "ordinary case" or "substantial risk" required to establish a crime of violence under §16(b) to be clear and give "fair notice of the conduct it punishes." Therefore, the Third Circuit found §16(b) to be subject to arbitrary enforcement and rendered it void.
However, the Third Circuit affirmed that Baptiste was still subject to removal due to his multiple convictions involving crimes of moral turpitude.

Extended Summary: Carlton Baptiste, a native of Trinidad and Tobago, sought review of a decision by the Board of Immigration Appeals ordering his removal as an alien due to his convictions of an aggravated felony and at least two convictions involving moral turpitude. In 2009, Baptiste was convicted of second-degree aggravated assault pursuant to New Jersey law. The Department of Homeland Security began removal proceedings against Baptiste in 2013 due to the classification of his 2009 conviction as a "crime of violence" pursuant to 18 U.S.C. §16 and therefore, was convicted of an aggravated felony pursuant to 8 U.S.C. §1227(a)(2)(A)(ii).
According to federal law, an alien who is convicted of an aggravated felony after admission to the United States is removable. 18 U.S.C. §16 defines an aggravated felony as a "crime of violence" imposing a prison sentence of at least one year. The Third Circuit used the categorical approach to determine if Baptiste's 2009 conviction was indeed an aggravated felony. To employ the categorical approach, the Third Circuit first examined the definition of a "crime of violence" and then compared that definition to the statute of conviction to determine if "aggravated felony" as defined in the statute of conviction was categorically a crime of violence.
The Third Circuit noted that 18 U.S.C. §16(b) defines a "crime of violence" as a "felony and that, by its nature, involves a substantial risk that physical force against the person or property of another may be used in the course of committing the offense." Further, the categorical approach required the Third Circuit to apply the definition of a crime of violence to the statute of conviction, which stated that an aggravated assault occurs if the perpetrator "attempts to cause serious bodily injury to another, or causes such injury purposely or knowingly or under circumstances manifesting extreme indifference to the value of human life recklessly causes such injury." Therefore, the Third Circuit inquired whether recklessly causing serious bodily injury to another was categorically a crime of violence under §16(b).
The Third Circuit adopted the "ordinary case inquiry" to determine if a crime presents a "substantial risk" of the use of force, thus categorizing it as a crime of violence under §16(b). To define the "ordinary case" of reckless second-degree assault, the Third Circuit evaluated the conduct that is usually or normally used in the commission of the crime. However, the Third Circuit concluded that a variety of conduct can usually or normally be employed to commit reckless second-degree assault, noting specifically conduct that (1) "constitutes an intentional use of force;" (2) "presents a substantial risk of the intentional use of force; and" (3) presents no risk of the intentional use of force."
The Third Circuit contended that only judicial experience and "common sense" led it to the definition of the "ordinary case" of reckless second-degree assault to be conduct that "presents a substantial risk of the intentional use of force" and thus, categorically a crime of violence under §16(b). Because this reasoning invited arbitrary evaluation of the "ordinary case" of the commission of the crime, the Third Circuit determined that the definition of "ordinary case" was vague. Also, the Third Circuit noted that §16(b) provided no example offenses of a crime of violence and thus, failed to provide any guidance to the courts. Because the "ordinary case" and "substantial risk" analysis required by §16(b) were unconstitutionally vague, as it did not provide "fair notice of the conduct it punishes" required by the Due Process Clause of the Fifth Amendment, the Third Circuit invalidated the statute. Therefore, the invalidation of §16(b) rendered Baptiste's 2009 conviction of an aggravated felony void, as it could not be categorically defined as a crime of violence.
Regardless, the Third Circuit found that Baptiste was still removable as he was convicted of at least two crimes, his 2009 conviction and a conviction in 1978 for assault and battery, involving moral turpitude. Ultimately, the Third Circuit remanded Baptiste's petition to the Board of Immigration Appeals to determine if he was eligible for relief from removal due to his 2009 conviction no longer being categorized as an aggravated felony.

The full opinion can be found at http://www2.ca3.uscourts.gov/opinarch/144476p.pdf

Panel: Greenaway, Jr., Scirica, and Rendell, Circuit Judges

Argument Date: April 5, 2016

Date of Issued Opinion: November 8, 2016

Docket Number: No. 14-4476

Decided: Granted in part, denied in part, remanded in part

Case Alert Author: Katherine A. Osevala

Counsel: Michael L. Foreman and Penelope A. Scudder, counsel for Petitioner; Jennifer J. Keeney, Jesse M. Bless, Anthony C. Payne and Colette J. Winston, counsel for Respondent.

Author of Opinion: Circuit Judge Greenaway, Jr.

Circuit: Third Circuit

Case Alert Circuit Supervisor: Prof. Susan L. DeJarnatt

    Posted By: Susan DeJarnatt @ 11/18/2016 01:15 PM     3rd Circuit     Comments (0)  

November 17, 2016
  Sharif v. United Airlines, Inc. and United Continental Holdings, Inc.
FMLA Leave Fraud Does Not Pay for Globetrotting United Airlines Worker

Areas of Law: Labor and Employment, Family and Medical Leave Act (FMLA)

Issue Presented: Whether an employee, who fraudulently took FMLA leave, has sufficient evidence to show that the employer's reasons for disciplining him were pre-textual and the true reason for the discipline was retaliatory.

Brief Summary:
Masoud Sharif took FMLA leave in the middle of an extensive trip to South Africa. His employer, United Airlines, investigated him and found that he had taken the leave fraudulently. When questioned about the leave, Mr. Sharif presented inconsistent narratives. United placed him on leave without pay for dishonesty and fraudulently taking leave. Mr. Sharif retired and sued United for retaliation under the FMLA. The United States Court of Appeals for the Fourth Circuit upheld a grant of summary judgment for United. The court held that Mr. Sharif did not have sufficient evidence to show that United's reasons for disciplining him were a pretext for retaliation. It further admonished that those who fraudulently take FMLA leave cannot take advantage of FMLA's protective provisions.

Extended Summary: On March 16th 2015, Masoud Sharif and his wife embarked on an extended vacation in South Africa. The two took approximately twenty days of leave from their employer, United Airlines. There was just one bump in the plan. Mr. Sharif could not get a co-worker to cover his March 30th shift. Nonetheless, the couple departed for South Africa without reserving return flights.

On March 30th at 7:00 a.m. Cape Town time, Mr. Sharif called United Airlines and left a message informing his employer that he would be taking medical leave under the Family Medical Leave Act (FMLA). Mr. Sharif suffers from panic attacks and was entitled to intermittent leave under the FMLA.

On March 31st, the Sharifs had still not made any reservations to return to Washington. Instead, they flew to Milan to visit Mr. Sharif's niece. Finally, on April 3rd, the Sharifs returned to Washington in time for Mrs. Sharif's next shift.

The United Airlines Employee Resource Center noted that Mr. Sharif had taken just one day of FMLA leave during his long vacation. When they discovered that he had done the same in September 2013, they informed a supervisor, who commenced an investigation. In the course of the investigation, Mr. Sharif was given the opportunity to explain himself to supervisors with a union representative present. Mr. Sharif first said that he was not scheduled to work that day. Then, he said that he did not remember calling out. Finally, he claimed he had started looking for a flight home on March 28th so that he could return for his shift and celebrate Persian New Year in Pittsburgh. He told the investigators that when he could not find a flight back to Washington for his shift he had a panic attack and called United to take leave under the FMLA.

United did not find Mr. Sharif's shifting narrative compelling and suspended him without pay for dishonesty and fraudulently taking FMLA leave - violations of the United Airlines Working Together Guidelines. United made it clear that Mr. Sharif would soon be terminated. The Union suggested that Mr. Sharif retire. Fearing termination, Mr. Sharif retired.

Mr. Sharif filed suit under 29 U.S.C § 2615 (a)(1), which makes it unlawful for an employer to "interfere with, restrain, or deny the exercise or attempt to exercise, any right guaranteed under the" FMLA. United Airlines moved for summary judgment, which the District Court granted. On appeal, Mr. Sharif sought to show he had sufficient evidence that the reasons given for his suspension were pre-textual and that United had actually disciplined him for taking FMLA leave.

The Fourth Circuit explained that the purpose of the FMLA is to provide job security to individuals with serious health conditions who need to take extensive leave. These individuals must provide documentation of their condition to the employer and then may take leave "when medically necessary." The provision of the FMLA under which Mr. Sharif sued bolsters the Act's purpose by preventing retaliation.

In order to prove an employer's action was retaliatory, the employee must show that 1) he engaged in a protected activity; 2) the employer took an adverse action against him; and 3) a causal connection between the protected activity and the adverse action exists. To do this, the employee may submit direct evidence of retaliation or utilize the McDonnell Douglas burden-shifting scheme. Under McDonnell Douglas, if the employee makes a prima facie showing of retaliation, the employer must show a nondiscriminatory reason for the adverse action. Then the employee may show that this reason is pre-textual by showing that a) the reason is not credible; or b) the decision was more likely than not retaliatory.

Mr. Sharif mounted a series of attacks attempting to show United's reasons for disciplining him were pretext. The Fourth Circuit rejected all of these.

First, Mr. Sharif attempted to rehabilitate his own narrative. He claimed he had a panic attack after not being able to find a flight home in time for his shift and then called out of work. He also explained that he gave inconsistent accounts in the interview because he had another panic attack during the interview. The court did not find this explanation convincing in light of other facts. First, Mr. Sharif had called to take the FMLA leave twelve hours after the last flight that would have returned him to Washington in time for his shift. Second, the Sharifs flew to Milan from Cape Town and then returned to Washington in time for the wife's shift. Third, his narrative of these events constantly shifted. Finally, Mr. Sharif was unable to provide receipts for the standby seats he claimed he purchased when asked by United. Based on this information, the court found it reasonable for United Airlines to conclude that Mr. Sharif simply did not want to return from his vacation. The court also recounted United Airlines' history with FMLA leave. It found that United had approved every FMLA leave request Mr. Sharif had submitted over two years - a total of fifty-six days. The court concluded that "this is not the record of a Company that is historically hostile to FMLA leave."

Second, Mr. Sharif claimed that the Employee Resources Center's notice to a supervisor that triggered the investigation was direct evidence of retaliation. But, the notice was purely factual. It stated that Mr. Sharif had taken FMLA leave during vacation and that he had done so before in 2013. Mr. Sharif argued that it showed he would not have been disciplined but for his taking of FMLA leave. The court disagreed and determined that the notice actually suggested a nondiscriminatory reason for United's actions.

Mr. Sharif next argued that United had only conducted a cursory investigation and had not complied with procedure. He said this showed pretext. Contrarily, the court explained, United had taken the appropriate steps in its investigation and had even given Mr. Sharif the opportunity to explain himself and provide proof of his version of the events. United had reviewed Mr. Sharif's work calendar, flight records, Mr. Sharif's phone call from South Africa, and Mr. Sharif's seat reservation history. But, Mr. Sharif stated that more was required - verification of his anxiety disorder, an independent check of seats on flights, and more opportunity to consult with the union. The court found United's actions sufficient. All that is required on the part of the employer is a "reasonably informed and considered decision." Mere failure to comply with procedure is insufficient to show pretext.

Finally, Mr. Sharif claimed that if he had skipped the shift rather than taking FMLA leave, he would not have received such sever discipline. So, the severity of the consequence for taking FMLA leave showed pretext. The court stated that addressing severity would make it a "super-personnel department." The consequences, however, seemed reasonable for fraud and dishonesty.

The court admonished that the FMLA serves the purpose of protecting employees who need intermittent leave. Thus, it cannot be fraudulently invoked. And, the court explained, the Department of Labor has issued regulations that disallow employees who fraudulently obtain FMLA leave from invoking FMLA protections.

Dishonest employees, the court remarked, pose a special risk to airlines that are charged with providing transportation services to the public. The court upheld summary judgment for United.

To read the full opinion, click here.

Panel: WILKINSON and FLOYD, Circuit Judges, and IRENE M. KEELEY, United States District Judge for the Northern District of West Virginia, sitting by designation.

Argument Date: 09/21/2016

Date of Issued Opinion:
10/31/2016

Docket Number: No. 15-1747

Decided: Affirmed by published opinion

Case Alert Author: Laura Tallerico, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Robert Scott Oswald, THE EMPLOYMENT LAW GROUP, P.C., Washington, D.C., for Appellant. Hugh Scott Johnson, Jr., PCT LAW GROUP, PLLC, Alexandria, Virginia, for Appellee. Stephen Z. Chertkof, HELLER, HURON, CHERTKOF & SALZMAN, PLLC, Washington, D.C., for Amici Curiae. ON BRIEF: Andrea M. Downing, THE EMPLOYMENT LAW GROUP, P.C., Washington, D.C.; Richard T. Seymour, LAW OFFICE OF RICHARD T. SEYMOUR, P.L.L.C., Washington, D.C., for Appellant. Angela H. France, PCT LAW GROUP, PLLC, Alexandria, Virginia, for Appellee. Erik D. Snyder, LAW OFFICES OF ERIK D. SNYDER, Washington, D.C.; Alan R. Kabat, BERNABEI & WACHTEL, PLLC, Washington, D.C.; Matthew C. Koski, NATIONAL EMPLOYMENT LAWYERS ASSOCIATION, Oakland, California, for Amici Curiae.

Author of Opinion: Judge Wilkinson

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/17/2016 09:15 AM     4th Circuit     Comments (0)  

  Ripley v. Foster Wheeler LLC -- Fourth Circuit
Scope of "Government Contractor Defense" Expanded to Apply in Failure to Warn Cases

Areas of Law: Products Liability, Federal Jurisdiction

Issue presented: Whether the "government contractor defense" is available to defendants in failure to warn cases.

Brief Summary: The United States Court of Appeals for the Fourth Circuit rejected Eastern District of Virginia guidance which limited the "government contractor defense" to design defect cases. The same rationales that the Supreme Court offered for the defense in design defect cases apply equally to failure to warn claims. Therefore, the Fourth Circuit held that the government contractor defense is available in failure to warn cases.

Extended Summary: Bernard W. Ripley was diagnosed with malignant mesothelioma twenty-five years after he stopped working as a boilermaker at Norfolk Naval Shipyard. Mr. Ripley and his wife brought suit in Virginia state court against multiple defendants including Foster Wheeler LLC and Foster Wheeler Energy Corporation ("Foster"). The complaint alleged that Mr. Ripley was exposed to asbestos contained in products that Foster manufactured for the Navy. The complaint further alleged that Foster failed to warn of the asbestos hazards.

Foster filed a notice of removal in the United States District Court for the Eastern District of Virginia. Foster claimed removal was appropriate under the federal officer removal statute, 28 U.S.C. § 1442(a)(1). To remove a case under this statute, a defendant must establish: "(1) that it is a federal officer or 'a person acting under that officer,'" "(2) a 'colorable federal defense'; and (3) that the suit is 'for an act under color of office.'" Foster asserted a government contractor defense to satisfy the colorable federal defense element. The district court, however, remanded the case to state court, reiterating its "decades-old practice" of denying the government contractor defense in failure to warn cases. Without the defense, the district court did not have federal subject matter jurisdiction.

Foster appealed, asking the Fourth Circuit to reverse the remand order. The Fourth Circuit reversed and remanded the case to the federal trial court, holding that the government contractor defense is available in failure to warn cases and instructing the district court to determine whether Foster presented sufficient proof to warrant removal under the federal officer removal statute.

The Fourth Circuit began by reviewing the United States Supreme Court case Boyle v. United Technologies Corp., 487 U.S. 500 (1988). In Boyle, the Court announced that "design defects in military equipment do not give rise to state-law tort claims if" the three elements of the government contractor defense are satisfied. The Court offered two rationales for the defense. First, separation of powers suggests that the judiciary should be hesitant to interfere with complex military decision-making made by the branches constitutionally delegated with the war powers. Second, if government contractors are required to take on a higher risk of liability, they will pass those costs on to the government; meaning that the supply of contractors, as well as research and development in military equipment, will decrease.

After the Fourth Circuit reviewed both of these rationales, it held that the government contractor defense may apply in failure to warn cases for two reasons. First, the Eastern District of Virginia was an "outlier" in failing to recognize the government contractor defense in failure to warn cases. The Second, Fifth, Sixth, Seventh, Ninth and Eleventh Circuits have all applied the defense to failure to warn cases. Second, the rationales articulated by the Supreme Court for applying the defense in design defect cases apply with equal force to failure to warn cases. The judiciary should be hesitant to interfere with the complex warning and labeling requirements particular to military procurement contracts and specifications. Furthermore, the effect on government contractors is the same regardless of whether they are forced to take on a higher risk of liability for design defect or failure to warn claims.

To read the full opinion, click here.

Panel: Judges Traxler, Diaz, and Thacker

Argument Date: 09/22/2016

Date of Issued Opinion: 11/1/2016

Docket Number: No. 15-1918

Decided: Reversed and remanded by published opinion.

Case Alert Author: Annie McGuire, Univ. of Maryland Carey School of Law

Counsel:
ARGUED: Erik David Nadolink, WHEELER TRIGG O'DONNELL, LLP, Denver, Colorado, for Appellants. William Harty, PATTEN, WORNOM, HATTEN & DIAMONSTEIN, L.C., Newport News, Virginia, for Appellee. ON BRIEF: Anthony B. Taddeo, Jr., David M. Sturm, Matthew D. Joss, TADDEOSTURM PLC, Richmond, Virginia, for Appellants. Robert R. Hatten, Hugh B. McCormick, III, PATTEN, WORNOM, HATTEN & DIAMONSTEIN, L.C., Newport News, Virginia, for Appellee.

Author of Opinion: Judge Thacker

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/17/2016 08:35 AM     4th Circuit     Comments (0)  

November 10, 2016
  Dingle v. Stevenson -- Fourth Circuit
Roper v. Simmons Does Not Retroactively Invalidate a Guilty Plea

Areas of Law: Criminal Law, Habeas Corpus

Issue Presented: Whether Roper v. Simmons, the United States Supreme Court's decision that invalidated the death penalty for juvenile offenders, may be applied retroactively to invalidate a defendant's guilty plea, where the dependent pled guilty to avoid the death penalty.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that Roper, a substantive rule, did not apply retroactively to invalidate Dingle's guilty plea for three reasons. First, Roper applies only to sentences of capital punishment, while Dingle received a life sentence with the possibility of parole. Second, the Supreme Court has not suggested that a substantive rule stretches beyond the proscribed sentence to reopen guilty pleas with a different sentence. Third, Roper does not undermine the voluntariness of Dingle's guilty plea. Therefore, the Fourth Circuit affirmed the district court's dismissal of Dingle's habeas corpus petition.

Extended Summary: In 1993, Ronald Donald Dingle ("Dingle"), a 17-year-old juvenile at the time of his offense, was charged by the state of South Carolina with murder and a number of other crimes. The state intended to seek the death penalty against Dingle. Dingle pled guilty to all the charges in exchange for life imprisonment with the possibility of parole.

In 2005, the Supreme Court decided Roper v. Simmons, 543 U.S. 551 (2005), which held that imposing capital punishment on juvenile offenders violated the Eighth Amendment. In 2013, Dingle filed a petition for writ of habeas corpus under 28 U.S.C. § 2254 in the United States District Court for the District of South Carolina. Dingle argued that Roper articulated a substantive rule that applied retroactively to his case and, therefore, his guilty plea should be abrogated. The district court found that Roper did not apply to situations where a defendant pled guilty to a non-capital sentence to avoid the possibility of a capital sentence. The district court denied Dingle's petition in its entirety.

Dingle appealed to the Fourth Circuit. The Fourth Circuit granted a certificate of appealability on one issue: "whether Roper v. Simmons, 543 U.S. 551 (2005), may be applied retroactively to invalidate Dingle's guilty plea where, pre-Roper, he allegedly pled guilty to avoid the death penalty."

The Fourth Circuit acknowledged that Roper was a substantive rule. However, in Roper, the Supreme Court made clear that its holding should be construed to apply only to capital punishment. As Dingle did not receive the death penalty, the Fourth Circuit held that Roper did not apply to Dingle's case.

The Fourth Circuit observed that the death penalty operated only as part of the calculus in Dingle's plea negotiations. In the court's view, acknowledging that Roper might have altered the calculus was "a far cry from finding that its substantive rule applie[d]." Citing Montgomery v. Louisiana, 136 S. Ct. 718 (2016), the Fourth Circuit explained that the Supreme Court has not yet suggested that a substantive rule stretches beyond the proscribed sentence to reopen guilty pleas with a different sentence. Pleading guilty typically entails a deliberate choice to accept the risks and rewards of a deal, and that decision may "not be casually set aside on the basis of buyer's remorse."

The Fourth Circuit explained that this principle was applied in Brady v. United States, 397 U.S. 742 (1970), a case similar to Dingle's case. In Brady, a criminal defendant was death penalty eligible and pled guilty to avoid capital punishment. When a subsequent Supreme Court decision would have made the defendant ineligible for the death penalty, the defendant urged that he be permitted to withdraw his plea. The Supreme Court rejected this argument, reasoning that "[t]he fact that Brady did not anticipate United States v. Jackson does not impugn the truth or reliability of his plea."

The Fourth Circuit held that although Roper altered the calculus underlying Dingle's decision to accept a plea agreement, it did "not undermine the voluntariness of his plea." Therefore, the Fourth Circuit affirmed the district court's dismissal of Dingle's petition.

To read the full opinion, clickhere.

Panel: Judges Wilkinson, Motz, and Harris

Argument Date: 09/20/2016

Date of Issued Opinion: 10/25/2016

Docket Number: No. 15-6832

Decided: Affirmed by published opinion

Case Alert Author: Ziyi He, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Stephen J. van Stempvoort, MILLER JOHNSON, Grand Rapids, Michigan, for Appellant. Alphonso Simon, Jr., OFFICE OF THE ATTORNEY GENERAL OF SOUTH CAROLINA, Columbia, South Carolina, for Appellee. ON BRIEF: Alan Wilson, Attorney General, John W. McIntosh, Chief Deputy Attorney General, Donald J. Zelenka, Assistant Deputy Attorney General, OFFICE OF THE ATTORNEY GENERAL OF SOUTH CAROLINA, Columbia, South Carolina, for Appellee.

Author of Opinion: Judge Wilkinson

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/10/2016 04:37 PM     4th Circuit     Comments (0)  

  Carlson v. Dyncorp Int'l LLC -- Fourth Circuit
Whistleblower Friendly: Fourth Circuit Introduces "Objectively Reasonable Belief" Standard

Areas of Law: Whistleblower Law, Civil Procedure

Issue Presented: Whether a court should apply an "objectively reasonable belief" standard in determining if an employee made efforts to stop a False Claims Act violation under the whistleblower provision of that statute.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that the district court should have applied an "objectively reasonable belief" standard, instead of a "distinct possibility" standard, in determining whether the plaintiff engaged in a protected activity by making efforts to stop an FCA violation. Nevertheless, the Fourth Circuit affirmed the district court's dismissal of the plaintiff's claim. The Fourth Circuit noted that the plaintiff's belief that his employer (the defendant) was violating the FCA was not objectively reasonable, because the defendant's under-billing of the government was not an FCA violation.

Extended Summary: The False Claims Act (FCA)'s whistleblower provision, 31 U.S.C 3730(h)(1), protects a government contractor's employee from the contractor's retaliatory conduct as a result of "lawful acts done by the employee . . . in furtherance of an action under this section" (the first prong) or "other efforts to stop [one] or more violations of this subchapter" (the second prong). In other words, the two kinds of protected activity are: 1) activity that supports an FCA action against the employer alleging a fraud on the government, and (2) activity that is part of an effort to stop an FCA violation. To establish a prima facie case under this provision (and thus survive a motion to dismiss), the employee must plausibly allege that he engaged in one of these two kinds of protected activity.

Carlson, a Director of Stabilization and Governance at government contractor DynCorp International, LLC (DynCorp), raised concerns with his supervisors about lower-than - average indirect costs that DynCorp included in its bid for a government contract. Carlson also informed his supervisors about DynCorp's other irregular accounting and billing practices. The supervisors did not address his concerns. Carlson was soon fired by DynCorp and was told his termination was due to a reorganization.

In the district court, Carlson filed a lawsuit against DynCorp under the FCA whistleblower provision for retaliatory termination. Carlson claimed that his questioning DynCorp's accounting and billing practices constituted an effort to stop an FCA violation, the second prong of the whistleblower provision. He also claimed that he was terminated by DynCorp in retaliation for engaging in his protected activity. The U.S. District Court for the Eastern District of Virginia dismissed Carlson's complaint without prejudice under Rule 12(b)(6) for failure to state a claim. Carlson re-filed, and the district court dismissed his amended complaint with prejudice for the same reason. In reaching its decision, the district court applied a "distinct possibility" standard established by Eberhardt v. Integrated Design & Const., Inc. Under this standard, an employee engages in protected activity "when the conduct reasonably could lead to a viable FCA action." 167 F.3d 861 (4th Cir. 1999).

The Fourth Circuit held that the "distinct possibility" standard did not apply to the second prong for three reasons. First, because the second prong specifically states "other efforts," applying the "distinct possibility" standard renders the second prong "nonsensical." Second, the "distinct possibility" standard no longer existed once Congress excised the relevant language from the provision in 2009. Third, applying the "distinct possibility" standard to both the old and the new language would render the latter a nullity, in contradiction to a canon that courts engaged in statutory interpretation must "give each word some operative effect."

The Fourth Circuit then "assume[d], without deciding," that Carlson's proposed "objectively reasonable belief" standard applied. Under this standard, efforts to stop an FCA violation constitute protected activity where "those efforts are motivated by an objectively reasonable belief that the employer is violating, or soon will violate, the FCA." In adopting the "objectively reasonable belief standard," the court noted that the 6th, 7th, 8th, and 9th Circuits have already adopted this standard. Second, the "objectively reasonable belief" standard aligns with the Fourth Circuit's treatment of similarly structured whistleblower provisions in Title VII, the Age Discrimination in Employment Act, and the Americans with Disability Act.

Applying the "objectively reasonable belief" standard, the Fourth Circuit held that Carlson failed to show that his belief that DynCorp was violating the FCA was objectively reasonable. The court found that all Carlson accused DynCorp of doing was under-billing the government on existing contracts. Noting that the intent of the FCA was to "reach all types of fraud . . . that might result in financial loss to the Government," the court held that under-billing would not cause such loss and was, thus, not an FCA violation.

To read the full opinion, click here.

Panel: Chief Judge Gregory, Circuit Judges Motz and Thacker

Argument Date: 03/01/2016

Date of Issued Opinion: 08/22/2016

Docket Number: No. 14-1281

Decided: Affirmed by unpublished opinion.

Case Alert Author: Ziyi He, Univ. of Maryland Carey School of Law

Counsel: Jacob Madison Small, J. MADISON PLC, McLean, Virginia, for Appellant. Edward T. Ellis, LITTLER MENDELSON, P.C., Philadelphia, Pennsylvania, for Appellee. ON BRIEF: Andrew B. Rogers, LITTLER MENDELSON, P.C., McLean, Virginia, for Appellee.

Author of Opinion: Chief Judge Gregory

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/10/2016 01:04 PM     4th Circuit     Comments (0)  

  Upstate Citizens for Equality v. United States of America - Second Circuit
Headline: Second Circuit Affirms District Court's Finding that Entrustment of New York Oneida Indian Nation Land to Federal Government for Tribe's Benefit and Use was Constitutional

Area of Law: Constitutional

Issue Presented: Was the entrustment of Indian land under the Indian Reorganization Act of 1934 permissible if neither the Indian tribe nor the government continuously held or supervised the land?

Brief Summary: The Oneida Indian Nation Tribe ("the Tribe") sought to have a portion of central New York land held in trust for the Tribe's benefit by the federal government pursuant to § 5 of the Indian Reorganization Act of 1934 to, among other things, allow the Tribe to continue operating its Turning Stone Casino on part of that land. In May of 2008, the Department of the Interior accepted 13,000 acres of central New York land into trust for the Tribe. Plaintiffs, local New York towns and residents, filed suit claiming that the entrustment process was unconstitutional and infringed on New York State's sovereignty. The United States District Court for the Northern District of New York granted the federal government's motion for summary judgment. On the plaintiffs' appeal, the Second Circuit affirmed. The Second Circuit held that the federal government has broad authority in dealing with Indian affairs and the entrustment for the Tribe's benefit was proper even if all of the land sat within a single state and the federal supervision of the land was not continuous, and the entrustment did not violate the United States Constitution's Enclave Clause - which requires state consent for certain federal assertions of jurisdiction over state land - because the federal government does not have "exclusive" jurisdiction over the land in question.

To read the full decision, please visit:
http://www.ca2.uscourts.gov/de...1d2b862d310/1/hilite/

Extended Summary: The Oneida Nation Tribe ("the Tribe") is a federally recognized Indian tribe situated in central New York. Under the 1788 Treaty of Fort Schuyler, the Tribe sold all but 300,000 acres of their land to New York. In 1794, the federal government entered into the Treaty of Canandiagua, which acknowledged the Treaty of Fort Schuyler, and guaranteed the free use and enjoyment of the reservation for the Tribe. The Tribe continued, however, to sell portions of their land leaving only 32 acres remaining by 1920.

In the 1990s, the Tribe began acquiring parcels of land that were originally party of the Tribe's reservation, eventually opening the Turning Stone Resort Casino on their land. In an earlier action by the town where the casino is located to evict the Tribe from the land for nonpayment of property taxes, the Second Circuit held that because the land was originally part of the earlier treaties, the Tribe was exempt from state property taxes. The United States Supreme Court disagreed, but suggested that the Tribe utilize § 5 of the Indian Reorganization Act of 1934 ("IRA"), which would allow the Tribe to reestablish sovereign authority over the territory by allowing the land to be "taken in the name of the United States in trust for the [] Tribe." 25 U.S.C. § 465. In May 2008, upon the Tribe's request, the Department of the Interior announced its decision to accept approximately 13,000 acres of the land into trust.

Plaintiffs, two New York towns, select residents, and a civic organization, challenged the Secretary of the Interior's decision in federal district court. The United States District Court for the Northern District of New York granted the government's motion for summary judgment on the plaintiffs' claims that the land-into-trust mechanism was unconstitutional and infringed on state sovereignty in addition to asserting the Department of the Interior did not have the authority to take lands in trust for the Tribe.

Plaintiffs argued that the Indian Commerce Clause did not permit the federal government to take action when the action would take place entirely within a single state. The Second Circuit rejected this argument, noting the exceptionally broad power of the federal government in the context of Indian affairs and, citing Supreme Court's 1989 decision in Cotton Petroleum Corp. v. New Mexico, distinguished between the Commerce Clause and the Indian Commerce Clause - finding the latter not containing an implicit "interstate" limitation.

Additionally, Plaintiffs asserted that the federal entrustment, by requiring the state to cede some of its authority to the federal and tribal governments, unconstitutionally infringed on New York's sovereign rights. The Second Circuit held that even though the federal supervision of the Tribe's land was not continuous, it did not preclude Congress from acquiring the land on behalf of the Tribe, even if New York lost some of its governmental power over the land, citing another Supreme Court decision that highlighted the broad federal power to deal with Indian affairs.

The Plaintiffs also argued that the Enclave Clause required Congress to obtain the state legislature's express consent before taking land into trust for Indians. The rarely invoked Enclave Clause ensures that "places on which the security of the entire Union may depend [are not] in any degree dependent on a particular member of it." The Second Circuit found the Enclave Clause inapplicable, however, because it requires that the federal government have "exclusive" jurisdiction for the clause to apply and states still maintain some jurisdiction over the land in trust.

Finally, the Second Circuit found the Plaintiffs assertions that the Tribe was not eligible to be the beneficiary of land entrustment based on the interpretation of "Indians" and "tribe" unpersuasive. The Second Circuit affirmed the district court's judgment that the entrustment of the Tribe's land was proper.

To read the full opinion, please visit: http://www.ca2.uscourts.gov/de...1d2b862d310/1/hilite/

Panel: Circuit Judges Livingston, Chin, and Carney

Argument Date: 5/3/2016

Date of Issued Opinion: 11/9/2016

Docket Numbers:
15-1688, 15-1726

Decided: Affirmed.

Case Alert Author: Scott L. Wenzel

Counsel: David Brown Vickers, for Upstate Citizens for Equality, Inc.; Cornelius D. Murray, O'Connell and Aronowitz, for Town of Vernon, Town of Verona, Abraham Acee, and Arthur Strife; J. David Gunter, United Sates Department of Justice, for the United States of America, Sally M.R. Jewell, Micahel L. Conner, and Elizabeth J. Klein.

Author of Opinion: Judge Carney

Circuit: Second Circuit

Case Alert Circuit Supervisor:
Elyse Diamond

    Posted By: Elyse Diamond @ 11/10/2016 11:07 AM     2nd Circuit     Comments (0)  

November 8, 2016
  Al Shimari, et al. v. CACI Premier Technology, Inc., et al. -- Fourth Circuit
Fourth Time's the Charm? Fourth Circuit Decides Applicability of Political Question Doctrine to Abuse at Abu Ghraib Prison

Areas of Law: Constitutional Law

Issue Presented: Whether the district court erred in dismissing appellant's complaint as non-justiciable under the political question doctrine, where that complaint alleged abuses suffered at the hands of a government contractor at the Abu Ghraib prison in Iraq.

Brief Summary: In a published opinion, the United States Court of Appeals for the Fourth Circuit vacated the dismissal of the appellant's complaint by the United States District Court for the Eastern District of Virginia, in the fourth appearance of this case before the court. The district court had held that the complaint presented a non-justiciable political question because a judicial decision on the complaint (by former detainees of the Abu Ghraib prison in Iraq against a military contractor) would question sensitive military judgments. However, the Fourth Circuit found the district court erred by conducting an incomplete analysis into whether the military had direct control over the actions of the defendant and therefore outlined new rules as to when government contractors are shielded from judicial review under the political question doctrine. The case was remanded for the district court to reexamine its subject matter jurisdiction over the case based on the new rules.

Extended Summary: In 2008, four Iraqi nationals filed suit against CACI Premier Technology, Inc. (CACI), alleging repeated and systemic abuse by the defendant's employees, while they were detained by the United States at the Abu Ghraib prison in Iraq in 2003 and 2004. CACI is a government contractor that performed interrogation services for the military at Abu Ghraib during the period of the appellants' detention. The appellants were ultimately released from Abu Ghraib without charges, but allege in the complaint that CACI employees committed acts involving torture, war crimes, and cruel, inhuman, or degrading treatment during the period of their incarceration and all in violation of the Alien Tort Statute. The appellants also filed common law tort claims, including assault and battery, sexual assault and battery, and intentional infliction of emotional distress. The appellants assert that the alleged acts of abuse occurred because there was a command vacuum at the prison, in that military leaders failed to exercise control over the actions of the CACI interrogators and low-level military officers.

The instant appeal is the fourth time this case has been before the Fourth Circuit. The last time the case was before the court, the Fourth Circuit remanded the case back to the district court to conduct jurisdictional discovery on the issue of whether the political question doctrine barred the plaintiffs' claims. In that decision, the court declined to decide the political question issue because of a limited appellate record, but instructed the district court to undertake a factual inquiry as to the extent of the military's actual control over CACI interrogators and then to decide whether the claims implicated the political question doctrine.

On remand, the district court dismissed the complaint finding the claim presented a non-justiciable political question; more specifically, the district court found the military exercised direct control over interrogations at the prison, which would require an improper inquiry into sensitive military judgments under the political question doctrine. The district court also held that it lacked any judicially manageable standards to resolve the claims.

The appellants filed this appeal to the Fourth Circuit, asserting that the district court erred in finding the military had direct control over interrogations and in failing to evaluate whether the military had actually exercised such control over the actions of CACI interrogators. The appellants also argued that their claims would not require an evaluation of sensitive military judgments because the claims challenged the legality, not the reasonableness, of CACI's conduct. Finally, the appellants argued that the district court did indeed have manageable standards to resolve the claims.

The court first noted that a claim is not shielded from judicial review merely because it arises from action taken under orders of the military. In re KBR, Inc., Burn Pit Litigation, 744 F.3d 326, 333 (4th Cir. 2014). In Baker v. Carr, 369 U.S. 186 (1962), the Supreme Court established a six-factor test to aid courts in determining whether a case presents a political question barred from judicial review. Then, in Taylor v. Kellogg Brown & Root Services, Inc., 658 F.3d 402 (4th Cir. 2011), the Fourth Circuit distilled the six Baker factors into two factors to determine whether a court has subject-matter jurisdiction in a civil liability suit against a government contractor: (1) whether the government contractor was under the direct control of the military, and (2) whether a decision on the merits of the claim would require the court to question actual and sensitive military judgments. An affirmative response to either factor will generally trigger the political question doctrine.

Discussing the first factor from Taylor, the court in the instant case found that the district court failed to properly examine the level of direct control the military had over the actions of CACI. The district court found evidence that the military had formal control over the actions of CACI interrogators in the form of a command structure, outlined procedures, and various memoranda establishing the rules of interrogation. That court concluded such evidence was enough to satisfy the first Taylor prong, and dismissed the complaint without inquiring into the level of actual control. The Fourth Circuit, however, rejected the district court's conclusion and found there was evidence that the district court had ignored of the military's failure to exercise actual control. For example, the district court failed to evaluate a government report concluding that the higher ranking officers at the prison failed to supervise their subordinates.

The court laid out two new rules to aid the district court on remand in deciding this first Taylor factor. First, the Fourth Circuit instructed that when a contractor engages in a lawful action under the actual control of the military, the contractor's action will be considered a de facto military decision shielded from judicial review under the political question doctrine. Second the Fourth Circuit instructed that when a contractor engages in unlawful conduct, irrespective of the nature of control exercised by the military, the contractor cannot claim protection under the political question doctrine because the military cannot lawfully exercise its authority by directing a contractor to engage in unlawful activity. In other words, the actions of a contractor can only be shielded from judicial review under the first Taylor factor if they both were committed under actual control of the military and were lawful.

The court then turned to the second Taylor factor, which considers whether judicial review will require the district court to question military judgments. The court concluded that the district court analysis was incomplete because it failed to draw the distinction between lawful and unlawful conduct as related to the military. The court stated that unlawful actions cannot be based on military expertise and judgment, so claims alleging unlawful conduct applicable to the CACI employees will fall outside the political question doctrine. As a result, the court ordered that the district court must, on remand, separate justiciable claims based on unlawful actions from those that actually question military decisions and are therefore shielded from judicial review. The court also noted that statutory allegations against a government contractor, such as the one in this case involving the Alien Tort Statute, are generally justiciable because adjudication of those claims only requires a court to state the law and apply the facts to it, a traditional judicial function that does not require a judgment on military decisions. According to the court, some of the alleged conduct will undoubtedly be subject to judicial review as clearly unlawful, such as sexual assaults and beatings, while others may be shielded, but the court declined to make a comprehensive determination on those decisions.

The court also ruled that the district court does indeed have manageable standards to resolve the issues herein on remand. The court stated that although the substantive international law at issue in the complaint may be unfamiliar and complicated, it is the function of the judiciary to decide such issues via interpretation of statutory terms and established international norms, as other federal courts have done before. The court ruled that the district court cannot abdicate the normal judicial role just because of the complexity of the issues presented.

Panel: Judges Keenan, Floyd, and Thacker

Argument Date: 05/12/2016

Date of Issued Opinion: 10/21/2016

Docket Number: No. 15-1831

Decided: Vacated and remanded by published opinion

Case Alert Author: Patrick J.L. Dillon, University of Maryland Carey School of Law

Counsel: ARGUED: Baher Azmy, CENTER FOR CONSTITUTIONAL RIGHTS, New York, New York, for Appellants. John Frederick O'Connor, Jr., STEPTOE & JOHNSON, LLP, Washington, D.C., for Appellee. ON BRIEF: Katherine Gallagher, CENTER FOR CONSTITUTIONAL RIGHTS, New York, New York; Robert P. LoBue, PATTERSON BELKNAP WEBB & TYLER LLP, New York, New York; Shereef Hadi Akeel, AKEEL & VALENTINE, P.C., Troy, Michigan; Jeena Shah, CONSTITUTIONAL RIGHTS & INTERNATIONAL HUMAN RIGHTS CLINIC, Newark, New Jersey, for Appellants. Stephen I. Vladeck, Washington, D.C.; Charles S. Barquist, Los Angeles, California, Betre M. Gizaw, MORRISON & FOERSTER LLP, Washington, D.C., for Amici Professors of Constitutional Law and Federal Courts. Eric L. Lewis, A. Katherine Toomey, James P. Davenport, Waleed Nassar, LEWIS BAACH PLLC, Washington, D.C.; Melissa Hooper, HUMAN RIGHTS FIRST, New York, New York, for Amici Retired Military Officers. Dror Ladin, Hina Shamsi, AMERICAN CIVIL LIBERTIES UNION FOUNDATION, New York, New York, for Amici American Civil Liberties Union Foundation, Amnesty International, and Human Rights Watch. George M. Clarke, III, BAKER & MCKENZIE LLP, Washington, D.C.; Alberto Mora, Carr Center For Human Rights Policy, HARVARD KENNEDY SCHOOL, Cambridge, Massachusetts, for Amicus Alberto Mora. William J. Aceves, CALIFORNIA WESTERN SCHOOL OF LAW, San Diego, California; Deena R. Hurwitz, International Human Rights Law Clinic, AMERICAN UNIVERSITY, Washington, D.C., for Amicus Juan E. Mendez. L. Kathleen Roberts, Nushin Sarkarati, THE CENTER FOR JUSTICE & ACCOUNTABILITY, San Francisco, California; Michael E. Tigar, Oriental, North Carolina; Ali A. Beydoun, UNROW HUMAN RIGHTS IMPACT LITIGATION CLINIC, Washington, D.C., for Amici Abukar Hassan Ahmed, Dr. Juan Romagoza Arce, Zita Cabello, Aziz Mohamed Deria, Carlos Mauricio, Gloria Reyes, Oscar Reyes, Cecilia Santos Moran, Zenaida Velasquez, and Bashe Abdi Yousuf. Lawrence S. Ebner, Lisa N. Himes, Tami Lyn Azorsky, Jessica C. Abrahams, DENTONS US LLP, Washington, D.C., for Amici Professional Services Council-The Voice of the Government Services Industry, and Coalition for Government Procurement. Raymond B. Biagini, Daniel L. Russell Jr., Herbert L. Fenster, COVINGTON & BURLING LLP, Washington, D.C., for Amicus KBR, Incorporated.

Author of Opinion: Judge Keenan

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/08/2016 02:48 PM     4th Circuit     Comments (0)  

  Simms v. United States - Fourth Circuit
Collateral Source Rule Permits Plaintiff's Recovery Despite Medicaid Payments

Areas of Law: Medical Malpractice, Federal Tort Claims Act

Issues Presented: 1) Whether the district court erred in calculating damages awarded to plaintiff for her son's past and future medical expenses; 2) whether the district court erred in measuring plaintiff's damages using the amount medical providers billed, rather than the amount the Medicaid program paid to providers; and 3) whether the district court erred in failing to hold a post-verdict prejudgment collateral source hearing.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that the district court 1) properly awarded plaintiff damages attributable to her child's past medical expenses pursuant to West Virginia's "collateral source rule"; 2) correctly measured plaintiff's damages using the amount medical providers billed for her son's care, rather than the amount the West Virginia Medicaid program paid to providers; and 3) erred in failing to hold a post-verdict prejudgment collateral source hearing. However, the court vacated the district court's judgment with respect to damages awarded for past and future medical expenses and remanded the case to the district court for failure to hold a collateral source hearing.

Extended Summary: Misty Simms received prenatal care at a federally-supported health care center in West Virginia. In February 2008, Simms' physician detected potential fetal abnormalities during a routine ultrasound while Simms was eighteen weeks pregnant. The physician did not inform Simms of the concerns. Three months later, after a series of follow-up appointments, Simms learned that her fetus' brain was extremely underdeveloped, her child would never walk or talk, and would be severely mentally disabled. By then, Simms was in her third trimester and West Virginia law prohibited her from terminating her pregnancy. Simms gave birth to a son who was severely disabled and in an ongoing "vegetative state." He is now eight-years-old and has required twenty-four-hour care and monitoring throughout his life. To date, his care has cost over two million dollars in medical expenses. In 2011, Ms. Simms brought a wrongful birth action against the federal government under the Federal Tort Claims Act (FTCA). The district court found the government liable and awarded her over twelve million dollars in damages, including past billed medical expenses and future medical expenses for her son's care over a twenty-one-year life expectancy. The government appealed, challenging only the court's award of damages for past and future medical expenses.

First, the government argued that Simms did not have a right to recover past medical expenses because Medicaid paid those expenses. Under West Virginia law, a parent who brings a wrongful birth suit is entitled to recover the costs of raising a child with birth defects. The Fourth Circuit determined that such damages include medical costs attributable to the birth defects before and after the child reaches age 18. Further, parents are entitled to such recovery because of their legal obligation to support their child. The court found that Simms was entitled to recovery because she had a legal obligation to support her child and the health care center's negligence increased the weight of that obligation. Moreover, citing Kenney v. Liston, 760 S.E.2d 434, 440 (W. Va. 2014), the court reasoned that the collateral source rule protects payments made to or on behalf of an injured party from a third party such as insurance including Medicaid. Thus, the court held, the collateral source rule protected Simms' Medicaid payments and prohibited the government from offsetting Simms' damages based on Medicaid payment of her son's medical expenses.

Second, the government argued that even if the collateral source rule applied, the district court erred by calculating Simms' damages based on the amount her son's medical providers billed, rather than the amount the Medicaid program actually paid. The Fourth Circuit rejected this argument as well, noting that under West Virginia law, the proper measure of damages for medical expenses is the reasonable value of necessary medical services regardless of the amount actually paid. Citing Kenney, the court determined that benefits conferred by public payers, such as the West Virginia Medicaid program, do not alter the collateral source rule analysis. Thus, the court concluded, proof of the original medical bill is prima facie evidence that the expense was necessary and reasonable regardless of the amount paid and held that the district court did not err in calculating Simms' damages.

Finally, the government argued that the district court erred in refusing to reduce the damages award pursuant to West Virginia's Medical Professional Liability Act. That statute entitles a defendant to a post-verdict prejudgment hearing regarding a plaintiff's payments received from collateral sources. The court noted that the district court did not hold a collateral source hearing pursuant to the Act before it entered judgment. The court reasoned that a hearing was necessary for the district court to determine whether the statute entitled the government to a damages reduction and whether the Medicaid program may recover from Simms by subrogation, lien or reimbursement. Accordingly, the court vacated the district court's judgment with respect to damages awarded for past and future medical expenses and remanded the case to the district court to hold the requisite collateral source hearing.

To read the full opinion, click here.

Panel: Wynn and Harris, Circuit Judges, and Biggs, District Judge

Argument Date: 01/27/2016

Date of Issued Opinion: 10/07/2016

Docket Number: No. 15-2161

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

Case Alert Author: Yvette Pappoe, Univ. of Md. Carey School of Law

Counsel: Edward Himmelfarb, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellant. Mark Davis Moreland, MORELAND & MORELAND, Lewisburg, West Virginia, for Appellees. ON BRIEF: Benjamin C. Mizer, Principal Deputy Assistant Attorney General, Mark B. Stern, Civil Division, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C.; R. Booth Goodwin II, United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Charleston, West Virginia, for Appellant. Rachel Hanna, LAW OFFICE OF RACHEL HANNA, Lewisburg, West Virginia, for Appellees.

Author of Opinion: Judge Wynn

Case Alert Supervisor: Professor Renée Hutchins

Edited: 11/10/2016 at 12:11 PM by Renee Hutchins

    Posted By: Renee Hutchins @ 11/08/2016 11:57 AM     4th Circuit     Comments (0)  

  Holloman v. Markowski et al. -- Fourth Circuit
Pro Se Litigant Cannot Overcome Heavy Burden of Proof After Officer Fatally Shoots Her Son

Areas of Law: Fourth Amendment

Issues Presented: Whether a litigant who fails to prove widespread or flagrant violations of one's constitutional rights meets the Monell requirements to establish municipal liability under 42 U.S.C. § 1983. Whether a litigant overcome qualified immunity and establish officer liability for use of unreasonable and excessive force without precedent that the force used was unreasonable and excessive.

Brief Summary: In an unpublished per curiam decision, the United States Court of Appeals for the Fourth Circuit affirmed the district court's denial of Plaintiff-Appellant's municipal liability and excessive force claims in this 42 U.S.C. § 1983 action. Plaintiff-Appellant Marcella Holloman brought this case against Baltimore City and two individual police officers in the United States District Court for the District Court of Maryland. The District Court granted the City's motion to dismiss and the officers' motion for summary judgment. The Fourth Circuit affirmed the District Court's decision, relying on the United States Supreme Court decision in Monell v. Dept. of Social Servs. of City of New York, 436 U.S. 658 (1978). Monell established that a Plaintiff "must point to a persistent and widespread practice of municipal officials" where the duration and frequency of such practice demonstrate that the policymakers (1) "had actual or constructive knowledge of the conduct, and (2) failed to correct it due to their deliberate indifference." The Fourth Circuit found that Holloman's claims were too speculative to plausibly claim municipal liability. Additionally, using the Fourth Amendment's "objective reasonableness standard," the Fourth Circuit found the officers' use of force was not excessive. The Fourth Circuit affirmed the District Court's decision.

Extended Summary: Marcella Holloman was hosting a children's birthday party at her home when her son Maurice Donald Johnson, who suffered from bipolar disorder, came home and began breaking pieces of furniture in his bedroom. Hearing the sound of breaking glass, Holloman went up to Johnson's room and told him that she would take him to the hospital for psychiatric treatment after the party. Johnson replied that she would have to call the police to take him because he would not go voluntarily. Holloman and her daughter then removed the children from the home while Johnson continued to destroy personal property around the home. Johnson threw his mattress onto the front lawn and began tearing it apart. Holloman locked him out of the home and called for the police. Johnson kicked the front door, and ripped the back screen door off its hinges. Officers Paul Markowski and Gregory Bragg arrived at Holloman's home in response to the 911 call. Holloman notified the officers of Johnson's psychiatric issues, and explained that he would not stop his destructive behavior. She suggested that the officers use a Taser to bring her son under control, but asked them to not shoot Johnson.

The officers went to the back door and asked Johnson to calm down. Johnson responded by lunging at Officer Markowski, pinning him on the ground with his knees, and fighting him. Officer Bragg's efforts to pull Johnson off of Officer Markowski were unsuccessful. Officer Bragg then fired at least two gunshots, wounding and later killing Johnson.

Filing pro se, Holloman brought this 42 U.S.C. § 1983 action before the United States District Court for the District Court of Maryland against Baltimore City (Mayor Stephanie Rawlings-Blake), the Baltimore City Police Commissioner, Baltimore City Council and Officers Markowski and Bragg, individually. The District Court granted both the City's motion to dismiss and the Officers' motions for summary judgment. Holloman appealed to the Fourth Circuit. The two claims before the court were: the municipal liability claim and the excessive force claim.

The Fourth Circuit first addressed the municipal liability claim, relying on the Supreme Court's decision in Monell v. Dept. of Social Servs. of City of New York, 436 U.S. 658 (1978). There, the Supreme Court "held that municipalities face liability under § 1983 if a municipal policy or custom itself causes a deprivation of constitutional rights." Holloman claimed that the City failed to supervise and train its employees on how to interact with the mentally ill and that it had a general policy, pattern, and/or practice of failing to discipline its officers' conduct.

Monell established two requirements necessary to prevail on a §1983 claim against municipalities. First, a plaintiff needs to "point to a persistent and widespread practice of municipal officials" where the duration and frequency of such practice demonstrated that the policymakers (1) "had actual or constructive knowledge of the conduct, and (2) failed to correct it due to their deliberate indifference." The Fourth Circuit continued that "sporadic or isolated violations of rights" were not sufficient to give "rise to Monell liability." Only evidence of "widespread or flagrant violations" will create such culpability.

Holloman presented four specific instances of on-duty officers in Baltimore City killing citizens. She also presented a Baltimore Sun newspaper article that reported City officers having shot ten individuals, eight of them fatally, and that some of those individuals suffered from a mental illness. The Fourth Circuit held that Holloman failed to present any facts to indicate that the officer shootings she presented involved constitutional violations or that the City failed to properly train or discipline its officers. In the court's view this deficiency meant that Holloman failed to meet the Monell requirements. Finding Holloman's claim too speculative to impose municipal liability, the Fourth Circuit affirmed the District Court's decision, and granted the City's motion to dismiss.

Next, the Fourth Circuit addressed Holloman's excessive force claim against Officers Markowski and Bragg. Using the Fourth Amendment's "objective reasonableness standard" the court analyzed the excessive force claim "from the perspective of a reasonable officer on the scene." The Fourth Circuit noted that government officials sued under §1983 are protected under "qualified immunity unless the official violated a statutory or constitutional right that was clearly established at the time of the challenged conduct." A plaintiff may overcome an officer's qualified immunity only if she can demonstrate that (1) "with the facts viewed in the light most favorable to the Plaintiff, the officer's conduct violated a federal right, and" (2) that the "right was clearly established at the time the violation occurred such that a reasonable person would have known that his conduct was unconstitutional." The Fourth Circuit reasoned that there was no precedent establishing that an officer's use of lethal force is objectively unreasonable and thus, constitutionally excessive when such force is used on an unarmed, yet physically resistant suspect, after the suspect has destroyed property, attacked an officer, and showed no signs of stopping such behavior. The Fourth Circuit concluded that the officers did not use constitutionally excessive force and affirmed the District Court's decision, granting the officers motion for summary judgment.

To read the full opinion, click here.

Panel: Judge Wilkinson, Motz, and Harris

Argument Date: 09/20/2016

Date of Issued Opinion: 10/07/2016

Docket Number: No. 15-1878

Decided: Affirmed by unpublished per curiam opinion.

Case Alert Author: Vanessa Destime, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Stephen Louis Braga, UNIVERSITY OF VIRGINIA SCHOOL OF LAW, Charlottesville, Virginia, for Appellant. Frederic Nelson Smalkin, Jr., William Rowe Phelan, Jr., BALTIMORE CITY LAW DEPARTMENT, Baltimore, Maryland, for Appellees. ON BRIEF: Hardev Chhokar, Brian Remondino, Josh Robbins, Andrew Selman, Third Year Law Students, Appellate Litigation Clinic, UNIVERSITY OF VIRGINIA SCHOOL OF LAW, Charlottesville, Virginia, for Appellant. George Nilson, City Solicitor, BALTIMORE CITY LAW DEPARTMENT, Baltimore, Maryland, for Appellees.

Author of Opinion: Per curiam

Case Alert Supervisor: Professor Renée Hutchins

Edited: 11/08/2016 at 12:44 PM by Renee Hutchins

    Posted By: Renee Hutchins @ 11/08/2016 11:26 AM     4th Circuit     Comments (0)  

  McCray v. Fed. Home Loan Mortg. Corp., et al. -- Fourth Circuit
Foreclosure Attorneys Can Be Considered Debt Collectors under the FDCPA

Areas of Law: Fair Debt Collection Practices Act

Issue Presented: Whether a law firm and its members are "debt collectors" as defined under the Fair Debt Collection Practices Act, when they, on behalf of creditors, pursue foreclosure against a debtor.

Brief Summary: The United States Court of Appeals for the Fourth Circuit reversed the district court's dismissal of the plaintiff's claim under the Fair Debt Collection Practices Act ("FDCPA") against a law firm and its members, because the district court erroneously found they were not "debt collectors" as defined under the FDCPA. The Fourth Circuit held that, as mandated by Powell, to constitute a "debt collector," a person must use a prohibited practice "in connection with the collection of any debt" or in an "attempt to collect any debt." The Fourth Circuit concluded that the defendants' actions surrounding the foreclosure proceeding, including sending a notice of intent to foreclose to the plaintiff, were "attempts to collect [a] debt" and, thus, the defendants were "debt collectors."

Extended Summary: The FDCPA, 15 U.S.C. § 1692a(6), defines the term "debt collector" to include "any person . . . who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another." The definition, however, excludes such a person if his debt collection is "incidental to a bona fide fiduciary obligation." 15 U.S.C. § 1692a(6)(F)(i).

In 2005, Renee McCray ("McCray") took a loan from American Home Mortgage Corporation ("American Home") to refinance her house, giving American Home a 30-year note and a deed of trust on her house to secure repayment of the note. American Home subsequently sold the loan to the Federal Home Loan Mortgage Corporation ("Freddie Mac"), and Wells Fargo was retained to service the loan. In 2011, McCray, disputing a monthly billing statement, sent Wells Fargo a written request for information about the fees and costs that it was charging but received no response. After April 2012, McCray stopped making payments and went into default.

Wells Fargo retained Samuel I. White, P.C. ("the White Firm") to pursue foreclosure. In October 2012, the White Firm sent McCray a notice of intent to foreclose stating the nature of her default and the amount necessary to cure the default. The notice also stated that if McCray did not "bring the loan current . . . such as [by] repayment . . . , a foreclosure action may be filed in court." The notice concluded that the communication was "an attempt to collect a debt." Thereafter, several members of the White Firm were substituted as trustees ("the Substitute Trustees") on the deed of trust and filed for foreclosure in the Circuit Court for Baltimore City in February 2013.

Shortly after the Substitute Trustees commenced the foreclosure proceeding, McCray filed a lawsuit against Freddie Mac, Wells Fargo, the White Firm, and the Substitute Trustees in the United States District Court for the District of Maryland. McCray challenged the amount of her debt and the manner in which the defendants administered the loan. In particular, McCray alleged that the defendants failed to provide McCray with notices and requested information in violation of the FDCPA, the Truth in Lending Act ("TILA"), and the Real Estate Settlement Procedures Act ("RESPA").

The district court dismissed the FDCPA and TILA claims, and granted summary judgment to the defendants for the RESPA claim. With respect to the FDCPA claim against the White Firm and the Substitute Trustees, the only contested issue was whether these defendants were "debt collectors" as defined under the FDCPA. The district court found that the notice of intent to foreclose did not contain an "express demand for payment or specific information about her debt," and thus, was not an attempt to collect the debt. Accordingly, the district court concluded these defendants were not "debt collectors."

The Fourth Circuit affirmed the district court's dismissal of the TILA claim. However, the Fourth Circuit reversed the district court's dismissal of McCray's FDCPA claim against the White Firm and the Substitute Trustees. Citing Powell v. Palisades Acquisitions XVI, LLC, 782 F.3d 119 (4th Cir. 2014), the Fourth Circuit held that to be a "debt collector" under the FDCPA, a person needs only to have used a prohibited practice "in connection with the collection of any debt" or in an "attempt to collect any debt."

The Fourth Circuit found that the White Firm and the Substitute Trustees' activities were taken in connection with the collection of a debt or in an attempt to collect a debt for three reasons. First, citing Wilson v. Draper & Goldberg, P.L.L.C., 443 F.3d 373 (4th Cir. 2006), the Fourth Circuit explained that the plaintiff's "'debt' remained a 'debt' even after foreclosure proceedings commenced" and that the "[defendants'] actions surrounding the foreclosure proceeding were attempts to collect that debt." Second, the notice of intent to foreclose stated that these defendants were pursuing foreclosure because McCray had "missed one or more payments." Further, the notice stated that if McCray did not "bring the loan current . . . such as [by] repayment . . . , a foreclosure action may be filed in court." The notice also provided McCray with the nature of the default (such as the name of the lender and the date of default) and the amount necessary to cure the default. Third, the Fourth Circuit held that the defendants' actions in foreclosing on the property did not fall within the exception under 15 U.S.C. § 1692a(6)(F)(i) because the defendants' actions were not "incidental to their fiduciary obligation." Citing Wilson, the court held that foreclosure was "central" to the trustee's fiduciary obligation under the deed of trust. These factors led the court to conclude the defendants were "attempt[ing] to collect a debt."

Therefore, the Fourth Circuit concluded that the White Firm and the Substitute Trustees were "debt collectors" under the FDCPA. The Fourth Circuit remanded the case to the district court to determine whether the White Firm and Substitute Trustees, as debt collectors, violated the FDCPA.

To read the full opinion, click here.

Panel: Circuit Judges Niemeyer and Wynn, and District Judge Johnston

Argument Date: 05/10/2016

Date of Issued Opinion: 10/07/2016

Docket Number: No. 15-1444

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

Case Alert Author: Maria Nazarova, Univ. of Maryland Carey School of Law

Counsel: Kenzie Marie Rakes, MEYNARDIE & NANNEY, PLLC, Raleigh, North Carolina, for Appellant. Robert Harvey Hillman, SAMUEL I. WHITE, PC, Rockville, Maryland; Michael S. Barranco, TREANOR POPE & HUGHES, P.A., Towson, Maryland, for Appellees.

Author of Opinion: Circuit Judge Niemeyer

Dissenting Opinion: District Judge Johnston on Part IV

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/08/2016 10:05 AM     4th Circuit     Comments (0)  

  United States v. Barnett/United States v. Williams -- Fourth Circuit
Gang's "First Lady" Not Guilty by Association

Areas of Law: Criminal Law, Evidence, Criminal Procedure

Issues Presented: Whether the government provided sufficient evidence to support the defendant's conviction for conspiring to commit murder in aid of racketeering activity. Whether the District Court improperly admitted lay witness testimony related to the meaning of slang words. Whether the District Court erroneously instructed the jury regarding the "pattern of racketeering activity" required for conspiracy to violate RICO. Whether the District Court improperly sentenced the defendant as a career offender in light of the Supreme Court's holding in Johnson v. United States,135 S. Ct. 2551 (2015). Whether the government provided insufficient evidence to prove that a gang leader's girlfriend conspired to violate RICO.

Brief Summary: In an unpublished opinion, the United States Court of Appeals for the Fourth Circuit found no reversible error pertaining to Alan Barnett and affirmed his convictions and sentence. However, the Fourth Circuit concluded the government failed to provide sufficient evidence in Samantha Williams's case and reversed her conviction for conspiring to violate the Racketeer Influenced and Corrupt Organization Act ("RICO").

Extended Summary: This case arose out of a 134-count indictment charging twenty-eight individuals involved with the United Blood Nation gang ("UBN"). Formed at Riker's Island Prison in New York City, UBN operates through a hierarchical structure and consists of several sub-groups along the East Coast. Alan "Big Al" Barnett and Samantha "Lady Sam" Williams were both affiliated with a UBN sub-group called Gangster Killer Bloods, commonly known as "G-Shine." Barnett was the second highest-ranking member of the G-Shine division in North Carolina. Williams was the girlfriend of G-Shine's leader, and hence the organization's "first lady," serving as the "mouthpiece" for the leader during his incarceration.

In a joint trial, the jury convicted both Barnett and Williams of conspiring to violate the Racketeer Influenced and Corrupt Organization Act ("RICO"). The jury also convicted Barnett of conspiracy to commit murder in aid of racketeering activity, two counts of conspiring to commit Hobbs Act robbery, conspiracy to distribute and possession with intent to distribute cocaine base, illegal use of a communication device, and distribution of cocaine. The United States District Court for the Western District of North Carolina sentenced Barnett to 360 months in prison, and sentenced Williams to 72 months in prison.

On appeal, Williams challenged the sufficiency of the evidence supporting her RICO conspiracy conviction. To prove a RICO conspiracy, the government must show (1) that an enterprise affecting interstate commerce existed; (2) that the defendant knowingly and intentionally agreed with another person to participate in the enterprise's affairs; and (3) that the defendant knowingly and willfully agreed that she or another member would commit at least two racketeering acts. Rejecting the government's argument that Williams's role as "first lady" proved the second element, the Fourth Circuit held that it would not broaden RICO's scope to presume that any individual affiliated with a gang knows about and agrees to the commission of racketeering acts. The Fourth Circuit reversed Williams's conviction for RICO conspiracy for insufficiency of evidence.

Additionally, Barnett raised various challenges to his sentence and convictions for RICO conspiracy and conspiracy to commit murder in aid of racketeering activity, all of which the Fourth Circuit rejected. Regarding his convictions, Barnett argued that (1) there was insufficient evidence to prove that Barnett conspired to murder another inmate for the purpose of maintaining or increasing his position in UBN; (2) the District Court erroneously admitted lay witness testimony related to the meaning of slang words; and (3) the District Court erroneously instructed the jury on the standard required for RICO conspiracy. The Fourth Circuit rejected each of Barnett's contentions.

Regarding his sentence, Barnett argued that the District Court improperly sentenced him as a career offender. Citing the Supreme Court's recent invalidation of the residual clause in the Armed Career Criminal Act in Johnson v. United States, 135 S. Ct. 2551 (2015), Barnett argued that the District Court improperly designated him as a career offender under the United States Sentencing Guidelines. The Fourth Circuit held that any error was harmless, emphasizing that the District Court indicated that it would have issued a 360-month sentence without consideration of the sentencing guidelines. The Fourth Circuit therefore upheld Barnett's sentence and convictions.

To read the full opinion, click here.

Panel: Judges Agee and Wynn, and Judge Thomas D. Schroeder of the United States District Court for the Middle District of North Carolina, sitting by designation

Argument Date: 03/24/2016

Date of Issued Opinion: 10/12/2016

Docket Numbers: 14-4866 and 14-4885

Decided: Affirmed in part and reversed in part by unpublished opinion

Case Alert Author: Linda Morris, Univ. of Maryland Carey School of Law
Counsel: Joshua B. Carpenter, FEDERAL DEFENDERS OF WESTERN NORTH CAROLINA, INC., Asheville, North Carolina; Jeffrey William Gillette, GILLETTE LAW FIRM, PLLC, Franklin, North Carolina, for Appellants. Amy Elizabeth Ray, OFFICE OF THE UNITED STATES ATTORNEY, Asheville, North Carolina, for Appellee. ON BRIEF: Ross Hall Richardson, Executive Director, FEDERAL DEFENDERS OF WESTERN NORTH CAROLINA, INC., Asheville, North Carolina, for Appellant Williams. Jill Westmoreland Rose, Acting United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Charlotte, North Carolina, for Appellee.

Author of Opinion: Judge Wynn

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/08/2016 09:47 AM     4th Circuit     Comments (0)  

November 7, 2016
  Tankersley v. Almand, et al. -- Fourth Circuit
Fourth Circuit Upholds Maryland Court of Appeals Suspension of Attorney for Refusal to Disclose Social Security Number

Areas of Law: Privacy Act, Attorney Discipline

Issue Presented: Whether the Maryland Court of Appeals' suspension of an attorney's law license for refusal to provide his social security number to the Client Protection Fund of the Bar of Maryland violates Section 7(a)(1) of the Privacy Act.

Brief Summary: The Maryland Court of Appeals suspended an attorney for refusing to submit his social security number to the Client Protection Fund. The attorney sued claiming the suspension was a violation of Section 7(a)(1) of the federal Privacy Act. The Maryland defendants claimed they had the power to compel the attorney to disclose his social security number under two federal acts, the Welfare Reform Act or the Tax Reform Act. The Fourth Circuit agreed. It held the Tax Reform Act gives states and their agents, including Maryland's Client Protection Fund, the power to collect social security numbers in order to administer taxes. As such, suspending the attorney for his refusal to submit his social security number was not a violation of Section 7(a)(1) of the Privacy act.

Extended Summary: The Maryland Court of Appeals is required by state statute, Md. Code Ann., Bus. Occ. & Prof. § 10-311, to set up a Client Protection Fund (the Fund). The Fund is used to "maintain the integrity of the legal profession" and "to reimburse losses caused by defalcations of lawyers." The Fund must provide to the Maryland Comptroller a list of all lawyers who have paid the annual fee to the Fund. This allows the Comptroller to determine if each lawyer has paid taxes. The Maryland Court of Appeals promulgated rules to comply and cited Section 405 of the federal Tax Reform Act in doing so. The Maryland General Assembly also enacted statutes to comply with the federal Welfare Reform Act. One of these, Md. Code Ann., Fam. Law § 10-119.3(e)(1), requires Maryland licensing authorities to collect applicant's social security numbers.

In accordance with the above laws and regulations, in 2009, then-Chief Judge Robert M. Bell of the Maryland Court of Appeals requested that all members of the Maryland Bar disclose their social security numbers to the Fund. About nine thousand attorneys did not comply and the Maryland General Assembly threatened the court with a large budget cut if it did not take action against the nine thousand. As a result, the Maryland Court of Appeals promulgated Maryland Rule 16-811.5(a)(1) (now rule 19-605(a)(1)), which requires Maryland attorneys to provide their social security numbers to the Fund or face suspension of their law licenses.

Michael Tankersley is a Virginia resident practicing law in the District of Columbia. He has maintained District of Columbia and Maryland bar memberships since 1986 and 1987, respectively. In 2013, the Fund asked Mr. Tankersley to provide his social security number. Mr. Tankersley declined citing identity theft concerns. Thereafter, the Maryland Court of Appeals suspended his law license. He had no prior disciplinary incidents.

Mr. Tankersley filed a lawsuit against James Almand (the Chair of the Fund), the other trustees of the Fund, and the judges and clerk of the Maryland Court of Appeals under Section 7(a)(1) of the Privacy Act. He claimed that Maryland Rule 16-811.5(a)(1) violates Section 7(a)(1) of the Privacy Act. Section 7(a)(1) of the Privacy Act provides that: "t shall be unlawful for any Federal, State or local government agency to deny to any individual any right, benefit, or privilege provided by law because of such individual's refusal to disclose his social security account number" except when required by other federal statute. Mr. Tankersley moved for summary judgment and the defendants cross-moved to dismiss or for summary judgment. The United States District Court for the District of Maryland dismissed Mr. Tankersley's complaint finding that the Welfare Reform Act and the Tax Reform Act supersede the Privacy Act. Mr. Tankersley appealed. The Fourth Circuit affirmed.

On appeal, the Fourth Circuit was tasked with answering the following questions: First, does either the Welfare Reform Act or the Tax Reform Act allow the Fund to compel Tankersley to disclose his social security number? Second, if neither act does so, does the Privacy Act create a Section 1983 private right of action? The second question would have been a question of first impression. However, the majority did not reach that question because it found the Tax Reform Act supersedes the Privacy Act.

The majority first found the Welfare Reform Act could not be used as the basis for compelling Tankersley's social security number. It explained that Section 666 of the Welfare Reform Act requires states to collect social security numbers from applicants for professional licenses and not those already licensed. Tankersley was a licensed attorney and not an applicant.

The majority next found the Tax Reform Act was expansive enough to empower the Fund to collect social security numbers. Section 405 of the Tax Reform Act allows any state, political subdivision or agency responsible for tax administration to collect social security numbers if it is done: 1) for administration of a tax; and 2) from individuals who appear to be affected by the state's tax laws. Mr. Tankersley argued that Section 405 of the Tax Reform Act did not allow the Fund to collect his social security number for three reasons: 1) the statutory requirement that the Fund provide the social security numbers to the Maryland Comptroller does not constitute the administration of a tax; 2) the Fund is not an entity responsible for administrating taxes; and 3) he did not appear to be affected by Maryland tax laws. The majority disagreed.

First, the Fund was collecting the social security numbers for the administration of a tax. That the Fund passed the numbers to the Comptroller was enough. Because Congress had not defined "administration of a tax," the court used the ordinary meaning of the words - "manag[ing] the operation" of something or putting something "into effect." The Court further stated that this expansive plain meaning definition was consistent with how "tax administration" was applied elsewhere in the comprehensive act as well as the meaning of these same words in the Internal Revenue Code.

Second, the Fund is "an entity that has administrative responsibility for taxes." The majority explained that the statute gave states the power to collect the social security numbers, but the states could only act through their agents. The Maryland Court of Appeals, an agent of Maryland, delegated authority to the Fund to collect the social security numbers.

Finally, the court found that Mr. Tankersley appeared to be affected by Maryland tax law. Although he lived in Virginia and worked in the District of Columbia, Mr. Tankersley appeared to be affected by Maryland tax law because his Maryland bar license gave him the ability to earn income in Maryland.

Judge Davis, in his partial dissent, disagreed with the majority's interpretation of the Tax Reform Act. He also reached the issue of whether the Privacy Act created a Section 1983 right.

Judge Davis explained that Section 405 of the Tax Reform Act should not be interpreted so expansively as to include the Fund's collection of attorney's social security numbers. First, Judge Davis explained that the Fund's collection of social security numbers was not for the purpose of administering a tax, as the Fund was not created for the purpose of administering tax law. Second, the Fund is not an entity that can collect social security numbers because it is not "an agency having administrative responsibility of the law involved." Judge Davis interpreted this language as referring to tax related agencies. Judge Davis also rejected the majority's agency argument stating that the Fund is an agent of the Maryland Court of Appeals not the state. Finally, Judge Davis found that Mr. Tankersley did not appear to be affected by Maryland tax law because he lives in Virginia and practices law in the District of Columbia.

Thus, Judge Davis reached the question of first impression: whether Section 7 of the Privacy Act creates a Section 1983 private right of action. He noted that the Ninth and Eleventh Circuits are split on this issue. Judge Davis found that Tankersley could bring a Section 1983 claim under the Privacy Act. Though the Act does not explicitly confer a private right of action and focuses on what states may not do, it states that individuals have the right not to disclose their social security numbers to government entities. This shows that the Act was intended to benefit people like Mr. Tankersley. Judge Davis found that this right was not too "vague and amorphous" for courts to enforce. Finally, he wrote that nowhere in the Act did Congress foreclose a Section 1983 suit. Thus, Mr. Tankersley had the right to bring a Section 1983 action under the Privacy Act.

The tension between the majority and dissent reflects competing concerns - the government's ability to administer its tax laws against citizen's concerns over the ability of the government to secure their data.

To read the full opinion click here.

Panel:
Circuit Judges Diaz and King, and Senior Circuit Judge Davis

Argument Date:
05/12/2016

Date of Issued Opinion: 09/13/2016

Docket Number: No. 15-1081

Decided:
Affirmed by published opinion

Case Alert Author:
Laura Tallerico, Univ. of Maryland Carey School of Law

Counsel: ARGUED: Scott Matthew Michelman, PUBLIC CITIZEN LITIGATION GROUP, Washington, D.C., for Appellant. Michele J. McDonald, OFFICE OF THE ATTORNEY GENERAL OF MARYLAND, Baltimore, Maryland, for Appellees. ON BRIEF: Julie A. Murray, PUBLIC CITIZEN LITIGATION GROUP, Washington, D.C., for Appellant. Brian E. Frosh, Attorney General, Alexis Rohde, Assistant Attorney General, OFFICE OF THE ATTORNEY GENERAL OF MARYLAND, Baltimore, Maryland, for Appellees.

Author of Opinion:
Circuit Judge Diaz (Majority), Senior Circuit Judge Davis (Concurring in Part, Dissenting in Part)

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/07/2016 04:22 PM     4th Circuit     Comments (0)  

  United States v. White -- Fourth Circuit
Fourth Circuit Vacates Sentence After Supreme Court's Landmark Decision in Johnson v. United States

Areas of Law: Criminal Law; Constitutional Law; Civil Procedure; ACCA; Sentencing

Issues Presented: Whether the district court erred in denying a defendant's motion to suppress evidence when an officer extended a traffic stop after noticing the smell of marijuana while conducting the traffic stop. Whether the district court erred in classifying appellant as a career criminal after the Supreme Court invalidated the residual clause of the Armed Career Criminal Act ("ACCA").

Brief Summary: In a published opinion, the United States Court of Appeals for the Fourth Circuit held that the District Court did not err in denying a motion to suppress evidence because the arresting officer had reasonable suspicion to initiate and extend a traffic stop. However, the Court of Appeals held the District Court did err in sentencing appellant to enhanced punishment as a career criminal under the ACCA after the Supreme Court's decision in Johnson v. United States.

Extended Summary:
On July 9, 2013, Corporal Justin Doughty of the Charleston Police Department was on patrol in Charleston, West Virginia, when he observed a car veer out of its lane. Corporal Doughty pulled over the car to determine whether the driver was impaired. When Corporal Doughty approached the vehicle, he smelled an odor of burned marijuana emanating from the car. Corporal Doughty asked the driver to step out of the car and asked her several questions to determine whether she was impaired and why there was a marijuana odor. Then Corporal Doughty ordered the passengers out of the car to question them about the marijuana odor. During questioning, Corporal Doughty saw a firearm tucked in the side passenger seat where one of the passengers, Desmond Ra'Keesh White, had been sitting. Corporal Doughty placed White under arrest and called for back-up. White admitted the firearm belonged to him.

White was indicted in the United States District Court for the Southern District of West Virginia for being a felon in possession of a firearm, in violation of 18 U.S.C. § 922 (g)(1). White filed a motion to suppress evidence obtained from the traffic stop. The District Court denied the motion after finding reasonable suspicion supported the initial traffic stop because Corporal Doughty witnessed the car veer out of its lane. Additionally, the odor of marijuana provided reasonable suspicion for the extension of the traffic stop and probable cause to search the car where the firearm was recovered. After the denial of the motion, White entered a conditional plea. The agreement allowed White to plead guilty to being a felon in possession of a firearm while retaining his right to appeal the denial of the motion to suppress. During sentencing, White was classified as an armed career criminal under the Armed Career Criminal Act ("ACCA") based on his prior West Virginia state robbery conviction and three prior West Virginia state burglary convictions. White did not object to his classification as a career criminal. The District Court found that White was subject to the ACCA sentence enhancement and sentenced White to the mandatory minimum of 15 years imprisonment. White appealed his sentence and challenged the district court's denial of his motion to suppress.

The Fourth Circuit held that the district court properly denied the motion to suppress, but vacated White's sentence as a result of the Supreme Court's decision in Johnson v. United States.

As to the sentencing issue, White argued that his West Virginia burglary convictions were no longer violent felonies after the Supreme Court invalidated the residual clause of the ACCA. The government contended that White could not challenge his sentence because he had abandoned his claim. The government also maintained on the merits that the West Virginia burglaries qualified as violent felonies under the ACCA's enumerated burglary definition.

Resolving the preservation issue first, the court held that White had not abandoned the right to challenging his sentence by failing to include the claim in his initial brief to the court. As the Fourth Circuit explained, "when an intervening decision of [the] court or the Supreme Court affects precedent relevant to a case pending on direct appeal, an appellant may timely raise a new argument, case theory, or claim based on that decision while his appeal is pending without triggering the abandonment rule." White did not abandon his claim because he did not have the opportunity to bring it up before the Supreme Court's decision in Johnson v. United States, which was issued during the pendency of White's appeal.

The court then turned to consider whether White's prior burglary convictions qualified as violent felonies despite the invalidation of the residual clause of the ACCA. Reviewing the lower court's decision for plain error, the Fourth Circuit found that White needed to show: (1) there was an error; (2) the error was plain; and (3) the error affected substantial rights. In determining whether an error occurred, the Fourth Circuit turned to the Supreme Court's decision in Johnson v. United States. In that case, the Supreme Court held the residual clause of the ACCA is unconstitutionally vague and violates the due process clause. After invalidation of the residual clause, White's prior West Virginia burglary convictions did not qualify as predicate violent felonies under the ACCA. To be considered violent felonies, the West Virginia burglary convictions therefore needed to match the definition of burglary in the ACCA.

The court used the categorical approach to interpret the ACCA and found the West Virginia definition of burglary needed to be the same or narrower than the ACCA-enumerated generic burglary definition to qualify under the definition of burglary in the ACCA. The court found the West Virginia definition of burglary was broader than the generic ACCA definition of burglary, so the burglary convictions did not meet the ACCA definition of burglary. Consequently, White's burglary convictions were not violent felonies under the ACCA and White should not have been considered a career criminal under the ACCA. This error in determining whether White was a career criminal was plain error because the established law clearly determined there was an error. Additionally, the court found this error affected White's substantial rights because he would have received a maximum of 10 years in prison instead of a minimum of 15 years in prison had he been correctly sentenced. The Fourth Circuit vacated White's sentence and remanding the case to the district court for re-sentencing without the enhancement.

To read the full opinion, click here.

* * * * *

In a second case, United States v. Harper, appellant challenged the district court's application of the ACCA based on a finding that his February 1997 offenses constituted multiple ACCA predicate crimes. The Fourth Circuit affirmed the district court's finding, reasoning that the defendant's offenses occurred at different times and in at least three different locations. Notably, the appellant there also argued that the ACCA's requirement that predicates be "committed on occasions different than one another" was unconstitutionally vague under Johnson v. United States, 135 S.Ct. 2551 (2015). The Fourth Circuit rejected this argument, holding that, unlike the ACCA's residual clause in Johnson, the ACCA requirement at issue had a workable standard and thus was not questionable.

To read the full opinion, click here.

Panel: Judges Agee, Wynn, and Schroeder

Argument Date: 03/24/2016

Date of Issued Opinion:
09/09/2016

Docket Number:
15-4096

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

Case Alert Author: Lauren Harrison, Univ. of Maryland Carey School of Law
Counsel: ARGUED: Jonathan D. Byrne, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Charleston, West Virginia, for Appellant. Jennifer Rada Herrald, OFFICE OF THE UNITED STATES ATTORNEY, Charleston, West Virginia, for Appellee. ON BRIEF: Christian M. Capece, Federal Public Defender, Lex A. Coleman, Assistant Federal Public Defender, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Charleston, West Virginia, for Appellant. R. Booth Goodwin II, United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Charleston, West Virginia, for Appellee.
Author of Opinion: Judge Wynn

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/07/2016 04:13 PM     4th Circuit     Comments (0)  

  United States v. Garcia-Lagunas -- Fourth Circuit
Headline: Fourth Circuit Panel Disagrees Over Harm of Ethnically-Charged Evidence

Areas of Law: Evidence, Criminal Law

Issue Presented: Whether the government's use of ethnically-charged evidence to rebut appellant's assertion that he was too poor to have dealt in large quantities of drugs was harmless beyond a reasonable doubt.

Brief Summary: In a published opinion from a panel rehearing, the United States Court of Appeals for the Fourth Circuit affirmed the appellant's conviction for conspiracy to distribute or possess with intent to distribute cocaine, despite finding that the government committed non-constitutional error by using ethnically-charged evidence to rebut the appellant's defense that he was too poor to have dealt drugs in the amounts alleged by the government. The majority found the trial court erred in allowing expert testimony that all "Hispanic drug traffickers" send money they earn in the trade back to their native countries. Nonetheless, the court found the error harmless due to the strength of the government's case against the appellant. The court also remanded the case back to the United States District Court for the Eastern District of North Carolina after vacating the appellant's sentence because of a miscalculation of his Guidelines range. In dissent, Judge Davis vehemently disagreed with the majority's finding of harmless error.

Extended Summary: In 2012, the police arrested Alejandro Garcia-Lagunas in a trailer in rural Robeson County, North Carolina during execution of a search warrant. Police found the appellant inside the trailer with white powder under his nose appearing impaired. The appellant produced $600 in cash from his pocket upon police request, as well as a cell phone which matched a phone number given by the informant as one he used to communicate with his supplier. Later analysis of that phone's records connected it with hundreds of phone calls to multiple known drug dealers, several of whom testified against the appellant pursuant to plea agreements. During their search, in addition to the phone and cash, officers recovered a handgun, small baggies, body armor, digital scales, a small baggie of crack cocaine, and a bag containing 800 grams of a white powdery substance later found to be cocaine.

The appellant was charged with conspiring to distribute or possess with the intent to distribute 500 grams of cocaine and unlawfully reentering the United States after having previously been deported. He pleaded guilty to the charge of unlawful reentry, but proceeded to trial by jury on the drug conspiracy charge. At the trial, the defense elicited testimony on cross-examination as to the poor conditions of the trailer. This testimony was offered in support of the defense theory that the appellant was not a drug trafficker but rather a drug user. On redirect, the detective stated that "he had extensive experience investigating 'Hispanic drug traffickers,' and that 'they're very modest living' because 'they send the majority if not all of the proceeds back to their native countries.'" In response to a defense objection, the government argued that the testimony was relevant to rebut evidence about the poor conditions of the trailer. At the bench, the District Court stated, "I'm not quite sure what the relevance of all of this is, but I do know, based on my experience, that most Latins send money home whether they're drug dealers or not." The District Court then overruled the objection and the detective repeated his testimony to the jury, stating, "It is consistent with Hispanic drug traffickers not to misuse the drug proceeds and to send or get rid of the proceeds, send them to their native countries or their next over them in the drug trafficking organization." This line of testimony was referenced by the government in closing argument to counter the defense's theory of the case. The jury found the appellant guilty.

A pre-sentence investigation report (PSR) added three two-level enhancements to the appellant's criminal responsibility for possession of a dangerous weapon, threatening or directing the use of violence, and obstruction of justice. The defense objected to all the enhancements, but the court only sustained two of those objections. Those two rulings lowered the appellant's offense level to 36, which in turn yielded a Guidelines range of 188 to 235 months' imprisonment. Then, pursuant to an agreement between the appellant and the government relating to a proposed amendment to the Guidelines, the offense level was lowered again to 34, with a Guidelines range of 151 to 188 month's imprisonment. The District Court then sentenced the appellant to 188 months' imprisonment, but stated that it was "impos[ing] a sentence at the low end of the range because this constitutes the defendant's first felony conviction." The District Court also sentenced the appellant to 24 months' imprisonment on the unlawful reentry conviction, to be served consecutively to the sentence on the conspiracy charge.

In holding that the District Court did err, the Fourth Circuit cited the rule that "injection of a defendant's ethnicity into a trial as evidence of criminal behavior is self-evidently improper and prejudicial." United States v. Cruz, 981 F.2d 659, 664 (2nd Cir. 1992). Proceeding then to the harmless error analysis, the court outlined the standard for this inquiry: whether beyond a reasonable doubt a rational jury would have found the defendant guilty absent the error. Neder v. United States, 527 U.S. 1, 18 (1999).

The court found that a rational jury would have arrived at the guilty verdict even absent the error beyond a reasonable doubt because of the strength of the evidence introduced by the government at trial: the quantity of the drugs involved in the conspiracy, the voluminous phone records, circumstantial physical evidence found at the scene, and the testimony of multiple corroborative drug dealers. Unlike cases in which courts ruled that evidentiary errors were not harmless, the Fourth Circuit found that "what [the appellant] did with his earnings from the drug trade was not an element of the prosecution's case against him." The court also stated that "although the government repeated the offensive stereotype in its closing argument, the improper evidence did not pervade the trial." Finally, the court held that "the challenged testimony did not open the door to the admission of further damaging evidence that would otherwise not have come in."

Regarding the appellant's challenge to his sentence, the court reviewed the contentions for plain error. The court found that the District Court had committed such error by miscalculating his offense level. Although the District Court stated it would impose a sentence at the low end of the range, it did so from the wrong range by failing to take into account one of the sustained objections. Furthermore, the Fourth Circuit found this error affected the appellant's substantial rights because it added roughly three years of imprisonment to his sentence.

Judge Davis dissented from the majority opinion as to the harmless error holding. In Judge Davis' view, the Government failed to prove beyond a reasonable doubt that the ethnically charged generalization did not contribute to the jury's verdict. Judge Davis found merit in the evidence put forth by the defense that the defendant was too poor to have committed this large-scale conspiracy and stated that there were two compelling narratives in front of the jury. He found such competing narratives were the natural course for many trials and the government should not have the benefit of "blatantly foul blows...abetted by the trial judge, in the use of racial or ethnic entreaties aimed at undermining or dismissing outright the defense theory of the case." Judge Davis found this evidence to be quite persuasively used by the government in closing argument, as evidenced by the persuasive effect it had on the trial judge. Judge Davis wrote, "At a moment in our country's history when uncommon attention is being paid to issues of racial and ethnic stereotyping and consequent mistreatment, actual or threatened, this Court chooses to privilege the Government to employ, without consequence, irrelevant, prejudicial, and factually unwarranted evidence of blatant racial stereotyping to obtain a criminal conviction. In this moment, not even the ethnic heritage of distinguished federal judges is beyond trashing in the public sphere, and by a prominent candidate for the most powerful office on the planet, no less."

To read the full opinion, click here.

Panel: Judges Duncan and Diaz, and Senior Judge Davis

Argument Date: 09/17/2015

Date of Issued Opinion: 09/01/2016

Docket Number: No. 14-4370

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

Case Alert Author: Patrick J.L. Dillon, University of Maryland Carey School of Law

Counsel: ARGUED: Paul K. Sun, Jr., ELLIS & WINTERS, LLP, Raleigh, North Carolina, for Appellant. Kristine L. Fritz, OFFICE OF THE UNITED STATES ATTORNEY, Raleigh, North Carolina, for Appellee. ON BRIEF: Kelly Margolis Dagger, ELLIS & WINTERS, LLP, Raleigh, North Carolina, for Appellant. Thomas G. Walker, United States Attorney, Jennifer P. May-Parker, Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Raleigh, North Carolina, for Appellee.

Author of Opinion: Judge Diaz

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/07/2016 03:38 PM     4th Circuit     Comments (0)  

  Lund v. Rowan County, North Carolina -- Fourth Circuit
Headline: Lawmaker-Led Prayer at Public Board of Commissioners Meeting Constitutionally Permissible

Areas of Law: Constitutional Law

Issue Presented: Whether lawmaker-led invocations at a town Board of Commissioner's meeting violated the First Amendment.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held the lawmaker-led opening prayer at every Board of Commissioner meeting was permissible under the First Amendment because it was not coercive and lawmaker-led prayer has a rich history and tradition in both Congress and state legislatures.

Extended Summary: Rowan County, North Carolina opens their Board of Commissioners public meetings with Christian, lawmaker-led invocations. Appellees, a group of non-secular and non-Christian community members, challenged the Board's practice as a violation of the Establishment Clause of the First Amendment. They filed suit in the U.S. District Court for the Middle District of North Carolina because the prayer practice 1) unconstitutionally affiliated the Board with one particular faith - Christianity, and 2) coerced appellees into participating in the invocation as a condition of attendance. The District Court held that given then-controlling precedent, the lawmaker-led prayer made legislators impermissible "supervisors of prayer." The District Court acknowledged that the Supreme Court's Town of Greece decision, which upheld the introductory prayer at issue in that case, "dismantled" the Fourth Circuit's legislative prayer doctrine. Nonetheless, the District Court found a number of factual distinctions justified a result different from Town of Greece. In particular, the court emphasized that in the instant case the commissioners delivered the prayers, as opposed to clergy, deviating from the long-standing tradition of using a chaplain. Further, the District Court stressed that the Board's practice created a "closed universe of prayer-givers" that "inherently discriminates and disfavors religious minorities."

The Fourth Circuit reversed the judgment of the District Court and remanded with directions. The court analyzed the Supreme Court's 2014 decision in Town of Greece v. Galloway and held that lawmaker-led prayer is a historical practice that the country accepts and that the Board's practices did not implicate the concerns articulated in Town of Greece for finding invocations coercive. Further, the Fourth Circuit concluded that the lawmaker-led prayer was similar to that of the clergy-led prayer at issue in Town of Greece.

In a dissent, Judge Wilkinson discussed the conceptual differences between Town of Greece and the instant case. He noted that legislator-led prayer is the very embodiment of the state. Judge Wilkinson also highlighted several concerns with the Board of Commissioners in Rowan County, most importantly the fact that from November 2007 to the beginning of the lawsuit in March 2013, 139 out of 143 meetings began with legislators delivering prayers that explicitly referenced Christianity.

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

Panel: Judges Agee, Wilkinson, and Shedd

Argument Date: 01/27/2016

Date of Issued Opinion:
09/19/2016

Docket Number:
No. 15-1591

Decided: Reversed and Remanded by Published Opinion

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

Counsel: Allyson Newton Ho, MORGAN, LEWIS & BOCKIUS LLP, Dallas, Texas, for Appellant. Christopher Anderson Brook, AMERICAN CIVIL LIBERTIES UNION OF NORTH CAROLINA, Raleigh, North Carolina, for Appellees.

Author of Opinion: Judge Agee

Case Alert Supervisor: Professor Renee Hutchins

    Posted By: Renee Hutchins @ 11/07/2016 03:25 PM     4th Circuit     Comments (0)  

  Ghazzaoui v. Anne Arundel County, et al. -- Fourth Circuit
Headline: The Little Pro Se Litigant that Could: Fourth Circuit Rules that District Court Should Resolve Claims of Excessive Force and False Arrest

Areas of Law: Constitutional Law, Civil Procedure, Civil Law

Issue Presented: Whether the district court erred in granting the defense motion for summary judgment or erred in denying the plaintiff's motion for recusal.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held the district court improperly dismissed Ramez Ghazzaoui's excessive force and false arrest claims against Officer Dwayne Raiford because the parties disputed material issues of fact. The Fourth Circuit found the competing account of events, photographs, and video evidence was sufficient to send the case to a jury. The Fourth Circuit also remanded the case back to the district court because the court failed to rule on Ghazzaoui's claim that police unreasonably searched his bedroom. The court upheld the summary judgment motion again Corporal Doyle Holquist because he was not present at the start of the altercation and only assisted Raiford with the arrest. The court also dismissed Ghazzaoui's motion for recusal and request for a different judge, finding the request was unfounded.

Extended Summary:
Ramez Ghazzaoui filed a complaint alleging that police used excessive force and falsely arrested him after an altercation in Ghazzaoui's home. In the original complaint, Ghazzaoui claimed that on April 26, 2013, Officer Dwayne Raiford and Corporal Doyle Holquist entered his home shortly before midnight, after a community security guard notified the police, that Ghazzaoui's garage door was open. Ghazzaoui alleges that while he was sleep, police officers searched the first floor of his home before going to the second floor of the home where police found Ghazzaoui sleeping. In the complaint, Ghazzaoui says the officers requested to see his identification. However, once he produced his Maryland Driver's License the officers did not leave the home.

After an altercation with police, Ghazzaoui was arrested, and charged with: obstructing a police officer in the performance of his lawful duties, resisting arrest, failing to obey orders, and injuring a law enforcement officer engaged in the performance of his duties. All the charges were resolved in Ghazzaoui's favor. Ghazzaoui's complaint alleged he was falsely arrested, and police used excessive force in violation of 42 U.S.C § 1983, the Maryland Declaration of Rights, and Maryland tort law. The district court granted the defense motion for summary judgment and dismissed all of Ghazzaoui's claims.

The United States Court of Appeals for the Fourth Circuit, reviewing Ghazzaoui's excessive force claims de novo, found the district court correctly dismissed some claims on summary judgment, but improperly dismissed the entire suit. The Fourth Circuit analyzed the force a police officer uses under the Fourth Amendment's objective reasonableness standard to determine if the force was excessive. The Fourth Circuit ruled that the excessive force claim against Holquist could not survive summary judgment because Holquist only assisted Raiford with the arrest and did not see the initial altercation.

However, the court held that Ghazzaoui's excessive force claims against Raiford should proceed to a jury. Ghazzaoui contended that he complied with the officer's command to sit down, but was still thrown against a wall and then to the floor smashing his head on the ground, before he was arrested. Raiford contended that Ghazzaoui poked him with a pen, disobeyed orders to sit down, and fell to the ground while resisting arrest. The Fourth Circuit found the competing accounts of what happened, paired with photographs supporting Ghazzaoui's version of events, meant the disputed facts at issue should be resolved by a jury, not on summary judgment.

The Fourth Circuit also concluded that the district court improperly dismissed Ghazzaoui's false arrest claim on summary judgment. Under Maryland law, a false arrest claim can only survive summary judgment if the plaintiff can prove there was no probable cause for the arrest. Under Maryland law, a conviction is sufficient to prove probable cause, even if the judgment is reversed. However, Maryland law also recognizes that a conviction does not demonstrate probable cause if it was obtained by fraud, perjury, or other corrupt means. Similarly, under federal law, a § 1983 false arrest claim requires the plaintiff to establish the defendant caused the arrest without probable cause and that all the criminal charges were resolved in the plaintiff's favor. The Fourth Circuit noted that Ghazzaoui had photographs, and video footage that may suggest he was falsely arrested and that Raiford may have perjured himself in state court. Therefore, the Fourth Circuit ruled that Ghazzaoui's claim should proceed to a jury.

Finally, the Fourth Circuit found the district court ruling on the summary judgment motion did not address Ghazzaoui's claim that police conducted an unreasonable search of his bedroom. While Ghazzaoui won most of his claims on appeal regarding his summary judgment, the Fourth Circuit quickly dismissed his motion for a new judge, finding that Ghazzaoui's request for recusal based on claims of bias and corruption were unfounded.

To read the full opinion, click here.

Panel: Judges Niemeyer, Shedd, and Harris

Argument Date: 8/26/2016

Date of Issued Opinion: 9/8/16

Docket Number:
No. 15-2581

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

Case Alert Author: Fernando Kirkman, Univ. of Maryland Carey School of Law

Counsel:
Ramez Ghazzaoui, Appellant Pro Se. Hamilton F. Tyler, ANNE ARUNDEL COUNTY OFFICE OF LAW, Annapolis, Maryland, for Appellees.

Author of Opinion:
Per Curiam

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/07/2016 02:05 PM     4th Circuit     Comments (0)  

  Calobrisi v. Booz Allen Hamilton, Inc. -- Fourth Circuit
Headline: Age or Gender Discrimination at Work? Me Too. Fourth Circuit Joins Six Circuit in Considering "Me-Too" Evidence with Griffin Factors

Areas of Law: Employment Law, Anti-Discrimination Law, Evidence

Issue Presented: Whether a court should analyze the admissibility of each piece of "other employee" evidence pursuant to Griffin factors when determining whether an employer's stated reason for demotion is a pretext for discrimination.

Brief Summary: The United States Court of Appeals for the Fourth Circuit reversed the District Court's grant of summary judgment to the defendant on discrimination and constructive discharge claims because the District Court failed to consider the plaintiff's proffered "other employee" evidence. The Fourth Circuit held that, to determine whether the defendant's stated reason for the plaintiff's demotion was a pretext for discrimination, the district court should have analyzed the admissibility of each piece of the "other employee" evidence pursuant to Griffin factors, and should have examined how closely related the "other employee" evidence was to the plaintiff's circumstances and theory of the case, as mandated by Sprint.

Extended Summary: If a plaintiff brings an employment discrimination claim under the McDonnell Douglas burden-shifting framework, the analysis proceeds in three steps. First, the plaintiff has the burden of establishing a prima facie employment discrimination case. Second, the employer must articulate a legitimate, non-discriminatory reason for taking the adverse employment action at issue. Third, the burden shifts back to the plaintiff to show that the stated reason for the adverse employment action is pretext for a discriminatory purpose. At the third step of the analysis, the plaintiff may help to establish pretext by offering "other employee" evidence. "Other employee" evidence is evidence that other similarly situated employees have allegedly encountered adverse employment actions similar to those that the plaintiff experienced.

As explained in Sprint/United Mgmt. Co. v. Mendelsohn, 552 U.S. 379 (2008), a court must examine the admissibility of each piece of the "other employee" evidence - if the evidence is relevant under Rule 401, and, if so, whether it should nevertheless be excluded under Rule 403. The question of whether the "other employee" evidence is relevant is fact-based and depends on many factors, including how closely related the evidence is to the plaintiff's circumstances and theory of the case.

Carla Calobrisi ("Carlobrisi"), a 55 year-old female Principal of Booz Allen Hamilton, Inc. ("Booz Allen"), was demoted to Senior Associate "due to workload," and many of her responsibilities were transferred to two younger women. After Calobrisi raised concerns that her demotion was the result of age and gender discrimination, her supervisor suggested that she leave Booz Allen. Calobrisi soon left Booz Allen, and her position was filled by a 31-year-old male.

Calobrisi filed a lawsuit against Booz Allen in the District of Columbia Superior Court, alleging sex-based discrimination under Title VII of the Civil Rights Act, aged-based discrimination under the Age Discrimination in Employment Act, and retaliation claims. Booz Allen removed the case to the United States District Court for the District of Columbia, and the case was then transferred to the United States District Court for the Eastern District of Virginia. The District Court granted summary judgment to Booz Allen on the retaliation and discrimination claims. With respect to the discrimination claims, the only contested issue was the third step under the McDonnell Douglas framework, i.e., whether Calobrisi produced sufficient evidence for a jury to conclude that the stated reason for her demotion was a pretext for a discriminatory purpose. Calobrisi alleged that Booz Allen maintained a glass ceiling that prevented female employees, particularly those who were older or in higher ranking positions, from advancing. To support this theory, Calobrisi offered "other employee" evidence, which included the testimony of seven middle-aged female former Booz Allen employees. The employees contended that they had been targeted for adverse employment actions similar to those that Calobrisi experienced. The District Court, however, summarily concluded this evidence would not be admissible at trial and refused to consider it when ruling on summary judgment.

The Fourth Circuit reversed the grant of summary judgment on the discrimination claims. Citing a Sixth Circuit case, Griffin v. Finkbeiner, 689 F.3d 584 (6th Cir. 2012), the Fourth Circuit held that a court should consider the Griffin factors in determining the admissibility of "other employee" evidence. The Griffin factors include: (1) whether the other discriminatory behavior described is close in time to the events at issue in the case; (2) whether the same decision-makers were involved; (3) whether the witness and plaintiff were treated in a similar manner; and (4) whether the witness and plaintiff were otherwise similarly situated. The Fourth Circuit found the District Court did not individually analyze the admissibility of each piece of the "other employee" evidence pursuant to these Griffin factors. Moreover, the Fourth Circuit reasoned that the District Court's one-sentence admissibility analysis ignored both the similar treatment experienced by Calobrisi and other employee witnesses, and the overlap of several decision-makers at Booz Allen. Thus, the Fourth Circuit found the District Court failed to determine how closely related the "other employee" evidence was to Calobrisi's circumstances and theory of the case, as mandated by Sprint.

The Fourth Circuit remanded the case to the District Court to determine the admissibility of Calobrisi's proffered "other employee" evidence. In particular, the Fourth Circuit suggested that some of the other employees' testimony "appear[ed] relevant" based on the common decisionmakers involved in the witnesses' departures and the similarities of the departures' circumstances. For example, members of Booz Allen's all-male leadership team triggered several of the departures, and each departure featured an abrupt demotion or revocation of responsibilities after years of positive reviews.

To read the full opinion, click here.

Panel: Chief Judge Gregory, Judges Motz and Keenan

Argument Date: 03/24/2016

Date of Issued Opinion: 08/23/2016

Docket Number: No. 15-1331 and No. 15-1399

Decided: Affirmed in part; vacated and remanded in part with instructions by unpublished per curiam opinion.

Case Alert Author: Maria Nazarova, Univ. of Maryland Carey School of Law
Counsel: Linda Marie Correia, CORREIA & PUTH, PLLC, Washington, D.C., for Appellant/Cross-Appellee. Stephen William Robinson, MCGUIREWOODS LLP, Tysons Corner, Virginia, for Appellee/Cross- Appellant. ON BRIEF: Amber C. Trzinski Fox, Jonathan C. Puth, CORREIA & PUTH, PLLC, Washington, D.C.; John R. Ates, ATES LAW FIRM, Alexandria, Virginia, for Appellant/Cross-Appellee. Melissa L. Taylormoore, Sarah A. Belger, MCGUIREWOODS LLP,Tysons Corner, Virginia, for Appellee/Cross-Appellant. Daniel B. Kohrman, Laurie A. McCann, Dara S. Smith, AARP FOUNDATION LITIGATION, Washington, D.C., for Amicus Curiae.
Author of Opinion: Per curiam

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/07/2016 11:48 AM     4th Circuit     Comments (0)  

  United States v. Alfaro - Fourth Circuit
Headline: Fourth Circuit Broadly Defines "Forcible Sex Offense" Under Sentencing Guideline 2L1.2

Area(s) of Law: Criminal Law, Immigration Law, Sentencing Guidelines

Issue Presented: Whether appellant's previous conviction of third degree sexual offense under § 3-307 of the Maryland Code constitutes a crime of violence under § 2L1.2 of the U.S. Sentencing Guidelines.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that the district court properly found appellant's prior conviction of third degree sexual offense qualified as a crime of violence under the Sentencing Guidelines.

Extended Summary: Osmin Alfaro entered the United States illegally from El Salvador when he was a teenager. In 2003, Alfaro was convicted of third-degree sexual offense under § 3-307(a)(1) of the Maryland Code for sexually assaulting his then-estranged wife. Alfaro was deported in 2008 after failing to register as a sex offender in Maryland. He illegally re-entered the country in 2010. In 2014, he came to the attention of federal authorities and pled guilty to failing to register as a sex offender and illegal re-entry. The district court applied a 16-level sentencing enhancement after concluding that Alfaro's prior felony conviction of third-degree sexual assault qualified as a crime of violence - forcible sex offense - and sentenced him to 46 months' imprisonment.

On appeal, Alfaro challenged the district court's decision, arguing that while his offense was "forcible," it did not amount to a crime of violence because it did not qualify as a sex offense. Alfaro argued that for his conviction to qualify as a forcible sex offense under the Guidelines, the statute must require that the prohibited conduct be committed with an intent to gratify sexual urges. Because § 3-307(a)(1) can be violated with an intent to abuse, his conviction was not a crime of violence as defined by the Guidelines, Alfaro argued.

The court disagreed and determined that an intent to abuse was sufficient for a "forcible sex offense" and defined "sex offense" as an offense involving sexual conduct with another person. Applying a modified categorical approach, the court looked to the plain, ordinary meaning of the language used in the Guidelines to determine whether Alfaro's conviction qualified as a "forcible sex offense." The court reasoned that because "forcible sex offense" is not a traditional common-law crime, it would be "difficult, if not impossible" to employ the categorical approach of surveying the states' criminal codes to determine if Alfaro's prior conviction met the criteria of a crime of violence.

The court determined that "sex offense" simply refers to criminal offenses involving sexual conduct and reasoned that the Sentencing Commission purposefully did not limit crimes of violence to rape, but rather included all sexual offenses that are forcibly committed. Further, the court argued, the Commission's decision to resolve a circuit split and amend the Guideline to clarify that a sex offense may be forcible in the absence of physical force supports an expansive definition of "sexual offense" instead of the restrictive one Alfaro sought to apply. The court joined other circuits in defining the "sex offense" portion of "forcible sex offense" very broadly. Ultimately, the court held the district court did not err by treating Alfaro's prior conviction as a "forcible sex offense" under the Guidelines and affirmed his sentence.

To read the full opinion, click here.

Panel: Judges Traxler, Shedd, and Floyd

Argument Date: 03/24/2016

Date of Issued Opinion: 08/29/2016

Docket Number: No. 15-4102

Decided: Affirmed by published opinion

Case Alert Author:
Yvette Pappoe

Counsel: ARGUED: Paresh S. Patel, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Greenbelt, Maryland, for Appellant. James I. Pearce, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee. ON BRIEF: James Wyda, Federal Public Defender, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Baltimore, Maryland, for Appellant. Leslie Caldwell, Assistant Attorney General, Sung-Hee Suh, Deputy Assistant Attorney General, Criminal Division, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C.; Rod J. Rosenstein, United States Attorney, Baltimore, Maryland, Sujit Raman, Chief of Appeals, OFFICE OF THE UNITED STATES ATTORNEY, Greenbelt, Maryland, for Appellee.

Author of Opinion:
Judge Traxler

Case Alert Supervisor:
Professor Renée Hutchins

    Posted By: Renee Hutchins @ 11/07/2016 11:20 AM     4th Circuit     Comments (0)  

  Friends of The East Hampton Airport, Inc. v. Town of East Hampton
Headline: Second Circuit Enjoins Three East Hampton Airport Noise-Control Laws

Area of Law: Aviation Law

Issue(s) Presented: Whether a town must comply with the procedural requirements of the Airport Noise and Capacity Act when enacting new laws for its airport, even if it is willing to forgo future federal funding for the airport.

Brief Summary: In order to reduce airport noise at its local public airport, the Town of East Hampton passed three laws: (1) a mandatory curfew on airport use from 11:00 p.m. to 7:00 a.m.; (2) an extended curfew on noisy aircrafts from 8:00 p.m. through 9:00 a.m.; and (3) a one round-trip limit-per- week on noisy aircrafts' airport use during a particular season. A group of plaintiffs, consisting of aviation businesses that use the East Hampton Airport, filed suit in the United States District Court for the Eastern District of New York, seeking an injunction against the enforcement of these laws. The district court enjoined one of the three laws, and both sides appealed. The Second Circuit ruled that all three laws should be enjoined because East Hampton had enacted them without complying with the procedural requirements of the Airport Noise and Capacity Act of 1990. The court rejected East Hampton's argument that it could avoid those requirements by disavowing future federal funding. To read the whole opinion, please visit http://www.ca2.uscourts.gov/de...a5bc5a7cdb6/2/hilite/

Extended Summary: The Town of East Hampton owns and operates the East Hampton Airport, which has both domestic and international flights. Aside from public use, the airport also serves thousands of private aircraft flights. Over the years, town residents complained about the noise emanating from the airport.

In 2014, the Town held public meetings and conducted a three-phase study, focusing on the main sources of the airport noise and determining which times of the year generated the most noise complaints from town citizens. As a result, the Town enacted three new laws: (1) a mandatory curfew on airport use from 11:00 p.m. to 7:00 a.m. (2) an extended curfew on noisy aircrafts from 8:00 p.m. through 9:00 a.m. (3) a one round-trip limit-per- week on noisy aircrafts' airport use during a particular season. In so doing, the Town did not comply with the procedural requirements of the Airport Noise and Capacity Act of 1990 ("ANCA"), which established a "national aviation noise policy" that applied to aircraft noise restrictions.

On April 21, 2015, five days after the Town enacted the laws, various aviation businesses filed suit in the U.S. District Court for the Eastern District of New York against the Town for declaratory and injunctive relief. Specifically, the businesses sought to prevent enforcement of the laws, arguing that the laws violated the ANCA's procedural requirements. The district court enjoined enforcement of one of the laws, and both sides appealed.

At the outset, the Second Circuit found that the aviation businesses had equitable jurisdiction to challenge the Town's laws. The court then concluded that all three laws should be enjoined, because the ANCA's procedural requirements - which the Town acknowledged had not been followed--applied to any public airports, regardless of federal funding status. The Town's disavowal of future federal funding for the airport was thus irrelevant. The court also looked outside of the statute's text, finding that legislative history and other regulations also mandated the same result. Congress was concerned with the uncoordinated response to airport noise complaints, which led Congress to regulate noise control at the national level. Thus, since the laws did not comply with ANCA's procedures, they were federally preempted and subject to the preliminary injunction sought by the plaintiffs.

Panel: Circuit Judges Jacobs, Calabresi, and Raggi

Argument Date: 06/20/16

Date of Issued Opinion: 11/04/16

Docket Number: Nos. 15-2334-cv(L), 15-2465-cv(XAP)

Decided: Affirmed in part, vacated in part, and remanded

Case Alert Author: Samantha Hazen

Counsel: Kathleen M. Sullivan, W. Eric Pilsk, Kaplan, Kirsch & Rockwell, LLP, David M. Cooper, Quinn Emanuel Urquhart & Sullivan, LLP, for Defendant-Appellant-Cross Appellee, Lisa R. Zornberg, Helen A. Gredd, Jonathan D. Lamberti, Lankler Siffert & Wohl LLP, for Plaintiffs-Appellees-Cross-Appellants, Lauren L. Haertlein, General Aviation Manufacturers Association, Amicus Curiae in support of Plaintiffs-Appellees-Cross-Appellants

Author of Opinion: Circuit Judge Raggi

Case Alert Circuit Supervisor: Professor Emily Gold Waldman

    Posted By: Emily Waldman @ 11/07/2016 09:57 AM     2nd Circuit     Comments (0)  

November 4, 2016
  United States v. Hector Soto-Zuniga - Ninth Circuit
Headline: The Ninth Circuit panel held that the district court abused its discretion by denying defendant pretrial discovery of the arrest and search statistics of the San Clemente Border Patrol checkpoint to prove that the checkpoint is unconstitutional because its primary purpose is to detect evidence of drug trafficking, rather than to control immigration, and

Areas of Law: Criminal Law, Fourth Amendment, Criminal Procedure, Pre-Trial Discovery

Issues Presented: Whether the district court abused its discretion in denying defendant's discovery motion for San Clemente's checkpoint search and arrest statistics in order to determine the constitutionality of the checkpoint which turns on whether its "primary purpose" is to control immigration or rather to interdict drug trafficking and other "ordinary criminal wrongdoing."

Whether the district court erred in its finding that defendant's discovery request for the government's investigation into Christian Rios Campos' drug smuggling operation was not material to his defense and was therefore not discoverable.

Whether the district court erred in denying defendant's motion to suppress the drug evidence on the basis that the Border Patrol agents lacked probable cause to search defendant's car.

Whether the district court erred in instructing the jury, using the Ninth Circuit pattern jury instructions, that "[a] reasonable doubt is a doubt based upon reason and common sense and is not based purely on speculation" because this phrasing interferes with the presumption of innocence.

Whether defendant's knowledge of drug type and quantity is an element of possession with intent to distribute in violation of 21 U.S.C § 841.

Significance: Border Patrol checkpoints have long been a clear exception to the Fourth Amendment prohibition of unreasonable searches and seizures. However, the Supreme Court emphasized, in City of Indianapolis v. Edmond, that it had never approved a checkpoint program whose primary purpose was to detect evidence of ordinary criminal wrongdoing as opposed to policing the border or ensuring roadway safety. Here, the Ninth Circuit panel affirmed that the primary purpose of border patrol checkpoints should be to control immigration and not to interdict drug trafficking and, therefore, defendant has the right to discover the checkpoint's arrest statistics.

Brief Summary: Hector Soto-Zuniga ("Soto-Zuniga") was arrested at a Border Control checkpoint in San Clemente, California after Border Patrol agents found 2.9 kilograms of methamphetamine on the floor of Soto-Zuniga's car during a search. On a defense motion to suppress drug evidence seized from defendant's car at the checkpoint, Soto-Zuniga argued that the San Clemente checkpoint was unconstitutional and requested discovery of the checkpoint's arrest and search statistics. The district court denied Soto-Zuniga's motions to suppress.

Soto-Zuniga testified that, prior to being stopped at the San Clemente checkpoint, he gave a ride to three teenagers whom he did not know as a favor to his cousin's husband, Christian Rios Campos ("Rios"). The government stipulated that Rios was a drug smuggler who was known to recruit juveniles to smuggle drugs into the United States, which was significant to Soto-Zuniga's defense that the teenagers had planted the drugs in his car without Soto-Zuniga's knowledge. Soto-Zuniga moved to discover the government's investigation into Rios's drug smuggling operation on grounds that such discovery might identify the three teenagers. The district court denied Soto-Zuniga's motion and Soto-Zuniga was convicted and sentenced to six years in prison.

On appeal, the Ninth Circuit panel held that: (1) the district court abused its discretion by denying Soto-Zuniga's discovery request for the search and arrest statistics of the San Clemente border checkpoint, concluding that discovery of the checkpoint's search and arrest statistics was pertinent to the issue whether the checkpoint was unconstitutional under the Fourth Amendment because its primary purpose was to advance the general interest in crime control rather than to control immigration; and (2) the district court abused its discretion by finding that the documents gathered during the government's investigation into Rios's drug smuggling operation were not material to the defense and were, therefore, not discoverable because they were inadmissible evidence. The panel concluded that there exists a likelihood that discovery of these documents would have identified the teenagers and changed the outcome of the trial.

Extended Summary: Appellant Hector Soto-Zuniga ("Soto-Zuniga") was arrested at a Border Control checkpoint in San Clemente, California after Border Patrol agents found 2.9 kilograms of methamphetamine on the floor of Soto-Zuniga's car during a search. Soto-Zuniga was charged with possession of methamphetamine with intent to distribute in violation of 21 U.S.C. § 841(a)(1).

Before trial, Soto-Zuniga filed a motion to suppress the drugs seized from his car on grounds that they were the fruits of an unlawful search and seizure because the Border Patrol agents at the San Clemente checkpoint lacked probable cause to detain him and search his car. In an unsuccessful attempt to support his motion to suppress, Soto-Zuniga also filed a motion which sought discovery of statistics relating to the number and types of arrests and vehicle searches at the San Clemente checkpoint.

The district court held an evidentiary hearing on Soto-Zuniga's pretrial motions during which Border Patrol Agent Rabreau ("Rabreau") testified that the primary purpose of the San Clemente checkpoint was immigration inspection and that ninety percent of the arrests made were related to immigration. Rabreau further testified as to the events that led to Soto-Zuniga's arrest including that the smell of marijuana coming from Soto-Zuniga's car was the reason Border Patrol Agent Favela ("Favela") initially sent Soto-Zuniga to secondary inspection at the San Clemente checkpoint.

Notwithstanding Soto-Zuniga's sworn declaration and testimony that Soto-Zuniga had not smoked marijuana in more than five years, the district court denied defendant's motions to suppress and compel discovery on grounds that: (1) the sequence of events in the Border Patrol Agents' reports were consistent; (2) there was probable cause based on several factors, including the smell of marijuana, Soto-Zuniga's reported nervousness, the air fresheners, the loose tobacco, the cigarillo wrappers, and Agent Rodgers's report that Soto-Zuniga admitted to him that he had smoked marijuana in the car; (3) while Agent Rabreau was the only agent who claimed to smell the marijuana, other agents reported that Agent Rabreau had told them he smelled marijuana at the scene so it was not "a post-arrest revelation; and (4) Rabreau's testimony was sufficient to lead the district court conclude that the San Clemente checkpoint's primary purpose was immigration.

During the first trial, Soto-Zuniga sought specific jury instructions that differed from the Ninth Circuit pattern jury instructions on reasonable doubt. The district court rejected defendant's jury instructions in favor of the pattern jury instructions. Soto-Zuniga's first trial resulted in a mistrial because the jury was unable to reach a unanimous verdict.

Before the second trial, Soto-Zuniga requested discovery of the government's investigation of Rios and Marisol Diaz ("Diaz"), including any relevant information regarding the three teenagers who were arrested for trafficking drugs at Rios's command. The district court denied defendant's motion to compel discovery on grounds that the evidence was: (1) collateral, (2) irrelevant, and (3) predominately inadmissible in their current form. The district court further ruled that the requested discovery would extend the litigation and present a Fed. R. Civ. P. 403 problem as well. Following the end of the second trial, the jury was instructed with the same jury instructions used in the first trial and the jury returned a guilty verdict.

The Ninth Circuit panel reviewed the district court's discovery rulings for abuse of discretion. To reverse Soto-Zuniga's conviction, the panel must find that the district court abused its discretion in denying Soto-Zuniga's discovery motions and that the error resulted in prejudice to Soto-Zuniga's substantial rights (i.e., that there was "a likelihood that the verdict would have been different had the government complied with the discovery rules").

The first issue on appeal was whether the district court abused its discretion by denying defendant's motion for discovery of the San Clemente checkpoint's search and arrest statistics. The panel held that the district court abused its discretion because this information could have revealed an unconstitutional seizure and lead to the suppression of the evidence of illicit drugs that were found in appellant's car.

The panel acknowledged that, while a search or seizure is unreasonable unless it rests on individualized suspicion of wrongdoing, there is an exception for checkpoint seizures that serve "special needs beyond the normal need for law enforcement" (see City of Indianapolis v. Edmond, 531 U.S. 32, 37 (2006), provided that the purpose of the checkpoint was actually immigration control; (see United States v. Martinez-Fuerte, 428 U.S. 543, 556-64 (1976) (holding that immigration control is a valid purpose for stopping cars and posing questions without individualized suspicion)).

Because the primary purpose of checkpoints should not be to advance the general interest in crime control, the constitutionality of the San Clemente checkpoint turns on whether its "primary purpose" is either to control immigration or to interdict drug trafficking and other "ordinary criminal wrongdoing." Edmond, 531 U.S. at 41. If the checkpoint's primary purpose is to further the general interest in crime control, the checkpoint is per se invalid under the Fourth Amendment and evidence recovered from the illegal search must be excluded as fruit of the poisonous tree. Wong Sun v. United States, 371 U.S. 471, 487-88 (1963).

Accordingly, the Ninth Circuit panel held that, "[w]hether the primary purpose of the checkpoint has evolved from controlling immigration to detecting 'ordinary criminal wrongdoing,' is a question that is subject to discovery under Rule 16" and Soto-Zuniga should not have to rely solely on the government's word that further discovery is unnecessary. Therefore, defendant has a right to discover the statistics of the number and type of arrests and vehicle searches at the San Clemente checkpoint on grounds that such evidence would have provided Soto-Zuniga with the opportunity to support his declaration that the checkpoint was used as a pretext to search for controlled substances rather than to control illegal immigration.

Since the records in question were not available to the Ninth Circuit panel, it could not determine the likelihood whether Soto-Zuniga's case would have had a different outcome had discovery been permitted. Thus, the panel reversed the district court's denial of the motion to compel discovery of the San Clemente checkpoint's arrest statistics and remanded to the district court to assess the constitutionality of the San Clemente checkpoint in further proceedings.

The second issue on appeal was whether the district court abused its discretion by denying Soto-Zuniga's motion requesting discovery of the government's investigation into Rios's drug smuggling operation. The panel held that the district court abused its discretion in concluding that the documents were irrelevant, inadmissible because they relied on hearsay, and that the requested discovery would unnecessarily extend the litigation in violation of Fed. R. Evid. 403. Adopting a broad interpretation of Rule 16(a) (1) (E) that entitled Soto-Zuniga to discover documents that are "material to preparing the defense," the panel explained that "[t]he test is not whether the discovery is admissible at trial, but whether the discovery may assist Soto-Zuniga in formulating a defense, including leading to admissible evidence." The panel concluded that the district court erred by finding that the documents were not material to the defense because they were not admissible since they would either corroborate or contradict Soto-Zuniga's defense that one or more of the teenagers placed the drugs in Soto-Zuniga's car without his knowledge. The panel therefore reversed the district court's denial of Soto-Zuniga's discovery motion, vacated the conviction and remanded with instructions to grant the motion.

The third issue on appeal was whether the district court erred in denying Soto-Zuniga's motion to suppress the drug evidence on the basis that the Border Patrol Agents lacked probable cause to search the car. The panel asserted that certainty is not required to support a search or seizure, but only probable cause based on a totality of the circumstances that a search may yield evidence of a crime: "Probable cause exists if there is a fair probability that contraband or evidence of a crime will be found in a particular place based on a totality of the circumstances." The panel held that, based on Soto-Zuniga's nervousness, agitation, and at least one agent's report that Soto-Zuniga had been smoking marijuana and saw marijuana paraphernalia in the car, "the district court's account of the evidence is plausible and that the totality of the circumstances supported probable cause for the search."

The fourth issue on appeal was whether the district court erred by instructing the jury using the Ninth Circuit pattern jury instructions, which stated that "[a] reasonable doubt is a doubt based upon reason and common sense and is not based purely on speculation." Soto-Zuniga contended that this phrasing interfered with the presumption of innocence. Finding that the Ninth Circuit has repeatedly upheld the use of the Ninth Circuit model jury instruction on reasonable doubt, the panel affirmed the district court's use of the Ninth Circuit's pattern jury instructions.

The fifth and final issue on appeal was Soto-Zuniga's contention that knowledge of the drug type and quantity is an element of possession with intent to distribute in violation of 21 U.S.C § 841. Rejecting this argument, the panel, citing United States v. Jefferson, 791 F.3d 1013, 1016 (9th Cir. 2015), held that the intent element only requires that Soto-Zuniga acted knowingly or intentionally, not that the he knew exactly the quantity and type of drugs he was transporting.

The panel vacated Soto-Zuniga's conviction and remanded the case for a new trial.

To read full opinion, please visit:
https://cdn.ca9.uscourts.gov/datastore/opinions/2016/09/16/14-50529.pdf

Panel: Before: Alex Kozinski, William A. Fletcher, and Ronald M. Gould, Circuit Judges.

Argument Date: Argued and Submitted May 5, 2016

Date of Issued Opinion: September 16, 2016

Docket Number: 14-50529

Decided: Conviction vacated, discovery rulings reversed, and remanded with instructions.

Counsel: Paul Allen Barr (argued), Federal Defenders of San Diego, Inc., San Diego, California, for Appellant-Appellant.

Kyle B. Martin (argued), Assistant United States Attorney; Peter Ko, Chief, Appellate Section, Criminal Division; Laura E. Duffy, United States Attorney; United States Attorney's Office, San Diego, California; for Plaintiff-Appellee.

Author of Opinion: Judge Ronald M. Gould

Case Alert Author: Prianca Murthi

Case Alert Supervisor: Professor Glenn Koppel

    Posted By: Glenn Koppel @ 11/04/2016 02:55 PM     9th Circuit     Comments (0)  

November 2, 2016
  Chauca v. Abraham - Second Circuit
Headline: Second Circuit Certifies Question of Punitive Damages Standard for Discrimination Suits Under New York City Human Rights Law to Court of Appeals

Area of Law: Employment Discrimination

Issue(s) Presented: What is the standard for a punitive damages award for unlawful discriminatory acts in violation of the NYCHRL.

Brief Summary: Plaintiff-Appellant Chauca took maternity leave from her job as a physical therapy aid in 2009. Upon her scheduled return, her employer informed her that her services were no longer needed. Chauca filed a charge with the Equal Employment Opportunity Commission ("EEOC") and ultimately brought suit in the United States District Court for the Eastern District of New York alleging sex and pregnancy discrimination under federal and state law as well as under the New York City Human Rights Law (NYCHRL). She prevailed at trial with a jury award of $10,500 in lost compensation and $50,000 for pain and suffering. Chauca now appeals the denial of a jury instruction on punitive damages, arguing that the district court failed to construe the NYCHRL's standard for punitive damages "liberally." This court analyzes her question, and certifies this question to the New York Court of Appeals for more guidance.

To read the full opinion, please visit:
http://www.ca2.uscourts.gov/de...9c9bb380976/1/hilite/

Extended Summary: Plaintiff-Appellant Veronika Chauca began working for Defendant-Appellee Park Management Systems in 2006 as a physical therapy aid. In July 2009, she informed her supervisors that she was pregnant and would be taking maternity leave with a scheduled return in late November, which they approved. During her time away, another aide handled Chauca's duties. Shortly before her scheduled return, she contacted the office to remind them and got the runaround. She was ultimately told by the Office Supervisor, Ann Marie Garriques, that "we no longer need your services." Later, Chauca's supervisors, Dr. Jamil Abraham and Garriques, claimed that Chauca was not brought back because of a business slowdown despite evidence that most other employees maintained a steady work schedule.

In December 2009, Chauca filed a charge with the Equal Employment Opportunity Commission ("EEOC") alleging pregnancy discrimination and, after receiving an EEOC notice of right to sue, brought an action against her employer, and her supervisors individually, in the United States District Court for the Eastern District of New York alleging sex and pregnancy discrimination in violation of the federal Pregnancy Discrimination Act, part of Title VII of the Civil Rights Act of 1964, as well as under New York State and New York City Human Rights Law (NYCHRL). Chauca sought compensatory and punitive damages, the latter of which is the focus of this current dispute.

At trial, the district court declined to provide a punitive damages instruction to the jury over plaintiff's objection. While recognizing that the NYCHRL calls for a liberal construction of its provisions, the district court found that Chauca did not put forward any evidence that her employer had intentionally discriminated with "malice" or with "reckless indifference" to her protected rights. The jury returned a verdict in Chauca's favor, awarding $10,500 in lost compensation and $50,000 for pain and suffering. Chauca now appeals the denial of a jury instruction on punitive damages, arguing that the district court improperly construed the NYCHRL standard for punitive damages by requiring a showing of malice or reckless indifference as required by federal law.

Under Title VII, "[p]unitive damages are limited . . . to cases in which the employer has engaged in intentional discrimination and has done so 'with malice or with reckless indifference to the federally protected rights of an aggrieved individual.'" In a 2001 decision, the Second Circuit applied the federal standard to claims for punitive damages arising under the NYCHRL. However, in 2005, the New York City Council amended the City's Administrative Code by passing the Restoration Act which sought to clarify the "uniquely broad and remedial purposes of the NYCHRL, and expressly provides that the NYCHRL "be construed liberally, . . . regardless of whether federal or New York State civil and human rights laws, including those with provisions comparably-worded to the provisions of [the NYCHRL] have been so construed." Since then, New York courts have repeatedly determined that NYCHRL claims must be analyzed separately and independently from any federal and state law claims, but no decision has specifically addressed the proper standard for awarding punitive damages under the NYCHRL and the Restoration Act does not make any specific reference to punitive damages.

The Second Circuit concluded that the question should be certified to the New York Court of Appeals, finding that existing New York case law does not "provide definitive guidance" on the appropriate standard for a punitive damages award for unlawful discriminatory acts in violation of the NYCHRL, that this is an issue of importance to the state, and that certification was proper because the answer to the question would resolve the litigation.

To read the full opinion, please visit:
http://www.ca2.uscourts.gov/de...9c9bb380976/1/hilite/

Panel:
Chief Judge Katzmann, Circuit Judges Sack and Hall.

Argument Date: 09/09/2016

Date of Issued Opinion: 11/1/2016

Docket Number: No. 15-1777

Decided: Certified Appeal

Case Alert Author: Robyn Downing

Counsel: Stephen Bergstein, Bergstein & Ullrich, LLP, for Plaintiff-Appellant
Arthur H. Forman, for the Defendants-Appellees

Author of Opinion: Chief Judge Katzmann

Circuit: 2nd Circuit

Case Alert Circuit Supervisor:
Professor Elyse Diamond

    Posted By: Elyse Diamond @ 11/02/2016 08:51 AM     2nd Circuit     Comments (0)  

November 1, 2016
  United States v. Diaz - Ninth Circuit
Headline: In a case of first impression, Ninth Circuit panel concludes that California's Proposition 47, which allows certain felony convictions to be reclassified as misdemeanor convictions, does not undermine a prior conviction's felony-status for purposes of 21 U.S.C. § 841.

Areas of Law: Criminal Law

Issues Presented: Whether a criminal defendant, previously convicted and sentenced in accordance with 21 U.S.C. § 841, is eligible to have his federal sentence reduced pursuant to California's Proposition 47, which permits certain state law felony convictions to be reclassified as misdemeanor convictions.

Brief Summary:
The named defendant and appellant, Jesse Vasquez ("Vasquez"), was convicted of his third drug trafficking related felony in 2009 and was sentenced in 2010 to life in prison, in accordance with sentencing guidelines of The Controlled Substance Act, 21 U.S.C. § 841, which mandates a sentence of life imprisonment because of Vasquez's "prior [California] convictions for a felony drug offense."

In 2014, California voters passed and enacted Proposition 47, "The Safe Neighborhoods and Schools Act," codified at Cal. Penal Code § 1170.18. Among other things, Proposition 47 reduced future convictions under Cal. Health & Safety Code § 11350(a) from a felony to a misdemeanor. Additionally, Proposition 47 permitted previously convicted felons the opportunity to petition the court for a "recall of sentence," which, if granted, would reclassify existing felony convictions as misdemeanor convictions. In 2015 Vasquez petitioned the court and was granted a reclassification of a 1996 felony conviction under § 11350(a) to a misdemeanor conviction.

Upon reclassification, Vasquez filed this appeal to challenge his sentence of life in prison, arguing that he is no longer convicted of three drug related felonies because his 1996 conviction no longer counts for purposes of § 841. The Ninth Circuit panel disagreed and affirmed his original sentence of life in prison on grounds that reclassification of a felony conviction to a misdemeanor conviction pursuant to Proposition 47 did not change or affect prior sentencing enhancements mandated by § 841.

Significance: The Ninth Circuit panel concluded that California's Proposition 47 does not apply retroactively to undermine a prior conviction's felony status for purposes of sentencing enhancements under 21 U.S.C. § 841.

Extended Summary:
Jesse Vasquez ("Vasquez") was a mid-level leader in the Florencia Trece gang who was convicted of drug-related crimes for his part in the gang's drug trafficking operations. In 2009, the district court sentenced Vasquez to life imprisonment due to Vasquez's two prior California felony convictions, one of which was under Cal. Health & Safety Code § 11350(a). Due to Vasquez's two prior California felony convictions, Vasquez qualified for a mandatory sentence enhancement pursuant to 21 U.S.C. § 841.

Section 841 imposes a mandatory life sentence if a defendant "commits [a violation of § 841] after two or more prior convictions for a felony drug offense have become final. 21 U.S.C. § 841(b)(1)(A). A "felony drug offense" is "an offense that is punishable by imprisonment for more than one year under any law of the United States or of a State or foreign country." 21 U.S.C. § 802(44).

Four years after Vasquez received his life sentence, California passed and enacted Proposition 47, The Safe Neighborhoods and Schools Act, codified at Cal. Penal Code § 1170.18, which, inter alia, reduced future convictions under § 11350(a) from a felony to a misdemeanor. The statute allows certain felony convictions to be reclassified as misdemeanor convictions and Cal. Penal Code § 1170.18(b) provides that "[a]ny felony conviction that is recalled and resentenced . . . or designated as a misdemeanor . . . shall be considered a misdemeanor for all purposes." Cal. Penal Code § 1170.18(n) also provides that "[n]othing in this and related sections is intended to diminish or abrogate the finality of judgments in any case not falling within the purview of this act."

Upon the enactment of § 1170.18, Vasquez petitioned for and was granted the reclassification of his 1996 conviction under § 11350(a) from a felony conviction to a misdemeanor conviction. Upon receiving this reclassification, Vasquez appealed his 2010 sentence of life imprisonment arguing that because he successfully petitioned in 2014 to have his 1996 conviction re-designated as a misdemeanor, that conviction no longer counts as a prior felony conviction for purposes of § 841..

The Ninth Circuit panel disagreed with Vasquez and held that § 1170.18 did not alter the prior felony conviction status as it pertains to § 841. The panel noted that federal law, not state law, controlled the interpretation of federal law (see United States v. Norbury, 492 F.3d 1012, 1014 (9th Cir. 2007) and that "[a]lthough the [state's] statute [can] determine the status of the conviction for purposes of state law, it [can]not rewrite history for the purposes of the administration of the federal criminal law or the interpretation of federal criminal statutes." United States v. Bergeman, 592 F.2d 533, 536 (9th Cir. 1979); United States v. Cisneros, 112 F.3d 1272, 1280 (5th Cir. 1997) (quoting United States v. Morales, 854 F.2d 65, 68 (5th Cir. 1988). Following this precedent, the Ninth Circuit panel held that federal law, not California law, determines the effect of California's reclassification of Vasquez's federal sentence enhancement pursuant to § 841.

The panel relied primarily on the Supreme Court's ruling in McNeill v. United States, 563 U.S. 816 (2011). In McNeill, the defendant had been convicted in the early 1990's of violating North Carolina drug laws, for which the maximum sentence was at least ten years. In 1994, North Carolina reduced the maximum sentence such that the North Carolina convictions no longer qualified for the sentencing enhancement prescribed under 18 U.S.C. §§ 924(e)(1) and 924(e)(2)(A)(ii). McNeil, 563 U.S. at 818. McNeill argued that because North Carolina had changed its laws, his prior conviction did not qualify as a "serious drug offense," but the Court disagreed and held that North Carolina's changes to McNeill's state conviction had no effect on his federal sentence. Id. at 819. The Court explained that the Armed Career Criminal Act asked a "backward-looking question" and that the "only way to answer [this question] is to consult the law that applied at the time of that conviction" because this "avoids the absurd results that would follow from consulting current state law to define a previous offense." Id. at 819-20.

The Ninth Circuit panel acknowledged that the issue of whether a state that permits reclassifying particular felony convictions as misdemeanors requires a federal court to revisit a federal sentence enhancement imposed under § 841 was a matter of first impression. However, the panel analogized Vasquez's appeal to cases that addressed whether dismissing or expunging a predicate state conviction invalidates a federal enhancement under § 841. Norbury, 492 F.3d 1012, 1015 (holding that a state's later dismissal or expungement of a predicate state conviction had no bearing on whether § 841's requirements were met). Accordingly, the Ninth Circuit panel reasoned that other than the circumstance "where the dismissal or expungement alters the legality of the original state conviction - such as where there was a trial error or it appears the defendant was actually innocent of the underlying crime," a federal enhancement "does not depend upon the mechanics of state post-conviction procedures, but rather involves the [state] conviction's underlying lawfulness."

The panel determined that, like the provision at issue in McNeill, § 841 is also a "backward-looking," inquiry which only requires that the defendant have committed his federal crime "after two or more prior convictions for a felony drug offense have become final." § 841(b)(1)(A). Thus, it is immaterial whether a state makes a change to a state conviction after it has become final because it "does not alter the historical fact of the [prior state] conviction" becoming final, which is what § 841 requires. United States v. Dyke, 718 F.3d 1282, 1293 (10th Cir. 2013), cert. denied, 134 S.Ct. 365 (2013).

In Vasquez's case, there was no doubt that Vasquez committed a federal drug offense after having been convicted of two prior drug felonies and that those prior convictions had become final. These convictions were felony convictions at the time of his final sentence-enhancement qualifying conviction and thus any change to the state law after the fact has no bearing on the felony-status for purposes of § 841.

The Ninth Circuit panel therefore held that (1) § 1170.18 did not undermine a prior conviction's felony-status for purposes of § 841 and (2) California's later actions cannot change the fact that Vasquez committed his federal offense after 'two or more convictions for a felony drug offense [had] become final" and affirmed the district court.

To read the full opinion, please visit:
https://cdn.ca9.uscourts.gov/datastore/opinions/2016/09/21/10-50029.pdf

Panel: Jerome Farris, Jay S. Bybee, and N. Randy Smith, Circuit Judges.

Argument Date: November 2, 2015

Date of Issued Opinion: September 21, 2016

Docket Number: 10-50029; 10-50052; 10-50058; 10-50059; 10-50062; 10-50064; 10-50072; 10-50076; 10-50113; 10-50115

Decided: Affirmed the district court's sentencing of Jesse Vasquez, asserting that (1) § 1170.18 did not undermine a prior conviction's felony-status for purposes of § 841 and (2) California's later actions cannot change the fact that Vasquez committed his federal offense after 'two or more convictions for a felony drug offense [had] become final.".

Case Alert Author: Ryan Schley

Counsel:
Karen Landau (argued), Oakland, California, for Defendant-Appellant Manuel Hernandez.

Ethan Balogh (argued) and Jay Nelson, Coleman, Balogh & Scott LLP, San Francisco, California, for Defendant-Appellant Jesse Vasquez.

Kenneth Reed, Santa Ana, California, for Defendant-Appellant Gilbert Oliva Diaz.

Verna Wefald, Pasadena, California, for Defendant-Appellant Arturo Cruz.

Wayne Young, Santa Monica, California, for Defendant-Appellant Alberto Hernandez.

David Phillips, Riverside, California, for Defendant-Appellant Noe Gonzalez.

Holly Sullivan, San Diego, California, for Defendant-Appellant Francisco Flores.

Michael Khouri, Khouri Law Firm, Irvine, California, for Defendant-Appellant Luis A. Aguilar.

Robinson Harley, Santa Ana, California, for Defendant-Appellant Cesar Dela Cruz.

Elana Shavit Artson (argued), Allison Westfahl Kong, and Robert Dugdale, Assistant United States Attorneys; Stephanie Yonekura, Acting United States Attorney; United States Attorney's Office, Los Angeles, California, For Plaintiff-Appellee.

Donald M. Falk, Mayer Brown LLP, Palo Alto, California; Travis Crum, Mayer Brown LLP, Washington, D.C.; Michael Romano, Stanford Law School Justice Advocacy Project, Stanford, California; David M. Porter, Co-Chair, NACDL Amicus Curiae Committee, Sacramento, California; for Amici Curie National Association of Criminal Defense Lawyers and Stanford Law School Justice Advocacy Project.

Author of Opinion: Judge Jay S. Bybee

Circuit: Ninth Circuit panel

Case Alert Supervisor: Professor Glenn Koppel

    Posted By: Glenn Koppel @ 11/01/2016 05:29 PM     9th Circuit     Comments (0)  

  A.K.H. v. City of Tustin - Ninth Circuit
Headline: The Ninth Circuit panel affirmed the district court's denial of qualified immunity to a Tustin police officer in an action brought under 42 U.S.C. § 1983 alleging that the officer used excessive force when he shot and killed an unarmed man suspected of a domestic violence dispute during an investigatory stop.

Area of Law: Constitutional Law; 42 U.S.C. § 1983

Issue Presented: Whether a Tustin Police officer is entitled to summary judgment based on qualified immunity pursuant to 42 U.S.C. § 1983 applying the Graham factors when he shot and killed an unarmed man during an investigatory stop.

Brief Summary: After a theft and domestic violence report from Benny Herrera's ("Herrera") ex-girlfriend Hilda Ramirez ("Ramirez"), police were dispatched to where Herrera was walking to take a bus to his home. Dispatch initially informed the officers that Herrera was not known to carry weapons, but that Herrera was "shown in house" to be a member of the Southside Gang, that Herrera was on parole for a state drug possession crime, and Herrera possibly had a $35,000 traffic warrant out for his arrest.

Officer Miali ("Miali") was the first to spot Herrera. As Miali drove up to Herrera, Miali turned on the red lights of his vehicle. Herrera then put his right hand in his sweatshirt pocket and refused three orders from Miali to "get down," opting to stay on his feet and continue to move down the road at about the same speed as Miali's vehicle. Officer Villarreal ("Villarreal") was second at the scene and did not hear Miali's commands. Villarreal positioned his car so as to "box" Herrera in and immediately shouted, "[g]et your hand out of your pocket." Within less than a second of ordering Herrera to take his hand out of his pocket and without warning, Villarreal fired two shots in rapid succession killing Herrera as Herrera moved to comply with Villarreal's command.

Herrera's relatives filed suit against Villarreal and the City of Tustin under 42 U.S.C. § 1983 claiming that excessive force was used in the incident. Claiming qualified immunity, Villarreal moved for summary judgment, which the district court denied. Villarreal took an interlocutory appeal of the denial of his summary judgment motion.

The Ninth Circuit panel used the two-prong analysis from Bryan v. MacPherson, 630 F.3d 805, 823 (9th Cir. 2010), which asks: (1) viewing the facts in the light most favorable to the plaintiffs, did Villarreal use excessive force in violation of the Fourth Amendment and (2) if Villarreal used excessive force, did he violate a clearly established right. As to the first prong, the Ninth Circuit panel held that, based on the totality of the circumstances and viewing the evidence in the light most favorable to the plaintiffs, Herrera's interests substantially outweighed the government's interest in using deadly force. Thus, Villarreal's fatal shooting of Herrera violated Herrera's Fourth Amendment rights. As to the second prong, the Ninth Circuit panel held that, viewing the evidence in the light most favorable to the plaintiffs, Villarreal violated clearly established Fourth Amendment law when he killed Herrera because Villarreal had no articulable basis to believe that Herrera was armed, except to say that Herrera had one hand "concealed."

The Ninth Circuit panel therefore affirmed the district court's denial of summary judgment in Villarreal's favor based on qualified immunity and remanded to the district court.

Significance: A police officer may not seize an unarmed, nondangerous suspect by shooting him dead.

Extended Summary:
Benny Herrera's ("Herrera") ex-girlfriend Hilda Ramirez ("Ramirez") called 911 and reported that Herrera had stolen her phone. Ramirez told police that Herrera did not carry any weapons and that it was his first time using violence against her. Ramierz also informed dispatch that Herrera had left the scene and was "walking down El Camino Real...towards Red Hill" likely trying to take a bus home as he had neither a car nor friends in the area. Ramirez later modified her story to include that Herrera hit her in the head while Ramierz and Herrera were arguing about Ramirez's phone.

The dispatcher's general call to Tustin Police reported that Herrera stole Ramirez's phone, left the scene, was trying to catch the bus, had no access to a vehicle, did not have friends in the area, and was not known to carry weapons. After Ramirez modified her story to the dispatcher, the dispatcher reported that Ramirez claimed that Herrera had struck Ramirez's head. The dispatcher also reported that Herrera was "shown in-house to be a member of the Southside Gang," was on parole for a state drug possession crime, and possibly had a $35,000 traffic warrant out for his arrest.

Officer Miali ("Miali") encountered Herrera first. As Miali turned on the red lights of his police vehicle, Herrera put his right hand in his shirt pocket and began to skip, walk, and run backwards facing the Miali. Miali told Herrera to "get down" three times, but Herrera did not comply.

Officer Villarreal ("Villarreal") was second on the scene and did not hear Miali's commands to Herrera. Using his patrol car, Villarreal "boxed in" Herrera and told Herrera to, "[g]et your hand out of your pocket." While Herrera was taking his hand out of his pocket, Villarreal fired two shots in quick succession without warning, killing Herrera.

At a deposition, Miali testified, "there was something in [Herrera's sweatshirt] that appeared to be heavy." Villarreal testified in his deposition that Herrera "charged [him]" and that probably "three to five seconds" passed between the time Villarreal commanded Herrera to remove his hands from his pocket and when he shot. However, Miali's dashboard camera showed Villarreal's command and his shots were almost simultaneous and that the entire encounter from the time that Miali initially made contact with Herrera to when Villarreal killed Herrera was less than one minute.

Herrera's relatives filed a claim under 42 U.S.C. § 1983 alleging that Villarreal used excessive force against Herrera when Villarreal shot Herrera two times, killing him during an attempted investigatory stop. Villarreal moved for summary judgment on grounds of qualified immunity which was denied. Villarreal filed an interlocutory appeal.

On the preliminary issue of whether the interlocutory appeal was proper, the Ninth Circuit panel noted that while summary judgment motions are not normally appealable as they are not final judgments, there is an exception for appeals based on a denial of a motion for summary judgment based on qualified immunity (Mitchell v. Forsyth, 472 U.S. 511, 530 (1985)). The Ninth Circuit panel held that Villarreal had properly brought an interlocutory appeal over which the Ninth Circuit panel had jurisdiction because "[a] defendant who appeals a denial of qualified immunity on the ground that his 'conduct did not violate the Fourth Amendment and, in any event, did not violate clearly established law" has "raise[d] legal issues" that may be properly heard in an interlocutory appeal. Plumhoff, 134 S.Ct. at 2019.

Moving to the merits of the appeal, the Ninth Circuit panel used a two-pronged approach to determine whether Villarreal was entitled to summary judgment based on qualified immunity under § 1983. "First, viewing the facts in the light most favorable to the plaintiffs, did Villarreal use excessive force in violation of the Fourth Amendment?" Bryan v. MacPherson, 630 F.3d 805, 823 (9th Cir. 2010). "Second, if Villarreal used excessive force, did he violate a clearly established right?" Id.

Excessive Use of Force

In analyzing excessive force claims under the Fourth Amendment, the question is whether the actions of the officers were "objectively reasonable." Graham v. Connor, 490 U.S. 386, 388 (1989). The nature and quality of the intrusion of individual's Fourth Amendment right is balanced against the interest the government alleges justifies the intrusion. Tennessee v. Garner, 471 U.S. 1, 7 (1985). Courts must evaluate the "totality of the circumstances" (Id. at 8), paying close attention to factors such as "the severity of the crime at issue, whether the suspect poses an immediate threat to the safety of the officers or others, and whether he is actively resisting arrest or attempting to evade arrest by flight" (Graham, 490 U.S. at 396). The "most important" of these factors is "whether the suspect posed an 'immediate threat to the safety of the officers or others.'" Mattos v. Agarano, 661 F.3d 433, 441 (9th Cir. 2011) (en banc) (quoting Smith v. City of Hemet, 394 F.3d 689, 702 (9th Cir. 2005) (en banc)). Moreover, deadly force is permissible only "if the suspect threatens the officer with a weapon or there is probable cause to believe that he has committed a crime involving the infliction or threatened infliction of serious physical harm" Garner, 471 U.S. at 11.

The Ninth Circuit panel noted that under Garner, the "nature and quality of the intrusion" by Villarreal on Herrera's Fourth Amendment interests was extreme because the use of deadly force implicates the highest level of Fourth Amendment interests. As such, the panel held that the government's interests were insufficient to justify the use of deadly force because: (1) the "crime at issue" was a domestic dispute that ended before police became involved; (2) domestic disputes do not necessarily justify the use of even intermediate let alone deadly; and (3) the use of force is especially difficult to justify when "the domestic dispute is seemingly over by the time the officers begin their investigation.

The Ninth Circuit panel further held that Villarreal could not have reasonably believed Herrera was a threat to the safety of officers or others because: (1) the domestic altercation was over; (2) Herrera posed no threat to the safety of the officers as he had no weapon; (3) officers had little, if any, reason to believe that Herrera was armed; (4) the dispatcher told the officers that Herrera was "not known to carry weapons;" (5) Herrera never displayed a weapon and Villarreal admitted that he never saw a weapon; and (6) the traffic warrant and drug possession conviction were relatively minor crimes, neither of which entailed violence or gun possession.
The panel thereafter held that, even it was accepted that (1) Herrera was "actively resisting" or "attempting to evade" an investigatory stop and (2) an arrest and an investigatory stop were equal, this factor only slightly favored the government because Herrera never attempted to flee from the officers. Moreover, Villarreal did not hear Miali's commands for Herrera to "get down." Therefore, when viewing the evidence in the light most favorable to Herrera, this factor did not weigh heavily in the government's favor to determine whether the use of deadly force was justified.

Finally, the Ninth Circuit panel noted that Villarreal had escalated to deadly force very quickly. Less than one second elapsed from Villarreal's command for Herrera to remove his hand from his pocket and the shots fired. There was no warning and insufficient time for Villarreal to make a determination whether Herrera had a weapon. Moreover, Villarreal conceded that he never saw a weapon in Herrera's hand, Herrera never threatened the officers, and Villarreal had other reasonable options. As such, and based on the totality of the circumstances and the balancing of both sides, the panel concluded that the intrusion on Herrera's interests substantially outweighed any governmental interest in using deadly force and held that Villarreal's fatal shooting of Herrera violated Herrera's Fourth Amendment rights.

Clearly Established Right

After holding that Villarreal's actions violated the Fourth Amendment, the Ninth Circuit panel considered whether Villarreal violated a right that was clearly established at the time of the violation. Espinosa v. City & Cty. of San Francisco, 598 F.3d 528, 532 (9th Cir. 2010). To determine whether such a right was violated, the panel looked to "cases relevant to the situation [Villareal] confronted" (see Brosseau v. Haugen, 543 U.S. 194, 200 (2004)), mindful that there need not be a case "directly on point" (see Gravelet-Blondin v. Shelton, 728 F.3d 1086, 1093 (9th Cir. 2013).

The panel found the Court's decision in Garner to be instructive because, as in Herrera's case: (1) the crime at issue did not involve the use of deadly force; (2) Garner fled from police after an officer told him to "halt"; and (3) the officer in Garner had no reason to suspect that the suspect was armed.

Viewing the evidence in the light most favorable to the non-moving party, the panel held that Villarreal violated clearly established Fourth Amendment law when he shot and killed Herrera because Villarreal had no reason to suspect that Herrera was armed since: (1) the dispatcher expressly told the officers that Herrera was "not known to carry weapons;" (2) Villarreal never saw a gun; and (3) Villarreal could provide no basis for his belief that Herrera was armed except to say that Herrera had one hand "concealed."

Viewing the evidence in the light most favorable to the plaintiffs, the panel held that Villarreal clearly violated clearly established Fourth Amendment law when he"seize[d] an unarmed, nondangerous suspect by shooting him dead" and affirmed the district court's denial of qualified immunity.

To read full opinion, please visit:
https://cdn.ca9.uscourts.gov/datastore/opinions/2016/09/16/14-55184.pdf

Panel: William A. Fletcher, Mary H. Murguia, and John B. Owens, Circuit Judges.

Argument Date: Argued and Submitted March, 7, 2016

Date of Issued Opinion: September 16, 2016

Docket Number: 14-55184

Decided: Affirmed and Remanded.

Counsel: M. Lois Bobak (argued), Robert L Kaufman, and Daniel K. Spradlin, Woodruff Spradlin & Smart, APC, Costa Mesa, California, for Defendant-Appellant Officer Villarreal.

No appearance by Defendant-Appellant City of Tustin.

Dale K. Galipo (argued) and Eric Valenzuela, Law Offices of Dale K. Galipo, Woodland Hills, California, for Plaintiffs-Appellees.

Author of Opinion: Judge W. Fletcher, Circuit Judge.

Case Alert Author: Krysta Maigue

Case Alert Supervisor: Professor Glenn Koppel

    Posted By: Glenn Koppel @ 11/01/2016 04:42 PM     9th Circuit     Comments (0)  

  United States v. Carey - Ninth Circuit
Headline: Ninth Circuit panel expands the "plain view" doctrine and adopts the "plain hearing" doctrine, whereby police may use evidence of conversations of speakers unrelated to a target conspiracy overheard during execution of a valid wiretap for the target conspiracy only until such time that the police know or should reasonably know that the speakers are unrelated to the target conspiracy.

Area of Law: Criminal Procedure; Fourth Amendment, Exceptions to the Warrant or Probable Cause Requirements

Issue Presented: Whether the government may lawfully use evidence obtained from conversations overheard during the execution of a wiretap order for a phone number used in a drug conspiracy where the overheard conversations are those by persons unrelated to the drug conspiracy using the authorized phone number.

Brief Summary: The Appellant-Defendant, Michael Carey ("Carey"), was charged with conspiracy to distribute cocaine after federal officers overheard Carey in conversations during the execution of a wiretap order for an unrelated drug target conspiracy. The district court denied Carey's motion to suppress evidence and Carey appealed. The Ninth Circuit panel expanded the "plain view" doctrine and adopted the "plain hearing" doctrine, holding that: (1) the government may use evidence obtained from a valid wiretap "[p]rior to the officers' discovery of [a] factual mistake" that causes or should cause them to realize that they are listening to phone calls "erroneously within the terms of the "wiretap order and (2) once the officers know or should know they are listening to conversations outside the scope of the wiretap order, they must discontinue monitoring the wiretap until they secure a new wiretap order, if possible.

Significance: The Ninth Circuit panel, addressing an issue of first impression in this Circuit - whether the Wiretap Act can be used to authorize the government to listen to people who were unaffiliated with the initial wiretap subjects - expanded the "plain view" doctrine and adopted the "plain hearing" doctrine as an exception to the Fourth Amendment. The "plain hearing" doctrine allows the government to use evidence obtained from listening to conversations of speakers who are unrelated to the target of a valid wiretap, with the limitation that the government must discontinue listening once it knows or should know the conversations are unrelated to the target of the wiretap.

Extended Summary: FBI Special Agent Christopher Meltzer ("Meltzer") obtained a wiretap order for a phone number, T-14, based on evidence that the target of a drug conspiracy, Ignacio Escamilla Estrada ("Escamilla"), used T-14 to conduct the conspiracy. Several days into the execution of the wiretap order, agents overheard "drug-related" calls. At some point thereafter, the agents realized that the person using T-14 was not Escamilla, but did not know who the people speaking on T-14 were. Melzer initially believed that the callers and calls may still be affiliated with the known targets or part of the criminal activity that he was monitoring. Melzer consulted with federal prosecutors and agents continued to monitor the calls.

Agents subsequently intercepted a call indicating that someone would be traveling with "invoices" (believed to be code for drug money), and the agents coordinated with local police officers to conduct a traffic stop. During the traffic, officers searched the vehicle, finding cash and a cell phone tied to the T-14 number and identified the driver as Adrian Madrid ("Madrid"). Officers later obtained a search warrant for a related residence and found cocaine.

After identifying Madrid, Melzer learned that there was an ongoing DEA/ICE investigation into Madrid and his associates. After Meltzer met with ICE and DEA agents, they learned that there was no "overlap" between the Madrid and Escamilla conspiracies. Agents thereafter identified defendant-appellant, Michael Carey ("Carey") as a member of Madrid's conspiracy and Carey was indicted in February 2011 for conspiracy to distribute cocaine in violation of 21 U.S.C. §§ 841(a)(1) and 846.

Carey filed a motion to suppress "any and all evidence derived from the use of wiretaps" on grounds that the government failed to comply with the Wiretap Act, 18 U.S.C. §§ 2510-22, with respect to Carey and his coconspirators. The district court denied the motion on grounds that (1) the government had complied with the statute to obtain the wiretap order against Escamilla and (2) "[t]here was no requirement for a separate showing of necessity once the agents concluded that T-14 was not primarily used by Escamilla" because "the agents reasonably believed that the callers might be affiliated with Escamilla or other offenses." Carey then pled guilty in an agreement with Carey that preserved Carey's right to appeal the denial of his motion to suppress.

On appeal, Carey raised the issue whether government agents could lawfully use the Escamilla wiretap to listen to Carey's conversations. The Ninth Circuit panel noted that there was a lack of Ninth Circuit precedent squarely on point in a situation where 18 U.S.C. § 2517(5) was used to authorize law enforcement to listen to people who were unaffiliated with the original wiretap subjects. The Ninth Circuit panel also noted that while the government showed necessity and probable cause for a wiretap of the Escamilla conspiracy, the novel question raised in Carey's appeal was "what happens when a wiretap that is valid at its inception is later used to listen to someone who is not involved in the conspiracy under surveillance?"

Looking to dicta from the Seventh Circuit, the Ninth Circuit panel found United States v. Ramirez, 112 F.3d 849 (7th Cir. 1997) to be persuasive. In Ramirez, the Seventh Circuit explained in dicta that, "t is true that if government agents execute a valid wiretap order and in the course of executing it discover that it was procured by a mistake and at the same time overhear incriminating conversations, the record of the conversations is admissible in evidence. It is just the 'plain view' doctrine translated from the visual to the oral dimension." Id. at 851. But, "once the mistake is discovered, the government cannot use the authority of the warrant, or of the [wiretap] order, to conduct a search or interception that they know is unsupported by probable cause or is otherwise outside the scope of the statute or the Constitution." Id. at 852 (citing Maryland v. Garrison, 480 U.S. 79, 87-88 (1987) (holding that the search "[p]rior to the officers' discovery of the factual mistake" did not violate the Fourth Amendment so long as the officers' failure to realize the mistake "was objectively understandable and reasonable")).

On the one hand, Carey argued that Garrison "has limited application to wiretaps" because of the Wiretap Act's procedural requirements; however, the Ninth Circuit panel found Carey's argument to be unavailing because (1) the government complied with the Wiretap Act to obtain a valid wiretap on T-14 and (2) the issue on appeal was whether the government could use the valid wiretap of T-14 to listen to unrelated people's phone calls, which was a concern that mirrored the question in Garrison of whether officers could rely on a valid warrant for entry into an unrelated person's apartment.

On the other hand, the government argued that (1) the agents could continue listening to the conversations after the agents realized the speakers were not involved in the target conspiracy because the wiretap order authorized agents to listen to conversations of "others yet unknown" and (2) under 18 U.S.C. § 2517(5), the federal officers could continue listening to the conversations because the Wiretap Act authorized listening for evidence of other crimes.

As to the government's first argument, the Ninth Circuit panel concluded that (1) the wiretap order, when read in context, did not extend to unknown people not involved in the Escamilla Conspiracy and, therefore, did not authorize the wiretap of "others yet unknown" participating in a conspiracy "yet unknown"; and (2) the wiretap order could not authorize surveillance of a yet unknown conspiracy because the statute expressly requires agents to demonstrate probable cause and necessity to procure a wiretap order (see 18 U.S.C. § 2518(b)-(c)). Essentially, the Ninth Circuit panel interpreted "others yet unknown" as referring to others yet unknown who are participating in the target conspiracy and held that Melzer's affidavit contained no information about unknown people engaged in drug trafficking outside the Escamilla conspiracy.

As for the government's second argument, the Ninth Circuit panel reasoned that § 2517(5) only allows the government to use "communications relating to offenses other than those specified in the authorization or approval" when officers are "engaged in intercepting wire, oral, or electronic communications in the manner authorized [by the statute]." As such, the Ninth Circuit panel reasoned that the wiretap order did not authorize agents to listen to conversations outside the Escamilla conspiracy and § 2517(5) did not aid the government.

The panel therefore held that (1) "[t]he government may use evidence obtained from a valid wiretap '[p]rior to the officers' discovery of [a] factual mistake' that causes or should cause them to realize that they are listening to phone calls 'erroneously included within the terms of the' wiretap order (Garrison, 480 U.S. at 87-88) and (2) "once the officers know or should know they are listening to conversations outside the scope of the wiretap order, they must discontinue monitoring the wiretap until they secure a new wiretap order, if possible (id. at 87).

Applying this two-pronged rule to Carey's case, the panel noted that the government could only use evidence obtained in accordance with the "plain hearing" doctrine. On the record presented, the panel was unable to discern: (1) what evidence was obtained before the agents knew or should have known that they were listening to calls outside the Escamilla conspiracy; (2) the identities of the persons who called T-14; and (3) how much of the government's wiretap evidence may be outside of the "plain hearing" doctrine. The panel also found that the record lacked the factual findings necessary to determine what evidence was admissible against Carey. As such, the Ninth Circuit panel vacated the district court's order denying Carey's motion to suppress and remanded on an open record to determine what evidence is admissible against Carey under the "plain hearing" doctrine's framework.

To read the full opinion, please visit:
https://cdn.ca9.uscourts.gov/datastore/opinions/2016/09/07/14-50222.pdf

Panel: Alex Kozinski, William A. Fletcher, and Ronald M. Gould, Circuit Judges

Argument Date: May 6, 2016

Date of Issued Opinion: September 7, 2016

Docket Number: 14-50222

Decided: District Court ruling vacated and case remanded to determine what evidence was admissible under the "plain hearing" doctrine.

Case Alert Author: Camille Hooper

Counsel: Knut Sveinbjorn Johnson (argued) and Emerson Wheat, San Diego, California, for Defendant-Appellant.

Peter Ko (argued), Assistant United States Attorney, Chief Appellate Section, Criminal Division; Laura E. Duffy, United States Attorney; United States Attorney's Office, San Diego, California; for Plaintiff-Appellee.

Author of Opinion: Ronald M. Gould, Circuit Judge

Case Alert Supervisor: Professor Glenn Koppel

    Posted By: Glenn Koppel @ 11/01/2016 04:39 PM     9th Circuit     Comments (0)  

  NewGen, LLC v. Safe Cig, LLC
Headline: After plaintiff's complaint failed to properly allege the citizenship of the defendant LLC to invoke diversity jurisdiction and a $1.5 million default judgment entered, the district court properly granted plaintiff leave to amend its complaint to correct the defective jurisdictional allegation and denied defendant's 60(b) motion to set aside the default judgment.

Areas of Law: Federal Civil Procedure: Diversity Jurisdiction

Issues Presented: (1) Whether the district court erred in permitting the plaintiff to amend its original complaint to cure the defective allegations of diversity jurisdiction under 28 U.S.C. § 1653, without reopening the default judgment. (2) Whether Safe Cig challenged the factual basis for diversity jurisdiction, triggering an obligation on the part of NewGen to offer supplemental evidence proving jurisdiction. (3) Whether the district court abused its discretion in the denial of relief from the default judgment.

Brief Summary: The Ninth Circuit panel affirmed the district court's grant of an approximately $1.5 million default judgment against Safe Cig, LLC ("Safe Cig") and in favor of NewGen, LLC ("NewGen") after accepting NewGen's amended allegations of diversity citizenship as true.

The Ninth Circuit panel held that the district court properly allowed NewGen to amend its original complaint pursuant to 28 U.S.C. § 1653 to properly allege diversity jurisdiction under 28 U.S.C. § 1332 after entry of the default judgment, finding that the operative statute, § 1653, applies to both judgments on the merits and default judgments.

Next, the Ninth Circuit panel held that the district court had subject matter jurisdiction, reasoning that Safe Cig's initial appeal and its Fed. R. Civ. P. 60(b) motion raised only facial, not factual, challenges to the district court's subject matter jurisdiction. Because a facial attack that challenges the legal sufficiency of the jurisdictional allegations warrants only leave to amend the allegations of diversity jurisdiction, not wholesale revival of a defaulted defense and an obligation to supplement the record, the panel held that "the amended allegations - which were undoubtedly legally sufficient - resolved the only question ever raised regarding the district court's subject matter jurisdiction."

Finally, after weighing the factors set forth in Eitel v. McCool, 782 F.2d 1470 (9th Cir. 1986), the panel that the district court's decision to enter default judgment was not an abuse of discretion.

Significance: Ninth Circuit panel holds that 28 U.S.C. § 1653 allows a plaintiff to amend its original complaint to cure defective allegations of diversity jurisdiction after default judgment has been entered where the defendant's 60(b) motion and appeal raises only facial challenges to the court's subject matter jurisdiction. Defendant's assertion that it is "without knowledge or information sufficient to form a belief" as to the domiciles of its members does not controvert the complaint's jurisdictional allegations and, therefore, does not impose a burden on the plaintiff to come forward with evidence to prove subject matter jurisdiction.

Extended Summary: NewGen, LLC ("NewGen"), a Wisconsin limited liability company, is an online marketing agency that contracted with the Safe Cig, LLC ("Safe Cig"), a California limited liability company, to promote the sale of Safe Cig's electronic cigarettes. The terms of the relationship were set out in two separate agreements - an Affiliate Agreement and a Consulting Agreement - under which NewGen agreed to attract online customers to Safe Cig's website.

NewGen alleged that Safe Cig breached both agreements by failing to: (1) pay NewGen its lifetime 20% commission on all sales resulting from NewGen's referrals, (2) grant NewGen access to its sales records to verify those commissions, (3) pay NewGen in exchange for not launching a competitor, and (4) pay NewGen for general marketing and business consultant services.

Three days after NewGen filed this complaint, NewGen properly served Safe Cig with process by serving Safe Cig's registered agent, notwithstanding resistance on the agent's part. Safe Cig thereafter failed to respond to the complaint on ground that service of process had been effective.

NewGen filed an application for default judgment, which the district court entered.
On the same day that the default judgment was entered, Safe Cig contacted NewGen and offered a deal: it would not contest service in exchange for a 60-day extension to respond to the complaint. NewGen rejected Safe Cig's offer, and the default judgment was entered. The district court found that service was effective and that it had diversity jurisdiction.

In response to the default judgment, Safe Cig launched a two-pronged attack: (1) Safe Cig appealed to the Ninth Circuit, claiming relief from judgment because the entry of default was an abuse of discretion under Eitel v. McCool, 782 F.2d 1470 (9th Cir. 1986) and (2) Safe Cig filed in the district court a Rule 60(b) motion for relief from the judgment, requesting the district court to declare the default judgment void for lack of subject matter jurisdiction.

Both parties and the district court agreed that the original complaint failed to properly plead diversity jurisdiction. Instead of alleging the citizenship of the members of the limited liability companies, the complaint improperly alleged that NewGen was a Wisconsin limited liability company with its principal place of business in Wisconsin, and that Safe Cig was California limited liability company with its principal place of business in California The district court granted NewGen leave to amend the complaint to cure the defective allegations because: (1) the record established that "none of the members of Safe Cig were domiciliaries of Wisconsin when the case was filed, "and thus, "ecause NewGen and Safe Cig were not citizens of the same state when the case was filed, the [district court] had jurisdiction over the matter;" (2) NewGen did not have affirmative duty to prove diversity with affidavits because Safe Cig had not denied NewGen's factual allegations of diversity; and (3) NewGen "could have met [Safe Cig's] facial challenge simply by amending the jurisdictional allegations of the complaint." Thus, the district court denied the Rule 60(b) motion on condition that NewGen amend its complaint to cure the original, "defective" allegations of jurisdiction pursuant to 28 U.S.C. § 1653.

NewGen thereafter filed its amended complaint properly alleging diverse citizenship. Safe Cig filed an answer challenging the allegations based on Safe Cig's purported lack of knowledge and information about the citizenship of its members. Because the district court found that Safe Cig had not challenged the veracity of NewGen's allegations of citizenship, it likewise found that the answer did not upset "the Court's previous finding that the judgment in this case was not void for want of subject matter jurisdiction."
The Ninth Circuit panel first held that the district court acted within its statutory authority under 28 U.S.C.§ 1653 to permit NewGen to amend its complaint to correct its jurisdictional allegations, interpreting the text of section 1653 to be a "liberal amendment rule" that "permits a party who has not proved, or even alleged, that diversity exists to amend his pleadings even as late as on appeal." Furthermore, the panel interpreted the intent of section 1653 to avoid the needless expenditure of judicial resources where a court can instead "permit the action to be maintained if it is at all possible to determine from the record that jurisdiction does in fact exist."

The panel rejected Safe Cig's assertion that section 1653 applies only to judgments on the merits and not default judgments, finding nothing in the text of section 1653 to not justify exempting default judgments from § 1653.

The panel next considered whether Safe Cig successfully challenged the factual basis of NewGen's complaint alleging diversity jurisdiction thereby triggering an obligation on the part of NewGen to offer supplemental evidence proving jurisdiction. Noting that a "Rule 60(b) motion may encompass a claim that the district court acted in excess of its jurisdiction," the panel reasoned that only upon a factual attack does a plaintiff have an affirmative obligation to support jurisdictional allegations with proof. Letite v. Crane Co., 749 F.3d 1117, 1121 (9th Cir. 2004). Conversely, a facial attack is easily remedied by leave to amend jurisdictional allegations pursuant to § 1653.

The panel rejected Safe Cig's argument that its lack of knowledge about the citizenship of its own members raised a jurisdictional challenge that shifted the burden to Safe Cig to come forward with evidence that jurisdiction was wanting, finding that: (1) at no point did Safe Cig assert that any of its members were citizens of Wisconsin, or argue that NewGen's sole member was not a citizen of Wisconsin; (2) Safe Cig never challenged or questioned any of the factual predicates to diversity jurisdiction: and (3) most importantly, Safe Cig never asked for discovery to clarify the issue.

Accordingly, the panel held that, "because the only real challenge to jurisdiction concerned the sufficiency of the pleadings, the amended allegations - which were undoubtedly legally sufficient - resolved the only question ever raised regarding the district court's subject matter jurisdiction." Satisfied that the district court had subject matter jurisdiction and that the amended complaint corrected any defect in the pleadings, the panel then reviewed whether the district court abused its discretion in denying the defendants request for relief from the default judgment.

Finally, the panel rejected the Safe Cig's contention that the district court abused its discretion in denying Safe Cig's motion to vacate the default judgment. The panel considered the following factors: (1) the possibility of prejudice to the plaintiff, (2) the merits of plaintiff's substantive claim, (3) the sufficiency of the complaint, (4) the sum of money at stake in the action, (5) the possibility of a dispute concerning material facts, (6) whether the default was due to excusable neglect; and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits. Eitel, 782 F.2d at 1471-72.

In weighing the Eitel factors, the Ninth Circuit panel found that numerous factors weighed in favor of entry of default judgment, such as: (1) Safe Cig's blatant attempt to resist service, despite being properly served; (2) Safe Cig's failure respond to the complaint; (3) Safe Cig's failure to give any "credible, good faith explanation" for its apparent bad faith "intention to take advantage of the opposing party, interfere with judicial decisionmaking, or otherwise manipulate the legal process; (4) Safe Cig's failure to "present specific facts that would constitute a defense" or that would substantially alter the liability at stake; and (5) the fact that Safe Cig's counsel waited until default was entered to finally contact NewGen's attorneys..

Observing that that it was not the appellate court's role to second-guess the district court's weighing of the Eitel factors, the panel held that the district court's decision to enter default judgment was not an abuse of discretion.

To read the full opinion, please visit:

https://cdn.ca9.uscourts.gov/datastore/opinions/2016/09/07/13-56157.pdf

Panel: M. Margaret McKeown and Sandra S. Ikuta, Circuit Judges, and Robert W. Pratt, District Judge.

Argument Date: February 11, 2016

Date of Issued Opinion: September 7, 2016

Docket Number: 13-56157; 14-57015; 13-56225

Decided: Affirmed the district court's grant of default judgment against Safe Cig, LLC and in favor of NewGen, LLC, holding that the district court had subject matter jurisdiction to enter the judgment because both Safe Cig's initial appeal and its Fed. R. Civ. P. 60(b) motion were facial and not factual attacks on the district court's subject matter jurisdiction, and that Safe Cig never called into question the factual predicates to establish diversity jurisdiction, nor did the district court abuse its discretion is denying Safe Cig's request for relief from default judgment.

Case Alert Author: Sean Kurdoglu

Counsel:
Ricardo P. Cestero (argued) and Daniel G. Stone, Greenberg Glusker Fields Claman & Machtinger LLP, Los Angeles, California; for Appellant/Cross-Appellee.

Harry E. Van Camp (argued) and Deborah C. Meiners, DeWitt Ross & Stevens S.C., Madison, Wisconsin, for Appelle/Cross-Appellant.

Author of Opinion: Judge M. Margaret McKeown

Case Alert Supervisor: Professor Glenn Koppel

    Posted By: Glenn Koppel @ 11/01/2016 04:35 PM     9th Circuit     Comments (0)  

October 31, 2016
  Teutscher v. Riverside Sheriff's Association
Headline: The Ninth Circuit holds the district court erred in awarding ERISA front pay and reinstatement after the jury already had awarded front pay for state employment law violations.

Areas of Law: Seventh Amendment, ERISA, Remedies

Issues Presented: (1) Whether an award of the equitable remedies of front pay and reinstatement pursuant to ERISA violates the Seventh Amendment after the jury already awarded front pay as damages for state employment law violations; and (2) whether an employee who elected the remedy of front pay would have an unlawful double recovery if also awarded the equitable remedy of reinstatement pursuant to ERISA.

Brief Summary: Plaintiff-Appellee Scott Teutscher ("Teutscher") sued his former employer, Riverside Sheriffs' Association ("RSA") for retaliatory discharge, alleging violations of California law and the Employee Retirement Income Security Act, 29 U.S.C. §§ 1001-1461 ("ERISA"). The jury, using a general verdict form to which neither party objected, awarded Teutscher compensatory damages and punitive damages. Implicit in the jury's award, were amounts for back pay, front pay, and pain, suffering, and emotional distress. Thereafter, the district court ordered Teutscher's reinstatement plus $98,235 per year until reinstatement as ERISA equitable remedies. On appeal, the Ninth Circuit panel reversed the district court's equitable award of front pay on the ERISA claim as violating the Seventh Amendment and the court's reinstatement order because it was duplicative of the front pay remedy.

Significance: When a discharged employee alleges violations of state employment law and ERISA, and the jury's verdict on the state claims includes front pay, it is a violation of the Seventh Amendment for a district court to award additional front pay pursuant to ERISA. Additionally, if the employee elects the remedy of front pay, he may not receive the remedy of reinstatement to cover the same period of time as this would be an unlawful double recovery.

Extended Summary: Riverside Sheriffs' Association ("RSA") is an organization representing law enforcement employees in various collective bargaining agreements. It also administers a Legal Defense Trust ("Trust") governed by ERISA. Teutscher, at-will employee, was the Trust's Legal Operations Manager. He became suspicious that RSA was providing legal services for a criminal defense that was not permitted under the plan. When he informed RSA that he had expressed his concerns to local law enforcement, he was terminated. Teutscher then filed a lawsuit alleging wrongful termination. His complaint included claims for violations of Section 510 of ERISA, 29 U.S.C. § 1140, California Labor Code §§ 98.6 and 1102.5, and California common law.

At trial, a jury decided the state claims. The district court instructed the jury to calculate any damages based on what Teutscher would have earned up to the trial, the value of any future wages and benefits he would have accrued for as long as the jury found he would have been employed by RSA, and punitive damages if they found RSA's conduct was a substantial factor in causing his harm. Using a general verdict form to which neither party objected, the jury awarded Teutscher $457,250 in compensatory damages and $357,500 in punitive damages. Subsequently, the district court held a bench trial on the ERISA claim. The court awarded the equitable remedies of reinstatement and front pay of $98,235 per year until Teutscher was reinstated. RSA appealed on the grounds that the district court violated the Seventh Amendment by awarding additional front pay and the prohibition against double recovery by awarding front pay and reinstatement to cover the same period of time.

On appeal, the Ninth Circuit panel reversed the district court's equitable awards of front pay and reinstatement. As to the first issue, the court recognized that Seventh Amendment provides the right to trial by jury is to be preserved in suits at common law and that "no fact tried by a jury, shall be otherwise reexamined in any Court of the United States, than according to the rules of the common law." In this case, the state law claims and the remedy of damages were legal remedies, while the relevant ERISA remedies were exclusively equitable. Thus, Teutscher had a right to a jury trial on the state claims, but not for the ERISA remedies. The court also cited Dairy Queen, Inc. v. Wood, 369 U.S. 469, 479 (1962). In Dairy Queen the United States Supreme Court held that where legal and equitable claims turn on common issues of fact, any legal issues must be determined by the jury, and the jury's determination of the issues must occur prior to any final court determination of the equitable claims.

The Ninth Circuit found that the district court contravened these constitutional restraints. Although the district court's ERISA remedies shared common questions of fact with the jury's damages calculation, the court's findings conflicted with the jury's on front pay. Teutscher's California damages claims included front pay for salary and benefits he would have earned from employment after the trial. Thus, a legal front pay award under the state's law turned on the same issues of facts as an equitable front pay award under ERISA. The jury decided the front pay issue, and the Seventh Amendment does not permit the jury's findings to be cast aside in this matter. For this reason, the district judge erred in awarding additional front pay.

The court rejected Teutscher's argument that the jury did not actually award him front pay. First, the Ninth Circuit found that the lump-sum format of the jury verdict form prevented it from ascertaining the relative amounts of back pay and front pay that the jury awarded. Teutscher asked the jury to award him front pay and did not object to the lump-sum verdict form, thereby waiving any argument that the jury's verdict should or could be parsed between its compensatory components. It is possible the damages award included front pay. Moreover, even if the court could parse the jury award and find the jury awarded zero front pay, this would be a jury finding of fact. For these reasons, the district court had no authority to disregard the jury's findings and award additional front pay.

Next, the Ninth Circuit considered whether the district court erred in ordering Teutscher's reinstatement because of the potential overlap with his damages award and because Teutscher waived reinstatement when he elected to seek front pay from the jury. The court discussed how the doctrine of double recovery dictates that a plaintiff can recover no more than the loss actually suffered. A plaintiff is unjustly enriched when he receives damages in excess of his injuries. The ERISA equitable remedies of reinstatement and front pay are alternative remedies which cannot be awarded to cover the same period of time.

In this case, Teutscher waived his right to reinstatement when he affirmatively elected to seek front pay from the jury. Under the election of remedies doctrine, a party is bound by his election of remedies if three conditions are met: "(1) two or more remedies ... existed at the time of the election, (2) these remedies [are] repugnant and inconsistent with each other, and (3) the party to be bound ... affirmatively chose[], or elected, between the available remedies." Because all of these conditions are met in the instant case, Teutscher was foreclosed from seeking the reinstatement remedy.

For these reasons, the Ninth Circuit reversed the district court's equitable awards of front pay and reinstatement.

To read the full opinion, please visit:

https://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/26/13-56411.pdf

Panel: Milan D. Smith, Jr., Paul J. Watford, and Michelle T. Friedland, Circuit Judges

Argument Date: January 5, 2016

Date of Issued Opinion: August 26, 2016

Docket Number: 13-56411

Decided: Reversed the district court's ERISA equitable awards of reinstatement and front pay

Case Alert Author: Amanda Cline

Counsel: Daniel P. Stevens (argued) and Heather K. McMillian, Stevens & McMillian, Tustin, California, for Plaintiff-Appellee

Jon R. Williams (argued), Williams Iagmin LLP, San Diego, California, for Defendant-Appelle.
William N. Woodson, III (argued), Law Offices of Wm. N. Woodson, III APC, Fallbrook, California, pro se Intervenor-Appellant

Author of Opinion: Judge Friedland

Concurrence: Judge Smith

Circuit: Ninth Circuit

Case Alert Supervisor: Philip L. Merkel

    Posted By: Glenn Koppel @ 10/31/2016 12:41 PM     9th Circuit     Comments (0)  

October 27, 2016
  Diaz v. City of Anaheim
Headline: The Ninth Circuit held that the district court erred by not bifurcating the liability and damages phases of a trial involving allegations of excessive force by police and by admitting inflammatory gang affiliation evidence on the question of liability.

Areas of Law: Civil Rights, Civil Procedure, Evidence

Issues Presented: Whether the district court erred in not bifurcating the liability and damages phases of a trial involving alleged excessive force by the police and allowing the jury to hear prejudicial gang affiliation evidence on the question of liability.

Brief Summary: The Ninth Circuit panel reversed the decision of the district court and remanded the case for a new trial. Inflammatory evidence of gang membership was irrelevant to the question of whether the police used excessive force. The district court erred by not bifurcating the liability and damages phases of the trial and admitting gang membership evidence on the question of liability. As to the excessive force claim, the Ninth Circuit panel affirmed the district court's decision to deny Plaintiffs' motion for judgment as a matter of law.

Extended Summary: City of Anaheim Police Officer Nicholas Bennallack ("Bennallack") shot and killed Manuel Diaz ("Diaz") after a foot pursuit in gang territory in the city. Bennallack testified he shot Diaz because he believed Diaz had a gun and was ready to fire. Other witnesses disagreed about Diaz's movements. Although officers found a cell phone and narcotics pipe nearby Diaz, no firearm was recovered at the scene. Diaz died a short time later.

Diaz's estate and his mother ("Plaintiffs") sued the City of Anaheim and Bennallack for non-economic damages under 42 U.S.C. § 1983, claiming for excessive force, unlawful detention under the Fourteenth Amendment, and battery.

Before the trial, the district court ruled on a number of motions in limine relating to Diaz's gang affiliation as to the issue of liability. The court excluded photographs of Diaz's gang tattoos, but noted that it would revisit the admissibility issue if Diaz's mother testified that she had no knowledge of his gang affiliation. The court also decided a gang expert could testify as to Diaz's gang membership, but only relevant as to damages. It excluded unduly prejudicial testimony about gang activities in general and Diaz's specific gang activities.

Plaintiffs moved to bifurcate the liability phase from the damages phase to keep prejudicial information unknown to Bennallack at the time of the shooting from the jury. The district court agreed to sever punitive damages from liability and compensatory damages, but refused to bifurcate liability from compensatory damages, explaining that limiting instructions would cure any potential prejudice.

During the trial, and over Plaintiffs' attorney's repeated objections, the district court's evidentiary rulings failed to comport with its pretrial rulings so that the jury was exposed to "copious amounts of inflammatory and prejudicial evidence with little (if any) relevance." The most prejudicial evidence related to Diaz's gang membership, including testimony from the gang expert, photographs featuring Diaz's gang tattoos, and Diaz posing with guns and throwing gang signs, none of which Bennallack knew about when he shot Diaz. Although the court at times ordered the gang expert's testimony stricken, the jury was exposed to testimony wholly irrelevant to liability and of limited relevance even as to damages. Other inflammatory evidence admitted over Plaintiffs' objections concerned Diaz's drug use, the amount of methamphetamine in Diaz's system at the time of the shooting, and whether Diaz was under the influence of methamphetamine when shot.

After hearing the evidence, the jury returned a verdict for Defendants, finding Bennallack did not use excessive or unreasonable force. Plaintiffs moved for a new trial, but the court denied the motion. This appeal followed.

The Ninth Circuit panel began its opinion by stating that Federal Rule of Civil Procedure 42(b) permits a trial court to order a separate trial of separate claims or issues for convenience, to avoid prejudice, or to economize. This includes the authority to separate trials into liability and damages phases. De Anda v. City of Long Beach, 7 F.3d 1418, 1421 (9th Cir. 1993). The court held that the district court abused its discretion by refusing to bifurcate the compensatory damages phase, thereby allowing unduly prejudicial evidence on the question of liability. As a result, despite the trial court's pre-trial evidentiary rulings, the jury was exposed to "copious amounts of inflammatory and prejudicial evidence" relating to Diaz's alleged gang activity and drug use. Gang evidence has the potential to be particularly prejudicial. Kennedy v. Lockyear, 379 F.3d 104,1055 (9th Cir. 2004). The court described the gang evidence here as "simply overkill."

The Ninth Circuit panel cautioned that it was not announcing a rule that requires district courts to "always, usually, or frequently" bifurcate damages from liability, as trial courts have broad discretion. But where graphic and prejudicial evidence about the victim has little or in large part no relevance on the liability issue, courts should bifurcate.

To assist the district court in the retrial of this case, the court provided the following "guidance." First, evidence of Diaz's drug use and gang affiliation has marginal, if any, probative value as to damages, and none as to liability. Second, if Plaintiffs will stipulate Diaz was a gang member, no expert testimony about gangs should be admitted. Third, the district court should recognize that a limiting instruction may not sufficiently mitigate the prejudicial impact of evidence in all cases. Fourth, if the trial court is going to strike testimony, the court should clearly identify what testimony was improperly given and instruct the jury that it may not be considered. Further, the court should warn witnesses and attorneys that further attempts to "push the envelope" could lead to greater sanctions as "lawyers and witnesses, like misbehaving children or rattled basketball players, sometimes need a timeout."

Finally, the Ninth Circuit panel considered the Plaintiff's cross-appeal, claiming the district court erred in denying their motion for judgment as a matter of law on the excessive force issue. The court affirmed the denial of the motion because there were factual issues for the jury to resolve.

To read the full opinion, please visit:
http://cdn.ca9.uscourts.gov/da...16/08/24/14-55644.pdf

Panel: Marsha S. Berzon and John B. Owens, Circuit Judges, and Alegnon L. Marbley, District Judge

Argument Date: July 7, 2016

Date of Issued Opinion: August 24, 2016

Docket Number: No. 14-55644

Decided: Reverse and Remanded

Case Alert Author: Kimberly Dang

Counsel: Dale K. Galipo (argued) and Melanie T. Partow, Law Offices of Dale K. Galipo, Woodland Hills, California; Angel Carrazco, Kr., Carrazco Law, A.P.C., Tustin, California; Paul L. Hoffman, Schonbrum Desimone Seplow Harris & Hoffman, LLP, Venice, California; Humberto Guizar, Humberto Guizar Law Offices, Montebello, California; for Plaintiffs-Appellants

Moses W. Johnson, IV (argued), Assistant City Attorney, Anaheim, California; Steven J. Rothans and Jill Williams, Carpenter, Rothans & Dumont, Los Angeles, California; for Defendants-Appellants

Author of Opinion: Judge Owens

Circuit: Ninth Circuit

Case Alert Supervisor: Philip Merkel

    Posted By: Glenn Koppel @ 10/27/2016 03:42 PM     9th Circuit     Comments (0)  

  Castro v. County of Los Angeles
Headline: The Ninth Circuit, sitting en banc, upholds a jury verdict under 42 U.S.C. § 1983 finding individual and municipal entity defendants liable for violating pretrial detainee's fundamental due process right to be protected from harm at the hands of another inmate.

Areas of Law: Civil Rights, Constitutional Law, Fourteenth Amendment, Due Process Clause, Pretrial Detainees

Issues Presented: (1)Whether the evidence supported the jury finding that defendant jail employees knew of the substantial risk of serious harm and thus were liable for plaintiff's injuries resulting from a beating by another inmate; and (2) whether the evidence supported the jury finding that the entity defendants had notice that their customs and policies posed a substantial risk to persons detained in a sobering cell and were deliberately indifferent to that risk.

Brief Summary: The Ninth Circuit affirmed the district court's judgment in an action brought against individual defendants Christopher Solomon and David Valentine and entity defendants County of Los Angeles and Los Angeles Sheriff's Department under 42 U.S.C. § 1983 by Plaintiff Jonathan Michael Castro. Castro, a pretrial detainee, alleged his due process right to be protected from harm was violated when he was severely beaten and injured in his cell by another inmate. The jury returned a verdict for Castro and the district court denied defendants' motion for judgment as a matter of law. A three-judge panel of the Ninth Circuit affirmed the judgment as to Solomon and Valentine but reversed as to the County and the Sheriff's Department. A majority of active non-recused judges voted to rehear the case en banc.

Relying on Kingsley v. Henrickson, 135 S. Ct. 2466 (2015), the Ninth Circuit concluded that the evidence supported the jury's findings that Solomon and Valentine were responsible for Castro's injuries. It held that a pretrial detainee must prove the following in a Fourteenth Amendment failure-to-protect claim against an individual officer: (1) The defendant made an intentional decision with respect to the conditions under which the plaintiff was confined; (2) those conditions put the plaintiff at substantial risk of suffering serious harm; (3) the defendant did not take reasonable available measures to abate that risk, even though a reasonable officer under the circumstances would have appreciated the high degree of risk involved - making the consequences of the defendant's conduct obvious; and (4) by not taking such measures the defendant caused plaintiff's injuries.

The Ninth Circuit also held that the entity defendants had notice that their customs or policies posed a substantial risk of serious harm to persons detained in the sobering cell and were deliberately indifferent to that risk. The Court found that the custom or policy to use a sobering cell that lacked adequate surveillance caused Castro's injury, and that substantial evidence supported the jury's finding that the entity defendants knew the customs and policies could lead to a constitutional violation.
Significance: The Ninth Circuit announced the standards to analyze Fourteenth Amendment failure-to-protect claims brought by pretrial detainees against individual and entity defendants.
Extended Summary: Plaintiff-Appellee Castro ("Castro") was detained by the Los Angeles Sheriff's Department and put in a sobering cell in the West Hollywood police station. Several hours later, authorities placed John Gonzales ("Gonzales") in the same cell. Gonzales had been arrested on a felony charge and was enraged and combative. Castro banged on the cell's window to try and attract attention but no officials responded. An unpaid community volunteer walked by the cell about 20 minutes after Castro had sought help and noticed that Gonzales was inappropriately touching Castro's thigh while Castro appeared to be asleep. The volunteer did not enter the cell to investigate. Six minutes later Solomon, the station's supervising officer, arrived at the cell and discovered Gonzales stomping on Castro's head and found Castro lying unconscious in a pool of blood. Castro was hospitalized for four days and transferred to a long-term care facility where he remained for four years.

Castro filed a complaint against Solomon and Solomon's supervisor, Valentine ("individual defendants"), and the County of Los Angeles and the Los Angeles County Sheriff's Department ("entity defendants") claiming that Castro's constitutional rights were violated as a result of being housed in the sobering cell with Gonzales without appropriate supervision.

After Castro presented his case at trial, defendants moved for judgment as a matter of law on the grounds that: (1) there was insufficient evidence that the design of a jail cell constitutes a policy, practice, or custom by the County of Los Angeles that resulted in a constitutional violation; (2) there was insufficient evidence that a reasonable officer would have known that housing Castro and Gonzales together was a violation of Castro's constitutional rights; and (3) there was insufficient evidence for the jury to award punitive damages. The district court denied the motion. The jury returned a verdict for Castro and awarded him over $2 million in damages. Defendants renewed their motion for judgment as a matter of law, but the district court denied it. Defendants timely appealed.

A three-judge panel of the Ninth Circuit affirmed the judgment of the district court as to the individual defendants, but reversed as to the entity defendants. Castro v. County of Los Angeles, 797 F.3d 654 (9th Cir. 2015). A majority of active non-recused judges thereafter voted to rehear the case en banc. Castro v. County of Los Angeles, 809 F.3d 536 (9th Cir. 2015).

Claim against the individual defendants: The first issue addressed in the en banc opinion is the claim against the individual defendants. They maintained that they are entitled to qualified immunity and that Castro failed to show that they were deliberately indifferent to a substantial risk of serious harm. In determining whether an officer is entitled to qualified immunity, a court must evaluate two independent questions: (1) whether the officer's conduct violated a constitutional right, and (2) whether that right was clearly established at the time of the incident. See Pearson v. Callahan, 555 U.S. 223, 232 (2009).

Here, the Ninth Circuit recognized Castro's due process right, as a pretrial detainee who had not been convicted of any crime, to be free from violence from other inmates. The Ninth Circuit noted that a right is clearly established when the "contours of the right [are] sufficiently clear that a reasonable official would understand that what he is doing violates that right." Anderson v. Creighton, 483 U.S. 635, 640 (1987). The "contours" of Castro's rights were his right to be free from violence at the hands of other inmates. Farmer v. Brennan, 511 U.S. 825, 833 (1994). The Ninth Circuit determined that these "contours" are clearly established. They require only that individual defendants take reasonable measures to mitigate the substantial risk to Castro. Thus, qualified immunity does not bar the claim against the individual defendants.

In order for a pretrial detainee to sue prison officials under the Fourteenth Amendment's Due Process Clause for failure to protect or for the use of excessive force, the plaintiff must show that the prison officials acted with "deliberate indifference." Bell v. Wolfish, 441 U.S. 520, 535 (1979). The standard to prove "deliberate indifference" under the Eighth Amendment is well established. An "official must demonstrate a subjective awareness of the risk of harm" in order to find an individual deliberately indifferent under the Eighth Amendment. Conn v. City of Reno, 591 F.3d 1081 (9th Cir. 2010).

The standard for deliberate indifference under the Fourteenth Amendment is less clear. In Clouthier v. County of Contra Costa, 591 F.3d 1232 (9th Cir. 2010), the Ninth Circuit held the subjective test applied in Fourteenth Amendment cases. The Supreme Court, however, cast doubt on that holding in Kingsley v. Hendrickson, 135 S. Ct. 2466 (2015). Kingsley involved the use of excessive force against a pretrial detainee. The Supreme Court held the detainee must show only that the forced used against him was objectively unreasonable. Id. at 2473-74.

In the instant case, the Ninth Circuit applied the Kingsley objective standard to failure-to-protect claims and overruled the portions of Clouthier requiring a plaintiff to prove subjective intent to punish. The court recognized that an excessive force claim requires an affirmative act while a failure-to-protect claim usually involves inaction. The first question in a failure-to-act case is whether the officer's conduct was intentional. The second question involves the objective standard: whether a substantial risk of harm could have been eliminated through reasonable and available measures that the officer did not take.

Putting these principles together, the Ninth Circuit held the elements of a pretrial detainee's Fourteenth Amendment failure-to-protect claim against an individual officer are: (1) that the defendant made an intentional decision with respect to the conditions under which the plaintiff was confined; (2) that those conditions put the plaintiff at substantial risk of suffering serious harm; (3) that the defendant did not take reasonable measures to abate the risk, even though a reasonable officer in the circumstances would have appreciated the high degree of risk involved; and (4) that by not taking such measures, the defendant caused the plaintiff's injuries.

Here, the individual defendants did not argue that their conduct was unintentional. The Ninth Circuit held there was sufficient evidence for the jury to find the individual defendants knew of the substantial risk of serious harm to Castro and that a reasonable officer would have appreciated the risk. On that basis, the Ninth Circuit found the evidence sufficient to sustain the judgment in favor of Castro.

Claim against the entity defendants: The second issue addressed on appeal was the claim against the entity defendants. Pursuant to the Supreme Court holding in Monell v. Department of Social Services, 436 U.S. 658, 694 (1978), in order to establish municipal entity liability, a plaintiff must show that a "policy or custom" led to the plaintiff's injury. In City of Canton v. Harris, 489 U.S. 378, 392 (1989), the Court further held that the plaintiff must demonstrate that the policy "reflects deliberate indifference to the constitutional rights of its inhabitants."

The Ninth Circuit addressed whether the entity defendants had a policy or custom that caused Castro's injury. The entity defendants argued that the architecture of the West Hollywood police station's sobering cell cannot be a policy, custom, or practice. The Ninth Circuit avoided deciding this question by holding that inadequate audio monitoring of the sobering cell and the policy to check on inmates only every 30 minutes amounted to a "custom or policy" under the standard. Had the entity defendants provided consistent monitoring or had they required Castro and Gonzales to be housed in different cells, the attack could have been averted. Therefore, the entity defendants' custom or policy caused Castro's injury.

Next, the court addressed whether the custom or policy reflected deliberate indifference on the part of the entity defendants. In City of Canton, the Supreme Court articulated a standard for permitting liability on a showing of "actual or constructive notice that the particular omission is substantially certain to result in the violation of the constitutional rights of their citizens." 489 U.S. at 396. In determining whether a policy or custom is adhered to with deliberate indifference, the Court established that an objective standard applies. See Gibson v. County of Washoe, 290 F.3d 1175, 1195 (9th Cir. 2002). The Ninth Circuit found that the West Hollywood police station's manual mandates that a sobering cell allow for maximum visual supervision of prisoner by staff, but the cell was non-compliant in this regard. The manual provision was aimed at mitigating the risk of serious injury to individuals housed in sobering cells. This conclusively showed that the entity defendants knew of the risk of the very type of harm that befell Castro. For these reasons, judgment against the entity defendants was affirmed.


To read the full opinion, please visit:

https://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/15/12-56829.pdf
Panel (en banc): Sidney R. Thomas, Chief Judge, and Susan P. Graber, Ronald M. Gould, Richard A. Paez, Consuelo M. Callahan, Carlos T. Bea, Milan D. Smith, Jr., Sandra S. Ikuta, Paul J. Watford, John B. Owens, and Michelle T. Friedland, Circuit Judges
Argument Date: March 22, 2016

Date of Issued Opinion: August 15, 2016

Docket Number: 12-56829

Decided: Affirmed.

Case Alert Author: Brandon Homan
Counsel: Melinda Cantrall (argued) and Thomas C. Hurrell, Hurrell Cantrall LLP, Los Angeles, California, for Defendants-Appellants
John Burton (argued), Law Offices of John Burton, Pasadena, California; Maria Cavalluzzi, Cavalluzzi & Cavalluzzi, Los Angeles, California; and M. Lawrence Lallande, Lallande Law PLC, Long Beach, California, for Plaintiff-Appellee
David M. Shapiro (argued), Roderick and Solange MacArthur Justice Center, Northwestern University School of Law, Chicago, Illinois; Paul W. Hughes, Mayer Brown LLP, Washington, D.C.; David C. Fathi, ACLU National Prison Project, Washington, D.C.; Peter Eliasberg, ACLU Foundation of Southern California, Los Angeles, California; for Amici Curiae ACLU of Southern California, American Civil Liberties Union, Human Rights Defense Center, National Police Accountability Project, and Roderick and Solange MacArthur Justice Center
Author of Opinion: Circuit Judge Susan P. Graber

Dissent: Circuit Judge Consuelo M. Callahan dissented in part, joined by Judges Carlos T. Bea and Sandra S. Ikuta. Judge Callahan agreed with the judgment against the individual defendants but disagreed as to the entity defendants.

Dissent: Circuit Judge Sandra S. Ikuta dissented, joined by Judges Consuelo M. Callahan and Carlos T. Bea, to express disagreement with in the majority's interpretation of Kingsley v. Hendrickson, 135 S. Ct. 2466 (2015).

Case Alert Supervisor: Philip L. Merkel

    Posted By: Glenn Koppel @ 10/27/2016 03:36 PM     9th Circuit     Comments (0)  

  Dugard v. United States
Dugard v. United States - Ninth Circuit

Headline: A Ninth Circuit panel references California law in holding that the Federal Tort Claims Act ("FTCA") does not impose a duty on the U.S. government to protect the general public from injuries caused by convicts released on parole.

Areas of Law: Federal Tort Claims Act, Sovereign Immunity

Issue Presented: Whether the United States is liable for negligence under the FTCA for its probation officers' failure to control a dangerous parolee where a private individual would not be liable in like circumstances under California law.

Brief Summary: The Ninth Circuit considered the district court's grant of summary judgment finding that federal parole officers are not liable for the actions of parolees under the FTCA. Appellant Jaycee Dugard ("Dugard"), who was kidnapped and imprisoned for 18 years by parolee Phillip Garrido's ("Garrido"), sued the United States on behalf of herself and her minor children claiming that federal parole officers' failure to report Garrido's parole violations caused them injury. The district court granted summary judgment on the grounds that the United States waived sovereign immunity under the FTCA, 28 U.S.C. § 2674, only in cases where a private individual would be liable in like circumstances under applicable state law. The district court found the parole officers would not have been liable under California law.

The Ninth Circuit affirmed. It relied on the language of the FTCA and LeBarge v. Mariposa City, 798 F.2d 364, 367 (9th Cir. 1986), where the Ninth Circuit found a court's job was to apply the "most reasonable analogy" under state law. The court found that federal parole officers are most analogous to private rehabilitation centers, and because such centers would not be liable in similar circumstances under California law, the United States was not liable under the FTCA for the parole officers' conduct.

Significance: The United States is not liable under the FTCA for the negligence of its parole officers in monitoring parolees where there would not be liability in analogous circumstances under applicable state law.

Extended Summary: Garrido served 11 years of a 50-year prison sentence for the kidnapping and rape of two women in 1976. Medical professionals determined that Garrido's sexual violence was exacerbated by abuse of methamphetamines. When Garrido was released on parole in 1988, his parole terms included mandatory drug testing.

In the first 30 months after his release, Garrido's parole officers failed to report approximately 70 drug-related parole violations. While on parole in 1991, Garrido kidnapped Dugard who was age 11. For the next 18 years, Garrido imprisoned Dugard in his backyard where he repeatedly raped and drugged her. Dugard gave birth to two of Garrido's children without any medical treatment. She and her children remained captive until their discovery in 2009.

In September 2011, Dugard sued the United States under the FTCA on her own behalf and as guardian of her children. She alleged that federal parole officers negligently supervised Garrido, including failure to report his numerous parole violations. She alleged that, but for the parole officers' negligence, Garrido's parole would have been revoked and he would have been unable to kidnap Dugard in 1991.

Following discovery, the United States moved for summary judgment on grounds that the FTCA barred Dugard's claims because there is no liability for private individuals in like circumstances under California law, as required to sustain a FTCA claim under 28 U.S.C. § 2674. The district court found private parties providing criminal rehabilitative services to be the reasonable analogy to parole officers under California law. California law holds that such private parties do not owe a duty of reasonable care to control others generally, but only to a very small group of specifically identifiable and foreseeable victims. Since Dugard did not allege she was a specifically identifiable victim, the United States owed no duty of care to Dugard and her children.

On appeal, the Ninth Circuit affirmed the judgment. The court discussed the FTCA by which the United States has waived sovereign immunity in limited cases. The statute provides the United States is liable "in the same manner and to the same extent as a private individual under like circumstances." 28 U.S.C. § 2674. The Court cited LeBarge v. Mariposa City, 798 F.2d 364, 367 (9th Cir. 1986), a Ninth Circuit precedent in which the court held that FTCA claims require courts to adopt a "reasonable analogy" standard when determining if immunity is waived.

The Ninth Circuit panel reasoned that the California cases most analogous to Dugard's situation involved the liability of private criminal rehabilitation facilities. Under California law, such private companies do not owe a duty of care to the public at large for the actions of inmates or parolees under their supervision. Cardenas v. Eggleston Youth Ctr., 238 Cal. Rptr. 251, 252-53 (Ct. App. 1987) (holding that a private rehabilitation facility owes no duty of care to "members of the community in which it is located for the criminal conduct of its residents"); Beauchene v. Synanon Found, Inc., 151 Cal. Rptr. 796, 798-99 (Ct. App. 1979) (holding that a private rehabilitation center owed no duty to the plaintiff to control the behavior of a convict who escaped the facility and shot the plaintiff). Rather, privately owned criminal rehabilitation facilities only owe a duty to individuals who are foreseeable and specifically identifiable victims of their wards' conduct. Vu v. Singer Co., 706 F.2d 1027, 1029 (9th Cir. 1983) (discussing the duty to warn under California law and concluding that it "clearly" requires a "foreseeable and specifically identifiable" victim); Rice v. Ctr. Point, Inc., 65 Cal. Rptr. 3d 312, 316 (Ct. App. 2007) (explaining that a duty exists only where the "injury is foreseeable and the intended victim is identifiable").

The Ninth Circuit panel stated that Dugard neither argued nor submitted facts to suggest that she was a specifically identifiable victim who would have a viable claim against an analogous private party under California law. Because the extent of the federal government's liability under the FTCA is described with reference to state law, when California limited the liability of private rehabilitative institutions, the federal government's liability under the FTCA shrunk as well. The Ninth Circuit panel also noted how limiting liability for officials involved in the release and rehabilitation of criminal offenders is consistent with California's public policies that encourage criminal rehabilitation. To hold otherwise would force the range of goals to shift from rehabilitation to protecting the public, thereby disrupting the ability of probation officers to develop flexible and appropriately tailored approaches suited for each offender. This would be a disservice to both the offenders and society.

To read the full opinion, please visit:

https://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/26/13-17596.pdf

Panel: William E. Smith, Chief District Judge of Rhode Island sitting by designation, and Richard R. Clifton, John B. Owens, Carlos T. Bea, Circuit Judges

Argument Date: January 12, 2016

Date of Issued Opinion: August 26, 2016

Docket Number: 13-17596

Decided: Affirmed

Case Alert Author: Devin Bruen

Counsel:
In No. 13 - 17596: Jonathan P. Steinsapir (argued), Dale F. Kinsella, Amber Holley Melius, and David W. Swift, Kinsella Weitzman Iser Kump & Aldisert, LLP, Santa Monica, California, for Plaintiff-Appellant

Patrick G. Nemeroff (argued) and Mark B. Stern, Attorneys, Appellate Staff, Civil Division, Department of Justice, Washington, D.C., for Defendant-Appellee

Author of Opinion: Judge Owens

Dissent: Judge Smith

Case Alert Supervisor: Philip L. Merkel

    Posted By: Glenn Koppel @ 10/27/2016 03:35 PM     9th Circuit     Comments (0)  

  Preap v. Johnson
Headline: Ninth Circuit holds immigration authorities may detain criminal aliens without a bond hearing only when aliens are detained promptly after their release from criminal custody.

Area of Law: Immigration Law

Issue Presented: Whether the phrase "when the alien is released" in the mandatory detention provision of 8 U.S.C. § 1226(c)(1) permits the government to detain individuals without a bond hearing long after they were released and resettled in the community.

Brief Summary: The Ninth Circuit panel affirmed the district court's finding that the phrase "when...released" in the mandatory detention provision without a bond hearing applies only when immigration detention takes place promptly after release, as opposed to sometime long after. The plaintiffs in the class action were convicted of crimes, served their sentences, and had been released and returned to the community for years before they were arrested and detained by immigration authorities under the mandatory detention provision. The plaintiffs argued that the phrase "when...released" allowed for detention without a bond hearing only when promptly detained after release from criminal custody. The government countered that the statute gave immigration authorities the power to detain without a bond hearing at any time after release. The Ninth Circuit panel considered the text of the statute, the context, and the legislative intent, and held that the legislature intended for the provision to apply only to those criminal aliens who were promptly detained after release from criminal custody. However, the Ninth Circuit panel avoided defining the parameters of what "promptly" would entail, as it was not an issue before the court.

Significance: Criminal aliens who have been released after serving their sentences and long since reentered society may not be detained without a bond hearing. Mandatory detention without a bond hearing as provided under 8 U.S.C. § 1226(c) only applies when the government promptly detains a criminal alien after the individual's release from custody.

Extended Summary: The named plaintiffs in this class action, Mony Preap ("Preap"), Eduardo Vega Padilla ("Padilla"), and Juan Lozano Magdaleno ("Magdaleno") are lawful permanent residents who committed crimes that may lead to their removal from the United States. Upon serving their criminal sentences, plaintiffs returned to their communities where they remained for years. Immigration authorities later took plaintiffs into custody and held them without bond hearings under the mandatory detention provision.

Preap is a lawful resident of the United States since 1981. In 2006 he was twice convicted of possession of marijuana and served both sentences. Years after being released, Preap served a sentence for simple battery, a crime not enumerated in the mandatory detention statute. Upon release, he was held without a bond hearing in immigration detention. Padilla has also been a lawful resident for 30 years. He has convictions for drug possession and owning a firearm with a prior felony conviction. Eleven years after finishing his last criminal sentence, he was placed in mandatory detention. Magdaleno, a lawful resident since 1974, has convictions for owning a firearm with a prior felony conviction and possession of a controlled substance. Magdaleno served his sentence and was released. Over five years later, immigration authorities took him into custody and held him without a bond hearing.

Plaintiffs filed a class action petition for habeas relief in the United States District Court for the Northern District of California. The motion for class certification was granted, and a preliminary injunction was issued requiring all class members to be provided a bond hearing under § 1226(a). The class extended to all "ndividuals in the state of California who are or will be subjected to mandatory detention under 8 U.S.C. section 1226(c) and who were not or will not have been taken into custody by the government immediately upon their release from criminal custody for a § 1226(c)(1) offense." Preap v. Johnson, 303 F.R.D. 566, 571, 584 (N.D. Cal. 2014).

The Immigration and Naturalization Act's ("INA") mandatory detention provision, 8 U.S.C. § 1266(c), requires immigration authorities to detain aliens who have committed an offense enumerated in the INA, and to do so "when the alien is released" from criminal custody, without bond. Enumerated offenses range from serious felonies to simple possession of a controlled substance.

The mandatory detention provision has survived several challenges over the years, and has even gone to the Supreme Court of the United States to test its constitutionality. Here the Ninth Circuit panel considered whether the phrase "when [they are] released" in the mandatory detention provision requires that the government detain even those aliens that have resettled into the community. If it does not, then the alien may still be detained, but subject to a bond hearing wherein the alien must show he poses neither a risk of flight nor a danger to the community.

In considering this issue, the Ninth Circuit panel looked to the text of the two relevant statutory provisions. 8 U.S.C. § 1226(a) requires the Attorney General to detain any alien upon the initiation of removal proceedings, and choose to keep the individual in detention or release on conditional parole or bond. The alien may seek review of the Attorney General's decision by an immigration judge, but the immigration judge must consider whether the alien "is a threat to national security, a danger to the community at large, likely to abscond, or otherwise a poor bail risk." Matter of Guerra, 24 I. & N. Dec. 37, 40 (BIA 2006); see also 8 § C.F.R. 1236.1(c)(8). The second relevant provision is 8 U.S.C. § 1226(c). Section 1226(c)(1) requires the Attorney General to "take into custody" any alien who has committed an enumerated offense "when the alien is released" from criminal custody. Section 1226(c)(2) prohibits the Attorney General from releasing an alien described in § 1226(c)(1) except for certain aliens in the Federal Witness Protection Program.

Plaintiffs argued that the text "when...released" in § 1226(c)(1) also applies to § 1226(c)(2), thereby allowing aliens to be detained without bond only if they are taken into immigration custody promptly after release from criminal custody. The government, on the other hand, argued that the phrase "when...released" meant that an alien may be held without bond regardless of how much time has passed between criminal custody and immigration custody.

The Ninth Circuit noted a split in authority among United States Circuit Courts of Appeals on this issue. Of the five circuits that have considered the issue, four circuits (the Second, Third, Fourth, and Tenth) sided with the government, while the First Circuit sided with the plaintiffs' position.

The Ninth Circuit panel agreed with the First Circuit's conclusion in Castañeda v. Souza, 810 F.3d 15 (1st Cir. 2015) that the statutory context and legislative history make it clear that the provision allows for a criminal alien to be held without bond only if detained "when...released" from criminal custody, not after a lengthy gap in time. In its opinion, the Ninth Circuit considered and rejected three arguments the government advanced in support of its position: (1) that the court should give Chevron deference to the Board of Immigration Appeals' ("BIA") interpretation; (2) that the phrase "when...released" triggers a duty, rather than a time limit; and (3) even if Congress intended that immigrations promptly detain criminal aliens when they are released, it did not intend that they would lose the authority to do so in the event of delay.

The first issue is whether courts should defer to the BIA's interpretation of § 1226(c)(2) to include any alien described in § 1226(c)(1) as subject to detention without bond, regardless of when the alien was taken into immigration custody. (The Second and Tenth Circuits based their decisions on Chevron deference.) See Lora v. Shanahan, 804 F.3d 601, 612 (2d Cir. 2015); Olmos v. Holder, 780 F.3d 1313, 1322 (10th Cir. 2015). In addressing this issue, the Ninth Circuit panel looked to the text of the statute and the legislative intent and noted that § 1226(c)(2) refers to "an alien described in paragraph (1)" rather than the select subsections within it, and that the legislature must have deliberately selected this language to include the phrase "when...released." Because Congress did not choose to qualify the description of an alien to be those in §§ 1226(c)(1)(A) through 1226(c)(1) (D), the Court included the breadth of § 1226(c)(1) in its interpretation, thus holding that the plain meaning is for the provision to apply to criminal aliens "when...released."

The context of the statute supported this decision, as § 1226(a) provides authority for the detention of any alien in removal proceedings and § 1226(c) provides for the mandatory detention in limited circumstances. Sections 1226(a) and 1226(c) each have their own provisions for both the detention and release of aliens. Thus if the government fails to detain an alien "when...released" under § 1226(c)(2), then the government's authority to do so under § 1226(c) is lost, and the government must proceed under § 1226(a) with a bond hearing provided.

The Ninth Circuit also addressed the BIA's interpretation that authorities may detain on the authority of § 1226(a) while applying the release conditions of § 1226(c)(2). The Board's interpretation was dismissed by looking at the structure of the statute and how § 1226(c) as a whole is entitled "Detention of criminal aliens." The Ninth Circuit panel found this wording as creating an exception to the general rule in § 1226(a). As such, the Ninth Circuit panel found that the provisions in § 1226(c)(2) go into effect only where § 1226(c)(1) is satisfied. The Board's interpretation was further dismissed because following the interpretation would render the "when...released" clause inoperative, and would thereby eliminate any requirement that the alien ever be in custody.

The second issue was whether the phrase "when...released" triggered a duty, rather than a time limit, as the Fourth Circuit held in Hosh v. Lucero, 680 F.3d 375, 380 - 81 (4th Cir. 2012). Plaintiffs argued that there is a time limit under which the government must take criminal aliens into immigration custody promptly after release, as opposed to many years later as was done with Plaintiffs. The government argued that the phrase was ambiguous and allowed for both Plaintiffs' interpretation and for the detention at any time after release from criminal custody.

The Ninth Circuit looked to the plain language of the statute and noted that Congress chose the word "when," which suggests a degree of immediacy as opposed to a condition; it did not use phrases such as "in the event of" or "any time after." Congress's purpose in choosing the words "when...released" sets forth a requirement of promptness because the mandatory detention provision's purpose is to address criminal aliens that present an immediate danger or pose a flight risk. It could not have been Congress's intent to allow the delayed detention of such aliens. Those not detained promptly after release are entitled to a bond hearing.

The third issue was whether the delay in prompt detention deprived immigration authorities of the authority to do so. The government argued that the failure to act as required in § 1226(c)(1) does not preclude them to act under § 1226(c)(2). The Second, Third, and Tenth Circuits have also previously held that it does not. See Sylvain v. Atty Gen. of United States, 714 F.3d 150, 157 (3d Cir. 2013); Lora, 804 F.3d at 612; Olmos, 780 F.3d at 1325 - 26. These circuits relied on United States v. Montalvo-Murillo, 495 U.S. 711 (1990). In Montalvo-Murillo, the Supreme Court considered whether a defendant who did not receive a timely hearing immediately upon the first appearance as required by the Bail Reform Act may be released from custody. The Supreme Court held that "a failure to comply with the first appearance requirement does not defeat the government's authority to seek detention of the person charged." 495 U.S. at 717.

The Ninth Circuit panel distinguished Montalvo-Murrillo from the instant case, finding that the sole practical effect of the district court's decision was to reinstate the government's authority under § 1226(a) as to those not timely detained under § 1226(c), and thus there was no loss of authority. Further, while there was no remedy to a delayed hearing in Montalvo-Murrillo, here the statutory structure makes clear exactly what occurs if a prompt detention under § 1226(c) does not occur - the general detention provision of § 1226(a) applies.

The Ninth Circuit panel rejected the argument that not applying the loss-of-authority doctrine would cause dangerous aliens to be eligible for hearings because the design of the mandatory detention provision is aimed towards the detention of criminal aliens who are recently released and are a risk. According to the court, the more time such individuals have spent in the community leading free and productive lives, the less likely they are to be dangerous and enough of a flight risk to warrant the application of the loss-of-authority doctrine.

In conclusion, the Ninth Circuit panel held that the mandatory detention provision of § 1226(c) applies only to those criminal aliens who are detained promptly after their release from criminal custody. However, the Ninth Circuit panel left undefined, the determination of what period of time is sufficient to meet the requirement that such detainment is "promptly" done, as that was not at issue before the court.

To read the full opinion, please visit:

https://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/04/14-16326.pdf

Panel: Andrew J. Kleinfeld, Jacqueline H. Nguyen, and Michelle T. Friedland, Circuit Judges

Argument Date: July 8, 2015

Date of Issued Opinion: August 4, 2016

Docket Number: 14-16326; 14-16779

Decided: Affirmed

Case Alert Author: Edwin Hong

Counsel:
Hans Harris Chen (argued) and Troy D. Liggett, Trial Attorneys; Elizabeth J. Stevens, Assistant Director; William C. Peachey, Director, District Court Section; Civil Division, Office of Immigration Litigation, United States Department of Justice, Washington, D.C.; for Defendants-Appellants

Theresa H. Nguyen (argued) and Ashok Ramani, Keker & Van Nest LLP, San Francisco, California; Michael K.T. Tan, ACLU Immigrants' Rights Project, New York, New York; Julia Harumi Mass, ACLU Foundation of Northern California, San Francisco, California; Anoop Prasad, Asian Law Caucus, San Francisco, California; for Plaintiffs- Appellees

Author of Opinion: Judge Jacqueline H. Nguyen

Circuit: Ninth Circuit

Case Alert Supervisor: Philip L. Merkel

    Posted By: Glenn Koppel @ 10/27/2016 03:32 PM     9th Circuit     Comments (0)  

  Tompkins v. 23andME, Inc.
Headline: Ninth Circuit panel holds pursuant to the Federal Arbitration Act, 9 U.S.C. § 2 ("FAA") and California's unconscionability rules that provisions in a mandatory arbitration clause in an online consumer contract of adhesion are valid and enforceable.

Areas of Law: Arbitration; Unconscionability; Federal Arbitration Act.

Issues Presented: (1)Whether provisions in an online mandatory arbitration clause authorizing an award of attorney fees and costs to the prevailing party, designating the forum for arbitrations, and excluding intellectual property disputes from arbitration are unconscionable. (2) Whether other provisions of the online agreement establishing a one-year statute of limitations and giving 23andMe a unilateral right to modify the contract render the arbitration provision unconscionable.

Brief Summary: Plaintiffs are customers of 23andMe, Inc., who purchased DNA test kits on-line. They filed a class action lawsuit claiming that provisions of their agreement with 23andMe relating to mandatory arbitration are unconscionable in the following respects: authorizing attorney fees and costs to the prevailing party; establishing San Francisco as the forum for arbitration proceedings; and exempting from mandatory arbitration any disputes relating to intellectual property rights, obligations, or any infringement claims. Plaintiffs also claimed that other contract provisions establishing a one-year statute of limitations period and giving 23andMe a unilateral right to modify the agreement rendered the arbitration clause unconscionable. 23andMe responded with a motion to compel arbitration. The district court granted 23andMe's motion and plaintiffs appealed.

The Ninth Circuit panel recognized that the Federal Arbitration Act, 9 U.S.C. § 2, establishes a strong national policy favoring arbitration. A court may invalidate an arbitration agreement under the "savings clause" of § 2 only in cases where generally applicable contract defenses such as fraud, duress, or unconscionability are present. The court then examined California law to determine whether the provisions would be held unconscionable under that state's law.

The Ninth Circuit concluded that the provision awarding attorney fees and costs to the prevailing party is not unconscionable under California law. Although California appellate courts have held unilateral cost shifting clauses in the arbitration context to be unconscionable, the plaintiffs failed to show the unconscionability doctrine's application in bilateral provision cases. The court also rejected plaintiffs' claim that the fees and costs to the losing party would be too great for plaintiffs to bear as they failed to provide evidence on this point. Second, the Court held that plaintiffs did not prove that the cost and inconvenience of having arbitrations in San Francisco was unreasonable. Third, plaintiffs failed to identify or raise any intellectual property claims that 23andMe might bring against them.

The court next addressed the contract provisions creating the one-year statute of limitations and giving 23andMe the unilateral right to modify the contract. The Ninth Circuit noted that, as a general rule, where the arbitration agreement itself is not unconscionable, provisions outside the arbitration agreement will not make it so. The court relied on California case precedents in finding the one-year statute of limitations was not unconscionable. It also held that plaintiffs could challenge the enforceability of the modification clause in the arbitration proceeding.

Significance: Consumer contracts formed online between individuals and corporations often include mandatory arbitration clauses. The Federal Arbitration Act established a strong national policy favoring arbitration. Federal courts will enforce a mandatory arbitration clause unless an aggrieved party can prove the provision is procedurally and substantively unconscionable under relevant state law.

Extended Summary: 23andMe sold DNA testing kits to customers online through its website. It claimed its service could assist customers in managing health risks as well as preventing or mitigating certain diseases. Before a customer could purchase the kit, the individual was required to click on a link to the company's terms of service and check a box that acknowledged the buyer's assent to the terms. The agreement included a mandatory arbitration provision. The provision authorized an award of fees and costs to the prevailing party and required that arbitration proceedings be governed by California law and held in San Francisco, California. The arbitration clause specifically excluded from arbitration "disputes relating to intellectual property rights, obligations, or any infringement claims." Other contract provisions established a one-year statute of limitations and gave 23andMe a unilateral right to modify the agreement.

In November 2013, the Food and Drug Administration ordered 23andMe to discontinue marketing its services for health purposes until it obtained government approval. Plaintiffs are customers who had purchased DNA test kits online. They brought a number of class action suits against 23andMe, alleging unfair business practices, breach of warranty, and misrepresentation. By agreement, all claims were consolidated in the United States District Court for the Northern District of California.

23andMe filed a motion to compel all plaintiffs to arbitrate their claims. Plaintiffs responded that the mandatory arbitration provision and other clauses of the agreement were unconscionable. The district court found for 23andMe and granted its motion to compel arbitration. Plaintiffs filed a timely appeal.

The Ninth Circuit affirmed the district court decision. The court began its opinion by recognizing that § 2 of the FAA "is a congressional declaration of a liberal federal policy favoring arbitration agreements." Any doubts about the scope of arbitrable issues, including applicable contract defenses, are to be resolved in favor of arbitration. Moses H Cone Memorial Hospital v. Mercury Construction Co., 460 U.S. 1, 24-25 (1983). The court noted that the "savings clause" of § 2 authorizes a court to strike or limit an arbitration provision only in instances involving generally applicable contract defenses, such as fraud, duress, or unconscionability. It held that a federal court must look to relevant state law in deciding whether an arbitration provision is unconscionable. For this reason, the Ninth Circuit examined California authorities to decide whether provisions of the arbitration clause in the instant case were unconscionable.

Under California law, the doctrine of unconscionability is applicable if the written contract is both procedurally and substantively unconscionable, though they need not be present to the same degree. Procedural unconscionability focuses on oppression or surprise due to unequal bargaining power while substantive unconscionability relates to overly harsh or one-sided results. Sanchez v. Valencia Holding Co., 61 Cal. 4th 899, 910 (2015).

The Ninth Circuit first examined the provision in the arbitration clause stating "arbitration costs and reasonable documented attorneys' costs of both parties will be borne by the party that ultimately loses." Plaintiffs contended that if they lost, the arbitrators' charge of $1,500 per day and 23andMe's "top tier" lawyers' fees would be unreasonable, overly burdensome, and unfair. The Ninth Circuit panel reviewed relevant California authorities and found that a number of courts had enforced prevailing party clauses in the non-arbitration context. In cases involving arbitration, several California appellate courts held cost shifting clauses unconscionable where they were unilateral, thus available to only one side. But plaintiffs were unable to produce any case where a bilateral clause awarding attorney fees and costs to the prevailing party was unconscionable. Indeed, Cal. Civil Code § 1717 appears to approve bilateral prevailing party clauses. For these reasons, the Ninth Circuit concluded that the bilateral prevailing party clause in this case was not unconscionable. The court also held that plaintiffs did not offer evidence to show that the arbitration costs and attorney fees would be unaffordable or thwart their ability to arbitrate the dispute.

Next, the Ninth Circuit addressed plaintiffs claim that the designation of San Francisco as the forum for arbitration was unconscionable. It discussed the California Supreme Court's decision in Valentino & Smith, Inc. v. Superior Court, 17 Cal. 3d 491 (1976), which rejected plaintiff's claim that a venue clause was unenforceable because of inconvenience and expense of the forum. In the absence of a showing that such a clause is unreasonable, a forum selection clause is generally valid and enforceable. Further case analysis indicates that the plaintiff has a heavy burden of proof to show a forum-selection clause is unconscionable. This is so even if the clause appears in an adhesion contract. Mere inconvenience or additional expense is not the test. So long as the party had adequate notice as to the forum's location, the clause is enforceable. Here, the Ninth Circuit panel concluded that San Francisco was not an unreasonable choice. San Francisco has a proper connection to the contract as it is 23andMe's principal place of business, seven of the plaintiffs reside in California, and six of the nine actions were filed in California. In addition, the two affidavits claiming financial hardship did not explain why the expense of travelling to the San Francisco venue would be burdensome.

The final arbitration clause provision discussed by the Ninth Circuit exempted "any disputes relating to intellectual property rights, obligations, or any infringement claims" from mandatory arbitration. The court cited California authority stating that substituting arbitration for litigation resulted in no inherent disadvantage. Sonic-Calabasas A, Inc. v. Moreno, 57 Cal. 4th 1109,1152 (2013). Moreover, a one-sided contract is not necessarily unconscionable. The Ninth Circuit also found that the plaintiffs did not identify any intellectual property right that 23andMe was likely to bring against its customers. The rights that were included in arbitration are ones that the plaintiffs are likely to sue on and there was therefore a bilateral aspect to the clause. 23andMe demonstrated the need for the clause since it provided its business with a "margin of safety," which in itself, was not unconscionable. For these reasons, the court held the arbitration clause was enforceable.

The plaintiffs also challenged contract terms creating the one-year statute of limitations and the unilateral right of 23andMe to modify the agreement. The plaintiffs contended that these two provisions rendered the arbitration clause unconscionable. The Ninth Circuit reviewed these issues and ruled that both were enforceable. The court cited Rent-A-Center, W, Inc. v. Jackson, 561 U.S. 63, 70-71 (2010), where the Supreme Court held that a party's challenge to a contract provision or to the contract as a whole does not prevent a court from enforcing an agreement to arbitrate. It cited California authority showing that it was not unconscionable for parties in contractual relations do modify a statute of limitations. The one-year statute of limitations in this case was bilateral; it applied to both parties and both parties had adequate notice and agreed to the provision. As for the provision granting 23andMe the unilateral right to modify the contract, even if this clause is unconscionable, it would not make the arbitration provision or the contract as a whole unenforceable. The Ninth Circuit decided that the plaintiffs are free to argue during arbitration that the unilateral modification clause itself is unenforceable and did not reach that claim in the appeal.

For these reasons, the Ninth Circuit affirmed the district court's decision to grant the motion to compel arbitration.

To read the full opinion, please visit:
https://cdn.ca9.uscourts.gov/datastore/opinions/2016/08/23/14-16405.pdf

Panel: Stephen S. Trott, Sandra S. Ikuta, and Paul J. Watford, Circuit Judges.

Argument Date: May 12, 2016

Date of Issued Opinion: August 23, 2016

Docket Number: 14-16405

Decided: Affirmed.

Case Alert Author: David Griego

Counsel: Jeremy Robinson (argued), Jason C. Evans, and Gayle M. Blatt; Casey, Gerry, Schenk, Francavilla, Blatt &Penfield, LLP, San Diego, California; Mark Ankcorn, Ankcorn Law Firm, PC, San Diego, California; for Plaintiff-Appellant

Robert P. Varian (argued), James N. Kramer, M. Todd Scott, and Alexander K. Talarides; Orrick Herrington & Sutcliffe, LLP, San Francisco, California, for Defendant-Appellee

Author of Opinion: Judge Ikuta

Concurrence: Judge Watford

Circuit: Ninth

Case Alert Supervisor: Philip L. Merkel

    Posted By: Glenn Koppel @ 10/27/2016 03:28 PM     9th Circuit     Comments (0)  

October 26, 2016
  Zaloga v. Borough of Moosic - Third Circuit
Headline: Third Circuit rules that retaliation for free speech does not alone overcome qualified immunity doctrine.

Area of Law: Qualified Immunity, Constitutional Law

Issues Presented: Does qualified immunity extend to a government actor's retaliation against a plaintiff for use of free speech?

Brief Summary: The owner of a medical company that serviced Lackawanna County prison engaged in a political dispute with members of Moosic Borough's government. In retaliation, those parties attempted to end his contract with the prison, and he sued for violation of his First Amendment rights. The Third Circuit ruled that the nature of the constitutional principles at play did not create a right clear enough to overcome the reasonableness standard created by the qualified immunity doctrine.

Extended Summary: Plaintiff Dr. Edward Zaloga is the owner of Correctional Care, Inc., a company that services the medical needs of correctional facilities. While living in Moosic Borough in Lackawanna County, his company contracted with Lackawanna County prison. Plaintiff became involved in a dispute with a tire company whose facility was immediately adjacent to his home. He was dissatisfied with the Borough's handling of the situation and began political attacks against the president of the borough council and the mayor.

A month later Plaintiff was informed by the county solicitor that Lackawanna County would not continue its contract with his company upon its expiration. He was also told that he could bid for the contract against other similar companies, but learned from a prison board member that his political opponents were working to block his contract renewal by contacting members of the board and gaining their support. The contract was ultimately renewed in 2009 and again in 2015.

Plaintiff filed a complaint in 2010 for alleged violations of his First and Fourteenth Amendment rights. Defendants moved for summary judgment. That motion was granted in part and denied in part, with the court ruling that the jury should decide whether one defendant was entitled to qualified immunity from suit.

The Third Circuit began by explaining that qualified immunity only shields government agents from suit insofar as their conduct does not violate "clearly established statutory or constitutional rights of which a reasonable person would have known." Harlow v. Fitzgerald, 457 U.S. 800, 818 (1982). To determine qualified immunity, the court first examines whether the facts show a violation of the plaintiff's constitutional rights. Second, the court evaluates whether those rights were clearly established in the specific context of the case.

The Court held that because the district court's analysis was mistaken as to the second part of the analysis there was no need to analyze the first. The Court explained that qualified immunity is meant to protect government workers who make mistakes but not those who are plainly incompetent or who knowingly violating the law. Thus, the constitutional right must be clearly established. "[T]he contours of that right must be clear to a reasonable official" so that such officials can be expected not to violate that right. Reichle v. Howards, 132 S. Ct. 2088, 2094 (2012). It is not enough that there is a well-established right against retaliation by a state actor for free speech; this right must be understood by a reasonable state actor.

Turning to Third Circuit precedent, the Court concluded that retaliation for free speech must be of a particularly virulent character to violate a constitutional right. That actor must coerce or threaten a third party to act in order for that conduct to be actionable. McLaughlin v. Watson, 271 F.3d 566 (3d. Cir. 2001). The case at hand involved no such coercion or threats. Furthermore, it has never been established that a governmental official who takes no direct action beyond pressuring others to act can be held personally liable.

To read the full opinion, please visit http://www2.ca3.uscourts.gov/opinarch/152723p.pdf

Panel (if known): Smith, Jordan, Rendell

Argument Date: July 12, 2016

Date of Issued Opinion: October 24, 2016

Docket Number: 15-2723

Decided: Reversed and Remanded

Case Alert Author: John Farrell

Counsel: Joshua M. Autry, Esq. [Argued], Counsel for Appellants; Bruce L. Coyer, Esq., Joseph T. Healy, Esq. [Argued], Counsel for Appellees

Author of Opinion: Judge Jordan

Circuit: Third Circuit

Case Alert Supervisor: Professor Mary E. Levy

    Posted By: Susan DeJarnatt @ 10/26/2016 12:34 PM     3rd Circuit     Comments (0)  

  EMI Christian Music Grp., Inc. et al. v. MP3tunes, LLC et al.
Headline: Second Circuit Vacates District Court's Interpretation of "Repeat Infringer" Under the Digital Millennium Copyright Act

Area of Law: Copyright

Issues Presented: Are internet users who download or copy songs for personal entertainment purposes "repeat infringers" under the safe harbor provision of the DMCA?

Brief Summary: MP3tunes operated two websites: MP3tunes.com and sideload.com. MP3tunes.com was primarily a "locker storage" service, which allowed users to store their music on the MP3tunes server and access it from internet-connected devices. Sideload.com provided a search function to users, allowing them to locate free music on the internet. Sideload.com contained a plug-in allowing users to upload music they found to their MP3tunes.com "locker." Music located in MP3tunes.com users' lockers was also searchable by Sideload.com. A group of record companies and music publishers filed a copyright infringement lawsuit against MP3tunes and its CEO, Michael Robertson. On cross motions for summary judgment, a district court for the Southern District of New York granted the motion in part, finding that MP3tunes qualified for safe harbor protection under the Digital Millennium Copyright Act ("DMCA") because MP3tunes reasonably implemented a "repeat infringer" policy. The Second Circuit found the District Court had construed too narrowly the definition of "repeat infringer" and vacated the District Court's grant of partial summary judgment. To read the full opinion, please visit: http://www.ca2.uscourts.gov/de...33068d9fd4f/1/hilite/


Extended Summary: MP3tunes was founded in 2005 by Michael Robertson. MP3tunes operated two websites. The first, MP3tunes.com, evolved into a "locker storage" service for its users. MP3tunes.com users could upload their songs to the MP3tunes.com server and access them from any internet-connected device. Sideload.com, however, provided a search function for free music to its users. Embedded in the sideload.com website was a feature that enabled users to upload music they found to their MP3tunes.com "locker." The addition of songs to individual users' lockers added to the number of searchable songs in sideload.com's index. Songs uploaded to MP3tunes.com lockers from sideload.com also had the benefit of not being counted towards storage allotments for the user. Since sideload.com was the primary driver of traffic to MP3tunes.com, MP3tunes encouraged users to upload songs from their own accounts.

The District Court found that MP3tunes was afforded the safe harbor protection under the DMCA, which the plaintiffs challenged on appeal. The DMCA provides a safe harbor for internet service providers that "adopt[] and reasonably implement[] . . . a policy that provides for the termination in appropriate circumstances of subscribers and account holders of the service provider's system or network who are repeat infringers." 17 U.S.C. § 512(i)(1)(A). Plaintiffs asserted that MP3tunes failed to satisfy the safe harbor requirements relating to users who created links to infringing content in the sideload.com index.

The District Court found that users who downloaded or copied "songs from third-party sites for their personal entertainment" could not be "repeat infringer[s]." Furthermore, the District Court found that only users who uploaded content are "blatant infringers that internet service providers are obligated to ban from their websites."

The Second Circuit rejected the District Court's definition of "repeat infringer." The DMCA does not define "repeat infringers." Accordingly, the Second Circuit analyzed the term given its ordinary meaning, finding that repeatedly uploading or downloading copyrighted material for personal use does suffice to be found a "repeat infringer." The broader reading of "repeat infringer" is also supported by the structure and context of the DMCA, which relieves service providers from needing to ascertain the users' knowledge to qualify for the safe harbor provision. The Second Circuit also found the legislative history to be in accord with the broader reading of "repeat infringer," while no other circuit had constrained the definition of "repeat infringer" to encompass only willful infringers.

On the motion for summary judgment, MP3tunes offered evidence that they had terminated 153 users who shared their MP3tunes.com passwords. Plaintiffs, however, showed that MP3tunes took no action to try and connect infringing activity (which MP3tunes learned about through various takedown notices) and users who created links to that content. Therefore, a jury could reasonably infer that MP3tunes knew - or consciously avoided knowing - of specific repeat infringers and failed to take action. Accordingly, the Second Circuit vacated the District Court's finding and remanded the case for further proceedings.

Panel: Circuit Judges Cabranes, Straub, and Lohier

Argument Date: May 11, 2016

Date of Issued Opinion: October 25, 2016

Docket Numbers: 12-4369-cv(L), 14-4509-cv(XAP)

Decided: Affirmed in part, Vacated in part, Reversed in part, and Remanded in part.

Case Alert Author: Scott L. Wenzel

Counsel: Andrew H. Bart, Jenner & Block LLP for Plaintiffs-Appellees-Cross-Appellants; Ira S. Sacks, Ackerman LLP for Defendant-Appellant-Cross-Appellee.

Author of Opinion: Judge Lohier

Circuit: Second Circuit

Case Alert Circuit Supervisor: Emily Gold Waldman

    Posted By: Emily Waldman @ 10/26/2016 08:14 AM     2nd Circuit     Comments (0)  

October 25, 2016
  Sixth Circuit strikes down canons limiting judicial campaign speech
Case: Winter v. Wolnitzek

Area of law: First Amendment, judicial campaign speech, ethics

Issue presented: Can a state lawfully bar a judicial candidate or judge from endorsing or openly affiliating with a political candidate or party, contributing to political organizations, committing to case rulings, or making misleading or false statements?

Brief summary: In Kentucky, an appointed judge sought to be "re-elected." During her campaign, she promised to work with the legislature to ensure stiff penalties for drug dealers. Similarly, two aspiring judges wanted to hold fund raisers, receive political endorsements, and give speeches in support of their political party. They also wanted to hold leadership positions in their political party. The Kentucky Commissioner notified all three that their actions violated ethics canons. The three candidates challenged the canons on free-speech grounds.

The Sixth Circuit held that clauses restricting campaigning, speeches, false statements, misleading statements, and case "commits" were unconstitutional. But the contributions clause, the endorsements clause, and the leadership clause were narrowly tailored to protect Kentucky's compelling interests and, therefore, were constitutional.

Extended summary: A first-term appointed judge, who was asking voters to "re-elect" her, and two aspiring judges, who wanted their party affiliations known, challenged Kentucky's judicial canons. The canons bar partisan campaigning, partisan endorsements, partisan political contributions, making commitments on cases, and making false or misleading statements.

The appointed judge was advertising her "re-election" campaign, through which she was committing to ensuring that drug dealer received stiff penalties. In a letter from her state's Commissioner, however, she was told that seeking re-election was misleading because she had been initially appointed to her judgeship, not elected. The Commissioner also said that her drug-sentencing commitments were impermissible because her stiff-penalties comment addressed an issue that was likely to come before her in her court.

The two aspiring judges wanted to hold fundraisers, receive endorsements, give speeches to support their political parties, and hold leadership positions within their political parties. Citing bans on these actions in the Kentucky canons, the Commissioner also sent the aspiring judges reprimand letters.

The three candidates sued, arguing that the Kentucky canons violated of their free-speech rights. Because each issue involved free speech, the Sixth Circuit applied a strict-scrutiny analysis.

The Sixth Circuit held that the campaigning clause, which bars political affiliation, and the commits clause, which bans comments on issues likely to come before a court, were both vague, making them unconstitutionally overbroad. And the court found that the speeches clause, which the court believed did both too much and too little to bar judges from making political speeches, was facially invalid.

On the other hand, the contributions clause that bars judges and judicial candidates from seeking election contributions was upheld by the Sixth Circuit because it takes a narrow approach to resolve the state's compelling interest in preventing judicial races as being seen as part of partisan politics and maintaining impartiality. Likewise, the endorsements clause was upheld because it narrowly addresses the state's compelling interest to keep judges from trading political favors, which could lead to the appearance of quid-pro-quo politics.

The leadership clause that prohibits a judge from acting as a political leader was also upheld because a judge or a judicial candidate does not have the fundamental right to lead campaign-donation solicitations, which allows the judge or judicial candidate to assume a powerbroker roll.

The false-statements clause that prohibits a judge from knowingly or recklessly making false statements during a campaign was upheld because the state's compelling interest in preserving public confidence was narrowly met by this canon. Yet the Sixth Circuit did not believe that the appointed judge violated this clause because a common dictionary meaning of "re-elect" supported her word choice.

As for the misleading-statements clause, the Sixth Circuit determined that only a ban on conscious, intentional falsehoods could satisfy strict scrutiny.

Panel: COLE, Chief Judge; SUTTON and COOK, Circuit Judges.

Date of issued opinion: August 24, 2016

Docket numbers: 15-5836/5839/5841

Decided: August 24, 2016

Decision: Affirmed in part, reversed in part, and vacated in part with a remand to the district court for further consideration in part.

Counsel: Jeffrey C. Mando, ADAMS, STEPNER, WOLTERMANN & DUSING, PLLC,
Covington, Kentucky, for Appellants/Cross-Appellees. Mark R. Overstreet, STITES &
HARBISON, PLLC, Frankfort, Kentucky, for Appellants/Cross-Appellees as to all claims except
those asserted by Judge Jones. Christopher Wiest, CHRIS WIEST, AAL, PLLC, Crestview
Hills, Kentucky, for Appellees/Cross-Appellants. ON BRIEF: Jeffrey C. Mando, ADAMS,
STEPNER, WOLTERMANN & DUSING, PLLC, Covington, Kentucky, for Appellants/Cross-
Appellees. Mark R. Overstreet, STITES & HARBISON, PLLC, Frankfort, Kentucky, Bethany
A. Breetz, STITES & HARBISON, PLLC, Louisville, Kentucky, for Appellants/Cross-
Appellees as to all claims except those asserted by Judge Jones. Christopher Wiest, CHRIS WIEST, AAL, PLLC, Crestview Hills, Kentucky, Jack S. Gatlin, GATLIN VOELKER, PLLC,
Ft. Mitchell, Kentucky, for Appellees/Cross-Appellants.

Author of opinion: SUTTON, Circuit Judge.

Case alert author: Peter J. Mancini, Western Michigan University Cooley Law School

Case alert circuit supervisor: Professor Mark Cooney

Link to the case: http://www.opn.ca6.uscourts.go...ns.pdf/16a0206p-06.pdf

    Posted By: Mark Cooney @ 10/25/2016 04:48 PM     6th Circuit     Comments (0)  

October 24, 2016
  Sixth Circuit strikes down Memphis's "Beale Street Sweep" policy
Case: Cole v. City of Memphis

Area of law: Constitutional law, fundamental rights, strict scrutiny, intermediate scrutiny, and intrastate travel.

Issue presented: Can a city implement a policy to clear streets after 3 a.m., even when there is no threat to public safety and regardless of why citizens are there?

Brief summary: Cole, an off-duty police officer, was arrested sometime after 3:30 a.m. on Beale Street in Memphis, Tennessee, under a standing police policy to sweep Beale Street of all "after hours" pedestrians regardless of whether there was any threat to public safety. Although all charges were eventually dropped, Cole sued because the police had violated his fundamental right to travel within the state. At trial, the City failed to show a connection between sweeping Beale Street and public safety. On appeal, the Sixth Circuit affirmed, holding that there was no connection between public safety and the arbitrary early-morning sweeps of Beale Street on weekends.

Extended summary: The Beale Street area of Memphis, Tennessee, is a popular entertainment district made up of restaurants, bars, clubs, and other venues. This area is a pedestrian-only zone: no vehicles are permitted on the street, so most traffic is on foot. Under state and local ordinances, pedestrians may carry and drink alcohol on the street and sidewalks when the street is closed to traffic.

Officer Cole, who was not on duty, was on Beale Street and left a dance club at around 3:30 a.m. Based on witness testimony, Cole was drunk and behaving erratically. Fellow Memphis police officers arrested and charged Cole with disorderly conduct, resisting arrest, and vandalism based on a standing policy: the "Beale Street Sweep." Under this policy, Memphis police were to order all "after hours" pedestrians off Beale Street - or arrest them - even if there were no circumstances posing a threat to public safety.

All charges against Cole were later dropped, but not before they caused Cole to lose his second job and be demoted through reassignment from the organized-crime unit to traffic patrol.

Cole and another plaintiff sued in the district court and formed a class action for those who were also arrested under this policy. In their complaint, they alleged that the "Beale Street Sweep" incited violence because the Memphis police became highly aggressive, agitated, and confrontational towards lawful pedestrians. The City admitted to having had this policy in place, but it claimed that it had abandoned the policy some time before Cole was arrested.

The jury found that the "Beale Street Sweep" was the cause for Cole's arrest because the conditions on Beale Street did not pose an imminent threat to public safety when Cole was arrested. Cole was awarded $35,000 in compensatory damages. The district court also granted Cole's motion for injunctive relief: the City of Memphis was enjoined from "engaging in the Beale Street Sweep."

On appeal, the City of Memphis argued that the district court erred when it found that the "Beale Street Sweep" infringed on a fundamental right: intrastate travel. Thus, the City argued, the district court had improperly applied strict scrutiny.

The Sixth Circuit reaffirmed its precedent recognizing that, in general, intrastate travel is a fundamental right. It explained that intrastate travel is so deeply rooted in the nation's history and traditions that it is an implicit liberty. Thus, local travel through public places continues to be a fundamental right, warranting heightened scrutiny. Nevertheless, the Sixth Circuit concluded that intermediate scrutiny, and not strict scrutiny, was the more appropriate standard in this case given the Beale Street Sweep's limited two-block scope and limited two-hour timing on weekends and after special events.

Under intermediate scrutiny, the Sixth Circuit required the City of Memphis to show that the Beale Street Sweep was a narrowly tailored practice to meet the City's significant objectives. The City identified public safety as its significant objective. The Sixth Circuit agreed that public safety is a significant - in fact, a compelling - objective.

Yet the City's argument failed because it couldn't show that the Beale Street Sweep was connected to its stated goal of ensuring public safety. The Sixth Circuit observed that in the district court, the jury found that the sweep occurred without regard to whether there was an imminent or immediate threat to public safety. Instead, the sweep was set at an arbitrary time and had no connection to then-existing conditions on Beale Street. Without the required connection to public safety, the City's policy failed under intermediate scrutiny.

Panel: GIBBONS, GRIFFIN, and DONALD, Circuit Judges.

Date of issued opinion: October 17, 2016

Docket numbers: October 17, 2016

Decided: October 17, 2016

Decision: Affirmed the district-court judgment.

Counsel: ARGUED: J. Michael Fletcher, CITY OF MEMPHIS, Memphis, Tennessee, for Appellant. Robert L. J. Spence, Jr., THE SPENCE LAW FIRM, Memphis, Tennessee, for Appellees. ON BRIEF: J. Michael Fletcher, Zayid A. Saleem, Barbaralette G. Davis, CITY OF MEMPHIS, Memphis, Tennessee, for Appellant. Robert L. J. Spence, Jr., Bryan M. Meredith, E. Lee
Whitwell, THE SPENCE LAW FIRM, Memphis, Tennessee, for Appellees.

Author of opinion: GIBBONS, J., delivered the opinion of the court in which DONALD, J., joined, and GRIFFIN, J., joined in part. GRIFFIN, J. (pp. 16 - 19), delivered a separate opinion concurring in part and dissenting in part.

Case alert author: Peter J. Mancini, Western Michigan University Cooley Law School

Case alert circuit supervisor: Professor Mark Cooney

Link to the case: www.opn.ca6.uscourts.gov/opinions.pdf/16a0258p-06.pdf

Edited: 10/24/2016 at 02:27 PM by Mark Cooney

    Posted By: Mark Cooney @ 10/24/2016 02:05 PM     6th Circuit     Comments (0)  

  Greg Hargus v. Ferocious and Impetuous, LLC - Third Circuit
Headline: Tortious act of throwing an object from land at an individual on an anchored vessel does not threaten a disruptive effect on maritime commerce and does not invoke federal admiralty law

Area of Law: Federal Admiralty and Maritime Jurisdiction

Issue(s) Presented: Whether throwing a coffee cup from land at an individual's head, who is standing on an anchored vessel, threatens a disruptive effect on maritime commerce and, thus, invokes maritime jurisdiction?

Brief Summary: Plaintiff filed a personal injury suit in District Court when he was hit in the head by a coffee cup while standing on an anchored vessel. Defendant threw the coffee cup from land. The Third Circuit concluded that plaintiff's negligence claim did not invoke maritime jurisdiction because the act did not potentially disrupt maritime commerce.
As established by the United States Constitution and 28 U.S.C §1333(1), "federal district courts have original jurisdiction over any civil case of admiralty or maritime jurisdiction" for the purpose of protecting maritime commerce. These cases must satisfy conditions of both location and of connection with maritime activity in order to be asserted.
The Third Circuit held that the first prong of the admiralty jurisdiction connection test was not met. Analyzing the "potential disruptive effects" the tortious act could have had on maritime commerce, the Third Circuit concluded that throwing an object from land at a person on an anchored vessel did not disrupt the waterway, obstruct free passage of commercial ships, or damage nearby commercial ships. Therefore, the incident did not have a disruptive effect on maritime commerce and failed to satisfy the first prong of the connection test, rendering federal admiralty jurisdiction inappropriate.

Extended Summary: Plaintiff Greg Hargus filed a negligence claim in district court when he was hit in the head by a coffee cup while he was standing on an anchored vessel. The coffee cup was thrown by Defendant Kyle Coleman while he was on land. The Third Circuit found that this tortious incident did not invoke maritime jurisdiction because it did not "potentially disrupt maritime commerce."
As established by the United States Constitution and 28 U.S.C §1333(1), "federal district courts have original jurisdiction over any civil case of admiralty or maritime jurisdiction." The purpose of having maritime jurisdiction is to protect maritime commerce. "To invoke federal admiralty jurisdiction over a tort claim, the claim must satisfy conditions of both location and of connection with maritime commerce."
The Third Circuit focused on the connection aspect of the test. Connection is satisfied by fulfilling a two-part test, requiring the court to first establish that "the general features of the type of incident involved have a potentially disruptive impact on maritime commerce." Referencing other cases, the Third Circuit noted that a disagreement or "physical altercation" between individuals on or around navigable water did not disrupt navigation, because it did not impede the "free passage of commercial ships in navigable waterways." Also, because the injurious event occurred while the vessel was docked, the vessel's crew was not distracted, which could have posed a danger to colliding with other vessels.
The Third Circuit held that the activity did not pose a threat to potentially disrupting maritime commerce since it did not obstruct the free passage of commercial ships, create a risk of collision of vessels, or damage a nearby vessel. Therefore, the first prong of the connection test was not satisfied, barring the application of federal admiralty jurisdiction. The Third Circuit vacated the judgment and remanded with instructions for the District Court to dismiss the case.

The full opinion can be found at http://www2.ca3.uscourts.gov/opinarch/153635p.pdf

Panel: Fuentes, Vanaskie, and Restrepo, Circuit Judges

Argument Date: May 19, 2016

Date of Issued Opinion: October 18, 2016

Docket Number: No. 15-3635

Decided: Vacated and remanded

Case Alert Author: Katherine A. Osevala

Counsel: Matthew J. Duensing, Counsel for Appellants.

Author of Opinion: Circuit Judge Vanaskie

Circuit: Third Circuit

Case Alert Circuit Supervisor: Professor Mary E. Levy

    Posted By: Susan DeJarnatt @ 10/24/2016 12:50 PM     3rd Circuit     Comments (0)  

  USA v. Kareem Bailey - Third Circuit
Headline: Admission of highly prejudicial video evidence of a murder in connection with drug conspiracy convictions ruled harmless error due to overwhelming amount of other evidence

Area of Law: Federal Rules of Evidence Rule 403, Harmless Error

Issue(s) Presented: Did the district court commit harmful error in admitting highly prejudicial video evidence of a murder, not committed by defendants, to prove defendants' participation in a drug-trafficking organization?

Brief Summary: The four defendants were convicted for conspiracy and involvement in a heroin trafficking organization in Atlantic City, New Jersey. Video and non-video evidence of a murder committed by an individual other than the four defendants were admitted at trial. This evidence was used to prove the firearm and drug trafficking conspiracy charges of the defendants. The Third Circuit applied Federal Rule of Evidence 403, balancing the probative versus prejudicial effect of the evidence and found the non-video evidence of the murder to be admissible. Invoking the Rule 403 balancing for the video evidence of the murder, the Third Circuit concluded the unfair prejudice substantially outweighed the probative value of the video. The Third Circuit concluded the government had sufficiently proven the murder and its connection to the drug conspiracy through wiretapped phone calls and testimony, and therefore, was using the video only to elicit emotion. However, the Third Circuit found the error to be harmless. The Third Circuit reasoned that due to abundant other evidence that established defendants' guilt, it was not highly probable that the admission of the video altered their convictions. The Third Circuit affirmed the defendants' convictions.

Extended Summary: The four defendants were convicted of a number of charges relating to their involvement and conspiracy to participate in a violent heroin trafficking organization in Atlantic City, New Jersey. Defendants made four main arguments on appeal regarding the District Court's admission of evidence during trial and its refusal to grant a mistrial, which the Third Circuit dismissed with hardly any discussion. The Third Circuit only found their argument regarding the erroneous admission of video evidence of a drug-trafficking related murder to be of merit. However, the Third Circuit ruled that due to the abundance of other evidence available to establish the defendants' guilt, the admission of the video evidence was harmless.
Defendants argued that the prejudicial effect of the admission of evidence of a drug-trafficking related murder substantially outweighed the probative value, thus violating Rule 403 of the Federal Rules of Evidence. Rule 403 allows courts to "exclude relevant evidence if its probative value is substantially outweighed by unfair prejudice." The court uses a balancing test to evaluate the need for evidence "against the risk of prejudice to the defendant."
Video and non-video evidence of the murder was admitted at trial. The non-video evidence included testimony and recorded conversations regarding the murder. Because both the murder and the conspiracy charges were related to drug trafficking, the Third Circuit concluded the non-video evidence of the murder was more highly probative than prejudicial.
However, the Third Circuit found the admission of the video evidence of the murder to be highly prejudicial, outweighing its probative value. The video depicted an individual shooting the victim directly in the head outside of a crowded restaurant. The Third Circuit stated that the only value the murder video served was to play on the emotions of the jury. Also, the Third Circuit noted that there was an abundance of other evidence that was used to prove the conspiracy and firearm charges against the defendants. Therefore, video evidence of a murder not committed by the defendants was unnecessary. The Third Circuit concluded the prejudicial value of the video evidence of the murder substantially outweighed its probative value and was erroneously admitted.
Regardless of this error, the Third Circuit found the admission to be a harmless error. "An evidentiary error is harmless if it is highly probable that the error did not contribute to the judgment." The Third Circuit ruled the admission of the video to be harmless error due to the amount of other evidence available to prove the defendants' involvement in the drug-trafficking conspiracy and the firearm charges. Therefore, it was not probable that the admission of the video evidence altered the outcome of defendants' case, making the erroneous admission harmless. Defendants' convictions were affirmed.

The full opinion can be found at http://www2.ca3.uscourts.gov/opinarch/152128p.pdf

Panel: McKee, Chief Judge, Jordan, and Roth, Circuit Judges

Argument Date: April 28, 2016

Date of Issued Opinion: October 18, 2016

Docket Number: No. 15-2276

Decided: Affirmed

Case Alert Author: Katherine A. Osevala

Counsel: John M. Holliday, Gina A. Capuano, William R. Spade, Jr., and James R. Murphy, Counsel for Appellants; Mark E. Coyne and Norman Gross, Counsel for Appellees.

Author of Opinion: Chief Judge McKee

Circuit: Third Circuit

Case Alert Circuit Supervisor: Professor Mary E. Levy

    Posted By: Susan DeJarnatt @ 10/24/2016 12:43 PM     3rd Circuit     Comments (0)  

  Sixth Circuit says states, not FCC, control scope of telecommunications services offered by municipality-owned utilities
Case: Tennessee v. FCC

Area of law: Telecommunications and internet services

Issue presented: Is an FCC preemption order valid when it allows a municipality-owned utility to expand telecommunications services beyond what state law permits?

Brief summary: Both Tennessee and North Carolina enacted laws permitting municipality-owned utilities to offer telecommunications services, including internet, to customers within their respective service areas. Two municipally owned utilities petitioned the Federal Communications Commission (FCC) for preemptions allowing them to offer internet services outside their service area. After the FCC granted preemptions, Tennessee and North Carolina sought judicial review of the FCC's orders. The Sixth Circuit reversed both FCC orders, holding that the FCC does not have the authority to stop states from limiting the expansion of services offered by its municipalities. Only the municipality's state has that authority.

Extended summary: Tennessee enacted a law in 1999 that permitted municipality-owned power plants (utilities) to also offer telecommunication services - cable, video, and internet services - to customers within their service areas. This law's geographic limitation, however, bars a municipality from offering telecommunication services outside its service area to surrounding areas.

Chattanooga, Tennessee, operates a power provider, the Electric Power Board (EPB), which offers high-speed broadband internet service to 170,000 residential and commercial customers in Tennessee and Georgia.

Likewise, North Carolina enacted a law in 1971 that permits its municipalities, or their utilities, to provide broadband internet services. And North Carolina also prohibits municipalities from offering these internet services to anyone beyond their municipal boundaries too. The City of Wilson, North Carolina, constructed a fiber-optic internet-backbone network connecting all City-owned facilities. City residents, businesses, as well as educational and medical facilities sought access to this network, and the City responded by expanding its network for these customers by giving them access for fees. The City's services included phone, internet, and cable, and its customers are paying less for these services when compared to the competition.

EPB and the City of Wilson sought preemptions from the FCC; they wanted to offer their services to customers outside their respective service areas. The FCC granted both petitions for preemption. In the FCC's order, the FCC required Tennessee and North Carolina to give their municipalities a choice in undertaking these discretionary actions.

Tennessee petitioned the Sixth Circuit to review the FCC's decision, and North Carolina filed a similar petition in the Fourth Circuit. The cases were consolidated in the Sixth Circuit.

After a thorough analysis of the Telecommunications Act of 1996, the Sixth Circuit reversed the FCC order. The Sixth Circuit reasoned that federal law cannot limit a state's ability "to trump a municipality's exercise of discretion [that is] otherwise permitted by FCC regulations . . . [and federal law] cannot be read to authorize such preemption." As such, the FCC did not have the authority to permit the service-area expansion being sought by EPB and the City of Wilson. The Sixth Circuit concluded that only Tennessee and North Carolina held the authority to expand services within an area.

Panel: ROGERS and WHITE, Circuit Judges; HOOD, District Judge. (The Honorable Joseph M. Hood, United States District Judge for the Eastern District of Kentucky, sitting by designation.)

Date of issued opinion: August 10, 2016

Docket numbers: 15-3291/3555

Decided: August 10, 2016

Decision: FCC order reversed.

Counsel: Joshua S. Turner, WILEY REIN LLP, Washington, D.C., for Petitioner in 15-3291. John F. Maddrey, NORTH CAROLINA DEPARTMENT OF JUSTICE, Raleigh, North Carolina, for Petitioner in 15-3555. Matthew J. Dunne, FEDERAL COMMUNICATIONS COMMISSION, Washington, D.C., for Respondents. ON BRIEF: Joshua S. Turner, Megan L. Brown, WILEY REIN LLP, Washington, D.C., for Petitioner in 15-3291. John F. Maddrey, NORTH CAROLINA DEPARTMENT OF JUSTICE, Raleigh, North Carolina, for Petitioner in 15-3555. Matthew J. Dunne, Richard K. Welch, FEDERAL COMMUNICATIONS COMMISSION, Washington, D.C., for Respondents. James Bradford Ramsay, NATIONAL ASSOCIATION OF REGULATORY UTILITY COMMISSIONERS, Washington, D.C., for Intervenor National Association of Regulatory Utility Commissioners. James Baller, Sean A. Stokes, Ashley Stelfox, BALLER HERBST STOKES & LIDE, PC, Washington, D.C., James P. Cauley III, Gabriel Du Sablon, CAULEY PRIDGEN, P.A., Wilson, North Carolina, for Intervenor City of Wilson. Frederick L. Hitchcock, Willa B. Kalaidjian, CHAMBLISS, BAHNER & STOPHEL, P.C., Chattanooga, Tennessee, for Intervenor Electric Power Board of Chattanooga. William J. Kirsch, Arlington, Virginia, Andrew L. Brasher, OFFICE OF THE ALABAMA ATTORNEY GENERAL, Montgomery, Alabama, Conor B. Dugan, WARNER NORCROSS & JUDD LLP, Grand Rapids, Michigan, Richard A. Samp, WASHINGTON LEGAL FOUNDATION, Washington, D.C., David Parkhurst, NATIONAL GOVERNORS ASSOCIATION, Washington, D.C., Bartlett Cleland, Jonathan Hauenschild, AMERICAN LEGISLATIVE EXCHANGE COUNCIL, Arlington, Virginia, Ashley Stelfox, BALLER HERBST STOKES & LIDE, PC, Washington, D.C., Mark C. Del Bianco, LAW OFFICE OF MARK C. DEL BIANCO, Kensington, Maryland, Andrew Jay Schwartzman, Eric G. Null, INSTITUTE FOR PUBLIC REPRESENTATION, Washington, D.C., Lani L. Williams, LOCAL GOVERNMENT LAWYER'S ROUNDTABLE, INC., Oconomowoc, Wisconsin, Kimberly Hibbard, NORTH CAROLINA LEAGUE OF MUNICIPALITIES, Raleigh, North Carolina, Markham C. Erickson, STEPTOE & JOHNSON LLP, Washington, D.C., for Amici Curiae.

Author of opinion: ROGERS, J., delivered the opinion of the court in which HOOD, D.J., joined, and WHITE, J., joined in part. WHITE, J., delivered a separate opinion concurring in part and dissenting in part.

Case alert author: Peter J. Mancini, Western Michigan University Cooley Law School

Case alert circuit supervisor: Professor Mark Cooney

Link to the case: www.opn.ca6.uscourts.gov/opinions.pdf/16a0189p-06.pdf

    Posted By: Mark Cooney @ 10/24/2016 11:59 AM     6th Circuit     Comments (0)  

  Chaille Dubois, et al. v. Atlas Acquisitions LLC -- Fourth Circuit
Buyer Beware When Scheduling Debts in Chapter 13 Bankruptcies

Areas of Law: Bankruptcy Law

Issue Presented: Whether a debt collection agency violates the Fair Debt Collective Practices Act (FDCPA) by filing proofs of claim based on time-barred debts in a Chapter 13 bankruptcy.

Brief Summary: The United States Court of Appeals for the Fourth Circuit held that Atlas Acquisitions, LLC, a debt collection agency, did not violate the FDCPA and affirmed the bankruptcy court's dismissal of Appellant's FDCPA claims because although the debt was time-barred, the statute of limitations did not extinguish the debt and the debtor failed to schedule a time-barred debt.

Extended Summary: The Fair Debt Collections Practices Act (FDCPA) was enacted by Congress to eliminate abusive debt collection practices. The statute prohibits debt collectors from using "any false, deceptive, or misleading representation or means in connection with the collection of any debt," or from using "unfair or unconscionable" methods to collect a debt. When debt collectors are found to be in violation of the FDCPA they are liable for actual damages, statutory damages up to $1,000, and attorney's fees and costs.

This case concerns two debtors, Chaille Dubois and Kimberly Adkins, who secured loans from payday lenders that were eventually sold to a third party debt collector, Atlas Acquisitions, LLC. Adkins owed two debts to Atlas, one for $184.62 and another for $390.00. Dubois owed $135.00 to Atlas based upon a loan that originated with payday lender Iadvance.

In the bankruptcy court, Atlas brought a proof of claim against both Dubois and Adkins for the unpaid debts. A proof of claim is the mechanism by which a creditor can register its interest against the assets of the bankruptcy estate. In bankruptcy court, Adkins and Dubois filed complaints against Atlas alleging that Atlas' claims were essentially stale and violated the FDCPA. The bankruptcy court quickly determined that filing a proof of claim was not a form of debt collection activity under the FDCPA and dismissed all of Dubois' and Adkins' claims.

The United States Court of Appeals for the Fourth Circuit first found that filing a proof of claim was a debt collection activity that could be regulated by the FDCPA because filing a proof of claim is an attempt to collect a debt. Next, the Fourth Circuit held that when the statute of limitations does not extinguish a debt, a time-barred debt falls within the Bankruptcy Code's broad definition of a claim because a time-barred debt still constitutes a "right to payment." The Fourth Circuit held that filing a proof of claim in a Chapter 13 bankruptcy based on a time-barred debt does not violate the FDCPA when the statute of limitations has not extinguished the debt. The Fourth Circuit affirmed the Bankruptcy Court for the District of Maryland's dismissal of Dubois and Adkins' FDCPA claims.

To read the full opinion, click here.

Panel: Judges Diaz, Floyd, and Thacker

Argument Date: May 10, 2016

Date of Issue:
August 25, 2016

Docket Number: No. 15-1945

Decided: August 25, 2016

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

Counsel: Morgan William Fisher, LAW OFFICES OF MORGAN FISHER LLC,
Annapolis, Maryland, for Appellants. Donald S. Maurice, Jr.,
MAURICE WUTSCHER, LLP, Flemington, New Jersey, for Appellee.
ON BRIEF: Courtney L. Weiner, LAW OFFICES OF MORGAN FISHER LLC,
Washington, D.C., for Appellants. Alan C. Hochheiser, BUCKLEY
KING, LPA, Cleveland, Ohio, for Appellee.

Author of Opinion:
Judge Floyd

Case Alert Supervisor:
Professor Renee Hutchins

    Posted By: Renee Hutchins @ 10/24/2016 10:40 AM     4th Circuit     Comments (0)  

  Amaya v. Power Design, Inc. -- Fourth Circuit
Fourth Circuit Confirms Private Right of Action Under FLSA

Areas of Law: Labor & Employment law

Issue Presented: Whether workers employed under federal contracts expressly incorporating two federal labor statutes (the Davis-Bacon Act and Contract Work Hours and Safety Standards Act) can bring claims for unpaid hourly and overtime wages under the Fair Labor Standards Act.

Brief Summary: The United States Court of Appeals for the Fourth Circuit vacated and remanded the district court's grant of summary judgment of plaintiffs' FLSA claims in favor of defendant Power Design, Inc. The subcontracts at issue were governed by the Davis-Bacon Act (DBA) and the Contract Work Hours and Safety Standards Act (CWHSSA). While neither of those two statutes provided for a private right of action, they also did not bar the plaintiffs' FLSA claims. The Fourth Circuit explained that Congress enacted FLSA knowing it would apply broadly despite overlap with other labor statutes. Because there are no conflicts between the three statutes, plaintiffs were entitled to bring unpaid hourly and overtime wages under FLSA.

Extended Summary: Twenty electrical construction workers sought unpaid hourly and overtime wages for work completed under federally-funded subcontracts. The relevant subcontracts expressly incorporated the DBA and CWHSSA. These two federal statutes regulate different aspects of federal construction contracts. However, the workers sought relief under the FLSA because, unlike the DBA and CWHSSA, the FLSA provides a private right of action in state or federal court. The United States District Court for the District of Maryland held the workers could not "circumvent" the DBA and CWHSSA's lack of private rights of action by bringing a FLSA claim. The trial court therefore granted summary judgment in favor of the defendant.

The Fourth Circuit reviewed the issue de novo. The court began by comparing the justifications for the three statutes and their enforcement mechanisms. The DBA and CWHSSA regulate only certain aspects of federal construction contracts. The U.S. Department of Labor can address violations of the two statutes by withholding contract funds or banning awards of federal contracts for up to three years. In contrast, the FLSA has a broader purpose to "to eliminate, as rapidly as practicable, substandard labor conditions throughout the nation" and "to raise living standards without substantially curtailing employment or earning power." To enforce this statute, individuals can bring suit for FLSA violations directly in state or federal court.

Next, the court reviewed precedent from the United States Supreme Court and the Fourth Circuit that explained the interaction between the FLSA and other labor statutes. This precedent instructed that such statutes are not mutually exclusive. Consequently, the applicable provisions of all statutes can apply insofar as they do not conflict.

Turning to the case before it, the Fourth Circuit held that because Congress intended the FLSA to apply broadly regardless of overlap with other labor statutes and because the three statutes do not conflict, the workers' FLSA claims were not barred by the subcontracts' inclusion of the DBA and CWHSSA. Before examining potential conflicts among the three statutes, the court noted that the language of both the FLSA and the DBA and CWHSSA envisioned that they could all be applied concurrently with one another and other federal labor statutes. For example, when Congress passed the CWHSSA it acknowledged that the FLSA already applied to a lot of the construction industry and therefore many contractors would be subject to "several different legislative standards and enforcement procedures applicable to the same conduct."

Next, the court rejected the defendant's proposed conflicts among the three statutes. First, the Fourth Circuit explained that the DBA and CWHSSA's failure to provide an implied private right of action does not amount to a conflict with the FLSA. The court also found the DBA's wage requirements, which may impose higher payments than the FLSA's federal minimum wage, did not create a conflict. Next, the court concluded that calculating overtime under each statute does not create a statutory inconsistency or conflict. Lastly, the court found there is no conflict between the DBA and FLSA when calculating overtime under the FLSA. The court also rejected the defendant's argument that the actual amount of overtime compensation sought by the workers created a conflict between the DBA and FLSA. This was in part because the purported conflict did not arise from the statutes themselves but from a Department of Labor regulation, and the court would not defer to a regulation that causes a conflict with the FLSA. Finally, determining the overtime compensation the workers are properly owed is an issue of proof for the district court, not a legislative conflict.

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

Panel: Judges Diaz, Floyd, and Thacker

Argument Date: 05/10/2016

Date of Issued Opinion:
8/15/2016

Docket Number: No. 15-1691

Decided: Vacated and remanded by published opinion

Case Alert Author: Annie McGuire, Univ. of Maryland Carey School of Law

Counsel:
Argued: Daniel Adlai Katz, THE LAW OFFICES OF GARY M. GILBERT &
ASSOCIATES, P.C., Silver Spring, Maryland, for Appellants. Leslie A. Stout-Tabackman, JACKSON LEWIS P.C., Reston, Virginia, for Appellee. Erin Michelle Mohan, UNITED STATES DEPARTMENT OF LABOR, Washington, D.C., for Amicus Secretary of Labor. On Brief: Lucy Brierly Bansal, THE LAW OFFICES OF GARY M. GILBERT & ASSOCIATES, P.C., Silver Spring, Maryland; Virginia Rae Diamond, ASHCRAFT & GEREL, LLP, Alexandria, Virginia, for Appellants. Paul DeCamp, Jeremy S. Schneider, JACKSON LEWIS P.C., Reston, Virginia, for Appellee. M. Patricia Smith, Solicitor of Labor, Jennifer S. Brand, Associate Solicitor, William C. Lesser, Deputy Associate Solicitor, Paul L. Frieden, Counsel for Appellate Litigation, UNITED STATES DEPARTMENT OF LABOR, Washington, D.C., for Amicus Secretary of Labor. Maurice Baskin, LITTLER MENDELSON, P.C., Washington, D.C., for Amicus Associated Builders and Contractors, Inc.

Author of Opinion: Judge Diaz

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 10/24/2016 10:14 AM     4th Circuit     Comments (0)  

October 17, 2016
  Mack v. Warden Loretto FCI - Third Circuit
Headline: Third Circuit Finds That Inmate's Oral Grievance Of Anti-Muslim Harassment Is Constitutionally Protected Under First Amendment and Indirect Pressure May Constitute a Substantial Burden on Religious Expression under Religious Freedom and Restoration Act

Area of Law: First Amendment Retaliation, Religious Freedom and Restoration Act

Issue(s) Presented: (1) Whether an inmate's oral grievance to prison officials can constitute protected activity under the Constitution; (2) Whether RFRA prohibits individual conduct that substantially burdens religious exercise; and (3) Whether RFRA provides for monetary relief from an official sued in his individual capacity.

Brief Summary: Plaintiff, an inmate and practicing Muslim at a federal correctional institution in Pennsylvania, filed a pro se lawsuit against various correctional officers for First Amendment retaliation and for violations of the Religious Freedom and Restoration Act. Plaintiff argued that he was fired from his commissary work assignment after he complained about officers' anti-Muslim conduct. He also claimed that one officer's anti-Muslim comments and conduct created a hostile work environment such that he was afraid to pray at work. He complained orally and in writing after the harassment, after the termination, and after receiving an unsatisfactory explanation for the termination. The Third Circuit found that Plaintiff's oral complaint was constitutionally protected and certain Defendants were not entitled to qualified immunity. The Court also found that the RFRA was the appropriate vehicle for relief to challenge a government official's individual conduct that indirectly coerced Plaintiff to betray his religious exercise.

Extended Summary: Plaintiff worked for pay in the prison commissary. Plaintiff was a practicing Muslim and was provided certain religious accommodations at work. Defendants were assigned to supervise the commissary. One officer slapped Plaintiff hard on the back, tagging him with an "I love bacon" sticker. He also made offensives comments about Muslims and told Plaintiff, "he'd be looking for a new job soon." Another officer stood by and laughed. Plaintiff claimed that the officers' conduct created a tense working environment, and that as a result Plaintiff was afraid to pray at work.

Plaintiff spoke to the officers' supervisor to complain about the anti-Muslim conduct and statements. Plaintiff was fired one week later for "bringing other inmates' commissary slips in," which Plaintiff denied. He eventually filed an inmate request-to-staff form seeking explanation in writing for why he was terminated. He orally complained to the Warden and then filed a formal grievance with the Deputy Warden. This federal lawsuit followed after his grievance was rejected.

With regard to the First Amendment retaliation claim, the Third Circuit affirmed dismissal of claims against certain Defendants because they were not involved until after Plaintiff was terminated. The Court vacated the dismissal and remanded for further proceeding with regard to the remaining Defendants. The Court found that Plaintiff properly exhausted his administrative remedies, alerting prison officials to his principal allegation, as required by the Prison Litigation Reform Act. The Court also found that Plaintiff's oral complaint was constitutionally protected because it sufficiently and timely put prison officials on notice that he sought redress, was conveyed in a reasonable manner, and concerned conduct that the prison itself prohibited. The Court additionally noted that the facility encouraged inmates to communicate their concerns orally and informally before filing a grievance. Lastly, the Court found that Defendants were not entitled to qualified immunity because a reasonable official in the officers' position should have known that retaliating against Plaintiff for exercising his right to petition was unlawful, especially if the prison encouraged its inmates to communicate their concerns orally.

With regard to the Religious Freedom and Restoration Act ("RFRA") claim, the Third Circuit vacated dismissal and remanded for further proceedings. The Court held that RFRA is the appropriate vehicle for relief to challenge a government official's individual conduct, regardless of whether that conduct was undertaken pursuant to an official rule or policy. The Court also held that RFRA provides for monetary relief when officers act unlawfully because monetary damages would be consistent with the purpose of RFRA to provide "appropriate relief" when religious liberty is substantially burden by government officials. Lastly, the Court held that a burden could be substantial even if it does not involved direct coercion to betray one's religious beliefs. Allegations of indirect pressure substantially burdening religious exercise are sufficient to survive a motion to dismiss.

The full opinion can be found at http://www2.ca3.uscourts.gov/opinarch/142738p.pdf

Panel: McKee, Fuentes, and Roth, Circuit Judges

Argument Date: April 18, 2016

Date of Issued Opinion: October 11, 2016

Docket Number: 14-2738

Decided: Affirmed in part, vacated in part and remanded

Case Alert Author: Jasmine M.Williams

Counsel: Sean E. Andrussier, Esq. and Duke University Law Students, John Bailey, Anne Showalter, Russell Taylor, Attorneys for Appellant; Jennifer R. Andrade, Esq., Jane M. Dattilo, Esq., and Rebecca R. Haywood, Esq., Office of United States Attorney, Attorneys for Appellees

Author of Opinion: Circuit Judge Fuentes

Circuit: Third Circuit

Case Alert Circuit Supervisor: Professor Mary E. Levy

    Posted By: Susan DeJarnatt @ 10/17/2016 09:49 AM     3rd Circuit     Comments (0)  

October 13, 2016
  TCA Television Corp. v. McCollum - Second Circuit
Headline: Second Circuit Holds that Broadway's "Hand of God" Appropriation of "Who's on First?" Routine Was Not Fair Use, But Affirms Dismissal of Copyright Infringement Action on Alternative Invalidity Ground.

Areas of Law: Intellectual Property; Copyright Law

Issue(s) Presented: Whether the defendants' verbatim use of a portion of Abbot and Costello's iconic comedy routine "Who's on First?" in the Broadway produced play "Hand of God" qualified as a non-infringing fair use. Whether plaintiffs' had a valid copyright on "Who's on First?"

Brief Summary: In light of the unauthorized use by defendants, the playwright and producers of the dark comedic Broadway play "Hand of God" of a verbatim portion of the iconic comedy sketch "Who's on First?," the successors in interest to the estates of William "Bud" Abbott and Lou Costello - plaintiffs herein - commenced an action for copyright infringement in the Southern District of New York, claiming both federal and common law copyright infringement. Upon defendants' Rule 12(b)(6) motion, the district court dismissed the complaint determining that, as a matter of law, defendants' use of the routine constituted a non-infringing fair use of the material. On plaintiffs appeal from this ruling, the Second Circuit concluded that defendants' unauthorized appropriation of "Who's on First?" was not fair use, but, nevertheless, affirmed the judgment below finding that plaintiffs had failed to plead a valid copyright interest. Judgment of dismissal in favor of defendants affirmed.

To read the full opinion, please visit:
http://www.ca2.uscourts.gov/de...2f0f4973f6a/1/hilite/

Extended Summary:
Plaintiffs, successors-in-interest to the estates of William "Bud" Abbott and Lou Costello (the "Artists"), claim to be owners of the copyright to the comedy routine in issue here, "Who's on First?" (also the "Routine") - a treasured piece of American entertainment history, derived from the humorous misunderstandings which take place when a roster of a baseball team is filled with oddly named players such as "Who," "What," and "I Don't Know." "Who's on First?" was first performed in the late 1930s on a live radio broadcast, and was published, for purposes of federal copyright law, when Abbott and Costello performed a version of it in their first motion picture, "One Night in the Tropics ("Tropics") produced by Universal Pictures Company, Inc. ("UPC"). Abbott's and Costello's work with UPC was pursuant to contractual agreements including one executed in November 1940 (the "November Agreement,") days before the release of Tropics which encompassed a multi-year/multi-picture bargain. The contract gave UPC the right to use Abbott's and Costello's materials and routines in connection with any photoplay in which the Artists appeared. However, the Artists expressly reserved the right to use materials and routines created by them, without the assistance of UPC writers, on the radio and in personal appearances. Additionally, in November 1940, UPC registered a copyright for Tropics with the United States Copyright Office, which it timely renewed in December 1967.

Thereafter, in 1945, Abbott and Costello performed an expanded version of "Who's on First?" in another UPC movie, "The Naughty Nineties." That expanded version, while maintaining the core of the Routine - with "Who" on first base, "What" on second, and "I Don't Know" on third - , further included several new players. Here too, UPC registered a copyright for "The Naughty Nineties," and timely renewed it in 1972. Independently, in April 1944, Abbott and Costello also registered with the Copyright Office a work entitled "Abbott and Costello Baseball Routine," indicating that it had been published in March 1944 in "Soldier Shows." This work, however, was never renewed, and entered the public domain in 1972. Finally, in March 1984, a quitclaim agreement (the "Quitclaim") was entered into between Universal Pictures ("Universal") - successor-in-interest of UPC - and Abbott & Costello Enterprises ("A&C), a partnership formed by the heirs of Abbott and Costello, under which all of Universal's rights, title and interest in the Routine were granted by Universal to A&C. Thereafter, A&C dissolved in 1992, with 50% of its assets being transferred to TCA Television Corporation, a California entity owned by Lou Costello's heirs; and the remaining 50% evenly to Bud Abbot's heirs and later transferred to the remaining plaintiffs in the present action.

The defendants include the author and producers of the successful off-Broadway play "Hand to God," a dark comedy set in small-town Texas, in which the main character, a young man, communicates through a hand puppet, which becomes his evil persona. After success off-Broadway, in the spring of 2015 the play opened for previews on Broadway, incorporating, without license or permission, part of the Routine in one of its key scenes. In that scene, which takes place approximately 15 minutes into the play, "Jason," the lead character, in an attempt to impress "Jessica," his romantic interest, performs almost verbatim, a little over a minute of "Who's on First?" At the end of Jason's performance, Jessica asks whether Jason had come up with the routine by himself. Jason's dishonest answer in the affirmative inevitably induces audience laughter, given the familiarity of this iconic routine.

After learning about the unauthorized use of the Routine through press coverage and online promotional materials, and receiving no response to a letter to cease and desist, plaintiffs filed the underlying action in June 2015 in the United States District Court for the Southern District of New York, claiming federal and common law copyright infringement. Defendants moved to dismiss advancing that: plaintiffs did not hold a valid copyright; or, in any event the Routine was in the public domain; and "Hand to God's incorporation of the Routine was sufficiently transformative to qualify as a permissible fair use, not prohibited infringement. The district court granted defendants' motion to dismiss concluding that defendants' use of the Routine in "Hand to God" was a highly transformative and non-infringing fair use. The instant appeal followed.

The Second Circuit's de novo review of the dismissal found error in the district court's finding of fair use as a matter of law. Citing earlier decisions, the court recognized the well-established principle that some opportunity for fair use of copyrighted materials is necessary to promote the Constitutional purpose of progress in science and art. The nonexclusive factors for a clearly established fair use defense, the court noted, have been codified under 17 U.S.C. §107, as follows: 1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; 2) the nature of the copyrighted work; 3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and 4) the effect of the use upon the potential market for or value of the copyrighted work. These factors, the court noted, must be viewed collectively, with their results weighed together.

The Second Circuit found that all four statutory factors weighed in favor of plaintiffs and against a defense of fair use. First, the court found that the defendants' use of the Routine did not appear to fit within any of the statutory categories identified as "most appropriate" for a purpose or character finding indicative of fair use - criticism, comment, news reporting, teaching, scholarship, and research. The court concluded that the district court's reasoning was flawed by identifying only a general artistic and critical purpose and character of the play as a "darkly comedic critique" of the social norms in a small religious town, but failing to explain how defendants' extensive copying was necessary to accomplish such purpose, or how the character of the Routine was transformed by defendants' use. The court noted that challenged works which satisfied the transformative purpose standard are those where a defendant's use of a work has so "heavily obscured and altered" the original work as to make it "barely recognizable" within the new work. In this case, the court found defendants' use of the Routine fell short of this standard, as the used portion was included unaltered. Therefore, the court concluded, such use could not be held to be transformative.

Even when such unaltered uses could be considered fair use when they bore no relationship to the original work, a justification is, the court noted, nevertheless necessary to qualify for a fair use defense. In this case, defendants used the original work for the same central purpose for which it was created - a comedy. Thus, the court found that defendants fell short of satisfying the justification threshold inasmuch as more than the Routine's ability to capture audience attention was necessary to provide a proper justification for defendants' extensive copying of it. Additionally, the court found that defendants' extensive use of the Routine further qualified as commercial exploitation weighing strongly against fair use.

As to the nature of the copyrighted work, the court also found it weighed in favor of plaintiffs herein, inasmuch as the Routine, being an original comedy sketch created for public entertainment, lay at the heart of copyright's intended protection. Moreover, the court rejected defendants' justification that they needed to use an instantly recognizable "cultural" touchstone in the relevant scene. Likewise, looking to the amount and substantiality of the portion of the appropriated material used, the court found that it weighed strongly in favor of plaintiffs because, although it took less than two minutes to perform, it nevertheless constituted the heart of the original work, by revealing the singular joke underlying the entire Routine. Finally, the court found that the district court had erred in concluding that the play's use of the Routine could not reasonably be expected to usurp the market for Abbott and Costello's original performance because the district court had failed to consider the challenged use's "impact on potential licensing revenues for traditional, reasonable, or likely to be developed markets." Since plaintiffs had alleged the existence of a traditional and active derivative market for licensing the Routine, the court also found this factor weighed in plaintiffs' favor.

Notwithstanding the foregoing analysis, the court concluded that the complaint must nevertheless be dismissed because plaintiffs plausibly failed to plead ownership of a valid copyright in the Routine. The court found that contractual agreements with UPC clearly expressed the parties' intent for Abbott and Costello to merely license the use of, and not to assign copyrights in, their existing comedy routines for use in UPC movies in which the Artists appeared. The court found the contract language to be clear and unambiguous, and concluded that Abbott and Costello furnished UPC with their routines for a limited purpose, their use in any movies in which the Artists appeared under the respective agreements. The court also rejected plaintiffs' argument that the Routine was a work made for hire and, thus, should survive by virtue of UPC's timely renewal of the registration of Tropics, finding that the Routine was prepared several years prior to the contracts, and therefore it could not be said to have been made at UPC's instance and expense.

Finally, the Court was not persuaded by plaintiffs' alternative argument under the merger doctrine that, because so much of the Routine was used in the movies, the material "merged" with them making part of the whole protected by UPC's statutory registration and the timely renewal of the copyrights for movies using the Routine. The Court noted that the Routine had been prepared and existed on its own for some years before it was performed in Tropics, and that it had been performed independently from the films thousands of times on the radio and elsewhere. Therefore, the Court concluded that this merger argument must fail.

In conclusion, although rejecting the defendants' fair use defense, the Court nevertheless affirmed the dismissal of the complaint finding it warranted by plaintiffs' failure plausibly to plead ownership of a valid copyright.

To read the full opinion, please visit:
http://www.ca2.uscourts.gov/de...2f0f4973f6a/1/hilite/

Panel: Circuit Judges Jacobs, Calabresi and Raggi

Argument Date: 06/23/2016


Date of Issued Opinion: 10/11/2016

Docket Number: 16-134-cv

Decided: Affirmed

Case Alert Author: Gloria Mejia-Repp

Counsel:
Jonathan D. Reichman, Kenyon & Kenyon LLP, New York, New York, for Plaintiffs-Appellants; Mark J. Lawless, Law Office of Mark J. Lawless, New York, New York, for Defendants-Appellees.

Author of Opinion:
Judge Reena Raggi

Case Alert Circuit Supervisor: Professor Elyse S. Diamond

    Posted By: Elyse Diamond @ 10/13/2016 07:32 AM     2nd Circuit     Comments (0)  

October 11, 2016
  PHH Corp. v. Consumer Finance Protection Bureau
Headline: D.C. Circuit says single-director structure of independent Consumer Finance Protection Bureau violates Article II of the Constitution.

Area of Law: Separation of Powers; Article II; Constitutional Law

Issue Presented: Whether, under Article II of the Constitution, Congress can create an independent agency headed by a single director, removable by the President only for cause.

Summary: The Consumer Finance Protection Bureau (CFPB), an independent agency with a single director created by the Dodd-Frank Act, is charged with unilateral enforcement of nineteen federal consumer protection statutes. The single director decides what rules to issue and how, when, and against whom to enforce the laws and is by statute removable by the President only for cause. Petitioner PHH Corp., a mortgage lender subject to CFPB enforcement action, challenged CFPB's status as an independent agency governed by a single director under Article II of the Constitution. PHH Corp. argued that either the agency's director must be removable at will by the President, or, if structured as an independent agency, the CFPB must be restructured as a multi-director commission.

The D.C. Circuit agreed with PHH Corp. that the CFPB's structure is unconstitutional. The court noted that independent agencies have a tenuous position in our separation of powers structure and represent a departure from the fundamental understanding that Article II grants the President power to supervise, direct, and remove executive officers. The court noted that Humphrey's Executor v. United States, 295 U.S. 602 (1935), which upheld independent agencies against constitutional challenge, did so on the understanding that they were comprised of nonpartisan bodies of experts. At that time and ever since, with only "anomalous" exceptions, independent agencies have operated with multi-member governance structures. Looking to this consistent history and settled practice, as well as the massive unilateral power possessed by the CFPB director to administer and oversee enforcement of nineteen laws, the court found great risk of arbitrary decision-making and abuse of power in the CFPB as presently constituted. The court was not persuaded that the director's advisory board mitigated any risk because the director is free to disregard the advisory board's advice. The court acknowledged that, in extreme circumstances, a supermajority of the Financial Stability Oversight Council has veto power over CFPB regulations but found that the Council's limited role did not suffice to make the CFPB the functional equivalent of a multi-member agency.

Turning to remedy, the D.C. Circuit followed the Supreme Court's lead in severing the provision permitting removal of the director only for cause from the rest of the statute. With the for-cause provision thus excised, the court held that the President has authority to remove the director at will and to supervise and give direction to the director, thus bringing the CFPB in line with regular executive agencies within the executive chain of command. The court observed that, while another potential cure for the constitutional infirmity might be to turn an independent CFPB into a multi-member commission, the "editorial freedom" making such a change would require was for Congress, not the judicial branch.

Because its severability determination left the CFPB intact, the court then proceeded to address and resolve PHH Corp.'s statutory arguments, ultimately agreeing with PHH Corp., vacating the CFPB's order, and remanding for reconsideration.

Judge Randolph concurred to raise an additional constitutional infirmity, noting that the ALJ who presided over PHH Corp.'s initial hearing was an "inferior officer" under Article II who had to be appointed by the President, courts of law, or heads of departments and was not so appointed.

Judge Henderson concurred in part and dissented in part on the basis that the success of PHH Corp.'s statutory arguments made resolution of the underlying constitutional question unnecessary.

For the full text of this decision, please visit https://www.cadc.uscourts.gov/internet/opinions.nsf/AAC6BFFC4C42614C852580490053C38B/$file/15-1177-1640101.pdf.


Panel: Circuit Judges Henderson and Kavanaugh and Senior Circuit Judge Randolph

Argument Date: April 12, 2016

Date of Issued Opinion: October 11, 2016

Docket Number: No. 15-1177

Decided: Vacated and remanded

Case Alert Author: Elizabeth Earle Beske

Counsel: Theodore B. Olson, Helgi C. Walter, Mitchel H. Kider, David M. Souders, Thomas M. Hefferon, and William M. Jay for Petitioners. Lawrence DeMille-Wagman, Meredith Fuchs, and John R. Coleman for Respondent.

Author of Opinion: Circuit Judge Kavanaugh

Case Alert Circuit Supervisor: Elizabeth Earle Beske & Ripple Weistling

    Posted By: Ripple Weistling @ 10/11/2016 01:54 PM     DC Circuit     Comments (0)  

October 10, 2016
  United States of America v. Michael Free - Third Circuit
Headline: Sentencing guidelines allow harm enhancement only for economic harm inflicted or intended by bankruptcy fraudster

Area of Law: Federal Sentencing

Issues Presented: How is "loss" calculated under the Federal Sentencing Guidelines when a defendant commits bankruptcy fraud, but all of his creditors receive payment in full?

Brief Summary: Michael Free filed for bankruptcy, despite having more than sufficient assets to pay his debts. Thereafter, Free hid assets worth hundreds of thousands of dollars from the Bankruptcy Court. Free's actions eventually led to criminal charges and convictions for four counts of bankruptcy fraud. The Third Circuit upheld his conviction even though the creditors were paid in full because of overwhelming evidence that Free concealed assets and lied repeatedly to the trustee and the court. The Third Circuit vacated his sentence because it was enhanced based on the estimated value of the assets Free concealed and the amount of debt he sought to discharge, rather than on any economic loss he inflicted or intended to inflict on his creditors. It remanded for resentencing and directed the lower court to consider sentencing under this standard but noted that Free's manifest disrespect for the judicial system could merit an upward departure from the Guidelines.

Extended Summary: In 2010, Michael Free filed for bankruptcy, despite having more than sufficient assets to pay his debts. Thereafter, Free hid assets, mostly rare WW II-era guns, worth hundreds of thousands of dollars from the Bankruptcy Court. Free's actions eventually led to criminal charges and convictions for multiple counts of bankruptcy fraud. The Court noted that "[t]he oddity of this entire situation is best summarized by the fact that, despite all of Free's prevarications, his creditors received 100 cents on the dollar from Free's bankruptcy estate."

The Federal Sentencing Guidelines increase a bankruptcy fraudster's recommended sentence based on the amount of loss he causes, or intends to cause, to his victims. At Free's sentencing hearing, the District Court therefore needed to make a determination as to the amount of loss caused or intended to be caused by Free's crimes. Instead, the District Court chose to treat the estimated value of the assets that Free concealed from the Bankruptcy Court and the amount of debt sought to be discharged as the relevant "loss" under the Guidelines. This resulted in a Guidelines range of 21 - 27 months' imprisonment. The District Court ultimately sentenced Free to 24 months' incarceration on each count, to run concurrently, and to a term of supervised release of three years.

The Third Circuit found the evidence of Free's guilt indisputable and rejected his argument that he did not commit fraud because his creditors received full payment. Free was properly convicted of four counts under 18 U.S.C. § 157. "One commits bankruptcy fraud under § 157 by (1) devising a scheme to defraud, and (2) filing a document in a bankruptcy proceeding or making [a] false or fraudulent statement in relation to the bankruptcy proceeding for the purpose of executing or concealing the fraudulent scheme," and there was ample evidence from which a reasonable jury could have concluded that Free did precisely that. Moreover, the Court clarified that no fraudulent losses need to occur for a debtor to violate § 157; "[f]iling itself is the forbidden act." Thus, the Court found the evidence that Free filed fraudulent documents with the Bankruptcy Court to be overwhelming. Finally, the Court stated counts V and VI involved violations of 18 U.S.C. §§ 152(1) and 152(2), noting that "[a] debtor violates § 152(1) by failing to "reveal the existence of his assets to the United States Trustee,"' and § 152(2) outlaws "knowingly and fraudulently mak[ing] a false oath" in relation to a bankruptcy case. The Court again found the evidence of Free's guilt to be irrefutable.

Second, the Third Circuit vacated the sentence, holding that the District Court erred in its calculation of "loss" under the Sentencing Guidelines. The Court concluded that treating the value of Free's concealed assets as "loss," was out-of-step with the structure of the Guidelines and inconsistent with its own precedent. Because the District Court did not clearly find whether Free intended to deprive his creditors of this, or of any amount, the enhancement was not warranted. Instead, the Third Circuit instructed the District Court to determine whether Free intended to cause a loss to his creditors, or what he sought to gain from committing the crime.

The Third Circuit acknowledged the District Court's view that it is "sensible to punish fraudsters who conceal assets of greater value more harshly than defendants who conceal assets of lesser value." In fact, the Court explained that in the vast majority of cases, the loss calculation will have precisely this effect because, "generally speaking, the reason defendants conceal assets in bankruptcy is to benefit themselves at the expense of their creditors." Nonetheless, the Third Circuit found that the District Court failed to make explicit factual findings as to whether Free had such an intent: "While we are sympathetic with the District Court's desire to punish Free in a manner commensurate with his disrespect for the judiciary, we nonetheless conclude that inflating Free's loss figure based on a theory of abstract harm to the judiciary is not an appropriate way to calibrate his sentence under the Guidelines."

In conclusion, the Third Circuit added that even if the District Court finds no such intended loss, Free may not receive a lower sentence on remand. The Court explained Free's repeated lying to the Bankruptcy Court and his manifest disrespect for the judicial system could merit an upward departure or variance from the Guidelines, urging the District Court to examine these issues to determine an appropriate sentence consistent with the statutory sentencing factors and the applicable Sentencing Guidelines. Accordingly, the Third Circuit vacated the District Court's judgment and remanded the case for resentencing.

The full opinion can be found at http://www2.ca3.uscourts.gov/opinarch/152939p.pdf

Panel: Fuentes, Shwartz, and Restrepo, Circuit Judges

Argument Date: July 12, 2016

Date of Issued Opinion: October 6, 2016

Docket Number: No. 15-2939

Decided: Vacated and remanded

Case Alert Author: Brooke Hutchins

Counsel: Martin A. Dietz, Esquire, for Appellant; Rebecca R. Haywood, Esquire, for Appellee.

Author of Opinion: Circuit Judge Fuentes

Circuit: Third Circuit

Case Alert Circuit Supervisor: Prof. Susan L. DeJarnatt

    Posted By: Susan DeJarnatt @ 10/10/2016 12:56 PM     3rd Circuit     Comments (0)  

  Bobbi-Jo Smiley; Amber Blow; Kelsey Turner v. E.I. DuPont de Nemours and Company; Adecco USA, Inc. - Third Circuit
Headline: Third Circuit Holds Regular Paid Lunch Does Not Offset Required Overtime Pay

Area of Law: Fair Labor Standards Act

Issues Presented: Can DuPont offset overtime pay for employees by using the paid lunch time DuPont voluntarily provides to employees?

Brief Summary:

Employees working at DuPont's manufacturing plant in Towanda, PA bring a putative collective action and class action against DuPont seeking overtime compensation for before and after their shifts. DuPont voluntary provided these employees a thirty minute paid break and argued that break could offset the work employees were doing before and after their shifts. The Third Circuit reviewed the FLSA and determined that the lunch break could not offset overtime work because the employees were receiving it at their regular pay and not at a premium rate. The Third Circuit reversed and remanded the District Court's grant of summary judgment in favor of DuPont.

Extended Summary:

Bobbi-Jo Smiley, Amber Blow, and Kelsey Turner filed a putative collective action and class action against DuPont seeking overtime compensation for time before and after their shifts. 160 workers opted in to the class action. Appellants worked twelve-hour shifts at DuPont's manufacturing plant in Towanda, PA. DuPont directly employed Smiley and Blow, while Adecco employed Turner as an hourly contract employee. Employees were required to be onsite before and after their shifts to "don and doff" uniforms and protective gear. They were also required to participate in "shift relief" which involved sharing of information and status updates. The time spent on these two activities ranged from thirty to sixty minutes a day.

Although the FLSA does not require compensation for meal breaks, DuPont chose to compensate employees for one thirty minute paid lunch break, in addition to two non-consecutive thirty minute breaks. The paid break time always exceeded the amount of time Plaintiffs spent pre and post shift. Plaintiffs sought to recover overtime compensation for time spent donning and doffing their uniforms and protective gear and performing shift relief. DuPont argued that it could offset the overtime compensation with the paid breaks which they voluntarily provided. The District Court agreed holding that the FLSA allowed DuPont to use paid non-work time to offset the required overtime and dismissed the lawsuit entirely.

The Third Circuit first reviewed the statutory language of the FLSA. First, the Court determined that the voluntary paid lunch that DuPont provided is considered regular pay because the employees are compensated at a regular rate and not a premium rate. The Court looked to the definition of "hours worked" and permissible offsetting under the FLSA and determined that nothing in the FLSA authorizes the type of offsetting where an employer seeks to credit compensation that is included in calculating an employee's regular rate of pay against its overtime liability. The FLSA only provides for an offset of an employer's overtime liability using other compensation not already included in the regular rate and paid at a premium rate.

The FLSA does not require employers to treat meal breaks as hours worked, but it does not prohibit them from doing so. In this case, DuPont voluntary provided paid breaks and compensated employees with regular pay which can not offset overtime pay under the FLSA. The Third Circuit reversed and remanded.

Find the full opinion at:

http://www2.ca3.uscourts.gov/opinarch/144583p.pdf

Panel: Vanaskie, Krause and Rendell, Circuit Judges

Argument Date: July 14, 2016

Date of Issued Opinion: October 7, 2016

Docket Number: No. 14-4583

Decided: Reversed and Remanded

Case Alert Author: Jessica Wood

Counsel:

Thomas M. Marrone, Esq., Patricia V. Pierce, Esq., Counsel for Appellants Bobbi-Jo Smiley, Amber Blow, and Kelsey Turner

David S. Fryman, Esq., Amy L. Bashore, Esq., Counsel for Appellee E.I. du Pont de Nemours and Company

A. Patricia Diulus-Myers, Eric R. Magnus, Counsel for Appellee Adecco USA, Inc.

Rachel Goldberg, Esq., Counsel for Amicus Curiae, Secretary, United States Department of Labor

Author of Opinion: Rendell, Circuit Judge

Circuit: Third Circuit

Case Alert Supervisor: Prof. Susan L. DeJarnatt

    Posted By: Susan DeJarnatt @ 10/10/2016 11:15 AM     3rd Circuit     Comments (0)  

  Sixth Circuit: WebWatcher software may violate Wiretap Act and unlawfully invade privacy
Case: Luis v. Zang

Area of law: Wiretap acts and privacy law

Issue presented: Does a software manufacturer violate privacy rights or federal/Ohio wiretap laws, which ban the monitoring and contemporaneous interception of communications, when the manufacturer's surreptitiously installed software transmits a home computer's electronic communications to the manufacturer's servers, where it is stored until the software user retrieves the communications later?

Brief summary: Joseph Zang, concerned about his wife's online chatroom participation, installed WebWatcher on his wife's computer without her knowledge or consent. He used this software to monitor her correspondences with a man she'd never met but contacted daily. He then used the WebWatcher contact records as leverage to secure more favorable divorce terms a year later. Javier Luis, who had regularly corresponded with Zang's wife through chatrooms, sued Zang and WebWatcher's manufacturer, Awareness Technologies, after learning of the disclosure of his private, personal communications with Zang's wife. Luis alleged that Awareness and Zang, through the use of WebWatcher, violated his privacy rights and also wiretap laws when WebWatcher intercepted his computer's electronic communications meant for Zang's wife and sent them to Awareness's servers for Zang to retrieve and read later.

The Sixth Circuit held that Luis had properly pleaded his claims - federal Wiretap Act violations, Ohio Wiretap Act violations, and Ohio common-law violations including privacy violations - against Awareness Technologies, and that the trial court's dismissal of the case was improper.

Extended summary: During Catherine Zang's marriage to Joseph Zang, she participated in an online chatroom where she "met" Javier Luis. They developed a platonic relationship and contacted each other at least daily, but they never met in person. Concerned with his wife's online relationship with Luis, Zang purchased and installed Webwatcher on Catherine's computer without her knowledge or consent. Webwatcher, manufactured by Awareness Technologies, intercepts electronic communications, such as emails or instant messages, and in near real time forwards them to Awareness's servers for storage and later retrieval. After collecting his wife's communications with Javier for months, Zang used them as leverage to get better divorce terms from his wife.

Luis sued Zang, Awareness, and others after learning of this. Luis settled with all but Awareness. In his complaint against Awareness, Luis alleged that Awareness knew or should have known that purchasers of its software, WebWatcher, would use it for illegal purposes. Thus, he asserted that Awareness violated his privacy as well as the federal Wiretap Act, the Ohio Wiretap Act, and Ohio common law.

During the case, a magistrate judge was directed to prepare a Report and Recommendation evaluating Awareness's arguments that it had not intercepted Catherine's communications and that it could not be held liable simply for manufacturing software that a purchaser used to violate federal and state laws. The district court adopted the Report and Recommendations and dismissed the claims against Awareness.

The Sixth Circuit reversed, holding that Luis had properly pleaded his claims against Awareness. The Sixth Circuit found that WebWatcher does intercept communications, as defined under the federal Wiretap Act, and acquires communications in a manner that is contemporaneous with their transmissions. Consequently, the allegations could support an eventual finding that Awareness violated the federal Wiretap Act. And the Sixth Circuit found that Luis sufficiently pleaded and argued that Awareness manufactured and sold wiretapping equipment in violation of federal law. Luis could establish that there was an intentional interception of wire, oral, or electronic communications by WebWatcher and Awareness. As such, Luis could potentially show that Awareness violated the